Bill for clean-up doubles to $349m
The cost to taxpayers of decommissioning the Tui oil field off Taranaki has more than doubled to $349 million, Energy Minister Megan Woods has confirmed.
But Woods told a select committee yesterday that she was determined the situation would not be repeated.
Malaysian-owned firm Tamarind Taranaki bought the Tui field when it was towards the end of its life in 2017 to extract the remaining oil from it, at the same time taking on the responsibility for decommissioning.
But the Government was forced to take over the oil field last year and pick up the tab for the clean-up after production at the field ceased and Tamarind Taranaki collapsed into receivership.
The Government set aside $154m last year to pay for the work.
But Woods said it had to set aside an additional $195m in this year’s Budget because the original cost estimate was based on a 2015 study by Tamarind that had proved to be inaccurate.
‘‘What we have seen is the costs are significantly higher than that,’’ she said.
A spokeswoman for the minister confirmed the bill was now expected to be $349m.
‘‘This is a situation we never want to be in again,’’ Woods told MPs.
‘‘This is a situation which was created because of a gap in the legislation which we closed when we became the Government.’’
The gap meant that the same level of scrutiny was not applied when ownership of an oilfield was transferred as was applied when an operator originally requested a permit to drill.
‘‘We changed the law in 2018 to make sure we never got into that situation again,’’ Woods said.