New Zealand Reopens Oil and Gas Licensing
Sep 25, 2025
New Zealand has reopened for oil and gas exploration, ready to receive applications for exploration projects after a seven-year pause, following the lifting of a ban on such activity installed by the previous government.
The country’s government will also accelerate the project approval process in a bid to enhance New Zealand’s energy security, local media reported.
“Confidence in the gas sector took a significant hit when the exploration ban was introduced in 2018,” Resource Minister Shane Jones said, quoted by RNZ.
“This has left a gaping hole in New Zealand’s medium-term energy security, and… we need to get the sector back to work to play catch-up.”
Back in 2018, the center-left government of former Prime Minister Jacinda Ardern banned offshore oil and gas exploration to protect New Zealand from the effects of climate change and help it reach its net-zero goals.
New Zealand’s natural gas production dropped by 12.5% in 2023 and by a further 27.8% for the first three months of last year alone, creating a nationwide shortage, according to government estimates.
This has resulted in reductions in manufacturing output, while electricity generators have resorted to using more coal and diesel to power the electricity system.
The overall gas output decline for last year was 22%, and reserves of the fuel also declined, the government warned earlier this year.
The inadequate energy supply situation pushed up wholesale electricity prices in New Zealand, which has been “devastating for our manufacturing and export sectors, and is sadly leading to firms reducing production or closing entirely,” according to Energy Minister Simeon Brown.
New Zealand already has a much lower-emission energy mix than most, with the bulk of its electricity coming from hydro. Yet hydropower is vulnerable to the effects of droughts, which makes natural gas a necessary force of stability for the grid.
Oilprice.com
