Crown Minerals (Petroleum) Amendment Bill

Thank you, Madam Chair, for the opportunity to speak on the title and commencement aspect of the Crown Minerals (Petroleum) Amendment Bill. I’d like to focus on the commencement date, and, in particular, the fact that some urgency has been indicated by the Government in proposing a bill that will, in becoming an Act, come into force on the day after the date on which it receives the Royal assent.

The first observation to make about that is that, clearly, the Government feels some urgency about that. That makes sense as far as it goes, in terms of their position that this is a matter of some urgency, but I would ask the Minister Megan Woods to consider whether she might be willing to accept, perhaps, a Supplementary Order Paper, if that were to be lodged, to provide a different time frame for three particular reasons that I will now spell out.

The first is that the date is uncertain in the sense that we will not know until the bill receives Royal assent when it will come into force. Obviously, at the point that it does receive the Royal assent, there will be certainty, because it will simply be the day after that that the Act will come into force, but that will allow very little time indeed for those who are affected by it to be able to respond appropriately to its provisions.

For that reason, I am wondering if the Minister would be able to provide some guidance on whether she’d be amenable to a different type of commencement, such that the Act would come into force perhaps a certain number of days or weeks or, perhaps, months or even a year or years after the date on which it receives the Royal assent. That at least would provide more certainty in the sense that from the time that Royal assent was given, those who are affected most by it would have the maximum opportunity—or at least some opportunity—to arrange their affairs such that they will have the adverse effects mitigated somewhat. It seems to me that that would tie in with the Government’s stated goal more broadly of achieving “just transition”, such that those who, effectively, will be bearing the burden on behalf of all of New Zealand—and if we’re going to have a “Kumbaya” moment for the world, then at least we can have less unfairness in the sense that they will have a reasonable opportunity to move forward.

The reason this is particularly important in this bill is because of the significance of the time frame within the Act, as it will become, as mentioned in new clause 24. Now, I appreciate that’s in another part of the bill, but it’s particularly in relation to the commencement date—which I’m allowed to speak about at the moment—that that has significance. In particular, I refer to the fact that an application or a tender—an application being defined as an application or a tender—will be treated as having been withdrawn and relodged at the point that the Act comes into force. So, actually, it’s not just a matter of the timing of the bill being significant from the point of view that the various players involved need to know what’s happening generally so that they can react; it’s also that they might work proactively to act in a certain way—for example, in particular, by lodging an application in the hope that it will be viewed in one way and not the other.

The significance of that is—in particular, I’m thinking of a situation where a time frame might allow a judicial review of an application that is denied. For example, a party might apply and have such an application rejected by the Minister, or however that is considered—and I must confess I’m not on top of that detail, but I know that judicial review in general terms is available where a decision maker is said not to be reasonable. Now, if the time frame was such that that review were to be still ongoing when the Act came into force, then I think that the interests of justice would dictate very much that the applicant’s permit might actually be more appropriately considered to have been passed at that point, if the High Court—as it would be—would consider the application for judicial review, decide that the decision should be set aside, and then the Minister subsequently decides that it should be approved or determined in a positive manner.

So that is the significance of the timings as far as I’m concerned. I look forward to any comments that the Minister might have in terms of the commencement date and whether that could be pushed out, or have a specific calendar date maybe, so that there’s some certainty for all involved.

My apologies. I’ll make it clear we are debating clauses 1 to 3.

Clauses 1, 2, and 3—so I’m going to just touch on clause 2 at this point in time, which is the commencement. What I’m proposing, through Supplementary Order Paper 152, is that instead of just having a commencement date appointed by the Governor-General by Order in Council, we extend that to either 1 January 2021 or “Before the Governor-General appoints a date under subsection (1)(a), the Minister of Conservation and the Minister of Energy and Resources must—(a) release a discussion document on the ‘no new mines on conservation land’ policy” and also that they complete a series of consultations, as they have stated.

The reason why I say this is because in this bill there is a provision to restrict access on conservation land for only minimum impact activity, and this seems to pre-empt the consultation process that the Minister of Conservation and the Minister of Energy and Resources have committed themselves to—in the mining sector—take place. I think that it’s important that we ensure that that process and that timing is put in the right order, because the potential is that a company may apply for a permit in the onshore Taranaki region that actually also has some overlap in the conservation area—prior to the consultation that the Minister of Energy and Resources and the Minister of Conservation have undertaken with the broader sector. This bill is pre-empting that and, as such, I do not think that we can afford to have such pre-emption before there’s been a thorough consultation around access to conservation land.

We all know that the Speech from the Throne says no new mines on conservation land, and so this is the policy statement that the Minister of Energy and Resources—and she spoke to the Minerals Forum in Queenstown, at the annual conference, about this consultation. Suffice it to say, there is quite a high level of alarm and concern in the resources sector about the inclusion of this provision in this bill around restricting access to conservation land, so what I’m proposing for the Minister and others to consider is that we delay the commencement of this bill until that consultation has taken place—until the consultation that the Minister has committed to and that she has given in good faith, with assurances that she will listen to the minerals and the resources sector, takes place—and the consultation is with the mining sector and iwi in affected areas.

We already understand that this bill has breached Treaty obligations through Te Ātiawa’s settlement process, where they have had a commitment by the Crown to consult on such matters, and they raised that, of course, in the select committee process. So consultation with iwi, with local government groups, with environmental groups, with community groups, and with interested members of the public—this is so important.

So I would suggest and put forward that the rest of this Act come into force on the day after the date on which it receives the Royal assent, but that the Governor-General appoints a date under new subsection (1)(a) after the Minister of Conservation and the Minister of Energy and Resources have actually undertaken what they have said they will do. I think what this does is it puts into place the correct order of things.

I don’t think that the Minister in the chair, Megan Woods, wants to be accused of a lack of consultation with the minerals sector or the other sectors, so putting this provision in the bill creates that apprehension. The Minister may have an answer to that—I’d be keen to hear. But what I’m suggesting is that if this bill proceeds in the way it does, then it actually takes away an existing right, or an existing business-as-usual situation where a company who want to explore and who want to drill a hole in that exploration may want to produce and can no longer do that. At the present, there are 20 companies that do that, and it is taking away a provision.

I’m going to take a very quick call just to respond to Jonathan Young, the member who’s just taken his seat—Supplementary Order Paper (SOP) 152—to let him know that we won’t be supporting this SOP. I consider it largely unrelated to this bill. In fact, the provisions that are set out in this amendment aren’t in clauses 1 to 3, but I will respond to this because the bill is actually intended to avoid the conflict between various work streams. So that is the purpose of the provisions that are in the Act. The work programme related to the Government’s work around having no new mines as set out in the Speech from the Throne is separate, and there is no need to delay to coincide those work streams.

Oh, gosh—

💬 Lawrence Yule: Lawrence Yule.

CHAIRPERSON (Hon Anne Tolley): Lawrence Yule.

Madam Chair, it’s a pleasure—it’s nearly dinner time, and I understand that. Look, the question I wish to raise is actually around the title, because what this bill does is amend an Act, the Crown Minerals Act 1991, which is the principal Act, and then it inserts the word “(Petroleum)”. In my view, it’s too narrow a word. What we are talking about here is fundamental change to the energy that powers New Zealand. You can change oil and gas, and you can ban oil and gas, but there are implications for other forms of energy or for how we’re going to power New Zealand.

In my mind, we should simply say it’s an amendment to the Crown Minerals Act 1991 and take out the word “(Petroleum)”, because I think that it’s too narrow a definition for the scale of what this Government is intending to do. Even though we’re opposing it—I understand the numbers and I understand how they work—in my view, simply talking about “(Petroleum)” does not signify what this is. We are changing a fundamental Act—

CHAIRPERSON (Hon Anne Tolley): I’m sorry to interrupt such an eloquent member—Lawrence Yule—but the time has come for me to leave the Chair. We will resume at 7.30 p.m.

Sitting suspended from 6 p.m. to 7.30 p.m.

Colleagues, when we rose from the dinner break we were considering clauses 1 to 3 of the Crown Minerals (Petroleum) Amendment Bill. Lawrence Yule had the call and has three minutes and 49 seconds remaining, should he so wish.

Madam Chair, Mr Yule is unable to be here. I would like to speak on the title of this bill. The bill is called the Crown Minerals (Petroleum) Amendment Bill. We understand, of course, that hydrocarbons produce more than petrol. It may be confusing to many people but there are many products that come from petroleum.

I would prefer to call this bill the “Crown Minerals (Hydrocarbon Hijack) Amendment Bill”, because the Minister took everybody by surprise. She may have said that it was well signalled but I was at the petroleum conference when she said to them “We are the Government that listens, then acts. That consults widely, thinks through issues deeply and seeks to forge consensus on how we can take New Zealand forward together.” That statement probably reflects the principles of a just transition. But while they were waiting for the consultation to commence, they were informed on 12 April of the Prime Minister’s decision as she spoke to other coalition leaders. In fact, that this decision was made by three political leaders without a Cabinet paper going through Cabinet, and with, I would say, incredible repercussions through New Zealand—certainly in the short and medium term—then that is a hijack. A hijack is when something happens by surprise and suddenly you find yourself poorer. I think that New Zealand has been ambushed. I think we find ourselves poorer because of this.

You know, we all, I think, generally agree that we want to head into a low-emission economy and into a future—in fact, the Productivity Commission’s work was initiated by the Hon Steven Joyce. So that was a work that came out of the prior Government. But I think that when it comes to entering a low-emissions future—and every commentator would agree with this and say this is correct—it’s going to be costly to the economy. Look, it’s a very important goal for obvious reasons, but we’ve got to be able to get there. The Productivity Commission warned us that if the costs were too high it would deter New Zealanders from embracing that pathway. I think this bill, this hijacking, this ambush, this surprise, has dissuaded many, many New Zealanders who ordinarily might have thought “Yes, we need to progress systematically with good planning and, obviously, making incremental gains as we head towards that future.”

So I don’t call this a just transition; it’s really a shock transition. What I think this country needs is a smart transition, where we have thorough planning, thorough consultation, and we can put together the energy mix that we need in this country to remain economically secure, when we can put it together very carefully, rather than killing off one sector hoping that another one will grow in its place, because, essentially, this is what this bill is trying to achieve.

I think New Zealanders have been duped by the Government. A big smile and words of empathy, a sweet camouflage for what has been described as a “kick in the guts” by the mayor of New Plymouth, or a “symbolic beheading” by one of New Zealand’s leading energy reporters. New Zealanders are being tricked that this is good for us, that this is what we have to do to stop climate change. And yes, the Minister was challenged for research to back up that this is what it will achieve for New Zealand, and I don’t think it does. I do not think that this achieves this goal for New Zealand. I think New Zealanders are taken by surprise that such a powerful and disruptive piece of legislation designed to head us towards a low-emission economy actually makes no difference to our domestic emissions or our global emissions. I did wonder today, when the Minister accused me of saying “New Zealand was too small to make a difference.”, whether she had read the advice that came from her officials, because the officials said—

CHAIRPERSON (Hon Anne Tolley): Clauses 1 to 3—1 to 3.

Beg your pardon, Madam?

CHAIRPERSON (Hon Anne Tolley): 1 to 3.

Clauses 1 to 3. Right, so coming back to the title—thank you very much. “Hydrocarbon Hijack” or “I Don’t Read My Official Notes” could be another subtitle to this bill. I won’t go there.

So what we see here, I believe, is an effect on New Zealand’s economy. When I talk about hydrocarbon hijack, whenever there’s that type of approach to legislation, it bruises people, it injures people, it makes people worse off and poorer. It’s not just the oil and gas workers in my region; it’s where they now no longer spend their money. So it’s the chap down the road who might sell them a suit; it’s the people who work in the restaurants who might feed them and make them a meal. Those are the sorts of people who get affected by this.

I call this “Ultimate Nimbyism (Not in My Backyard”—[Time expired]

I raise a point of order, Madam Chairperson. I gave the member the courtesy of waiting to the end of his contribution before I raised this point of order; however, I am aware that contributions on the title clause must not provide suggestions that are clearly a critique of the contents of the bill. I would argue that that suggestion was exactly that. I would hate to see this debate go on unnecessarily and see the other side of the House suggest things that weren’t consistent with the Speakers’ Rulings.

Yes, but the Speakers’ Rulings also states that it’s the Chair who decides that.

I move, That the question be now put.

Thank you very much, Madam Chair. It’ll be a pleasure to speak in any way that you should feel appropriate in relation to the clause—

💬 Hon Stuart Nash: Just follow the rules.

I will follow the rules. I’ll follow the rules so tightly that you will be, no doubt, very impressed with the number of different title observations that I have to make including—well, let’s get the obvious out the way—the Crown Minerals Amendment Bill. It will amend the Crown Minerals Act 1991—so far so good. But what’s in the brackets there? The word “(Petroleum)”, I would suggest, could be actually usefully substituted to provide a clearer description—and not for any other purpose, Mr McAnulty—and I have a number of different suggestions along those lines.

The first could actually be the phrase “(Nuclear-free Moment)”. It could be the “Crown Minerals (Nuclear-free Moment) Amendment Bill”. That’s something of an olive branch that I would offer to the Government benches.

💬 Simeon Brown: An olive oil branch?

That’s something that they feel is appropriate to the nature of the bill. Ha, ha! An olive oil branch has been suggested. Well, I think that’s probably a gratuitous attempt to get the word oil into the bill. So I’ll ignore that comment from Mr Simeon Brown and not allow myself to be distracted and waste any of the House’s time on that.

But the significance of the “(Nuclear-free Moment)” suggestion that I made is that, actually—well, ironically—if nuclear energy were the substitution, that is not provided in this bill, then we would be, perhaps, not having the pyrrhic victory that we’re going to have in relation to carbon emissions, as has been previously outlined on this side of the House. To be clear, I’m not suggesting that necessarily—that would go to the content of the bill, and not the title—but I think “(Nuclear-free Moment)” would have that nice little double meaning, perhaps, according to which side of the debate one finds oneself.

Another suggestion would be something along the lines of “(Investment Implications)”—so the “Crown Minerals (Investment Implications) Amendment Bill”. There are significant implications for the emotional investment and the political investment that the Government has placed in this bill, and, of course, investment in the more literal and obvious sense in relation to extraction industries that have served us well as a country, both in terms of energy supply and, indeed, in economic terms is obvious too. So, again, I’m making a suggestion that I think might find favour on both sides of the House by offering something that could be viewed as a positive no matter which angle one approaches this bill from.

My next suggestion is the word “(Coal)”, and, just to be clear, I’m talking about the substance that’s used to burn energy. Charlie—

💬 Dan Bidois: Not talking about “coalition”?

No, not talking about “coalition”, actually, funnily enough, or indeed the acronym “COL”—Charlie Oscar Lima—which I won’t go into on this occasion; it wouldn’t be appropriate. So just “(Coal)” on the face of it—the coalface of it, so to speak.

So moving on, finally, to a couple of other suggestions, perhaps, it could be called the “Crown Minerals (Climate Change Impact) Amendment Bill”. Again, in the spirit of bipartisanship, recognising the significance that both sides of the debate place upon this bill, well, there will be some sort of impact, and we can all agree on that—whether it is substantial or insubstantial is a question of debate. But, actually, more significantly, in relation to the discussion we are now having in this committee, on this side of the Chamber we believe actually that the impact will be real but will be adverse. The reason for that is outlined much more eloquently than I’ll be able to manage—but, briefly, to make sense of my title-related suggestion is simply that the impact will be adverse because we’ll end up as a country importing energy from overseas that is less clean than that which we are extracting and supplying and consuming locally already. So “(Climate Change Impact)” would be a suggestion to allow both sides to claim some sort of moral victory.

Then, finally, the “Taranaki Economy Impacts Bill” would be another way of characterising this piece of proposed legislation. The disappointing aspect of that is that that can only mean one thing: it could not be, in this case, both positive and negative in a Schrödinger’s cat kind of way but actually only could be negative. It couldn’t be anything else inside that policy box; it could only be a negative effect on a part of the world that has actually served our country very well and, indeed, other parts of the world in splendid fashion too. If we’re considering climate change or global warming as a global problem, we need to see it in these terms, not just in view of New Zealand’s emissions, but, none the less, I am sad to report, as my various title suggestions make clear, that I think that these will not be served well in that regard either.

Thank you, Madam Chair. It’s a pleasure to be taking a call tonight on the title clause of the Crown Minerals (Petroleum) Amendment Bill. I do so with some hesitation, actually, because I don’t typically take calls on title clauses, but I genuinely think tonight that they have titled this bill incorrectly, because there is no suggestion in here of what the bill does. It mentions petroleum, which is fair enough, but it doesn’t talk about the fact that permits will be ended. It’s not very specific at all in what the bill’s intent actually is. So I’ve got a few suggestions which I’d like to put before the committee for consideration.

The first one of those is the “Crown Minerals (Effect on Regional Development) Amendment Bill”. And the reason for that is that I think even the members opposite would appreciate there will be an effect on regional development, not just in Taranaki, of course. My good friend from Taranaki, Jonathan Young, has been talking about the impact on Taranaki, where there’s something like 15,000 jobs that are reliant on the oil and gas sector. And so I think that to adequately portray what this legislation does, we do need to be talking about the effect on regional development in Taranaki and also in other parts of the country, because it’s not just Taranaki that it will affect; it will also be other parts of the country. As we know, the legislation does lay out that Taranaki onshore will be protected for at least the short term, but it’s silent on—in fact, it bans—any other development in any other part of the country.

The example I used earlier in the debate was my area of South Canterbury, which will be affected, and this bill will affect it and that’s why I think it does need to be talking more about the effect on regional development in the title of the bill. There are 3,100 jobs on the line—the Barque development would create 3,100—and so that will have an impact on regional development if that development doesn’t go ahead.

The second one I wanted to point out was just in relation to the consultation process that we’ve gone through on this bill. And so the second title I’d suggest would be the “Crown Minerals (Four Weeks’ Consultation) Amendment Bill”. And, again, I think that would quite adequately portray the process that we’ve gone through, because, again, I think members opposite would appreciate that it has been a truncated process. Generally, legislation goes off to select committee for about six months. This select committee, the Environment Committee, had just four weeks to consider it. That included two weeks of hearings and two weeks of consideration.

💬 Barbara Kuriger: Hearings but not much listening.

And so, as part of that, they didn’t go off—exactly; not much listening—to Taranaki, for example, which is very disappointing when the majority of jobs will be lost there. So I think that if we are to properly portray what process this legislation’s gone through, we should consider changing the title to the “Crown Minerals (Four Weeks’ Consultation) Amendment Bill”.

The third one I’d like to put on the table for members to consider is the “Crown Minerals (Environmental Impacts) Amendment Bill”. Again, I think members opposite have talked at length today about the environmental impacts of the oil and gas sector, and I don’t think they’d get too much argument from this side of the Chamber. Of course there’s an environmental impact from the oil and gas sector. Again, as my colleague Jonathan Young has pointed out previously in the debate, there is already transition under way. Most companies and others are transitioning away from fossil fuels, and you see that with the likes of Fonterra moving away from coal. And so when we talk about this bill—in particular, when we talk about the title of the bill—we should be considering what the environmental impacts are.

We look at the advice that the Government’s received, and I just want to point to the Ministry of Business, Innovation and Employment’s (MBIE’s) advice, where they made two particular comments. The first one is that the net impact on global emissions is uncertain but more likely to be negative rather than positive. And that’s quite an important point, which I think should be reflected in the title of the bill, rather than just calling it the Crown Minerals (Petroleum) Amendment Bill, which doesn’t talk to the reasons that the Government’s putting the bill up. They’re talking about the environmental impact, so that should be reflected in the title of the bill. And unfortunately, as MBIE’s own advice has pointed out, the environmental impacts are negative.

The second thing they go on to say is that it will result in a likely increase in global greenhouse gas emissions in the short to medium term, and that’s the advice I found particularly remarkable. Again, it should be reflected in the title of the bill, because what members opposite haven’t done, simply by putting “(Petroleum)” in the title, is talk about the fact that the impact on the environment in the short to medium term will be negative rather than positive.

So I think any one of those three titles would more adequately reflect what the content of the legislation is. Simply putting “(Petroleum)” in the title doesn’t talk about the economic impacts on regions, it doesn’t talk about the process that we’ve gone through to get here, it doesn’t talk about the environmental impacts, and it certainly doesn’t even talk about the fact that we’re ending permits for offshore oil and gas exploration. Thank you.

I move, That the question be now put.