By Jonathan Young, National’s Energy and Resources spokesperson.
OPINION: The Minister of Energy and the Labour-led Government ignored the advice of their officials that curbing new oil and gas exploration would hurt the economy and do not achieve the sole purpose of helping to reduce emissions.
Now the private sector has done its own economic analysis. If anything, the report from the reputable NZIER paints an even gloomier picture than the Ministry of Business Innovation and Employment (MBIE) had.
They put the cost to our economy at $28 billion or 5 per cent of GDP. For Taranaki, the region which I represent and love, our GDP would shrink by almost 50 per cent. That’s $20,000 a year of spending power lost by Taranaki households from now until 2050. That will hurt the families who live in my electorate.
Nothing this Government has announced for Taranaki in particular and New Zealand as a whole goes near filling the black hole created by the exploration ban.
This isn’t just about a few drilling rigs. There are 11,000 jobs at stake, exports of $1.5 billion a year, $500 million in royalties and taxes. There are engineering firms, manufacturers dependent on natural gas, service industries ranging from plumbers to welders, lawyers, designers, accountants.
North Islanders have enjoyed cheap and abundant natural gas for more than 25 years thanks to the Maui field. It is troubling that thanks to this Government’s lack of analysis, it pushed ahead with the ban on ideological grounds and as a result New Zealand has only about 10 years of reliable supply left.
More troubling is that the ban, while hugely symbolic for the coalition, fails in its primary purpose. NZIER noted that New Zealand’s contribution to the global reduction of emissions ‘is undetectable’. It was good intentions, no delivery.
The Minister has locked us on a track she claims will take us on a seamless journey to a low-carbon economy. In reality there is no track, just a lot of talk about new technologies coming to the rescue.
Will they appear in time and in sufficient quantity to prevent a significant energy gap for New Zealand? We don’t know, because this Government didn’t do research on that before closing the tap on one of the country’s most important energy sources.
Current investment by oil and gas companies like OMV is not directed at exploring for new gas, but maintaining current gas fields. The Minister is trying to paint a bright future but has no basis for that as she has ignored all advice, has no research and has refused to consult. When respected independent analysis challenges her view, she attacks it; showing how hollow her argument is.
The Government made a reckless decision, didn’t consider the consequences of its actions and the real impacts it is and will have on New Zealand families.
Jonathan Young is National’s Energy and Resources spokesperson.