New Zealand abandons international fossil fuel pledge

Newsroom

25-06-2025

New Zealand's departure from the Beyond Oil and Gas Alliance came quietly, but not as a surprise to anyone closely following the Government's fossil fuel policies.
Resources Minister Shane Jones says the coalition's fossil fuel plans meant the exit was inevitable. But he also says more formal agreements, like free trade deals with the EU, include wriggle room for matters of sovereign risk, such as national energy supply.
Jones saw the Beyond Oil and Gas Alliance as a 'women's knitting group' by comparison and said New Zealand's energy needs were significant enough to warrant gas exploration under that 'sovereign risk' provision – meaning other international agreements were not set for some sort of domino effect.
As the Government's agenda items began to surface in 2023, chief executive of World Wildlife Fund NZ Kayla Kingdon-Bebb told Newsroom the international community's backlash against its climate policies would be harsher than the Government expected – particularly the National Party.
When New Zealand joined the Beyond Oil and Gas Alliance in 2021, it was only permitted as an associate member. Full membership hinged on a decision to ban onshore oil and gas exploration. Full members include Denmark, Ireland, France and several Pacific countries including Samoa, Vanuatu and Tuvalu.
But coalition agreements between all three Government parties committed to reversing the ban on offshore gas exploration, and $200 million was set aside in Budget 2025 to encourage exploration in New Zealand waters.
Legal advice later provided to the Ministry of Foreign Affairs and Trade said repealing the 2018 ban on offshore oil and gas 'would likely be inconsistent with the obligations in several of New Zealand's free trade agreements'.
The Green Party warned on Tuesday that, based on the assessment of an independent KC, the move breached another international commitment: the Agreement on Climate Change, Trade and Sustainability. This agreement was celebrated by Trade Minister Todd McClay last year as a 'pioneering' endeavour.
On Tuesday afternoon, McClay responded to questions from Greens co-leader Chlöe Swarbrick by doubling down on the nation's commitment to its climate targets: 'What it says about this Government is we will meet our international obligations. When we enter into them, we take them seriously.'
The following morning, New Zealand was found to have withdrawn from the Beyond Oil and Gas Alliance.
Swarbrick said the move showed the Government was 'straight up lying to New Zealanders when it talks a big game about renewables'.
'They are handing out subsidies to fossil fuel extraction beginning in a decade, cutting local energy efficiency programmes, breaching our international agreements, and now walking away from long-standing coalitions with historically bipartisan support.'
When Simon Watts assumed the position of climate change minister, he said he didn't expect a backlash from the international community as a result of lifting the ban.
As recently as November, he told Newsroom that officials assessed New Zealand could stay in the alliance while repealing the offshore ban.
But later that month, the co-chair of the alliance, Lars Aagaard, said New Zealand's status would need to be re-evaluated if it repealed the offshore drilling ban.
Meanwhile, Jones told Newsroom he'd long thought New Zealand would need to withdraw from the alliance, given the decision to resume oil and gas exploration. A departure had been 'uppermost in my mind' when he spoke to then-energy minister Simeon Brown 'quite some time back'. Jones said 'I would never have agreed for us to join up anyway.'
On Wednesday, following New Zealand's withdrawal from the alliance, Watts held his stance about international perceptions, but not about staying in the alliance.
Watts said he had received advice that withdrawing from the alliance was 'not going to have any significant impact' on New Zealand's international perception.
On June 21, New Zealand's alliance partners were notified the country would be pulling out of the alliance. Watts said these partners had not previously expressed concern over his Government's climate policies.
He said the incoming repeal of New Zealand's oil and gas ban was clear government policy, and now he was certain it would pass, withdrawing from the alliance was the right thing.
Jones, a longtime advocate for the fossil fuel sector, did not see all obligations as equal.
He said the Beyond Oil and Gas Alliance was more of a 'women's knitting group' than a firm legal commitment was the climate equivalent of the 'country women's institute'.
'You can go in and out of it.'
New Zealand's other commitments were instruments of a different character, Jones said.
'All of these international instruments leave New Zealand with enough wriggle room to address sovereign risks, and we do have challenges towards affordability and security of power.'
The Crown Minerals Amendment Bill passed its second reading in November. It was yet to pass its third reading.