1 00:00:05,519 --> 00:00:08,000 Speaker 1: Yelda, Welcome to Shared Lunch, brought to you by Shares's. 2 00:00:08,080 --> 00:00:10,080 Speaker 1: My name is Dan Brown Skill. I'll be your host today. 3 00:00:10,440 --> 00:00:13,920 Speaker 1: We're joined by Andrew Jeffries, the chief executive of Echelon 4 00:00:14,000 --> 00:00:16,960 Speaker 1: Resources Limited, to talk about being a fossil fuel company 5 00:00:16,960 --> 00:00:20,320 Speaker 1: and how it fits into the global energy transition. Before 6 00:00:20,320 --> 00:00:22,120 Speaker 1: we get started, here's some important info. 7 00:00:22,640 --> 00:00:25,280 Speaker 2: Investing involves the risk you might lose the money you 8 00:00:25,320 --> 00:00:28,600 Speaker 2: start with. We recommend talking to a licensed financial advisor. 9 00:00:29,320 --> 00:00:33,080 Speaker 2: We also recommend reading product disclosure documents before deciding to invest. 10 00:00:33,400 --> 00:00:35,760 Speaker 2: Everything you're about to see and here is current at 11 00:00:35,800 --> 00:00:36,680 Speaker 2: the time of recording. 12 00:00:36,960 --> 00:00:38,400 Speaker 1: Andrew, Hello, thank you for coming. 13 00:00:38,640 --> 00:00:40,879 Speaker 3: Jan thank you very much for inviting me. 14 00:00:40,920 --> 00:00:43,080 Speaker 1: Hey, I was having a look at your share register 15 00:00:43,120 --> 00:00:44,879 Speaker 1: the other day and it looks to me like Sharesy's 16 00:00:44,960 --> 00:00:48,519 Speaker 1: users are approximately your fourth largest shareholder collectively. Is that right? 17 00:00:48,600 --> 00:00:51,320 Speaker 3: Yep, that's about right. And they're also quite an interactive 18 00:00:51,400 --> 00:00:54,720 Speaker 3: shareholder I think in terms of people are actually watching, 19 00:00:55,000 --> 00:00:57,280 Speaker 3: you know, watching things and buying and selling the shares. 20 00:00:57,320 --> 00:01:00,600 Speaker 1: So we're here in Wellington. Until recently you were an 21 00:01:00,600 --> 00:01:04,399 Speaker 1: INSIDEX listed company called New Zealand Oil and Gas. You're 22 00:01:04,440 --> 00:01:07,000 Speaker 1: still headquartered here in Wellington, but I think in May 23 00:01:07,319 --> 00:01:09,960 Speaker 1: you shifted the company to the Australian Stock Exchange and 24 00:01:10,040 --> 00:01:13,959 Speaker 1: rebranded as ischelon. Can you talk us through what motivated 25 00:01:13,959 --> 00:01:17,280 Speaker 1: those twin decisions. I assume they're related, and they are 26 00:01:17,319 --> 00:01:22,080 Speaker 1: related in a way. The fact is the so there 27 00:01:22,120 --> 00:01:24,560 Speaker 1: was a couple of things that drove the timing. One 28 00:01:24,600 --> 00:01:28,440 Speaker 1: was that we looked to move to the AX because look, 29 00:01:28,520 --> 00:01:35,040 Speaker 1: exchanges are places where capital comes together to invest in things. 30 00:01:36,440 --> 00:01:40,440 Speaker 1: The enz X tends to be has been quite successful 31 00:01:40,440 --> 00:01:44,800 Speaker 1: in things like zero you know is becoming is quite 32 00:01:44,840 --> 00:01:49,760 Speaker 1: a tech exchange. The AX is very much a resource exchange. 33 00:01:50,640 --> 00:01:53,880 Speaker 1: There's obviously quite a large capital pool in Australia with 34 00:01:53,960 --> 00:01:58,480 Speaker 1: their superannuation system. They tend to have a lot of 35 00:01:58,560 --> 00:02:04,240 Speaker 1: mining and expiation companies, so there's capital available and people. Also, 36 00:02:04,280 --> 00:02:07,640 Speaker 1: there's analysts and people who sort of understand our industry. So, 37 00:02:07,800 --> 00:02:11,799 Speaker 1: for example, in New Zealand, we had no comparable companies, 38 00:02:12,040 --> 00:02:15,160 Speaker 1: so I was the CEO of the largest and smallest 39 00:02:15,200 --> 00:02:19,320 Speaker 1: listed oil and gas explorer, which is great, it's quite 40 00:02:19,360 --> 00:02:22,680 Speaker 1: a fun anecdote, but the reality is that in Australia, 41 00:02:22,680 --> 00:02:26,679 Speaker 1: I've got around about sixty five comparable companies so there's 42 00:02:26,720 --> 00:02:28,480 Speaker 1: actually a pool of people who. 43 00:02:28,800 --> 00:02:33,760 Speaker 3: Have a better understanding of the oil and gas industry. 44 00:02:34,040 --> 00:02:37,280 Speaker 1: So there are just advantages to sitting alongside similar companies. 45 00:02:37,400 --> 00:02:40,079 Speaker 1: You could be compared to each other. Analysts that understand 46 00:02:40,080 --> 00:02:41,840 Speaker 1: one will understand another. That kind of thing. 47 00:02:42,160 --> 00:02:45,040 Speaker 3: So as we go through the energy transition, that transition 48 00:02:45,120 --> 00:02:47,960 Speaker 3: is going to need a lot of capital, and I 49 00:02:48,000 --> 00:02:52,200 Speaker 3: think that the resource market that is the ASX will 50 00:02:52,200 --> 00:02:55,120 Speaker 3: be one of the markets that provides the capital that 51 00:02:55,160 --> 00:03:01,200 Speaker 3: builds the projects that do the mining and processing that 52 00:03:01,320 --> 00:03:03,080 Speaker 3: will build all the machines that are going to make 53 00:03:03,120 --> 00:03:05,840 Speaker 3: the transition work. So you know, we want to be 54 00:03:06,040 --> 00:03:08,919 Speaker 3: very much part of that part of that scene. As 55 00:03:08,919 --> 00:03:11,960 Speaker 3: we'll come to around the role in the name echelon, 56 00:03:12,560 --> 00:03:16,280 Speaker 3: so we're a very science based, engineering based company, got 57 00:03:16,280 --> 00:03:19,520 Speaker 3: a lot of geologists. Echelon is a term that they 58 00:03:19,639 --> 00:03:23,680 Speaker 3: use for things that we may in a size order, 59 00:03:24,080 --> 00:03:31,520 Speaker 3: So things like mountains, fault blocks, formations, geological formations are 60 00:03:31,520 --> 00:03:35,000 Speaker 3: all referred to as on echelon. So it's got a 61 00:03:35,640 --> 00:03:40,480 Speaker 3: it resonates to that piece. It's also about to me, 62 00:03:40,600 --> 00:03:44,160 Speaker 3: it's about the you know, where we're putting our focus 63 00:03:44,280 --> 00:03:47,120 Speaker 3: in terms of looking at where those rocks are. So 64 00:03:47,160 --> 00:03:51,040 Speaker 3: we're looking at markets where we see that there will 65 00:03:51,080 --> 00:03:56,640 Speaker 3: be demand growth, that there's a strong appetite for hydrocarbons, 66 00:03:58,360 --> 00:04:01,800 Speaker 3: and so we're putting our putting our fit into those areas. 67 00:04:02,080 --> 00:04:06,520 Speaker 3: The next thing is it's our values we like to look. 68 00:04:06,560 --> 00:04:12,640 Speaker 3: We have a pretty rigorous scientific team. It's not huge, 69 00:04:12,640 --> 00:04:16,360 Speaker 3: we're not a big organization. We've got twenty people, but 70 00:04:16,480 --> 00:04:19,599 Speaker 3: we put some real rigor into our science, and we 71 00:04:19,760 --> 00:04:23,920 Speaker 3: have some very robust and experienced engineers as well. So 72 00:04:23,960 --> 00:04:26,400 Speaker 3: we feel that we're in an operational in terms of 73 00:04:26,440 --> 00:04:31,120 Speaker 3: the experience, and certainly, having worked globally and I have 74 00:04:31,200 --> 00:04:34,400 Speaker 3: worked with super majors and the next step down, next 75 00:04:34,480 --> 00:04:38,240 Speaker 3: level down companies, I don't think I have ever had 76 00:04:38,680 --> 00:04:43,480 Speaker 3: as experienced and as motivated team as I've got here. 77 00:04:44,480 --> 00:04:47,680 Speaker 1: You mentioned in there about wanting to be more focused 78 00:04:47,720 --> 00:04:50,280 Speaker 1: on the markets where there is more demand and more 79 00:04:50,320 --> 00:04:52,679 Speaker 1: work to do. There's been a lot of talk recently 80 00:04:52,760 --> 00:04:56,479 Speaker 1: about how New Zealand labor government banned oil and gas 81 00:04:56,600 --> 00:04:59,400 Speaker 1: exploration in twenty eighteen, and it seems like there's been 82 00:04:59,400 --> 00:05:01,400 Speaker 1: a sense from and he's like yours, that there's not 83 00:05:01,520 --> 00:05:04,120 Speaker 1: that much work for you to do here. In New Zealand. 84 00:05:04,200 --> 00:05:07,120 Speaker 1: Now is that the case and was that a factor 85 00:05:07,360 --> 00:05:07,760 Speaker 1: in the move? 86 00:05:08,680 --> 00:05:12,240 Speaker 3: Well, there's there's a couple of different sides to that. 87 00:05:12,320 --> 00:05:14,400 Speaker 3: On the one side, there is certainly a lot of 88 00:05:14,440 --> 00:05:20,200 Speaker 3: prospectivity in New Zealand. New Zealand has been underappreciated as 89 00:05:20,240 --> 00:05:24,000 Speaker 3: an exploration venue, mainly because it's what we call a 90 00:05:24,000 --> 00:05:24,880 Speaker 3: gassy province. 91 00:05:26,360 --> 00:05:29,320 Speaker 1: It doesn't sound good, Well, it's a gassy province. 92 00:05:29,320 --> 00:05:31,000 Speaker 3: In the past that wasn't good because it was a 93 00:05:31,000 --> 00:05:33,719 Speaker 3: long way from things and it was predominantly gas that 94 00:05:33,800 --> 00:05:37,600 Speaker 3: you found. So Maui was a great case in point. 95 00:05:37,640 --> 00:05:39,480 Speaker 3: It was at the time of its discovery it was 96 00:05:39,520 --> 00:05:44,000 Speaker 3: the world's largest offshore gas field, but nobody really knew 97 00:05:44,040 --> 00:05:46,920 Speaker 3: what to do with it, and it took a decade 98 00:05:47,200 --> 00:05:50,040 Speaker 3: or so. I think it was discovered, I think in 99 00:05:50,080 --> 00:05:52,440 Speaker 3: about sixty eight, and it was about the end of 100 00:05:52,480 --> 00:05:55,479 Speaker 3: the I think it was about nineteen eighty that it 101 00:05:55,560 --> 00:05:56,680 Speaker 3: actually produced. 102 00:05:57,279 --> 00:05:58,440 Speaker 1: People still wanted oil back. 103 00:05:58,480 --> 00:06:02,040 Speaker 3: People still wanted oil back then it's much easier to transport. Well, 104 00:06:02,160 --> 00:06:08,960 Speaker 3: the world's moved on, and now actually the world is 105 00:06:09,240 --> 00:06:12,680 Speaker 3: keen on gas and a lot of countries are trying 106 00:06:12,720 --> 00:06:18,240 Speaker 3: to reduce their use of coal, in particular by utilizing gas, 107 00:06:18,480 --> 00:06:21,520 Speaker 3: so it's actually a being a gassy province is no 108 00:06:21,600 --> 00:06:27,599 Speaker 3: longer a bad thing. So we've got twenty one sedimentary 109 00:06:27,600 --> 00:06:30,799 Speaker 3: basins in New Zealand. New Zealand's the fifth largest continental 110 00:06:30,839 --> 00:06:35,240 Speaker 3: mass in the world. It's most of it's underwater. We've 111 00:06:35,240 --> 00:06:40,440 Speaker 3: got a huge continental area and of those twenty one basins, 112 00:06:40,680 --> 00:06:48,200 Speaker 3: we've had wells drilled in five and four of them 113 00:06:48,279 --> 00:06:53,000 Speaker 3: have had hydrocarbons in them. Now you say, well, you've 114 00:06:53,080 --> 00:06:55,720 Speaker 3: drilled those basins and you haven't found anything. It took 115 00:06:56,920 --> 00:07:00,160 Speaker 3: thirty eight wells to find the North Sea. And think 116 00:07:00,160 --> 00:07:01,680 Speaker 3: you would have a hard time putting a well in 117 00:07:01,720 --> 00:07:04,560 Speaker 3: the North Sea without hitting something when you look at it. 118 00:07:04,600 --> 00:07:10,360 Speaker 3: But the reality is that exploration is a numbers game 119 00:07:10,680 --> 00:07:14,240 Speaker 3: and you do end up with a lot of unsuccessful 120 00:07:14,440 --> 00:07:17,760 Speaker 3: wells before you get success. So there is prospectivity. New 121 00:07:17,840 --> 00:07:21,280 Speaker 3: Zealand is very under explored. Even the Taranaki Basin is 122 00:07:21,360 --> 00:07:28,320 Speaker 3: under explored in global terms. The other basins Canterbury Great 123 00:07:28,320 --> 00:07:32,040 Speaker 3: South Basin even more so. They've barely been scratched, So 124 00:07:32,080 --> 00:07:37,120 Speaker 3: there is prospectivity there. On the flip side, it's the 125 00:07:37,200 --> 00:07:41,920 Speaker 3: oil and gas industry is like any heavy industry, is 126 00:07:41,960 --> 00:07:45,520 Speaker 3: not property development. We do not come in and do 127 00:07:45,600 --> 00:07:49,000 Speaker 3: something and sell it on and make a big make 128 00:07:49,040 --> 00:07:53,160 Speaker 3: big bucks and with not a care. We come in 129 00:07:53,440 --> 00:07:57,800 Speaker 3: and you become involved in a country. You spend tens 130 00:07:57,800 --> 00:08:03,080 Speaker 3: of millions of dollars obtaining seismic to spend hundreds of 131 00:08:03,080 --> 00:08:06,280 Speaker 3: millions of dollars doing wells, most of which are going 132 00:08:06,360 --> 00:08:10,880 Speaker 3: to be unsuccessful. To spend billions and billions of dollars 133 00:08:11,280 --> 00:08:17,040 Speaker 3: developing infrastructure to then produce those hydrocarbons and to sell 134 00:08:17,080 --> 00:08:24,040 Speaker 3: them all at the same time as with the government 135 00:08:24,120 --> 00:08:28,200 Speaker 3: owning the resource. So at no time does the does 136 00:08:28,240 --> 00:08:30,400 Speaker 3: your oil and gas company own the resource. It's actually 137 00:08:30,480 --> 00:08:34,000 Speaker 3: the country owns the resource. It can't be moved. You 138 00:08:34,040 --> 00:08:36,920 Speaker 3: can't offshore it because it's once you know it is 139 00:08:36,960 --> 00:08:41,800 Speaker 3: where it is. So you then develop a you know, 140 00:08:41,840 --> 00:08:47,040 Speaker 3: you develop a multi decade or relationship with the government 141 00:08:47,080 --> 00:08:50,640 Speaker 3: and with a country, and you know that sort of 142 00:08:50,720 --> 00:08:53,760 Speaker 3: thing requires a lot of certainty. So for investors to 143 00:08:53,800 --> 00:08:56,320 Speaker 3: come in and put the money up to do the 144 00:08:56,360 --> 00:09:01,760 Speaker 3: expiration requires certainty. So the the and I think that's 145 00:09:02,000 --> 00:09:07,480 Speaker 3: very long answer to your question. But the offshore ban, 146 00:09:08,320 --> 00:09:12,120 Speaker 3: while yeah, at the time not a lot of wells 147 00:09:12,120 --> 00:09:14,200 Speaker 3: had been were being drilled. We just had a big 148 00:09:14,800 --> 00:09:18,360 Speaker 3: price crash in the twenty fifteen, so not a lot 149 00:09:18,400 --> 00:09:21,920 Speaker 3: of wells were being drilled. The reality was that it 150 00:09:21,960 --> 00:09:24,320 Speaker 3: was like putting a big signpost in your front lawn 151 00:09:24,440 --> 00:09:28,520 Speaker 3: saying bugger off, we're not interested in having you here. 152 00:09:30,200 --> 00:09:34,520 Speaker 3: What then unfolded so and we knew about this, We 153 00:09:34,559 --> 00:09:38,280 Speaker 3: had experience of this. We had a block off Canterbury 154 00:09:38,920 --> 00:09:41,440 Speaker 3: that had a prospect, the Bark Prospect that we did 155 00:09:41,480 --> 00:09:48,080 Speaker 3: a report on public report on showing the impact that 156 00:09:48,120 --> 00:09:52,119 Speaker 3: it would have, which was several thousand jobs export industry. 157 00:09:53,760 --> 00:09:56,600 Speaker 3: You would have got all the southern dairies off coal, 158 00:09:58,160 --> 00:10:00,000 Speaker 3: you know, it would have been a You would have 159 00:10:00,040 --> 00:10:03,560 Speaker 3: produced around about a billion dollars a year in tax revenue, 160 00:10:03,600 --> 00:10:11,120 Speaker 3: so about enough to run a DHB. We had that block. 161 00:10:11,600 --> 00:10:14,800 Speaker 3: We were lining up with some international partners to come 162 00:10:14,840 --> 00:10:17,240 Speaker 3: and get that. One of those wells stuck in it, 163 00:10:17,920 --> 00:10:22,079 Speaker 3: and within a week those international partners have gone and 164 00:10:22,200 --> 00:10:25,240 Speaker 3: they have not they are not coming back. So if 165 00:10:25,280 --> 00:10:26,120 Speaker 3: they haven't come back at the. 166 00:10:26,080 --> 00:10:28,560 Speaker 1: Point, so you did have permission to explore there and 167 00:10:28,600 --> 00:10:29,120 Speaker 1: work there. 168 00:10:29,679 --> 00:10:31,720 Speaker 3: Even though we did have we had a we were 169 00:10:31,760 --> 00:10:34,840 Speaker 3: coming up to a block decision and the you know 170 00:10:35,000 --> 00:10:38,880 Speaker 3: there just wasn't wasn't a great deal. Companies can look through, 171 00:10:39,520 --> 00:10:42,600 Speaker 3: you know, if they see a government setting that says 172 00:10:42,720 --> 00:10:45,080 Speaker 3: we don't want you around, they can see through that. 173 00:10:45,120 --> 00:10:46,960 Speaker 3: They can go and spend that hundred million dollars on 174 00:10:47,000 --> 00:10:49,679 Speaker 3: an exploration. Well, but then you've got to develop, You've 175 00:10:49,720 --> 00:10:52,400 Speaker 3: got that long relationship you've got to have with the country, 176 00:10:53,000 --> 00:10:56,559 Speaker 3: and if you're not welcome, well you're not welcome. So 177 00:10:56,559 --> 00:10:59,800 Speaker 3: so there is a Look, it's been very well, you know, 178 00:10:59,800 --> 00:11:03,520 Speaker 3: it's it's been great to see the offshore ban reversed. 179 00:11:04,520 --> 00:11:08,360 Speaker 3: The problem is that now with the Labor government saying 180 00:11:08,400 --> 00:11:12,079 Speaker 3: they're just going to whack it back in again. You know, 181 00:11:12,160 --> 00:11:15,040 Speaker 3: what do you do as an international investor, what do 182 00:11:15,080 --> 00:11:17,200 Speaker 3: you do? Will you probably say I'm going to go 183 00:11:17,200 --> 00:11:21,240 Speaker 3: and spend my money somewhere else. So interestingly enough, at 184 00:11:21,240 --> 00:11:25,240 Speaker 3: the moment, the country with the highest offshore capital spend 185 00:11:25,320 --> 00:11:29,240 Speaker 3: in the next this coming year will be Norway, which 186 00:11:29,280 --> 00:11:34,719 Speaker 3: has a very welcoming exploration regime. Look, it's got very 187 00:11:34,760 --> 00:11:38,959 Speaker 3: high tax, it's quite prospective place, so people do explore 188 00:11:39,000 --> 00:11:42,640 Speaker 3: and find things. When they produce, they actually have a 189 00:11:42,960 --> 00:11:46,760 Speaker 3: very high tax regime, but companies don't mind that because 190 00:11:47,160 --> 00:11:51,480 Speaker 3: the risky part is the expiration. So the expiration is 191 00:11:52,600 --> 00:11:55,840 Speaker 3: supported very strongly by the Norwegian government and has been 192 00:11:55,880 --> 00:11:59,720 Speaker 3: for decades. So they've had a very stable regime similar too. 193 00:12:00,320 --> 00:12:02,560 Speaker 3: Up until the offshore band. We would go around the 194 00:12:02,559 --> 00:12:05,719 Speaker 3: world and say to people how similar the Norwegian and 195 00:12:05,800 --> 00:12:09,760 Speaker 3: the New Zealand regime were in many ways in terms 196 00:12:09,800 --> 00:12:15,439 Speaker 3: of stability. So yeah, it's a it's a difficult time 197 00:12:15,440 --> 00:12:17,600 Speaker 3: and it's one of the reasons why we've also looked 198 00:12:17,600 --> 00:12:21,160 Speaker 3: at and invested outside of New Zealand. 199 00:12:21,320 --> 00:12:23,800 Speaker 1: What would it take to bring you back? 200 00:12:24,960 --> 00:12:28,480 Speaker 3: Look, Norway is a pretty good example, you know, there 201 00:12:28,600 --> 00:12:34,600 Speaker 3: is a The Norwegian government actually do support exploration quite strongly, 202 00:12:35,920 --> 00:12:39,520 Speaker 3: not just in terms of waving a flag and you know, 203 00:12:39,679 --> 00:12:43,400 Speaker 3: buying you buying lunches or or whatever. You know, it's real, 204 00:12:43,880 --> 00:12:49,680 Speaker 3: it's real inducements to do exploration and I think. 205 00:12:49,880 --> 00:12:51,680 Speaker 1: Support it across the political spectrum. 206 00:12:51,840 --> 00:12:54,320 Speaker 3: It does appear to be because we've had green governments 207 00:12:54,360 --> 00:12:57,719 Speaker 3: and they still you know, they still support provide the 208 00:12:57,760 --> 00:13:02,400 Speaker 3: same support. Their regime has not changed over the decades. 209 00:13:03,520 --> 00:13:07,239 Speaker 3: The UK has a very similar you know, the geology 210 00:13:07,280 --> 00:13:14,720 Speaker 3: doesn't sort of take any regard to geographical country boundaries. 211 00:13:15,240 --> 00:13:17,120 Speaker 3: The geology is the same on the UK side of 212 00:13:17,120 --> 00:13:20,559 Speaker 3: the North Sea. The UK over the last thirty years 213 00:13:20,559 --> 00:13:25,000 Speaker 3: has played around with its tax system endlessly and they 214 00:13:25,400 --> 00:13:29,520 Speaker 3: there's virtually no spend in the UK or expiration in 215 00:13:29,559 --> 00:13:33,760 Speaker 3: the next year. So you've got Norway biggest spend ever 216 00:13:34,480 --> 00:13:38,160 Speaker 3: and the UK with virtually none, right next to each other. 217 00:13:38,280 --> 00:13:42,559 Speaker 3: Same geology, and that's just down to regulatory just down 218 00:13:42,600 --> 00:13:43,400 Speaker 3: to regular tests. 219 00:13:43,520 --> 00:13:47,640 Speaker 1: What you can explore, which parties support what yep? Okay, 220 00:13:48,920 --> 00:13:51,120 Speaker 1: if you if the band hadn't been put in place, 221 00:13:51,600 --> 00:13:54,360 Speaker 1: do you think you would have new wells up and running, 222 00:13:54,400 --> 00:13:56,760 Speaker 1: a new site up and running today? What might an 223 00:13:56,800 --> 00:13:58,040 Speaker 1: alternate reality look like? 224 00:13:58,600 --> 00:14:01,000 Speaker 3: I think, Look, I think there is certainly one, at 225 00:14:01,080 --> 00:14:05,920 Speaker 3: least I know of one and probably two prospects that 226 00:14:05,920 --> 00:14:09,360 Speaker 3: would have been drilled. Would they have been online now, 227 00:14:10,240 --> 00:14:12,520 Speaker 3: Probably not. You need quite a lot of infrastructure to 228 00:14:12,520 --> 00:14:15,840 Speaker 3: put them online. Would they have been six years further 229 00:14:15,880 --> 00:14:21,640 Speaker 3: down the track? Absolutely, So it's a game where you've 230 00:14:21,640 --> 00:14:24,280 Speaker 3: got the oil and gas expiration game is a game 231 00:14:24,280 --> 00:14:27,160 Speaker 3: where you've got to run to stand still, So you've 232 00:14:27,200 --> 00:14:29,920 Speaker 3: always got to be drilling more wells because it's a 233 00:14:29,960 --> 00:14:35,160 Speaker 3: depleting industry. I know, when I first embarked on my 234 00:14:35,240 --> 00:14:39,520 Speaker 3: career in the early nineties in oil and gas, I 235 00:14:40,000 --> 00:14:42,040 Speaker 3: had a lot of people say to me, well, we'll 236 00:14:42,120 --> 00:14:48,880 Speaker 3: run out in two thousand and it didn't. You know, 237 00:14:49,160 --> 00:14:52,000 Speaker 3: there's and I would imagine a lot of people. Even 238 00:14:52,000 --> 00:14:54,840 Speaker 3: more people are probably getting the same message now. And 239 00:14:54,880 --> 00:14:58,160 Speaker 3: I think we'll come to it potentially later on, but 240 00:14:58,320 --> 00:15:01,760 Speaker 3: I think there is a large you know, we do 241 00:15:01,880 --> 00:15:05,600 Speaker 3: need oil and gas in the system, gas in particular 242 00:15:05,720 --> 00:15:06,560 Speaker 3: through the transition. 243 00:15:07,360 --> 00:15:08,720 Speaker 1: Yeah, so I really wanted to ask you about this, 244 00:15:08,760 --> 00:15:11,120 Speaker 1: and I think lots of OL viewers will be interested 245 00:15:11,120 --> 00:15:12,720 Speaker 1: in this as well. Obviously lots of that are invested 246 00:15:12,760 --> 00:15:14,480 Speaker 1: in you. But another thing shares these hears from its 247 00:15:14,520 --> 00:15:16,560 Speaker 1: investors all the time is that they're really interested in 248 00:15:16,760 --> 00:15:20,640 Speaker 1: ESG and impact investing. That's like a very popular genre. 249 00:15:22,000 --> 00:15:25,120 Speaker 1: So it is interesting. I think being a fossil fuel company, 250 00:15:25,320 --> 00:15:27,680 Speaker 1: you provide a service. People need that service, society needs 251 00:15:27,680 --> 00:15:31,400 Speaker 1: that service. But perhaps sometimes you're painted as the villain. 252 00:15:31,600 --> 00:15:34,120 Speaker 1: And you know, just last week, the UN was two 253 00:15:34,120 --> 00:15:36,880 Speaker 1: weeks ago, maybe the UN Secretary General was in New 254 00:15:36,960 --> 00:15:39,480 Speaker 1: Zealand and went on to the Pacific and people asked 255 00:15:39,520 --> 00:15:43,080 Speaker 1: him about the ban of oil and gas exploration reversal, 256 00:15:43,360 --> 00:15:45,840 Speaker 1: and he said, the only thing I can tell you 257 00:15:45,960 --> 00:15:48,000 Speaker 1: is that any oil and gas that will be discovered 258 00:15:48,000 --> 00:15:50,960 Speaker 1: from now, I am absolutely sure it will never be used. 259 00:15:51,560 --> 00:15:54,240 Speaker 1: You're exploring new fields. You'd like to explore new fields. 260 00:15:54,400 --> 00:15:57,120 Speaker 1: What is the UN Secretary General got wrong there? Why 261 00:15:57,120 --> 00:16:00,600 Speaker 1: do people have this view when you have quite a 262 00:16:00,640 --> 00:16:01,320 Speaker 1: different one. 263 00:16:01,600 --> 00:16:07,400 Speaker 3: Yeah, Look, so there is notionally there are enough oil 264 00:16:07,440 --> 00:16:11,880 Speaker 3: reserves if we you know, let's talk to the oil 265 00:16:11,960 --> 00:16:14,560 Speaker 3: side of the story. First oil reserves in the world 266 00:16:14,680 --> 00:16:19,440 Speaker 3: to meet potential future demand. Eighty percent of those oil 267 00:16:19,480 --> 00:16:25,200 Speaker 3: reserves are in Venezuelan and bitchumen and Canadian oil sands. Now, 268 00:16:25,280 --> 00:16:29,120 Speaker 3: both those resources are going to be very energy intensive 269 00:16:29,360 --> 00:16:35,560 Speaker 3: and environmentally intensive to develop. So my question to people 270 00:16:35,720 --> 00:16:40,240 Speaker 3: is is that really so assuming that you're happy to 271 00:16:40,280 --> 00:16:42,440 Speaker 3: be covered by that the oil reserves are covered, we 272 00:16:42,480 --> 00:16:46,160 Speaker 3: don't have to discover anymore. Are you happy that we 273 00:16:47,560 --> 00:16:50,560 Speaker 3: produce those reserves because that's what you're going to have 274 00:16:50,600 --> 00:16:53,920 Speaker 3: to be relying on, and that's going to be producing 275 00:16:53,960 --> 00:16:57,000 Speaker 3: a lot more CO two because ultimately all of that 276 00:16:57,160 --> 00:17:00,440 Speaker 3: energy that comes for processing has to come from from 277 00:17:00,480 --> 00:17:08,160 Speaker 3: burning things at the temperatures that you need, and it's 278 00:17:08,200 --> 00:17:11,639 Speaker 3: going to be very expensive oil so versus so. To 279 00:17:11,680 --> 00:17:14,199 Speaker 3: put that into perspective, there's a thing called the energy 280 00:17:14,280 --> 00:17:17,160 Speaker 3: return on investment for a barrel of oil. So that's 281 00:17:17,680 --> 00:17:20,600 Speaker 3: how many barrels of oil you get out for every 282 00:17:20,640 --> 00:17:23,719 Speaker 3: barrel of oil and energy that you put in. So 283 00:17:24,240 --> 00:17:28,480 Speaker 3: and oil sands will give you and Venezuelan bitchmen will 284 00:17:28,480 --> 00:17:32,480 Speaker 3: give you around about four or five barrels of oil 285 00:17:32,480 --> 00:17:37,439 Speaker 3: out for every barrel of oil invested. Offshore oil and 286 00:17:37,520 --> 00:17:42,159 Speaker 3: gas will give you around about somewhere between forty and 287 00:17:42,440 --> 00:17:45,399 Speaker 3: eighty barrels of oil for every barrel of oil of 288 00:17:45,560 --> 00:17:46,280 Speaker 3: energy invested. 289 00:17:46,440 --> 00:17:48,000 Speaker 1: So is it fair to say where people are looking 290 00:17:48,000 --> 00:17:51,680 Speaker 1: for oil, they're not necessarily looking for more oil net, 291 00:17:51,920 --> 00:17:53,440 Speaker 1: they're looking for more efficient oil. 292 00:17:53,680 --> 00:17:55,239 Speaker 3: To be honest, I would like to see a lot 293 00:17:55,280 --> 00:17:58,120 Speaker 3: of the Venezuelan bitchmen and a lot of the Canadian 294 00:17:58,160 --> 00:18:00,520 Speaker 3: oil sands stay right where they are. 295 00:18:00,640 --> 00:18:03,119 Speaker 1: Because they're just going to have more emissions associated with 296 00:18:03,160 --> 00:18:05,959 Speaker 1: them perl correct, are more efficient well correct, And then 297 00:18:06,000 --> 00:18:08,719 Speaker 1: I guess going back to that idea of displacing dirtier energy, 298 00:18:08,960 --> 00:18:12,359 Speaker 1: it's better that that is natural gas than it is 299 00:18:12,520 --> 00:18:16,320 Speaker 1: coal or correct a diesel, which we briefly were burning 300 00:18:16,320 --> 00:18:19,120 Speaker 1: in New Zealand the other day just some people's horror. 301 00:18:19,080 --> 00:18:23,359 Speaker 3: And we are mostly burning coal. So look the So 302 00:18:23,520 --> 00:18:28,600 Speaker 3: for the EV owners who are really wanting not to burn, 303 00:18:29,080 --> 00:18:34,560 Speaker 3: not to produce emissions, they really should. Transpower's got a 304 00:18:34,600 --> 00:18:40,920 Speaker 3: fantastic site that tells you at any given time in 305 00:18:40,960 --> 00:18:44,840 Speaker 3: the day, what's producing the power. So if the coal 306 00:18:44,880 --> 00:18:49,560 Speaker 3: fired power station is running, the reality is that you 307 00:18:49,680 --> 00:18:51,560 Speaker 3: have a choice over when you plug your battery in. 308 00:18:52,280 --> 00:18:54,680 Speaker 3: If you plug an in moll of power coal fired 309 00:18:54,720 --> 00:18:58,280 Speaker 3: power stations running, you are the reason the coal fired 310 00:18:58,320 --> 00:19:01,440 Speaker 3: power stations running. So those all of those electrons you're producing, 311 00:19:01,440 --> 00:19:03,959 Speaker 3: it doesn't matter whether who you who you buy your 312 00:19:03,960 --> 00:19:07,240 Speaker 3: power from. All the electrons that you're using are coming 313 00:19:07,640 --> 00:19:10,719 Speaker 3: effectively coming from that coal fired power station. Because you 314 00:19:10,760 --> 00:19:11,960 Speaker 3: are the marginal user. 315 00:19:13,320 --> 00:19:15,320 Speaker 1: You're effectively running your tiesler on coal. 316 00:19:15,600 --> 00:19:18,080 Speaker 3: You are effectively running the Tesla on coal, which is 317 00:19:18,320 --> 00:19:20,960 Speaker 3: look and a lot of people if that's really the reason, 318 00:19:22,000 --> 00:19:23,280 Speaker 3: have a have a bit of a look at that 319 00:19:23,320 --> 00:19:25,840 Speaker 3: Transpower up and you can you can sort of time 320 00:19:25,880 --> 00:19:27,840 Speaker 3: when you're when you're actually plugging in. 321 00:19:27,840 --> 00:19:29,840 Speaker 1: Because a lot of the time, a lot of the time, 322 00:19:29,840 --> 00:19:30,760 Speaker 1: we're not burning coal. 323 00:19:31,080 --> 00:19:34,359 Speaker 3: At the moment with low lie hydro lake sets, unfortunately 324 00:19:34,400 --> 00:19:38,040 Speaker 3: we're burning coal most of the time. But you're absolutely right, 325 00:19:38,080 --> 00:19:44,679 Speaker 3: in normal hydrological year, we are incredibly renewable. 326 00:19:45,240 --> 00:19:49,160 Speaker 1: I think you make a good case for exploration finding 327 00:19:50,320 --> 00:19:55,000 Speaker 1: more more efficient forms of fossil fuels. But let me 328 00:19:55,040 --> 00:19:57,200 Speaker 1: push back on that a little bit, because every time 329 00:19:57,240 --> 00:20:00,480 Speaker 1: you find a more efficient well with cheaper, cleaner energy, 330 00:20:01,920 --> 00:20:05,880 Speaker 1: that makes burning fossil fuels cheaper and cleaner, and therefore 331 00:20:05,920 --> 00:20:09,000 Speaker 1: like reduces the incentive to invest in these big batteries 332 00:20:09,000 --> 00:20:10,960 Speaker 1: that the tech's not quite there yet, but maybe people 333 00:20:10,960 --> 00:20:12,960 Speaker 1: would invest more in the tech. I think some of 334 00:20:13,000 --> 00:20:15,080 Speaker 1: the idea of the oil and gas ban was not 335 00:20:15,560 --> 00:20:17,520 Speaker 1: that we don't need gas, but that by banning it, 336 00:20:17,560 --> 00:20:20,560 Speaker 1: we would fast track the development of other technologies. Now 337 00:20:20,560 --> 00:20:22,560 Speaker 1: that's obviously maybe not the smartest thing to do as 338 00:20:22,560 --> 00:20:25,800 Speaker 1: a tiny country that isn't capable of developing those technologies. 339 00:20:25,800 --> 00:20:29,480 Speaker 1: But on a global network scale, if you keep finding cheaper, 340 00:20:29,560 --> 00:20:32,600 Speaker 1: more efficient forms of fossil fuels, won't that keep us 341 00:20:32,640 --> 00:20:35,200 Speaker 1: on them for longer and delay the transition. 342 00:20:36,880 --> 00:20:42,000 Speaker 3: A Look, it's a very good point, Dan, and I 343 00:20:42,200 --> 00:20:49,080 Speaker 3: think generally, in as humans have moved forward and not 344 00:20:49,200 --> 00:20:53,119 Speaker 3: for yet, we are part of a very privileged group 345 00:20:53,400 --> 00:20:55,920 Speaker 3: who enjoy a Western standard of living. There's a couple 346 00:20:55,920 --> 00:20:58,280 Speaker 3: of billion people who don't have any any you know, 347 00:20:58,280 --> 00:21:02,280 Speaker 3: who were cooking using stuff powered by dung or charcoal, 348 00:21:03,640 --> 00:21:07,880 Speaker 3: which causes a lot of health problems as well as 349 00:21:08,040 --> 00:21:12,280 Speaker 3: probably not being very efficient the you know. So we're 350 00:21:12,720 --> 00:21:16,440 Speaker 3: speaking from that. From that end of things, human progress 351 00:21:16,440 --> 00:21:19,639 Speaker 3: has generally been when things have gotten cheaper and better. 352 00:21:20,480 --> 00:21:23,880 Speaker 3: So I'm very happy. Look, I will be ecstatic if 353 00:21:24,880 --> 00:21:27,600 Speaker 3: technology comes along that puts me out of a job. 354 00:21:28,080 --> 00:21:32,520 Speaker 3: I'm very happy all those folks in those startups that 355 00:21:32,560 --> 00:21:37,840 Speaker 3: are developing fusion power or better batteries. You know, I 356 00:21:38,400 --> 00:21:41,879 Speaker 3: am very happy bring it on, because I think that 357 00:21:41,960 --> 00:21:47,679 Speaker 3: will be a really positive development for humanity. But you know, 358 00:21:47,960 --> 00:21:53,680 Speaker 3: we shouldn't be pushing up the price of things simply 359 00:21:54,119 --> 00:21:59,640 Speaker 3: to try to stimulate something that's you know, that's that's 360 00:21:59,640 --> 00:22:03,119 Speaker 3: not You could do it more effectively, and one of 361 00:22:03,160 --> 00:22:06,119 Speaker 3: the most effective ways of doing it would be to 362 00:22:06,240 --> 00:22:10,320 Speaker 3: put a global price on carbon. You have, full stop. 363 00:22:10,400 --> 00:22:12,359 Speaker 3: If we could have a global price on carbon. That 364 00:22:12,400 --> 00:22:16,480 Speaker 3: would be and then everybody or governments would then say, look, 365 00:22:16,480 --> 00:22:19,200 Speaker 3: we'll put the global price on carbon and will stop 366 00:22:19,240 --> 00:22:23,240 Speaker 3: stuffing around with all the other settings. That would be 367 00:22:23,440 --> 00:22:27,120 Speaker 3: phenomenal and we would embrace that as a I know 368 00:22:27,240 --> 00:22:30,320 Speaker 3: most of the oil and gas industry folks that I 369 00:22:30,359 --> 00:22:32,879 Speaker 3: talked to would absolutely love that because it would give 370 00:22:32,920 --> 00:22:38,119 Speaker 3: you certainty, it would give a level playing field, you know, 371 00:22:38,200 --> 00:22:41,200 Speaker 3: it would be it would be a really positive, positive thing. 372 00:22:42,200 --> 00:22:45,760 Speaker 3: But saying that you will restrict the world from having 373 00:22:45,800 --> 00:22:49,800 Speaker 3: access to a resource that they actually need and you 374 00:22:49,800 --> 00:22:54,359 Speaker 3: will push up the world's prices for energy is a 375 00:22:54,359 --> 00:22:56,640 Speaker 3: pretty hard thing to do, particularly to the people who 376 00:22:57,359 --> 00:22:59,879 Speaker 3: you know, it is the poorest people who end up 377 00:23:00,400 --> 00:23:03,480 Speaker 3: bearing the bearing the problem, which is. 378 00:23:03,560 --> 00:23:05,720 Speaker 1: I guess you know what. We are to a certain 379 00:23:05,760 --> 00:23:08,879 Speaker 1: degree witnessing here in New Zealand where we tried to 380 00:23:08,920 --> 00:23:12,560 Speaker 1: push gas out of the system. It didn't work. We 381 00:23:12,640 --> 00:23:15,080 Speaker 1: have some manufacturers shutting down. We're bringing it back into 382 00:23:15,080 --> 00:23:20,440 Speaker 1: the system. Ultimately, we tried to make it move faster, 383 00:23:20,560 --> 00:23:23,160 Speaker 1: we raise prices, but it didn't end up working. That's 384 00:23:23,160 --> 00:23:24,800 Speaker 1: the sort of thing you're thinking about there, yep. 385 00:23:24,960 --> 00:23:26,800 Speaker 3: And look, it's not it's not this is not a 386 00:23:26,840 --> 00:23:31,119 Speaker 3: New Zealand a New Zealand thing. Australia has done very 387 00:23:31,200 --> 00:23:33,160 Speaker 3: much the same thing on the East Coast of Australia. 388 00:23:33,200 --> 00:23:36,560 Speaker 3: You're saying the same, you know, the same argument play out, 389 00:23:37,760 --> 00:23:40,760 Speaker 3: and that will that is impacting their energy prices quite 390 00:23:40,760 --> 00:23:44,600 Speaker 3: a lot as well. Now we happen to be you 391 00:23:44,600 --> 00:23:48,320 Speaker 3: you know, you could argue that could be accused of 392 00:23:48,400 --> 00:23:52,760 Speaker 3: profiteering from that by continuing by we've upped our investment 393 00:23:52,800 --> 00:23:57,040 Speaker 3: in Central Australia, which is gas that's feeding into that 394 00:23:57,400 --> 00:24:00,679 Speaker 3: East Coast market, feeds into the Northern term market, but 395 00:24:00,720 --> 00:24:03,919 Speaker 3: also the East Coast market at the same time that 396 00:24:04,040 --> 00:24:06,640 Speaker 3: is allowing us to drill more wells. We will try, 397 00:24:06,920 --> 00:24:09,040 Speaker 3: you know, so we're trying to bring on more supply 398 00:24:09,960 --> 00:24:13,040 Speaker 3: to meet that demand because the demand really has to 399 00:24:13,119 --> 00:24:16,360 Speaker 3: be met otherwise you will shed demand and unfortunately you'll 400 00:24:16,400 --> 00:24:18,919 Speaker 3: shed the people. It'll be the people who can't afford 401 00:24:18,920 --> 00:24:23,880 Speaker 3: it that will end up not being able to pay all. 402 00:24:23,920 --> 00:24:26,920 Speaker 3: Manufacturer is being forced off suore. So you know, both 403 00:24:26,960 --> 00:24:31,280 Speaker 3: those things take away the jobs, they take away people's livelihoods, 404 00:24:31,320 --> 00:24:35,080 Speaker 3: and I think that's not particularly not a fair way 405 00:24:35,080 --> 00:24:36,399 Speaker 3: to play. 406 00:24:37,040 --> 00:24:39,359 Speaker 1: So you've moved to the A SX, you're having a 407 00:24:39,359 --> 00:24:40,879 Speaker 1: bit more of a focus on Australia. Can you talk 408 00:24:40,960 --> 00:24:42,480 Speaker 1: us through just some of the projects, some of the 409 00:24:42,520 --> 00:24:46,119 Speaker 1: stuff you're doing there, what the market opportunities and challenges 410 00:24:46,160 --> 00:24:47,720 Speaker 1: look like in Australia and elsewhere. 411 00:24:47,880 --> 00:24:52,320 Speaker 3: Sure. Look, we've got so we've been investing in Australia 412 00:24:52,359 --> 00:24:56,000 Speaker 3: over the last three or so years. We've been bought 413 00:24:56,040 --> 00:24:59,159 Speaker 3: into the Armada, a space in which is right smack 414 00:24:59,200 --> 00:25:01,960 Speaker 3: in the center of the We've got a couple of 415 00:25:02,040 --> 00:25:06,840 Speaker 3: gas fields there. We've drilled a we drilled a well 416 00:25:06,960 --> 00:25:10,040 Speaker 3: in a couple of years ago. That's been it's been 417 00:25:10,080 --> 00:25:13,440 Speaker 3: a solid producer in a field called Palm Valley. We're 418 00:25:13,440 --> 00:25:15,720 Speaker 3: about to drill a couple of wells in the Marini 419 00:25:15,840 --> 00:25:20,640 Speaker 3: field in the towards probably a start very first part 420 00:25:20,640 --> 00:25:25,800 Speaker 3: of next year. That we're looking forward to providing extra 421 00:25:25,880 --> 00:25:28,920 Speaker 3: volumes into that Northern Territory market. The Northern Territory market. 422 00:25:29,000 --> 00:25:34,080 Speaker 3: So one of the reasons our production has been flat 423 00:25:34,119 --> 00:25:36,760 Speaker 3: for the last year has been because the Northern Territory 424 00:25:36,760 --> 00:25:42,239 Speaker 3: has been suffering a gas shortfall which has interfered with 425 00:25:42,320 --> 00:25:44,520 Speaker 3: the with the flow of gas across into the East 426 00:25:44,560 --> 00:25:47,720 Speaker 3: Coast of Australia, so we've we've managed to mitigate that, 427 00:25:47,840 --> 00:25:51,960 Speaker 3: but it has impacted our production in the last year. 428 00:25:52,480 --> 00:25:54,840 Speaker 3: But we're looking forward to we're going to put more 429 00:25:54,880 --> 00:25:57,280 Speaker 3: gas and we've just done it. Had a long term 430 00:25:57,320 --> 00:26:02,160 Speaker 3: contract signed with the Northern Territory government and a Rare 431 00:26:02,200 --> 00:26:08,600 Speaker 3: Earth's miner to put gas into that Northern Territory market 432 00:26:08,640 --> 00:26:12,240 Speaker 3: for the next over the next six years. So we'll 433 00:26:12,280 --> 00:26:15,439 Speaker 3: be investing in additional wells and we're looking forward to 434 00:26:15,440 --> 00:26:17,680 Speaker 3: bringing some more gas into that market. 435 00:26:18,440 --> 00:26:20,520 Speaker 1: What causes the gas short for is that just lessened 436 00:26:20,560 --> 00:26:26,040 Speaker 1: the ground so they had difficulty. So they had a 437 00:26:26,080 --> 00:26:29,399 Speaker 1: field up in Western Australia that feeds across into the 438 00:26:29,400 --> 00:26:31,840 Speaker 1: Northern Territory had a problem has had a problem with 439 00:26:31,880 --> 00:26:35,840 Speaker 1: one of its wells, and that's simply meant there's less 440 00:26:35,880 --> 00:26:38,920 Speaker 1: gas going into the market than was expected. So it's 441 00:26:38,960 --> 00:26:42,760 Speaker 1: the sort of thing that can happen if you become 442 00:26:43,320 --> 00:26:46,320 Speaker 1: reliant on only. 443 00:26:46,080 --> 00:26:48,639 Speaker 3: A few sources of sources of fuel. 444 00:26:48,880 --> 00:26:50,840 Speaker 1: At a similar thing in New Zealand, haven't we where 445 00:26:51,440 --> 00:26:53,720 Speaker 1: the existing wells haven't produced quite as much as we 446 00:26:53,760 --> 00:26:56,240 Speaker 1: thought they would or just added to the jury crunch yep. 447 00:26:56,600 --> 00:26:58,359 Speaker 3: And look, we've been a part of that. So we 448 00:26:58,400 --> 00:27:00,600 Speaker 3: have continued to invest in New zeald where by no 449 00:27:00,760 --> 00:27:07,119 Speaker 3: means turning our back on New Zealand, and we are based. 450 00:27:07,160 --> 00:27:09,320 Speaker 3: We're based in New Zealand for a start, and that's 451 00:27:09,359 --> 00:27:15,680 Speaker 3: not that's not changing. We invested in the Coupe gas field. 452 00:27:15,720 --> 00:27:17,760 Speaker 3: We drilled the well. It was also it was one 453 00:27:17,800 --> 00:27:21,600 Speaker 3: of those disappointing wells. Hoping that we can get something, 454 00:27:22,600 --> 00:27:25,480 Speaker 3: you know, get more out of it over time. There's 455 00:27:25,480 --> 00:27:29,160 Speaker 3: some things we can do with it. But the long 456 00:27:29,240 --> 00:27:33,000 Speaker 3: and the short is Coupe gas Field has been a 457 00:27:33,040 --> 00:27:37,520 Speaker 3: fantastic field over its life. It's it's reserved bases doubled 458 00:27:37,560 --> 00:27:40,919 Speaker 3: over its field life without putting any new wells in. 459 00:27:41,880 --> 00:27:43,879 Speaker 3: So it's been a you know, that's a that's a 460 00:27:43,880 --> 00:27:47,439 Speaker 3: great field to have. It's been producing a lot of 461 00:27:47,440 --> 00:27:51,680 Speaker 3: the LPG that New Zealanders used for barbecuing and down 462 00:27:51,720 --> 00:27:56,000 Speaker 3: south for heating comes from the Coupe field. And look, 463 00:27:56,040 --> 00:27:59,520 Speaker 3: we drilled one well. And that can happen when you're 464 00:28:00,040 --> 00:28:03,399 Speaker 3: you're dealing with mother nature your drill and it's and 465 00:28:03,440 --> 00:28:06,560 Speaker 3: you get a disappointing result. It's one of the reasons 466 00:28:06,560 --> 00:28:11,680 Speaker 3: why there is a need to make reasonable returns from 467 00:28:11,720 --> 00:28:15,040 Speaker 3: the wells that do work. Is because and sometimes those 468 00:28:15,119 --> 00:28:18,480 Speaker 3: returns may seem unreasonable, but that's only because you don't 469 00:28:18,520 --> 00:28:22,480 Speaker 3: factor in all the other wells that don't work. And 470 00:28:22,560 --> 00:28:24,720 Speaker 3: it is just a it's a function of the business 471 00:28:25,359 --> 00:28:27,760 Speaker 3: that one well. It's a data point, it's not you know, 472 00:28:27,800 --> 00:28:30,600 Speaker 3: it doesn't write a field off. So now we've just 473 00:28:30,680 --> 00:28:33,439 Speaker 3: got to circle the wagons and figure out what we 474 00:28:33,520 --> 00:28:34,000 Speaker 3: do next. 475 00:28:34,680 --> 00:28:36,760 Speaker 1: Let me ask you about ESG investing. I feel like 476 00:28:36,800 --> 00:28:39,360 Speaker 1: that's become really big over the past couple of decades, 477 00:28:39,400 --> 00:28:43,040 Speaker 1: and almost every fund has some sort of ESG criteria 478 00:28:43,080 --> 00:28:45,800 Speaker 1: they look at. It differs between funds. What is that 479 00:28:45,960 --> 00:28:49,600 Speaker 1: like for you as a fossil fuel company? Has it 480 00:28:49,680 --> 00:28:52,280 Speaker 1: changed the type of investors that are interested in you? 481 00:28:52,360 --> 00:28:56,200 Speaker 1: What is it like being a listed natural gas company 482 00:28:56,680 --> 00:28:57,680 Speaker 1: in the era of ESG? 483 00:28:58,000 --> 00:29:01,480 Speaker 3: How is that for you? I think, Look, I think 484 00:29:01,520 --> 00:29:04,520 Speaker 3: it's currently we've gone through a period where it's been 485 00:29:04,600 --> 00:29:06,480 Speaker 3: viewed pretty negatively. 486 00:29:07,920 --> 00:29:09,920 Speaker 1: The fossil fuels. 487 00:29:10,280 --> 00:29:17,320 Speaker 3: Fossil fuels so also by the investing community. The look 488 00:29:17,360 --> 00:29:22,520 Speaker 3: but it's one of those trends sort of the you knows. 489 00:29:22,840 --> 00:29:26,920 Speaker 3: As we've talked about we see ourselves as actually pivotal 490 00:29:27,320 --> 00:29:33,000 Speaker 3: in making transition work, and I think that will that 491 00:29:33,200 --> 00:29:39,240 Speaker 3: is starting to become a bit better recognized. As that 492 00:29:39,280 --> 00:29:43,440 Speaker 3: becomes better recognized, I'm hoping that some of those funds 493 00:29:43,480 --> 00:29:46,600 Speaker 3: will start to say, actually, you know, if we really 494 00:29:46,640 --> 00:29:48,920 Speaker 3: want renewables to work, we're going to have to We're 495 00:29:48,920 --> 00:29:52,360 Speaker 3: going to invest in these folks as well. In the meantime, 496 00:29:52,400 --> 00:29:58,680 Speaker 3: we've been mainly the more retail shareholders who have who 497 00:29:58,720 --> 00:30:01,120 Speaker 3: have looked at us and gone, right, well, I can see. 498 00:30:01,200 --> 00:30:03,880 Speaker 3: I mean, if you'd invested in New Zealand oil and 499 00:30:03,880 --> 00:30:05,280 Speaker 3: Gas over the last year, you would have had a 500 00:30:05,320 --> 00:30:09,360 Speaker 3: twelve percent cash yield because we've had four point four 501 00:30:09,360 --> 00:30:12,760 Speaker 3: and a half sense of dividend. Just recently announced the 502 00:30:14,200 --> 00:30:16,840 Speaker 3: one and a half cent dividend at the end of 503 00:30:16,880 --> 00:30:20,400 Speaker 3: the financial year. What do they say? It's the short 504 00:30:20,480 --> 00:30:24,120 Speaker 3: term it's a voting machine in the markets, and long 505 00:30:24,200 --> 00:30:27,280 Speaker 3: term it's a weighing machine. I think I'm hoping that 506 00:30:27,360 --> 00:30:31,880 Speaker 3: the results that we get actually will in the longer 507 00:30:31,960 --> 00:30:35,760 Speaker 3: term folks. Folks will look at it and say, right, well, 508 00:30:35,800 --> 00:30:40,200 Speaker 3: this is the place that we should invest because we're 509 00:30:40,240 --> 00:30:41,080 Speaker 3: part of the transition. 510 00:30:41,720 --> 00:30:44,600 Speaker 1: One part of the ESG metrics I guess are about 511 00:30:44,760 --> 00:30:48,560 Speaker 1: sort of the ethics or about climate outcomes. But another 512 00:30:48,600 --> 00:30:50,720 Speaker 1: part people talk about just risk that don't want to 513 00:30:50,720 --> 00:30:54,560 Speaker 1: be left with stranded assets. What's your strategy for avoiding 514 00:30:54,600 --> 00:30:57,320 Speaker 1: stranded assets or being caught out in the transition? Would 515 00:30:57,320 --> 00:30:59,200 Speaker 1: you look at going to renewables or what kind of 516 00:30:59,600 --> 00:31:00,720 Speaker 1: runway do you think you have? 517 00:31:01,000 --> 00:31:04,400 Speaker 3: Look, we've tended to focus on assets where we can 518 00:31:04,480 --> 00:31:13,640 Speaker 3: invest and get results sooner rather than later, which puts 519 00:31:13,640 --> 00:31:18,200 Speaker 3: you into putting wells into existing fields, increasing reserves in 520 00:31:18,280 --> 00:31:20,680 Speaker 3: existing fields that are connected to markets where you're not 521 00:31:20,720 --> 00:31:25,800 Speaker 3: having to put in the long term, decades long investment, 522 00:31:27,800 --> 00:31:30,720 Speaker 3: and then relying on a market being there in twenty 523 00:31:30,840 --> 00:31:34,680 Speaker 3: years time. So we're very much investing in a way 524 00:31:34,720 --> 00:31:39,200 Speaker 3: that says we'll know we'll be producing that gas in 525 00:31:39,240 --> 00:31:41,600 Speaker 3: a year's time and putting it into a market that 526 00:31:41,640 --> 00:31:46,440 Speaker 3: we know is there and we know its healthy. I 527 00:31:46,480 --> 00:31:50,440 Speaker 3: think some of the strategic planners bigger in bigger companies 528 00:31:50,480 --> 00:31:54,200 Speaker 3: would definitely you'd start to worry if you were looking 529 00:31:54,200 --> 00:31:56,640 Speaker 3: at a project that was twenty years in the making, 530 00:31:58,080 --> 00:32:01,520 Speaker 3: would you do that? Ultimately comes down to what your 531 00:32:01,520 --> 00:32:03,840 Speaker 3: shareholders want. If you've got shareholders who want to put 532 00:32:03,880 --> 00:32:10,400 Speaker 3: the money in, well, then away you go. But from 533 00:32:10,560 --> 00:32:13,320 Speaker 3: our perspective, we've very much focused on things that are 534 00:32:13,840 --> 00:32:16,880 Speaker 3: near a term and then look, we'll see, We'll wait 535 00:32:16,920 --> 00:32:21,040 Speaker 3: and see. I think there's a new Zealand gas market 536 00:32:21,400 --> 00:32:24,480 Speaker 3: is obviously going to be around for another few decades, 537 00:32:26,240 --> 00:32:30,000 Speaker 3: the Australian gas market probably for longer still, so that 538 00:32:30,680 --> 00:32:33,120 Speaker 3: exceeds any reserves life that we've got at the moment. 539 00:32:33,200 --> 00:32:38,480 Speaker 3: So that's really been the way we've dealt with that well. 540 00:32:38,520 --> 00:32:41,160 Speaker 1: Andrew, thanks for coming on. I think you have just 541 00:32:41,520 --> 00:32:43,080 Speaker 1: reported your financial results. 542 00:32:43,120 --> 00:32:47,640 Speaker 3: When was there, Look, it was last week we reported 543 00:32:47,640 --> 00:32:51,040 Speaker 3: our financial results. We've got some good numbers, you know, 544 00:32:51,080 --> 00:32:55,560 Speaker 3: the building the business is building along quite well. We're 545 00:32:55,600 --> 00:32:59,040 Speaker 3: in some good markets, we've got some good long term contracts. 546 00:32:59,200 --> 00:33:02,640 Speaker 3: We're drilling some else in the next year. So you know, 547 00:33:02,640 --> 00:33:05,360 Speaker 3: I'd recommend anybody who wants to could certainly have look 548 00:33:05,400 --> 00:33:11,560 Speaker 3: at our at our website www. Dot Echelon Resources dot 549 00:33:11,600 --> 00:33:14,040 Speaker 3: com and you know, have a look at the have 550 00:33:14,040 --> 00:33:14,880 Speaker 3: a look at the results. 551 00:33:15,000 --> 00:33:15,719 Speaker 1: Thank you for coming on. 552 00:33:15,760 --> 00:33:18,160 Speaker 3: It's great to chat and look to any of those 553 00:33:18,200 --> 00:33:23,120 Speaker 3: folks out there, you know, very happy. I think to 554 00:33:24,160 --> 00:33:28,400 Speaker 3: have shareholder questions and things at our AGM. Very happy, 555 00:33:28,400 --> 00:33:32,000 Speaker 3: happy to be interactive, and it's great to see people 556 00:33:32,040 --> 00:33:36,280 Speaker 3: investing and to see shares is providing a platform brilliant 557 00:33:36,320 --> 00:33:37,160 Speaker 3: to come and have a chat. 558 00:33:37,240 --> 00:33:39,520 Speaker 1: Thank you everyone for tuning in. 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