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New regulations for exploratory drilling

Hon Amy Adams
Minister for the Environment

27 February, 2014

New regulations for exploratory drilling

Activities involved in exploratory drilling for oil and gas will be classified as non-notified discretionary under new EEZ Act regulations, Environment Minister Amy Adams announced today.

“The non-notified discretionary classification is the pragmatic option for exploratory drilling, and will provide a level of regulation proportionate to its effects,” Ms Adams says.

“This is part of the National-led Government’s overhaul of the laws and regulations governing the oil and gas industry.

“The classification will provide effective oversight and environmental safeguards without burdening industry with excessive costs and timeframes.”

Exploratory drilling is the drilling of an offshore well to identify oil or gas deposits under the seafloor, and to evaluate whether they would be suitable for production.

As part of the marine consent application, operators will need to submit an impact assessment that identifies impacts on the environment and existing interests. The impact assessment must describe any consultation undertaken with people identified as existing interests.

The Environmental Protection Authority (EPA) will fully assess the effects of the activity on the environment and existing interests. If a marine consent is granted, the EPA can impose such conditions as it thinks necessary to properly manage any adverse effects of the activity.

Obtaining a marine consent to drill an exploratory well does not give the consent holder the right to begin producing oil or gas.

The operator would need to apply for a separate, discretionary marine consent before any production activities could take place. During this stage, the public would have the opportunity to make submissions on the proposed activities.

The decision for activities involved in exploratory drilling for oil and gas to be classified as non-notified discretionary follows a seven week consultation period on the draft regulations from 12 December 2013 to 31 January 2014.

Public consultation on the regulation of activities involved in exploratory drilling also occurred during August and September last year.

The new regulations come into effect on 28 February 2014.

The EEZ Act came into force on 28 June 2013, bringing a comprehensive approach to managing activities in the exclusive economic zone and continental shelf.

Under the EEZ Act, activities can be classified as permitted, discretionary, non-notified discretionary or prohibited.

ENDS

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