Crown Minerals Amendment Bill

2.1. Are there any publicly available inquiry, review or evaluation reports that have informed, or are relevant to, the policy to be given effect by this Bill?

NO

2.2. Does this Bill seek to give effect to New Zealand action in relation to an international treaty?

NO

2.3. Were any regulatory impact statements provided to inform the policy decisions that led to this Bill?

YES

MBIE completed the following regulatory impact statements on the proposed changes in the Crown Minerals Amendment Bill on 15 May 2024:

·       Amendments to the Crown Minerals Act 1991 relating to petroleum exploration

·       Amendments to the Crown Minerals Act 1991 relating to small scale non-commercial gold mining.

They are available at: https://www.mbie.govt.nz/dmsdocument/28877-regulatory-impact-statement-amendments-to-the-crowm-minerals-act-1991-relating-to-petroleum-exploration-and-mining-proactiverelease-pdf 

MBIE completed an annex to Regulatory Impact Statement: Amendments to the Crown Minerals Act 1991 relating to petroleum exploration and mining on 30 October 2024 in relation to extending trailing liability for decommissioning costs to certain persons with controlling interests.

It is available here: https://www.mbie.govt.nz/dmsdocument/29856-annex-to-regulatory-impact-statement-amendments-to-the-crown-minerals-act-1991-relating-to-petroleum-exploration-and-mining-pdf

MBIE updated the annex to the Regulatory Impact Statement: Amendments to the Crown Minerals Act 1991 relating to petroleum exploration and mining on 24 March 2025. It is available here: https://www.mbie.govt.nz/dmsdocument/30925-annex-to-regulatory-impact-statement-amendments-to-the-crown-minerals-act-1991-relating-to-petroleum-exploration-and-mining-proactiverelease-pdf

MBIE prepared a Supplementary Analysis Report Amendments to the Crown Minerals Act 1991 Decommissioning Regime on 16 June 2025 in relation to removing automatic trailing liability for immediately previous permit holders. It is available here: https://www.mbie.govt.nz/dmsdocument/30926-supplementary-analysis-report-amendments-to-the-crown-minerals-act-1991-decommissioning-regime-proactiverelease-pdf

2.3.1. If so, did the RIA Team in the Treasury provide an independent opinion on the quality of any of these regulatory impact statements?

NO

The Ministry of Regulation’s RIA team delegated the responsibility for providing comment on the quality of the regulatory impact statements, annex and supplementary analysis to an MBIE Quality Assurance Panel. The Panel considered that:

·       the information and analysis in the Regulatory Impact Statements (15 May 2024) partially meets the criteria necessary for Ministers to make informed decisions on the proposals.

·       the Annex (30 October 2024) and updated Annex (24 March 2025) meets the RIS QA criteria.

·       the information and impact analysis summarised in the Supplementary Analysis Report (16 June 2025) partially meets the Quality Assurance criteria. The Panel consider that the Supplementary Analysis Report would benefit from: further analysis of the guardrails to support Ministerial discretion to address any risk/perception of risk of regulatory capture and to ensure discretion is exercised in a consistent manner; and consultation on the proposed changes, particularly with iwi and hapū.

2.3.2. Are there aspects of the policy to be given effect by this Bill that were not addressed by, or that now vary materially from, the policy options analysed in these regulatory impact statements?

YES

The Climate Implications of Policy Assessment (CIPA) team was consulted and confirms that the CIPA requirements apply to the proposal to remove the current ban on new petroleum exploration and measures to improve investor confidence. The associated disclosure sheet is available at Climate Implications of Policy Assessment disclosure sheet (mbie.govt.nz)

2.4. Has further impact analysis become available for any aspects of the policy to be given effect by this Bill?

YES

In September 2024, further whole of energy system modelling was published by MBIE. This is available here: Crown Minerals Amendment Bill modelling (mbie.govt.nz)

2.5. For the policy to be given effect by this Bill, is there analysis available on:

(a)   the size of the potential costs and benefits?

NO

(b)   the potential for any group of persons to suffer a substantial unavoidable loss of income or wealth?

NO

The size of potential costs or benefits from the amendment to reverse the exploration ban and changes to improve investor confidence are largely dependent on the increase in oil and gas exploration. No quantified estimates are available as costs and benefits cannot be accurately estimated.

The potential costs of the changes to assigning liability for unmet decommissioning costs are difficult to quantify and will, for each permit, depend on the estimated cost of decommissioning, amount of any financial securities and extent to which the permit participants cannot meet their decommissioning obligations. 

2.6. For the policy to be given effect by this Bill, are the potential costs or benefits likely to be affected by:

(a)   the level of effective compliance or non-compliance with applicable obligations or standards?

NO

(b)   the nature and level of regulator effort put into encouraging or securing compliance?

NO

The size of potential costs or benefits from the amendments to reverse the exploration ban and improve investor confidence are largely dependent on the increase in oil and gas exploration. The level of effective compliance or non-compliance, and the level of regulator effort into encouraging or securing compliance, will not substantively impact this.

3.1. What steps have been taken to determine whether the policy to be given effect by this Bill is consistent with New Zealand’s international obligations?

New Zealand’s international obligations were considered during the policy development process.

3.2. What steps have been taken to determine whether the policy to be given effect by this Bill is consistent with the principles of the Treaty of Waitangi?

Treaty analysis

MBIE undertook Treaty analysis during the development of this Bill. The analysis considered what effect the policy would have on Māori, what the Treaty/Māori interests are, what Treaty arguments might be made against the policies, and how we are meeting the good faith obligations of the Crown. The good faith obligations have been limited by the speed and urgency given to this Bill.

Meeting Treaty settlement obligations

MBIE has specific consultation obligations set out in Treaty Settlement Protocols, Accords and Relationship Agreements. Some Crown Minerals Protocols in force have an obligation to consult on wider policy and legislative developments related to Crown-owned minerals. Each protocol is different, but the same themes are recurrent. They set out specific basic principles that will be followed in consultation, including:

·       consultation as soon as reasonably practical following identification and determination of the proposal or issue

·       providing sufficient information to make informed decisions and submissions

·       ensuring sufficient time for participation in the decision-making process and to prepare submissions, and

·       ensuring consultation will be approached with an open mind and genuine consideration will be given to submissions received.

An online hui was held prior to Cabinet decisions with the Minister for Resources and Minister for Māori Development, with iwi and hapū with whom MBIE has Treaty settlement commitments or with whom MBIE has a relationship with. A second online hui was with Taranaki iwi focused on the proposed changes of significance to Taranaki iwi. Following feedback from iwi that was critical of the nature of the engagement and limited time to provide written submissions, further hui were held that introduced the proposed CMA amendments as decided by Cabinet, with a wider group of iwi and hapū. Further opportunities to provide written feedback were provided.

The intention with these changes is not to impact rights and interests that have been provided or recognised through the Treaty settlement process. The specific consultation requirements set out in many of the Protocols, Accords and Relationship Agreements will continue unchanged.

There was no specific Treaty analysis undertaken for the amendments to assigning liability for decommissioning costs. In earlier engagement, MBIE received submissions from iwi and hapū which generally supported strengthening the decommissioning regime including: retaining decommissioning requirements including financial securities, trailing liability, and liability in the post-decommissioning period.

3.3. Has advice been provided to the Attorney-General on whether any provisions of this Bill appear to limit any of the rights and freedoms affirmed in the New Zealand Bill of Rights Act 1990?

NO

The Ministry of Justice’s advice to the Attorney-General is publicly available at Advice on consistency of Bills with the Bill of Rights Act | New Zealand Ministry of Justice.

The Ministry of Justice did not raise any issues about the New Zealand Bill of Rights Act 1990.

3.4. Does this Bill create, amend, or remove:

(a)   offences or penalties (including infringement offences or penalties and civil pecuniary penalty regimes)?

YES

(b)   the jurisdiction of a court or tribunal (including rights to judicial review or rights of appeal)?

NO

The Bill allows for liability for petroleum infrastructure decommissioning costs to be assigned through Ministerial discretion. The Ministers can consider requiring an outgoing guarantee for relevant decommissioning costs from an outgoing person or a related body corporate as part of permit transfers and changes of control of permit participants that require prior Ministerial consent.

Currently under the Crown Minerals Act 1991, if a change of control of a Tier 1 petroleum permit operator goes ahead without prior Ministerial consent, then:

·       the incoming person (ie the new shareholder) commits an offence if they knew, or ought reasonably to know, they would obtain the controlling interest (section 100(2A))

·       the permit operator commits an offence if they knew, or ought to have known, about the change of control and fail to notify the Minister (section 100(2A)).

The Bill amends the change of control provisions by (see clause 26B):

·       requiring prior Ministerial consent for change of control of petroleum permit participants who are not operators (these currently only require notification after the fact)

·       broadening the definition of change of control to include transactions where a person ceases to have a controlling interest (currently only where a person obtains a controlling interest).

This means the offences in section 100(2A) will apply to those scenarios.

The Bill also allows for pecuniary penalties under section 89ZZV to apply to an outgoing person if a change of control goes ahead without prior Ministerial consent (see clauses 26B, 26C and 45).

Clause 45 repeals section 89ZZV(1)(a)(iv), which are the pecuniary penalties associated with the existing post-decommissioning requirements, that are being replaced by clause 43.

3.4.1. Was the Ministry of Justice consulted about these provisions?

YES

The Offences and Penalty Vetting team at the Ministry of Justice were consulted. They advised that these proposals did not raise any issues or require changes.

3.5. Does this Bill create, amend or remove any provisions relating to the collection, storage, access to, correction of, use or disclosure of personal information?

YES

The Bill amends or creates powers to require information as part of regulatory decision-making:

·       Clauses 19, 28, 41 and 46 create information gathering powers for assessing Tier 3 permit applications.

·       Clause 28, new section 41AG(6) creates a power for the Minister to require information about the technical capability of a permit operator who is undergoing a change of control.

·       Clause 29A, new section 41H creates a power for Ministers to require information to assist them in determining whether to require an outgoing guarantee and by whom the guarantee should be provided.

Section 90A of the Crown Minerals Act 1991 imposes restrictions on the disclosure of information obtained under various sections of the Act, and this section will apply to a number of the information powers created by the Bill.

3.5.1. Was the Privacy Commissioner consulted about these provisions?

NO

The Privacy Commissioner was not consulted during policy development.

The Privacy Commissioner was invited to make a submission on the Bill to Select Committee. The Commissioner’s submission is available here https://www.parliament.nz/en/pb/sc/submissions-and-advice/document/54SCEDSI_EVI_81dbd590-6e68-48d1-8be4-08dcdc4c6a57_EDSI7201/privacy-commissioner  

3.6. Has there been any external consultation on the policy to be given effect by this Bill, or on a draft of this Bill?

Yes

Limited and specific engagement with iwi and hapū went ahead of Cabinet decisions in 2024 to satisfy obligations as set out in Crown Minerals Protocols, Relationship Agreements and Accords. A further hui was undertaken with Taranaki iwi focused on the proposed changes of significance to Taranaki. Following Cabinet decisions, further engagement took place with a winder group of iwi and hapū.

Feedback from iwi and hapū noted strong opposition to removing the ban on new petroleum exploration permits beyond onshore Taranaki, and concern over the lack of robust consultation and engagement.

Industry have been consulted on the proposed changes throughout the development of the Bill. Industry supported removing the ban.

Environmental groups were briefly consulted on the proposed changes, and noted their opposition to the proposed changes.

Changes to the petroleum decommissioning regime relating to trailing liability 

Key industry stakeholders were consulted on the changes relating to assigning liability for decommissioning costs. They were consulted on proposed policy and provided feedback on an exposure draft of the Amendment Paper. They were generally supportive of the discretionary approach, but preferred that no form of trailing liability apply.

Iwi and hapū and environmental groups were not specifically consulted on these changes (see 3.2 above re Treaty analysis).

3.7. Have the policy details to be given effect by this Bill been otherwise tested or assessed in any way to ensure the Bill’s provisions are workable and complete? 

YES

New Zealand Petroleum and Minerals, the government regulator that manages New Zealand's Crown minerals estate, has assessed the provisions in the Bill and are comfortable that these achieve the policy intent of the Bill.

Crown Law and an external barrister were engaged on the draft Amendment Paper that related to assigning liability for petroleum decommissioning costs.

4.1. Does this Bill contain any provisions that could result in the compulsory acquisition of private property?

NO

4.2. Does this Bill create or amend a power to impose a fee, levy or charge in the nature of a tax?

NO

4.3. Does this Bill affect rights, freedoms, or impose obligations, retrospectively?

YES

Clause 50 of the Bill amends Schedule 1 of the Act to include transitional provisions (as new Part 6):

·       Clause 48 of the Schedule retains existing trailing liability for former permit holders that applies as a result of permit transfers consented to after the 2021 Amendment Act came into effect. This liability continues until a transfer or change of control is consented to under the proposed provisions (after commencement of the Bill). The trailing liability of former permit holders under the existing law is extinguished when Minister consents to a transfer or change of control under the proposed provisions. This clause does not impose obligations retrospectively, but releases obligations retrospectively because there will be an opportunity for Ministers to look at new transactions and consider requiring an outgoing guarantee.

·       Clause 49 of the Schedule applies the proposed law to applications for changes of control and transfers that have been made since 13 March 2025 (when the sector was informed of the proposed changes) but are not determined before commencement. For applications for permit transfers, this will mean an outgoing guarantee can be considered instead of automatic trailing liability for former permit holders. For applications for changes of control, this means an outgoing guarantee can be considered, and the transitional is necessary to ensure the policy change is not avoided before commencement. This clause does not affect existing rights, only applications.

4.4. Does this Bill:

(a)   create or amend a strict or absolute liability offence?

NO

(b)   reverse or modify the usual burden of proof for an offence or a civil pecuniary penalty proceeding?

NO

4.5. Does this Bill create or amend a civil or criminal immunity for any person?

NO

4.6. Does this Bill create or amend a decision-making power to make a determination about a person’s rights, obligations, or interests protected or recognised by law, and that could have a significant impact on those rights, obligations, or interests?

NO

4.7. Does this Bill create or amend a power to make delegated legislation that could amend an Act, define the meaning of a term in an Act, or grant an exemption from an Act or delegated legislation?

YES

Clause 40B of the Bill amends the ministerial exemption and deferral power for petroleum decommissioning to consider exemptions and deferrals for either the whole or parts of particular items of petroleum infrastructure.

Clause 49 makes a corresponding change to the class exemption and deferral regulation-making power in section 105(1)(qb).

Clause 50 of the Bill amends Schedule 1 of the Act to include transitional and savings provisions (as new Part 6). Clause 51 of the Schedule creates a regulation-making power that allows for transitional and savings provisions to be made by regulations concerning the coming into force of the Amendment Bill. Regulations made under this power can be in addition to, or in place of the transitional and savings provisions in the Bill and may provide that specified provisions of the Act do not apply, define specified terms, and apply provisions repealed or amended by the Bill. The regulation-making power and any regulations made under it are only effective for up to 2 years after the commencement of the clause.

4.8. Does this Bill create or amend any other powers to make delegated legislation?

NO

Clause 49 of the Bill allows:

·       requirements for the work programme for Tier 2 permits to be specified in regulations.

·       arrangements or other things that are or are not to be treated as financial securities to be prescribed in regulations.

4.9. Does this Bill contain any provisions (other than those noted above) that are unusual or call for special comment?

YES

Clause 2 of the Bill provides that provisions relating to Tier 3 permits will commence on a date to be appointed by order in council, with a backstop commencement date of 1 January 2026.