The oil and gas industry says it wasn't consulted on a decision to end further offshore exploration.

The government will not offer any more offshore oil exploration permits, in a move environmentalists describe as historic and opponents say is "economic vandalism" that threaten thousands of jobs

It says this year’s block offer will be limited to onshore acreage in Taranaki but existing exploration and mining rights will be protected.

The Petroleum Exploration and Production Association chief executive Cameron Madgwick told Mike Hosking a press release this morning is the first he's heard of the decision.

"It's deeply, deeply disappointing. Absolutely no consolation with the industry on an incredibly large step."

But the PEPANZ chief says the move shows the government a lack of understanding of how the sector works.

"A move like this will have an almost immediate effect on both domestic and international investment decisions in relation to the sector.

"So that can only in turn have an impact on the people who work in it."

There are 31 oil and gas exploration permits currently active and 22 are offshore.

These permits cover an area nearly the size of the North Island and run as far out as 2030. They could go an additional 40 years under a mining permit.

The ACT Party says the change will put 11,000 jobs at risk and could actually harm the environment by forcing New Zealand to buy dirtier sources of energy overseas to meet power demand.

"The oil and gas industry creates thousands of jobs, contributes $2.5 billion to the New Zealand economy and $500 million to the government in royalties each year," leader David Seymour said.

Fear of the economic costs have been strongest in the regions - Taranaki in particular - and New Plymouth mayor Neil Holdom called the decision a "kick in the guts".

"Thousands of households in Taranaki depend on the oil and gas industry and while we all want to see a more sustainable future for New Zealand we had expected to be having a comprehensive conversation about a planned and staged transition," he said.

The National Party said the move was "economic vandalism".

"Without exploration there will be no investment in oil and gas production or the downstream industries. That means significantly fewer jobs," energy spokesman Jonathan Young said.

"This decision is devoid of any rationale. It certainly has nothing to do with climate change. These changes will simply shift production elsewhere in the world, not reduce emissions."

But Regional Economic Development Minister Shane Jones said it was a "development opportunity", because existing permit holders would continue to be able to apply for extensions.

"The block offer does not affect any jobs that are already there," he said.

- additional reporting, NZN

LISTEN TO CAMERON MADGWICK SPEAK WITH MIKE HOSKING ABOVE