New Zealand Halts Future Oil And Gas Offshore Exploration Permits

The Labour Government has stopped permits for onshore oil and gas exploration

New Zealand's oil and gas industry is a sizeable part of the country's economy, but it'll be stopping all new offshore exploration to address climate change.

For all of Ardern's claims that climate change is her generation's nuclear free moment, the industry will in all likelihood continue to operate for decades. "It certainly has nothing to do with climate change", he said.

New Zealand's oil and gas production comes from the Taranaki region, in the northeast.

Ardern surprised the oil and gas industry with her announcement, which won't impact the 22 existing exploration permits, Reuters said.

NZOG is the permit-holder for the Barque exploration prospect, off the Canterbury coast, which Energy Minister Megan Woods said today held potentially "trillions of cubic metres of gas" which could still be exploited if NZOG made a discovery there.

And Seymour told Leighton Smith that rather than protecting the environment, the move will actually have the opposite affect. 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.

Mr Madgwick said there had been "no direct consultation" with the sector and asked the Government to "talk with the industry urgently". Russel Norman, the group's executive director in New Zealand, said the country "has stood up to one of the most powerful industries in the world".

NZOG says the ban on new exploration may mean carbon emissions in New Zealand and globally will be higher for longer.

"Industry interest in New Zealand oil and gas is actually higher now than it has been for a number of years", Rodger said, pointing to recent investments by companies such as Austria's OMV Group (OMVKY) and Malaysia's Sapura Energy. "These changes will simply shift production elsewhere in the world, not reduce emissions", he said.

Ardern came to power a year ago after her Labour Party and its ally the Greens campaigned on policies to protect the environment, including moving away from a reliance on fossil fuels.

Senaratne said with global oil prices rising, the government is keen to revive and fast-track the search for petroleum resources in the island country.

"This decision may raise doubts among investors as to the viability of investing in New Zealand businesses", BusinessNZ chief Kirk Hope said.

Climate Justice Taranaki member Urs Signer welcomed the Government's decision to cease offshore permitting, but criticised the continued onshore permitting around Taranaki, describing it as "continuing to sacrifice Taranaki for political trade-off".