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Crown Minerals Act review shows stretching timeline

Crown Minerals Act review shows stretching timeline for legislative change

First published in Energy and Environment on August 29, 2019.

The release of the Government’s proposed Resources Strategy shows ever-extending timelines for legislative change reforming the Crown Minerals act and implementing a ban on mining on conservation land.

The Strategy says the wider review of the Crown Minerals Act will kick into gear once the Resource Strategy is finalised as will further work on the ban of mining on conservation land.

Debate on the wider issues will centre around the purpose of the CMA with environmental groups objecting to it being an enabling of mining and not a restriction on its more damaging aspects.

The Government’s proposed Resource Strategy says the review of the CMA will “make sure it is fit for purpose to meet the needs of NZers” and the Strategy will “inform this review”

“While the Government recognises the value of mining to NZ, the “no new mines on conservation land” objective aims to make sure that mining is done in the right place, in the right way. A discussion document will be released in the coming months asking for feedback from the public. This Strategy will accommodate the final results of this policy.”

The Strategy says the CMA review will modernise it and “play a role in setting the direction of the sector and in supporting the no new mines on conservation land objective”.

“Given the demands of a rapidly changing energy system, and NZ’s transition towards a low emissions economy, our needs from the minerals and petroleum sectors are constantly changing. As the demands on the sector changes, so too must the regulatory system respond and adapt to ensure the sector is best placed to meet these demands.”

On 12 April 2018, the Government announced there would be no further offshore oil and gas exploration permits granted. It further limited new petroleum exploration and mining permits to the onshore Taranaki Region only. This announcement did not however, impact existing rights.

This is described as Tranche One of the CMA Review which concluded in the Crown Minerals (Petroleum) Amendment Act 2018.

In November 2018, the Government started Tranche Two of the CMA Review to provide an in-depth look into the issues affecting the CMA. “A discussion document on the CMA Review will be released for public consultation in late 2019, once the Strategy has been finalised,” but the Terms of Reference will “explicitly address”:

• The fundamental role of the CMA and purpose statement;

• Land access arrangements;

• Non-interference provisions;

• Liability and financial assurance;

• Compliance tools;

• Iwi engagement and community participation;

• Petroleum permitting; and

• Technical amendments.

On November 8, 2017, the Government announced there would be no new mines on conservation land. “The details on this policy are being considered. A discussion document is expected to be released in the coming months that will ask for feedback”.

Other action areas in the Resource Strategy document include ‘Securing Affordable Resources to Meet Mineral And Energy Needs’.

“We do not have a complete understanding of our entire stock of resources. It is important that we build this knowledge base as it informs many of the choices we will confront in future. For example, understanding of the complete stock of NZ’s resources will enable better nationwide spatial planning, so mining of available deposits can occur where it has minimal negative impact. In particular, understanding NZ's stocks of clean-tech minerals is valuable for supporting the transition to a carbon neutral economy. Looking ahead, NZ’s resource needs will change. We need to understand whether these needs can be met from our own resource base, can be met by recycling resources, or whether we need to provide for these needs in alternative ways.”

Officials have completed ‘Mineral Potential Studies’ (lithium, rare earth elements, and nickel-cobalt) and studies into the lithium potential of the Taupo Volcanic Zone. They were also working on regional aeromagnetic and large scale geochemical soil sampling, as well as better understanding gas supply for energy security and improving systems to make minerals data more accessible.

There was now a greater focus on permit compliance with a dedicated team inspecting 69 sites in early 2019. “These inspections led to some further inquiries being made, some compliance actions being undertaken, as well as referrals to other regulators.”

“Looking towards the future, we hope to integrate some of our historic information with our new data to give us a better understanding of our petroleum assets. We also hope to overlay this data with royalty information. This will further help ensure that the Crown is receiving a fair financial return.”

First published in Energy and Environment on August 29, 2019.

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