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Protesters are vowing direct action in southern waters after oil giant OMV was yesterday cleared to drill up to 10 exploration wells off the Otago coast beginning this summer.
The announcement by the Environmental Protection Agency prompted Dunedin Mayor Aaron Hawkins to label the process a "farce" last night, saying it overlooked mounting concern about climate change.
"It’s not surprising. That doesn’t make it any less disappointing," he said.
Oil Free Otago spokesman Jack Brazil also criticised the move and said protesters would be waiting for the oil giant when it arrived in southern waters.
The EPA’s decision, coming just months after 170,000 people took to the streets in nationwide Strike for Climate protests, was "just farcical", and OMV could expect direct action here, Mr Brazil said.
"It’s just going to be complete opposition every step of the way."
However, Otago Chamber of Commerce chief executive Dougal McGowan was cautiously upbeat about the news.
Rigorous monitoring would be needed to ensure any environmental impact from a drilling programme was managed, but the city could also benefit economically if it was used as a support base for OMV, he said.
The oil giant, which is at present drilling off Taranaki, had already been granted a discharge consent associated with its previously announced plan to drill the Tawhaki-1 well, 146km southeast of Balclutha, later this summer.
OMV had said only one well — costing up to $80million — was planned, but yesterday’s EPA decision expanded the possible scope of the drilling programme to up to 10 exploration and appraisal wells by 2030.
The Tawhaki-1 well site lies in 1300m of water, in part of the Great South Basin which OMV and partner Mitsui have been exploring for 12 years but have yet to drill.
The EPA, in granting approval, concluded that the possible effects of the drilling were "not significant" and environmental monitoring would be required before and after drilling.
However, its decision also noted it was specifically prohibited by legislation from considering concerns about climate change as part of the decision-making process.
Mr Hawkins said it was "frustrating" public concern about climate change had not been heard as part of the submissions process, which was limited to a narrow consideration of discharge consents.
That overlooked the bigger picture of rising CO2 emissions and increasing push-back from communities up and down the country, including in Dunedin, he said.
"We know that we can’t use even a quarter of the known oil and gas reserves if we’re to have any shot at reaching the targets we set under the Paris Agreement.
"So going out looking for more on top of that seems like the definition of madness to me."
However, those in favour of gas exploration point to it as a critical transition fuel to help the world meet rising energy demand while also displacing higher-emitting fuels such as coal and oil.
OMV Australasia senior vice-president Gabriel Selischi said the company had put a lot of work into ensuring the drilling programme met world best practice.
"The exploration efforts will be very important for New Zealand's energy future and we welcome the robust conditions that the consent is subject to," he said.
— Additional reporting by BusinessDesk