David Clendon

Has Brownlee broken the law?

by David Clendon

It is a question that I have asked a few times this week, but one that I cannot answer. It is a question that deserves an answer.

Here’s the short story:

The Minister for Energy and Resources, Gerry Brownlee, puts together ‘block offers’, which are big blocks on the map for oil exploration rights. Oil companies bid on these for the right to explore for oil.

There is a big block offshore to the north of Cape Reinga, quite sensibly called the Reinga Block offer. When the Minister was putting it together, local Iwi said hang on, we think we own that oil! Crown Minerals said OK, hold on while the Minister has a look at it. Apparently, he never did look at it and the Reinga Block offer went ahead anyway.

Since then, Crown Minerals has told the Waitangi Tribunal that the Crown doesn’t necessarily own the oil outside of 12 miles, and confirmed that not investigating a claim of ownership could be a breach of the Treaty and a violation of international law.

I am no expert in international law, but if Crown officials suggest there might be a problem, the only fair thing to do is ask the question. The problem is the Minister doesn’t seem to want to answer the question.

Here’s the long version:

There is, at the very least, an appearance that the Minister may have acted inappropriately when he ignored Te Aupouri Iwi’s claim to the oil resource in the Reinga Block off the coast of the far north. Crown Minerals sent Te Aupouri a ‘holding position’ letter acknowledging receipt of their claim, pending the Minister’s review. It was never followed up and the Minister opened the Reinga Block offer anyway.

What is at stake is quite significant. Crown Minerals testified to the Waitangi Tribunal in April that the Minister had failed to investigate Te Aupouri’s claim and also confirmed that this might be a violation of international law and the Treaty of Waitangi.

Crown Minerals also stated that the oil in our Exclusive Economic Zone (EEZ) isn’t owned by the Crown.

The Minister’s office has told Maori Television that there is no basis to my claims but to my knowledge he hasn’t made a formal statement. Until the Minister fronts up with his version of the story, I can only rely on the Tribunal’s records.

Here’s an excerpt from the draft transcript of the Management of the Petroleum Resource Inquiry, Wai 796, #2.154, Hearing 26-29 April 2010. In this dialogue, RR is the Crown Minerals guy and GP is the lawyer:

GP       And, the Continental Shelf Act provides that the provisions of the Crown Minerals Act apply with respect to petroleum on the continental shelf, that’s correct?

RR       Yes, they do.

GP       And that’s – - -

RR       They apply the entire Crown Minerals Act.

GP       Bar one provision.

RR       Section 10.

GP       Which is the ownership provision.

RR       Indeed.

GP       Isn’t that a fairly significant exception? The Crown doesn’t own – - -

RR       I mean, it’s – to me it’s not significant, it’s obvious. How else? I mean, the Crown does not own petroleum beyond the – you know, at in the EZ, why wouldn’t that be the position. But, of course, as you well know the Crown has full authority to operate and exercise block offers and so on, it has sovereign rights over resource.

GP       But it can only do so if there are private ownership rights, it must take those into account when issuing permits out in the inclusive economic zone?

RR       That’s right and, you know, Te Aupouri has, through this letter, asserted private ownership rights.

GP       So that raises a very serious issue, doesn’t it?

RR       It raises an issue, yes.

GP       Mm. Because the Crown is obliged to investigate to see if there are customary rights extant when those are raised, that’s an obligation under both international law and under the Treaty of Waitangi, isn’t it?

RR       That’s right, but I would also remind you that the Crown still has authority to proceed with a blocks offer – - -

GP       But is it – - -

RR       – - -because it has asserted sovereign rights over petroleum under section 3 of the Continental Shelf Act.

GP       But that would be subject to any customary rights of ownership that could be proven.

RR       That’s right and I – as yet there is nothing in the New Zealand Court system, there are no claims over those.

GP       But what – - -

RR       But we are considering the issue that you’ve raised.

GP       But that’s why this issue where you didn’t provide a substantive response is so important that the issue of customary rights outside the 12 mile limit is still a live issue.

RR       It is.

So the issue of customary rights outside the 12 mile limit is still a live issue. Why didn’t Brownlee investigate this?

Who does own the offshore oil in the Reinga Block?

Could Te Aupouri’s claim be legitimate? We don’t know because the Minister has failed to look into it.

Was international law violated? We don’t know because the Minister hasn’t responded.

Was the Treaty of Waitangi violated? We don’t know because the Minister hasn’t responded.

What we do know is that the Continental Shelf Act, which says that the Crown Minerals Act applies to offshore areas, also specifically excludes the ‘ownership’ clause of the Crown Minerals Act.

So the Crown can control the management of the offshore oil resource, but it doesn’t necessarily own it.

What obligation does the Minister have to make sure he knows who owns the oil before he issues permits? Crown Minerals seems to think he has an obligation under law to investigate ownership claims, so why hasn’t he?

There are an awful lot of unanswered questions, and what is desperately needed is for the Minister to put all the facts on the table in an open and transparent way. In the absence of facts, all manner of conspiracies can be conjured up to fill the void. That’s not fair to the Minister, yet doing nothing is not fair to Te Aupouri.

There may well be some very good reasons why the Minister failed to investigate Te Aupouri’s claim. There may well be other areas of New Zealand law where the Crown has extinguished any claim Te Aupouri may have.

We know what Crown Minerals has to say about this, but none of this can be resolved until the Minister clarifies his part in the drama.

The silence from the Minister’s office is beginning to get awkward.

Published in Environment & Resource Management | THE GAME by David Clendon on Thu, July 8th, 2010   

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