Petroleum Development and Environmental Conflict in Aotearoa NZ Dr Terrence Loomis

The NZ petroleum industry Over 100 years in existence, concentrated in the Taranaki region 17 other petroleum basins with ‘huge unexplored potential’ More than 20 major and medium capital E&P companies operating Over 190 drilling, geoscience, engineering and service companies Crude oil exports contributed $2.2 billion to GDP (in 2009) $700 million in royalties & tax revenues (in 2009) 3700 full time employees (in 2010) 275 exploration permits issued since 1995

Why National chose to expand O&G development in NZ? The 2008 international financial crisis (the Great Recession) A mounting government debt burden and lagging GDP A ‘sustainable GROWTH’ (neoliberal) ideology informing economic development policy A global commodities boom; O&G industry interest in NZ’s ‘frontier’ potential Formulation of the Business Growth Agenda aimed at boosting petroleum exports tenfold to $30 bn by 2020

Government’s manoeuvres to expedite oil and gas development

A coordinated legislative reform agenda (RMA etc) ‘Factual’ information dissemination (MBIE: E Coast) Ministerial propaganda, cheerleading and jawboning Subverting local community power Agenda-driven funding: subsidising international investment and ‘buying’ community compliance Encouraging local government gate-keeping and O&G advocacy

Industry strategies to promote and defend the oil and gas industry

PR spin and ‘reasoned’ debate targeted at Middle NZ Neutralising environmental opposition Influencing government policies and regulations Co-opting communities and ‘partnering’ with iwi

Environmentalist & community group activities

Grassroots research – sometimes called “citizen science” Public awareness-raising, information dissemination and education Engaging with and influencing government institutions Organisation, multi-level networking and alliance-building Confronting oil and gas corporations and exposing their strategies Māori self-determined development and anti-oil resistance

Is government investment in O&G devt a good idea? the global context Unconventional (fracking) shale gas/tight oil boom & bust Increasingly volatile oil and gas markets Mounting evidence of industry risk and harm Paris Climate Accords (leave 70% of reserves unburned) Growing shareholder/finance sector concern over ‘stranded assets’ & govt subsidies Big Oil companies planning to transition out of fossil fuels TAG Oil’s Waitangi Valley-1 well, Gisborne

Local context: Unimpressive industry performance Job, contractor cuts: Taranaki 7.3% unemployment in 2015 (highest in NZ) Crude oil contribution to GDP $1.7b in 2016, down 23% over five years Rapid drop in annual permits (1 in 2016); only 17% of 275 issued still active Royalties and tax revenues down from $700m in 2009 to just over $300m last year Permit fees down 32% over past six years 150 ‘dangerous occurrence notifications’ reported to the High Hazards Unit between 2012-2015 Companies exiting or reducing CAPEX, focusing on seismic & existing production, and hoping for a market upturn (i.e. boom and bust cycles)

Political conflict has undermined state and civil/LG sector institutional relations Paternalistic state centralism is undercutting emergent localism & community empowerment Representative governance superseding participatory democracy ‘Sustainable growth’ pre- empting a ‘sustainable development’ approach to resource management

Four key messages from my research 1. Mounting evidence of petroleum industry risk and harm 2. The petroleum industry is a bad government investment 3. Government’s push for expanded O&G development is undermining long-standing institutional relations and values between the state and civil society 4. Communities, NGOs & councils have less influence over energy policy, regional development & natural resource management (signs of the ‘Resource Curse’?)

www.terrenceloomis.ac.nz Lexington Books An imprint of Rowman & Littlefield, Lanham, MD USA http://www.rowman.com/lexington