Genter Julie AnneMARITIME TRANSPORT (OFFSHORE INSTALLATIONS) AMENDMENT BILLFirst ReadingHon JULIE ANNE GENTER (Associate Minister of Transport): I move That the Maritime Transport (Offshore Installations) Amendment Bill be now read a first time. I nominate the Transport and Infrastructure Committee to consider the bill. At the appropriate time I intend to move that the bill be reported to the House by 29 October 2019 and that the committee have the authority to meet at any time while the House is sitting except during oral questions and during any evening on a day on which there has been a sitting of the House and on a Friday in a week in which there has been a sitting of the House and to meet outside the Wellington area during a sitting of the House despite Standing Orders 181 193 194(1)(b) and (c). This bill seeks to clarify and strengthen requirements on owners of offshore oil and gas installations to support increased levels of insurance or other financial assurance for their liabilities in the event of pollution resulting from an oil spill. Although the likelihood of a major marine spill is low the environmental financial and cultural impacts of such an incident would be significant. Protecting our environment is hugely important for our nation and safeguards our economy and our future. As a nation we've built our economy and reputation on our natural capital; tourism and agriculture are two of our biggest export earners as a result. New Zealand's natural capital is of enormous value—immeasurable I would argue. Our forests our fresh water our soil our birdlife our enormous marine area our fish stocks our atmosphere and our biodiversity—these are taonga which have underpinned our way of life and our standard of living. However these taonga cannot be taken for granted and must be protected for generations to come. The level of financial assurance required for owners of offshore oil and gas installations needs to better reflect the real-world cost of implementing clean-up measures in the event of an oil spill in our waters. To enable this the bill amends the Maritime Transport Act 1994. Amongst other things its purpose is to clarify the requirements on owners of offshore oil and gas installations to hold insurance or other financial security in relation to their liability for clean-up and compensation resulting from an oil spill. The Maritime Transport Act implements a polluter pays" regime under which owners have unlimited liability for the cost of pollution damage resulting from a spill at their facilities in New Zealand waters. This means that anyone affected by oil damage from an offshore installation is entitled to make a claim against the owner. The owner's liability includes the cost of measures to prevent or reduce pollution damage the cost of reasonable measures to reinstate the environment and the loss of profit from impairment to the environment. The bill I'm speaking to today does not change the owner's liability. Instead it strengthens and clarifies the requirement for insurance and other financial security that owners must hold. The Act provides for owners to hold insurance or other financial security in respect of their liability. The insurance or other financial security is intended to mitigate the financial risk to the Crown and other parties should the owner be unable to meet their liabilities in the event of a significant oil spill. Detailed requirements for the insurance or other financial security are specified in marine protection rules made under the Act. The bill amends the Act to provide certainty in relation to the liability of insurers or in the case of financial security to the persons providing financial security to the Crown and to other third parties who are affected by the pollution. The bill also clarifies that rules may specify the types of liability that will need to be insured against and may provide for the insurance or other financial security to cover the cost of well control measures and other costs of implementing marine oil spill contingency plans. The amendments to the Act will be supported by amendments to the relevant rules which will specify the detailed requirements relating to the insurance or financial security. The rules will include a scaled framework for specifying the amount of cover required based on the modelling of a credible worst-case scenario event from that particular installation. Maritime New Zealand will also issue guidance for applicants to help them to navigate the regime. I have publicly released working drafts of the guidance and marine protection rules that are proposed to be put in place following the passage of the bill. I have done this so that the public and stakeholders are able to understand how the new regime will work as a package. It will also ensure that the new regime is able to be implemented as soon as practicable if the bill is passed into law. These changes are intended to enable owners of regulated offshore installations to meet the Act's requirement using insurance policies that are consistent with internationally available best-practice policy wording and are available on the international market. These policies will be required to cover the key risks and costs of clean-up and pollution damage associated with the owner's installation. I'd just like to thank all of the officials who've been working behind the scenes for quite some time to bring this bill and the associated rules before the House. I commend this bill to the House."