22 Mar 2017

$800m government bill for dismantling oil rigs

6:03 am on 22 March 2017

At least $800 million of government money will be spent decommissioning privately-owned offshore oil rigs over the next 25 years.

A $216 million drilling platform helped boost imports.

Photo: 123RF

Green Party energy spokesperson Gareth Hughes asked Energy and Resources Minister Judith Collins in Parliament on Monday whether she could confirm that the government was liable for for up to 48 percent of the oil industry's decommissioning costs.

Ms Collins confirmed that was the case.

The government estimated the cost was "between $800 million and $855m over the next 25 or so years", she said.

However, the oil industry had paid more than $3bn to the government in royalties in the last nine years, Ms Collins said.

But Mr Hughes said New Zealand had the fourth lowest tax-plus-royalty rate in the world when it came to oil.

"We can't afford to be cleaning up after the oil industry too," he said.

"The government often claims it is leading international work to phase out oil and gas subsidies, but now it's planning for taxpayers to stump up the better part of a billion dollars to cover the oil industry's backsides."

Get the new RNZ app

for ad-free news and current affairs