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Commissioner Dr Jan Wright's second report emphasises the most recent regulatory changes by the Government, including the recently updated Petroleum Exploration and Extraction Regulations and operation of the new High Hazards Unit, do not go far enough.
Environment Minister Amy Adams and Energy and Resources Minister Simon Bridges said the report was a ''useful contribution'' to discussion on how best to manage the environmental effects of onshore petroleum development, including fracking.
''We do need to consider how the industry may develop in the future. Ministers will analyse and consider the commissioner's recommendations,'' they said in a joint release.
Dr Wright, in calling for a ''national policy statement'', with emphasis on fracking, or ''unconventional'' drilling methods, said using the experience from Taranaki operations elsewhere was not adequate.
''It makes no sense for various councils to all be reinventing the wheel,'' she said in the report's overview.
''A major theme in this report is the unjustified variation in council plans and consent conditions,'' Dr Wright said.
''The Minister for the Environment [Ms Adams] has proposed a national planning template with standardised layout and terminology - this will help, but more is needed,'' Dr Wright said.
Ms Adams and Mr Bridges said that in March this year, the Government had released guidelines to clarify regulatory roles and help councils manage the effects of onshore petroleum development, including hydraulic fracturing.
That 180-page document includes a section on whether fracking should be publicly notified under ''special circumstances'', the most important clause allowing the public to have their say.
It suggests ''special circumstances must be more than: where a council has had an indication that people want to make submissions; the fact that a large development is proposed; the fact that some persons have concerns about a proposal''.
Even if a regional council found ''special circumstances'', it retained the discretion on whether to publicly notify the application.
Dr Wright said: ''In Taranaki, remarkably, a resource consent is not needed to drill for oil and gas. Outside Taranaki, drilling an oil and gas well generally does require a consent from the regional council, but the council does not have the option to say no,'' she said.
Because councils judged the effects of single wells to be ''minor'', resource consent applications were not being publicly notified, she said.
''Understandably, some perceive this as `regulatory capture', that is, seeing councils as acting in the benefit of the [oil and gas] industry, rather than in the public interest,'' Dr Wright said.
Ms Adams said the guidelines to clarify regulatory roles and help councils provided support to ensure that hydraulic fracturing was managed in a sound and responsible way. The environmental risks could be effectively managed if best practice was followed, she said.
''These guidelines provide clear direction so that hydraulic fracturing is carried out in a robust, controlled and well-regulated manner,'' Ms Adams said.
Dr Wright said the ''few highly trained inspectors'' of the High Hazards Unit would enforce drill site controls, but this would be ''far more sensibly done by regional council staff''.