Ban on new offshore exploration estimated to cost $7.9 billion

While Jacinda Ardern is getting celebrity attention in New York the cost of reality hits home here.

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Government officials have estimated that the cost to New Zealand of banning new offshore oil and gas exploration permits will be $7.9 billion between 2027 and 2050.

The advice is contained in a just released regulatory impact statement (RIS) by officials from the Ministry of Business, Innovation and Employment.

It was previously known that officials opposed the move, but the estimated cost to the Government is new.

The $7.9 billion estimate is the midpoint of a series of estimates that vary widely with different variables but represents a medium exploration scenario.

Foregone revenue to New Zealand could be higher under high exploration, $14 .3 billion, or as low as $2.7 billion with low exploration.

But Energy Minister Megan Woods contests the estimates.

Her statement on the bill, says the modelling by officials was based on a GNS report for inputs and the report itself expressed caution about relying on resource estimates, saying “this study attempts to qualify what is almost unquantifiable.”

Woods’ statement also said the model used for estimating the cost was unable to take into account any potential from existing exploration permits, covering 100,000 sq km.

The new advice has been released alongside the Crown Minerals (Petroleum) Amendment Bill which gives effect to the ban announced in October by Prime Minister Jacinda Ardern, Regional Economic Development Minister Shane Jones and Climate Change Minister James Shaw.

In New York:  UN gathering puts further distance between Ardern’s NZ and Trump’s America

“We have a number of challenges quite specific to New Zealand in the particular drugs that are present, but also in taking a health approach. We want to do what works and so we’re using a strong evidence base to do that.”

Ardern’s stance that New Zealand prefers an “evidence based” approach to drugs is a direct challenge to the US administration’s rhetoric on the issue, and it is not the only area where both countries are increasingly talking a different language.

I wonder what evidence they based their rushed decision on banning new offshore exploration.

 

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71 Comments

  1. Blazer

     /  September 24, 2018

    so ,we know NO ONE can accurately predict that far out.
    So throw this b/s into an incinerator.

    A house in Sandringham will probably cost $7.9 billion in 2050 going by the current inflated ponzi scheme..

    Reply
    • Corky

       /  September 24, 2018

      Billions of dollars lost because of a flawed philosophy. The philosophy of losers. Man, that’s a lot of money that could have soothed many a socialist itch. Roll on 2020.

      Reply
      • Blazer

         /  September 24, 2018

        not one $ has been lost.
        M.B.I.E are fucking hopeless.They still miss free spending Joyce who oversaw profligate spending on consultants and vanity purchases.

        Mr Bridges thinks 40% of profits from oil coys is a great deal..what a muppet.

        Reply
    • Griff.

       /  September 24, 2018

      Indeed
      How can they give a value for regions that are unexplored as yet ?
      The most likely prospect licenses including much of offshore tarnaki are still available for exploration and will be open until at lest 2030.
      Seems the Ministry of Business, Innovation and Employment has oil on its breath.

      Reply
    • PDB

       /  September 24, 2018

      Blazer: “so ,we know NO ONE can accurately predict that far out. So throw this b/s into an incinerator.”

      Yet you are seemingly defending a decision based solely on three party leaders doing a dodgy deal behind closed doors with no official advice as to the cost of doing so and whether or not doing so will actually achieve what they want.

      Reply
      • Blazer

         /  September 24, 2018

        what official ‘long term advice is/has been reliable iyo?

        Reply
        • PDB

           /  September 24, 2018

          Anything would be better then trusting the economic instincts and spur of the moment brain farts of Ardern, Winston and whatshisname…

          Reply
          • Griff.

             /  September 24, 2018

            Argument from ignorance
            Just because you have no fuckin idea why they did something does not mean they had no idea.

            Early action on climate change would save New Zealand $30b, report finds
            Climate change is “a serious long term threat” to New Zealand’s economy and delaying action to address it could lose the country billions, a banking leader says.

            Moving to a low carbon economy sooner rather than later would allow New Zealand to reap up to $30 billion in economic benefits, a report commissioned and publicly released by Westpac found.

            The bank commissioned the report so it would know the financial risks climate change posed to both the country and its business. The modelling was undertaken by EY and Vivid Economics.

            The report modelled two different paths to meeting New Zealand’s obligations under the Paris agreement: A proactive ‘central scenario’, in which the transition to a low-carbon economy was quick and smooth; And a reactive ‘shock scenario’, in which the transition was slow at first with a dramatic cut in emissions from 2030.

            The economic benefits of a fast transition were significant, it found. While short-term growth would be stronger under the ‘shock scenario’, the economy would take a hit once sharp carbon reductions were required later on, potentially as a result of trade tariffs or other sanctions.

            Based on the projected economic growth rates of both scenarios, an early transition would have a cumulative economic benefit of about $30b by 2050. Agriculture, in particular, would take a financial hit if the transition to a low-carbon economy was delayed, and everyday household costs would likely go up.

            It will be at lest a decade even if we find nothing in the still active prospects before we run out of gas.
            More than likely we will find enough under the existing permits to keep us going for at lest a decade longer .
            A strong signal has been given to industry that the future will be carbon neutral .
            It is important that industry know that it will be uneconomic to invest in carbon heavy infrastructure with a life time of more than say thirty years .

            Reply
            • robertguyton

               /  September 24, 2018

              Agreed.

            • PDB

               /  September 24, 2018

              Griff: “Just because you have no fuckin idea why they did something does not mean they had no idea.”

              You have no ‘fuckin’ idea that they had an idea of what they were doing Griff. In general however you have no ‘fuckin’ idea so par for the course.

            • Griff.

               /  September 24, 2018

              Read the west pack report
              30 billion if we dont start switching our economy now.
              There are plenty of other reputable sources that agree with west pack.
              All you have is your own ignorance.

            • PDB

               /  September 24, 2018

              Congratulations Griff! A clean sweep for you!

              *Have an exaggerated sense of self-importance
              *Have a sense of entitlement and require constant, excessive admiration
              *Expect to be recognized as superior even without achievements that warrant it
              *Exaggerate achievements and talents
              *Believe they are superior and can only associate with equally special people
              *Monopolize conversations and belittle or look down on people they perceive as inferior
              *Be envious of others and believe others envy them
              *Behave in an arrogant or haughty manner, coming across as conceited, boastful and pretentious
              *Insist on having the best of everything — for instance, the best car or office

            • Corky

               /  September 24, 2018

              Griff is a cut and past boy, PDB. Hasn’t got an original thought is his head. See his clip below for an idea of his ”inner landscape.”😄

            • Griff.

               /  September 24, 2018

              ROFL
              Yeah whatever .

              Try to have an informed opinion rather than gibbering nonsense and you will not look like such a halfwit .

            • PDB

               /  September 24, 2018

              Obviously you were in the room with the three party leaders when the decision/deal was made between them as you seem 100% certain of what occurred & what their decision was based upon? What an idiot.

            • Corky

               /  September 24, 2018

              Please don’t become upset, Griff. I was just pointing out what an infantile prat you are. That clip you posted below proves that.

            • Griff.

               /  September 24, 2018

              .

            • Corky

               /  September 24, 2018

              What’s the use of posting that? Implement it. Meanwhile the clip below is still infantile in my opinion.

            • PDB

               /  September 24, 2018

              Please Corky – show some compassion.

              https://www.wikihow.com/Deal-with-a-Narcissist

  2. robertguyton

     /  September 24, 2018

    What a load of tosh. Corky rose to it though, so has humour value.

    Reply
    • Corky

       /  September 24, 2018

      Lol…let’s see how that fiscal hole Joyce predicted turns out. Minus the billions lost from the petroleum industry..and we will have real humour value. Only it won’t be very funny.

      Reply
  3. robertguyton

     /  September 24, 2018

    “this study attempts to qualify what is almost unquantifiable.”
    There’s the money quote.

    Reply
    • PDB

       /  September 24, 2018

      If anything their estimate will be conservative.

      Reply
      • robertguyton

         /  September 24, 2018

        Think of the time-at-sea they’ve saved Russel Norman!

        Reply
        • PDB

           /  September 24, 2018

          Norman should have shelved the wetsuit as his whole career has been all at sea.

          Reply
          • robertguyton

             /  September 24, 2018

            He’s gone from strength to strength – it’s interesting to see that departing Green MPs go straight to directorships in banks, as the National MPs do – not. They do something worthwhile after their time in Parliament.

            Reply
            • PDB

               /  September 24, 2018

              The Green MP’s have to try at least Robert – to make up the fact they do nothing whilst in parliament.

            • robertguyton

               /  September 24, 2018

              Nothing, PDB? Then you’ll not be sheeting home to them the blame for the exploration ban.

            • PDB

               /  September 24, 2018

              Of course not Robert – Winston did a deal with Labour over oil and gas – the Greens just scramble for crumbs in this govt as you well know.

            • robertguyton

               /  September 24, 2018

              Sweet. I’ll remember how you’ve absolved The Greens from blame over the exploration ban.

            • PDB

               /  September 24, 2018

              By all means Robert – knock yourself out. If anybody is to blame it is Winston as he failed to support the regions by agreeing to it. Shane Jones in the photo says it all. Not really worth arguing about it however as National should reverse it when next in govt.

      • Blazer

         /  September 24, 2018

        yes in 2050 ..gas guzzling cars will be everywhere.

        Reply
      • Corky

         /  September 24, 2018

        I wonder if Robert believes in those climate change models?

        Reply
        • Griff.

           /  September 24, 2018

          Reply
          • Kitty Catkin

             /  September 24, 2018

            I see that the next story is about a Messerschmidt….an elderly, now late friend used to like to see people’s reactions when he told them that his father owned one and used it every day to go to work,,,,it was also a brand of car/.

            Reply
            • Gezza

               /  September 24, 2018

              Yup – I remember seeing one of those. 😀

            • Kitty Catkin

               /  September 25, 2018

              I never have, and had no idea that they existed. T used to have fun telling people that his father went to work in a Messerschmidt 😀

            • Gezza

               /  September 24, 2018

          • Gezza

             /  September 24, 2018

            Have a google for screen licker gif. There’ll be some that’ll just play on posting rather than having to be clicked to play.

            Reply
        • robertguyton

           /  September 24, 2018

          There are models that are more than models? I don’t believe you!

          Reply
  4. Alan Wilkinson

     /  September 24, 2018

    Obviously the officials are wrong when they say it will cost $7.9B and have little impact on climate change. It will have no detectable impact on climate change.

    Reply
  5. Gezza

     /  September 24, 2018

    Ardern’s stance that New Zealand prefers an “evidence based” approach to drugs is a direct challenge to the US administration’s rhetoric on the issue, and it is not the only area where both countries are increasingly talking a different language.

    Huh? So far, in this area, haven’t Labour done next to, well, not to put too fine a point on it, fuck all?

    Reply
  6. Geoffrey Monks

     /  September 24, 2018

    Guess I got a bit late into this one….. From my perspective, any attempt by lil ole no Zealand to change the course of global climate change is pointless – whatever measures we take unilaterally will achieve nothing. Except that it will allow some posturing and feel-good fuzzies for those proposing the move.
    When the calculated cost to the nation of that gesture is examined, we have a real problem. Shooting oneself in the foot is rarely a recommended course of action. Allowing one’s mate to do the shooting so that he can feel good has even less to recommend it.
    Does anybody seriously believe that oil in the ground in our area of strategic interest will be left there simply because a half dozen hopelessly sincere kiwis insist on it?
    Own it, defend it, exploit it. If not us, somebody else will.

    Reply
    • PartisanZ

       /  September 25, 2018

      That’s a fabulous argument for just letting stuff happen to us Geoffrey …

      Where did you find it? Dare I ask … What language? German?

      Personally, I’m pretty sure the existing exploration licenses will take care of our oil needs as we transition to a lower fossil-fuel dependent ‘economy’ …

      An economy, of course, being everything we are … an agglomeration of units of production and consumption …

      Reply
      • Geoffrey

         /  September 25, 2018

        Thought I would give it a go in English… Being “pretty sure” is not a good enough basis for an abrupt cessation of exploration. Expecting the scrabble for dwindling supply to by-pass us is a cheap short-term position to adopt. It will cost so much more in the longer term. Not to worry, the architect of this policy will be out of office and the rest of us can get on with the hoping part of the strategy.

        Reply
        • Griff.

           /  September 25, 2018

          Being “pretty sure” is not a good enough basis for an abrupt cessation of exploration.

          Pretty sure you are dribbling nonsense.
          There is no “abrupt cessation of exploration” there is a halt to issuing new permits.
          All existing exportation permits already issued carry on unchanged.
          Searching the permit areas already issued will keep the exploration industry busy for at lest the next decade.
          It takes far longer than a decade to go from the start of exploration to production especially as the most likely prospects are down south far from the present infrastructure clustered in taraniki.
          If you think the goverment over the past decades have not already issued permits for the most likely exploration areas I have a bridge you might be interested in.
          Beat up comments like yours propagate ignorance.

          Reply
          • Geoffrey Monks

             /  September 25, 2018

            Insulting the commentator does not contribute to advancing any greater understanding of the issue. The technique does have the potential to discourage real examination though. Good luck with that.

            Reply
            • Griff.

               /  September 25, 2018

              Making up shite is not “advancing greater understanding of the issue “.

              Does anybody seriously believe that oil in the ground in our area of strategic interest will be to go on with left there simply because a half dozen hopelessly sincere kiwis insist on it?

              The number of Kiwis who think we should move away from oil exploration is orders of magnitude greater than your imagination has supplied.

              whatever measures we take unilaterally will achieve nothing.

              We are not acting unilaterally to combat climate change.
              191 other country’s signed up to Paris accord with the intent of acting beside NZ.

              If you can not get even the basic facts right your comments can legitimately be dismissed as full of dribbling nonsense.
              Dont like being called on it ? try to base your opinions on something closer to reality next time .

  7. As usual it was a cantankerous waste of time response.

    Reply
    • Reply
    • Geoffrey

       /  September 25, 2018

      Your persistence (Griff) in posing as a bloke who knows the real stuff and can therefore condemn opposing view points as “dribble” is truly awesome. Stick with it and don’t, whatever you do, let an original thought enter your head.
      In the meantime other commentators might consider, just for a moment, the disparity between the cited billions of dollars that NZ will necessarily borrow so that it can be invested in some vague remedial programme and the .016% of the carbon “problem” for which we are alleged to be responsible. Without the US and China in particular actually committing to reduce their emissions, the only change that our proposed huge investment will bring about is to our further indebtedness.
      In my view, the world will not quietly transfer its energy needs from petro-chemical to carbon neutral electricity sources. On the contrary, there is likely to be a huge ruckus as the big users vie for what is left in the ground. If NZ does not identify and demonstrate ownership of that resource, it (like the water that we have recklessly allowed to be stolen from under our noses) will be taken from us. Moreover, it would almost certainly be exploited in less carbon-friendly ways than would be the case if it were left to us to manage.

      Reply
      • robertguyton

         /  September 25, 2018

        How can our oil resources “be taken from us”, Geoffrey? Some sort of invasion? If that’s what you are expecting, how does this Government’s decision about new exploration affect that?

        Reply
        • Geoffrey

           /  September 25, 2018

          In international manoeuvring, If you don’t have your boot on the ground and a pointy stock in your hand, you own diddly squat.
          The invasion, when it comes, will comprise a bunch of smiling gentlemen with very attractive credit notes to share around as they ‘help’ us to process what is ours. They will stop smiling if and when we feel a wee bit deprived.

          Reply
      • Griff.

         /  September 25, 2018

        Slowly
        There is no abrupt halt to oil exploration in NZ .
        There are 100,000 sq km under existing permits that are as yet unexplored to prospect.
        So that comment was what you technically call a lie .
        That you don’t like being called on a lie don’t change the fact you lied .

        NZ emits 0.17% of global emissions not your 0.016% percent so again your view is based on your imagination not reality.
        https://en.wikipedia.org/wiki/List_of_countries_by_greenhouse_gas_emissions
        As we make up only 0.06 of the global population we are emitting more than our share on a per person basis.

        Without the US and China in particular actually committing to reduce their emissions,

        The USA has already reduced its emissions .
        https://climateactiontracker.org/countries/usa/
        The United States proposing to withdraw from Paris depends on Trump staying in the white house another term. I dont give that prospect high odds. The indervidual states have taken over from the federal Government when it comes to climate change .

        China has committed to holding its emissions per person to a reasonable level as it brings it population towards the level of prosperity enjoyed by the first world.
        It is well inside of its commitment to stop increasing emissions by 2030 in fact it emissions have remand fairly stable since 2014.
        https://climateactiontracker.org/countries/china/

        The rest of your rant seems to consist of Paranoid fear that someone is coming to steal our as yet undiscovered gas.
        Sorry that is insane.
        Anyone seeking to take over another country’s resources would target existing fields not a gamble that oil even exists undiscovered here to expliot .

        Reply

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