Govt Introduces Legislation to Reinstate Offshore Petroleum Exploration

Crown Minerals Amendment Bill aims to address energy security, boost investment in oil and gas, and support regional economies by lifting the ban on offshore exploration.

The Coalition Government has introduced the Crown Minerals Amendment Bill, reinstating offshore petroleum exploration as a crucial measure to tackle the country’s growing energy security challenges. The legislation reverses the ban on new oil and gas exploration beyond onshore Taranaki and seeks to revitalize investment in the petroleum sector, a move that Resources Minister Shane Jones says is necessary to secure New Zealand’s energy future.

The Bill also aligns decommissioning settings with international best practices and offers greater certainty for potential investors.

“This Bill delivers on commitments in both the National-NZ First and National-ACT coalition agreements, and addresses the Government’s urgent promise to improve energy security and affordability,” said Jones. Key Provisions of the Crown Minerals Amendment Bill:

Reversing Offshore Exploration Ban: The legislation lifts the ban on new oil and gas exploration beyond the onshore Taranaki region. Jones emphasized the importance of natural gas for maintaining a secure and affordable energy supply, particularly as the country faces declining gas fields and the challenges of relying solely on renewable energy sources.

“Without further investment in existing and new gas fields, supply issues and high prices will persist when our renewable energy generation is at capacity. This Bill will help ensure that New Zealanders have access to affordable energy,” said Jones.

Supporting Industry and Regional Economies: The Minister stressed the negative impact of limited gas supply on both household energy costs and the industrial sector, where some large employers have been forced to halt production due to high energy prices. The legislation is expected to stabilize gas supplies and alleviate the financial pressure on businesses, helping to prevent further closures, especially in regional New Zealand.

“Natural gas is critical for keeping the lights on and our homes warm, and it’s also vital for keeping our regional industries running. We can’t afford to ignore the benefits this sector brings to our economy and our workforce,” Jones added.

Balanced Regulation and Investor Confidence: The Bill also introduces regulatory adjustments to balance the burdens of exploration permits and the risks of decommissioning, giving the sector the confidence needed to invest in both current and future projects. This is expected to attract new investment and further strengthen New Zealand's energy security.

Introducing Small-Scale Gold Mining Permits: The legislation also includes a new tier of mineral permitting to facilitate small-scale, non-commercial gold mining. This change aims to simplify the process for individuals and small operators interested in gold mining, contributing to regional economic diversification.

The Bill is scheduled for its first reading today and will be referred to the select committee, with the Government aiming to pass the legislation by the end of the year. To meet this timeline, the select committee process will be fast-tracked.

Jones highlighted the importance of this legislative change, noting that New Zealand’s petroleum and mineral resources contribute billions to the country’s GDP, create high-paying jobs, and help diversify regional economies.

“I’m not willing to let the significant benefits of this sector pass us by,” Jones concluded.

The Crown Minerals Amendment Bill is seen as a major step toward ensuring New Zealand’s energy stability and economic resilience, particularly in light of the challenges posed by declining gas supplies and increasing demand for affordable energy.