Energy Minister Parata says NZ cannot ignore economic potential of fossil fuel resources due to global demand, eyes further exploration

Energy Minister Parata says NZ cannot ignore economic potential of fossil fuel resources due to global demand, eyes further exploration

New Zealand cannot ignore the importance of fossil fuels and the potential economic benefits that continued global oil demand could bring to the local economy, Minister for Energy and Resources Hekia Parata says.

Releasing the New Zealand Energy Strategy, Parata said the government remained committed to a policy for 90% of New Zealand's energy to come from renewable resources by 2025. However fossil fuels would continue to play an important role both domestically and abroad.

“We can’t just turn off the tap in our journey to a lower carbon economy. We also can’t ignore the major economic opportunity that continuing global oil demand could provide New Zealand. Petroleum was our fourth biggest export earner in 2010," Parata said in a media release announcing the energy strategy.

A report prepared by Woodward Partners on potential royalty income for the government from New Zealand's petroleum estate estimated the State could be in line for NZ$12.7 billion in royalties if current exploration rates were to double. Parata said this money would go towards paying for government expenses, although there had been no consideration of a Norwegian-style sovereign wealth fund.

“The specific areas that we’re putting it into are improving our education system, providing for our health system, building roads of national significance, rolling out ultra-fast broadband across the country. All of the revenue that we derive from this source is put into funding the kinds of amenities and services that New Zealanders expect,” Parata said.

However there was no plan for a specific sovereign wealth fund that resource revenues would be placed in for the funding of those amenities and services.

“We haven’t been considering that at the moment.”

Peak oil?

Meanwhile, despite being asked three times, the Minister said she had no comment to make on the concept of peak oil.

See the release from Parata below.

The New Zealand Energy Strategy and the New Zealand Energy Efficiency and Conservation Strategy released today by the Acting Minister of Energy and Resources, Hekia Parata, show an energy future that delivers for all New Zealanders.

“New Zealand is blessed with an abundance of energy resources,” says Ms Parata.

“Our Government’s goal is to make the most of all the assets we have – hydro, wind, geothermal, oil, gas and minerals.

“We want to use those resources responsibly to secure our energy future and to lift our standard of living.  That is why the Government is taking a balanced approach to building a sustainable energy and resources future."

On the renewables side of the energy and resources portfolio, New Zealand’s renewable energy levels are the second highest in the OECD, behind Iceland.

“Renewables and energy efficiency are a big part of our energy picture,’’ says Ms Parata.

”Renewables made up 79 per cent of our total electricity generation in the March 2011 quarter. New Zealand has a target of 90 per cent of electricity generation to be from renewable sources by 2025, and we are well on our way to achieving that.’’

Like the rest of the world, New Zealand needs a range of renewable and non-renewable energy sources to meet its energy needs in the immediate future.

“Fossil fuels will continue to play an important role in the global economy. Around half of the energy we currently consume is from petroleum,’’ says Ms Parata.

“We can’t just turn off the tap in our journey to a lower carbon economy. We also can’t ignore the major economic opportunity that continuing global oil demand could provide New Zealand. Petroleum was our fourth biggest export earner in 2010.’’

In addition to the energy strategies, the Minister today released an independent report assessing New Zealand’s oil and gas potential.

The Woodward report shows that New Zealand is set to earn more than $3 billion in royalties from oil and gas fields already in production.

That could increase to $12.7 billion with future discoveries, which would help pay for schools, hospitals, broadband and roads.

“People want to be sure that the environment is protected and they also want jobs and growth,’’ says Ms Parata.

“We have seen the difference the oil and gas industry has made in Taranaki, employing over 5,000 people (in 2009) and contributing $2 billion to our country’s GDP.’’

Environment Minister Nick Smith last week introduced legislation to manage the environmental effects of activities in New Zealand's Exclusive Economic Zone and Extended Continental Shelf and announced interim measures to manage the environmental effects of activities before the new law is passed.

Labour Minister, Kate Wilkinson, has also announced the establishment of a High Hazards Unit of eight inspectors specifically dedicated to the petroleum and mining industry.

The Minister of Transport is also reviewing the liability insurance requirements for the industry and is looking to raise it above the current level of NZ$30 million.

“Together these measures provide assurances that the industry operates within a sound regulatory and operational framework.’’

Ms Parata also announced today proposed changes to the way permits are issued for oil and gas exploration. Currently companies can apply to explore any area in New Zealand, the proposed approach would see the Government open up a limited range of specific areas for tender.

“The proposed approach would allow us to focus on areas of greatest potential, and will be more transparent for the public, who would know which areas are available for permitting and which are not. Communities and iwi would have an opportunity to comment on the proposed areas to be opened up,” says Ms Parata.

There is a 40-day working period for which people can make submissions on the proposed change to the permitting system.

Ms Parata also announced the Government is reviewing the Crown Minerals Act (1991) and that a Discussion Document will be put out for consultation before the end of the year, with revised legislation in 2012. This follows on from the earlier round of consultation in August 2010.

“The Act is 20 years old and the review will focus on updating and aligning it with the Government's economic agenda,’’ says Ms Parata.

For more information on the following reports go to:

Energy strategies –

Woodward Report –

Proposed permitting changes –

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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FYI Parata refused to comment on peak oil in the press stand up afterwards.

Thats the most interesting thing...isnt it....

So the Q is why?

Could it be because teh second you admit Peak Oil and that its here then the "belief" we can grow goes straight out the window....

and what is JK saying?  "robust growth" (or some such)....

That to me makes it look like one huge lie.


You just don't get it do you steven...the vast bulk of the peasantry act like sheep and this will not change...tell them they will see pink pigs flying across the sky and they will look up...all part of the game steven...You will likely be screaming "peak oil" to the day it runs out.

Note the rise of the birdflu virus in day the mutations of this thing will solve the overpopulation problem and when that happens, there will be far less demand for oil.

Hence why good journalists should pick up such things and pursue them.


It is highly probable he thought 'peak oil' was an oil company and something he shouldn't talk about...ask first if the minister has the ability to think!

So Alex as a journalist what are you going to do about an Energy Minister/spokesperson who refuses to answer a question?

Hopefully you will pursue it with great vigour?

I dont suppose you got him/her on camera?  I'd love to see that, body language means so much the written word cant squim factor....or the eyes....either or both can tell the real truth....unless he/she is good at poker.....


Hi Stephen, no camera for that bit. She just wouldn't comment on it. I asked, and a few others tried to follow up, but she just said she had no comment to make on it.

Something to pursue though.



Do you have any pieces on Jerry B talking about energy going back 2~3 years? I seem to recall him talking about expanding our electricity supply using Natural Gas?  Very little in renewables?  yet this speech seems to have a lot of renewables in if Im right thats quite a change in 2~3 years?


”Renewables made up 79 per cent of our total electricity generation in the March 2011 quarter. New Zealand has a target of 90 per cent of electricity generation to be from renewable sources by 2025, and we are well on our way to achieving that.’’

Except its too slow...if ASPO and the ppl I read ie experts are right, Peak oil has come and gone in 2006~2008 or will be gone by 2012 maybe as late as 2015, small chance its 2018, almost zero is 2020 or later....

So the Qs

1) What the Govn doing to protect NZ as a Nation against the coming energy shock?

2) What is the Govn planning to do if the oil shock is within this decade and not 10 or 20 years away?

3) So we have 79%....trouble is our energy needs are growing at 4%? per does that 100% mean 100% of our needs for electricity in 2025, or 100% of today's value?

4) If its within 5 years and thats 95% certain IMHO, what happens to the 21% short fall? energy brownouts? rolling blackouts?

5) Where is the resilience for a dry year(s)?  Why isnt the Govn ensuring we have continuity of supply in all reasonably foreseeable situations?  What are teh reasonably foreseeable situations?

6) Does the Govn have any plans to assist the owners to get the 75% completed tallow to bio-deisel plant completed ASAPP?  What about getting more plants built? At least one on south island?  To do this the company wanted a small subsidy or % of fuel sold to continue....why wont the Govn do that?

Interesting thing, I think business men in Govn are as big a failure as lawyers....just for different reasons.

Oops  90%....not 100%....


wats the gummint gonna more roads of course! 

...anyhting else is way tooo hard..

Argentina grapples with gas shortage

So how would NZ do?


The Woodward report can be read at Note that the $12.7b figure is the net present value of all present royalty streams and future discoveries, it is not the income per year. I couldn't find the discount rate in the report, maybe 10% so the income per year would be about $1.3b. That seems about right because the 2008 income from all mineral royalties (including oil) was $340m (which included the big oil price spike).

Also, the $12.7b is the high estimate. The report actually says that "We view the prudent valuation for the Crown's royalty from future discoveries as $5.5b". Plus $3.2b from present fields gives a total of $8.7b. 

NZ's royalty rate of 20% on profits seems quite low although each country uses different systems so it is hard to make a comparison. Canada uses 30%, UK uses 50% on fields approved from 1983-1993. 


good on the Minister for not commenting on peak oil nonsense,big bang theory or evolution for that matter

Facts on carbon dioxide :

 Inventing a pollutant:

 Prof Bob Carter on whether we face dangerous global warming:


Wind is neither free nor clean:


Wind Energy on Trial in Colorado:


Why you should oppose the Carbon Tax:


LOL you are more entertaining than the Simpsons.  The interesting fact is she didnt deny it but refused to comment, that speaks volumes....she for one must know (and by extension the Govn and JK)....or she would have publically dismissed it....with something like its 30 years away, or no such thing is a silly theory etc etc....but we didnt get that.

Simple, Peak oil output is a geological fact, the only Q is when...

eg Crude oil output peaked in 2006, 5 years ago....that peak output has not been exceeded since.....if that doesnt scream "peak production" I dont know what does.

What you dont get with these pieces is they scream there is no viable alternative to fossil fuels on the scale needed. So we have to stick to fossil fuels, but then supply and demand kicks in.....the cost will rocket.

Next irrifutable fact is, our entire global economy's well being is linked to fossil fuels and a growth in its supply.

So you should be able to deduce that if we accept your pieces on the face of them, then the Q is whats going to happen as oil output declines and the price goes so hugh that businesses, and ppl cant cope....its ugly to say the least.


It doesn't scream peak production to me, you can have peak production long after peak oil.  Crude has peaked, the non conventional oils have not.  I agree though we are dealing with a 'non renewable' resource.  We don't yet have a viable alternative so we are in trouble.

Peak oil is refered to as Peak crude oil production....If you look from about 2005 gas condensates have been able to make up for the shortfall/decline in crude and add a "Peak Oil" is yes, peak liquids is probably not. Even that isnt far fact in might have been 2008, could be 2012...possibly out as far as 2018.....most likely before 2015.

Crude oil has been on a plateau since about 2004~2005 its been pretty falt for 6 years and the real worry is the longer we stay on the plataue its highly likely the worse the initial drop will be after 15% per annum could be a real eye waterer....


Yes could be. But Peak oil could also be 2014, or 2018, but maybe it might even extend out to 2035 if the peak doesn’t happen until 2016 and the world’s economy doesn’t pick up until 2014.  But I’m picking it was actually in 2003 because by 2008 oil field production had already declined. So then that would mean it was in2011, because it would have to come after 2009 which was the year things really went flat. Of course, some really smart analysts reckon it will be 2017 as it will take that long to work through all the gas unless you count in the finds in wherever it was which will take it out until 2023, or possible 2024 or 2025, or 2026 at a stretch? But I’m not so sure of that as I still favour 2007 due to the petant curve that PDK is an expert in and has schooled me up on.

But don’t you worry, it’s definitely coming. Make no mistake about it. And when it does to all you deniers, well what can I can say? I told you so.

In terms of demand and  a recession delaying the peak, thats an interesting point and I assumed initially it would make a big difference myself.  It seems not, the pieces Ive seen suggest that a recession would delay the peak by a matter of handfuls of months and not a handful of years....unless we are talking a depression on the scale thats almost un-imaginable....really scary.  Then of course no one invests in developing oil fields as the price is way to low, so supply drops off a cliff.  That also means Saudi (for one) cant get a good enough price to bribe its ppl with.....I dont know which way to look for the most scray possibility in that scenario....

For the actual peak being much later than 2012 the % chance is dropping significantly.....I forget the exact numbers but I think its something like <5% for 2018 or later, 2030s seems something silly like for risk management purposes it should be discounted IMHO.

Actual date, depends on which experts I guess, ther eis clearly some guess work and interpretation of the numbers involved.

2003 would seem one of the earliest numbers, the generally accepted graphs show crude climbing until 2004 then a fairly slow climb to then drops, with gas condensate as "all liquids"  peaking in 2008....2011, or 2012 might see another condensate peak or it might not, some think it will, Im watching with great interest.

Whether its 2003 or 2016, its within 15 years....Certainly all the switched on ppl Ive read and can reasonably trust as honest / genuine say 2006 to 2018...

"which will take it out until 2023, or possible 2024 or 2025, or 2026 at a stretch? " Ive not seen anyone who I would say was amongst the most credible, knowledgeable and experienced ppl go past 2018......but there are unknowns....but its not 2030s....even if it was Govn's should be thinking in 25 year time frames...we now with accepted data have at most 6 years, but probably not even that...

"I told you so."  Pollies have been told....I think there is enough info and it should have got to a high enough level that I cannot believe they are not aware of the situation, risks and impacts. The very fact that this "minister" wont comment is telling....she should be sacked as in-competant...however I cant see anyone else who is capable....






Come on Nats -   lets get into exploiting the minerals this country is blessed with and get NZ back on its feet and provide real jobs. Stuff the greens,enviro fundies and bearded,cardigan wearing,sandal shod losers. Go NZ  !

and what happens when they are used up? and we have nothing left?

On the other hand we could exploit them at  a slow rate so they last many many decades ensuring our future.

Look at the UK, its exhausted its coal and all but exhausted its oil and gas....its now crunch time...all you have achived is acontinuation of teh un-sustainable a while longer.....instead of moving to a workable path.


Lean in closely, Steven, while I whisper this in your ear.  There is another source of combustible liquid fuel out there, but one that for you and probably for most, will come from a source where you least expect it. You're so dead wrong mate. Dead wrong.

This is an active area of work as we speak. And it’s already way beyond the proof of principal stage. And when it comes to pass, and we run out of fossil fuels, that moment will be nothing other than a passing moment of academic interest to a small few. Am I going to tell you what it is? Hell no! I love watching you flat earth greenies flapping your cake-holes in ever increasing hysteria, making wild and exaggerated claims.  

That has to be a Tui statement David.

Yeah right!

"Dead wrong."  I would be very happy for the ppl Ive read and regard as the experts to be proved wrong....because the impact if the ppl Ive read are right is scary.

Please go for it and tell me.

Ther are lots of active areas of alternatives, Ive not seen one yet on a vialble one.

For instance Gerry B was talking about the deep sea methanes frozen down deep at one stage as NZ having the easiest access.....Where in this speech is that commented on? it looks to be back to fossil fuels and now finally renewables.

We wont run out of fossil fuels for 40 years, what we do have is peak production in them about now.  So your mythical solution needs to be production ready now.....literally what ever it is has to put down now and scale to 6% replacement of fossil fuels starting today.



We won't run out of fuel ever, Steven, so long as the sun shines. There are very clever people on this planet Steven, much cleverer than you or I, and they are working on this matter as we speak.  And people who think that human ingenuity is at an end or that it can't solve this problem are simply fools. 

What I am talking about is renewable, sustainable liquid fuel (not fossil fuels Steven, or methane at the bottom of the sea, or hydrogen cells) that will fit perfectly in with the existing infrastructure.  Does the technology exist? You betcha it does, and it’s only going to improve with time as all new technologies do. But not in NZ mate. Too many bearded sandal wearers in this county all talking about their Petant curves.

I'm not going to tell you what it is Steven, because the less you type of people know about it the better. I want to see this technology (which is no secret by the way, and it is based on sound orthodox boring old proven science) fully develop before you flat earth greenies try desperately to block it with your strident hysterical mumbo jumbo. But I will be interested to see how long it takes before the penny drops and the news media switch on to it.

Frankly I think you are full of Bull.

OK I tell you what I'll believe it when I see it.....because

a) It has to be available today in a production-isable form.

b) It has to be scalable to 4% of oil consumption per year starting today.

Let alone if it actually works....

So bring it on, because all I see from you is blind faith on something unsubstantiated....something you claim you know the ppl who know the solution to when, reality check I see nothing to indicate there is any such thing out there in the real world.

"type" oh as in an engineer....oh right.......its beginning to sound more and more like make believe.

"Greenie" yet more bull....Im not a flat eather, ppl who think we can expotentially grow are flat earthers...

So the mumbo jumbo is far more likely to be coming from the camp who are "inventing this" , but you know invest in it.  You stand to become one of the richest men in the world.





In answer to your questions, a) Yes b) Yes.

Just so you know I’m not pulling your leg, Steven, one of the places involved in this work that I am aware of has 8 technical advisers (senior scientists) from such institutions as Harvard, MIT, Penn State, Stanford, Boston U. A board of directors where half the board has science PhDs, and a management team that is similarly skilled and qualified in a range of scientific disciplines.

This is mainstream, Steven, and it’s all about science. It’s not lalal land. That’s for you cardy wearing greenies.

Think you may be right David B.

Now then, can I run my household electricity supply from a similar source, in which case I now understand why we need to sell off the power generators.... and quickly too (I won't be buying shares in them as a result, unless I can palm the shares off overseas).


ha ha ha real jobs.  Just like the clowns who wanted to clear fell the west coast years ago!! Dah...if they had, the coast would be a mess and tourism would be nil. 

Go the greenies......they make more and more snse as time marches on...scarry aint it, we remian in denial mode and it wil all go away......cockoo cockoo

 I also think we should scratch mother earth a little bit deeper under her skin and see if she can have a few more "MG & North sea - vomits".

Why do people fit solar water heating systems....paying high rise prices plus gst plus council fees!

One of your dimmer comments Wolly. I suggest you look again at the economics (most systems now have 7-10 year payback). Here in Nelson solar water fitting is exempt council fees - should be rolled out nationwide. Grants are also avaialble from EECA.

Im not aware its council fee free in Wellington (it wasnt anyway)   you had to pay at least one inspection fee, so several hundred $.

Ive been looking at DIY kits....seems to be about $4k........but I suspect there is a huge margin there.....needs to be sliced a bit yet....


We got one as our old cylinder failed so were up for part of the cost anyway.  Now the hotwater is switched off from Sept- may.

Hekia Parata is shaping up as a credible minister in so much as she sees her role as acting in the interests of the whole country and not just pursuing a narrow portfolio of Maori interests.  Compare her efforts to those of fellow Coastie ex-Labour Party Minister Parekura Horomia.   She stood fast in the face of the rant by the headless Chicken Littles from the Coast who demonstrated, with the Green's urging,  against the explorative work on hydrocarbon resources in the Raukumara Baisin north east of Bay of Plenty.  You should hear these same headless souls squealing now that petrol and diesel are no longer available in Tokomaru Bay because the local service station has gone belly up.  Great practice for them for post peek oil days!!

You think the two events are linked?

The linkage is the H word, H for hypocrisy.    Or if you live in whitey suburbia; "Nimbyism"


"credible" when she refuses to comment on peak oil, that doesnt make her credible, it makes her a lair....

I fail to see how loosing a petrol station has the slightest bearing on whether drilling is done in a particular spot.....So you/they have to drive 8km for petrol? 



"credible" when she refuses to comment on peak oil, that doesnt make her credible, it makes her a lair...."

Freudian slip, secret desire

Mining, oil and gas doesn't do jack for the economy.  If the way to wealth was owning lots of oil, Saudi Arabia would be the worlds No.1 economy.  Look at all the major oil producing countries in the world, and the minerals or precious metals they have available.  Now show me the correlation between having these natural resources and a wealthy country.  The correlation overall is negative.  That is most countries that have oil, or coal, or copper, or diamonds or gold are still 3rd world countries.  The companies that sell the oil on the other hand have some of the largest GDP's in the world.  (I can't find the place I saw that but whilst googeling I noticed many references to the BP oil spill increaseing GDP, thats great news)

Yep....interesting thing that.....usually the wealthy get richer....the poor are lucky if they dont get poorer...or in some cases shot, hanged or imprisioned.

If we were to find significant oil, really its a curse....our manufacturinng would collapse as we would be a petro-dollar. ie the exchange rate would be 1.2 to 1 and not the 0.84 to 1 we see today.  So we'd import everything, would the average NZer be better off? Would we do a Norway and lock in the revenue to benefit NZers or would our donkey Govn allow wholesale pillaging?  you just have to look at them to know its the latter.....I mean Brownlee? 



Yep, crappy third world countries, Norway, Canada, Australia spring to mind.

Yes, fossil fuel, I love that stuffs!  Got my winning lotto this weekend..

That 6.2 litre V8 HSV E3 Clubsport Commodore is waiting for me....  Fuel it up with super premium and turn up to the next Greens Party conference, I might even show Dr Norman how do a donut... (might cure his mid-life crisis)

So go buy one now, why wait.....spend $70k? on a car with maybe 5 years life in it....get it on HP at 23% over 5 years, makes so much sense. Then turn up and tell Dr N he's a d*ck.....he'll enjoy the laugh..........

Or alternatively get a MiEV and drive past the few petrol stations and gas guzzlers sitting on the road side out of gas in a few years time and wave....


The only things that come in 2 litres or less are milk, orange juice.. btw, it's 100K not 70K

MiEV, where do you think electricity comes from?  thin air...  With the onset of global warming - our hydro lakes will be struggling to cope with the demands if every men and their dogs bought those MiEV (+ heat pumps, LCD TVs....) .  Oh more wind farms??? they are struggling to get through the RMA process

MiEV, indeed electrical power will be a problem, but not having petrol or being able to afford it is even more of a problem.

However charging a car overnight is not a time dependant or rate problem (within reason).  So if it takes 2 hours to charge the car and you plug it in at 10pm and un-plug it at 7am, it had a 10 hour window to charge long as its full at 7am who cares?

Wind & RMA, indeed it is a problem and the NIMBIES are simply going to be over-run, there will be little option / tollerance on that.

This will also apply to tidal, with the cook straight we can generate power close to Wellington, if it chops a few dolphin in half, well I suspect we wont care / have much choice....

So what you are saying is it seems wind/EVs are out and Im saying Petrol will be out, that leaves us walking...or on the bus, look on the bright side they have 8litre(?)'ll just have to share the...uh....glory.

LCD TVs, etc....consumerism is dead RIP......we will be spending our spare energy getting essentials like food....such luxury purchases will be a rare event I suspect...something like going back to the 1950s or 60s.....


At least HSV will make me smile once in awhile.. rather than being like those miserable greenies on their rusty bike!

Lastly, I'd rather live in NZ with all resources available than living in NZ with nothing!

By a tesla can be a greenie and laugh at petrol stations, think they are about $150k though.


So when the resources are hard to get or not available you will do what?


Hey, aren't we all missing something here?

If NZ turns out to be the Saudi Arabia of the South Pacific the NZ dollar will soar and every dairy farmer and manufacturer/exporter will be on the dole. The govt will get royalties which will come nowhere near to covering the extra cost of running the country. In the meantime the cost of fuel will be linked to the world price and if its $200 per barrel, we will still be paying that international rate.

The govt is pinning its hopes on oil & gas discoveries but there is obviously more to this than meets the eye. The perceived blessing could well be a curse.

 No - no we cannot be Saudi Arabia (o.t.S.P) we do not have camels here.

ummm.. I can't tell which one got one lump and which has two lumps....  And if we are going to become Saudi Arabia, I would look silly with a white robe!

Apparently, Australia has the only population of wild camels.

  I think David’s dot below is an extremely wild camel’s droppings - 5km away.  

Camels aside, NZ's territorial waters are huge

see the last page here.

There are likely significant hydrocarbon deposits but finding and developing them is problematic and very risky, IMO. Anything found would take a very long time and stupendous amounts of money to develop. That oil companies would want to come down this way shows how desperate they are for new resources. 

I've always being surprised that there has been so litle drilling (if any?) in the lower half of the North Island in Wanganui, the Manawatu, the Wairarapa and Southern Hawkes Bay, and also out into the Wanganui Bight. Any ideas as to why that is?

They did an aerial survey some years back over the Manawatu using some specialised equipment - never heard any outcome though. Possibly the whole area is too new geologically - certainly there is potential for a major earthquake in the Wairarapa / Manawatu.

From the Dom.


Seismic study for lower North Island


Last updated 12:00 06/05/2011

An earthquake "as big as Japan" would devastate much of the lower and central North Island, if the Pacific and Australian plates were to rupture releasing all their energy, a GNS scientist says.

But a coast-to-coast seismic study of the plates will be the first time the boundary zone underneath the Wellington region has been studied in such detail. The project is being done by a team of New Zealand, United States and Japanese scientists, using equipment which GNS geophysicist and project co-ordinator Dr Stuart Henrys said would effectively provide a CAT scan of the earth's crust.

It is hoped information about the nature of the tectonic plates' activity would help prepare people for "whenever the big one hits".

"Without wanting to alarm anyone, if they ruptured and all of the built up energy was released in one go, it would be as big as the one in Japan, so yes the effects would be felt in the likes of Palmerston North and probably far further in all directions," he said. The information would be used to improve building design and help communities be better prepared.

Now, the Pacific Plate, to the east of the North Island, was being forced underneath the Australian Plate, but Dr Henrys said the two plates were not sliding past each other as they should. Rather, they were locked together in some places and it was only a matter of time before the built-up energy would be released.

"We want to understand a little more about that locking process with the plates so that before the day comes, we'll have knowledge of the type of shake that would be felt by people."

The project would see a number of "controlled earthquakes" – less than 1.0 magnitude – stretching between Paekakariki on the Kapiti Coast to Glendu Rocks in Wairarapa.

Explosives will be placed in 50-metre deep boreholes near seismographs, and scientists will be able to build a three-dimensional image of rock structures and the tectonic plate boundary beneath the lower North Island.

The earthquake-recording equipment will be deployed tomorrow.


Well I guess that's possible, but then Southern California has lots of oil fields, (used to produce 731,000 barrels/day in 2004, but is in decline) even in downtown Los Angles! They have large earthquakes there as well, so there must be something more to it than just that. Maybe the geography is not suitable in the lower North Island, but it’s hard to see how the rocks 2-3kms below ground could differ so dramatically from what is out under the sea??

The best theory they have (apparantly) is most oil is found where there is/was large / massive rivers leading into "stagnant" the missisippi and the gulf is a classic layout. Then its has to be there in a super-warm period, then with the microbes we need sedement deposits to hold it, salt cap to keep it in and the right depth to cook many factors to add up...



Pretty much the entire world has been surveyed....some say 4 times over...hence why they are so far offshore and so deep....and the returns on those are 3 to 1, which makes no sense....we need 10 to 1 for our society to function....otherwise we are simply robbing peter to pay paul....overall thats not good, but then markets/busniesses are not rational in a macro sense.



I suspect its unlikely on the significant bit....but I guess it depends on what you mean by significant....the odd billion barrels is peanuts...




And your point Is?

A mere dot upon the page.

It annoys me that the govt talks about pumping out everything that can be pumped "because we have no choice"

We do have choices - on the consumption side.  NZ is one of the most fuel-inefficient countries per capita in the world.  There are all sorts of things that could improve it - & save the country & its citizens $$

eg making the rego on bigger cars higher than for small cars - so encouraging the use of smaller ones.  As far as I can see most developed countries do this.  It is stupid that a 800cc Suzuki pays the same rego as a 5 litre SUV. 

Ditto with our ridiculously low fuel taxes.  Here we are borrowing 300m per week & we have one of the lowest fuel taxes in the OECD.  Thus encouraging imports of petrol that needs borrowing to pay for.

etc etc etc

Grump grump.  But seriously, what a dumb country we are at times!

Cheers to all.

If you can't beat them, join them!  Go out a buy a big 4WD and feel free to pay more for petrol if you wish (just send extra dollar or two per litre to Treasury Dept in Wellington). 

You must be seriously sick for wanting to pay more fuel tax!

Chairman Moa:  With all due respect, that is such a daft comment it hardly merits a response.

If you put more tax onto petrol (as almost every other developed country does, excepting those fine examples the Americans), then you can obviously reduce the tax elsewhere.  Just as GST was increased & PAYE reduced.

So it can be neutral.  Obviously. 



"Just as GST was increased & PAYE reduced" you must be very naive to think that - the net tax will still higher..

I'm certainly naive if I think that NZ has the capacity to develop a rational taxation policy that protects its own future best interests.

Depressing really


NZ's royalty rate of 20% on profits seems quite low

Why would NZ govt accept such low royalty?  It's practically giving the oil away to the oil company. 

Yes it is a pity politicial parties can hide their donations.

Royalties may be just a mirage. The Woodward report confirms domestic production is falling off a cliff and royalties with it.  The much hyped royalty figures are 10 years away and assume more oil will be found.

Meanwhile the ANNUAL cost to NZ of importing ever more expensive oil could rise by 2015 to $10 billion which is equal the cost to Govt of the Christchurch earthquake EVERY year.  $19 billion by 2020.

Even if new oil was discovered tomorrow none will come on stream for at least 5 years more likely 10 years.  While we wait for the govt's massive gamble to pay off --  the oil crunch for prices and supply is NOW ... 

What part of oil above $100 a barrel for over 6 months and the world economy stalling as a result does the govt not understand?  It received advice from officials in 2009  that NZ was more vulnerable to oil shocks than other OECD nations but ignored it.


Yes indeed.

If I recall correctly 11 wells were drilled in the Taranki basin and beyond in the last NZ drilling season. Not a single one hit commercial quantities of oil.

We are at best a 1 in 10 well oil province.

Its also noteworthy that the fields which have been discovered are pretty small (less than 100mb recoverable) and they deplete very rapidly. Just take a look at Tui - practically 70% of the oil extracted in a few years AND total reserves subsequently downgraded by 20%.

The other non-Taranaki fields better be a lot more impressive than that if the govt is going to get remotely close to the figures touted around today.

What happened to all the "think big" projects that Muldoon put in place in an attempt to reduce the impacts of oil shocks on NZ?  As far as I'm aware he was/is bagged for these ideas but seems to me that he showed some forward thinking that wasn't politically driven.

Oh I say...what a bloody laugh!

 CERN has joined a long line of lesser institutions obliged to remain politically correct about the man-made global warming hypothesis. It’s OK to enter “the highly political arena of the climate change debate” provided your results endorse man-made warming, but not if they support Svensmark’s heresy that the Sun alters the climate by influencing the cosmic ray influx and cloud formation.

My God Steven and the likes asking for an answer to peak oil from the minister... Are you serious.. no one here has given any real evidence just theory to when or why we may or may not have achieved peak oil... If she had answered that would be a lie... She has no idea to the facts and therefore correct answer is...... no comment...

Yes Im serious...

We are looking at a future event, evidence is deduction based on the available data. Its known as planning, risk management, protecting NZs ppl, lands and economy...

Facts/data, there are enough...she is the energy minister....its quite simple the fact she wont comment on her area of expertese is the telling "its decades away" which was the old line....

Nice troll btw...



"evidence is deduction based on the available data".....

What if the data is incomplete....incorrect.....being manipulated.....deliberately misleading!

What if the deductions are a case of the end justifies the methods.

Wolly.....thats nuts frankly. So part of your investigation is to look for the possibilites of the data being manipulated or misleading.

Data is usually often has you plot "a confidence curve" that encompasses the unknowns and possible errors....

Then you can take historic data and run those through the models to get samples of the outputs, this validates the models.

Then you plan to mitigate the outcomes you dont want or wish to avoid....its known as risk mangement.

For instance,  say you are an investor....with oil at $120US a barrel jet A1 is $ airline can commercially survive for long at those the logic is, dont invest in Air line shares or bonds, little profit and in fact they wont survive, Air NZ is extension dont invest  in tourism either....

Its all out there, its all available for interpertation.  What you seem to be saying is "I want to ignore the very best information specialists can provide in making my decisions because the decison based on that info is not acceptable to me"....

Going down that path is frankly is stupid IMHO and it will hurt.




Saul Alinsky's rules.  Look at rule # 3  :-)


It seems that Obama used Alinsky's rules to great effect during the last election.

Yeah right....more like the radical is you actually....


German Military, a full english translation of their Peak Oil Document, pdf from here,

"Gaining an illustrative picture of a subject is very much a matter of habit. When considering the consequences of peak oil, no everyday experiences and only few historical parallels are at hand. It is therefore difficult to imagine how significant the effects of being gradually deprived of one of our civilisation’s most important energy sources will be. Psychological barriers cause indisputable facts to be blanked out and lead to almost instinctively refusing to look into this difficult subject in detail.

Peak oil, however, is unavoidable (p. 91)."

One para for Moa and his large GM,

"Restrictions in private and goods transportation
Given that no sufficient alternatives on the basis of regenerative energy sources have been
established for transportation, peak oil is likely to cause a substantial rise in costs and
possibly huge restrictions in motorised private transportation. This would have immediate
effects on the functional mechanisms and ways of life of modern industrialised societies.
Sudden shortages could be eased with the use of regulatory or voluntary measures ("mobility
vouchers", "car-free Sunday" etc.). However, suburban settlement structures in industrialised
countries in particular (living in the suburb - working in the city centre) hamper a rapid
transformation of private transportation.133 If the restrictions are considerable, all economic
sectors concerned – from the automobile industry through the construction business to
tourism – would experience a downturn. The "mobility crisis" could turn into an important
new aspect of the economic crisis."



Well done for linking this one Steven, I was about to mention it as well.  Military organisations around the world seem far more prepared to address the peak oil issue than politicians.

The German report is thorough and the conclusions from page 57 onward make for sobering reading.

 Increasing oil prices would reduce consumption and economic output. This would lead to recessions.  

  • In the short term, the global economy would respond proportionally to the decline in oil supply.

Think the run up in oil prices leading up to the GFC.

  • The increase in transportation costs would cause the prices of all traded goods to rise. Trade volumes would decrease. For some actors, this would only mean losing sources of income, whereas others would no longer be able to afford essential food products.

And did the MENA uprisings have anything to do with food price inflation?

  •  National budgets would be under extreme pressure. Expenditure for securing food supplies (increasing food import costs) or social spending (increasing unemployment rate) would compete with the necessary investments in oil substitutes and green tech.

Unemployment rates in the US now?

  • Revenues would decrease considerably as a result of recession and necessary tax reductions.

We being told  that our deficit is in part due to reduced tax receipts?

The medium and long term projections are far worse.

New Zealand is in a good position to maintain a reasonable standard of living for some time because so much of our electricity comes from renewables and we have more than enough land to feed ourselves even with reduced energy inputs however we are very vulnerable on the transport front.  We need to be preparing for transport problems and not by building more roads.


Then there is the JET report from the US military....which tends to vote republican....can hardly be accused of being leftie nambie pambies.



Though we only have 79% from renewables, dropping 21% is a big ask.....huge challenge....and the Govn is daying 90% by only 10 years too late and 10% too low...

like duh.

But of course the real problem is transport fuels and not electricity.


Though we only have 79% from renewables, dropping 21% is a big ask.....huge challenge....and the Govn is daying 90% by only 10 years too late and 10% too low...

like duh.

But of course the real problem is transport fuels and not electricity.



Forbes on peak oil.

I did post this on 90@9 but more on topic here.

The decline rate is the big unknown and the big worry.

"Collectively, the drop amounted to 12% of total liquids volumes, or 1.2 million bpd. Their average output for the quarter totalled, 14.67 million bpd. Even excluding the effect of Libya’s issues, the decline was 8%."

So 8% to grow globally 4% per annum we need 2.5% more we have 8% less energy....if that works in reverse thats a nasty outcome.


Okay so we are not yet the third world but this article on East Timor is interesting all the same:

The Minister said " That could increase to $12.7 billion with future discoveries, which would help pay for schools, hospitals, broadband and roads."

The Asia Times article notes :

 When oil was discovered in their territory, it was their expectation that oil exports would help to boost their domestic economy through creating jobs, improving human resources, developing the non-oil economy, building infrastructure, and funding other social services. But this has rarely come to pass.





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