New Zealand: Heavier regime for fracking? Recommendations of the Parliamentary Commissioner for the Environment

Brief Counsel

No moratorium but greater strategic oversight of the regulatory regime is recommended by the Parliamentary Commissioner for the Environment in her long-awaited final report, delivered this week.

We look at the six broad recommendations and what they might mean for industry.

Focus of report

The Commissioner takes the view, based on international experience and the increase in exploratory drilling activity, that the use of fracking will grow rapidly and that regulation will struggle to keep pace.

Her recommendations are designed to let the regulator "get ahead of the game" through improvements to government oversight of oil and gas production and the regional planning process.

The report is confined to onshore drilling.

Key recommendations

Recommendation one

That central government provides strategic direction to local government through the development of a National Policy Statement (NPS). This could include "straightforward" matters like requirements for monitoring, but could also direct councils to plan for how they will deal with bigger challenges like the cumulative effects on the landscape and interaction with other land uses.

An NPS would reduce inconsistencies of practice among councils, and would include the development of technical and environmental standards.

Recommendation two

That regional councils make drilling oil or gas bores, fracking and waste disposal 'discretionary' activities requiring a specific consent and covered by specific rules, particularly in relation to the cumulative effects of such drilling. These should include:

  • identified areas where oil and gas drilling is prohibited
  • core requirements for environmental monitoring
  • a requirement that applications for establishing a well site and for drilling the well be bundled together
  • explicit circumstances when consents will be publicly notified and when they will not be, and
  • identification and planning for the cumulative effects of an industry that may expand very rapidly.

Recommendation three

This concerns the issue of well integrity. The Commissioner considers that regional councils can largely rely on the High Hazards Unit (HHU) to ensure that the design, construction and operation of a well are safe as this falls within HHU's responsibility to protect workers.

But HHU's expertise is not available to ensure that the well is adequately cased when it passes through freshwater layers as this does not bear on worker safety.

The report suggests alternatives:

  • to amend the Health and Safety in Employment (Petroleum Exploration and Extraction) Regulations 2013 to direct the HHU to include the protection of the environment in assessing the design of a well, or
  • to include the protection of freshwater layers as a condition that regional councils must apply in granting consents for oil drilling and gas wells.

Recommendation four

Although the Commissioner acknowledges that the chance of an accident is low, she observes that it is not zero; that the clean-up costs can be significant; and that issues of who should pay can arise when consents have been surrendered and a well has been abandoned.

She recommends:

  • that the adequacy of the public liability insurance held by companies bidding for exploration permits be assessed by New Zealand Petroleum and Minerals as part of "credit checking", and
  • an annual levy on industry participants to cover the cost of monitoring abandoned wells and remediating any future leaks, similar to the Alberta and Saskatchewan regimes.

Recommendation five

Regional councils are legally able to enforce the controls under the Hazardous Substances and New Organisms Act (HSNO) when they are visiting well sites but they are not legally obliged to do so.

The report recommends that council enforcement of HSNO standards be made mandatory.

Recommendation six

The Commissioner considers that more information is needed around solid waste disposal and has recommended that the Minister for Food Safety and the Minister for the Environment convene a working group, including regional council officers and agricultural representatives, to:

  • resolve when livestock can be put back on to 'land-farmed' pasture in Taranaki, and
  • consider how solid waste from the East Coast Basin should be disposed of before the number of wells begins to proliferate.

Chapman Tripp comments

A framework to promote more consistency of practice between the regions, while also recognising local circumstances, would provide welcome certainty to operators. The challenge is to get a regime which meets its regulatory objectives – in this case, environmental protection – without incurring unnecessary compliance and administrative costs.

In this context, we question whether a full discretionary activity consent should be required for all applications as there are a number of 'run of the mill' activities, the effects of which are well-understood and could be managed via the imposition of standard conditions.

The Commissioner's report now sits with the government. Environment Minister Amy Adams and Energy and Resources Minister Simon Bridges have said they will consider the recommendations but have provided no timeframe for that consideration.

Chapman Tripp's commentary on the interim report is available here.

Thanks to Karen Kemp and Shayne Misselbrook for writing this article.

The information in this article is for informative purposes only and should not be relied on as legal advice. Please contact Chapman Tripp for advice tailored to your situation.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions