New Zealand bans new offshore oil, gas explorations

New Zealand bans new offshore oil, gas explorations

New Zealand bans new offshore oil, gas explorations

New Zealand has banned fresh offshore oil exploration in one of the boldest political moves yet to tackle global climate change.

Green Party co-leader James Shaw tried to help push that line by saying that while he welcomed the move, drilling would continue for longer than he or his party felt comfortable with.

"There will be no further offshore oil and gas exploration permits granted", Prime Minister Jacinda Ardern said today.

Today's decision "does not affect current reserves or the potential finds from current exploration permits".

New Zealand imports more oil than it exports, and it is a small player on the world stage, with industry figures putting the value of exports at $1.1 billion a year.

Greenhouse gas emissions will, therefore, remain the same, or be even worse, because processes used by other oil and gas producers are often less efficient.

Meanwhile, the chief executive of BusinessNZ, Kirk Hope, said the new policy would raise questions in investors' minds about the viability of investing in New Zealand. It began winding down production in New Zealand in the mid-2000s when it appeared that gas supplies were running low, but ramped up investment at its plants at Motonui and Waitara as gas supply improved.

Ardern said: "In each of the last two years only one permit has been granted for offshore oil and gas exploration". It added that more than 11,000 people work in the oil and gas industries during "peak times", and that jobs would be affected given that companies had made "huge" investments anticipating offshore "block offers", which would not be made under the government's announcement. "These permits cover an area of 100,000 sq kms [38,610 square miles] almost the size of the North Island, and run as far out as 2030 and could go an additional 40 years under a mining permit", she said.

Energy and Resources Minister Megan Woods announced the start of consultation with iwi and hapu on the 2018 Block Offer for an area restricted to the onshore Taranaki Basin covering a 1,703 square kilometre area.

The energy industry slammed the government for banning offshore exploration while environmentalists praised it.

But the conservative opposition National Party accused Ardern of "economic vandalism" that could put thousands of jobs at risk.

"This decision is devoid of any rationale".

The Prime Minister said that she has taken a responsible step which will give certainty for businesses and communities that depend on fossil fuels. "These changes will simply shift production elsewhere in the world, not reduce emissions", he said.

"Just ask yourself: Would you trust the environmental regulations in Indonesia, or in New Zealand?"

The announcement does not apply to onshore exploration permits.

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