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PCE Interim Report: No Moratorium on Fracking

PCE Interim Report: No Moratorium on Fracking

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By Mark P. Williams

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The Parliamentary Commissioner for the Environment today released its interim report on the risks and benefits of hydraulic fracturing, or 'fracking' to New Zealand. The report concludes that there is no reason to suspend the use of fracking. It went on to say that although there are risks arising from the use and expansion of fracking these can be reduced with proper regulation and implementation of appropriate best practice as in other industries.

The interim report also indicated that the main problems with the industry are the complex and context dependent nature of the relationship between the type of fracking being undertaken and the geological and hydrological nature of the area it was taking place.

In a presentation on the report, Dr Jan Wright explored these issues and took questions from the press (see below).

The interim report emphasised three main issues it was necessary to address:

1: Complexity and accountability
Finding out precisely which department has oversight of what stages of the process such as:

  • Environmental Risk - This varies depending on very specific local conditions but permits granted often cover very large areas allowing companies to decide where to drill without reference to local or central govt
  • Standardisation and Best Practice - Companies drilling wells are often using different designs and construction standards
  • Well Integrity - It is still unclear whether the primary responsibility for maintaining wells responsibly in each case falls to Regional Councils orThe High Hazards Unit
  • The Ministry for the Environment has not provided any specific guidance to councils on the subject of fracking
  • 2: "Light Handed" Regulation

    The interim report identifies a global shift over a thirty year period towards industry-led regulation, leading to low governmental oversight.

    In New Zealand companies appear to regulate and monitor their own behaviour. The report cites the well-examination scheme of the UK, supervising the construction and maintenance of wells, stating that New Zealand has no such scheme. The report observes that NZ companies are required to provide highly technical information to councils but that there is no guarantee that the information will be fully comprehended, and thus no guarantee that councils can effectively debate the implications of the information, leading to poorly-informed decision-making.

    3: The "Social License"

    The report states that the full extent of environmental risks, such as groundwater contamination, and the economic benefits, such as replacing coal resource consumption with comparatively cleaner gas consumption, must be integrated into a system of "golden rules" for when fracking is viable and acceptable.

    The interim report concludes in an open-ended manner by observing that fracking in New Zealand has not yet earned its "social license" to operate in terms of a popular disposition to accept it but that, equally, there was no cause to recommend a moratorium on fracking.



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