Marring ‘Middle Earth’: The Frantic Effort To Exploit New Zealand’s Fossil Fuels


Partial view of Wellington, New Zealand's capital.

View from the train during trip from Auckland to Wellington across New Zealand's North Island.

View from the train during trip from Auckland to Wellington across New Zealand’s North Island.

WELLINGTON, NEW ZEALAND — New Zealand is renowned for its pristine and stunning landscapes. Verdant hills, glaciated volcanoes and mesmerizing beaches compose this island nation like the hexagons of a Settlers of Catan game board. But, as happens in the Settlers of Catan, a rush to exploit resources is transforming unadulterated landscape into a mishmash of development that could quickly spoil the scene.

This is just the latest move in a global game of resource extraction as countries maneuver their way toward underground profits with little regard for what lies in the way. Across the Tasman Sea from New Zealand in Australia, coal-seam gas wells are dividing up bushland, leaving wildlife and farmers in the lurch. On the other side of the Pacific, Ecuador is planning to open up part of the Amazon rainforest to oil drilling. Players of all sizes and strength — from the tiny archipelago nation of the Cook Islands, where offshore mining is poised to take off, to Russia, where huge oil and gas developments along the Arctic Ocean are planned — are in pursuit of economic victory, often with little consideration for social or environmental costs.

New Zealand, mammal-less for most of its history, which led to the evolution of giant, flightless birds like the Moa, is in many areas now a sprawling network of diary and sheep farms. During the eight-hour train ride from Auckland to Wellington one can literally count sheep to fall asleep, of which there are over 30 million in this country of under five million people. Fonterra, responsible for 30 percent of the world’s dairy exports, is New Zealand’s largest company.

In an effort to reduce its dependency on, or at least diversify from, long-established agricultural exports, the New Zealand government is now opening up land and sea for oil and gas drilling and seabed mining.

NZ-pull“Basically the government seems to think that the economic future of New Zealand has to rely on digging up fossil fuels and mining,” said Cindy Baxter, a New Zealand based environmental activist and consultant in an interview near Auckland. “Anything they can open up and prospect, they will.”

Crude oil is currently New Zealand’s fourth-biggest export in terms of value, after dairy, meat and wood. The government is currently offering large swaths of land to be drilled — more than 190,000 square kilometers offshore and more than 1,500 onshore — with bids due by September 26 and successful bidders to be named by the end of the year.

One such company, Anadarko, has submitted plans to start its drilling operations in the coming months. A Texas-based enterprise, Anadarko owns a 25 percent stake in BP’s Macondo oil rig that sank in the Gulf of Mexico in 2010, triggering the massive Deepwater Horizon oil spill. A recent investigative report questions the credibility of Anadarko’s assurances that the massive Gulf of Mexico oil spill had nothing to do with the company and that it will never happen to any of their rigs off the coast of New Zealand. The report concludes that “the credibility of Anadarko’s assurances to New Zealanders rests largely (but not entirely) on the express claim that the company was only a ‘passive investor’ in the Deepwater Horizon rig, and that it didn’t have ‘any input or say in the operation of the well in the planning or execution.’”


Mount Doom from Lord of the Rings with a gas plant nestling under its gaze.

Mount Doom from Lord of the Rings with a gas plant nestling under its gaze.

CREDIT: NZ Prime Minister

“The government has invested a lot of political capital to make it as easy as possible for oil companies to come and drill here,” said Nathan Argent, Policy Advisor for Greenpeace New Zealand, during an interview in a Wellington café. “This includes really low royalties, low taxes and a permissive regulatory framework that in some places has taken away the public’s right to object to drilling.”

Argent was referring a law introduced in the Marine Legislation Bill that would eliminate public consultations for offshore oil and gas drilling. In recent days, New Zealand celebrities such as Jurassic Park star Sam Neill have joined protests against the law.

Another recent legal change bans certain aspects of protest at sea, which Argent said was enacted purely to keep company costs down and limit delays. According to the law, those who damage or ‘interfere’ with offshore oil and mining operations will face a year in jail or a NZ$50,000 fine, while fines of NZ$10,000 will apply to those individuals who come within a 500 meter ‘no go’ zone, and fines of up to NZ$100,000 will be levied on organizations that support such actions.

“The new law prevents protesters from going within 500 meters of drilling rigs or ships, which is unprecedented anywhere in the world,” Argent said. “It actually breaks international law because you’re not allowed to actually propose laws that prevent safe navigation of a vessel, which includes protesters.”

According to Argent, New Zealand’s clean, green reputation was actually born out of the country’s anti-nuclear stance, a position the government established based on activists’ protests at sea. New Zealanders remember well the 1985 bombing of the Greenpeace ship the Rainbow Warrior while it moored in Auckland, ready to confront French nuclear testing in the Moruroa Atoll. In an attempt to neutralize the ship ahead of its planned protest, French secret service agents bombed the ship, sinking it and killing one crew member.

At the time, the New Zealand government even sent out their own navy frigate with Cabinet Ministers aboard to sail into the Pacific and protest nuclear testing.

“Thirty years later it’s hard to overstate the importance of our clean reputation, because 70 percent of our exports are traded off that basis and half the jobs in New Zealand rely on it,” Argent said. “We’re a nation of protesters, so these law changes were a step too far for many people.”

Partial view of Wellington, New Zealand's capital.

Partial view of Wellington, New Zealand’s capital.

Argent said the government is so committed to oil and gas development in large part out of laziness. He thinks the government sees it as a win-win because they don’t have to think about developing a visionary economic policy — the industry just comes in and does their business.

“If all the government has to do it divvy up parts of the ocean, give permits and change a law here and there, then they don’t have to think outside the box,” Argent said. “But if you critique what the government is actually doing as far as creating jobs and bringing about economic development, it’s really very little. At the moment the best they’ve got is oil, gas, and subsidies for the dairy sector, which is also having a rather negative impact on our environment.”


According to New Zealand’s Environment Ministry, more than 60 percent of rivers in the country are unsafe for swimming because of concentrations of nutrients and bacteria from agricultural runoff from companies like Fonterra.


CREDIT: Fonterra

Fonterra has another not-so-green secret: it uses coal and gas to power many of its dairy plants. Coal is one of the dairy industry’s three massive environmental liabilities, alongside polluted waterways and palm kernel feed from deforested land overseas. Currently, Fonterra is planning to open a new coal mine near Auckland to replace an old one, but is being met with local opposition and a push to use more sustainable wood fuels.

Damage to New Zealand’s long-heralded pristine reputation could have a major impact on exports, as was seen this summer when Fonterra experienced a botulism scare. Tests by a New Zealand government research institute indicated the presence of clostridium botulinum, which in turn led to a recall of products from numerous markets, including major dairy importer China.

A number of countries obtain milk for their infant formula manufacturing China relies heavily on Fronterra for powdered milk used in infant formula.

Further testing showed that the product actually contained clostridium sporogenes, which cannot cause botulism. But the scare was enough for the government to organize a high-level campaign to help New Zealand exporters who were adversely affected, including targeted visits to key markets by ministers and senior officials, and up to $1.6 million set aside to help companies shore up business relationships and reassure customers.


The tourism industry in New Zealand is just as reliant as exporters on the country’s reputation for natural beauty and untouched scenery. And with the wildly popular, lavishly filmed Lord of the Rings and Hobbit movies providing the best advertising campaign ever — for free — the expectations have never been higher.

In an effort to capitalize on the new ‘Hobbit’ movies, last year the New Zealand Tourism Board added “100% Middle-earth” to the established “100% Pure New Zealand” slogan. The campaign saw a 23 percent increase in visitors from the U.S.

Verdant hills pass by.

Verdant hills pass by.

However, not all is hunky-dory in Middle Earth, with agricultural over-dependence, natural resource extraction ramping up and climate change blurring the boundaries between idyllic hobbit vistas and Mordor-like scenarios.

Last month, the Prime Minister’s chief science adviser, Sir Peter Gluckman, released a report that said New Zealand will experience extreme rainfall, more hot weather, stronger winds and longer droughts in the coming decades. The report stresses the importance of efforts to cut greenhouse gas emissions and to prepare for changes in the world’s climate.

The report did not receive much attention, however — perhaps due in part to the fact that since 1990 New Zealand’s emissions have risen by 88 percent, second only to Turkey as far as developed countries over the same time period. The statistic is likely nor one the Tourism Board or government are eager to promote.

In addition, New Zealand Prime Minister John Key is part of a conservative New Zealand Government that is generally viewed as uncommitted to seriously tackling climate change. Last month the Government announced an emissions reduction target of five percent below 1990 levels by 2020 — a meager goal, especially in comparison to the EU’s commitment of twenty percent below 1990s levels.

NZ-pull-2At last year’s UN Climate Change Conference in Doha, New Zealand joined Canada in receiving the “Colossal Fossil” award, ranking it worst-equal of the 194 countries participating in the talks.

The press release states in part, “For a country whose emissions are similar in scale to the Canadian tar sands, New Zealand has demonstrated exceptional blindness to scientific and political realities.”

Earlier this month, Argent posted a video of PM Key talking about New Zealand’s future in which Key says, “New Zealand’s natural landscapes are part of what makes this country so special and unique. No matter where I am overseas people want to talk to me about how beautiful our scenery is.”

Key’s homage to the pristine image that has made New Zealand famous was followed immediately by a call to drill those idyllic landscapes.

“I believe that energy and resources could well be a game changer for New Zealand. The next five years are crucial as we encourage further exploration. This is important because if we are to increase our oil and gas exploration by 50 percent, we could potentially earn Royalties of up to $13 billion, which is huge…”

An odd, and seemingly paradoxical, juxtaposition of the importance of New Zealand’s unique beauty and the need to exploit the natural resources that make that beauty possible.

Andrew Breiner contributed the graphics for this piece.