New Zealand: gets ready to rumble
New Zealand unveils action plan
New Zealand's government has released an action plan aimed at maximising its oil and gas potential that includes a review of the fiscal regime.
The National-led government has been in power for one year, and has a pro-petroleum and minerals agenda in sharp contrast to the previous government.
Energy Minister Gerry Brownlee today unveiled at the Biennial NZ Oil and Gas Outlook 2009 conference the new action plan, with a specific focus on exploration of New Zealand’s deep-water basins.
"The development of our resources needs to be driven by the private sector," said Brownlee. "Billions of dollars are required. None of this investment is owed to New Zealand by right.
"The petroleum business is capital intensive and risky. Businesses will only invest if they see a reasonable prospect of an economic return. We are in competition for this investment with other countries.
"To succeed, we need to ensure New Zealand is a highly attractive global destination for petroleum exploration and production investment."
The impetus for the action plan was provided by a recent study by GNS Science showing significant petroleum potential in 10 basins.
There are several parts to the action plan and, by December 2010, the aim is to make necessary adjustments to the regulatory, royalty and taxation arrangements for petroleum, plus amend the legislative framework for the petroleum sector.
An independent study had concluded New Zealand’s petroleum regime was generally fit for purpose and provided an attractive investment climate for potential investors.
However, it also recommended refinements, including reassessing taxation arrangements around marginal fields.
"Let me repeat that this government is serious about raising New Zealand’s living standards," said Brownlee.
"We are serious about raising our export levels and increasing economic growth. That means we are serious about unlocking the potential of our considerable petroleum endowment."