The New Zealand Parliament has enacted a bill that lifts the prohibition on oil and gas exploration outside the Taranaki region.
This legislative move aims to align the country's decommissioning practices with global standards.
Initially imposed by former Prime Minister Jacinda Ardern in 2018, the ban aimed to address climate change concerns and reduce the country's dependence on fossil fuels.
Taranaki is an energy-rich region on the country's North Island.
Resources Minister Shane Jones confirmed the decision following the third reading of the Crown Minerals Amendment Bill.
The changes reflect the government's objective to enhance investment in Crown-owned mineral resources.
Starting in September 2025, operators will have the opportunity to apply for new permits for petroleum exploration.
The legislative process highlighted a gap in the existing Crown Minerals Act concerning the financial responsibilities for decommissioning petroleum infrastructure.
In specific scenarios, parent companies of permit-holders could sell their shares without being held accountable for decommissioning costs, which could pose a financial risk to the Crown.
Most provisions of the new bill will come into effect immediately, while others will require a phased implementation and additional legislation.
All modifications are expected to be fully operational by the end of September 2025.
Jones said: “This government is pragmatic about the vital role natural gas will play in our energy mix in the decades ahead and we have set a course for greater energy security backed by our own indigenous reserves.
“The ill-fated exploration ban in 2018 has exacerbated shortages in our domestic gas supply by obliterating new investment in the exploration and development needed to meet our future gas needs. Reserves are also falling faster than anticipated.
“New Zealanders are bearing the brunt of this constrained gas supply, and energy security concerns are impacting investor sentiment. These factors are taking a toll on our economic growth and prosperity.”
