Serving oil industry could benefit Nelson

The oil and petroleum industry has the potential to be New Zealand's biggest exporter and Nelson companies could set themselves up to service the industry throughout Australasia, a leading American investment manager says.

William Buechler, lead portfolio manager of the Kiwi Pacific Fund, said oil was currently ranked third behind dairy and meat in New Zealand, and last year brought in $3 billion.

However, with the Government talking about future annual income of 10 times that amount, it would take only a few more discoveries to make it the country's No1 export.

Several promising sites are to be explored.

"I'm looking for surprisingly positive results out of those," he said.

They include new sites around Taranaki, and exploration permits being granted for outer Tasman Bay.

Mr Buechler was in Nelson last week speaking to the Nelson Tasman Chamber of Commerce Venture Accelerator Network.

Recent announcements that next year will see the largest number of seismic surveys underneath the sea floor were encouraging, Mr Buechler said, as was the Government's policy of allowing petroleum firms to study the results.

"To get a company thinking about committing the billions of dollars it takes to do the exploration, you've got to give them something to look at."

Mr Buechler said Nelson had the potential to set itself up as a base to service the oil industry, not only in New Zealand, but also stretching into Australia.

"The Government support is there. You could really develop a complete industry here as oil service and support, much like the Norwegians have done.

"Ultimately, service companies could be operating throughout New Zealand and then all through Australasia, if it works out right."

From nothing in the mid-1990s, the Norwegian oil industry was now worth half-a-trillion dollars.

Mr Buechler, who is based in San Diego, said New Zealand was increasingly becoming noticed by investors as a place with good potential and limited risk.

In particular, there were several companies on the right track but under-developed.

"I just looked at it a couple of years ago and decided petroleum development and petroleum resources was going to be a long-term, multi-decade opportunity."

It was also starting to attract attention from sovereign wealth funds, which invest in commodities and natural resources, he said.

"That's trillions of dollars of potential asset flow, which could have a huge impact on New Zealand as all this happens."

- © Fairfax NZ News