New Zealand bans new offshore oil exploration to tackle climate change

New Zealand's oil and gas industry is a sizeable part of the country's economy, but it'll be stopping all new offshore exploration to address climate change.

"There will be no further offshore oil and gas exploration permits granted," Prime Minister Jacinda Ardern said in an announcement on Thursday.

The decision will only apply to new permits that are put out to tender annually, with existing licenses not to be affected. Some of these permits still have more than a decade left to go.

There are 31 oil and gas exploration permits in the country, with 22 located offshore. New Zealand's oil and gas industry contributes NZ$2.5 billion (US$1.8 billion) to its GDP, according to PEPANZ, an organisation which represents the country's petroleum industry.

For environmental groups, the move is a big step in tackling climate change. Greenpeace New Zealand executive director, Russel Norman, said the decision was a "huge win" for climate.

"By ending new oil and gas exploration in our waters, the fourth largest Exclusive Economic Zone on the planet is out of bounds for new fossil fuel exploitation. New Zealand has stood up to one of the most powerful industries in the world," Norman said.

WWF-New Zealand CEO Livia Esterhazy hopes the announcement will spur renewable energy investment from oil and gas industries. "That's the way of the future," she said.

PEPANZ argued the ban would "do nothing" to reduce greenhouse emissions, and that renewable energies are not yet adequate at fulfilling the country's energy demands.

“We ask the Government to talk with the industry urgently. In the meantime, we will be carefully considering the ramifications of this decision and our options going forward," PEPANZ CEO Cameron Madgwick said.

New Zealand's not the only country to halt oil and gas like this. Last year, France announced it would ban all oil and gas production within the country and in its overseas territories by 2040.