www.epa.govt.nz
Application Ref:EEZ000007
DECISION ON MARINE CONSENT APPLICATION
OMV New Zealand Limited
Development drilling at the Maari Field in the Taranaki Bight
EXCLUSIVE ECONOMIC ZONE AND CONTINENTAL SHELF (ENVIRONMENTAL EFFECTS) ACT 2012
Maari Development Drilling – OMV New Zealand Limited
Marine Consent Decision
Application OMV New Zealand Limited has applied for a marine consent to complete the existing
programme of development drilling in the Maari field in the Petroleum Mining Permit (PMP
38160). The application seeks a marine consent for the following activities:
The construction, placement, alteration, extension, removal, or demolition of a structure on or
under the seabed (section 20(2)(a)):
The removal of the jack-up drilling rig legs from the seabed; and
The alteration of the equipment on the wellhead platform.
The construction, placement, alteration, extension, removal, or demolition of a submarine
pipeline on or under the seabed (section 20(2)(b)):
The installation of submarine pipelines (production tubing, casing and associated fittings)
under the seabed.
The removal of non-living natural material from the seabed or subsoil (section 20(2)(d)):
The drilling of the wells involving the removal of material from the subsoil.
The disturbance of the seabed or subsoil in a manner that is likely to have an adverse effect
on the seabed or subsoil (section 20(2)(e)):
The removal of the jack-up drilling rig legs from the seabed.
The deposit of any thing or organism in, on, or under the seabed (section 20(2)(f)):
The deposition of drill cuttings and other materials on and under the seabed; and
The deposition of settling sediment from the plume generated from the removal of the
jack-up drilling legs.
The destruction, damage, or disturbance of the seabed or subsoil in a manner that is likely to
have an adverse effect on marine species or their habitat (section 20(2)(g)):
The removal of the jack-up drilling rig legs from the seabed.
The construction, mooring or anchoring long-term, placement, alteration, extension, removal,
or demolition of a structure or part of a structure in the waters of the EEZ (section 20(4)(a)):
The removal of the jack-up drilling rig legs from the seabed.
The causing of vibrations (other than vibrations caused by the normal operation of a ship) in
a manner that is likely to have an adverse effect on marine life in the waters of the EEZ
(section 20(4)(b)):
The generation of vibrations from drilling the wells.
Decision
Pursuant to section 62(1)(a) of the Exclusive Economic Zone and Continental Shelf (Environmental Effects)
Act 2012, the application for marine consent by OMV New Zealand Limited to complete the existing
programme of development drilling activities at the Maari wellhead platform in the South Taranaki Bight is
GRANTED subject to conditions.
The reasons for granting the marine consent, along with the conditions applying to its exercise, are set out
below in this decision pursuant to section 69 of the Exclusive Economic Zone and Continental Shelf
(Environmental Effects) Act 2012.
1. OMV New Zealand Limited (OMV) has applied for marine consent under the Exclusive Economic
Zone and Continental Shelf (Environmental Effects) Act 2012 (EEZ Act) for various activities
associated with the drilling of up to seven development wells in order to enhance petroleum
production at the existing Maari oil field in the South Taranaki Bight. The Maari wellhead platform
(WHP) is located approximately 80 kilometres (km) offshore from Opunake at 39.985833°S and
173.293836°E.
2. OMV submitted an Impact Assessment for the drilling of the seven development wells to the
Environmental Protection Authority (EPA) in June 2013 – a “planned petroleum activity” under
section 166 of the EEZ Act. Section 166 is a transitional provision of the Act that allowed OMV to
commence its drilling programme without a marine consent and continue until 28 June 2014.
3. The drilling programme was not able to be completed before 28 June 2014. As such, OMV lodged an
application for marine consent to authorise the continuation of their drilling programme on 3 June
2014, enabling OMV to continue with its drilling programme whilst its application for marine consent
is considered by the EPA.
4. The application for marine consent covers the drilling of up to seven development wells and
associated activities. The wells will be drilled within existing conductor slots, using the jack-up drilling
rig ENSCO 107. The purpose of the drilling programme is to enhance petroleum production at the
Maari oil field.
5. In making our decision on this application for marine consent, we have acted as an independent
decision-maker under delegated authority from the EPA.
6. Our decision is to grant the application for marine consent. The reasons for this decision are
summarised below and fully set out in the main body of this report.
7. In making our decision, we have taken into account the decision-making criteria set out in sections
59 and 60 of the EEZ Act. We have also applied the information principles set out in section 61 of the
EEZ Act.
8. We have also determined the extent to which imposing conditions under section 63 of the EEZ Act
might avoid, remedy or mitigate the adverse effects on the environment and existing interests. The
conditions we have decided to impose are detailed in Appendix 1 to this decision.
9. We have considered a wide range of actual and potential effects on the environment of this
application. It is not an application for consent for the recovery and production of oil or gas.
Submitters expressed concerns at potential effects arising from production activities at the Maari field
but we have confined our consideration to effects that arise from the development drilling
programme.
10. The overall effect of the development drilling programme on the environment is minor and, in many
cases, the effects are temporary. Nonetheless, we are conscious of our responsibility to take account
of events of low probability but high potential impact. An oil spill is such an event. This was the focus
of many submissions. The EEZ Act does not require no risk before an activity can be consented and
we considered whether there is a robust regime in place to prevent such spills and to manage them
should they occur. The information we obtained from Maritime New Zealand and OMV satisfies us
that this is the case.
11. Submitters expressed concerns that related to the recovery, production and use of oil and other
fossil fuels to generate energy and the impact of that on climate change across the world. One
submitter commented in an oral presentation that climate change was “the elephant in the room”.
Whatever the merits of that observation, we cannot consider climate change when we assess the
effects of this application. The EEZ Act specifically excludes climate change from those matters we
may take into account.
12. The EEZ Act is part of an overall regulatory regime, spread across various legislation, which
manages activities in the exclusive economic zone and in or on the continental shelf.
13. The purpose of the EEZ Act is set out in sections 10(1) and 10(2):
“10(1) The purpose of this Act is to promote the sustainable management of the natural resources of
the exclusive economic zone and the continental shelf.
10(2) In this Act, sustainable management means managing the use, development, and protection
of natural resources in a way, or at a rate, that enables people to provide for their economic
well-being while—
(a) sustaining the potential of natural resources (excluding minerals) to meet the reasonably
foreseeable needs of future generations; and
(b) safeguarding the life-supporting capacity of the environment; and
(c) avoiding, remedying, or mitigating any adverse effects of activities on the environment.”
14. Our assessment of the effects of the proposal is that there is no reason to refuse the application for
the development drilling programme and that granting marine consent for this activity meets the
purpose of the Act.
Dated this 15th day of December, 2014.
_________________________ ___________________________
Alick Shaw Sharon McGarry
Chair Deputy Chair
_________________________ ___________________________
Kura Denness Te Taru White
EPA Board Member DMC Member
_________________________
Dr Donald Robertson
DMC Member
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Table of Contents
Introduction/Background ........................................................................................................... 1 1.
1.1 The Decision-making Committee ........................................................................................ 1
1.2 The Applicant and the Application....................................................................................... 1
1.2.1 The Applicant ......................................................................................................... 1
1.2.2 The Application ...................................................................................................... 1
1.2.3 Activities Subject to Approval ................................................................................. 3
1.2.4 Other Activities Associated with the Application .................................................... 5
1.3 Procedural History ............................................................................................................... 8
1.3.1 Timeline .................................................................................................................. 8
1.3.2 Requests for Information ........................................................................................ 8
1.3.3 EPA Staff Report .................................................................................................... 9
1.4 Context of Application ....................................................................................................... 10
1.4.1 Transitional Provisions ......................................................................................... 10
1.5 Submissions ...................................................................................................................... 10
1.6 The Decision-making Process .......................................................................................... 11
Description of the Existing Environment and Existing Interests ......................................... 12 2.
2.1 Physical Environment ........................................................................................................ 12
2.1.1 Geological Setting ................................................................................................ 12
2.1.2 Oceanography ...................................................................................................... 12
2.2 Biological Environment ...................................................................................................... 14
2.2.1 Benthic Ecosystems ............................................................................................. 14
2.2.2 Plankton and Primary Productivity ....................................................................... 14
2.2.3 Fish Species ......................................................................................................... 14
2.2.4 Marine Mammals .................................................................................................. 15
2.2.5 Seabirds ............................................................................................................... 16
2.2.6 Marine Reptiles and Corals .................................................................................. 16
2.2.7 Sites of Conservation Significance ...................................................................... 16
2.3 Existing Interests ............................................................................................................... 17
2.3.1 Iwi Interests .......................................................................................................... 17
2.3.2 Fishing Interests ................................................................................................... 17
2.3.3 Commercial Shipping Interests ............................................................................ 17
Statutory Framework ................................................................................................................ 18 3.
3.1 Introduction ........................................................................................................................ 18
3.2 Purpose and Principles of the EEZ Act ............................................................................. 18
3.2.1 Purpose ................................................................................................................ 18
3.2.2 International Obligations ...................................................................................... 19
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3.2.3 Te Tiriti o Waitangi – Treaty of Waitangi .............................................................. 20
3.3 Section 20 – Restrictions on Activities in Exclusive Economic Zone and Continental Shelf20
3.4 Decision-making Criteria ................................................................................................... 20
3.5 Information Principles ........................................................................................................ 23
3.5.1 Full Use of Powers ............................................................................................... 23
3.5.2 Best Available Information ................................................................................... 24
Context for Consideration and Evaluation ............................................................................. 26 4.
Potential Effects on the Environment and Existing Interests ............................................... 27 5.
5.1 Introduction ........................................................................................................................ 27
5.2 Macro-benthic Communities ............................................................................................. 28
5.2.1 The Issues ............................................................................................................ 28
5.2.2 The Effects ........................................................................................................... 28
5.2.3 Findings ................................................................................................................ 30
5.2.4 Conditions ............................................................................................................ 31
5.3 Planktonic Communities .................................................................................................... 31
5.3.1 The Issues ............................................................................................................ 31
5.3.2 The Effects ........................................................................................................... 31
5.3.3 Findings ................................................................................................................ 33
5.3.4 Conditions ............................................................................................................ 33
5.4 Marine Mammals ............................................................................................................... 34
5.4.1 The Issues ............................................................................................................ 34
5.4.2 The Effects ........................................................................................................... 34
5.4.3 Findings ................................................................................................................ 37
5.4.4 Conditions ............................................................................................................ 38
5.5 Seabirds ............................................................................................................................ 38
5.5.1 The Issues ............................................................................................................ 38
5.5.2 The Effects ........................................................................................................... 39
5.5.3 Findings ................................................................................................................ 39
5.5.4 Conditions ............................................................................................................ 39
5.6 Fish .................................................................................................................................... 40
5.6.1 The Issues ............................................................................................................ 40
5.6.2 The Effects ........................................................................................................... 40
5.6.3 Findings ................................................................................................................ 40
5.6.4 Conditions ............................................................................................................ 41
5.7 Biosecurity ......................................................................................................................... 41
5.7.1 The Issues ............................................................................................................ 41
5.7.2 The Effects ........................................................................................................... 41
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5.7.3 Findings ................................................................................................................ 42
5.7.4 Conditions ............................................................................................................ 42
5.8 Existing Interests ............................................................................................................... 42
5.8.1 The Issues ............................................................................................................ 42
5.8.2 The Effects ........................................................................................................... 42
5.8.3 Findings ................................................................................................................ 45
5.8.4 Conditions ............................................................................................................ 46
5.9 Oil Spills ............................................................................................................................ 46
5.9.1 The Issues ............................................................................................................ 46
5.9.2 The Effects ........................................................................................................... 48
5.9.3 Findings ................................................................................................................ 51
5.9.4 Conditions ............................................................................................................ 52
Effects on Human Health .......................................................................................................... 53 6.
6.1 The Issues ......................................................................................................................... 53
6.2 The Effects ........................................................................................................................ 53
6.2.1 Drill Cuttings and Muds ........................................................................................ 53
6.2.2 Algae Blooms ....................................................................................................... 53
6.3 Findings ............................................................................................................................. 54
6.4 Conditions ......................................................................................................................... 54
The Protection of Biological Diversity and Integrity of Marine Species, Ecosystems and 7.
Processes ................................................................................................................................... 55
The Protection of Rare and Vulnerable Ecosystems and Habitats of Threatened Species56 8.
The Economic Benefit to New Zealand ................................................................................... 57 9.
The Efficient Use and Development of Natural Resources ................................................... 59 10.
The Nature and Effect of Other Marine Management Regimes ............................................ 60 11.
Best Practice .............................................................................................................................. 61 12.
Conditions .................................................................................................................................. 62 13.
Relevant Regulations and Other Applicable Law .................................................................. 65 14.
14.1 Relevant Regulations ........................................................................................................ 65
14.2 Other Applicable Law ........................................................................................................ 65
Other Relevant Matters ............................................................................................................. 66 15.
15.1 Value of Investment .......................................................................................................... 66
15.2 Hydraulic Fracturing/Water Injection ................................................................................. 66
15.3 Precautionary Approach .................................................................................................... 66
15.4 New Technology ............................................................................................................... 67
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Adaptive Management .............................................................................................................. 68 16.
APPENDIX 1: MARINE CONSENT CONDITIONS .............................................................................. 69
APPENDIX 2: ABBREVIATIONS AND ACRONYMS USED IN THIS DECISION ............................... 77
APPENDIX 3: PROCEDURAL HISTORY ............................................................................................. 78
APPENDIX 4: SUMMARY OF SUBMISSIONS .................................................................................... 79
1
Introduction/Background 1.
1.1 The Decision-making Committee
1. The Environmental Protection Authority (EPA) is the consent authority for certain activities that are
restricted within New Zealand’s exclusive economic zone (EEZ) and in or on the continental shelf.
One of the EPA’s functions, pursuant to section 13(1) of the Exclusive Economic Zone and
Continental Shelf (Environmental Effects) Act 2012 (EEZ Act), is to decide applications for marine
consent.
2. On 5 July 2014, the EPA Board appointed a Decision-making Committee (DMC) to exercise powers
and functions under the EEZ Act related to the application for marine consent lodged by OMV New
Zealand Limited (OMV). The EPA Board also delegated all of the functions and powers of the EPA
related to the processing, hearing and deciding of the application under the EEZ Act to the DMC.
This DMC comprises Mr Alick Shaw (Chair), Ms Sharon McGarry (Deputy Chair), Ms Kura Denness
(EPA Board Member), Dr Donald Robertson and Mr Te Taru White. This is our written decision
pursuant to the provisions of the EEZ Act.
3. In considering and deciding the application for marine consent by OMV, we have exercised
independent judgement within the statutory framework for determining applications for marine
consent under the EEZ Act.
1.2 The Applicant and the Application
1.2.1 The Applicant
4. OMV New Zealand Limited (OMV) is a privately owned company that has been operating in New
Zealand since 1999.1 OMV operates the Maari and Manaia oil fields in the South Taranaki Bight with
three joint venture parties – Todd Maari Limited, Horizon Oil International Limited and Cue Taranaki
Pty Limited.
1.2.2 The Application
5. OMV has applied for marine consent to complete its drilling programme and seeks a term of consent
of two years.
6. Mr Frank Barker2 explained that the drilling programme will involve up to seven wells being drilled
from within existing conductor slots to oil reservoirs approximately 1,000–2,500 metres (m) deep and
that all will be side-tracked to drill horizontally to hydrocarbon reservoirs up to 8 kilometres (km)
away. Six of these wells will be for extracting hydrocarbons, while one will be a water injection well.
1 Mr Peter Zeilinger, Managing Director of OMV New Zealand Limited. 2 Drilling Manager for OMV New Zealand Limited.
2
7. The wells will be drilled by the ENSCO 107 jack-up drilling rig positioned alongside the existing Maari
wellhead platform (WHP). During the drilling programme, the ENSCO 107 is cantilevered over the
WHP.
8. Dr Karl-Heinz Zelt3 explained that the oil extraction process requires the oil to be heated and
pumped. Electrical submersible pumps are installed in the wells approximately 1,000 m below sea
level. The injection of seawater is also used to assist in recovering oil – this activity is not subject to
this application for marine consent.
9. Two of the new development wells will be drilled through conductor slots that were installed in April
2014. The remaining five will be side-tracked from existing conductor slots or wells. Mr Barker
explained that side-tracking involves plugging the lower portion of the wells with cement. The metal
casing and cement sheath is then milled out on the side of the upper portion of the wells and
horizontal wells are drilled to target reservoirs.
10. Drilling muds are continuously pumped down the drill pipe during the drilling process and are
pumped back up with the drill cuttings to the ENSCO 107, which is positioned over the WHP. Drill
cuttings are then removed from the muds, cleaned in separators and recirculated until they are no
longer needed. The drill cuttings are then deposited onto the seabed (via a discharge pipe 10 m
below the sea surface) or shipped for land-based disposal.
11. The Impact Assessment stated that drill cuttings, drilling muds, milling swarf and cement slurry will
be deposited on and under the seabed under the marine consent sought. It noted that the discharge
of drilling muds and cuttings into the water column is authorised under the Discharge Management
Plan (DMP) approved by Maritime New Zealand (MNZ) under Marine Protection Rule 200 of the
Marine Transport Act 1994.
12. Drill cuttings are discharged and deposited on a daily basis. The Impact Assessment stated that
approximately 3,000 cubic metres (m3) of drill cuttings were expected from seven wells. In their
closing submissions OMV stated that the upper limit of material removed from the subsoil as cuttings
is 3,500 m3, as measured by the length and width of the seven wells. The Impact Assessment stated
discharge particle size ranges from 0.007 to 7 millimetres (mm), with 80% of cuttings expected to be
less than 1 mm.
13. The Impact Assessment stated that approximately 40% of the drill cuttings produced by the drilling
programme will be produced using synthetic-based muds (SBMs), with the balance using water-
based muds (WBMs). WBMs with an oil-in-water content of less than 100 parts per million (ppm) will
be discharged into the sea, while SBMs will be shipped for land-based disposal. However, drill
cuttings that have been produced using SBMs that have a residual oil content of less than 4.9%
(average per well) will also be discharged into the sea. Drill cuttings with residual oil content greater
than 4.9% are shipped for land-based disposal.
3 Petroleum Engineering Manager for OMV New Zealand Limited.
3
14. Mr Barker stated that, at the end of drilling each well, WBMs are discharged into the sea at an
approximate hourly rate of 25 m³ and are discharged over periods of 12 to 24 hours. At the end of
drilling SBMs are returned to the shore for land-based disposal.
15. Mr Barker said that the bulk of milling swarf (metal shavings and chips) from side-tracking will be
returned to the ENSCO 107 and shipped for land-based disposal. However, some milling swarf will
be entrained in the discharge and deposited on the seabed.
16. As each section of a well is completed, a casing or liner is cemented into place to prevent hole
collapse and maintain well integrity. When drilling the next section of the well the base of the
cemented casing is drilled. Consequently, small amounts of cement will be in drill cuttings that are
discharged into the sea. Cement slurry is discharged when cement mixers and containers are
washed at the end of each section.
17. Mr Barker said that, by using existing conductor slots, drilling will begin approximately 107 m below
the seabed and not on the seabed surface. Drilling into the subsoil will generate noise and vibrations
in the seabed and the water column. Noise will be generated by machinery on the ENSCO 107, by
vessels, helicopter movements and the retraction of the legs of the ENSCO 107 from the seabed at
the end of the drilling programme.
18. The Impact Assessment stated that the retraction of the legs of the ENSCO 107 from the seabed
involves the rig being lowered into the sea until it floats, at which time the legs of the rig are
retracted. The ENSCO 107 has three legs that each occupy approximately 181 square metres (m²)
of the seabed and penetrate approximately 4–5 m into the subsoil.
19. The Impact Assessment noted that alterations to the WHP are also required to incorporate the new
wells into the existing production facilities at Maari. These alterations include installation of new
flowlines from the wellhead tree, extensions to the existing manifold and new producer/injection
flowlines in the wells. This work will take place on the topside of the WHP above the sea surface.
20. The Impact Assessment stated that the activities subject to this application for marine consent will
not change the character, intensity or scale of existing petroleum activities at the Maari facilities.
Under the provisions of Petroleum Mining Permit 38160, these can continue until 2027 without a
marine consent.
21. In section 8 of volume 1 of the application documentation, OMV proffered 37 conditions for the
marine consent sought, which addressed general operations, risk management, oil spill prevention
and preparedness, navigational safety, drilling operations, marine mammals and seabirds, and
monitoring.
1.2.3 Activities Subject to Approval
22. Details of the activities requiring authorisation under section 20 of the EEZ Act are set out in Table 1
below.
4
Table 1: Marine Consent Requirements
Consent Category Activities
Section 20(1) and (2)) – Exclusive Economic Zone and Continental Shelf
(a) The construction, placement, alteration,
extension, removal, or demolition of a
structure on or under the seabed.
Removal of the jack-up drilling rig legs from the
seabed.
Alteration of the equipment on the WHP.
(b) The construction, placement, alteration,
extension, removal, or demolition of a
submarine pipeline on or under the
seabed.
Installation of submarine pipelines (production
tubing, casing and associated fittings) under the
seabed.
(d) The removal of non-living natural material
from the seabed or subsoil.
Drilling of the wells involving the removal of
material from the subsoil.
(e) The disturbance of the seabed or subsoil
in a manner that is likely to have an
adverse effect on the seabed or subsoil.
Removal of the jack-up drilling rig legs from the
seabed.
(f) The deposit of any thing or organism in,
on, or under the seabed.
Deposition of drill cuttings and other materials
on and under the seabed.
Deposition of settling sediment from the plume
generated from the removal of the jack-up
drilling legs.
(g) The destruction, damage, or disturbance
of the seabed or subsoil in a manner that
is likely to have an adverse effect on
marine species or their habitat
Removal of the jack-up drilling rig legs from the
seabed.
Section 20(3) and (4) – Exclusive Economic Zone
(a) The construction, mooring or anchoring
long-term, placement, alteration,
extension, removal, or demolition of a
structure or part of a structure
Removal of the jack-up drilling rig legs from the
seabed.
(b) The causing of vibrations (other than
vibrations caused by the normal operation
of a ship) in a manner that is likely to
have an adverse effect on marine life
Generation of vibrations from drilling the wells.
5
23. The Impact Assessment stated that, under section 36 of the EEZ Act, the activities requiring marine
consent are discretionary activities because they are not specifically classified in regulations made
under the EEZ Act.
1.2.4 Other Activities Associated with the Application
24. There are a number of activities associated with the drilling programme that are not covered by way
of a marine consent under the EEZ Act, but the effects of which need to be considered as part of the
overall effects assessment under section 59(2) of the Act. These ancillary activities include:
(a) discharges from the ENSCO 107 and floating production, storage and offloading vessel
(FPSO) into the water column;
(b) vessel movements;
(c) lighting;
(d) helicopter movements; and
(e) contingency explosions within the conductor slots.
25. We note that some experts on behalf of OMV said the effects of discharges from the ENSCO 107
and FPSO into the water column do not require marine consent and should not form part of the
effects assessment. However, we consider the discharges from the ENSCO 107 and FPSO into the
water column are inextricably linked to the deposition of drill cuttings and muds onto the seabed. The
discharges into the water column authorised by the DMP form part of the existing environment and
are relevant to our assessment of cumulative effects.
26. On 16 June 2014, OMV withdrew the part of their application relating to the use of explosives or
charges within a wellbore because it would not be in the waters of the EEZ and therefore would not
fall within section 20(4)(c) of the EEZ Act. Some of the above matters are also regulated under other
marine management regimes, which are matters we must take into account in accordance with
section 59(2)(h) of the EEZ Act. The government agencies operating marine management regimes
that are relevant to this application for marine consent are presented in Table 2 below.
Table 2: Relevant Marine Management Regimes
Agency Legislation Responsibilities
The Ministry of
Business,
Innovation and
Employment
(New Zealand
Petroleum and
Minerals Branch)
The Crown
Minerals Act 1991
New Zealand Petroleum and Minerals is
responsible for managing the prospecting,
exploration and mining permit regime.
6
Agency Legislation Responsibilities
Department of
Conservation
Marine Mammals
Protection Act 1978
Wildlife Act 1953
The Department of Conservation is responsible for
protected species and marine mammals. It
prepares and administers the guidelines for
minimising disturbance to marine mammals from
seismic surveys, as well as seismic surveying
regulations in marine mammal sanctuaries. The
Department of Conservation assesses Marine
Mammal Impact Assessments, which must be
prepared by anyone proposing to undertake a
marine seismic survey.
The Department of Conservation also has
responsibility for non-mammal species, including
seabirds.
Maritime New
Zealand
Maritime Transport
Act 1994
International
Regulations for
Preventing
Collisions at Sea
1972
Maritime New Zealand is responsible for ensuring
operators have approved plans in place to manage
wastes from their activities, as well as Emergency
Response Plans if that work causes a leak or spill
into the sea. Maritime New Zealand assists the
Minister of Transport in setting marine protection
rules for managing discharges and oil spills and
maritime rules preventing the collision of vessels at
sea.
Plans developed to meet those rules include a
Discharge Management Plan (DMP), which
includes a Spill Contingency Plan, Well Control
Contingency Plan and an Environmental Monitoring
Programme. Maritime New Zealand approves all
DMPs.
For oil and gas work, the Emergency Response
Plan needs to include how the operator would stem
the flow of oil in the unlikely event of a well blowout.
Maritime New Zealand is also responsible for
maintaining New Zealand’s national oil spill
response capability and preparedness and for
coordinating any major, national-level oil spill
responses.
7
Agency Legislation Responsibilities
Ministry for Primary
Industries
Fisheries Act 1996
Biosecurity Act
1993
The Ministry for Primary Industries is responsible
for managing New Zealand’s fisheries within the
EEZ and its territorial waters, which includes
commercial, recreational and Māori customary
fisheries.
The Ministry for Primary Industries is also
responsible for biosecurity at New Zealand’s
boundaries and within the EEZ. It administers
biofouling and ballast water guidelines for vessels
entering New Zealand waters.
WorkSafe New
Zealand
Health and Safety
in Employment Act
1992
Health and Safety
in Employment
(Petroleum
Exploration and
Extraction)
Regulations 2013
WorkSafe New Zealand is responsible for
performing functions relating to safety in the
workplace.
Petroleum operators intending to drill a well are
required to have a Safety Case for the installation
that has been accepted by WorkSafe New Zealand.
A Safety Case identifies any hazards having the
potential to cause multiple fatalities of persons on
or near the installation, describes how the hazards
are or will be controlled and describes the safety
management system in place to ensure that the
controls are effectively and consistently applied.
Petroleum operators intending to drill a well must
also adhere to a well examination scheme, which
provides for the safety of wells by requiring
operators to implement arrangements for an
independent quality control check for the design,
construction, operation, maintenance, modification,
suspension and abandonment of new and existing
wells.
27. OMV requires various approvals from the government agencies that administer these marine
management regimes, but we must consider the impacts on the environment and existing interests
of activities regulated by these other regimes. Section 63 of the EEZ Act enables us to impose
appropriate conditions on the marine consent provided they do not conflict with measures required or
8
imposed under another marine management regime or the Health and Safety in Employment Act
1992.
28. We have carefully considered the need to impose conditions that largely mirror or replicate
obligations imposed under other regulatory regimes. We sought advice from legal counsel,
considered the decisions of other DMCs and thought carefully about the issues addressed by OMV
in their closing submissions and subsequent correspondence. We have not replicated conditions or
obligations imposed under other regulatory regimes unless by doing so we consider the conditions
are appropriate to avoid, remedy or mitigate any adverse effects of the proposed activities on the
environment and existing interests.
1.3 Procedural History
1.3.1 Timeline
29. OMV lodged its application for marine consent with the EPA on 3 June 2014. The procedural history
of the application is set out in detail in Appendix 3.
1.3.2 Requests for Information
30. The EPA sought further information from OMV on 30 June 2014. OMV responded to this request on
18 and 25 July 2014 and 1 August 2014.
31. The DMC sought further information from OMV on 22 August 2014. OMV responded to this request
on 10 and 17 September 2014.
32. The further information provided was published on the EPA website and addressed the following
matters:
(a) Information to validate the assessment of effects on the environment.
(b) Information on matters relevant to the assessment of the cumulative effects of the drilling
programme.
(c) The validation of noise assumptions made in the Impact Assessment.
(d) Further information on the discharge/deposition of drill cuttings and muds resulting from the
drilling programme.
(e) Information regarding the oil spill risk assumptions made in the Impact Assessment.
(f) Monitoring and mitigation proposed by OMV.
(g) Effects on existing interests and the benefits associated with the drilling programme.
(h) Other marine management regimes and their impact on the mitigation of effects.
9
33. The EPA made a further information request to OMV on 20 October 2014 on our behalf. The EPA
requested the Safety Cases approved by WorkSafe New Zealand and the DMPs approved by
Maritime New Zealand. This is discussed further in section 3 of this decision.
1.3.3 EPA Staff Report
34. The EPA commissioned a report (EPA Staff Report) for us under section 44(1)(b) of the EEZ Act. We
received this report on 5 September 2014, and it was available on the EPA website.
35. Mr Richard Johnson4 explained that the EPA Staff Report had been prepared in accordance with
sections 59, 60 and 61 of the EEZ Act. It is the work of multiple authors with relevant expertise in the
assessment and consideration of the drilling programme, including marine biology, drilling operations
and cultural matters.
36. The EPA Staff Report included consideration of the gap analysis completed by Environmental
Resources Management, the peer review by Genesis Oil and Gas Consultancy Limited and the
summary of submissions analysis prepared by Jacobs New Zealand Limited. The report by Ngā
Kaihautū Tikanga Taiao (NKTT) was not available at the time the EPA Staff Report was finalised.
37. The EPA Staff Report included a set of recommended consent conditions (based on those proffered
by OMV) for our consideration and stated “…based on the information provided to the EPA staff prior
to publishing of this report, we consider that the adverse effects can be appropriately mitigated and
that the information available is certain and adequate. Therefore, we can find no reason why the
Decision-making Committee (DMC) should not grant the application.”5 The report itself was written
before the expert evidence and submissions were available.
38. On 17 September 2014, OMV provided briefs of evidence that included revised proposed consent
conditions. These revised proposed conditions were significantly different to those proffered in the
application including the deletion of a number of conditions that OMV submitted ‘duplicated’ other
regulatory regimes. At our request, on 20 October, EPA staff provided an addendum to their Staff
Report, which provided comments on these revised proposed conditions (Addendum to EPA Staff
Report – 20 October 2014).
39. OMV proposed another set of revised consent conditions in their legal closing on 18 November
2014. At our request, the EPA provided written advice on these revised consent conditions on 27
November 2014 (EPA Comments on OMV’s Conditions – 27 November 2014).
40. We found the conditions and overall recommendation in the EPA Staff Report to be helpful and note
that they assisted our deliberations. We note the recommendations in the EPA Staff Report are not
binding in any way and record we have had regard to the staff advice in accordance with section
59(3) of the EEZ Act.
4 Applications Manager, EEZ for the EPA. 5 EPA Staff Report, page 78.
10
1.4 Context of Application
1.4.1 Transitional Provisions
41. As already noted, OMV’s drilling programme is classified as a “planned petroleum activity” under the
EEZ Act and is covered under section 166, which is a transitional provision of the Act. Section 166 of
the EEZ Act allows such activities to commence without a marine consent and continue until 28 June
2014, provided that an Impact Assessment was submitted to the EPA beforehand.
42. The transitional period for planned petroleum activities ended on 28 June 2014, and OMV was
required to apply for marine consent for those activities not completed by that date. OMV submitted
this application for a marine consent on 3 June 2014. Section 166(5)(b) of the EEZ Act permits, as
part of its transitional provisions, OMV to continue its drilling programme (including those activities
that require a marine consent) while this application is being considered or until such time as any
appeals are determined.
43. OMV is required to comply with a number of statutory requirements outside of the EEZ Act that apply
to the drilling programme. A number of these statutory requirements include provisions that are
relevant to protection of the marine environment and relevant to this application for marine consent.
1.5 Submissions
44. OMV’s application for marine consent was publically notified by the EPA on 1 July 2014. The
submission period closed on 29 July 2014 – 155 submissions were received by the EPA, and no
submissions were received out of time following an extension of the timeframe requirements by us
on 14 August 2014.
45. A summary of the decision requested by submitters is provided in Table 3 below.
Table 3: Overall Position of Submitters
Submitter Position Number of Submitters Percentage
Grant 4 2.6%
Grant with conditions 2 1.3%
Neutral 2 1.3%
Decline 146 94.2%
Other 1 0.6%
46. A summary of the issues raised by submitters is provided in Appendix 4. Key themes included:
(a) adverse environmental effects of oil spills, pollution, noise, ship strikes, habitat loss and
degradation;
11
(b) adverse effects of the drilling programme on marine mammals, particularly the Maui’s
dolphin and blue whales;
(c) OMV’s economic benefit analysis is incomplete and misleading;
(d) provision of inadequate information (for example, no systematic marine population surveys
to robustly assess the direct, indirect and cumulative impacts of the drilling programme on
potentially affected species); and
(e) numerous risks associated with this drilling programme (and oil drilling in general) such that
the application for marine consent should be refused.
1.6 The Decision-making Process
47. Evidence and submissions were heard over eight hearing days between 29 October 2014 and 18
November 2014. Hearing days were scheduled in Wellington, Nelson and New Plymouth.
48. We have convened on 24 occasions (including hearing days) to assess the application for marine
consent, determine whether further information was necessary, set hearing procedures, review
evidence, deliberate and write our decision. We formally closed the hearing on 9 December 2014.
49. We record our appreciation for the time and effort taken by parties who participated in this
application. We appreciated the expert evidence on the potential effects of the drilling programme
and the ability to question the experts on their assessments. The opportunity to question government
agencies (to which section 44 requests were made) was valuable in determining the “nature and
effect” of other marine management regimes in terms of section 59(2)(h) of the EEZ Act.
50. Consenting processes, particularly public hearings, can be time consuming and daunting for
submitters, and we acknowledge their participation. The involvement and input of submitters is
important, and their input was helpful.
51. We were disappointed that a number of submitters who wished to be heard in Nelson did not appear.
Holding hearings in different locations is time consuming and expensive. The failure of submitters to
appear at the hearing at short notice or with no notice may undermine the viability of future hearings
in multiple locations and the ability of other submitters to be heard in support of their submissions.
12
Description of the Existing Environment and Existing 2.Interests
52. Section 39 of the EEZ Act requires the Impact Assessment to describe, among other things, the
existing environment. It also requires the Impact Assessment to identify persons whose existing
interests are likely to be adversely affected by the activity and identify the effects of the activity on
existing interests. Section 2 of the Impact Assessment and expert evidence given at the hearing
described the existing environment of the application site, the wider permit area (Petroleum Mining
Permit 38160) and the South Taranaki Bight.
53. The information provided in the Impact Assessment and expert evidence is drawn from a range of
sources. A full list of references is set out in section 9 of the Impact Assessment. Where the source
of the information is not specifically stated in the following descriptions of the existing environment,
we have drawn from the Impact Assessment and further information received from OMV.
54. There are various descriptions of the area that encompasses the South Taranaki Bight. However,
experts and submitters loosely used it as including the western end of Cook Strait, Tasman and
Golden Bays, Farewell Spit and the coastline of the Kapiti Coast, the Manawatu-Whanganui Region
and South Taranaki.
55. The Maari field is located within the South Taranaki Bight. Over 400 offshore and onshore
exploration and production wells have been drilled in the Taranaki Region and South Taranaki Bight.
Numerous discoveries have been developed for the production of gas, gas condensate and oil.
2.1 Physical Environment
2.1.1 Geological Setting
56. The Taranaki Basin is a late Mesozoic extension on the landward side of the Gondwana margin.
Jurassic and earliest Murihiku marine and non-marine rocks present in the Taranaki Basin are
generally regarded as basement but may also have been the earliest basin-fill. The Taranaki Basin
lies at the southern end of a rift that developed sub-parallel to the Tasman Sea rift, which now
separates Australia and New Zealand. The structure of the Taranaki Basin has been formed by
movements along the Taranaki, Cape Egmont and Turi fault zones.
2.1.2 Oceanography
57. The South Taranaki Bight is exposed to two significant bodies of water – the Tasman Sea and Cook
Strait. From the westerly quarter, long period swells can arrive from the Southern Ocean, which are
enhanced by the predominant west to southwest winds. From the south, the wave conditions can
produce steep and energetic seas when strong southeast winds are present.
58. Wave data collected in the permit area between July 2003 and March 2004 illustrates that the
dominant wave approach direction is from the west-southwest, with peak wave periods
13
predominantly in the range of 6–8 and 10–14 seconds. The mean significant wave height was 2.2 m,
with a maximum wave height of 6.71 m.
59. Annual wind roses produced for the permit area show the strongest winds are from the southeast
quarter, with the predominant wind from the west to southwest quarter. During the period between
July 2003 and March 2004 the strongest wind was 22.06 metres per second (ms-1), while the
average wind speed was 9.03 ms-1.
60. With respect to bathymetry, the Maari field lies on the western edge of the Farewell Rise. The
Farewell Rise is a subsea formation located approximately 45 km southwest of Opunake and in
water that is approximately 80–100 m deep. To the east of the Farewell Rise is a 2 km wide, shallow
trough marking the head of the D’Urville Sea Valley. The seabed has a gently sloping gradient
through the permit area, where it slopes down from approximately 100 m water depth on the eastern
side towards the west-northwest.
61. The dominant currents within the permit area are caused by the local and regional wind stresses on
the ocean surface in conjunction with tides. A wave-rider buoy was deployed in the permit area
between July 2003 and March 2004. The highest measured residual current speed in the mid-water
layer during this period was 0.52 ms-1, with a mean of 0.12 ms-1. The strongest currents were
directed towards the west and were typically associated with strong southeast wind events.
62. Dr Lincoln MacKenzie6 noted upwelling plumes originating along the Kahurangi Shoal off the west
coast of the South Island are primarily responsible for the productivity patterns in the South Taranaki
Bight. These plumes are highly variable (both spatially and temporally) and comprise cold, nutrient-
rich water that often becomes recruited into eddies, which are shed off the tip of Cape Farewell and
migrate through the South Taranaki Bight.
63. Thermal stratification of the water column is typically evident during spring and summer months.
Stratification patterns through the water column vary, with storm conditions causing significant
vertical mixing and the breakdown of the thermal structure in the colder months. The average sea
surface water temperature ranges between 17.3 degrees Celsius (°C) in summer and 13.6°C in
winter.
64. Waves and currents are the dominant mechanisms for sediment transport. Core samples collected
around the permit area in January 2012 indicated that the sediment profiles consist of a fairly uniform
muddy texture throughout the depth of the core with no noticeable sediment anoxia. Profiles of this
nature were also collected from the nearby Ruru and Maui sites so are considered typical of this
area.
65. The permit area lies in an area of high current flow which results in relatively lower deposition rates
of sediment content. Benthic surveys within the permit area have shown the seabed consists of
irregular mega-rippled bedforms with amplitude of approximately 0.1 m and some wave-induced
6 Senior Research Scientist at the Cawthron Institute appearing on behalf of OMV New Zealand Limited.
14
ripples. Video observations and surficial sediment samples suggest there is active bioturbation of the
upper sediments in the form of burrow holes and trail marks. Some larger holes have also been
observed. These could be a result of foraging fish habits, bioturbation from digging shrimp or as the
result of previous human activity from previous sample grabs.
2.2 Biological Environment
2.2.1 Benthic Ecosystems
66. Mr Rodney Asher7 and Dr Jennifer Skilton8 stated that benthic communities in the South Taranaki
Bight are dominated by soft sand/mud substrates that support a range of macro-faunal species
(polychaete worms, cumaceans, amphipods and bivalves). The offshore marine area is a uniform
physical environment with low habitat diversity and with no known taxa or communities of special
conservation/scientific interest.
67. Polychaetes are the most dominant taxonomic group around the permit area and are resilient to
suspended sediment, which is a common feature of the high-energy maritime environment of the
permit area.
68. Overall, the macro-benthic ecosystem around the permit area is considered to have low
environmental sensitivity.
2.2.2 Plankton and Primary Productivity
69. The productivity of the South Taranaki Bight is largely driven by the nutrient-rich upwelling plumes
from the Kahurangi Shoal off the west coast of the South Island. The eddies that travel northwards
and eastwards towards the South Taranaki Bight become nutrient depleted and phytoplankton rich.
The water contains high levels of chlorophyll-α, which is an indicator for plankton productivity.
70. Water column analysis undertaken within the permit area in July 2003 indicated that there are no
pronounced vertical trends in chlorophyll-α levels, which reflects the well mixed nature of the water
column around the permit area.
71. Dr MacKenzie stated that the South Taranaki Basin has high levels of biological primary productivity
upon which multiple species (including blue whales) seasonally depend. Despite this, the Impact
Assessment stated that the environmental sensitivity of primary production in the permit area was
low as it was a very small proportion of the total area for which high productivity has been identified.
2.2.3 Fish Species
72. Dr Alison MacDiarmid9 noted that fish populations around the permit area comprise demersal and
pelagic species, most of which are widely distributed from north to south and across different water
7 Owner/Manager of Biolive Invertebrate ID Service appearing on behalf of OMV New Zealand Limited. 8 Benthic Ecologist at REM Limited appearing on behalf of OMV New Zealand Limited. 9 Principal Scientist at NIWA appearing on behalf of OMV New Zealand Limited.
15
depths. The following species are most likely to be encountered within the permit area: snapper,
trevally, kahawai, gurnard, blue warehou, blue cod, bluenose, john dory, hāpuku, rig, school shark,
spiny dogfish, blue mackerel, jack mackerel, leatherjacket, red cod, tarakihi and kingfish.
73. Over the summer months a number of pelagic species visit the Taranaki coastline following the
abundance of food. The most common species include sunfish, flying fish, marlin, albacore, skipjack
and yellowfin tuna, mako and blue shark. These species could be present within the permit area.
74. Eighty-two species of New Zealand marine fish are listed as being in gradual decline, sparse or
range restricted, and some will be found in and around the permit area. Great white sharks may be
attracted to seal populations around offshore installations and are fully protected in New Zealand
waters.
75. The Ministry for Primary Industries advised that commercial fishers operating in and around the
permit area primarily target jack mackerel, with a bycatch of barracouta.
2.2.4 Marine Mammals
76. Ms Helen McConnell10 identified a list of marine mammals that may be present in and around the
permit area. She considered the likelihood of each species being present by assessing life history
characteristics, habitat preferences and records of previous sightings and strandings.
77. The key points of Ms McConnell’s analysis were as follows:
(a) Humpback whales are likely to be present in the permit area between May and December as
they travel towards their breeding habitat in waters off the Pacific Islands.
(b) Southern right whale sightings in Taranaki waters can be expected inshore of the permit
area in winter and in coastal waters during the breeding season. However, they may
complete their southward migration further off shore.
(c) Blue whales have recently been found to forage in the waters of Cook Strait and Taranaki,
but their elusive behaviour means that little detail is known of their distribution or habitat use.
(d) Pilot whales are common visitors to Taranaki waters during the summer months and are
likely to be observed in the permit area.
(e) It is unlikely that Hector’s dolphins11 routinely populate the permit area due to their typical
inshore distribution and the fact that their population concentrations do not overlap with the
permit area. However, the water depth at the WHP does not rule out the occasional
presence of Hector’s dolphins.
(f) New Zealand fur seals are likely to be present in the permit area, and they have a continual
presence at the offshore platforms in Taranaki. The closest fur seal breeding location to the
10 Marine Ecologist at REM Limited appearing on behalf of OMV New Zealand Limited. 11 Any reference to Hector’s dolphin in this decision also includes the subspecies of Maui’s dolphin, unless stated otherwise.
16
Maari field is at Sugar Loaf Islands off New Plymouth, where pupping occurs from mid-
November to mid-January.
2.2.5 Seabirds
78. The Impact Assessment included a list of the seabirds that could be present in the permit area. This
was based on information obtained from a variety of sources including the Department of
Conservation, the Ministry for Primary Industries and the Taranaki Regional Oil Spill Contingency
Plan.
79. A number of threatened seabird species may occasionally use the permit area as part of their broad
pelagic habitat. However, no known critical habitat occurs in the permit area.
2.2.6 Marine Reptiles and Corals
80. Marine reptiles occasionally visit Taranaki waters, mainly during the summer months when the
warmer currents push down the western side of New Zealand. Leatherback turtles and yellow-bellied
sea snakes have been observed within Taranaki waters (Department of Conservation, 2014c), but
are rarely seen.
81. Black coral within the EEZ is protected under the Wildlife Act 1953. There is no black coral
documented within the permit area (Ministry for Primary Industries, 2014a), although small areas of
coral habitat are located to the southeast of the permit area and on the continental shelf to the
northwest.
82. The WHP is in water that is much shallower than the habitat of black coral.
2.2.7 Sites of Conservation Significance
83. No marine reserves, marine mammal sanctuaries or areas of significant conservation value are in
the immediate vicinity of the permit area.
84. Marine reserves in the wider environment are located at Parininihi and Tapuae. The Sugar Loaf
Islands Marine Protected Area is close to New Plymouth. Further afield there are marine reserves in
the Greater Wellington Region at Kapiti and Taputeranga and in the Marlborough Sounds at
Westhaven, Tonga Island, Horoirangi and Long Island.
85. The West Coast North Island Marine Mammal Sanctuary extends 12 nautical miles (nm) offshore
from Oakura Beach in the south to Maunganui Bluff in Northland. The purpose of this sanctuary is to
provide protection to the Hector’s dolphin. The sanctuary covers 2,164 km of coastline.
86. The nearest marine mammal sanctuary in the South Island is located in Clifford/Cloudy Bay.
87. Numerous areas along the coastline of the South Taranaki Bight have also been identified as areas
of significant conservation value in the relevant regional and district planning documents (for
example, the Taranaki Regional Coastal Plan).
17
2.3 Existing Interests
2.3.1 Iwi Interests
88. The Taranaki Region is home to a number of iwi and hapū, and the drilling programme is located in
the rohe moana of Ngāti Ruanui. The Impact Assessment stated that there are iwi and hapū in the
Taranaki Region who “may not satisfy the definition of ‘existing interest’, but whose interests we have
considered as they each have coastal areas that are of high cultural importance to them for
collecting marine resources and protection of spiritual values”.
89. The Impact Assessment stated that there are no current Treaty of Waitangi claims in relation to the
permit area.
90. The EPA Staff Report noted that the information provided in the Impact Assessment was adequate
for completeness. Further information was requested from OMV about the existing interests
identified by Māori during consultation. It noted that the interests identified in the Impact Assessment
may not have been broad enough to cover those likely to be affected by a significant oil spill, whether
or not the spill reached land. Māori interests in such a case would extend beyond the Taranaki
Region and could potentially include a significantly larger number of iwi.
91. The EPA Staff Report stated there are lawfully established cultural activities that continue to be
exercised either separately or in association with iwi fisheries interests, such as kaitiakitanga,
rangatiratanga and the maintenance of mātauranga Māori. These are associated with preserving
Māori fisheries interests, the right of iwi to make decisions and act on issues affecting their fisheries
interests and the system of knowledge associated with Māori commercial and customary activities.
2.3.2 Fishing Interests
92. The permit area lies within Fisheries Management Area 7 (Challenger Region), although it is not
commonly used as a fishing ground for commercial fisheries. The Ministry for Primary Industries
confirmed that there was only one recorded fishing event in each of the 2010/11 and 2011/12 fishing
years. The species targeted were leatherjacket and tarakihi.
93. Little, if any, recreational fishing occurs in the permit area due to its remote location. No recreational
fishing can occur near the WHP due to the existing 500 m exclusion zone.
2.3.3 Commercial Shipping Interests
94. The permit area lies within the Taranaki Precautionary Area. All ships traversing this area must
navigate with particular caution to reduce the risk of maritime casualties and marine pollution.
95. The precautionary area is defined as a standing notice in the annual Notice to Mariners in the New
Zealand Nautical Almanac. The almanac lists the navigation hazards within the Taranaki
Precautionary Area, which contains the Pohokura, Maui, Maari, Tui and Kupe fields.
18
Statutory Framework 3.
3.1 Introduction
96. This section sets out the statutory framework under the following headings:
(a) Purpose and Principles of the EEZ Act;
(b) Section 20 – Restrictions on Activities in the Exclusive Economic Zone and Continental
Shelf;
(c) Decision-making Criteria; and
(d) Information Principles.
97. There are other laws and regulations relevant to our decision-making on this application for marine
consent, and these must be taken into account under sections 59(2)(k) and (l) of the EEZ Act. A
number of these other laws and regulations include environmental considerations and are discussed
further in section 13 of this decision.
3.2 Purpose and Principles of the EEZ Act
3.2.1 Purpose
98. Section 10(1) of the EEZ Act states:
“The purpose of this Act is to promote the sustainable management of the natural resources of the
exclusive economic zone and the continental shelf.”
99. ‘Sustainable management’ is defined in section 10(2) as follows:
“In this Act, sustainable management means managing the use, development, and protection of
natural resources in a way, or at a rate, that enables people to provide for their economic well-being
while—
(a) sustaining the potential of natural resources (excluding minerals) to meet the reasonably
foreseeable needs of future generations; and
(b) safeguarding the life-supporting capacity of the environment; and
(c) avoiding, remedying, or mitigating any adverse effects of activities on the environment.”
100. The resources to be sustainably managed under the EEZ Act are the “natural resources of the
exclusive economic zone and continental shelf”. Section 4(1) of the EEZ Act defines natural
resources as:
“(a) in relation to the exclusive economic zone, includes seabed, subsoil, water, air, minerals,
and energy, and all forms of organisms (whether native to New Zealand or introduced); and
19
(b) in relation to the continental shelf, means the mineral and other non-living resources of the
seabed and subsoil and sedentary species.”
101. The definition of sustainable management in section 10(2) of the EEZ Act refers to “managing the
use, development, and protection of natural resources in a way, or at a rate, that enables people to
provide for their economic well-being”. This must be done whilst sustaining the potential of natural
resources to meet the reasonably foreseeable needs of future generations, safeguarding the life-
supporting capacity of the environment and avoiding, remedying or mitigating any adverse effects on
the environment.
102. Section 4(1) of the EEZ Act defines ‘environment’ as:
“the natural environment, including ecosystems and their constituent parts and all natural resources,
of—
(a) New Zealand:
(b) the exclusive economic zone:
(c) the continental shelf:
(d) the waters beyond the exclusive economic zone and above and beyond the continental
shelf.”
103. Section 10(3) of the EEZ Act states:
“In order to achieve the purpose, decision-makers must—
(a) take into account decision-making criteria specified in relation to particular decisions; and
(b) apply the information principles to the development of regulations and the consideration of
applications for marine consent.”
104. The decision-making criteria referred to in section 10(3)(a) of the EEZ Act are set out in sections 59
and 60 of the Act. The information principles are found in section 61. These provisions are discussed
in detail later in this decision.
3.2.2 International Obligations
105. Section 11 of the EEZ Act states:
“This Act continues or enables the implementation of New Zealand’s obligations under various
international conventions relating to the marine environment, including—
(a) the United Nations Convention on the Law of the Sea 1982:
(b) the Convention on Biological Diversity 1992.”
106. New Zealand’s international obligations do not require additional considerations to be applied in
addition to the decision-making criteria and information principles contained in the EEZ Act. These
are already encapsulated in the EEZ Act and in other marine management regimes.
20
3.2.3 Te Tiriti o Waitangi – Treaty of Waitangi
107. Section 12 of the EEZ Act states:
“In order to recognise and respect the Crown’s responsibility to give effect to the principles of the
Treaty of Waitangi for the purposes of this Act,—
(a) section 18 (which relates to the function of the Māori Advisory Committee) provides for the
Māori Advisory Committee to advise the Environmental Protection Authority so that decisions
made under this Act may be informed by a Māori perspective; and
(b) section 32 requires the Minister to establish and use a process that gives iwi adequate time
and opportunity to comment on the subject matter of proposed regulations; and
(c) sections 33 and 59, respectively, require the Minister and the EPA to take into account the
effects of activities on existing interests; and
(d) section 45 requires the Environmental Protection Authority to notify iwi authorities, customary
marine title groups, and protected customary rights groups directly of consent applications
that may affect them.”
108. Matters of cultural relevance are addressed through the EPA’s obligation to notify relevant Māori
groups of applications for marine consent, the ability for the DMC to receive specialist advice on
matters pertaining to Māori (including from NKTT) and the requirement to take into account the effect
of activities on existing interests, which can include certain Māori interests.
3.3 Section 20 – Restrictions on Activities in Exclusive Economic Zone and
Continental Shelf
109. Section 20 of the EEZ Act restricts certain activities from being undertaken in the EEZ or in or on the
continental shelf unless they are authorised by or under the EEZ Act. An analysis of the activities
involved in OMV’s development drilling programme that require marine consent under section 20 of
the EEZ Act is set out in the Impact Assessment and in the evidence of Mr Craig Welsh.12
3.4 Decision-making Criteria
110. Sections 59 and 60 of the EEZ Act set out the matters we must consider in coming to a decision on
an application for marine consent.
“59 Environmental Protection Authority’s consideration of application
(1) This section and sections 60 and 61 apply when the Environmental Protection Authority is
considering an application for a Marine Consent and submissions on the application.
12 Managing Director of REM Limited appearing on behalf of OMV New Zealand Limited.
21
(2) The EPA must take into account—
(a) any effects on the environment or existing interests of allowing the activity, including—
(i) cumulative effects; and
(ii) effects that may occur in New Zealand or in the waters above or beyond the
continental shelf beyond the outer limits of the exclusive economic zone; and
(b) the effects on the environment or existing interests of other activities undertaken in the
area covered by the application or in its vicinity, including—
(i) the effects of activities that are not regulated under this Act; and
(ii) effects that may occur in New Zealand or in the waters above or beyond the
continental shelf beyond the outer limits of the exclusive economic zone; and
(c) the effects on human health that may arise from effects on the environment; and
(d) the importance of protecting the biological diversity and integrity of marine species,
ecosystems, and processes; and
(e) the importance of protecting rare and vulnerable ecosystems and the habitats of
threatened species; and
(f) the economic benefit to New Zealand of allowing the application; and
(g) the efficient use and development of natural resources; and
(h) the nature and effect of other marine management regimes; and
(i) best practice in relation to an industry or activity; and
(j) the extent to which imposing conditions under section 63 might avoid, remedy, or
mitigate the adverse effects of the activity; and
(k) relevant regulations; and
(l) any other applicable law; and
(m) any other matter the EPA considers relevant and reasonably necessary to determine
the application.
(3) The EPA must have regard to—
(a) any submissions made and evidence given in relation to the application; and
(b) any advice, reports, or information it has sought and received in relation to the
application; and
(c) any advice received from the Māori Advisory Committee.
(4) When considering an application affected by section 74, the EPA must also have regard to
the value of the investment in the activity of the existing consent holder.
22
(5) Despite subsection (3), the EPA must not have regard to—
(a) trade competition or the effects of trade competition; or
(b) the effects on climate change of discharging greenhouse gases into the air; or
(c) any effects on a person’s existing interest if the person has given written approval to
the proposed activity.
(6) Subsection (5)(c) does not apply if the person has given written approval but the person
withdraws the approval by giving written notice to the EPA—
(a) before the date of the hearing, if there is one; or
(b) if there is no hearing, before the EPA decides the application.
60 Matters to be considered in deciding extent of adverse effects on existing interests
In considering the effects of an activity on existing interests under section 59(2)(a), the
Environmental Protection Authority must have regard to—
(a) the area that the activity would have in common with the existing interest; and
(b) the degree to which both the activity and the existing interest must be carried out to
the exclusion of other activities; and
(c) whether the existing interest can be exercised only in the area to which the application
relates; and
(d) any other relevant matter.”
111. There is no explicit hierarchy in the extensive list of matters that must be taken into account under
section 59(2) of the EEZ Act. The relative importance of these depends on the specifics of each
marine consent application, the nature of the environment and the extent and nature of existing
interests. However, sections 59(2)(d) and 59(2)(e) include the qualifying words “the importance of
protecting”, which are not used in any of the other sub-clauses. This suggests Parliament intended
there should be particular emphasis on the protection of important biological resources.
112. The drilling programme is taking place in the EEZ, but we are required to take into account effects
that may occur from allowing the activities, including those that may occur outside the EEZ. This
clear requirement to take into account effects that may occur from allowing the activities, including
those effects that may occur outside the EEZ, is important, as some of the potential adverse effects
(particularly in relation to an oil spill) may occur within the Coastal Marine Area (CMA).
113. Section 59(2)(m) of the EEZ Act requires us to consider any other matter we think is relevant and
reasonably necessary to determine the application. We consider these ‘other matters’ in section 14
of this decision
114. Section 59(2) of the EEZ Act sets out matters we “must take into account”, and section 59(3) states
we “must have regard to” any submissions or evidence given to us, any advice or reports we have
23
sought and any advice from NKTT. We have had regard to these obligations in reaching our
decision.
3.5 Information Principles
115. Section 61 of the EEZ Act states:
“61 Information principles
(1) When considering an application for a Marine Consent, the Environmental Protection
Authority must—
(a) make full use of its powers to request information from the applicant, obtain advice,
and commission a review or a report; and
(b) base decisions on the best available information; and
(c) take into account any uncertainty or inadequacy in the information available.
(2) If, in relation to making a decision under this Act, the information available is uncertain or
inadequate, the EPA must favour caution and environmental protection.
(3) If favouring caution and environmental protection means that an activity is likely to be
refused, the EPA must first consider whether taking an adaptive management approach
would allow the activity to be undertaken.
(4) Subsection (3) does not limit section 63 or 64.
(5) In this section, best available information means the best information that, in the particular
circumstances, is available without unreasonable cost, effort, or time.”
3.5.1 Full Use of Powers
116. We are satisfied we have made full use of our powers to request and access information and
consider we have met our responsibility under section 61(1)(a) of the EEZ Act.
117. In this case, we have had the benefit of:
(a) the application by OMV and the Impact Assessment (including supporting technical
documents);
(b) the completeness and gap analysis by Environmental Resources Management;
(c) additional information supplied by OMV at the request of the DMC and EPA (refer to
Appendix 3);
(d) advice from other agencies with responsibility for other marine management regimes (refer
to Appendix 3);
(e) submissions from interested parties, including from parties with existing interests that may be
affected by the drilling programme;
24
(f) expert evidence, both written and oral, and supplemented by cross-examination and
questioning by us;
(g) non-expert evidence and representations in support of submissions;
(h) additional information supplied by OMV and other parties at our request during the hearing;
(i) legal representations in both opening and closing the hearing on behalf of OMV;
(j) legal advice from Luke Cunningham Clere (Office of the Wellington Crown Solicitor) and
EPA inhouse counsel in relation to issues of duplication and enforcement of conditions
imposed under the EEZ Act and/or required by other marine management regimes; and
(k) the EPA Staff Report (including the reports by NKTT and Genesis Oil and Gas Consultancy
Limited).
118. We also requested that OMV provide us with a copy of the Safety Cases that had been accepted by
WorkSafe New Zealand and the DMPs approved by Maritime New Zealand. This information was
requested on 20 October 2014 and eventually provided to us by OMV on 7 November 2014. The
importance of these documents to our decision-making is discussed in section 3.5.2 below.
3.5.2 Best Available Information
119. We are satisfied that we have been able to make our decision based on the best available
information in accordance with section 61(1)(b) of the EEZ Act.
120. Pursuant to section 61(1)(b) of the EEZ Act, we must make our decision based on the best available
information. “Best available information” is defined in section 61(5) of the EEZ Act. However, it is
important to note that best available information is not necessarily ‘all available information’. We are
required to exercise judgement about what information is the best available information for this
particular application, having regard to issues of cost, effort and time.
121. Shortly after our appointment we indicated that we did not have sufficient information regarding
potential cumulative effects of the drilling programme.
122. We also considered we needed to view the DMPs and Safety Cases to consider the nature and
effect of other marine management regimes and, if necessary, to impose conditions. OMV initially
refused to provide us with the Safety Cases and DMPs. Following further discussion during the
hearing, the documents were provided to us on 7 November 2014 along with an application under
section 158(1) of the EEZ Act seeking a direction under section 158(3)(b) of the Act prohibiting their
publication and communication.
123. In response, we issued a minute on 10 November 2014 advising that we had decided to exercise our
delegated power from the EPA to issue a direction under section 158(3)(b) of the EEZ Act on the
following terms:
(a) The publication and communication of the documents is prohibited.
25
(b) Any person who may be heard at the hearing of the application for marine consent is entitled
upon request to view under supervision (but not reproduce) the documents for the purpose
of participation in the proceedings. No other person will have access to the documents
during the proceedings.
(c) The direction applies until the conclusion of the proceedings relating to the application for
marine consent in accordance with section 158(4)(b) of the EEZ Act, unless otherwise varied
by the EPA.
124. On 11 November 2014 we issued a minute inviting submitters who indicated an intention to speak at
the hearing to comment in writing in relation to any of the information contained within the Safety
Case and DMP. In response we received comment from one submitter outlining a number of matters
of concern. Some of the matters raised by the submitter were out of scope (matters pertaining to
consultation, injection water and completion fluids), but matters relating to drilling muds are relevant
and have been considered in our decision-making.
125. On the basis of the above, we are satisfied that we have been able to make our decision based on
the best available information in accordance with section 61(1)(b) of the EEZ Act.
26
Context for Consideration and Evaluation 4.
126. Section 59(2) of the EEZ requires us to consider a number of relevant matters. These matters are
evaluated and considered as follows:
(a) Section 5 addresses potential effects on the environment and existing interests.
(b) Section 6 addresses potential effects on human health.
(c) Section 7 addresses the importance of protecting the biological diversity and integrity of
marine species, ecosystems and processes.
(d) Section 8 addresses the importance of protecting rare and vulnerable ecosystems and the
habitats of threatened species.
(e) Section 9 addresses the economic benefit to New Zealand of allowing the application.
(f) Section 10 addresses the efficient use and development of natural resources.
(g) Section 11 addresses the nature and effect of other marine management regimes.
(h) Section 12 considers the imposition of conditions to avoid, remedy or mitigate the adverse
effects of the drilling programme.
(i) Section 13 addresses other relevant regulations and laws.
(j) Section 14 addresses other matters potentially relevant to the drilling programme.
(k) Section 15 addresses the need for adaptive management.
127. The discussion on the topics listed in sections 5 and 6 of this decision is organised under the
following subheadings:
(a) The issues
(b) The effects
(c) Findings
(d) Conditions.
128. We note that section 63(1) of the EEZ Act states: “The Environmental Protection Authority may grant
a marine consent on any condition that it considers appropriate to deal with adverse effects of the
activity authorised by the consent on the environment or existing interests.”
129. Section 59(2)(j) of the EEZ Act requires us to take into account “the extent to which imposing
conditions under section 63 might avoid, remedy, or mitigate the adverse effects of the activity”.
130. We have wide discretion in terms of imposing conditions on this application for marine consent and
have carefully considered the conditions proffered by OMV in its closing legal submissions, as well
as those recommended by EPA staff. Our findings on the proffered conditions are set out in sections
5 and 12 of this decision.
27
Potential Effects on the Environment and Existing Interests 5.
5.1 Introduction
131. Sections 59(2)(a) and (b) of the EEZ Act require us to take into account the effects of allowing the
activity on the environment and/or existing interests. This requires us to take into account other
activities occurring in the vicinity of the application site, including those not regulated under the EEZ
Act, and the likely effects of these on the environment and existing interests. Section 59(3) of the
EEZ Act requires us to have regard to submissions and evidence, any advice provided to us in
relation to the application and any advice received from NKTT.
132. This section summarises our understanding of the key potential effects of the drilling programme on
the environment and existing interests based on the Impact Assessment, the EPA Staff Report
(including the report by NKTT), submissions and the expert evidence. It also outlines our findings on
these potential effects.
133. We have taken into account the definition of “effect” in section 6 of the EEZ Act and the requirement
to consider any potential cumulative effects and potential effects of low probability but high potential
impact.
134. We have taken into account the effects on the environment or existing interests of allowing the
activity that may occur outside of the EEZ in accordance with sections 59(2)(a)(ii) and (b)(ii) of the
EEZ Act. The area outside of the EEZ comprises “in New Zealand or in the waters above or beyond
the continental shelf beyond the outer limits of the exclusive economic zone”.
135. The key potential effects of the drilling programme on the environment and existing interests are
categorised under the following sub-headings:
(a) Benthic communities
(b) Planktonic communities
(c) Marine mammals
(d) Seabirds
(e) Fish
(f) Biosecurity
(g) Existing interests.
136. The potential effects of an oil spill event are considered under a separate sub-heading in this section.
We have adopted this approach as the potential effects of an oil spill may manifest across many of
the identified environmental values and existing interests. An oil spill event also has the potential to
generate effects on the environment outside of the EEZ.
28
5.2 Macro-benthic Communities
5.2.1 The Issues
137. The key potential adverse effects on macro-benthic communities are:
(a) the deposition of drill cuttings and muds onto the seabed;
(b) the presence of contaminants within the drill cuttings and muds; and
(c) the presence and removal of the ENSCO 107.
5.2.2 The Effects
Deposition of Drill Cuttings and Muds
138. A number of submitters expressed concern about the potential loss of marine habitat and the
degradation of the marine environment. Ms Janice Liddle13 expressed the sentiment that the “ocean
is not a dumping ground”. She said she had no faith in the dispersal modelling analysis undertaken
by MetOcean Solutions Limited.
139. Dr Peter McComb14 explained the modelling used to predict the dispersal and deposition of drill
cuttings and muds from the drilling programme. He noted the modelling predicted that the finer
cutting particles will settle very slowly through the water column and become more widely dispersed
by tidal and oceanic currents. The larger particles will settle much closer to the discharge point
beneath the WHP. He stated that the modelling predicted a maximum depositional thickness on the
seafloor of approximately 3 mm for each well and a cumulative maximum depositional thickness in
the range of 9–13 mm. He noted that a depositional thickness greater than 1 mm will not occur
beyond a 250 m radius from the WHP and that 90% of the drill cuttings and muds will settle to the
seabed within approximately 40 km of the WHP.
140. The dispersal modelling report noted two important assumptions had been made in the study: “First,
that the size distribution and settling velocities of the drill cuttings are based on a published dataset.
However, the rock type and drilling equipment used will determine the actual physical properties of
the cuttings to be discharged and the flocculation in the presence of OBM or SBM may act to change
the settling velocity distributions. Second, the simulations do not take into account the probable initial
velocity conditions, density-driven momentum or influence on localised flows due to the presence of
the drilling equipment.”
141. Mr Asher said that seabed sampling showed that the effects of the drilling programme on macro-
benthic communities (those organisms greater than 0.5 mm in size and living on or in the seabed to
a depth of 100 mm) will be localised and minor. He identified that changes do occur in the diversity
and abundance of some invertebrate species around structures but that the base communities
remain the same at the Maari site and at control areas. He noted that there are no detectable
13 Submission number 110317. 14 Managing Director of MetOcean Solutions Limited on behalf of OMV New Zealand Limited.
29
changes beyond a distance of 250 m from the WHP and concluded that adequate measures are in
place to mitigate adverse effects on macro-benthic communities.
142. Dr Skilton concluded that the drilling programme has the potential to change the physical, chemical
and compositional properties of the seabed sediment by reducing sediment quality and adversely
affecting macro-benthic invertebrate communities. However, she stated that sediment monitoring
indicated any adverse effects on sediment quality will be localised and no more than minor, provided
that the mitigation proposed by OMV is adhered to.
Contamination Effects on Sediments
143. 23 submitters raised concerns regarding the toxicity of the waste material generated by the drilling
programme. Many had concerns about the toxicity of WBMs and SBMs to marine life. Some
submitters stated that it is not acceptable to say that the ocean will dilute toxins, and they considered
some contaminants to be insoluble and likely to disperse.
144. Dr Skilton explained that macro-benthic ecological surveys by the Cawthron Institute show that none
of the metal concentrations of arsenic, nickel, iron, copper, cadmium, mercury, zinc, lead, chromium
and manganese displayed any radial trends near the WHP or the FPSO, with the exception of
barium. She noted metal concentrations at the monitoring sampling stations were similar to, or lower
than, concentrations at the benthic sediment monitoring control sites.
145. In supplementary evidence, Dr Skilton emphasised that concentrations of all metals/metalloids, total
petroleum hydrocarbons (TPHs) and polycyclic aromatic hydrocarbons (PAHs) fall below the
applicable ANZECC interim sediment quality guideline low trigger value levels at distances of more
than 250 m from the WHP and FPSO. Dr Skilton concluded that the drilling programme will not have
undue adverse effects on macro-benthic sediments and communities.
146. Dr Skilton explained that WBMs are largely soluble in the marine environment and display higher
capacity for dilution and dispersion than SBMs. She noted they are much less likely to settle on the
seafloor than SBMs. She stated that the precipitation of barite can cause the smothering of benthic
sediments and immobile macro-benthic species but that the bioavailability of this precipitate is very
low and it is not normally considered toxic. Dr Skilton concluded that the drilling programme will
“most likely” have minor effects on barium concentrations in sediments based on the results of
macro-benthic ecological surveys and background barium concentrations. Dr Skilton stated that
these results indicated that the drilling programme has had a minor influence on barium
concentrations in sediments and that the concentrations reduced to approximate background levels
within 1–2 km from the WHP.
147. Dr Skilton explained that effects of SBMs have the potential to be more adverse due to a relatively
high discharge of synthetics occurring within a small area and rapid settlement. She noted potential
effects on sediments included the contamination of sediments, sediment organic enrichment and
anoxia and the smothering of macro-benthic communities. Dr Skilton concluded that the deposition
of SBMs will present a medium localised environmental risk to the macro-benthic environment near
the WHP and noted that this conclusion is consistent with the approved DMP for the ENSCO 107.
30
Presence and Removal of the ENSCO 107
148. A number of submitters expressed concern about the potential loss of marine habitat and the
degradation of the marine environment. These submissions are relevant to the evaluation of the
potential effects associated with the presence and removal of the ENSCO 107.
149. Mr Asher stated that most of the effects of structures on macro-benthic ecology come from biological
fouling. He concluded that the presence of the ENSCO 107 is “unlikely” to alter macro-benthic
communities further, as the WHP has been operational since 2008 and these changes have already
occurred. He stated that the removal of the ENSCO 107 will result in temporary physical disturbance
of sediment and potential smothering of macro-benthic organisms but that recovery would begin
immediately and progressively with resettlement from populations nearby over two to three years.
150. Dr Skilton concluded that the removal of the ENSCO 107 will cause an upheaval of sediments that
may smother surface benthic sediments and sessile epifauna and noted that small-scale bathymetric
changes by way of three indentations where each spud can was located would remain. She
reiterated that the ENSCO 107 has been in this location before and that the rig legs had been placed
in the same indentations created from previous drilling operations. She noted this had avoided
additional indentations in the seabed and had minimised further benthic disturbance.
5.2.3 Findings
151. Having considered the information available, submissions and evidence, we find the following in
respect to the potential adverse effects of the drilling programme on benthic sediment and
communities:
(a) The dispersal and deposition modelling undertaken by MetOcean Solutions Limited is
satisfactory for the purposes for which it has been used, and the assumptions that informed
the model are reasonable. We are satisfied that the best available information has been
utilised in developing the dispersal and deposition model.
(b) The available baseline information on macro-benthic communities and the monitoring that
has been undertaken subsequent to previous drilling operations (within the permit area and
at other sites) provides us with sufficient confidence regarding the assessment of potential
effects on benthic sediment and macro-benthic communities.
(c) We agree with the conclusions of Mr Asher and Dr Skilton that the potential adverse effects
on macro-benthic communities from the deposition of the drill cuttings and muds, the
contamination of benthic sediments and the presence and removal of the ENSCO 107 will be
extremely localised, minor and temporary. Any long-term changes will be negligible. We note
also that both Mr Asher and Dr Skilton agreed, when questioned, that they would not regard
the observed changes in macro-benthic communities as significant or adverse.
(d) Barium is found within subsurface rock and most drilling muds. Its bioavailability is limited.
We accept the evidence of Mr Asher that there appears to be no direct correlation between
barium concentrations and macro-benthic taxa health in the monitoring undertaken to date.
31
(e) The potential for disturbance to macro-benthic communities associated with the presence of
the ENSCO 107 has been mitigated by the placement of the rig in the same location as the
previous drilling operations in 2008. The recovery of macro-benthic communities appears to
have occurred relatively rapidly.
(f) Given the relatively temporary, localised and minor scale of potential adverse effects on
macro-benthic communities, we accept any potential cumulative effects associated with the
drilling programme will be negligible in the context of the wider environment.
5.2.4 Conditions
152. Conditions have been proffered by OMV, and recommended by the EPA, with respect to the
management and monitoring of the potential effects of the drilling programme on macro-benthic
communities. We have carefully considered these conditions and have decided to impose the
following conditions in relation to benthic communities: Conditions 16, 17, 18, 19, 20, 21, 33 and 34.
5.3 Planktonic Communities
5.3.1 The Issues
153. The key potential adverse effects on planktonic communities are:
(a) the contaminants within the drill cuttings and muds discharged into the water column; and
(b) the increased turbidity in the water column from the discharge of drill cuttings and mud.
5.3.2 The Effects
Toxicity of Drill Cuttings and Muds to Phytoplankton and Zooplankton
154. 23 submitters raised concerns regarding the toxicity of the waste material generated by the drilling
programme. A number said that the drilling programme would adversely affect ecosystem processes
and the marine food chain.
155. Dr MacKenzie stated that the impact of drill cuttings and muds on flora and fauna in the water
column depends on its inherent toxicity, the concentration of contaminants and the duration of
exposure to organisms in the water column. He noted this is highly dependent on the rate and extent
of dilution and dispersion. He explained that, when drill cuttings and muds are discharged, most of
the material forms a plume that sinks rapidly to the seabed and that the remaining fraction of the
muds form another plume that drifts from the discharge point under the influence of the currents and
is widely dispersed and diluted in the process. His evidence aligned with the dispersion modelling
evidence presented by Dr McComb.
156. Dr MacKenzie identified that Neff (1987) maintained that, based on laboratory studies of acute and
chronic/sublethal toxicity of drilling muds and field observations of rates of dilution of drilling muds,
water column organisms are not exposed to drilling fluids long enough and at sufficiently high
concentrations to “elicit any acute or sub-lethal responses”.
32
157. Dr MacKenzie explained that SBMs have a propensity to clump and sink near the discharge location,
whereas WBMs disperse more widely. He also noted that Neff et al. (2000) stated “the effects of SBF
[i.e. SBM] cuttings on pelagic organisms are expected to be even less than those of WBFs [i.e.
WBMs] because of the low toxicity of SBFs (similar or lower than the toxicity of WBFs) and the
reduced exposure time due to rapid settling of SBF cuttings clumps and particles out of the water
column”.
158. Dr MacKenzie explained that potentially toxic metals such as chromium, cadmium, copper, arsenic,
mercury and lead (which may be contained in drilling fluids) are not bioavailable because they are
present almost exclusively as insoluble inclusions in drilling mud ingredients and cuttings minerals.
He noted field and laboratory studies have shown that metals in drilling fluids and cuttings are not
bio-accumulated by marine organisms (Neff, 2010) and do not present a hazard to pelagic marine
food webs. This was also explained by Ms Fleur Tiernan15 in relation to water quality matters.
159. Dr MacKenzie concluded that the weight of international evidence suggested that the inherent
toxicity of WBM and SBM constituents to phytoplankton and zooplankton is low and that adverse
effects are further minimised by the rapid flocculation, dilution and dispersal in open ocean
situations.
Increased Turbidity in the Water Column from the Discharge Plume
160. 110 submitters raised concerns with respect to the effects of pollution, amongst other issues, on
biodiversity and the integrity of the marine environment. Ms Jean Kahui16 raised concerns regarding
increased turbidity and the accumulative effects of all the drilling wastes.
161. Dr MacKenzie explained that the reduction of light intensity within the water column from the
discharge of drill cuttings and muds could have a localised negative effect on phytoplankton
photosynthesis. However, he concluded that any effects will be minor given the small volumes
discharged, the depth of the water, the rapid settling of most drill cuttings and the high-energy
environment.
162. Dr MacKenzie noted that the drill cuttings and muds are discharged at a depth of 10 m and that the
turbidity plume is not visible at the surface. The discharge and dispersal modelling data presented by
Dr McComb showed that the concentration of total suspended solids in the water column “rarely
exceeded the natural background value of 0.2 g/m3 or extended beyond 500 m from the point of
discharge”. Because the concentration of suspended solids was only slightly increased in the near
vicinity of the discharge, Dr MacKenzie concluded that the effect on water column turbidity is
expected to be small.
163. Finally, Dr MacKenzie identified that the total volume of drill cuttings and muds (including fluids)
discharged over the entire drilling period (420 days) is estimated to be in the order of 7,000 m3. He
considered that this volume is very small in comparison to the volume of water within the euphotic
15 Environmental Scientist for REM on behalf of OMV New Zealand Limited. 16 Submission number 110377 and on behalf of Frack Free Kapiti – submission number 110375.
33
zone that will flow through the ENSCO 107 over the drilling period. On this basis, he concluded that
the effect on water column turbidity (and hence phytoplankton productivity) is expected to be
negligible. Furthermore, given the natural sources of turbidity in the wider environment (such as
sediment re-suspension in the surf zone, tidal mixing in high current areas, plumes from local rivers
and phytoplankton blooms), Dr MacKenzie concluded any cumulative effects on turbidity in the wider
context of the South Taranaki Bight would be so small as to be immeasurable.
5.3.3 Findings
164. Having considered the information available, submissions and evidence, we find the following in
respect to the potential adverse effects of the drilling programme on plankton communities:
(a) We accept the evidence of Dr MacKenzie that the inherent toxicity of WBM and SBM
constituents to phytoplankton and zooplankton communities is low.
(b) Whilst we acknowledge the concerns of submitters regarding the toxicity of the waste
material discharged, we accept the evidence that the metals/metalloids in drilling fluids and
cuttings are not bioaccumulated by marine organisms and do not present a hazard to marine
food webs.
(c) The total volume of drill cuttings and muds discharged over the course of the drilling
programme will be so small as to be immeasurable compared with the sediment sources
entering the South Taranaki Bight from the surrounding environment. The effects, including
cumulative effects, on water column turbidity and phytoplankton productivity will be
negligible.
(d) The discharge and dispersal modelling data presented shows that the concentration of total
suspended solids in the water column will rarely exceed natural background values or extend
beyond 500 m from the WHP. Any potential effects associated with the discharge of drill
cuttings and muds will be further minimised by the rapid flocculation, dilution and dispersal
that will occur in the open ocean.
(e) The South Taranaki Bight is a highly dynamic and biologically productive region. The
upwelling and mixing processes result in a good supply of nutrients to fuel phytoplankton
productivity. The Kahurangi upwelling has a major effect that at times directly influences the
water column and plankton communities over the permit area. We accept the conclusion of
Dr MacKenzie that any potential effects from the drilling programme on nutrient dynamics
and plankton productivity will be minor.
5.3.4 Conditions
165. Conditions have been proffered by OMV, and recommended by the EPA, with respect to the
management and monitoring of the potential effects of the drilling programme on planktonic
communities. We have carefully considered these conditions and have decided to impose the
following conditions in relation to planktonic communities: Conditions 16, 17, 18, 19, 20, 21, 33 and
34.
34
5.4 Marine Mammals
5.4.1 The Issues
166. The key potential adverse effects on marine mammals are:
(a) noise and vibration from the drilling operations and support services;
(b) the discharge of drill cuttings and muds into the water column (including potential effects on
prey availability and foraging);
(c) the deposition of drill cuttings and muds onto the seabed; and
(d) the potential for ship strike and marine mammal migration issues.
5.4.2 The Effects
Noise and Vibration
167. 123 submissions raised concerns about the effects of the drilling programme on marine mammals,
particularly Hector’s dolphins and blue whales. Many of these submissions raised concerns about
the potential effect of an oil spill on marine mammals. Submitters such as Ms Liddle raised concerns
regarding the effects of noise on marine mammals.
168. Dr Simon Childerhouse17 stated that the area of interest is unlikely to be of particular biological
importance to any marine mammal species, although many species are likely to be present in the
broader area at certain times of year. He noted that noise from the drilling programme will be audible
to baleen whales, beaked whales and dolphins and that the frequency of the main noise energy from
drilling overlaps with baleen whales and the lower frequency end of dolphin sensitivity. He concluded
that, given most of the noise energy is in the lower frequencies, it is more likely to affect blue whales
rather than Hector’s dolphins.
169. Dr Childerhouse concluded that, while there may be some potential adverse noise effects, they will
only occur within the immediate vicinity of the WHP (within 200 m) and that any overall risks were
minor. He noted this conclusion is consistent with findings of the OSPAR Convention Report (2009),
in that injuries from noise from drilling operations are unlikely in marine mammals, except very close
to the source. A temporary threshold shift will only occur for cetaceans if they remain within 1 m of a
drilling operation for periods of approximately 10 minutes. Permanent threshold shifts will only occur
for high-frequency cetaceans if they remain within 1 m of the drilling operation and for periods of
more than 10 minutes;
170. Associate Professor Elizabeth Slooten18 stated that she had concerns about the lack of data on
the noise made by drilling platforms in New Zealand waters and that there is considerable
17 Senior Research Scientist at Blue Planet Marine on behalf of OMV New Zealand Limited. 18 Associate Professor in the Department of Zoology at the University of Otago on behalf of Climate Justice Taranaki and others.
35
uncertainty about the noise that would be produced and how audible it would be to marine mammals.
She stated that Dr Childerhouse’s assessment had ignored the fact that marine mammals also use
passive listening to interpret their environment.
171. Associate Professor Slooten stated that OMV had not provided any evidence of habituation of
marine mammals to the existing mining/drilling operations in the area and that a minimum of three
years of research would be required in order to describe biological and physical processes in the
area to be drilled.
172. Dr Childerhouse’s supplementary evidence stated that any significant sound energy from deep sub-
surface explosions will be unlikely to propagate from the source of the explosion into the water
column. He concluded it will not pose any risk to marine mammals.
Discharge of Drill Cuttings and Muds
173. 123 submissions raised concerns about effects on marine mammals, particularly Hector’s dolphins
and blue whales. Many of these submissions are concerned about the potential effect of an oil spill
on marine mammals. Others expressed concerns regarding the effects of the discharge of drill
cuttings and muds on the food sources of marine mammals and associated impacts on the health
and wellbeing of Hector’s dolphins.
174. Ms Tiernan said a consequence of discharging drill cuttings and muds was that elevated
concentrations of metals and metalloids such as chromium, copper, lead and zinc may be observed
for distances up to 250 m from the WHP. She stated that such water quality effects are likely to be
localised and short term given the mitigation measures in place to treat and to re-use drilling muds
where possible and the intermittent nature of the discharge of muds at the completion of each well.
She concluded that the discharges from the WHP are not likely to have an adverse impact on pelagic
marine life.
175. Ms McConnell considered the effect of increased turbidity and contamination on marine mammals
and noted that, because marine mammals return to the surface to breathe, the primary pathway for
direct uptake is through contaminant contact with the skin and mucous membranes or via secondary
ingestion during feeding. Although Ms McConnell noted that direct contact is feasible, she concluded
that the potential for adverse effects on marine mammals will be minimal for the following reasons:
(a) Dilution rates are such that concentrations of total suspended sediments and associated
contaminants will decrease rapidly with distance from the WHP.
(b) Modelling of metal concentrations from the discharge plume do not exceed the ANZECC
standards for water quality at the WHP.
(c) Modelling of total suspended sediments indicated that background concentrations rarely
extended beyond 500 m from the WHP.
(d) Marine mammals have ample opportunity to avoid the discharge plume as they are highly
mobile and the WHP is open to the ocean on all sides.
36
(e) No species of marine mammal is entirely dependent on habitat in the direct vicinity of the
WHP.
176. Ms McConnell noted that the potential indirect effects of increased turbidity on marine mammals
include reduced foraging efficacy and reductions in prey availability. Given that the plume modelling
by Dr McComb indicated that suspended sediment levels exceeding background concentrations will
seldom occur, Ms McConnell concluded that these effects are likely to be highly localised and of
minor significance.
Deposition of Drill Cuttings and Muds
177. Submitters expressed concern regarding the potential effects of the deposition of drill cuttings and
muds on the food sources of marine mammals and associated impacts on the health and wellbeing
of Hector’s dolphins.
178. Ms McConnell stated that the deposition of drill cuttings and muds will not have any direct effects on
marine mammals, as marine mammals that forage on the benthos are not permanently associated
with the seabed and can move away from affected areas.
179. Ms McConnell concluded that the indirect effects from the deposition of drill cuttings and muds do
not pose any significant concerns with regard to food chain effects. She noted that no marine
mammals present in the area rely exclusively on benthic prey for all of their nutritional requirements,
that the area of benthos that will covered by drilling waste is relatively small and that the benthic prey
sought by marine mammals will most likely be the larger mobile epifauna species that are more
resilient to deposition.
Presence of the ENSCO 107 and Support Vessels
180. 110 submitters raised concerns with potential effects of the drilling programme on biodiversity and
the integrity of the marine habitat. Some of these submitters specifically raised concerns with respect
to the issue of ship strike on marine mammals.
181. Ms McConnell discussed the potential effects of helicopter disturbance to seal colonies and that
helicopters have been documented to elicit behavioural changes in whales. She was unable to locate
any specific studies on the behavioural response of whales to aircraft but noted that some
behavioural effects on whales can be expected during close approaches by aircraft. She stated that
care needs to be taken by pilots operating in areas where marine mammals may be present and
noted that the Marine Mammals Protection Regulations 1992 address appropriate aircraft behaviour
around marine mammals.
182. Ms McConnell addressed ship strike and stated that blue whales are most at risk given their size and
their frequent presence near the WHP. She noted that all cetacean species are potentially at risk
from ship strike; however, large whales are at greater risk due to their more limited mobility. She
noted that two support vessels (Pacific Worker and Pacific Ranger) will support the drilling
programme. Vessel movements will increase from one return trip per week between New Plymouth
and the WHP to two and a half return trips per week. Ms McConnell considered that this represented
37
a very small increase in the potential risk of a ship strike incident, particularly given the shipping
routes off Taranaki and high levels of shipping traffic in the area around the WHP. She noted the
efficient operating speeds of the Pacific Worker and Pacific Ranger are below 14 knots, which
significantly decreases the risk of ship strike.
183. Associate Professor Slooten did not provide any evidence on the effect of ship strike in relation to the
drilling programme. She suggested that the cumulative effects of the drilling programme, along with
all other existing activities, should be considered.
5.4.3 Findings
184. Having considered the information available, submissions and evidence, we find the following in
respect to the potential adverse effects of the drilling programme on marine mammals:
(a) Although Associate Professor Slooten gave expert evidence, we found that she crossed the
line into advocacy at times. She avoided answering direct questions on the potential effects
on the Hector’s dolphin population if this application for marine consent was refused.
Instead, she speculated on a possible increase in the population if human activities did not
increase and fishing activities were eliminated along the west coast of the North Island. She
made a number of general statements and did not focus on the potential effects of the drilling
programme itself.
(b) We accept the evidence of Ms McConnell with respect to the summary of marine mammal
species that could be present in the South Taranaki Bight. We note that Ms McConnell,
Associate Professor Slooten and the Ministry for Primary Industries agree that the WHP is at
the extreme southern limit of the known habitat of the Maui’s dolphin sub-species. We also
note agreement that the water depth at the WHP and its distance offshore are outside the
known preferred habitat of Hector’s dolphins. We accept these animals might occasionally
visit the area.
(c) We accept the South Taranaki Bight is a foraging area for blue whales (Antarctic blue whale
and pygmy blue whale) and, as such, that the area should be considered to be habitat of a
threatened species in accordance with section 59(2)(e) of the EEZ Act. While Ms McConnell
was initially reluctant to concede that the South Taranaki Bight was habitat for this
threatened species, she stated in her supplementary evidence that the International Union
for the Conservation of Nature classification of blue whales (including Antarctic blue whale
and pygmy blue whale) is endangered.
(d) There is an absence of empirical data in the noise assessment by Dr Childerhouse, but we
accept that the assumptions used in his assessment are conservative and can be relied
upon in these circumstances as the best available information. However, given the lack of
empirical data regarding actual noise levels during operations, we conclude that
measurement is required in order to validate the assessments and confirm that actual noise
levels are within the assumed range described in the evidence of Dr Childerhouse. We
38
encourage OMV to discuss with Cawthron Institute the possibility of including underwater
noise level recordings as a part of their Offshore Taranaki Environmental Monitoring
Programme (OTEMP).
(e) The assessment of Dr Childerhouse indicated that the acoustic footprint of the drilling
programme would be much smaller than that of activities that are already permitted in the
area, such as seismic surveys.
(f) We accept the conclusions of Dr Childerhouse that cetaceans and pinnipeds will only show
significant behavioural responses at distances closer than 200 m from a drilling operation
and will not be affected further than 200 m.
(g) We accept the conclusion of Ms McConnell that further marine mammal surveys would be
unlikely to confirm the distribution of the Maui’s dolphin sub-species beyond the 12 years’
worth of survey data that already exists. We accept that she has used the best available
information without incurring unreasonable cost, effort or time for her assessment of
environmental effects.
(h) Potential cumulative effects on marine mammal fatalities associated with ship strike from
support vessels to the drilling programme will be very low given the very small increase in
vessel movements, the size of the vessels and their speed.
(i) We accept the conclusion of Ms McConnell that the deposition of drill cuttings and muds will
not have any direct effects on marine mammals, and we accept that marine mammals that
forage on the benthos are not permanently associated with the seabed and can move away
from any areas that may be affected by deposition.
5.4.4 Conditions
185. Conditions have been proffered by OMV, and recommended by the EPA, with respect to the
management and monitoring of the potential effects of the drilling programme on marine mammals.
We have carefully considered these conditions and have decided to impose the following conditions
in relation to marine mammals: Conditions 17, 18, 19, 21, 23, 25, 26, 27, 29, 30, 31, 32, 33 and 34.
5.5 Seabirds
5.5.1 The Issues
186. The key potential adverse effects on seabirds are:
(a) collision with structures via the attraction to artificial nocturnal lighting; and
(b) impacts on food sources and foraging from the discharge of drill cuttings and muds into the
water column.
39
5.5.2 The Effects
187. Submitters expressed concern about the potential loss of marine habitat and the degradation of the
marine environment. Some submitters expressed specific concern about potential adverse effects on
seabirds, including penguins.
188. Dr David Thompson19 stated that the “additional artificial nocturnal lighting” from the drilling
programme represent the most significant risk to seabirds. However, he concluded these changes
will have “very minimal” impacts on seabirds. He noted that the Department of Conservation had
confirmed that only one or two seabird collisions are reported annually and that no reports had been
received “in many years” from the offshore oil and gas industry in Taranaki.
189. Dr Thompson concluded that any potential risks to seabirds from the effects of the discharge of drill
cuttings and muds are negligible. Increased water turbidity may reduce the foraging efficiency of
diving seabirds that rely on visual foraging to capture prey from the water column. He considered this
to be an insignificant threat to foraging seabirds as the location of the WHP is probably beyond the
preferred foraging range of coastal species. He stated that it is not known to what extent foraging
seabirds are dependent upon particular areas that may be affected by the discharge of drill cuttings
and muds into the water column but noted that the displacement of seabirds to unaffected or less
affected areas nearby is unlikely to have a significant impact either at the individual or population
level.
190. The submission of Mr Paul Elwell-Sutton20 sought a requirement that seabird observations (species
and abundance) be part of any proposed monitoring in the vicinity of the WHP. Dr Thompson stated
that the resources required to gather this information would be relatively large given the relatively low
level of effects on seabirds. He concluded that it is very unlikely that such information would
substantially alter the mitigation approaches proposed.
5.5.3 Findings
191. Having considered the information available, submissions and evidence, we find the following in
respect to the potential adverse effects of the drilling programme on seabirds:
(a) We agree with Dr Thompson that any potential adverse effects on seabirds from the drilling
programme will be negligible at an individual and population level.
(b) We agree that a regional seabird survey is not needed. We consider this would be
unreasonable given the low potential risk.
5.5.4 Conditions
192. Conditions have been proffered by OMV, and recommended by the EPA, with respect to the
management and monitoring of the potential effects of the drilling programme on seabirds. We have
19 Seabird Ecologist at NIWA appearing on behalf of OMV New Zealand Limited. 20 Submission number 110456.
40
carefully considered these conditions and have decided to impose the following conditions in relation
to seabirds: Conditions 15, 26, 33 and 34.
5.6 Fish
5.6.1 The Issues
193. The key potential adverse effects on fish are:
(a) noise and vibration from the drilling operations and support services;
(b) the discharge of drill cuttings and muds into the water column and associated changes to
water quality; and
(c) the deposition of drill cuttings and muds onto the seabed.
5.6.2 The Effects
194. 59 submitters opposed the drilling programme on the basis that it would have possible negative
effects on fisheries. 110 submitters raised concerns about the effects of the drilling programme on
fish breeding. Ms Catherine Cheung21 expressed concern over the risks posed to fisheries.
195. Dr MacDiarmid stated that it is reasonable to expect some masking by rig noise of individual fish
calls in the vicinity of the WHP. However, given the principal sound-producing fish in the area (red
gurnard) are mobile and widely distributed, she concluded that any potential noise effects on the
gurnard population in the South Taranaki Bight are likely to be negligible.
196. Dr MacDiarmid concluded that it is “highly unlikely” that the discharge and deposition of drill cuttings
and muds will have a measurable impact on fish species. She cited the comparatively small quantity
of drill cuttings and muds discharged. Half of the drill cuttings and muds are expected to be
deposited on the seabed within 5 km of the WHP. Only a small volume of mostly fine material is
expected to be carried more than 40 km down current, and the discharge is estimated to rarely
exceed the natural background concentrations of total suspended sediments.
197. Dr MacDiarmid stated that the discharge and deposition of drill cuttings and muds will not have
significant effects on drifting planktonic fish eggs and larvae, as these will quickly pass through the
relatively small discharge plume.
5.6.3 Findings
198. Having considered the information available, submissions and evidence, we find the following in
respect to the potential adverse effects of the drilling programme on fish:
21 Submission number 110357.
41
(a) We agree with Dr MacDiarmid that any adverse effects of noise and the discharge/deposition
of drill cuttings and muds on fish species will be negligible and that fish have the ability to
move away from the discharge plume.
(b) The discharge/deposition of drill cuttings and muds will not have significant effects on drifting
planktonic fish eggs and larvae.
5.6.4 Conditions
199. While no conditions were proffered by OMV, or recommended by the EPA, in relation to the direct
management of the potential effects of the drilling programme on fish, a number of conditions were
recommended that relate to matters that are generally relevant to the management of fish. We have
carefully considered these conditions and have decided to impose the following: Conditions 16, 17,
18, 19, 20, 21, 33 and 34.
5.7 Biosecurity
5.7.1 The Issues
200. The key potential biosecurity issues are the introduction of unwanted organisms via the ENSCO 107
and the discharge of ballast water from support vessels.
5.7.2 The Effects
201. No submitters raised biosecurity matters as a key issue.
202. Dr Barrie Forrest22 advised that the Ministry for Primary Industries (MPI) is satisfied that the ENSCO
107 meets its standards for bio-fouling, ballast water and sediments. Given the high level of
biosecurity risk reduction that has been achieved, he concluded that there are no biosecurity
concerns with the deployment of the ENSCO 107 for the drilling programme.
203. Dr Forrest stated that the support vessel Pacific Worker was not subject to the same level of bio-
fouling risk reduction as the ENSCO 107 but noted the MPI assessment was that any risks were
“acceptable” and met their Craft Risk Management Standard for bio-fouling. He also stated that
Pacific Worker was required to meet related border standards for ballast water and associated
sediment, and accordingly, he concluded that there are not any significant biosecurity risks
associated with the use of Pacific Worker.
204. MPI also advised in its letter to the EPA (1 August 2014) that it is satisfied that the ENSCO 107 and
Pacific Worker have carried out the measures described in the Craft Risk Management Plans and
are not carrying any risk organisms from overseas.
205. Dr Forrest noted that, in the unlikely event that OMV brings an additional vessel from overseas to
support the development drilling programme, it must meet the Import Health Standard for ballast
22 Senior Marine Ecologist at the Cawthron Institute appearing on behalf of OMV New Zealand Limited.
42
water and associated sediment. We understand that OMV would support the vessel owner in
ensuring compliance with the Craft Risk Management Standard for bio-fouling, even though
compliance is not mandatory until 2018.
5.7.3 Findings
206. Having considered the information available, submissions and evidence, we find the evidence of Dr
Forrest was thorough, and we accept that appropriate risk reduction measures have been
undertaken. We also acknowledge that MPI has advised that it is satisfied that the ENSCO 107 and
Pacific Worker have carried out the measures described in the Craft Risk Management Plans.
5.7.4 Conditions
207. No conditions were proffered by OMV, or recommended by the EPA, in relation to the management
of biosecurity risks. We consider it appropriate to impose a condition requiring compliance with the
Craft Risk Management Standard – Biofouling on Vessels Arriving to New Zealand, 15 May 2014.
We are aware that compliance with this standard is voluntary until 2018. Therefore, we consider it
appropriate to avoid and minimise any biosecurity risk by imposing Condition 24.
5.8 Existing Interests
5.8.1 The Issues
208. The key potential adverse effects on existing interests are:
(a) the temporary loss of access to fishing grounds as a result of the presence of the ENSCO
107 and support structures/vessels;
(b) the discharge and deposition of drill cuttings and muds affecting primary production, which,
in turn, may affect fish abundance;
(c) the potential for contaminants in the drill cuttings and muds to accumulate in fish;
(d) the presence of the ENSCO 107 and support structures/vessels creating a potential
navigational hazard; and
(e) the existing interests of Māori in the EEZ, being lawfully established existing activities, rights
and practices. The drilling programme has the potential to affect these interests and access
to the fishery quota derived from the Treaty of Waitangi (Fisheries Claims) Settlement Act
1992.
5.8.2 The Effects
Fishing Interests
209. We received no evidence of potential effects on recreational fishing, so we have focused the
discussion in this section on commercial fishing interests. 59 submitters stated that the application
for marine consent should be refused due to possible adverse effects on marine fishing.
43
210. The Impact Assessment and the EPA Staff Report stated that the loss of access to fishing grounds
will be temporary and cover a small area. Both reports stated the discharge and deposition of drill
cuttings and muds will not adversely affect primary production and, therefore, will not affect
commercial fish populations.
211. The Ministry for Primary Industries had concerns that the drill cuttings and muds may contain
polychlorinated biphenyls (PCBs) and that these could enter the food chain of commercially
harvested fish, leading to potential bioaccumulation. Mr Barker confirmed that there are no PCBs in
the drill cuttings and muds used as part of the drilling programme, and Mr Asher noted that the use
of PCBs is banned in New Zealand. Therefore, PCBs will not enter the food chain.
212. OMV proposes to remove the well casing below the seabed in accordance with the Health and
Safety in Employment (Petroleum Exploration and Extraction) Regulations 2013 and the Crown
Minerals (Petroleum) Regulations 2007 regarding well abandonment. This means that there will be
no structures left on the seabed that could pose a hazard to commercial fishing activities.
Commercial Shipping
213. The Impact Assessment stated that the Maari field is within the Taranaki Precautionary Area
established by the International Maritime Organisation. This requires all ships travelling through this
area to navigate with particular caution given the high level of offshore petroleum activity. Maritime
Chart NZ 48 (Western Approaches to Cook Strait) also advises that “all ships should navigate with
particular caution in order to reduce the risk of marine pollution in the precautionary area”.
214. The Impact Assessment stated that the ENSCO 107 and support vessels have automatic
identification system technology, which allows their position to be monitored by other vessels. The
International Maritime Organisation also requires all vessels operating in the precautionary area to
be fitted with automatic identification system technology as a primary collision avoidance tool.
215. The Impact Assessment stated that OMV will follow international law and the requirements of the
Maritime Transport Act 1994 in order to prevent collisions. Mr Barker said that OMV has issued a
Notice to Mariners of the hazard to shipping and noted an existing 500 m safety zone is in place
around the ENSCO 107, preventing any vessels from entering this zone.
Māori Interests – OMV
216. OMV stated that they do not believe there is any requirement to consult with iwi under the EEZ Act.
In his evidence, Mr Zeilinger confirmed that OMV prides itself on consulting with affected parties
even where it is not legally required to.
217. OMV listed the iwi consultation undertaken in the Impact Assessment, noting that, although the WHP
was in the Ngāti Ruanui rohe, they had consulted with seven other iwi, including the Taranaki Iwi
Trust. In his closing legal submissions, Mr Duncan Laing23 confirmed through a statement by Mr
23 Counsel for the applicant.
44
Robert Dobbins24 that OMV’s consultation is ongoing and that, in the lead-up to the marine consent
application, OMV contacted 18 iwi and met with all who were willing to meet.
218. OMV concluded in the Impact Assessment that, while there are coastal areas that are of high cultural
importance to Māori for collecting marine resources and protection of spiritual values, OMV does not
consider that there are any customary areas or sites of heritage significance. They further concluded
that there will be no adverse effects from the ancillary activities of drilling on cultural interests other
than those specified elsewhere in the Impact Assessment.
Māori Interests – NKTT Report
219. NKTT outlined the importance of the relationship that Māori draw from Te Tiriti o Waitangi (the Treaty
of Waitangi). They explained the principles of partnership, active protection and rangatiratanga. The
report noted the unique relationship Māori have as Tiriti o Waitangi partners and the impact that
binding decisions can have on their ability to be afforded their treaty rights and practices. NKTT
recommended that we consider the proposed activities in terms of consistency with the principles of
Te Tiriti o Waitangi.
220. The NKTT report warns that the potential cultural impact on iwi and individual Māori covers a wide
spectrum beginning with the potential to alter cultural behaviour, the loss of tribal mātauranga, the
inability to manage and protect the mauri of the moana and kaimoana and an erosion of cultural
identity. NKTT stated that others might see the isolated location of the proposed activity as one of
lesser relevance, but Māori do not apply a spatial restriction on the ocean and instead respect it as a
whole. NKTT noted that many people were lost and drowned over time in these waters, therefore the
seabed is considered a wāhi tūpuna (ancestral site) aligned to the whakapapa and identity of the
people who remain.
221. The Impact Assessment noted that OMV has undertaken extensive consultation and developed good
relationships with Ngāti Ruanui, Ngā Ruahine and the Taranaki Iwi Trust and that they are committed
to developing these relationships into the future. However, NKTT stated that consultation has not
been consistent and meaningful with all affected iwi or their agents and that the breadth and
technical complexity of the application has highlighted capacity and capability issues within iwi and
individual Māori. They stated that these issues need to be addressed by the applicant and EPA to
improve better engagement with iwi and Māori in this process.
222. NKTT stated that the primary economic interest of Māori in this application for marine consent is in
relation to fisheries and its contribution to Māori development generally. Fisheries revenue is often
the main source of income for many iwi. Their reliance on the fishing industry is significant. NKTT
advised that Māori have the potential to gain economically from the drilling programme but noted that
the Impact Assessment does not quantify these potential benefits.
24 OMV Maari Asset Manager.
45
223. NKTT concluded that the drilling programme is unlikely to significantly impact the economic interests
of Māori but noted that an oil spill event may affect commercial stocks of fish, which would impact on
the availability of these “treaty assets”. They recommended that we give sufficient weight to the risks
and consequential effects and to the right of iwi to develop economic opportunities and manage their
sustainable tribal growth.
Māori Interests – EPA Staff Report
224. The EPA Staff Report also provides a useful discussion on Māori interests, cultural activities and
cultural associations. The report states that there are lawfully established cultural activities that
continue to be exercised either separately or in association with iwi fisheries interests such as
kaitiakitanga, rangatiratanga and the maintenance of mātauranga Māori. These concepts are
associated with preserving Māori fisheries interests, the right of iwi to make decisions and act on
issues affecting their fisheries interests and the system of knowledge associated with Māori
commercial and customary fishing activities.
225. The EPA Staff Report states that Māori cultural interests in the marine environment do exist, that
such interests underpin and are inextricably linked to existing interests recognised in the EEZ Act
and that traditional Māori activities are protected under the Treaty of Waitangi.
226. The EPA Staff Report concluded that the drilling programme is “unlikely” to have an impact on
whakapapa and mātauranga Māori. However, it noted that a significant oil spill would affect the
ability for Māori to continue to undertake their cultural practices in the area. This would lead to a loss
of knowledge and association.
227. Overall, the EPA Staff Report concluded that the risk of adverse effects on rangatiratanga,
kaitiakitanga and mātauranga Māori from the drilling programme is likely to be low.
228. The EPA Staff Report presented information on the Treaty of Waitangi (Fisheries Claims) Settlement
Act 1992. It stated that the risk of an oil spill represented a potentially significant impact to the rights
of Māori afforded by this settlement.
Māori Interests – Public Submissions
229. Public submissions on this matter were limited but noted the historical, environmental, cultural and
spiritual relationships that Māori have with this area. They noted the importance of protecting and
preserving the integrity and sustainability of our ocean and coastal waters, sea mammals, fisheries
and all who whakapapa and connect to the area. The well known Whanganui proverb was presented
as an illustration of this relationship: Mai i te kāhui maunga ki Tangaroa, ko au te awa, ko te awa ko
au. From the mountains to the sea, I am the river, the river is me.
5.8.3 Findings
230. Having considered the information available, submissions and evidence, we find the following in
respect to the potential adverse effects of the drilling programme on existing interests:
46
(a) Any potential adverse effects of the drilling programme on fishing and commercial shipping
will be temporary and negligible and are existing given the 500 m exclusion zone in place
around the WHP.
(b) We acknowledge the key potential issues identified in the NKTT Report, EPA Staff Report
and submissions and the importance of both customary and commercial fishing (and the
linkages between them). We particularly note that the customary concerns include ensuring
the continued access to customary fishing grounds, the sustainability of the customary
fishing grounds or mahinga kai and the continued quality and quantity of kaimoana and the
exercise of Māori rights to customary fishing in their rohe.
(c) No other existing activities have been identified as being potentially affected by the drilling
programme.
(d) While it is acknowledged that the duty to consult under the EEZ Act is not a legal
requirement, there is an expectation that appropriate consultation with iwi must occur. This is
consistent with the principles of the Treaty of Waitangi. The site is a cultural site of
significance for iwi, and in order for them to undertake their kaitiakitanga responsibilities, to
protect the mauri of the area and to maintain their mana, they must be kept informed on an
ongoing basis of activities in a timely and meaningful way. This should include all iwi and
Māori entities that may be affected by the drilling programme.
5.8.4 Conditions
231. No conditions were proffered by OMV, or recommended by the EPA, with respect to the
management of the potential effects of the drilling programme on existing interests.
5.9 Oil Spills
5.9.1 The Issues
232. Oil and gas development is a highly complex operation, and there are multiple and significant risks to
be managed. Offshore oil and gas operations are particularly challenging and require industry best
practices, technologies and safeguards that are robust, well tested and continually improved. If they
are to be well managed, these activities must be carried out by organisations with experience,
expertise, operational capability and access to substantial financial and intellectual resources.
233. As noted extensively in the submissions and expert evidence, an oil spill event has the potential to
cause widespread and significant adverse environmental effects. The key potential environmental
risks with respect to oil spills come from:
(a) fuel spills from support vessels, including the loss of inventory between support vessels and
the ENSCO 107; and
47
(b) major oil spills resulting from the loss of well control and multiple protective equipment
failures.
234. We consider a major oil spill from the loss of well control constitutes the most significant risk to the
environment.
235. Mr Welsh explained that the National Oil Spill Response Strategy sets the overarching framework for
the response of Maritime New Zealand and other parties to a marine oil spill event of any size. He
noted that the National Oil Spill Response Strategy includes the New Zealand Marine Oil Spill
Response System, which includes a three-tiered response approach. He outlined the three-tiers are:
(a) Tier 1 oil spills, which are the responsibility of the operator (a fuel spill from a support vessel
is likely to be a Tier 1 spill and would be resolved by OMV);
(b) Tier 2 oil spills, which are the responsibility of the relevant regional council where the spill
occurs in the CMA; and
(c) Tier 3 oil spills, which are generally more complex, of longer duration and have a greater
impact on the environment. A Tier 3 oil spill is the responsibility of Maritime New Zealand,
who coordinate the response under the National Marine Oil Spill Contingency Plan.
236. Mr Welsh explained that oil spill contingency planning is not new to New Zealand and that Maritime
New Zealand has been committed to maintain national and site-specific response systems since
1994. He concluded that the three-tiered oil spill response system utilised within New Zealand is well
established and that the National Oil Spill Response Strategy “will ensure that a spill response is
able to be carried out safely and efficiently whilst minimising the impact of oil pollution on the marine
environment”.
237. Mr Nigel Clifford25 said that part of the management response to address the potential risks
associated with oil and gas development involved not letting companies into the New Zealand
environment who don’t have appropriate capabilities and experience. He stated that they need to be
good corporate citizens, meet their liabilities and have a proven track record of delivering what they
promise before they are approved by Maritime New Zealand. He noted that operators must have a
financial assurance that a minimum amount of money will be available from a third party to meet
liabilities under the Maritime Transport Act 1994. These are Part 26A liabilities, which include strict
liability for clean-up costs and liability for damage.
238. Mr Clifford explained that the challenge with respect to oil spill response capabilities centred on
balancing “likelihood” against “consequence” and that, while the worst-case scenario events that
have been seen around the world are highly unlikely, they do have massive consequences. He noted
that the oil spill response systems around the world work on a “first strike/immediate response”
capability and then build to whatever level of response is required. He said that, with the possible
exception of the United States of America, no nation in the world holds all the equipment and
25 General Manager – Safety and Response Services at Maritime New Zealand.
48
resources needed to deal immediately with a major deep water well blowout. He said that
international response resources are owned by Oil Spill Responses Limited and are centralised in
Singapore and that OMV is required to maintain membership to this organisation.
239. Mr Clifford shared the lessons learned by Maritime New Zealand following the MV Rena event and
noted that, while the response was adequate, communication with the affected communities in the
first few days following the grounding and oil spill could have been better. He noted that
communication could have been quicker, clearer and more open so that people understood the
response and lines of responsibility.
240. Mr Wayne Vernon26 advised that the Safety Case for oil wells requires a Well Examiner’s Certificate
to confirm that the wells are properly designed, constructed and operated in an appropriate manner.
He stated that WorkSafe New Zealand’s consideration of well integrity does not include any
evaluation of environmental matters and that this is a key mechanism in order to avoid the potential
environmental effects associated with a well blowout. We return to this matter in sections 11 and 13
of this decision.
5.9.2 The Effects
241. The Impact Assessment noted that fuel spills from support vessels have a higher probability of
occurring than a major oil spill event from the loss of well control. However, it acknowledged that the
potential environmental effects of a major oil spill event are much greater. This was supported by the
evidence of Maritime New Zealand. Accordingly, the following sections focus on the potential
environmental effects of a major oil spill event.
242. A summary of the potential environmental effects resulting from a fuel spill is provided in Table 21 of
the Impact Assessment.
243. 110 submitters raised concerns about the potential adverse effects of an oil spill on the environment
and existing interests. The submissions identified the possibility of an oil spill adversely impacting
marine mammals, marine life in general and the economy/livelihood of people.
Trajectory Modelling
244. Dr McComb explained the trajectory modelling of an oil spill release to the sea surface at the WHP.
He outlined that an 11-year historical period was simulated for the spill of oil based on an 11-year
hindcast of the winds and ocean currents for New Zealand. The modelling assumed a worst-case
scenario release of 10,000 barrels per day for 150 days and predicted where the oil would end up
and the time it would take to beach. He highlighted that the model assumed there was no weathering
of the oil and no effective clean-up response. Therefore, there was no reduction in the spill volume
over time.
26 Chief Inspector of Petroleum, Geothermal and Major Hazards for WorkSafe New Zealand.
49
245. Dr McComb noted that oil is most likely to beach in spring and is least likely to beach in autumn.
Conservatively, he stated beaching is likely for 78.1–94.2% of spill events. The minimum time for
beaching ranged from 32.6 hours during winter to 68.2 hours during summer. In all scenarios, the
highest beaching concentrations were found to occur along the coastline from Whanganui to Kapiti.
The Behaviour and Effects of a Major Oil Spill
246. Dr Chris Battershill27 explained that the degree of environmental impact from an oil spill event will
depend on the amount of oil involved, the duration and repetition of exposure, seasonal
characteristics, sea conditions, the geomorphology of the coast where the oil beaches and clean-up
activity (amongst other things). He noted that the MV Rena event provided a useful and recent case
study of the environmental effects resulting from a moderate oil spill event.
247. Dr Battershill said that a lesson learned from the MV Rena event was that there needed to be faster
responses to sites of sensitivity and conservation significance (such as booming off habitat areas
around the Manawatu Estuary) and that these values should be identified before an event occurs.
248. Mr Clifford stated that the adverse environmental effects of the cargo of the MV Rena were greater
than the adverse effects of the fuel oil spill.
The Effects of Oil Spills on Plankton Communities
249. Dr MacKenzie stated that there have been numerous studies on the effect of major oil spills on
plankton communities and that these studies have found varying effects on the plankton. He stated it
is difficult to distinguish natural variability from oil spill effects but that minor effects were found in a
number of studies. He noted that, in some cases, phytoplankton biomass and productivity had an
initial decline but had then reached higher levels after the oil spill event, which was possibly due to
decreased zooplankton grazing pressure.
Effects on Wildlife (Mammals and Seabirds)
250. The potential effects of an oil spill event on wildlife were discussed in Tables 19 and 21 of the Impact
Assessment. Ms McConnell explained the factors that influence the severity of the effects of oil on
wildlife, including (i) the route of exposure, (ii) the duration of exposure, (iii) oil type, (iv) the species
affected, (v) seasonal characteristics and (vi) complicating factors.
251. Ms McConnell concluded that seabirds and the New Zealand fur seals are most at risk of immediate
debilitation from external oiling. She noted that, without treatment and rehabilitation, the chance of
survival of oil-affected individuals is low, due to an immediate reduction in waterproofing and
insulation, which are fundamental to survival in the cold marine environment.
252. Dr Thompson stated that detrimental effects of an oil spill depend upon the scale of the spill, the
movement of the oil following the spill (which will depend on weather conditions at the time) and the
time of year the spill occurred.
27 Chair of Coastal Sciences for the University of Waikato appearing on behalf of OMV New Zealand Limited.
50
253. With respect to shorebirds, Dr Thompson noted that season has a strong effect on the number of
birds present in the area. For example, North Island totals for banded dotterel and wrybill are at least
an order of magnitude higher in winter compared to summer.
Effects on Existing Interests
254. The EPA Staff Report detailed that a major oil spill event may have severe impacts on existing
interests, including impacts on marine resources resulting in income loss, impacts on cultural values,
contamination or loss of food resources (kaimoana and recreational fishing) and impacts on human
health (discussed in section 6 below).
255. Based on the worst-case scenario modelled and documented by Dr McComb, the EPA Staff Report
identified that an oil spill may have the following impacts on persons with an existing interest:
(a) Temporary displacement from commercial fishing grounds.
(b) Temporary displacement from sites of cultural significance, such as kaimoana-gathering
sites.
(c) Reduction in commercial, recreational or subsistence fish stocks.
(d) Contamination of fish stocks and resulting health impacts of consuming contaminated
species.
(e) Contamination of cultural assets and associated spiritual and economic losses.
(f) Reduction in public access to contaminated areas.
(g) Displacement from coastal shipping routes.
(h) Reduction in tourism due to spill impacts and associated economic losses.
(i) Reduction in air quality in areas contaminated by oil.
Effects on Human Health
256. Dr Battershill addressed the potential human health effects of a major oil spill. He noted that, during
the MV Rena event, a powerful hydrocarbon odour emanated from beached and wave-washed oil
and that, in the more severely inundated parts of the coast, this odour became quite overwhelming.
He explained that marine invertebrates may pick up hydrocarbons depending on the degree of oil
spill inundation along the coast and in shallow subtidal areas and that contamination could potentially
affect people if the marine invertebrates were eaten.
257. Dr Battershill acknowledged that he is not a human health expert when it comes to toxicity of marine
food items to people but noted that, during the peak contamination period for the MV Rena event, the
levels of PAH contamination in marine invertebrates did not exceed New Zealand or Australian limits
of concern for human health, based on advice from the MPI and District Health Boards.
51
5.9.3 Findings
258. Having considered the information available, submissions and evidence, we find the following in
respect to the potential risks and environmental effects of an oil spill event from the drilling
programme:
(a) We accept that the probability of a major oil spill event is extremely low given the mitigation
measures in place, the high level of confidence regarding drilling conditions (known geology
and the use of existing conductor slots), the pressure of the reservoir, the composition of the
oil (requiring the oil to be heated and pumped out) and the operational standards and
procedures in place.
(b) The potential effects of a major oil spill event on the environment and existing interests
would be significant. The adverse environmental effects of the MV Rena event demonstrate
what could happen and how challenging such incidents can be for New Zealand’s national oil
spill response capability.
(c) We are satisfied that Maritime New Zealand and other operators have the plans, structures,
processes, access to equipment and financial resources to respond to oil spill events. We
accept that the responsibilities, operational procedures and policies set out in the National
Oil Spill Response Strategy are continuously reviewed and updated.
(d) We accept that preparedness, planning and training by Maritime New Zealand and operators
can result in more effective and timely containment/control of oil spill events. We consider
this to be a primary mitigation measure.
(e) We understand that significant volumes of oil in the marine environment can be difficult to
recover or contain due to the realities of coastal topography, weather, logistics, responder
safety and limitations on containment equipment specifications and availability. We accept
that response measures are focused on using the best available technology, equipment and
resources to prevent an oil spill from occurring, stopping the amount of oil spilled at the
source of release and preventing any spilled oil from reaching sensitive coastal
environments.
(f) The oil trajectory modelling presented by Dr McComb is helpful in terms of understanding the
spatial characteristics of a major oil spill event from the Maari field and in determining the
coastlines most likely to be adversely affected. We accept that the modelling is not
attempting to characterise a single or typical event. We consider that the modelling of a
release of 10,000 barrels of oil per day for 150 days is extremely unlikely and bordering on
impossible in light of the evidence provided by Dr Zelt. We accept that MetOcean Services
Limited was trying to replicate a worst-case scenario event and the possible impacts of
different events.
52
(g) We accept the evidence of Mr Graeme Lawrie28 and Mr Welsh that the health, safety and
environmental measures employed by OMV conform with best international practice for spill
prevention measures and risk mitigation.
(h) We find that the critical mechanism for mitigation is ensuring well integrity and conclude that
the EPA, Maritime New Zealand and WorkSafe New Zealand all have roles to fulfil in
ensuring well integrity is achieved and maintained throughout the drilling programme. We
consider this matter further in the conditions below and in section 11 of this decision.
(i) We are satisfied that we have sufficient information regarding the risks and effects
associated with an oil spill event. We questioned the relevant experts and advisors from
Maritime New Zealand and WorkSafe New Zealand on this issue. We have particularly relied
upon the evidence of Mr Clifford and Dr McComb on the assessment of risks associated with
an oil spill event.
5.9.4 Conditions
259. We accept that Maritime New Zealand and WorkSafe New Zealand Limited have primary
responsibilities to regulate and apply conditions relating to maritime safety and oil spill preparedness
and response. That said, it is appropriate for any marine consent to address matters relating to the
potential environmental effects of such incidents if necessary and appropriate.
260. Therefore, we consider it appropriate to avoid and minimise any effects on the environment or
existing interests from an oil spill by imposing the following conditions. Conditions 5, 6, 7, 8, 9, 10,
11, 12, 13, 14, 15, 33 and 34.
28 Health, Safety, Security and Environment Manager for OMV New Zealand Limited.
53
Effects on Human Health 6.
6.1 The Issues
261. We are required to take into account effects on human health that may arise from effects on the
environment in accordance with section 59(2)(c) of the EEZ Act. The key potential effects on human
health related to the drilling programme are:
(a) the discharge of drill cuttings and muds into the water column and seabed; and
(b) algae blooms.
262. We acknowledge the health of workers on board the ENSCO 107 is subject to the requirements of
the Health and Safety in Employment Act 1992, which is administered by WorkSafe New Zealand.
6.2 The Effects
6.2.1 Drill Cuttings and Muds
263. The EPA Staff Report noted that there is potential for adverse effects on human health to arise from
the consumption of fish or shellfish that have been exposed to toxic substances discharged in drill
cuttings and muds. The EPA Staff Report outlined that metals such as mercury, cadmium, chromium
and lead are especially toxic to aquatic organisms and humans, and all of these elements are found
in the drill cuttings and muds. The EPA Staff Report noted that bio-concentration and bio-
magnification can result in higher levels of trace metals at the top of the food chain than those found
in the water column or sediment.
264. Ms Tiernan concluded that any environmental effects with regard to human health are likely to be
localised and short term. She noted that metal concentrations in the water column derived from the
residual muds in the drilling fluids are unlikely to have adverse effects on human health based on
compliance with the ANZECC 99% trigger levels at the WHP for most metals.
265. She stated that mitigation measures in place to treat and re-use drilling mud where possible will
minimise potential effects on human health. She noted that the concentrations of hydrocarbons in the
drill cuttings and muds are monitored twice a day to ensure that only those with hydrocarbon levels
less than 100 ppm are discharged. Where hydrocarbon concentrations exceed this figure, the muds
are either diluted with seawater to reduce the concentrations to below 100 ppm or transferred to a
support vessel for discharge at an approved land-based disposal facility.
6.2.2 Algae Blooms
266. Dr MacKenzie explained that frequent blooms of phytoplankton are normal and essential ecosystem
processes. Occasionally, blooms of some micro-algae species that produce natural plant toxins can
lead to contamination of filter-feeding shellfish and make these poisonous to consumers. The record
of toxic algal blooms in New Zealand shows that anthropogenic effects, such as coastal seawater
eutrophication, are not a factor in their incidence in New Zealand.
54
267. Dr MacKenzie informed us that there have been few documented toxic algae events along the coast
of the South Taranaki Bight. This region was affected by widespread blooms of the paralytic shellfish
poisoning dinoflagellate Gymnodinium catenatum in 2000–2003. These blooms of Gymnodinium
catenatum are natural phenomena, and they will probably reoccur at some time in the future. He
concluded that there is no evidence to suggest that past oil drilling activity or the existing oil
production platforms in the Maui and Maari fields are in any way associated with these events.
6.3 Findings
268. Having considered the information available, submissions and evidence, we find the following in
respect to the potential effects of the drilling programme on human health:
(a) We accept the evidence of Ms Tiernan that there will no adverse effects on human health.
We also accept that any metal concentrations in the water column derived from the residual
muds in the drilling fluids are unlikely to have adverse effects on human health.
(b) We are satisfied there is no evidence to suggest that past oil drilling activity or the existing oil
and gas production platforms in the Maui and Maari fields are in any way associated with
toxic algal blooms that have posed a risk to human health along the North Island’s west
coast in the past.
6.4 Conditions
269. We are aware that OMV is required to comply with the Health and Safety in Employment Act 1992,
the purpose of which is to promote the prevention of harm to all persons at work and other persons
in, or in the vicinity of, a place of work. We do not consider that a condition requiring compliance with
this legislation is needed on the marine consent.
55
The Protection of Biological Diversity and Integrity of 7.Marine Species, Ecosystems and Processes
270. We are required to take into account the importance of protecting the biological diversity and integrity
of marine species, ecosystems and processes in accordance with section 59(2)(d) of the EEZ Act.
271. The importance of protecting biological diversity and integrity of marine species, ecosystems and
processes was a key point of concern for 110 submitters. The concerns included effects associated
with oil spills, pollution, noise, ship strike that could impact on biological diversity and the loss of
habitat in the marine environment.
272. Mr Lyndon De Vantier29 stated that the application is incompatible with New Zealand’s national and
international obligations with respect to the conservation and recovery of globally threatened
species. He said that, as a signatory to the Convention on Biological Diversity 1992, New Zealand
should not be developing any further industries in the waters off Taranaki.
273. As set out in section 11 of the EEZ Act, the Act continues or enables the implementation of New
Zealand’s obligations under various international conventions relating to the marine environment,
including the United Nations Convention on the Law of the Sea 1982 and the Convention on
Biological Diversity 1992.
274. We consider there is nothing in these international instruments that would prevent us granting
consent. We do not agree they require any considerations additional to the decision-making criteria
and information principles set out in the EEZ Act.
275. Overall, we find that the expert evidence available to us supports the conclusion that the drilling
programme will not result in any significant or permanent adverse effects on biological diversity,
integrity of marine species, or ecosystems and processes. We consider that benthic macro-fauna
communities are likely to be the most at risk from the deposition of drill cuttings and muds and that
any adverse effects will be small, localised and temporary.
29 Submission number 110371.
56
The Protection of Rare and Vulnerable Ecosystems and 8.Habitats of Threatened Species
276. We are required to take into account the importance of protecting rare and vulnerable ecosystems
and the habitats of threatened species in accordance with section 59(2)(e) of the EEZ Act.
277. The importance of protecting rare and vulnerable ecosystems and the habitats of threatened species
was a key concern for 93 submitters. Submitters said that there was insufficient information on the
potential effects on rare and vulnerable ecosystems and habitats of threatened species. However,
they did not provide any direct examples of the relationship between their concerns and the drilling
programme.
278. Most expert witnesses on behalf of OMV did not specifically address the protection of rare and
vulnerable ecosystems or habitats of threatened species. The issue was only considered by these
witnesses in response to direct questioning.
279. The advice we received from the Department of Conservation (4 August 2014) confirmed that the
New Zealand sea lion and Hector’s dolphin have been declared as threatened species under section
2(3) of the Marine Mammals Protection Act 1978. Ms McConnell and Associate Professor Slooten,
as well as the Ministry for Primary Industries, agreed that the WHP is at the extreme southern limit of
the Maui’s dolphin sub-species. We also note agreement that the water depth at the WHP and its
distance offshore are outside the known habitat preferences of Hector’s dolphins. We accept these
animals might occasionally visit the area.
280. We note the studies of Torres (2013 and 2014) regarding foraging of blue whales (including Antarctic
blue whale and pygmy blue whale) in the South Taranaki Bight. We also note the agreement of
Associate Professor Slooten and Ms McConnell that the International Union for Conservation of
Nature classification of this species as endangered is appropriate.
281. Associate Professor Slooten, Ms McConnell and Dr Childerhouse gave evidence on the potential
adverse effects of the drilling programme on threatened species. We preferred the evidence of Ms
McConnell and Dr Childerhouse. This evidence was specifically focused on assessing the direct
potential impacts of the drilling programme on marine mammals and not generalised statements
regarding the totality of all human-induced impacts on Hector’s dolphins.
282. We find that the drilling programme will not impact on the protection of rare and threatened
ecosystems and habitats of threatened species. We acknowledge that, in the unlikely event of an oil
spill, there would be potential effects on marine mammals that are rare and threatened. We are
aware that the Department of Conservation has advised that a range of legislative regimes and
regulations provide for the protection and conservation of rare and vulnerable ecosystems and
habitats of threatened species. These include the Marine Mammals Protection Act 1978, Wildlife Act
1953, Marine Reserves Act 1971 and Marine Mammals Protection Regulations 1992. The drilling
programme will not interfere with any of the protection measures set out in these legislative regimes
and regulations.
57
The Economic Benefit to New Zealand 9.
283. We are required to take into account the economic benefit to New Zealand of allowing the drilling
programme in accordance with section 59(2)(f) of the EEZ Act.
284. Information on the potential economic benefit of the drilling programme was provided by Mr Zeilinger
and Mr Simon Harris.30 While Mr Zeilinger was able to provide us with useful information
demonstrating the significant economic benefit associated with OMV’s operations and the drilling
programme, we found the evidence of Mr Harris was superficial and not as rigorous as we would
expect.
285. Mr Zeilinger identified the employment opportunities directly generated by the operation of the Maari
field. He said that drilling, engineering and construction activities provide mid-term employment
opportunities for more than 420 full-time staff and contractors and that about 90 other employees
and direct contractors are responsible for the ongoing day-to-day operations of OMV (including
exploration and support functions).
286. Mr Zeilinger said that more than NZ$1.3 billion has been spent on the development of the Maari field
and that more than NZ$400 million has been budgeted for the implementation of the Maari Growth
Project. He noted that more than half of this investment can be classified as local content and that
local engineering companies based in New Plymouth benefit as significant suppliers of the
operations and development drilling programme at the Maari field.
287. OMV has been a major contributor of royalties and taxes. More than NZ$850 million was paid to the
Government by OMV between 2009 and 2013, and the Maari field generated more than NZ$400
million in the same period. Mr Zeilinger stated that the future contribution from the Maari field in taxes
and royalties depends on oil price assumption and well deliverability. He estimated that the Maari
field will generate over NZ$1 billion from this point forward and that approximately 40% of that value
generation can be attributed to the Maari Growth Project.
288. Mr Harris corrected paragraph 67 in his original evidence and stated that it should read
“approximately $1.5 billion in royalties and taxes over the life of the field”. This figure was $1 billion in
his original evidence. Both of these are undiscounted estimates.
289. Mr Harris stated in his supplementary evidence that the net present value of the benefits from
royalties and taxes from the Maari field is NZ$800 million (at an 8% discount rate). His evidence was
that this could range between NZ$750 million (at a 10% discount rate) and NZ$880 million (at a 5%
discount rate).
290. Mr Harris said that a large oil spill would have significant economic costs, particularly clean-up costs
and costs to the fishing and tourism sectors. He stated that the potential damage from a major oil
30 General Manager of Harris Consulting appearing on behalf of OMV New Zealand Limited.
58
spill along the coastline appeared to be greatest for the Nelson-Tasman Region, for which the fishing
and tourism sectors are most important.
59
The Efficient Use and Development of Natural Resources 10.
291. We are required to take into account the efficient use and development of natural resources in
accordance with section 59(2)(g) of the EEZ Act.
292. The EPA Staff Report stated that the Maari field is an existing production field with demonstrated
economic benefit at both a local and national level and is an efficient use and development of
resources.
293. We agree that the drilling programme is an efficient use and development of natural resources. The
drilling programme will use existing conductors and horizontal drilling to undertake the drilling
operation.
294. Dr Zelt said the objective of the drilling programme was to “optimise the efficient use and maximise
the value of the Maari asset by fully developing economic oil accumulations within reach of the
currently installed Maari facilities. The re-development will increase the average production rate of
the field, resulting in a higher overall ultimate recovery, and also target a yet to be developed
reservoir (Maari Mangahewa).”
295. Mr Andrew Annakin31 provided us with details of how petroleum permits are issued under an annual
block offer process in accordance with the Crown Minerals Act 1991. He explained that New Zealand
Petroleum and Minerals monitor the agreed work programme of a permit holder very closely and that
they have the ability to revoke a permit should an operator fail to meet their obligations.
296. We consider there is expectation within the legislative and regulatory regime that permit holders will
seek to explore and develop any natural resources within their permit area. In response to questions,
Mr Annakin agreed that permits were issued on the basis the permit holder would ‘use it or lose it’.
31 Policy Director at New Zealand Petroleum and Minerals.
60
The Nature and Effect of Other Marine Management 11.Regimes
297. We are required to take into account the nature and effect of other marine management regimes in
accordance with section 59(2)(h) of the EEZ Act. Section 7 of the EEZ Act defines what a marine
management regime is. The five government agencies operating marine management regimes
relevant to this application for marine consent are detailed in Table 2 of this decision:
(a) New Zealand Petroleum and Minerals (a branch of the Ministry of Business Innovation and
Employment) – responsible for managing the prospecting, exploration and mining permit
regime.
(b) The Department of Conservation – responsible for marine mammals and protected species
(including the assessment of Marine Mammal Impact Assessments).
(c) Maritime New Zealand – responsible for maritime rules for discharges and oil spills. Plans to
meet these rules include DMPs, which include a Spill Contingency Plan, Well Control
Contingency Plan and Environmental Monitoring Programme.
(d) The Ministry for Primary Industries – responsible for managing fisheries within the EEZ and
territorial waters and biosecurity at New Zealand’s boundaries.
(e) WorkSafe New Zealand– responsible for administering legislation to provide a safe
workplace. This includes responsibility for petroleum operators to submit a Safety Case with
respect to the design, construction, operation and maintenance of oil wells.
298. We requested information from these agencies in order to understand the nature and effect of the
marine management regimes they administer. Whilst some of these marine management regimes
may not specifically consider environmental risks or the controls necessary to avoid, remedy or
mitigate the environmental effects of activities, they all impose standards and requirements that are
relevant to the environmental matters that we must consider under section 59 of the EEZ Act.
299. OMV must comply with its legal requirement under these marine management regimes. However,
these marine management regimes do not all have protection of the environment as a key focus or a
duty to avoid, remedy or mitigate adverse environmental effects. There are gaps between the
requirements of the EEZ Act and the various marine management regimes, particularly with respect
to the management of well integrity.
300. We have given particular consideration to the matter of duplication and consistency between the
conditions of the marine consent and other marine management regimes and their requirements. We
have spent significant time considering this and the legal submissions and advice we received. We
have not imposed conditions that conflict with measures required by other marine management
regimes or the Health and Safety in Employment Act 1992. In order to deal with adverse effects of
the activities for which consent is sought, we have included conditions requiring compliance with
certain parts of those other regimes.
61
Best Practice 12.
301. We are required to take into account “best practice” when considering this application for marine
consent in accordance with section 59(2)(i) of the EEZ Act.
302. The Impact Assessment and evidence on behalf of OMV pointed to a number of specific areas that
demonstrate the application of best practice in this drilling programme.
303. We conclude that the information provided in the Impact Assessment, the Genesis Oil and Gas
Consultancy Limited Report and the evidence from other government organisations indicates that the
development drilling programme will be undertaken in accordance with industry-recognised best
practice.
62
Conditions 13.
304. In accordance with section 59(2)(j) of the EEZ Act, we are required to take into account the extent to
which imposing conditions under section 63 of the EEZ Act might avoid, remedy or mitigate any
adverse effects of the activity.
305. Section 63 of the EEZ Act states:
“(1) The Environmental Protection Authority may grant a marine consent on any condition that it
considers appropriate to deal with adverse effects of the activity authorised by the consent
on the environment or existing interests.
(2) The conditions that the EPA may impose include, but are not limited to, conditions—
(a) requiring the consent holder to—
(i) provide a bond for the performance of any 1 or more conditions of the consent:
(ii) obtain and maintain public liability insurance of a specified value:
(iii) monitor, and report on, the exercise of the consent and the effects of the activity
it authorises:
(iv) appoint an observer to monitor the activity authorised by the consent and its
effects on the environment:
(v) make records related to the activity authorised by the consent available for
audit:
(b) that together amount or contribute to an adaptive management approach.
(3) However, the EPA must not impose a condition on a consent if the condition would be
inconsistent with this Act or any regulations.
(4) To avoid doubt, the EPA may not impose a condition to deal with an effect if the condition
would conflict with a measure required in relation to the activity by another marine
management regime or the Health and Safety in Employment Act 1992.”
306. OMV initially proffered 37 consent conditions in section 8 of the Impact Assessment. Comments
were made on these proffered conditions in the EPA Staff Report. Expert witnesses made a number
of comments regarding these conditions in their pre-circulated statements of evidence. At our
request, EPA staff prepared an Addendum to the EPA Staff Report (20 October 2014) commenting
on conditions and recommending a number of revisions and new conditions to address
environmental effects.
307. OMV subsequently decided that it no longer supported all of the conditions that it had proffered in the
Impact Assessment. In opening submissions, OMV tabled Annexure A – OMV response to EPA
proposed amendments/rationalisation of draft consent conditions – 29 October 2014. This document
63
commented on the EPA revised conditions and sought the deletion of a number of these, including
conditions OMV had initially proffered.
308. In summary, OMV stated that a number of conditions should be deleted because they do not relate
directly to an activity for which consent is sought under section 20 of the EEZ Act and that conditions
must deal with adverse effects.
309. OMV stated: “There is no specific prohibition on imposing a condition that would duplicate a measure
required under another marine management regime. Such a condition would be lawful, in contrast to
a condition that would conflict with another regime.”
310. However, OMV submitted that “if a condition would duplicate another marine management regime,
the condition would not be necessary to deal with adverse effects of the activity, because those
effects are already being dealt with by the existing marine management regime. The condition would
therefore be superfluous, which in our submission is relevant to the question of whether the condition
is appropriate.”
311. OMV also submitted that sections 63(3) and (4) of the EEZ Act impose important limitations on the
EPA’s power to impose conditions.
312. We were provided with legal advice from Mr Tim Smith32 and Ms Jacinta Bowe33, which outlined the
various enforcement mechanisms and penalties under other marine management regimes and the
EEZ Act.
313. The evidence of Mr Vernon illustrated the point that the various regulators have different focuses
and, in the case of WorkSafe New Zealand, “don’t have any jurisdiction over environmental matters”.
He explained that, if the Consent Holder had to ensure all activities undertaken under the marine
consent must comply with the current Safety Case accepted by WorkSafe New Zealand, it would be
a mechanism an environmental regulator could use to bring enforcement action within their
jurisdiction.
314. Mr Vernon stated that the well examination scheme and management systems to ensure well
integrity were of particular interest to environmental regulators and WorkSafe New Zealand. He
noted that, while there is an overlap, “it is possible to have a major environmental issue without there
being any safety implications”.
315. We have endeavoured to avoid unnecessary duplication where effects are appropriately managed
under other marine management regimes, such as with oil spill response requirements. We have
determined that some conditions that may appear to duplicate other requirements are appropriate
where they directly relate to the EPA exercise of statutory functions under the EEZ Act and the
avoidance and mitigation of adverse effects of the activity authorised by the consent on the
environment or existing interests.
32 Counsel for the Decision-making Committee 33 Counsel for the Decision-making Committee
64
316. We are mindful of the lack of empirical data underpinning the assessment of environmental effects in
relation to the dispersal and deposition modelling and the underwater noise assessment. While we
consider that we have the best available information on these effects, we consider it is reasonable
and appropriate to impose conditions requiring actual measurements to ensure the validity of the
assessments undertaken.
317. We are conscious that the assumed range of particle sizes and concentration levels of metal and
metalloids in the drill cuttings and muds are key assumptions in the effects assessment, and for this
reason, we consider these should be measured.
318. Similarly, the effects assessments were based on a discharge volume of 3,000 m3 of drill cuttings
and muds. We consider it appropriate to limit the scale of the activity by imposing a limit of 3,500 m3
and are satisfied on the basis of questioning the relevant expert witnesses that this is within the
scope of their assessment.
319. The Department of Conservation recommended the inclusion of a number of conditions on any
marine consent in order to avoid, remedy or mitigate adverse effects on marine mammals. They
made this recommendation in their letter dated 4 August 2014. Most of these conditions have been
incorporated into the conditions imposed regarding training personnel in marine mammal
identification, cetacean sightings and recordings, recording and reporting marine mammal contact
(such as ship strike, entanglement, death or injury), reporting and recoding seabird collisions,
helicopter pilot training, vessel avoidance of whale aggregations and reporting compliance
monitoring with conditions.
320. We have imposed a condition requiring the recording of refuelling events associated with the
exercise of the marine consent. The evidence supports the view that refuelling activities pose the
highest risk in terms of the probability of an oil spill.
321. Having given considerable thought to appropriate consent conditions, we are satisfied that we have
imposed conditions that have a valid purpose and deal with potential adverse effects of those
aspects of the drilling programme that are authorised by the consent on the environment or existing
interests. The conditions are fair and reasonable and do not conflict with any other marine
management regime or health and safety legislation.
65
Relevant Regulations and Other Applicable Law 14.
14.1 Relevant Regulations
322. Section 59(2)(k) of the EEZ Act requires us to take into account relevant regulations. Regulations are
defined in section 4 of the Act to mean regulations made under the EEZ Act. We have taken into
account the Exclusive Economic Zone and Continental Shelf (Environmental Effects – Permitted
Activities) Regulations 2013. These regulations state which activities are permitted activities for the
purpose of the EEZ Act and the conditions for undertaking those activities without a marine consent.
14.2 Other Applicable Law
323. Section 59(2)(l) of the EEZ Act requires us to take into account any other applicable laws. We have
taken into account the following relevant statutes and the regulations, rules and policies made under
them:
(a) Biosecurity Act 1993
(b) Fisheries Act 1996
(c) Health and Safety in Employment Act 1992
(d) Marine and Coastal Area (Takutai Moana) Act 2011
(e) Marine Mammals Protection Act 1978
(f) Maritime Transport Act 1994
(g) Resource Management Act 1991
(h) Wildlife Act 1953
(i) Crown Minerals Act 1991.
324. These laws have been discussed in earlier sections of this decision.
66
Other Relevant Matters 15.
325. Section 59(2)(m) of the EEZ Act enables us to take into account any other matter that we consider
relevant and reasonably necessary to determine the application for marine consent.
326. A number of matters were raised by submitters during the course of the hearing that could be
determined as other relevant matters in accordance with section 59(2)(m) of the EEZ Act.
15.1 Value of Investment
327. Mr Welsh considered that we should take into consideration the resources that OMV has invested in
developing the Maari field.
328. We accept that the value of investment undertaken by OMV is a relevant matter to be considered in
determining the application for marine consent. We accept the evidence of Mr Zeilinger that OMV
(along with its joint venture partners) has invested over NZ$1.3 billion in the development of the
Maari field.
15.2 Hydraulic Fracturing/Water Injection
329. Some submitters asserted that the activities being undertaken by OMV involve hydraulic fracturing
(‘fracking’).
330. Climate Justice Taranaki raised a series of questions for Mr Barker in advance of the hearing
regarding the topic of water injection, hydraulic fracturing and fracking. These sought clarification of
the chemicals involved in the water injection process, whether hydraulic fracking has been
conducted at the Maari field previously and whether fracking will be involved in the drilling
programme in order to create further fractures.
331. We received supplementary evidence from Dr Zelt on the chemicals used in the water injection
process, the water injection scheme undertaken between 2009 and early 2014 and the water
injection scheme into the future.
332. The techniques of concern to Climate Justice Taranaki and other submitters are related to production
activities and are not activities for which marine consent is sought as part of this application. Whether
OMV is undertaking hydraulic fracturing or not, we are satisfied that the potential effects that we are
obliged to consider in accordance with section 59 of the EEZ are appropriate and will be minimal.
15.3 Precautionary Approach
333. Mr De Vantier and Ms Cheung recommended that we adopt a precautionary approach in our
decision-making given New Zealand’s international obligations with respect to the Convention on
Biological Diversity 1992.
67
334. As already noted in this decision, we find that there is nothing in the Convention on Biological
Diversity 1992 that would preclude us from granting consent. We do not accept that international
instruments require considerations additional to the criteria and information principles set out in the
EEZ Act. The emphasis on the importance of protecting sensitive aspects of the environment, taking
into account uncertainty or inadequacy in information, and the requirement to favour caution and
environmental protection where information is inadequate or uncertain are central to the framework
by which New Zealand meets its obligations under international conventions.
15.4 New Technology
335. Ms Linda Hill34, Ms Jean Kahui and Mr Alistair McKee35 made a number of claims that the drilling
programme involves new technology and that this technology has environmental and safety risks.
They were particularly concerned about the horizontal drilling and the use of SBMs but were not able
to provide us with any specific information regarding whether the technology is new or the potential
environmental risks of these activities.
336. We do not accept that horizontal drilling and the use of SBMs constitute new technology with
inherent environmental and safety risks. Dr Zelt explained that horizontal drilling has occurred for
some time and that existing wells at the Maari field were horizontally side-tracked as early as 1998.
337. The horizontal drilling will be the longest to have occurred in New Zealand. This does not alter our
conclusions with respect to the potential environmental effects of the drilling programme.
34 Submission number 110362 35 Submission number 110378.
68
Adaptive Management 16.
338. Section 61(3) of the EEZ Act states that, if favouring caution and environmental protection means
that an activity is likely to be refused, the EPA must first consider whether taking an adaptive
management approach would allow the activity to be undertaken.
339. The EPA Staff Report noted that we can impose conditions on a marine consent in accordance with
section 63 of the EEZ Act in order to apply an adaptive management approach. The EPA Staff
Report also noted that they have considered whether an adaptive management approach could be
applied to any of the activities proposed by OMV should we determine that favouring caution and
environmental protection means the application is likely to be refused.
340. The EPA Staff Report stated that the application for marine consent is for activities that have already
commenced and are temporary and that an adaptive management regime is not appropriate.
341. Given our finding on potential effects for the drilling programme on the environments and existing
interests and our decision is to grant marine consent, we have not given any further consideration of
the need for an adaptive management approach in accordance with section 61(3) of the EEZ Act.
69
APPENDIX 1: MARINE CONSENT CONDITIONS
This marine consent authorises the activities described in Table A (below).
Table A1.1: Activities Authorised by this Marine Consent
Consent Category Authorised Activities
Section 20(1) and (2) – Exclusive Economic Zone and Continental Shelf
(a) The construction, placement, alteration,
extension, removal, or demolition of a
structure on or under the seabed.
Removal of the jack-up drilling rig legs from the
seabed.
Alteration of the equipment on the WHP.
(b) The construction, placement, alteration,
extension, removal, or demolition of a
submarine pipeline on or under the seabed.
Installation of submarine pipelines (production tubing,
casing and associated fittings) under the seabed.
(d) The removal of non-living natural material
from the seabed or subsoil.
Drilling of the wells involving the removal of material
from the subsoil.
(e) The disturbance of the seabed or subsoil
in a manner that is likely to have an
adverse effect on the seabed or subsoil.
Removal of the jack-up drilling rig legs from the
seabed.
(f) The deposit of any thing or organism in,
on, or under the seabed.
Deposition of drill cuttings and other materials on and
under the seabed.
Deposition of settling sediment from the plume
generated from the removal of the jack-up drilling
legs.
(g) The destruction, damage, or disturbance of
the seabed or subsoil in a manner that is
likely to have an adverse effect on marine
species or their habitat
Removal of the jack-up drilling rig legs from the
seabed.
Section 20(3) and (4) – Exclusive Economic Zone
(a) The construction, mooring or anchoring long-
term, placement, alteration, extension,
removal, or demolition of a structure or part
of a structure
Removal of the jack-up drilling rig legs from the
seabed.
(b) The causing of vibrations (other than
vibrations caused by the normal operation
of a ship) in a manner that is likely to have
an adverse effect on marine life
Generation of vibrations from drilling the wells.
70
This marine consent is granted subject to the following conditions:
1) This marine consent expires two years following the grant of this marine consent.
2) This marine consent must be exercised in general accordance with the application for marine consent,
dated 3 June 2014, supporting documents and evidence presented by the Consent Holder as set out in
Schedule 1, except where these are modified by the conditions below. Where there is a conflict between
the application material and evidence, the evidence must prevail.
3) A copy of this marine consent and any variations must be present at the Consent Holder’s head office in
New Zealand until its expiry date and on the ENSCO 107 while the development drilling activities are
being undertaken.
4) The Consent Holder must ensure all personnel, including but not limited to those of joint venture partners
and contractors involved in the development drilling authorised by this marine consent, are informed of
their obligations and required actions and responsibilities under this marine consent.
5) Any harmful substances deposited on the seabed under this consent must be discharged into the sea in
accordance with the requirements of the Discharge Management Plan. The Consent Holder must
provide the Environmental Protection Authority with the following:
a. A copy of the Maritime New Zealand approved Discharge Management Plan associated with this
marine consent within five working days of the grant of consent.
b. A copy of any Maritime New Zealand approved variations to the Discharge Management Plan
associated with this marine consent within five working days of Maritime New Zealand approving a
variation.
6) The Consent Holder must comply with regulations 64, 65, 66, 67, 68, 69, 70, 71, 72 and 76 of the Health
and Safety in Employment (Petroleum Exploration and Extraction) Regulations 2013 in respect of all
activities to which this marine consent relates.
7) The Consent Holder must make available to the Environmental Protection Authority, on request, the
records and reports required to be made and retained under regulations 72 and 76 of the Health and
Safety in Employment (Petroleum Exploration and Extraction) Regulations 2013.
8) The Consent Holder must ensure that at least one senior employee or suitably qualified or experienced
contractor is formally allocated responsibility for collating information on compliance management in
relation to this marine consent and for reporting information in accordance with the requirements of this
marine consent. The name and contact details of this person shall be provided to the Environmental
Protection Authority and updated as necessary.
71
9) The Consent Holder must ensure that a primary well control system is installed and maintained
throughout the drilling programme in accordance with the manufacturer’s specifications.
10) The Consent Holder must, within 20 working days of the grant of this marine consent, provide the
Environmental Protection Authority with a copy of the acknowledgement by Maritime New Zealand of its
acceptance of the Development Drilling Well Control Contingency Plan and Site Marine Oil Spill
Contingency Plan.
11) During the period the ENSCO 107 is positioned on site, the Consent Holder must conduct a daily
inspection of the ENSCO 107 and record the following information as an electronic inspection log to be
stored on the ENSCO 107 and made available on inspection or on request by the Environmental
Protection Authority:
a. Hydrocarbon or hazardous substance spill occurrences that have the potential to, or result in, an
uncontrolled discharge into water;
b. Rig activity (drilling and testing); and
c. Any non-compliance with the Maritime New Zealand approved Discharge Management Plan or any
subsequent approved variations to the Discharge Management Plan associated with this marine
consent and how those matters were resolved.
12) The Consent Holder must on request provide the Environmental Protection Authority with a record of
refuelling events associated with this marine consent carried out in accordance with section 4.4.4 of the
Maritime New Zealand approved Discharge Management Plan or any approved variations to the
Discharge Management Plan.
13) The Consent Holder must notify the Environmental Protection Authority within 24 hours of a spillage of
hazardous substances, including hydrocarbons, into water.
14) The Consent Holder must notify the Environmental Protection Authority in writing within 24 hours of any
loss of well control, emergency shut-in or failure of other equipment that has potential for an unplanned
release or discharge of hazardous substances, including hydrocarbons, into the environment.
15) In the event of an oil spill, the Consent Holder must liaise with the relevant regional councils and iwi
entities, the Department of Conservation, Maritime New Zealand and the Environmental Protection
Authority to determine whether monitoring is likely to detect any environmental effects and, if so, agree
on appropriate monitoring and timeframe. The results of the monitoring must be provided to the
Environmental Protection Authority on request and in a written summary report within three months of
the completion of the monitoring.
72
16) The Consent Holder must maintain an electronic log of the following:
a. The total volume of cement used per well drilled, estimated by dry weight;
b. The total volume of milling swarf removed to shore, estimated by weight at the land-based disposal
site;
c. The total volume of material removed through drilling from each well, estimated from length and
diameter of completed wells;
d. The total volume of material shipped to shore, including cuttings and muds (but excluding milling
swarf), estimated from the number of skips shipped;
e. The total volume of water-based muds used per well; and
f. The total volume of synthetic-based muds used per well.
The unit of measurement reported must be consistent for all materials.
The electronic log must be kept on the ENSCO 107 and be provided on request to the Environmental
Protection Authority.
17) The Consent Holder must collect as much of the milling swarf as is practicable for disposal at an
authorised land-based disposal facility.
18) The Consent Holder must take one representative sample per well of each of the following materials:
a. Drill cuttings produced while using water-based muds;
b. Drill cuttings produced while using synthetic-based mud; and
c. Water-based muds prior to their discharge into the water at the end of drilling.
Each sample must be assessed, as soon as practicable, for levels of arsenic, barium, cadmium,
chromium, copper, mercury, iron, lead, manganese, nickel and zinc.
The Consent Holder must maintain an electronic log of results to be kept on the ENSCO 107 and be
provided on inspection or on request to the Environmental Protection Authority.
19) The Consent Holder must ensure that all drill cuttings and drilling muds that are discharged into the
waters of New Zealand’s economic exclusive zone as a result of activities authorised by this marine
consent are released into the sea at least 10 metres below mean sea level.
73
20) Dry/unmixed cement must not be deposited on the seafloor under this marine consent.
The Consent Holder must maintain an ongoing electronic record of the following in relation to unmixed
cement:
a. Volume of dry/unmixed cement brought to the ENSCO 107;
b. Volume of dry/unmixed cement kept on the ENSCO 107;
c. Volume of unmixed cement used in drilling; and
d. Volume of dry/unmixed cement returned to shore at the end of the drilling programme.
This electronic record is to be kept on the ENSCO 107 and be provided on inspection or on request to
the Environment Protection Authority.
21) The combined total volume of subsea material removed as a result of activities authorised by this marine
consent, must not exceed 3,500 cubic metres, as estimated from length and diameter of completed
wells.
An electronic log recording the estimated amount of subsea material removed must be kept on the
ENSCO 107 and be provided on inspection or on request to the Environmental Protection Authority.
22) Alterations to the wellhead platform described in the application and undertaken in accordance with this
marine consent must take place on the topsides of the wellhead platform.
23) Drilling must commence from within existing conductors. The Consent Holder must record the depth in
metres below the seabed at which drilling commenced for each well in an electronic log. This electronic
record is to be kept on the ENSCO 107 and be provided on inspection or on request to the Environment
Protection Authority.
24) The Consent Holder must ensure compliance with the Craft Risk Management Standard – Biofouling on
Vessels Arriving to New Zealand (15 May 2014) of all vessels originating outside New Zealand’s
territorial waters (as defined in that standard) and brought into New Zealand’s territorial waters in
connection with the activities authorised under his marine consent.
74
25) The Consent Holder must ensure all offshore personnel involved in the development drilling authorised
by this marine consent, including but not limited to contractors, undertake environmental awareness
training on the requirements of the Marine Mammals Protection Act 1978 and Part 3 of the Marine
Mammals Protection Regulations 1992. The training must include marine mammal identification and
reporting protocols for coming into contact with marine mammals (such as strikes and entanglements),
incident reporting and emergency exceptions. This training must include specific Maui’s and Hector’s
dolphin reporting requirements (as per Conditions 27 and 30) and seabird collision reporting
requirements (as per Condition 28). The Consent Holder must also make available to all offshore
personnel marine mammal species identification guides relevant to New Zealand to help ensure
accurate identification of species.
26) If a strike, entanglement or injury results in a death and involves a Maui’s or Hector’s dolphin, the
Consent Holder must:
a. Notify the Department of Conservation immediately; and
b. Subject to the Consent Holder’s obligations under the Marine Mammals Protection Act 1978 and the
Health and Safety in Employment Act 1992, take all practicable steps to recover the carcass and
return the carcass to shore as soon as possible for collection by the Department of Conservation.
27) The Consent Holder must maintain an electronic log of all seabird collisions with the ENSCO 107 and
support vessels that occur throughout the exercise of this marine consent. The electronic log must
include:
a. The date and time of collision;
b. Weather conditions (including wind direction, approximate speed, the presence of precipitation, fog
or any other weather-related impact on visibility);
c. Species (where known);
d. The condition of the bird (dead, released alive and unharmed, or injured); and
e. Photographs (where practicable).
A digital copy of the log must be provided to the Department of Conservation and the Environmental
Protection Authority within one month of the day on which the legs of the ENSCO 107 are removed from
the seabed.
28) The Consent Holder must ensure helicopter pilots have been provided with environmental-awareness
training as well as identifying established terrestrial seal haul-out and breeding areas to identify the flight
paths that helicopters should use, subject to Civil Aviation Authority flight path restrictions, prevailing
weather and safety considerations, to minimise disturbance to those areas.
75
29) The Consent Holder must compile a written report six months after the grant of this marine consent and
every six months thereafter until the term of this marine consent has expired, detailing all cetacean
sightings from the ENSCO 107 over the previous six-month period. This must be provided to the
Environmental Protection Authority and the Department of Conservation electronically within four weeks
of each six-month reporting period. This report must include as a minimum:
a. The date and location of all cetacean sightings from the consented operation;
b. The species of cetacean (where known) and number of individuals (including presence of juveniles)
associated with each sighting;
c. The behaviour of cetaceans sighted, including their direction of travel;
d. Any cetacean injuries or mortalities observed;
e. The approximate size of each cetacean; and
f. Any physical interaction (including but not limited to vessel strike or entanglement) between any
cetacean and any equipment, vessels or other inanimate objects related to the Consent Holder
exercising this marine consent.
30) The Consent Holder must report any sightings of a Maui’s or Hector’s dolphin from the ENSCO 107 to
the Department of Conservation within 24 hours of the sighting and give details including location, time,
weather conditions, number and approximate size of individual dolphins.
31) The Consent Holder must ensure that all vessels associated with the activities authorised by this marine
consent avoid whale aggregations.
32) The Consent Holder must prepare a compliance monitoring report that must be provided to the EEZ
Enforcement and Compliance Manager of the Environmental Protection Authority every six months for
the term of this marine consent with the first report due on the seven-month anniversary of the grant of
this marine consent and the final report to be provided within three months of the day on which the legs
of the ENSCO 107 are removed from the seabed. This report must be provided electronically and will
need to be available on the ENSCO 107 for inspection or on request by the Environmental Protection
Authority. The report must, for the previous six months, report on monitoring relating to:
a. Condition 11;
b. Condition 14;
c. Condition 16;
d. Condition 18;
e. Condition 20;
f. Condition 21;
g. Condition 23;
h. Condition 27; and
i. Condition 29.
76
33) The Consent Holder must provide the Environmental Protection Authority on request the results (where
available) of the Environmental Monitoring Programme required by the Maritime New Zealand-approved
Discharge Management Plan and any approved variations to the Discharge Management Plan
associated with this marine consent.
Note: Working days are as defined in section 4 of the EEZ Act.
77
APPENDIX 2: ABBREVIATIONS AND ACRONYMS USED IN THIS DECISION
CMA Coastal Marine Area
DMC Decision-making Committee
DMP Discharge Management Plan
EEZ exclusive economic zone
EEZ Act Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012
EPA Environmental Protection Authority
EPA Staff Report EPA Staff Report prepared in accordance with section 44(1)(b) of the EEZ Act
FPSO floating production, storage and offloading vessel
km kilometre
m metre
m2
square metre
m3 cubic metre
mm millimetre
MNZ Maritime New Zealand
MPI Ministry for Primary Industries
ms-1
metres per second
NKTT Ngā Kaihautū Tikanga Taiao
nm nautical mile
OMV OMV New Zealand Limited
PAH polycyclic aromatic hydrocarbon
PCB polychlorinated biphenyl
ppm parts per million
SBM synthetic-based mud
TPH total petroleum hydrocarbon
WBM water-based mud
WHP wellhead platform
78
APPENDIX 3: PROCEDURAL HISTORY
Timeline for Application
3 June 2014 Application for marine consent lodged with the EPA by OMV
17 June 2014 EPA completeness of application check completed
30 June 2014 Letter sent to OMV requesting further information (EPA staff request #1)
10 July 2014 EPA appointed DMC including delegating decision-making powers to it
17 July 2014 EPA requested further information from the Department of Conservation, the Ministry
for Primary Industries, Maritime New Zealand and WorkSafe New Zealand
18 July 2014 EPA served copies of the OMV application on persons required by section 44A of
the EEZ Act
18 July 2014 OMV response received to part of EPA staff request #1
25 July 2014 OMV response received to part of EPA staff request #1
1 August 2014 OMV response received to part of EPA staff request #1
1 August 2014 Ministry for Primary Industries response received to EPA request for further
information
4 August 2014 Department of Conservation response received to EPA request for further
information
12 August 2014 Maritime New Zealand response received to EPA request for further information
22 August 2014 DMC requested further information from OMV
10 September 2014 OMV response received to part of DMC request
17 September 2014 OMV response received to part of DMC request
10 October 2014 WorkSafe New Zealand response received to EPA request for further information
15 October 2014 DMC requested further information from New Zealand Petroleum and Minerals and
MNZ
20 October 2014 Letter sent to OMV requesting further information (EPA staff request #2)
24 October 2014 New Zealand Petroleum and Minerals response received to DMC request for further
information
7 November 2014 MNZ response received to DMC request for further information
13 November 2014 WorkSafe New Zealand response received to DMC request for further information
9 December 2014 Closure of hearing
18 December 2014 Decision date
79
APPENDIX 4: SUMMARY OF SUBMISSIONS
The following tables provide an overview of the issues raised by submitters. Issues are provided against the relevant subsections of section 59(2) of the EEZ
Act.
Table A5.1: Reasons for Support (in full or part)
EEZ Act s 59(2) Reasons for
Submissions
Key Words No.
Submitters
Indicative Comments %
General EEZ purpose EEZ purpose 1 Application is consistent with the purpose of the EEZ. 0.6
(a) & (b) Effects on
the environment or
existing interests
Existing
activity
Existing activity, existing
consented operations
3 The application allows the continuation of an existing activity. 1.9
(j) Imposing
conditions
Conditions Oil spill, controlled
activity, insurance,
compensation
2 Given the possible severity of effects on marine and coastal
environment, conditions requiring adequate insurance should
be imposed regarding spill response and insurance.
Exploration should be in a controlled atmosphere.
1.3
Table A5.2: Reasons for Neutrality
EEZ Act s 59(2) Reason for
Submissions
Key Words No.
Submitters
Indicative Comments %
(f) Economic
benefit
Economic
benefit
Economic benefit, taxes,
royalties
1 The Ministry of Business, Innovation and Employment (MBIE)
projects that the Maari Growth Project will deliver $377
million in royalties and $449 million in corporate taxes, which
is significantly in excess of the figures OMV submitted, which
can be explained by the different exchange rates used.
0.6
(j) Imposing
conditions
Conditions Oil spills, conditions 1 Requested more information regarding how OMV will
respond to oil spills and implement best practice.
0.6
(l) Other applicable
law
Consistent
with other
legislation
Crown Minerals Act 1991 1 Maari Growth Project is entirely consistent with the Crown
Minerals Act 1991 and the permit conditions of each permit
participant to the Maari field.
0.6
80
Table A5.3: Reasons for Opposition (in full)
EEZ Act s 59(2) Reason for
Submissions
Key Words No.
Submitters
Indicative Comments %
(a) Effects on the
environment or
existing interests
of allowing the
activity
Cumulative
effects
Cumulative effects,
cumulative impacts
103 The application does not take into account synergistic and
cumulative effects on endangered marine species and
biodiversity, including those of other exploration activities in
the vicinity. Concerns about the cumulative effects of seven
wells in the vicinity.
66.5
NZ brand 100% pure image, clean
green image, green
image, NZ brand
7 The application will have implications for New Zealand’s
brand and clean green image.
4.5
Māori cultural
values
Tikanga Māori,
tūrangawaewae, kaitiaki,
kaitiakitanga, Māori
interests, iwi, whakapapa,
spirituality
8 Concerns around the implications of the application for Māori
cultural values. The proposal could have effects on
tūrangawaewae. The application is inconsistent with
kaitiakitanga.
5.2
Tourism Tourism 3 Concerns that the application will affect tourism in the area. 1.9
Impact on
coastal
communities
and industry
Employment, livelihood,
aesthetics, coast, industry
57 Concerns about the potential for the application to have
effects on coastal communities, including industry and
livelihoods. The short-term and long-term impacts on coastal
communities have not been addressed. Could affect
aesthetic beauty of the natural environment.
36.8
Effects of
climate
change
Climate change 10 Concerns around the effects of climate change associated
with burning fossil fuels generally.
6.4
(b) Effects on the
environment or
existing interests
of other activities
undertaken in the
area/vicinity of
application
Recreational
effects
Diving, recreation
(general), fishing,
fisheries, food gathering
59 Application should be declined due to the possible negative
effects on industry, marine farming, fishing and diving.
Possible effects on general recreation and amenity in the
area, particularly for coastal communities. Potential effects on
fisheries.
38.1
Water quality Contaminated waste,
coexist, completion fluid,
WBMs, SBMs, pollution,
toxicity, chemical
23 Concerns around the potential damage and environmental
caused by oil spills and pollution in the marine environment
(particularly the habitats of threatened species) and to
coastal communities. Questions the method for disposing of
14.8
81
EEZ Act s 59(2) Reason for
Submissions
Key Words No.
Submitters
Indicative Comments %
pollution, oil spill,
accidental discharge, MV
Rena, heavy metals,
hazardous event,
hazardous substances,
contamination, discharge
of harmful substances and
contaminants, corrosive
metals
contaminated waste, as type of ingredients disposed of are
toxic to marine life.
Noise and
vibration
Noise, seismic testing,
seismic activity, seismic
surveying, vibrational
drilling
103 The implications of seismic testing and vibration drilling on
marine life, in particular, marine mammals, including Maui’s
dolphins and blue whales. Examples of previous strandings
provided that are potentially linked to seismic testing.
66.5
(c) Effects on
human health
Human health Human health 94 Concerns about the implications of the contaminated waste
and water contamination on human health, particularly
related to the potential for toxic contaminants to enter the
water.
61.0
(d) Protecting
biodiversity and
marine integrity
Biodiversity
and marine
integrity
Fish breeding, ecosystem,
Westland petrel, tissue
sampling, sustainable
management, seabirds,
biodiversity, marine
ecology, penguins,
seabirds, environmental
damage
110 Concerns about the effects of the application on the marine
environment, including oil spills, pollution, noise, ship strikes,
habitat loss and degradation.
71.0
(e) Protecting rare
and vulnerable
ecosystems and
the habitats of
threatened
species
Rare and
vulnerable
ecosystems
Rare and vulnerable
ecosystems
93 EPA is required to take this into account. Not enough
information has been provided regarding rare and vulnerable
ecosystems.
60
Habitats of
threatened
species
Endangered species,
Maui’s dolphin, blue
whale, habitat loss and
degradation, marine
mammals, threatened
species
123 Concerns about the effects of the application on marine
mammals and particularly the Maui’s dolphins and blue
whales in the area. The Impact Assessment makes
erroneous assumptions about the distribution of Maui’s
dolphins and underestimates/misrepresents the risk.
79.4
82
EEZ Act s 59(2) Reason for
Submissions
Key Words No.
Submitters
Indicative Comments %
(f) Economic
benefit
Economic
implications
Economy, economics,
economic implications,
economic impacts, costs,
commercial gain (1),
discounting rates,
opportunity cost
107 OMV’s economic benefit analysis is incomplete and
misleading. The Impact Assessment doesn’t provide
information specific to the economic benefit of OMV’s
application but rather benefits relating to the oil and gas
industry nationwide. There are potentially economic losses
associated with the application (for example, fishing, local
economy), and the application fails to take this into account.
The cost-benefit analysis is not clear.
69.0
(g) Efficient use
and development
of natural
resources
Efficient use
and
development
of natural
resources
Alternative energy,
alternative fuel source
2 There is a general need to move away from fossil fuels
towards renewable energy and fuel sources.
1.3
(h) Other marine
management
regimes
Other marine
management
regimes
Marine Protection Area
(MPA), marine mammal
observer (MMO), passive
acoustic monitoring (PAM)
2 Application ignores the likelihood that MPAs with be created
within zones potentially affected by the activities. Current
monitoring through MMOs and PAM will not be enough.
1.3
(i) Best practice Better
available
technology
Better available
technology
1 Better technology needs to be available to deal with
contaminated waste before further consent for drilling
application occurs.
0.6
(j) Imposing
conditions
Monitoring
and
compliance
conditions
Monitoring, compliance
conditions
3 Discussion around the environmental effects of the
application and the implications of monitoring and
compliance. All the monitoring required under the legislation
will not be enough to mitigate the effects.
1.9
(k) & (l) Relevant
regulations and
any other
applicable law
Other
applicable law
Crown Minerals Act 1 Inconsistent with the Crown Minerals Act 1991. 0.6
(m) Other matters Consultation
conducted/
required
Consultation 3 The application does not provide an analysis of the results of
the consultation process. All iwi and hapū not consulted.
Concerns over consultation and decision-making process,
including data-heavy information documentation.
1.9
83
EEZ Act s 59(2) Reason for
Submissions
Key Words No.
Submitters
Indicative Comments %
Information
requirements
Lack of population
surveys, lack of evidence,
lack of information,
independent peer review,
conflict of interest,
independent experts
98 No systematic marine population surveys have been
undertaken to robustly assess the direct, indirect and
cumulative impacts of the programme on potentially affected
species. Full effects of discharge cannot be assessed without
full disclosure of the contaminants involved.
63.2
Risks
associated
with the
application
Risk 105 There are numerous risks associated with the application and
oil drilling in general such that the application should not be
granted. There are risks of OMV’s activities on critically
endangered species and risks to marine life and coastal
biodiversity as a result of oil spills. The application does not
adequately analyse these risks. The risks to the community
are not clear.
67.7