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Government ends offshore oil and gas exploration

New Zealand will have to revert to burning coal in 10 years, National's Todd Muller says.

Dane Ambler
Thu, 12 Apr 2018

National MPs Jonathan Young and Todd Muller say the Coalition government end to offshore oil exploration permits decision is “economic vandalism.”

But Prime Minister Jacinda Ardern says the coalition government is taking an important step to address climate change and create a clean, green and sustainable future for New Zealand.

“We are protecting existing exploration and mining rights. No current jobs will be affected by this as we are honouring all agreements with current permit holders.”

The government will continue onshore block offers for the next three years but Energy and Resources Minister Megan Woods says there will be no new offshore block offers, meaning corporations will be unable to bid for new permits. Ms Woods says the block offer will be limited to onshore acreage in Taranaki alone.

There are 31 oil and gas exploration permits active, of which 22 are offshore.

These permits cover an area of 100,000 square kilometres, nearly the size of the North Island. They run as far out as 2030 and could go an extra 40 years under a mining permit.

Ms Ardern says the government is making careful and considered changes over time and supporting communities with a managed transition.

“There is a point where we have to say, ‘now is the time to plan,' and say 'Actually let’s use what we have got but let’s look to alternatives.’”

“The whole world is going in this direction. We all signed up to the Paris agreement that said we were moving towards carbon neutrality, and now we need to act on it.”

Last month Ms Ardern said she was "actively considering" the end of offshore exploration.

Ms Ardern previously said the government will move toward having 100% of electricity generation coming from renewable sources by 2035.

Green Party co-leader James Shaw says the move is a “massive step” toward a stable climate and to protecting New Zealand marine life and beaches.

“Ending deep sea oil and gas exploration has long been a key goal of the Green Party and today, in government, we’ve delivered on it.

“The decision means our beaches, coastlines and marine life are now far less likely to be affected by a Deepwater Horizon-style oil spill in the future.”

Mr Young says without exploration there will be no investment in oil and gas production or the downstream industries, resulting in fewer jobs.

“This decision is devoid of any rationale. It certainly has nothing to do with climate change.   These changes will simply shift production elsewhere in the world, not reduce emissions." 

Mr Muller says the decision makes no sense – environmentally and economically.

“Our current reserves will last less than 10 years – when they run out we will simply have to burn coal instead, which means twice the emissions.”

Mr Muller says by stopping New Zealand’s gas exploration, the government is turning its back on an opportunity to help reduce global emissions while providing a major economic return to improve our standard of living and the environment.

“We need to reduce global CO2 emissions. But there is no need to put an entire industry and thousands of New Zealanders’ jobs at risk.”

Last week Regional Development Minster Shane Jones launched the Taranaki Regional Economic Development action plan, which identifies ‘four futures’ for the region, including energy. Taranaki is the country's biggest oil and gas producing region.

“The initial money the Provincial Growth Fund (PGF) committed to investigate establishing Taranaki as an internationally recognised leader in clean energy technology is an example of the collaboration needed between government and the energy sector,” Mr Jones Says.

“I was heartened by the conversations I had with various stakeholders, who show a genuine willingness to lead the way and seize the opportunities that the transition provides us with.

Mr Jones says the block offer does not affect any jobs that are already there.

He says New Zealand First’s support is predicated by its commitment to protect the rights of existing permit holders to ensure certainty for all of those in the industry that currently hold exploration, prospecting and mining permits.

Those permits continue as far out as 2046.

RELATED VIDEO: Energy Minister Megan Woods on the future of the oil industry (Mar 21)
Dane Ambler
Thu, 12 Apr 2018
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Government ends offshore oil and gas exploration