Luxon hands open cheque to oil companies

22 July: 350 Aotearoa is revealing the coalition government is removing oil decommissioning safeguards, risking more $500m bills for the taxpayer. In the minutes from a cabinet paper, the government has agreed to ‘remove the requirement to pay an amount and/or provide financial security for any decommissioning liabilities’. Without these financial securities, the government is at a higher risk of having to pay hundreds of millions of dollars to decommission - or plug - a failed oil well. The decision comes as the taxpayer has recently been stuck with a $443 bill to decommission the Tui oil field. 

350 Aotearoa campaigner Adam Currie says ‘Financial securities are effective, as they make permit and license holders set funds aside or enter into other types of security while they are financially strong - not only at the point the regulator has concerns about the permit or license holder’s financial capability to fund decommissioning - as by then it is usually too late. The removal of the key financial security safeguard dramatically increases the risk of the taxpayer having to yet again pay to decommission a failed oil field. This is no hypothetical - decommissioning the Tui oil field has already cost the government $443 million, according to Minister Jones' own figures in this cabinet paper. Luxon’s decision hands an open cheque to fossil fuel companies, at a time when New Zealand should be making big polluters pay for the environmental damage they are causing.’

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