Crown Minerals Amendment Act 2013 Amendment Bill

I move, That the Crown Minerals Amendment Act 2013 Amendment Bill be now read a first time. The Crown Minerals Amendment Act 2013 established a new approach to the Crown’s management of the petroleum and minerals estate. It streamlined and simplified the regime where appropriate, bringing it into line with the regulatory reform agenda, and made it better able to deal with future developments. Regulatory attention has been focused on key industry work programme deliverables that have the potential to generate significant value to New Zealand. Equally, tighter controls have been introduced so that when non-compliance arises, swift and decisive action is possible.

It has been brought to my attention that there was a significant omission in the transitional provisions for the Crown Minerals Amendment Act. This meant that a small number of existing privileges in the form of licences to mine a range of minerals that were granted under Acts that have now been repealed, such as the Mining Act 1971, would not be covered by the Crown Minerals Amendment Act. In order to guarantee certainty for the operators affected and to ensure that the Crown can manage these resources effectively, I have decided to amend the Act at this time. I also propose a small number of other amendments. The amendments that I propose to make can be summarised in four categories: those resulting from a minor policy change, those that deal with transitional issues such as the one that I have just outlined, amendments to drafting to implement policy intent, and amendments clarifying drafting where necessary.

It has been brought to my attention by officials and by the industry that operators who seek to obtain a permit to begin to explore for petroleum with a view to bringing on board a joint-venture partner at a later stage to confirm the resource through drilling and to operate a subsequent mining permit, could be excluded from the current regime. This is because the initial operator would not be able to pass the increased financial, technical, and health and safety capability assessments that the new Act requires, as these currently apply to all activities up to and including drilling a well. In order to allow these operators to be awarded permits through a competitive bidding round, I propose to include an alternative option where the assessment can be applied to the initial elements of the exploration work programme. Any permit awarded through this process will contain additional conditions to ensure that the operator, including any operating partner that they bring in, is able to satisfy the financial, technical, and health and safety requirements for the later stages of the exploration work programme. This approach ensures that the newly strengthened capability assessment remains in place but is more responsive to the way in which parts of the industry operate.

Another newly identified issue relates to the tier status of permits for platinum group elements. Tier 1 permits are those that are subject to a high degree of regulatory oversight, and a mining permit’s tier status is determined based on the estimated annual production, with different thresholds for different minerals. The threshold for metallic minerals other than gold and silver is currently set too high, meaning that future platinum tier 1 mining permits would be unlikely. I propose to lower this threshold for platinum group elements to ensure that the definition of tier 1 permits captures permits for these high-value, complex operations, as is consistent with the policy intent of the two-tiered permit management regime that the Act introduced. The proposed change is to set the threshold for platinum group elements at the same level as that for gold and silver.

As I have already mentioned, there are elements of the transitional provisions for existing privilege holders that I propose to amend. I propose to amend the Act to ensure that it applies to licences applied for prior to the Crown Minerals Act but granted after the Act came into effect in 1991. These are the existing privileges that are currently omitted from the Act. I also intend to clarify how certain elements of the Act apply to existing privilege holders, including clarifying that if there is a change of operator, they must be approved and pass the health and safety capability assessment; that data can be shared between regulators and the management of these existing privileges; and that there is consistent treatment of conditions for holders of permits in existing privileges regarding data confidentiality, reporting requirements, and the treatment of pending applications.

There are some instances where I propose to amend the drafting of the Act to reflect the original policy intent. A new offence was included in the Act relating to interference with offshore petroleum and mineral activities. The offshore area to which the new offences apply was intended to include all of the continental shelf and exclusive economic zone. Parts of the exclusive economic zone that are not above the continental shelf have been inadvertently excluded, as are parts of the continental shelf that extend beyond the exclusive economic zone, and I propose to rectify this.

The Act refers to providing information on reserves. Reserves are mineral resources that are commercially recoverable. Resources are all quantities of minerals naturally occurring in the ground, including all reserves. It is important that the Crown is able to collect data on mineral resources in order to manage effectively New Zealand’s petroleum and minerals estate. I propose that all instances of “reserves” should be changed to “resources” to ensure that regulations under the Act can set out the information on mineral resources that is provided by permit holders. I also propose to make minor amendments to the definition of “underground gas storage facility” to clarify the confidentiality provisions of certain data classes and the treatment of a permit as property. Through this bill, Government is continuing work on all fronts to ensure that the industry is bound by rules that appropriately reflect the risk profile associated with it. This bill also ensures that the changes to the regime can be implemented to their fullest extent in a consistent manner across the industry.

This bill is important for the future of responsible development of New Zealand’s oil, gas, and mineral resources, and will ensure the future contribution of these resources to the New Zealand economy. I commend this bill to the House.

I think the best response to that speech is “Really?”. Really, Minister? We passed this bill, the Crown Minerals Amendment Act 2013 Amendment Bill, only weeks ago, it is not even in force yet, and already we are back here in the House having to clean up the mess because there were so many mistakes. That is a whole new level of incompetence that I do not think we have seen in Ministers so far. I mean, it is still warm, this piece of legislation. It is still warm. The body has not cooled down, and here we are having to pass an amendment bill under urgency to fix all the mistakes in it.

Unfortunately, the reality is that this amendment bill is so shabby—and is being rushed through all stages tonight and tomorrow, and not going to a select committee—that we are probably going to have to come back for another amendment bill to fix the mistakes in this amendment bill. Well, Simon Bridges has completely outdone himself. This is a whole new level of incompetence. He has set a new record, and I challenge any Minister over there to beat it. The talent is certainly there—the talent is certainly there. It is going to be a hard task to beat it, but I think they can.

This is not a minor, technical bill, as the Minister of Energy and Resources would have us believe. The original bill, as he pointed out, significantly changed the way the Crown minerals regime worked in New Zealand. There were elements of that bill that the Labour Party supported, which included the implementation of the recommendations of the Pike River inquiry. That was really good. Unfortunately, the rest of it was nothing more than a developer’s charter with scant regard for the environment, and, as the Labour Opposition, we were not able to support it.

I want to welcome the approaches that were made by the Hon Phil Heatley, when he held the portfolio, to try to come to some cross-party agreement on this very important piece of legislation. We welcome that. Unfortunately, he was turfed out of the portfolio. We now have Simon Bridges, and Simon Bridges does not seem to want to provide that security for industry. He is desperately looking like he is deep in conversation with Tim Groser at the moment so that he does not have to listen to what I am talking about. We know that is not real—we know that is not real.

💬 Hon Lianne Dalziel: He’s “en-Groser-ed” in that conversation.

He is “en-Groser-ed” in conversation. But the reality is that this is important, and it is a shame that this is being rushed through the House under urgency, with no chance to actually discuss the amendments that are being made.

The Minister talked about this new permitting regime that he is introducing. It is a conditional permit, which will allow prospectors who are not going to carry out drilling to be held to only the health and safety environmental and financial standards that apply to the activities that they are actually carrying out. Well, on the surface of it, that seems perfectly reasonable. The problem is that we are not sure that that is actually what the drafting is going to achieve, and that is the value of a select committee process. This is an area where we are at risk of opening up enormous loopholes if we do not get it right. I am afraid that what is at stake is far too precious to take that risk. There is no reason why this could not have gone to a select committee just to have a look, even for a truncated period, given that that part is the bit that we are really looking at, so that we can get advice as Opposition members on what this clause actually does and when it will actually achieve the stated aims and outcomes that the Minister has indicated.

The wording actually says that “An applicant for a Tier 1 permit for exploration who does not have the expertise or financial ability to undertake exploration drilling activities will be able to be granted a permit on a conditional basis. If the permit is granted, the permit holder will be required to undertake the committed work … and must then,—based on the results of that work, negotiate to sell all or part of its permit …”—and this is the bit that I am concerned about—“or build its own capability to do the contingent work so that it can commit to do that further work itself.”

My question would be that if we are passing this because we are acknowledging that these companies that are going to be carrying out the seismic surveying—because that is largely what we are talking about—do not have the capability up front to carry out exploratory drilling, so, therefore, are not going to be held to that higher standard, then why would we expect that they are going to be able to go on and carry out that work after they have done the seismic surveying? Carrying out seismic surveying does not give you any experience in carrying out exploratory drilling, so why is that part of the clause even necessary? Why do you not just end it at saying that they have to onsell the permit, relinquish it to Government, and that is it? That is what I understood the amendment was trying to achieve, and what the Minister has said it is trying to achieve, but that is not what the legislation says. The legislation says that a company that the Government deemed unable to meet the standards required to carry out exploratory drilling could in fact go on to carry out that drilling. I wonder why that is there.

This is the kind of question that a select committee would ask of officials, and there may be a response to that. I look forward to Jonathan Young’s speech. Maybe he can provide an answer to that question. But if the expectation is that only companies that meet those environmental health and safety and financial standards can carry out this work, then why are we leaving open a loophole for them to carry out this work in the legislation? To me that is a real danger, and in this area, where there are literally millions of lawyers all around the world being paid literally billions of dollars to find these loopholes, I want to know that our law is as tight as possible and meets those high standards. I simply do not have that confidence based on what the Minister said, which does not match up with what the law says.

But I want to come back to the area that I am really concerned about in this legislation, and that is the extension of the incredibly Draconian and anti-democratic bans on protests beyond our exclusive economic zone and out into the continental shelf. The Minister has tried to say: “Oh, that’s what I meant to do in the first place and it’s not really a big deal.” Well, the Minister might think it is not a big deal, but what we are talking about is 1.7 million square kilometres of area in the ocean. That is a big deal. When the original amendment Act was passed, “offshore area” was defined as “any area within the territorial sea or exclusive economic zone that is on or above the continental shelf”. That quite clearly means that it is our territorial waters and it is the exclusive economic zone. That is it. That was what we understood when it went through the select committee process, that is what we passed in this House just weeks ago, and tonight we had the Minister amending that to say: “ ‘offshore area’ means any area that is—(a) within the territorial sea; or (b) within the exclusive economic zone; or (c) on or above the continental shelf”.

So we have now just included 1.7 million square kilometres of deep-sea area that was not included in the original legislation. I would seriously question whether or not we actually as a Parliament have the right to pass this legislation. What we know is that we do not have the right to fisheries in the continental shelf and we do not have the right to regulate other activities above the continental shelf, such as shipping. So if we do not have those rights to regulate those activities, what makes the Government believe we have the right to regulate protesting? I want to hear the answer from Jonathan Young to that question, because I know that the Ministry of Foreign Affairs website makes it quite clear that we do not have the right to regulate activities in those areas.

This brings me back to another very important area, which is that, once again, we did not have a New Zealand Bill of Rights Act vetting, or a legal opinion, in relation to our international obligations on the original Supplementary Order Paper that introduced the protesting ban in the exclusive economic zone. We had the Attorney-General coming down to the House and giving a speech, trying to insinuate that he had a legal opinion on its consistency with the New Zealand Bill of Rights Act. When he was actually pushed and asked to table it, it turned out he did not have a legal opinion on the New Zealand Bill of Rights Act, which is highly unusual for something so controversial.

💬 Hon Maryan Street: Just his own opinion.

Just his own opinion, which he might think is a legal opinion. It is not the one we wanted. We wanted one that was actually applicable to the New Zealand Bill of Rights Act, and there was no legal opinion. Once again on this piece of legislation, there is no legal opinion on its consistency with New Zealand the Bill of Rights Act and no legal opinion on its consistency with our international obligations.

Equally disturbing, there is no regulatory impact statement on this piece of legislation. So the two regulatory impact statements we have are from the previous piece of legislation that we passed just weeks ago, which do not refer to the new matters raised in this bill at all.

I am a very helpful member of the House. I do not agree with this legislation—we will be voting against it—but I like to be as helpful as I can possibly be and aid the Government, so I have drafted my own regulatory impact statement on this piece of legislation in order to advise and inform and help members, because I want to be constructive, and this is it. I have drafted it myself, and it is very much in line with the other blanked out regulatory impact statements we have seen tonight in the House. I have copies for members if they think it would help inform their speeches, just as the other regulatory impact statements have! It is very informative and it took me quite a long time—quite a long time! A lot of Vivid pen was used in the making of this regulatory impact statement, but it really meets the quality of the other regulatory impact statements we have seen in the House tonight, and I think it will go a long way to inform the debate! I am trying to be constructive, Minister. I am interested in finding multi-party solutions to these multifaceted problems, and I am here to help—I am here to help. That is all I can say.

This is a dreadful attempt by the Government to fix up a mess of a bill—

💬 Hon Lianne Dalziel: What does it say?

It says “and”—it says “and”. So make of that what you will. It says “and” and that is a legal opinion, and the rest of it is redacted—redacted for Government purposes. So we will be opposing this bill. It is a shameful attempt to extend a Draconian, anti-democratic law. Thank you. I seek leave to table the regulatory impact statement that I drafted—

No, I am not prepared to put that leave.

I guess it is a pity that the only word that the previous speaker, Moana Mackey, could put on a piece of paper was the word “and”, because I think that, you know, in terms of the select committee process, yes, she did participate, she did contribute, and she brought her point of view across. I think what we need to understand around the adjustments that we are now proposing here with this Crown Minerals Amendment Act 2013 Amendment Bill is how the oil industry operates, because there are very, very few operators around the world who would be able to supply every step, every facet of technology and implementation of their programme, within the scope of their own company.

If you go to Taranaki and you see a great New Zealand company like Todd Energy up there working away, if you go on-site and look at what they are doing there in north Taranaki, you will see on their site probably half a dozen companies. You will see Schlumberger. You will see other companies that do the cementing—Halliburton. You will see drill companies. You will see all of these different companies operating. What we are saying is that instead of having just a single health and safety plan for a permit, every single step of the process in this incredibly important and risky enterprise should have a health a safety plan that is submitted and ticked off, so that we see that every step along the chain in terms of exploration and production is going to be done in a very safe way for the sake of not only the workers but also the environment in which it happens. So this is very sensible stuff.

We know that in Taranaki oil exploration has been happening since 1865, with the Alpha well on Ngāmotu beach—probably before Texas, Taranaki was hard at work in this industry. We are a great industry up there and we serve the country very well. We want to see this industry expanded throughout the country. We know what it has done for Taranaki, and for the people there and for employment there, and we believe that this is going to be something that, if done wisely, done well, and done in a very proactive and a positive way, is going to be a great benefit to all New Zealand. Thank you.

I rise to speak to the Crown Minerals Amendment Act 2013 Amendment Bill. As my colleague Moana Mackey said, this legislation that we passed just a matter of weeks ago has now had to be resubmitted by the Minister of Energy and Resources because it was rushed through in a way that left it completely riddled with loopholes that the Minister had not spotted and had not been rigorous enough in his oversight of this bill to discern.

But I have a particular question relating to this issue, and it is whether this bill being so rushed—the members opposite wish it to pass through all its three stages under urgency—may mean, and it is a bit of a conundrum, that it might come into force prior to the legislation that it is designed to amend. The legislation that it is designed to amend takes effect, as I understand it and as I recall it, on 24 May. Today, in parliamentary terms, although not in real-world terms, it is 16 May, under urgency. What happens if the Royal assent is given to this amending legislation prior to the other legislation having been signed off—well, having reached its implementation date?

I do not even know whether the Minister has thought that far because, looking at the size of this amendment bill to the amendment Act, one can only assume that he hardly reads past page 1, because he believes then that the officials are right and everything he does is backed up by officials, and he can blame them later. Well, I am sorry, Minister. I know this Minister is a new Minister, and I understand that it takes a little while to get the hang of the job—it is a very big job—but in the end the policy and the legislation are the Minister’s responsibility. We have not yet had the primary legislation arrive at its implementation date and we are ramming through a bill to amend that legislation. Lesson No. 1 for new Ministers is that this is not good enough—this is not good enough.

The Minister has then compounded the errors by not producing a regulatory impact statement on the amendment bill. In fact, what we have tabled are the regulatory impact statements on the original bill, on the first amendment bill, which was passed a few weeks ago. So instead of taking a leaf out of Tony Ryall’s approach to ministerial responsibility and blacking out large portions of regulatory impact statements, the Minister has become so scared of making a mistake now that he has refused to give Parliament a regulatory impact statement. So it is even worse than having a completely redacted regulatory impact statement. We do not have one at all.

So now we are getting past the boundaries of the Minister’s competence. We can see that this is a chapter of errors, from which I can only hope the Minister will learn if he wishes to remain in such a job at any time in the future, because this clearly is not good enough. We will, on 16 May, pass, because of the attrition of time, an amendment bill to an amendment Act that has not even come into effect yet.

There are a couple of other things I want to talk about, and one is the impacts on health and safety, as well as environmental rules. The previous speaker, Jonathan Young, knows a little bit about this because it is happening just offshore from his electorate and onshore at the north end of his electorate, and he assured us about how they have health and safety rules and regulations and they have to have them signed off. I have been on those sites. Yes, they do have health and safety programmes. But this legislation says that under the conditional permits, which are the ones that this amendment bill is seeking to add to the amendment bill that we passed a few weeks ago, applicants no longer have to show that they have the ability to comply with health and safety or capability or environment tests associated with exploratory drilling if, at the time, they do not intend to carry it out. So they are required to meet the standards of health and safety and environment tests only if they are committed to carrying out those activities at the start of what they are doing. At the point of needing to conduct exploratory drilling they can either sell it to another company or try meeting the tests themselves, but the risks open up a huge loophole in the health and safety provisions, and in the environmental tests, if not given proper scrutiny.

The theme of today, under urgency, is not giving things proper scrutiny. If this bill went to a select committee, came into effect after the primary legislation had come into effect, but was properly scrutinised through a select committee process, we might end up with sensible amendments and better amendments to the primary legislation than the Minister has come up with.

At the moment, quite frankly, in looking at this bill as it stands, I do not know how these people who would apply for conditional permits would recruit to their companies and organisations. I do not know how the human resources manager would advertise positions—perhaps with a name like “a job to die for”. Perhaps that would be the tagline for the human resources manager. These protections that we require in other legislation are being waived in the case of these conditional permits, and that is not good enough.

The other thing that is of major concern to me is the extension of the ban on protesting. Not only does this Government wish to control all levers of power within New Zealand; it wishes to reach out beyond our jurisdiction and exercise power outside territories that are ours and in fact subject people to a stripping of human rights to lawfully protest way beyond the exclusive economic zone and to the continental shelf, where in fact international law would apply. This extension of something that already strips away the rights of legitimate protest now seeks to extend that beyond the bounds of this Government’s legitimate jurisdiction. Thank you.

Kia ora, Mr Speaker. Ngā mihi nui ki a koutou. Kia ora. The National Party members are obviously asleep in Parliament tonight and are not taking their calls on this very important bill, the Crown Minerals Amendment Act 2013 Amendment Bill. This is an embarrassment—an embarrassment to the country—because what we are seeing is an amendment Act amendment bill being introduced to Parliament, under urgency, without—[Interruption] Mr Young, you want to go back to the people of Taranaki and say that you are doing your best to have a good, strong regulation of the oil industry, but you are quite comfortable with passing these amendment Act amendment bills to fix up the messes that the current Minister of Energy and Resources has made. You are comfortable with not having any regulatory impact statement, any select committee process, any real explanatory statement, or any New Zealand Bill of Rights Act vetting. Are you comfortable with that? Are you comfortable with such a laissez-faire approach to oil regulation in this country, when we are talking about our “100% Pure New Zealand” environment, our agriculture industries, our tourism industries, and our fisheries industries?

When we are talking about the future of our economy, we should be standing up and protecting it, and having the best regulations. But instead what we see are cowboy tactics from this Government. We heard the Prime Minister say: “We won’t allow cowboys in this industry.”, but what we are seeing is cowboy behaviour from the Government benches. It is an embarrassment.

I want to touch on four points. I want to talk on the Minister’s role in this fiasco in the House. I want to talk about the shoddy process we are seeing. I want to talk about the cowboys we are encouraging with this amendment Act amendment bill. Lastly, I want to talk about what we should really call this bill, which is the “China National Offshore Oil Corporation Law Bill”, because this is what I believe this is really about. This is not a minor, technical bill. This bill is making a significant number of changes to a very important piece of our legislation protecting our economy, protecting our environment, and protecting our workers’ health and safety.

I do not want to play personal politics, because I do not believe that is the right way to go, and I am not going to pit it against the Minister. But what I am going to say is that I think we are seeing an inexperienced Minister who is in over his head trying to fix the mistakes. It is an embarrassment for this Government that an amendment Act that still has not even come into effect needs to be amended under urgency in such fundamental and numerous ways.

We are seeing a Minister who is in over his head. The legislation originally was full of holes, but the Minister was quite happy—once again, I guess, like Jonathan Young was quite happy—to not have a select committee process, and to not have a New Zealand Bill of Rights Act vet for the fundamental Anadarko amendment, which a former Prime Minister and a prominent Queen’s Counsel said was a fundamental breach of human rights and could quite possibly breach international law. But National was quite happy to run ahead in cowboy fashion, and here we are, seeing the consequences.

I agree with Moana Mackey. How long will it be until we are back in this Chamber, fixing the holes in this rushed amendment Act amendment bill. It still sounds ridiculous, just saying it out loud—“amendment Act amendment bill”. The process is shocking. We are seeing Budget urgency being abused, I believe. We do not see any regulatory impact statement. I know it is not a Standing Order of our Parliament, but there is a convention that an explanatory statement will actually refer to what is in the legislation, particularly in important pieces of legislation.

What we know is that clause 14 of this new amendment Act amendment bill is extending the jurisdiction of this country an extra 1.7 million square kilometres over the continental shelf. This is the subject matter of huge international tension at the moment, as we see with China, North Korea, and South Korea. We see China debating these issues over the Spratly Islands. We see the Arctic nations of Canada, Russia, and the United States arguing about these issues. Who controls the continental shelf? National, though, unilaterally has decided, under Budget urgency, to go and decide what the jurisdictional issues are over the continental shelf.

I wish the Minister of Foreign Affairs would share his opinion on this legislation, because what we are doing is an unprecedented step, a unilateral step, on something that has vexed international scholars, international legal experts, and Governments for more than four decades. National has gone ahead and made the decision, under urgency. Again, what I think we are seeing is a Minister in over his head. We see no New Zealand Bill of Rights Act vet. The process is shocking.

There are going to be a number of calls, because we are looking at this legislation under all stages. I do want to very briefly touch on—I know there will be a lot more time to discuss it in detail—the substantial amendment in this amendment Act amendment bill, which is that the Government is easing up, liberalising, and taking a laissez-faire approach to who gets an oil permit in New Zealand.

I understand that 2 weeks ago the Government opened up 189,000 square kilometres of New Zealand’s water to deep-sea drilling. It said that we have got the best standards in the world, world-class regulations, and that we would have only the best for New Zealand, but what the Government is doing is relaxing and weakening the standards for those who get a permit. The Prime Minister said that we are not going to allow cowboys to get permits, but what the Government is doing is allowing companies without the financial backing, or without the expertise to do things they are applying for permits to do, to get permits. This is incredibly worrying, because what we are going to see is a posse of cowboys enter New Zealand to speculate in the oil market.

The background to this bill, of course, is that the Government’s oil strategy, the Minister’s oil strategy, has been such a woeful failure in its own terms. We have seen Petrobras go, we have seen Apache Corporation go, and we have seen Anadarko delay its activities. The strategy has been such a failure to attract the big players down to New Zealand that now, just to keep up appearances, the Government is trying to bring in all the small speculators around the world, trying to get them to come down to New Zealand and speculate. It is incredibly worrying, because we do not want cowboy activity in our oil sector.

Lastly, why is clause 14 amending section 55 by amending the definition of “offshore area”? It is important, because all the Government is adding in clause 14—and it was not until about 10 p.m. last night that I actually saw why the word “or” was so important. What the original Anadarko amendment said was that the provisions, the five new offences to criminalise protest activity at sea, apply only in the territorial sea and the exclusive economic zone. By adding the word “or” to extend jurisdiction over the continental shelf, what this Government is doing is expanding its powers over another 1.7 million square kilometres. Why this is significant is that last week the China National Offshore Oil Corporation and Shell announced they would be applying for a permit—where? Over the continental shelf in between New Zealand and New Caledonia.

I would not be surprised if Official Information Act requests show that the Minister probably received a phone call from one of these players saying: “Hey, did you realise your amendment Act did not cover our activities, because we are worried about protesters. We are worried about New Zealanders standing up to our interests. We are worried about Kiwis who are looking out for the environment and economy. Do something about it.” So, of course, Minister Bridges said: “Well, how high would you like me to jump?”.

What we see is an embarrassing process and a shoddy process. We are encouraging cowboys. We are seeing benefits again to the big mates of the National Party. It is a bad day for Parliament. I do not think anyone is proud to see this legislation in front of the House, but I am sure there will be a lot more to say about it. Kia ora.

It is a pleasure to take a call on this, the Crown Minerals Amendment Act 2013 Amendment Bill. This bill is really about New Zealand’s future. It is about building on the platform that this Government has created in order to provide jobs, opportunities, and economic growth for our nation going forward.

Due to some minor omissions in the transitional provisions of the Crown Minerals Amendment Act, which we passed last month, we have had to bring this bill into the House in order to correct some of those omissions. We are doing this because it is prudent. We are doing this because it is responsible. We are doing this because it is the right thing to do. It is the right thing to do because this Government is continuing to work on all fronts to ensure that these industries—the oil and gas industry and the minerals industry—are able to thrive and prosper in this country.

Although members opposite will cry foul about what is going on in Australia and how its Crown minerals are being utilised to their fullest extent, they continue to vote against bills that create jobs and opportunities for all New Zealanders. They continue to vote against jobs that are created by the construction of a convention centre. They continue to vote against jobs provided in manufacturing. They continue to vote against jobs where the provision of infrastructure and broadband investment continue under this Government. They are against it all. It is quite sad.

But what this bill also creates is certainty for operators who obtained mining licences under earlier regimes and who are covered by these transitional arrangements. It provides certainty. Certainly when you go out and talk to manufacturers and producers out in the market—I know the Labour Party do not worry about talking to those who create jobs and growth. But when I go out there and I visit my manufacturers in Maungakiekie, what do they say to me? What do they say? They say they want lower taxes. They want less compliance and red tape. They want the Government to support business in order to support jobs and growth, and they support this Government’s Business Growth Agenda.

Although members opposite continue to rail against economic growth and rail against providing for our families, it is about families. It is about giving them the opportunities to look after themselves.

💬 Hon Lianne Dalziel: What’s that got to do with this bill?

That is what this bill does—it supports that economic growth agenda. Miss Dalziel does not know what the economic growth agenda is, even though she was the Minister of Commerce for so long under that shabby Labour Government between 1999 and 2008. Although Labour prefers to legislate over tax and increase red tape and compliance, this Government with this bill and other bills like it continues to promote jobs in this country. That is why I commend this bill to the House.

I take a call on behalf of New Zealand First on 16 May here in this Chamber, but outside it is 17 May, my son’s 28th birthday. Happy birthday, Sam. It is somewhat surreal to be here and, although we are in the same country, to think we are on a different date line and different time zone while others are enjoying a very nice birthday in Auckland. But, having said that, we also have another young man—who is a bit older than my son, who is 28—who is now the energy Minister, Simon Bridges. We are going to give Simon the benefit of the doubt because Simon came in as the new Minister of Energy and Resources in January, and I think he has actually been doing a pretty good job. I have had a bit to do with Simon. I have brought things to Simon’s attention, and he has responded. I have appreciated the fact that he has.

In this instance, everyone wants to try and pin it all on Simon that this amendment bill, the Crown Minerals Amendment Act 2013 Amendment Bill, is being required, but, at the end of the day, as we all know, legislation is drafted by legal minds and advisers within the Parliament. It is not always that every single loophole is picked up. It is not always that every contingency is included. In this respect, this was a pretty big bit of legislation in terms of the Crown Minerals Act in the first place. It does not surprise us in New Zealand First that there probably were a few things overlooked. We are actually very pleased that some of these small loopholes in it are being corrected so soon and now, so that it does not just drag on and on. There is nothing worse than having bad legislation on the books and finding that it does not work and it does not help.

We are particularly drawn to the regulatory impact statement. As New Zealanders well know, New Zealand First is very supportive of good policy that will see more employment, more jobs, more economic opportunity for this country, and more regional development, in particular. In this regard, in the regulatory impact statement says that there will be an increase in permitted activity, and this could in turn lead to increased economic activity, exports, royalties to the Crown, employment, and regional development. So, obviously, if you have an increase in permitted activity, it does stimulate greater economic activity as a result. We are very supportive of that. New Zealand First wants to see New Zealand improve its performance overall, and we do want to see good, sustainable, responsible use of the resources that our country has.

We do have to recall the fact that New Zealand has the fifth-largest exclusive economic zone in the world. It is vast; it is huge. I sat on the Local Government and Environment Committee, and I was most impressed with the information that came to that committee about just the potential that is out there in our economic zone, and what it would mean to a small country of 4.5 million people if we properly explored it and if we properly took care of it, bearing in mind that we have to be very mindful that we are the guardians of a very important part of the South Pacific. It has to be done in a proper manner, a safe manner, and a responsible manner, but there still is huge opportunity out there, which this country must be looking at. So in that respect, this is good legislation to sort this out, get it right, and get it improved so that that can occur.

In reading the explanatory note of the legislation, it says: “An applicant for a Tier 1 permit for exploration who does not have the expertise or financial ability to undertake exploration drilling activities will be able to be granted a permit on a conditional basis.”, and it goes on to give the reasons applying to that. There will be instances of some companies wanting to come and invest and look at opportunities, put their money on the line, and look at ways to contribute to our economy that may need to gear up, improve their capacity, and improve their knowledge in the area, and that will be bringing on other partners and other joint venture operators with them to do this. So this is a building programme, and you cannot necessarily have the full level of expertise and capacity from day one. Again, this legislation provides for that. We do not see that as necessarily being negative, but what it does mean is that there will be opportunities for investment in this country by those that otherwise might not have considered it in the first place.

So we will be supporting this, but what New Zealand First would like to remind New Zealanders of is the fact that, out of all the minerals and out of the taking of resources from our country, often the very places where those minerals and those resources are taken from do not necessarily get the full benefit of that extraction. Taranaki has done very well. Taranaki has been the jewel in the crown of the resources industry in this country, but often that is not the way. Around the world it is often the way that the people living where the resources are taken from do not necessarily benefit. Companies benefit, corporates benefit, the Government can benefit, but not necessarily the people.

So New Zealand First has a month or so ago put out a policy, our regional royalties policy. It is very clear what we say in New Zealand First: we would return 25 percent of all Crown royalties taken from any resources or minerals or extractions back to the region that they are removed from. We believe that is a very sound and sensible policy, and it would put money back into those areas to pay for necessary infrastructure to support roading, to support infrastructure, to support the necessary capacity in those regions, to help support those very same mining, minerals, or extraction industries that are going on. We believe that would be a very, very sensible thing, which we would like at some stage in the future to get through legislation to provide for. At the same time we believe that those minerals and the extractions should be paying higher Crown royalties as well. We believe the Crown royalties that are taken at the moment are too low. We think there should be a review of this, and we think New Zealand should undertake a full comparison with other countries and ensure that we really are getting a fair—what do they say—suck of the sav, as they say in Australia. We should be getting our fair whack from what is being taken.

So we are going to support this legislation, and we hope that this will now sort out the Crown Minerals Amendment Act, that we can take this on, and that New Zealand can continue to grow and prosper as a result of future opportunities with Crown minerals.

It is my great pleasure to stand in support of this Crown Minerals Amendment Act 2013 Amendment Bill. It is good to follow Andrew Williams from New Zealand First, which has supported this bill. Sometimes I feel that New Zealand First has got some common sense, and it supports this bill under consideration.

I would like to clarify something for the member from the Green Party, Gareth Hughes, who just mentioned that a lot of overseas companies are withdrawing from New Zealand. I had an opportunity to meet one of the investors from Canada recently who are investing millions of dollars in oil exploration in New Zealand. He was very excited by the opportunities available over here, and investors are ready to support the exploration of the mineral opportunities available over here and come and invest over here.

While I am talking about petroleum, petroleum is the fourth-largest export earner for New Zealand. It earns about $1.8 billion in revenue and employs about 7,000 New Zealanders. This bill ensures commercial certainty for the operators who have been granted permits and this amendment bill fixes some of the loopholes that were left in the Act earlier. So I hope these opportunities will bring more investment into New Zealand and create more jobs, which will help the economic growth in New Zealand. I commend this bill to the House.

The title of the Crown Minerals Amendment Act 2013 Amendment Bill speaks for itself. This is a tidy-up bill, because the last bill—now the Crown Minerals Amendment Act—was such a mess because it did not have the requisite attention paid to it. We are now passing an amending, tidying-up, improving piece of legislation that will have very little scrutiny at all—certainly not the sort of scrutiny that ought to apply in a bill dealing with an issue that is so important.

The primary purpose of this bill is to split the approval process over the different stages of oil and gas exploration—and that is approval for the health and safety as well as the environmental aspects or measures to be taken—first of all for prospecting, the second stage for exploration, and then subsequently for production. It is about splitting up that process so we have the separate process after the first one for the prospecting part of it.

It deals with the regime that is set up in the new Crown Minerals Amendment Act, but the reality is that that regime is already pretty light. If you have a look at new section 29A in the Crown Minerals Amendment Act and look at what is required for the Minister to approve a permit in terms of health and safety, in subsection (2)(b) of new section 29A it says the Minister must be satisfied “that the applicant is likely to comply with,”—not “is required to”, not “will”, but “is likely to comply with,”—“and give proper effect to, the … work programme, taking into account—(i) the applicant’s technical capability;”. It is not as the Health and Safety in Employment Act would have it, which is the industry knowledge available at the time, but the very subjective test of “(i) the applicant’s technical capability; and (ii) the applicant’s financial capability;”—so if it is a small company, it gets let off the hook—and then “(iii) any relevant information …”. A later paragraph says that the Minister “is only required to undertake a high-level preliminary assessment;”. That is actually a pretty light approach to health and safety and environmental safeguards when it comes to this important economic activity. This bill now seeks to split that up, and effectively to make it even lighter.

There is another aspect to it too, which is that the whole workplace health and safety regime in this country is undergoing change—radical change, long-overdue change, but change that has been prompted, first of all, by the Pike River disaster, and, secondly, by the review that this Government under the previous Minister of Labour very sensibly initiated, of which we have now seen the report. Both the Royal Commission on the Pike River Coal Mine Tragedy and the Government’s own health and safety advisory group have recommended radical change in health and safety. So that is all in play at the moment. Now we have this bill, which is seeking to weaken an already very light regime for this industry at the permit-setting process.

One thing was very clear that came out of the royal commission on Pike River, and that was that health and safety was an issue that had to be considered at the very beginning of mining prospecting and development, not as an afterthought once production got under way. I fear that the provision in this bill that softens an already pretty weak provision in the bill that we amended just months ago is going to make that worse. In that respect, this bill may be seen as being somewhat premature in relation to the other health and safety changes that this Government and this Minister, in fact, with his Minister of Labour hat on, are already meant to be managing through.

But there is another issue that I think is even more compelling—another reason that is even more compelling—to justify why we are opposed to this bill. It comes out of something that the honourable Jonathan Young said. Jonathan Young referred to some of the companies that are active, certainly in Taranaki: Schlumberger—and, with all due respect, Mr Young did not quite get the pronunciation right—Shell, and Halliburton, with that well-known international reputation for good faith and ethical conduct.

These are giant multinational corporations. Halliburton has a balance sheet that probably surpasses New Zealand’s. We are saying to these companies: “Come here. You can do your prospecting. We will give you a permit for that. But once you have done your prospecting, don’t expect to get your exploration permit. You have to come for a second process for that.” But the reality is that we know what this Government is like when large multinational corporates turn up at its door and want a special deal. It goes weak at the knees, it quivers, and it gives up, rolls over, and has its belly tickled, and before you know it the New Zealand taxpayer is shelling out hundreds of millions of dollars to prop up the multinational. That is the way the Government conducts itself. That is the legacy of this tawdry, grubby little National Government that we have at the moment.

I can imagine Halliburton turning up—probably Dick Cheney himself, an emeritus director of Halliburton, will turn up, have a cup of tea with John Key, and say: “Oh, you gave us the permit for this bit. Give us the permit for the next bit.” Somehow Simon Bridges, the neophyte Minister of Energy and Resources and Minister of Labour, is meant to stand up to Dick Cheney and Halliburton, or Schlumberger, or Shell, and say: “Oh no, we are tough here. We are tough with our regulatory regime, and we are going to say no. You can start all over again and prove that you have got in place the health and safety and the environmental safeguards that we demand.”

The problem with that is it just is not credible. It is not credible, given the track record of this Government. When Warner Bros came here wanting a law change sponsored by Sir Peter Jackson, what did this Government do? It laid on the limos. It put on the hospitality, took Warner Bros representatives up to Premier House, wined and dined them, and gave up everything. What did the Government do when Skycity Casino took the Prime Minister out to dinner? That was it—deal done, convention centre built, a 35-year licence, and an attempt to buy Parliament and its sovereign rights. That is how disgracefully low our ethical standards are now.

And now this party in Government comes to this Parliament, all in a heated rush as part of the Budget process, and says: “Listen, we got the last set of amendments so wrong we have to get the changes in now, and, by the way, we want to make this change, which gives these multinationals the opportunity to stand over us and to leverage the partial permission we have already given them in this very crucial and sensitive industry.” That is what this Government is asking us to do. That is what this Minister wants us to do. It is tragic, it is wrong, and it is the reason we are opposed to the bill.

The oil and gas industry is a very important industry to this country and, indeed, to the world, and what we do, the way we manage it, is given close scrutiny from all around the world, from the operators and from others too. It is an industry where the industry players now expect high standards of regulatory conduct. They expect it and are not fazed by it. But they will see an opportunity if they see weakness in a regulatory authority, and if they see a Government demonstrating weakness, they will be all over it. There is nothing to lose in having a Government that is prepared to set the highest standards of health and safety and the highest standards for environmental safeguards in this industry, but this Government is going in the opposite direction. It is a great disappointment, it is wrong, it should not be happening, and that is why we will be opposing this bill.

Thank you for the opportunity to speak on the first reading of the Crown Minerals Amendment Act 2013 Amendment Bill, in the name of the Minister of Energy and Resources, Simon Bridges. As my other colleagues have already stated, the purpose of this bill is to encourage the safe and sensible development of Crown-owned minerals so that they contribute more to New Zealand’s economic growth and standard of living. This will be achieved by streamlining and simplifying the Crown minerals regulatory regime and ensuring better coordination of regulatory agencies. This bill also makes minor changes that do not dilute the robust performance management provisions of the regime in any way, but are necessary to improve the alignment of the regime with current industry structures and future resource development.

The bill ensures that the changes to the regime can be implemented to their fullest extent in a consistent manner across the industry. The Government’s Business Growth Agenda supports New Zealand business to grow, in order to create jobs and improve New Zealand’s standard of living. Natural resource industries are an essential part of this. They are major export earners, they contribute significant royalty and tax revenue, and they create higher-paid jobs. However, there is huge untapped potential. Many, many New Zealanders are simply frustrated that we are doing nothing to tap the huge potential of our natural resource industries. This bill is good news for them. I support the bill. Thank you.

This is a split call. I call the Hon Ruth Dyson.

Correct. Can I say that of all the excuses that I have heard this evening, the ones I have just heard from the member Jian Yang, who has just resumed his seat, were the best. They were the most innovative and the least related to the research unit notes of the National Party, and I want to commend the member for that.

We have heard some extraordinary stories about why this bill, the Crown Minerals Amendment Act 2013 Amendment Bill, is here. Jonathan Young stood up and said with an absolutely dead-straight face: “We now know more about the industry.” This bill is amending a bill that has not even come into force yet, Mr Young. We have not learnt a huge amount more about the industry in the last 3 weeks. Well, perhaps the member might have, but the rest of the world has not—certainly not enough to bring in an amendment to the legislation. Another one of the National Party said that this bill is to correct minor omissions in the transitional provisions, and that it was prudent, responsible, and the right thing to do. This is just amazing. That was clearly in the research unit notes. And somebody else said that it was a tidy-up. Well, it certainly is a tidy-up, and the reason that it is a tidy-up is that the Minister of Energy and Resources, Simon Bridges, made a mess of the last attempt at a bill.

It is quite clear that even though Jonathan Young has learnt a huge amount about the oil industry over the last 3 weeks, the Minister has not. If he had learnt anything about parliamentary process, he would know that ramming a bill through all stages with no scrutiny by a select committee and with no submissions from the public is begging for problems. I predict that we will have the “Crown Minerals Amendment Act 2013 Amendment Act (Later On in 2013) Amendment Bill 2013” coming before the House before the end of the year, because the Minister just cannot help it. He is in such a desperate hurry to get his name on the statute records that he just makes a muck-up of it. He is going to be known as the Minister who has made more mistakes in his tenure as a Minister than any other in history.

We should not have to do this. We should send the bill to a select committee, where people like Jonathan Young, who is actually a competent and good chair—he is a competent chair—could make sure that submitters came in and told us about the issues of concern, could alert us to potential fish-hooks, and could explain to us that there could be unintended consequences from legislation, and the committee could say: “Well, we’re prepared to take the risk.” or “No, we want to avoid that and we’ll change it.” But, no, Minister Simon Bridges knows it all and barrels the whole lot through under urgency without any scrutiny. That is just a recipe for disaster.

What this actually is, is a developer’s charter. It is clear that the changes that separate the consideration of the standards from the granting of the application are going to be a problem, so with health and safety standards, with environmental standards, and with the financial standards that the Government itself has set, it does not matter whether the application says no, it does not meet any of those standards; it can still be granted a licence to go ahead. That is a major mistake. Those standards are there for a reason. The Government put them in place, and I think it should make sure that they are adhered to.

The final point I want to make is in relation to something that clearly is not a tidy-up or correcting some omission or sudden change because we have learnt so much more about the industry, and that is the extension of the no-protest zone to cover the continental shelf. What arrogance of the Government. Whose space is the continental shelf? Is it ours to suddenly say that this new no-protest regime will be in place there as well? Well, that is what this legislation does. I know that tomorrow the country will wake to news of this, that this provision—which was justifiably lambasted when it first came before the Parliament just a little while ago—is now being extended. It is being extended by a significant amount; I think it is 1.7 million square kilometres. That is a huge area of continental shelf outside the exclusive economic zone where this new no-protest regime will come into place. It is ruining New Zealand’s international reputation, it is ruining our own democratic rights and protections, and I think this bill should be opposed.

I am not pleased to take a call on the Crown Minerals Amendment Act 2013 Amendment Bill, because I think it shows the contempt with which this Government treats the democratic process and this Parliament that it is introducing this bill and passing it through all of its stages under urgency with absolutely no opportunity for public submissions or scrutiny by a select committee.

The Minister of Energy and Resources talked about providing certainty for operators, and that is certainly a theme that you hear a lot from this Government—providing certainty for applicants and operators. It does that by weakening the regulatory regime, weakening our environmental laws, and making it much less certain for the environment. That is what we are seeing in this bill with these proposals for conditional permits, where the holders will not have to meet the same criteria and the same standards that the principal Act establishes. The Government sets up a regime in the Crown Minerals Amendment Act and then introduces legislation to apply a much weaker framework.

The Minister also said that the bill would fix a number of technical errors in the Act. It was given Royal assent only on 19 April. It has not come into force yet, and yet it is back before the House, needing to be fixed. If the Minister and the juggernaut of the Ministry of Business, Innovation and Employment cannot even get the legislation right and have to come back to Parliament within the month, then how can anyone have any confidence that this Government can effectively manage risky activities such as offshore oil drilling? The answer is that we cannot have any confidence that it will get it right either in the law or across our oceans.

Other speakers have pointed to this noxious little clause, clause 14, which extends the “no protest” law much farther out to sea—out 350 nautical miles from our coastline, much farther out than the very controversial Anadarko amendment did. That, of course, was another change to the law that was dropped into the House at the Committee stage with a Supplementary Order Paper, with no chance for public submissions and no chance to go to a select committee. In the same way today, the Government is curtailing people’s democratic right to protest, but without allowing the public to have a say on that. When Greenpeace put up its petition, it got tens of thousands of people objecting. But, no, the Government did not want to allow people to make submissions along those lines to the select committee, so it smuggled it through at the Committee stage, just as it is smuggling through this change under urgency.

The bill raises questions about whether there are potential breaches of international conventions like the United Nations Convention on the Law of the Sea, which enshrines freedom of navigation. When you have a look at the Ministry for the Environment website, it says that in areas where the continental shelf extends beyond 200 nautical miles from the baseline, the water itself above the continental shelf is not within New Zealand’s jurisdiction and is part of the high seas. So why does the Minister think he has the jurisdiction to extend New Zealand law to create criminal offences on the high seas? What does he think gives him the right to do that? That is one of the reasons the Green Party is opposing the bill.

Another one is because it facilitates inexperienced prospectors and pushes them, potentially, to start drilling, because if they get a tender and then they do not have the capacity to exercise it, the bill is requiring them to surrender it or onsell it. If you have put that investment into doing the exploration, why would you surrender the permit? It is tempting those permit holders to engage in very risky activities.

We have not got a regulatory impact statement, as other speakers have noted; we have got to depend on the one that went with the original Act. I would like to just quote from the explanatory note, which says: “An applicant for a Tier 1 permit for exploration who does not have the expertise or financial ability to undertake exploration drilling activities will be able to be granted a permit on a conditional basis.” So the Government, in the principal Act, set up some conditions, weak though they are, and then in this bill is allowing people to go round those conditions. It is a very weak regime that the Government is introducing in this bill.

I am very pleased to take a call on the Crown Minerals Amendment Act 2013 Amendment Bill. I just wanted to talk about the delivery of our Budget yesterday by our Minister of Finance, Bill English, and that fact that it highlighted something. It is that not only are we building momentum in our economy but actually we are on track to return to surplus in 2014-15. When I was campaigning in 2011, all I heard from the Opposition parties was that it was impossible to return our country to surplus in 2014 or 2015. Well, I tell you what, look at the results. Look at the results that were presented yesterday. We are on track to return to surplus in 2014-15.

We have also got in Simon Bridges a Minister of Energy and Resources who has also carried on that momentum, and who will continue that momentum in our oil and gas sector. It is an oil and gas sector that is critically important to the future economic growth of New Zealand. We heard Jonathan Young stand up and speak about his electorate of Taranaki. I was fortunate enough to visit Taranaki myself last year. The place is buzzing. The oil and gas sector there contributes the same amount to the GDP as the dairy industry does. So it is a very, very important part of our economy. I know for a fact that Northland, Rodney, and Whangarei, and Phil Heatley and Mike Sabin, will welcome and look forward to this sector growing. This bill is making a big contribution towards making sure that happens. Thank you.