Hipkins ChrisCROWN MINERALS AMENDMENT BILLFirst ReadingHon CHRIS HIPKINS (Leader of the House) on behalf of the Minister of Energy and Resources: I move That the Crown Minerals Amendment Bill be now read a first time. I nominate the Economic Development Science and Innovation Committee to consider the bill.This will be one of the less controversial things that this Parliament deals with when it comes to Crown minerals over the coming months. It is a largely technical bill that makes amendments to ensure that the existing Crown minerals arrangements operate effectively. The bill will amend the Crown Minerals Act 1991. The Crown Minerals Act itself provides for the efficient allocation of rights to prospect for explore for and mine Crown minerals and the effective management and regulation of those rights. It also provides for carrying out of activities in respect of those rights and a fair financial return to the Crown in exchange for the minerals.The amendments to the Act will clarify and update statutory provisions and address gaps inconsistencies and errors within the Act to give effect to the Act's purpose that I have just mentioned. This Government is committed to ensuring that the regulatory system that manages New Zealand's Crown minerals and permitting regime and that underpins those sectors is fit and robust. The changes to the bill will ensure that the regulatory gaps that currently have been identified are closed. It will ensure that there's clarity for regulators and for the industry around permitting and inconsistencies in the Crown Minerals Act will be addressed.The bill makes these changes so that the permitting regime for New Zealand Crown - owned minerals can remain up to date effective and efficient and there are three main measures that this bill puts in place: first closing the gaps; providing clarity; and addressing inconsistencies. I'll talk through each of those three in turn.The first is to close the gaps in the legislation that currently mean the Act would be used in a way that is not currently intended. The nature of the petroleum industry is changing and as such the pressures on this part of the Act are also changing. There's been an increasing amount of acquisition and divestment activity in the sector. These transactions reflect a global trend of consolidation and rationalisation by large companies. Smaller more agile companies are buying up mature older oil and gas fields from larger companies with the intention of extending the life of the fields using specialist expertise. It's important to utilise the life of current infrastructure to maximise the production of existing reserves. As the Prime Minister has said there are existing permits that stretch decades into the future and it's important that we make the best possible use of these. It's also important that the Crown retains appropriate oversight of the acquisition and divestment activity in the petroleum sector. This is important in order to manage the risk that changes within the sector may bring. Under the Act any change of permit operator requires the consent of the Minister of Energy and Resources or a delegated authority. A change of permit operator occurs when the day-to-day management of a permit changes from one permit operator to another. Unlike a change of permit operator a change to the control of the permit operator does not require ministerial consent. The change of control of permit operator occurs when the majority of voting rights for a corporate body are transferred. This is not in line with the intent of the Crown Minerals Act as it allows companies to transfer operator responsibilities with reduced Crown oversight. The bill closes a gap in the legislation which would otherwise allow for a change in the control of a permit operator to take place without requiring the consent of the appropriate Minister. The amendment ensures that the Minister of Energy and Resources has oversight of appropriate transactions in the sector. It also ensures that the Minister must be satisfied that a change of control of operator will not affect the permit holder's ability to comply with an agreed work programme.The second area which the bill addresses is around clarity. The bill provides clarity around the clauses in the Act which could be interpreted in multiple different ways or where the meaning of the clause is currently unclear. In order for regulators to effectively regulate the activities of permit holders and for industry to work within the regulatory system that is set out the regulatory system has to be clear and easy to follow. Legislation that is unclear may lead to confusion and unnecessary administrative burden for those regulating petroleum and mineral sectors and for the sectors themselves. For example the bill clarifies that a permit holder must have an access arrangement to undertake minimum impact activities on schedule 4 land. Clarification such as this will ensure New Zealand's regulatory system works effectively for both regulators and for the industry. A clear regulatory system will also provide a stable base for Government and industry to work together in a cohesive manner.Finally the bill deals with issues around inconsistencies. Where the wording of a clause is inconsistent with another Act or where it is inconsistent with the purpose of the clause inconsistencies can create unnecessary administrative burden for those reliant on the regulatory framework and decrease the efficiency of the system.The bill will ensure the regulatory regime that governs our Crown minerals is fit for purpose. The bill will close gaps clarify unclear provisions and address inconsistencies currently in the Crown minerals regime. This'll ensure we have a regulatory system that remains effective and efficient while at the same time providing clear and transparent expectations to industry. Our goal is to have mineral and petroleum industries that are responsibly delivering value to New Zealand and the amendments in this bill will help us to achieve that. I commend the bill to the House.