Updated April 12, 2018 17:34:54

Permits for offshore oil and gas exploration will no longer be issued by the New Zealand Government as part of its commitment to a clean energy future.

The move will not affect existing permits for exploration or extraction, meaning the industry is likely to continue in the nation for several more decades.

The decision under Labour Prime Minister Jacinda Ardern is a change in direction after nine years of conservative leadership which favoured expanding the industry.

Ms Ardern, who was elected Prime Minister last year, has pledged to reduce the country's net greenhouse gas emissions to zero by 2050.

Her Government also plans to plant 100 million trees each year and ensure the electricity grid runs entirely from renewable energy.

The oil and gas industry is relatively small in New Zealand, employing about 11,000 people and accounting for about 1 per cent of the overall economy.

It is dwarfed in importance by farming and tourism.

But the industry is important to the Taranaki region, where most of the activity is centred.

New Plymouth Mayor Neil Holdom told Radio New Zealand the move was a "kick in the guts for the future of the Taranaki economy".

But Ms Ardern said no-one would be losing their job as a result of the move.

"We're striking the right balance for New Zealand," Ms Ardern said.

"We're protecting existing industry, and protecting future generations from climate change."

Move described as 'economic vandalism'

Photo: Ms Arden's announcement was applauded by Greenpeace and environmental groups. (ABC News)

But New Zealand National Party MP Jonathan Young described the move as "economic vandalism".

"This decision is devoid of any rationale. It certainly has nothing to do with climate change," Mr Young said.

"These changes will simply shift production elsewhere in the world, not reduce emissions."

The idea of an expansion in offshore drilling has proved contentious in New Zealand, particularly after problems elsewhere like the 2010 Deepwater Horizon oil spill in the Gulf of Mexico.

Environmental group Greenpeace welcomed Ms Ardern's move.

Russel Norman, the group's executive director in New Zealand, said the country "has stood up to one of the most powerful industries in the world".

The announcement does not apply to onshore exploration permits.

The Government said those would continue for the next three years and be reviewed after that.

AP

Topics: oil-and-gas, industry, environment, environmental-policy, new-zealand

First posted April 12, 2018 15:10:20