A paper I presented at the Oil & Gas Symposium, Hastings District Council, 11 October 2013.
A paper I presented at the Oil & Gas Symposium, Hastings District Council, 11 October 2013.
When it comes to mining, Australia has many lessons for us. A 2009 report from the Queensland Government and Centre for Social Responsibility in Mining (CSRM) at University of Queensland showed that housing affordability often declines for people in mining towns who aren’t working in the industry.
Stats from the Real Estate Institute of Queensland (REIQ) show a close correlation between Queensland resources and property booms — median house prices in one suburb soared 65 percent in a year. Great if you’re a property investor, but if you just want an affordable home for your family you might be out of luck.
CSRM studies have documented the “two-speed economy” that follows mining “boom towns”, where people who aren’t working in the industry get a sharp shock when they realise that normal life is suddenly a lot more expensive.
A US Department of Agriculture study published last year found that in three states experiencing petroleum booms, a large increase in production caused only modest increases in local jobs and median household income and employment rose 1.5 percent on pre-boom levels.
There is a range of other peer-reviewed empirical studies on the subject (a few listed below), and I’m happy to look at evidence to the contrary.
So while some incomes will rise during an oil boom, the cost of living for everyone is likely to increase as well — meaning those on a fixed income are in fact worse off. We know that most of the high-paying jobs that go with the territory go to specialists who are brought in.
While this may not on its own be reason enough to say “no” to oil and gas exploration here, it’s important to understand the real opportunities and risks before rolling out the red carpet.
And communities aren’t the only ones thinking hard about the pros and cons. Two months ago Rabobank Group said it would no longer provide finance to anyone involved in extracting unconventional fossil fuels such as oil shales through fracking (see their Oil & Gas policy).
One of the world’s largest lenders, Rabobank is worried about the impact oil and gas production is having on people, productive agricultural land, wildlife and the climate — as well as the release of greenhouse gases and their warming of the planet.
As we are seeing in Taranaki now, there is increasing conflict in the communities affected by the expansion of oil and gas there and a perceived risk to the rural sector from residents near new developments.
A letter to Tiniroto resident John Brodie from the FMG Service Centre says:
“Our Underwriters have confirmed we exclude cover of Fracking and anything related to this activity. Fracking is outside of FMG’s preferred risk profile and is not something we would be willing to cover as we do not insure any risks relating to the mining industry.”
I agree that Gisborne refusing to welcome fossil fuels production here won’t make a serious dent in global greenhouse gas emissions. But global agreements don’t happen out of thin air — they tend to come from grassroots movements that influence local government, national legislation and eventually international diplomacy.
The people of Gisborne taking a stand would help the industry and government to think twice and take notice. But that’s a decision for our community to make, and soon. Last year 2000 locals asked for public notification of any mining resource consent yet Gisborne District Council has chosen not to do so. I think now more than ever we need a forum for the community, our government, iwi and industry to sit down and talk about what the pros and cons really mean for Tairawhiti.
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Weber, J. G. (2012). The effects of a natural gas boom on employment and income in Colorado, Texas, and Wyoming. Energy Economics, 34(5), 1580-1588. doi: http://dx.doi.org/10.1016/j.eneco.2011.11.013
Jacquet, J. 2009. Energy Boomtowns & Natural Gas: Implications for Marcellus Shale Local Governments & Rural Communities, NERCD Rural Development Paper No. 43, January 2009, 63 pp., University Park, Pennsylvania: The Northeast Regional Centre for Rural Development, The Pennsylvania State University. http://www.sciencedirect.com/science/article/pii/S0301421512006702
The possible sale of the Tauwhareparae farms should be part of a review of all council owned property says City Ward district councillor Manu Caddie who is making it part of his election policy for the October local government elections.
While he is not committed to a sale at present he feels the financial returns from the farms do not justify the capital investment they represent. One possible solution would be to have the Office of Treaty Settlements buy them on behalf of the traditional Maori owners.
Mr Caddie is frustrated that a promised review of the council’s business units has not yet happened, mostly because of staffing issues following the departure of the chief financial officer and the delay in finding a replacement until after the rest of the staffing restructure was completed.
“Philosophically I have no problem with the council owning commercial entities provided they have either a strong income earning capacity or provide some other significant social, cultural or environmental benefit,” he said..
“I have complete confidence in the governance, management and operations of the farms, they are in the top ten performing units in the district and I believe those responsible for maximising profits from them are doing a good job of getting the best out of them. I also agree with Hilton Collier that there are opportunities for innovation and value-adding along the supply chain that the directors could focus more resources on.
“However, the financial returns provided by the farms do not justify the capital investment they represent.
“I disagree with the assessment that the return on investment has been over 15 percent for the last ten years. Including the land value in the ROI is dishonest accounting as it is not realised until the asset is actually sold and land values can go down as easily as they go up, though admittedly it is less fickle than some other investment options.
“If we took the actual dividends paid, and perhaps even a portion of the capital reinvestment retained, it seems term deposits and even conservative options like Government bonds would have delivered millions more to offset income that the council otherwise derives from our rates.
“Some sectors of the community have a strong emotional attachment – our rural councillors have tended to favour retention of the farms no matter what, though I have heard a number of farmers are keen to see council ownership reviewed as soon as possible.
“The farm directors and managers over the years have been responsible stewards of the land by committing significant Overlay 3A areas to reforestation, though I would like to know more about the biodiversity offsetting proposed that would allow them to clear a substantial Protected Management Area of indigenous vegetation that will take some time to replicate elsewhere.
“The farms have significance for local Māori and competing Treaty claims on the land meant that they were left out of settlements to date. So there is an option here that would take the risk out of the valuation price not being realised if the property went to market as the Office of Treaty Settlements would be obliged to purchase for no less than the latest registered valuation.
“That option would guarantee that the farms will be retained in local ownership rather than being snapped up by an absentee owner. It would also provide a significant gesture of goodwill from the people of Gisborne to the traditional ‘owners’ of the area and combined with other investment capital from Treaty settlements could pursue some of the innovation potential.
“So, at this stage I’m not saying I am committed to the sale but I am very motivated to have a thorough and independent review of council retaining ownership.
“We should not let politicians get in the way of the facts! I think we need to have a good long look at the likely scenarios should we decide to sell or retain the farms and what protections can be put in place to ensure councillors don’t just squander any proceeds on popular projects that could diminish rather than enhance the overall financial position of council,” said Mr Caddie.
A decision by Gisborne District Council to give the green light to Canadian company TAG Oil for an exploratory well to be drilled west of Gisborne city has been condemned by an RMA Commissioner.
Manu Caddie, who is also a Gisborne District Councillor, says he is supporting an application for a judicial review of the decision based on the public interest test, cumulative effects and the way potential cultural impacts have been handled in the assessment phase.
“Two thousand local residents signed a petition last year requesting any application to drill in the district be publicly notified. All they want is a chance to look into the application and make submissions if they have concerns.”
The Council’s Regional Policy Statement and Combined Regional and District Plan are largely silent on drilling activities and the Council has agreed to review the plan once the Parliamentary Commissioner for the Environment issues her report on fracking later this year.
“The PCE in her interim report on fracking raised a number of real concerns about drilling on the East Coast and the lack of regulation in the petroleum industry as a whole” said Mr Caddie. “Until those concerns are addressed the public should have the right to examine applications and comment on them.”
“An industry representative said just last week that they have nothing to hide, so why are they afraid to give our community the opportunity to be part of the decision-making process.”
Mr Caddie said he understood the company had threatened to leave the district if the application was publicly notified and comments from vested interests meant staff felt pressure to let the application go through non-notified. “I’m sure everyone will deny that is the case, but this is what staff have told me.”
Mr Caddie said it was a sad day for the district and democracy. “The petition of 2,000 citizens must be the largest set of submissions Council has received on a single issue and it is bitterly disappointing that a simple request to have the opportunity to make comments at a public hearing – for or against the proposal – has been seen as less important than the desire of the company to rush into drilling.
Mr Caddie said he believed Council had good grounds to notify the application – while the risk of significant immediate pollution may be limited to a well explosion like the one that happened in the United States last month or limited contamination of land and streams, the cumulative effects of the activity should be taken into account at each stage and the RMA allows for public notification when the risk may be small but the potential effects significant if something goes wrong.
“There is scant information in the application on the process for rehabilitating the site while industry publications suggest at least half of all wells corrode within 30 years allowing fugitive emissions of gas and oil, long after they have ceased production. The area is around known fault lines and aquifers, who knows what impact drilling into those could have.”
The documentation provided with the Council decision suggests one or two individuals within local iwi had signed off on behalf of the tribe with no evidence of hui-a-iwi to provide a mandate or majority of iwi members’ endorsement.
“Iwi and hapū have a right under Te Tiriti o Waitangi, New Zealand law and international agreements to make free, prior and informed decisions on activities that impact on their traditional lands, waterways and air space. From the information supplied I can’t see evidence of that happening in this situation and a number of iwi members have expressed extreme frustration with the process used by the company to consult with iwi.“
Mr Caddie said central government should provide much more support and resources to iwi and hapū that are faced with extractive industries moving into their area.
“Around the world we have seen indigenous peoples welcome industries that make grand promises then leave after ruining the environment local peoples have depended on for generations. It is a familiar story we are seeing played out in our own backyard.”
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Gisborne District Council: Decision Documents
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CONTACT: Manu Caddie – Tel. 0274202957 / Email: firstname.lastname@example.org
A Gisborne District Councillor says the government is picking winners and industries other than oil and gas would grow the regional economy if similar public funds were committed to other parts of the economy.
Manu Caddie would prefer to see government support for developing industries on the East Coast such as renewable biofuels and biochemicals, internet-based small businesses, high tech food production with the associated intellectual property and what he terms ‘lifestyle relocators’.
“We could wait for a new mill to be built and employ a few hundred on minimum wage or we could get on with attracting a hundred innovative, high earning business owners that want to live in places that are vibrant and well connected but out of the rat race of the sprawling metropolitan areas. Compared to the larger centres we have very cheap commercial and residential property prices, a compact city, relaxed lifestyles and relatively unspoiled environment.”
Mr Caddie says the Government has a fundamentally flawed policy of prioritising petroleum development without any plan to reduce greenhouse gas emissions let alone transition the country away from fossil fuels.
“There may well be some short-term economic gain for some members of the community if a significant amount of hydrocarbons can be extracted, but the evidence from overseas is that in mining boomtowns the economic benefits accrue to a certain part of the population while others are worse off and inequalities increase.”
“The region has not had a properly informed debate on the costs and benefits of mining here. There has been no independent analysis and advice on our situation and what the alternatives could be that would deliver more sustainable employment and environmental benefits. If the Government wants to pick winners then at least make it evidence-based instead of ideological. Environmentally sustainable mining is an oxymoron and given the scientific evidence on the impacts of fossil fuel consumption, the issue really is a moral question more than anything else.”
Mr Caddie says he agrees with Steven Joyce and Meng Foon that education needs even more attention.
“This is as much about families and students getting the support they need and taking responsibility as it is about the quality of teaching and approaches to formal learning. More sophiscated understanding of and flexibility around the relationships between schooling, family dynamics, employment and lifestyle choices is critical.”
“Only one in four Gisborne school leavers have NCEA Level 3 or above, nearly ten percent lower than the national average. Between half and three quarters of young people say they do not plan to continue with any form tertiary training after leaving school. A higher proportion of Gisborne young people work in agriculture, fishing, forestry and manufacturing than the national average.”
Gisborne has about 150 young offenders under 17 years. Based on 2001 estimates from PriceWaterhouseCoopers, each year offences committed by young people in Gisborne cost around $2.5 million in Police, court and sentencing costs.
“There is a significant underclass emerging that are extremely disconnected from mainstream society, community leaders, public institutions, employers and community organisations need to get a whole lot smarter about how we think about this part of the population and just focusing on economic development will not be sufficient.”
An overdue government report on the “benefits, impacts and risks” of petroleum development across the East Coast is a sloppy marketing campaign for the industry paid for by taxes and council rates, according to some councillors from Gisborne and the Hawkes Bay.
Gisborne District Councillor Manu Caddie said the $130,000 report released today was originally due in November and the lack of a good news story must be embarrassing for the Government. “The study is riddled with errors, clearly biased and provides less than half of the information promised in the Terms of Reference” said Mr Caddie.
The East Coast Oil and Gas Development Study was funded by the Ministry of Business, Innovation & Employment with support from local authorities on the East Coast from Tararua to Gisborne.
“The study makes some optimistic claims about benefits but glosses over the risks and has almost no worthwhile analysis of the economic impacts let alone social and cultural impacts of this industry should it come to dominate the region” said Mr Caddie.
“One of the few redeeming features of the report is that, based on geological analysis and economic modelling, it suggests commercial petroleum development in the region is highly unlikely” said Mr Caddie. “The study provides a good case for the government to support industries that will produce more sustainable, long-term employment with much lower risk to the environment and existing primary industries.”
One of the bitter ironies of the report is that it relies on production scenarios supplied by Apache Corporation, a company that has since pulled out of exploration in the region. While the report tries to reassure the public and decision makers that well integrity is not a risk, just last week Apache Corporation had a blowout at an exploratory well being drilled only 330m below the surface near New Orleans.
Similarly the study suggests a subsurface safety valve eliminates the risk of hydrocarbon or chemical leaks should a well be compromised, yet according to the US Minerals Management Service such valves have a ‘high failure rate’.
Hawkes Bay Regional Councillor Liz Remmerswaal said the study is inconsistent and selectively quotes from the Parliamentary Commissioner for the Environment’s interim report on fracking.
“The PCE report identified seven key concerns about any petroleum exploration or production on the East Coast and while the MoBIE study says it will not make recommendations it then suggests the questions raised by the PCE do not need to be addressed before exploration starts” said Ms Remmerswaal.
The PCE report also provides evidence on how reinjection processes used in fracking operations overseas have caused significant earthquakes. The MoBIE report is not only silent on these concerns, it recommends the reinjection of waste products from the drilling process.
Both councillors believe the government and councils should commit similar funds to a study on sustainable energy opportunities for the region.
Last month a government-funded trade delegation visited DLR, one of the world’s leading energy market analysts, the same organisation that was recently commissioned by Greenpeace to produce a plan for 100 percent renewable energy use by 2050 for New Zealand.
The Greenpeace report reveals that 250 companies in New Zealand are already researching and commercialising clean technology with Investment NZ suggesting at least 60 of these are world-class enterprises. These companies have potential revenues of $7.5-22billion, significantly higher than the total revenue for even the most optimistic East Coast petroleum development scenarios. The Greenpeace report also provides evidence that clean energy jobs are more secure, safer, often pay better and are created at 3-4 times the number of fossil fuel jobs for the same investment.
“The MoBIE study has some generous claims about how many local people will be employed but why they assume at least half will be local residents is unclear, especially as Apache Corporation representatives speaking at public presentations very clearly refused to promise any direct local employment in the industry” said Mr Caddie.
The report identifies known aquifers in the region and discusses their protection and exclusion from exploration zones though some confusion exists about how the Napier MP and Minister for Local Government Chris Tremain claimed credit for excluding aquifer areas in Hawkes Bay but no where else in country.
“The Minister acknowledges the significant risk to aquifers during drilling and production phases but has only focused on protecting his home patch” said Mr Caddie. The study suggests excluded areas should be identified through changes to regional and district plans.
“It’s a bit fresh that this study is launched the same week as Hawkes Bay Regional Council is asking for a drought to be declared and the study says fracking requires ‘large volumes of water’” said Ms Remmerswaal. “But other than implying a massive new dam will solve the problem, little assessment is made of the existing competition for scarce water resources let alone the impacts of a new industry requiring large volumes to be used and contaminated in the process.”
The councillors are also concerned that the report relies heavily on the few examples of fracking in Taranaki which has very different geology and the regulatory history of the Taranaki Regional Council which the PCE report revealed had been operating outside the law in relation to fracking according to their own lawyers assessment.
Apache Corporation announced the withdrawal from a joint venture on the East Coast in January leaving Canadian company TAG Oil with responsibility for an exploration operation in a complex area both in terms of the geological and cultural landscape. Marauder Resources which holds other permits for exploration in Hawkes Bay received a warning from auditor KPMG last year that the company may not be able to ‘continue as a going concern’.
Liz Remmerswaal 027 333 1066 (will be outside HBRC from 11am-12pm)
Manu Caddie 0274 202 957
Download the MoBIE study and government comments here:
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What is the price of milk? In New Zealand the cost of dairy is that two thirds of our native fish are classified as either at risk or threatened.
After decades of polluting land and water, the dairy industry has finally published a voluntary code in an effort to at least make some effort to clean up their act. My first impression of the new ‘Sustainable Dairying Water Accord‘ is positive as it covers all regions including Gisborne and all dairy companies and farmers supplying them.
Stock exclusion from waterways, riparian planting, nutrient management systems and other good things are all going to be considered industry best practice and will now apply to all dairy farmers.
Gisborne only has a few dairy farms and our Council is understandably taking a low key approach to the new Accord. There is however a big opportunity for us here.
The Council is the local regulator and represents the wider public interest in protecting water quality. Ten years of a previous Accord showed that councils have to be vigilant to ensure that farmers meet their responsibilities under their resource consents to discharge dairy shed effluent.
The small numbers of dairy farms here mean it should be easy for us to get it right. Council recently took a dairy farmer to court for breaching the consent conditions, but we will be able to work closely with farmers to ensure the new Sustainable Dairy Farming Accord is adhered to and avoid the need for future enforcement action.
Let’s hope that our farms are the best in the country and that we can show the rest of New Zealand how to live up to the 100% PURE brand we all aspire to make a reality.
I recently visited two initiatives in Auckland to look at what they are doing with young people and technology. At Point England School in Glen Innes students all have their own NetBook, each family pays $3.50 per week for the child to have their own device for school and home work. At Clubhouse 274 in Otara I visited the Community Technology Centre where students go after school to use high-end equipment they can’t access at home and many were working on commercial projects.
Recently a number of local people and projects have converged to progress some exciting technology opportunities for the district that are already having positive social and economic outcomes, but more support is urgently required.
Tairawhiti Techxpo was a great day last week that provided a solid foundation for a bigger and better event next year. Thanks to the schools that participated, we had hundreds of young people get a taste of employment and career opportunities in the Information and Communication Technology sectors of robotics, hardware, networking, software, app development, entertainment, aerospace, imaging, animation and computer-aided-design industries.
Thanks must also go to the generous sponsors including Te Wānanga o Aotearoa, EIT Tairāwhiti, Eastland Community Trust and the small businesses and individuals that contributed on the day and through the event organising.
One of the Techxpo keynote speakers from Wellington joined the monthly Gizzy Geeks meeting in the evening. Nathalie Whitaker is a net entrepreneur and is keen to move to Gisborne with a number of her colleagues, the lifestyle, surf and clean environment are what attract them. Something that would make Tairawhiti even more appealing to these IT entrepreneurs is for Gisborne to have a bunch of competent geeks who can do the technical programming work that sits behind the software products Nathalie and her friends develop.
What the Techxpo highlighted was that our high schools are now growing such talent locally. Lytton High School had a large contingent of IT experts and Gisborne Girls’ High School and Campion College were also very well represented in the demonstrations provided by students. Other schools have already booked a spot for next year to showcase the skills and products being developed through cutting-edge teaching and learning.
A number of Gisborne school students are now making and selling smartphone apps internationally – this is a $40billion global market with over 10 billion downloads last year alone.
The Rangitawaea Nati Awards next week is an annual fixture that encourages and recognises IT talent in Ngati Porou schools, another fabulous showcase of skills and creativity grown in our region and reaching out to the world.
The Techxpo, the Gizzy Geeks group, the Nati Awards and the new Tairāwhiti Computer Hub Trust have proved a fertile ground for collaboration between technology specialists and a number of exciting new business opportunities are emerging from the relationships built around particular skills, interests and networks.
And where does all this sit in terms of regional economic development planning? It is dismissed in the Regional Economic Development Strategy (2009) as an unlikely prospect and rendered invisible in the subsequent Economic Development Action Plan. Perhaps this absence is not a big issue considering the Action Plan has been largely ignored from the day it was produced.
What is important is that the IT sector is recognised as a cornerstone of every local business and that it is factored into the priorities of entities like the Eastland Community Trust and Gisborne District Council that have a focus on supporting sustainable economic development. While public entities ‘don’t pick winners’, they do provide limitations and opportunities for the expansion of particular industries.
We need to look urgently at what infrastructure beyond Ultrafast Broadband will enable a fledgling IT sector to quickly become a serious economic driver for our local communities. Neighbourhood computer hubs, low-cost residential wi-fi and a commercial programming academy seem sensible ideas to explore.
Gisborne District Councillor and Regional Transport Committee member Manu Caddie says KiwiRail needs to provide the Council with a copy of the full business case that has led to the decision to close the Napier to Gisborne railway line.
“KiwiRail may have skewed the figures to justify closure rather than invest in what is at present a marginal business proposition for them but a lifeline for us. The communities of the East Coast need an independent review by reputable economists of how KiwiRail arrived at its claim that there is no alternative. I think that is the least the Government and KiwiRail owe our region if they are going to strip us of this billion dollar investment.”
“Make no mistake, mothballing is not a temporary arrangement – look what happened in the Bay of Plenty when the line was mothballed, it doesn’t take long to deteriorate to a point where its unsalvageable.”
“Hard on the heels of provincial roading cuts, this Government is clearly abandoning the regions.”
Mr Caddie said his grandfather worked on the railway line in the 1940s and 22 men died while building the section between Wairoa and Gisborne.
“The Government this week passed legislation that will cost $85m to underground a short piece of Wellington motorway so the national war memorial can have more space – our railway line is the memorial for the 22 men who gave their lives for it and we may be the generation that abandons their work.”
Federated Farmers, Gisborne Chamber of Commerce, Hawkes Bay Chamber of Commerce, forest owners and transport operators have all said it is essential to keep the line open. And before the washouts in March, business on the line was booming.
“Fuel prices are only going to increase and rail will become more and more the mode of choice for exports and imports to the region.”
A three year road funding commitment for the Gisborne District has been compared to the washouts plaguing the region at present.
“With more than $400,000 per year cut from the roading programe, this announcement leaves some big potholes in our road maintenance budget” said Regional Transport Committee member Manu Caddie.
Mr Caddie says the Government has cut funding to the region and ratepayers could end up footing more of the bill to maintain local roads.
“There is little in this package to ‘bolster’ Gisborne’s economy – while road maintenance and repair costs are going through the roof and ratepayers are struggling to make ends meet the District doesn’t even to get to keep what it had, we are getting less than last year!”
Mr Caddie pointed to a study presented to the Regional Transport Committee early this month that showed there was little if any economic benefit to be expected from increasing truck sizes on Gisborne roads.
Mr Caddie said while the Regional Transport Committee ended up supporting the funding bid to NZTA it did so largely because Gisborne District Council was told the amount put forward was the maximum the region had any chance of securing under current Government policy.
“It is good to see cycling and walkways made the cut but if you read the fine print, they are only going to be funded if the major project to allow bigger logging trucks to run from Tolaga Bay through the city to Matawhero costs no more than is budgeted for.”
“Regional roads are essential to the economic wellbeing of the District and the country, which is why our Regional Transport Committee is joining other provincial roading authorities and councils to call on the National-led government to drop its commitment to the seven Roads of National Significance. A few roads in the big centres are sucking so much money that the Government has not only taken funds off the regions but is borrowing more overseas to pay for them.”
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Oil lobbyist David Robinson in a recent column said we should let the public make up their own minds: “we can argue back and forth, back and forth using hand-picked examples of why each point of view is right. But that’s not helping anyone.” Of course he included with this statement with a few hand-picked examples.
I guess I do have personal ideology as Mr Robinson claims but I don’t agree it should be ‘put aside’ – it’s an ideology that favours all of the relevant information being made available to the public so we can make free, prior and informed decisions. Any opposition I have has developed since looking beyond the industry PR spin ($185m worth of lobbying in the US alone last year) and trying to take seriously the science related to human use of petroleum and its impact on the planet.
Beyond the climate implications, it seems useful to refer to people with direct experience of the industry, like Caleb Behn who acknowledges the income that can be derived from oil. Weighing these benefits with the negative social, cultural, economic and environmental impacts in his homelands, Caleb is strongly opposed and warns others to look carefully at the situation in British Columbia and Alberta.
The farmer speaking in Gisborne this week is in no way ‘philosophically opposed to the oil and gas industry’ – if Mr Robinson had read her story in The Washington Post he would have seen that Ms. Vargson and her husband used to maintain a herd of dairy cattle but got out of that business because of methane getting into their well water, a fact confirmed by the state regulators. The couple now work at other jobs and worry their son won’t be able to farm there either. Ms. Vargson permitted drilling of a gas well in the pasture behind her home, but the experience has raised serious doubts. Drilling “can be done safely,” she said. ”I believe that the technology is there.” But she added: “I believe that for the most part the industry takes a lot of shortcuts.”
The Royal Academy of Engineering (RAE) and UK Royal Society’s fracking report probably hasn’t been widely promoted because it omits some key facts: the RAE’s ex-President is Lord Browne, Chairman of Cuadrilla, the UK’s leading fracker. Lord Browne was head of the RAE until last year and owns 30% of Cuadrilla.
The RAE is also part funded by the oil and gas industry. In the last three years the RAE has taken £601,000 from oil companies with links to fracking. The same organisation has awarded cash prizes to BP engineers for their work in hydraulic fracturing.
The influence of the oil and gas industry on the RAE has not decreased with Lord Browne’s departure. His successor – Sir John Parker – is closely connected to the fracking industry. Before taking over at the RAE, Parker headed Anglo American with their fracking interests in in South Africa. Parker is a gas man through and through – some of his previous positions include non-executive director at British Gas, Chairman of National Grid Transco (gas distribution) and non-executive of BG Group (which has coal bed methane interests in Scotland).
Mr Robinson says renewables are too expensive, I agree. If it wasn’t for the one trillion dollars of annual public subsidies awarded to the fossil fuel industries and permissive legislation that allows continued access to relatively cheap fossil fuels, renewable technology would be affordable to most of us.
It was great to hear Rod Drury this week talking about how his software company may soon overtake Fonterra as New Zealand’s largest business. IT entrepreneurs are keen to move to Gisborne for the lifestyle and environment it currently offers. Some locals have been in contact with a biochemicals company in California that has huge potential and is interested in establishing a demonstration plant on the East Coast. These seem like far more sensible opportunities for our community to encourage than the dirty business of oil.
I thought about setting up a bed in the corner of the Council chambers last week – four days straight in there with extra reading in the evenings meant I enjoyed the long weekend!
It was awesome to hear from such a cross section of our community. A lot of submitters both urban and rural are concerned about environmental issues like erosion control, flood protection and waste management. We received huge support from both urban and rural folk for improved cycle-ways and walkways in the city, as a result we’ve agreed to bring those projects forward a couple of years.
I find the whole central government planning and funding regime for transport quite appalling – there is no integrated transport planning process and regional priorities get sidelined if they don’t match national priorities. So we’re doing a study of the impact of heavy vehicles in the city and looking for solutions that don’t include scenarios involving rail – go figure. Taxpayers are forking out the ridiculous sum of $14 billion for a few gold-plated Roads of Significance to National while State Highway 35 is falling off the hillside in numerous places with no money to fix the dropouts or build better routes.
This is an exciting week for Tairāwhiti as the Transit of Venus events see world-leading thinkers and doers grace our shores following Captain Cook’s crew.
Cook was a world-leading explorer with a remarkable story of innovation and adaptability that we can still learn much from. His time in this part of the country was a mixed bag to say the least and while locals still grapple with the legacy he left, it is important to acknowledge the constructive engagement and mutual discoveries that emerged during his visit.
It has been encouraging to see local young people wrestling with the name Cook assigned to Poverty Bay and I’ve been impressed with the number of people who have contacted me over the past month about adding another official name.
Dame Anne Salmond has pointed to Cook’s journals that suggest his Tahitian guide Tupaia was told the name for the bay was Oneroa. Local iwi know the land as Turanganui-a-Kiwa, Tūranga-a-Mua, Tūranga Ararau, Tūranga Makaurau and Tūranga Tangata.
I don’t think we need to toss out the name Poverty Bay – it is part of the story of this place and is as much a part of the local community as Kaiti Hill, Rere Rockslide and Meng’s cooking.
It would however be helpful to have another official name that we can use for promoting the area and acknowledging it had a name well before Europeans arrived here. Plenty of places around New Zealand now have two official names.
If anyone is really keen to progress the issue please get in touch as I’d like to get us together to make it happen sooner rather than later.
By the end of last year, Gisborne District Council was owed about $3.5m in overdue rates on Maori land. Council recently agreed to the establishment of a working group to focus on the issues relating to Maori land and rates.
As it turns out, central government also has a group working on the issues, as have many governments before the current one. In fact 80 years ago Sir Apirana Ngata and the Prime Minister, George Forbes, established a joint committee to inquire into the question of unpaid rates on Māori land. The committee found significant areas of land had no rateable value and recommended local authorities to remove such areas from valuation rolls. The committee visited a number of the development schemes on Māori land that Ngata had initiated and the members were impressed with the productivity gains generated off these blocks.
These schemes assisted in a wide range of successful cooperatives operating on the East Coast, enabled Māori to retain ownership and created thousands of jobs.
The Waitangi Tribunal suggests that rates “were initially introduced as a tool of local government to meet its own infrastructure needs and those of settlers, rather than in response to what Māori may have wanted.”
Before 1893 the law did not allow Māori land to be sold to cover rating debts and central government reimbursed local authorities for unpaid rates on Māori land (that it turns out had been grossly overvalued). From 1910, nearly all Māori land became rateable unless held under customary title. In 1924, responsibility for rates recovery was shifted to the Māori Land Court. From then on, if arrears accrued against the land, it could be the subject of a charging order by the court, and placed in receivership or trust for lease or sale.
From 1950 to 1970, new legislation extended the powers of the court to force the development of ‘unproductive’ Māori land that had not been able to pay rates. The Waitangi Tribunal has found that a major effect of legislation introduced during this period seems to have been to boost the use of receivership as a means of rates enforcement.
The whole concept of local government rates has its philosophical origin in European legal theory that all land is ultimately held by the Crown. However, in New Zealand the question has persistently arisen in the development of rating law as to whether land not held by the Crown, but rather held by Maori in customary tenure, should be subject to rates. Council’s Whenua Rahui policy recognises this issue to some degree.
Since the 2007 Local Government Rates Inquiry there has been a shift and valuations for rating purposes make some small concession for the complexities of Māori land tenure and specify this on rates demands.
Dr Api Mahuika has advocated establishment of a Ngāti Porou local government district – some of my colleagues might support this proposal given the high cost of maintaining roads across such a large area and the large proportion of unpaid rates coming from the northern part of the district. Of course such a proposal is unlikely to be within the scope of our working group but it seems a similar emphasis on self-determination is the basis of the Tuhoe position on Te Urewera, as it was for Gandhi before Britain quit India. There are myriad examples of semi-autonomous governance arrangements around the world, so hopefully these local questions eventually get the full consideration they deserve.
The new Council working group will meet next month to determine the Terms of Reference and will no doubt welcome key stakeholders in the discussions and potential solutions. Watch this space!
We have much to thank the oil industry for – that source of energy has enabled humans to achieve all sorts of things that people living 100 years ago would never have dreamed about. I love the fact that I can take my family on holiday to Tauranga and complete the trip in four hours instead of the week or two it would take by horse (if the weather was fine!), I love the medicines, food, clothing and technology that uses cheap oil and gas in their production and distribution processes.
I also know that future generations are going to look back on us in disbelief that we burnt good oil so quickly and carelessly. In light of the overwhelming evidence (well canvased in The Gisborne Herald letters page!) on human caused climate change and peak oil, ‘responsible extraction of fossil fuels’ is quickly becoming an oxymoron.
This is a conscience issue for me, based on the current scientific consensus about the causes of accelerating climate change, I feel I must have some tangible commitment to an urgent transition away from our reliance on fossil fuel toward renewable energy sources.
I currently own a hybrid car that alternates between petrol and electric propulsion. Recently I looked at buying a fully electric car but I could not afford it without adding 40% to our mortgage! I couldn’t help but think that the cost of that electric vehicle, which had been converted from petrol, would be much cheaper if it was more expensive to produce and consume fossil fuels here and overseas. Economies of scale mean that when more people do more of something we usually find cheaper ways to do it.
A recent OECD report estimates New Zealand taxpayers give fossil fuel users around $70 million each year from the public purse. If that is not bad enough, the same report suggests Norway – the country our government suggests we emulate – subsidises fossil fuels to the tune of over $1.8billion per annum. Recent editorials in this newspaper have claimed supporters of investment in renewable energy are proposing subsidies that would be an exercise in ‘government directed disaster’ – I imagine $1.8 billion could be considered a fair amount of government direction.
While the government says it is committed to reductions in carbon emissions, it has made fossil fuel production a key part of the national economic development plan. The 2011 Energy Strategy says the goal is to make this country a “highly attractive” global destination for petroleum exploration and production companies.
The Listener’s latest editorial claims “The current infatuation with the oil and gas sector runs the risk that the necessary investment in and support for new forms of renewable energy will be diminished. Of particular concern is that although the Government is rolling out the red carpet to international exploration companies, the enormous potential gains to be made from greater energy efficiency are going begging.”
Last week over 450 global investors controlling tens of trillions of dollars from four continents gathered at the UN for the biannual Investor Summit on Climate Risk & Energy Solutions.
“Climate change is certain to be a major factor in investments for the foreseeable future—perhaps the biggest investment factor of our lifetimes,” said Kevin Parker, global head of Deutsche Asset Management – this bank alone is worth US$4 trillion dollars.
The NYC summit presented a number of notable achievements including a record $260 billion invested in clean energy in 2011 and over one trillion dollars in the past six years. There was a 36% increase in solar power investments alone (reaching US$136.6 billion) in 2011. The highly successful but recently scrapped US Treasury Grant Program paid out around $9.6b over 30 months and leveraged nearly $23 billion in private sector investment for 22,000 projects in every state across a dozen clean energy industries. Investors signed onto an action plan calling for greater private investment in low-carbon technologies and tougher scrutiny of climate risks across their portfolios.
The world is moving towards renewables driven by the inescapable logic of clean energy. Gisborne may have an opportunity to tie ourselves to an outdated, dirty and what many believe irrational industry in its twilight years, or we could, with the support of central government and private investors, be a region that was bold enough to not only recognise the need for sustainable change but actually lead and prosper from it.
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NOTE: The original post suggested Norway subsidised the fossil fuel industry to the tune of $100b, this was a miscalculation using an online currency conversion tool. The figures are from this OECD report: www.oecd.org/dataoecd/55/5/48786631.pdf