Gas will keep flowing, Labour says as fossil fuel ban raises concerns about reserves

Households dependent on natural gas need not fear the Government's dramatic ban on new oil and gas ventures, ministers say.

The ban on new offshore oil and gas exploration, described by the Labour-led Government yesterday as historic, immediately raised concerns that it could hit gas-dependent households in the pocket.

New Zealand imports all of its oil, but natural gas comes entirely from domestic fields and around 265,000 homes and 15,000 businesses rely on it.

Leader of the Opposition Simon Bridges, a former Energy and Resources Minister, immediately pledged to reverse the ban if in power.

It would be a "wrecking ball" for the regions and could eventually force New Zealand to import coal because of dwindling gas reserves, he said.

Energy and Resource Minister Megan Woods, however, said there would be absolutely no change to households as a result of the restrictions on exploration, which did not affect existing permits or onshore exploration.

"If your house is heated by gas, it will be tomorrow. It will be next year and the year after."

New Zealand has about 10 years of natural gas in reserve. But Woods said there were many more years' worth of supply within already-permitted fields, most notably the 11 trillion cubic feet of gas believed to be held in the Barque field off the South Island.

That did not completely reassure critics. Business NZ Energy Council executive director John Carnegie said that if these contingent gas fields were never commercially proven, there would be a serious risk to energy security in 10 years.

The new policy came as a shock to some in the fossil fuel industry, and sent ripples through energy-rich Taranaki. New Plymouth Mayor Neil Holdom described it as a "kick in the guts".

Labour MP Andrew Little, who is based in New Plymouth, headed to the region to speak to constituents last night and Prime Minister Jacinda Ardern will head there immediately after returning from Europe next week.

Ardern, who put climate change at the heart of her election campaign, said New Zealand's transition to a zero-carbon economy "must start somewhere" and promised that no jobs would be lost.

The Government needed to act now to prevent an abrupt shock in 30 years, she said.

"I have seen that happen once in the 1980s and I don't want to see that again."

The ban was a major victory for the Green Party - possibly one of the biggest in its 23-year existence. An elated co-leader and Climate Change Minister James Shaw said his party had been working towards this moment for years, if not decades.

"This is truly in the Prime Minister's words the nuclear free moment of our generation," he said.

The policy is also a significant concession for New Zealand First, which has long been a pro-industry party and is heavily dependent on regional votes.

Regional Development Minister and NZ First MP Shane Jones accepted that he could get "hammered" in provincial areas but said it was "a debate worth having".

He offered support to the oil and gas industry.

"This is not a Welsh mining moment", he said. "No one is going to wake up tomorrow and discover they don't have a job in that particular sector."