New Zealand’s proposed liquefied natural gas (LNG) import terminal faces an uncertain future after Prime Minister Christopher Luxon stated on March 30 that the government would only approve the project if its economic rationale proved sound. The facility, slated for construction in Taranaki on the North Island, was initially shortlisted for contractors in February, with plans to begin receiving LNG by 2027 or early 2028. The government had announced the initiative in 2025 to enhance energy security and reduce costs amid declining domestic gas production.
In a Monday interview with Radio New Zealand, Luxon emphasized that the procurement process remained ongoing, with multiple bidders under consideration. However, he clarified that the project’s viability hinged on its economic returns and cost-benefit analysis. “If it’s not an attractive commercial case, we won’t be doing it,” he said.
The terminal aims to stabilize electricity supplies by importing LNG in bulk during periods of shortage, particularly in dry years when low hydroelectric generation—due to reduced lake and dam levels—increases reliance on coal and diesel. The proposed model seeks to minimize prolonged exposure to volatile global gas prices by limiting imports to essential periods. Energy Minister Simon Watts has estimated the project’s cost at approximately NZ
1billion(
600 million), with an annual import capacity of 12 petajoules.
