Importing LNG a ‘great option’
5 December 2025
The viability of importing liquid natural gas (LNG) economically into New Zealand presents a great option for responding to dry winters for power generation according to an energy sector analyst.
John Kidd, director and head of research for energy sector market analysts Enerlytica, was enthusiastic about the flexibility that the LNG option could provide in shoring up electricity generation when needed, when presenting at GasNZ’s recent industry forum.
The economics of the operation had completely changed from 15 or so years ago when the option was first considered, he said.
Then, the sector was looking at an LNG import terminal in Taranaki – a permanent, onshore facility that would have cost the best part of a billion dollars to build, Kidd said.
“That’s entirely the opposite of what we’re looking at here.”
Instead, a specialist ship – a floating storage and regasification vessel (FSRU), could negate the need to build a permanent onshore terminal facility.
“It’s floating, its modular, it comes and goes; the ship could quite conceivably be shared seasonally with the northern hemisphere”, and only be called upon when required, he said.
Supply ships would bring frozen LNG to New Zealand that would be offloaded to the moored FSRU, rewarmed and turned back into gas when required, and possibly then fed directly into an existing gas pipeline such as that which comes onshore from the Maui field.
Such storage and processing vessels had the capacity to store up to 4.2PJ of frozen energy – processing and dispatching from zero to 500TJ per day, Kidd said.
By way of comparison, New Zealand’s residential demand for natural gas is around 4.7PJ per year.
The option of LNG imports matches up with “a very sweet spot with power gen”, he said.
“We’ve had four extreme winters for the last four years. 2021 and 2024 were extremely dry whereas 2022 and 2023 were extremely wet.”
In 2021 and 2023 it was very likely that the storage and processing vessel would not have been required, but the option would have been there to have it, Kidd said.
“In 21 and 24 it is likely that the option would have been called on – but we don’t have that option at the moment.”
Power generation has a greater ability to pay for the option than what a lot of other local industrial users have, he said.
With its volume, flexibility, contract duration and comparatively low price, “it’s a very comfortable fit with power generation”.
“This is really the space where it presents the greatest opportunity.”