Crown Minerals Act Law Changes

Crown Minerals Act 1991 – New Zealand Legislation

These changes are detailed in the Crown Minerals Amendment Bill 2024 and form part of a wider minerals plan designed to meet New Zealand’s energy security challenges and to promote economic opportunities.

To achieve these, changes have been proposed through the Crown Minerals Amendment Bill 2024.

Crown Minerals Amendment Bill 2024 – New Zealand Legislation

Proposed changes to the Crown Minerals Act 1991

The proposed changes to the Crown Minerals Act 1991 are:

• Reverse the 2018 ban on new petroleum exploration outside onshore Taranaki. 
• Remove the 2018 restriction preventing new petroleum permit holders from accessing some Taranaki conservation land for petroleum activities, other than minimum impact activities. Minimum impact activities include things like surveying and taking samples by hand-held or low-impact mechanical methods. This will ensure that conservation land across New Zealand is treated consistently. Conservation land protected by Schedule 4 of the CMA, including Mount Taranaki, will retain existing protections.  
• Change how petroleum exploration permits are allocated. Permits are currently allocated through a competitive tender process, called Block Offer. The Bill proposes allowing for alternative methods of allocating permits in the most efficient and effective way to match investor interest.
  How the other methods will interact with Block Offers will be designed through a review of the Minerals Programme. Iwi and hapū will still be consulted as they are as part of the current Block Offer process. Consultation on non-tender applications will still occur on an individual basis, similar to minerals permit applications.  
• Change the petroleum decommissioning requirements to align with international best practice, and better balance regulatory burden and risk. This will involve:
  • Making technical changes to financial securities requirements, the primary tool to manage the risk of a permit holder failing to carry out or fund decommissioning. These changes will make financial securities more flexible, allowing industry to set aside this money in a way that is cost efficient and best suits their circumstances.
  • Changes to trailing liability. Currently, if a current permit holder fails to carry out or fund decommissioning, the liability for the cost of decommissioning can flow ‘up the chain’ to former permit holders. The Government is proposing to limit this liability to the party who most recently transferred their interest, therefore providing greater certainty to previous permit holders.
  • Introducing perpetual liability for permit holders who undertake decommissioning if something goes wrong after they have plugged and abandoned a well or left infrastructure on site. This anticipates future risks that are difficult to quantify and is a change from the current requirement for permit holders to provide a payment, or financial security.
• Reintroduce the term “promote” into the purpose statement of the Act. The purpose of the Crown Minerals Act 1991 is currently to “manage” prospecting, exploration and mining of minerals. The Minister’s functions under the Act are to “from time to time offer permits for application by public tender”. The Government is proposing a change to replace “manage” with “promote” and replace the Minister’s functions with “attract permit applications”, reversing a change made to the Act in 2023.
  Reverting to the previous purpose statement and associated Minister’s functions is intended to signal that the Government wants to increase petroleum exploration and production in recognition of the important role gas will play as a transition fuel to clean energy.
• Introduce a new tier of mineral permitting (Tier 3). This will reduce the regulatory burden on hobby or recreational gold mining operations, with different application processes and reporting requirements. 
• Introduce a mechanism for a Government Policy Statement. A Statement, if issued, would be an important signalling tool that sets out the minerals priorities and focus areas for a particular Government.
• Extend the data confidentiality period for existing prospecting datasets. Before the ban on new petroleum exploration outside onshore Taranaki was introduced, some speculative prospectors collected offshore seismic data. Under the Crown Minerals Act 1991, these prospectors are entitled to a 15-year confidentiality period during which they can sell that data to interested explorers and in turn promote investment into New Zealand. The 2018 ban removed demand for this data as New Zealand was no longer issuing offshore exploration permits. The Government is proposing to extend the 15-year confidentiality period for datasets affected during this period. 

What happens now?

The Bill with the proposed changes to the Crown Minerals Act 1991 is now at Select Committee.

Economic Development, Science and Innovation Select Committee – New Zealand Parliament

Select committee FAQs – New Zealand Parliament

If passed, the Bill (excluding the introduction of Tier 3 provisions) is expected to come into force immediately. Tier 3 provisions are expected to come into force in July 2025.

New Zealand Petroleum and Minerals (NZP&M) is the regulator of the Crown Minerals Act 1991, overseeing New Zealand's petroleum and minerals industry.

Past amendments to the Crown Minerals Act 1991