New Zealand is at the start of a 40-year cycle in oil and gas
exploration, beginning with at least three oil rigs drilling
up to 13 holes during the year ahead, government permitting
agency New Zealand Petroleum and Mining (NZPAM) says.
Minister for Energy and Resources Simon Bridges opened the
annual petroleum conference in Wellington yesterday, telling
the 300 delegates more than $8 billion had spent in
exploration in the sector in the past six years, and that
$300 million in corporate tax and $400 million in royalties
had been reaped in the past calendar year.
''If any one of the other 17 basins have the same [oil and
gas resources] of Taranaki, that would be a game changer for
the sector,'' Mr Bridges said.
Mr Bridges announced formal consultation was starting today
for the 2014 block tender offer, which includes the combined
Great South and Canterbury Basins, Pegasus Basin off the
Wairarapa coast, the Reinga and Northland Basins in northwest
New Zealand, the New Caledonia Basin and the offshore
Taranaki Basin. Mr Bridges' message was similar to the one he
expressed at a recent mining conference in Nelson but the
potential profits are higher, oil and gas providing almost
three times the returns.
The successful applicants in the 2013 block offer will be
announced next Thursday, while the 2014 offer will start
consultation with regional authorities and iwi, tenders
closing by the end of November and successful applicants
announced in April next year.
There were 21 nominations for areas from 11 companies.
''New Zealand has a large number of opportunities. Demand for
oil and gas has never been better,'' Mr Bridges said.
There had been a surge in export receipts of crude oil since
2008, which had underpinned a tripling of petroleum exports,
There would be ''significantly more'' investment in the
sector by the Government, Mr Bridges said.
He highlighted technical data collation work by NZPAM, which
has had boosts to its budgets, and its availability, and said
the relatively new High Hazard Unit of the Government could
expect to see its budget boosted from $50 million to $80
With New Zealand having had only one basin, Taranaki, of its
18 basins explored,
the country's 6 million sq km were ''underdeveloped'',
something the Government wanted to see changed, Mr Bridges
In an interview later, Mr Bridges acknowledged
environmentalists were raising concerns, especially with
regard to deep-sea drilling, such as has been proposed around
Recent regulatory changes targeted safer work practices and
worked to ensure companies were capable of carrying out
exploration safely, he said.
On the question of non-notification of resource consent
applications, Mr Bridges defended this lack of public
consultation, noting non-notification covered only
exploration and if production from a hole started, it would
be publicly notified.
''It is about finding a balance of the risks ... The
consenting process should not be taking years,'' Mr Bridges
said. For example, Bathurst Resources' consents had been tied
up for two years by legal challenges, he said.
Also potentially contentious would be projects of national
importance being singled out for special fast-tracking, he
Asked where ''the line in the sand'' was with regard to
overriding public opinion and fast-tracking a project, Mr
Bridges said all relevant criteria would ''ultimately'' end
up with the Environmental Protection Authority (EPA).
NZPAM general manager David Binnie said New Zealand had begun
to ''build momentum'' in the past two years, test well
numbers per annum rising from 37 in 2009 to 45 in 2010 to 52
While the industry was ''lifting its game'', only Taranaki
had been targeted, and the scope had ''the potential to be
much bigger'', 2014's offer being the five offshore and three
Many legislative and regulatory changes were under way, Mr
''We're setting this up for long-term success.
''It's a 40-year cycle - we're on the edge of a new resources
era,'' Mr Binnie said. Critical to success was responsible
development, which would involve raising environmental and
health and safety standards, Mr Binnie said.