Dr Smith has also asked officials to advise on the options for managing the interaction between the fishery and sea lions in future.
Primary Industries Minister Nathan Guy said the sea lion fatality level was both disappointing and unprecedented. There has been an average of about three fatalities a year over the past decade, with none last year.
Observers were on board all vessels in the fishery this year, and a trawling exclusion zone was in place immediately around the Campbell Islands, Mr Guy said.
He welcomed the industry's agreement to use the exclusion devices.
But opposition and conservation groups say the exclusion devices do not go far enough.
Forest and Bird marine advocate Katrina Subedar said urgent action was needed. She said nothing was known about how many sea lions survived after passing through an exclusion device.
"For instance, they may drown after being dragged in the net too long to return to the surface. And because its body wouldn't ever be brought aboard a ship, its death would go uncounted."
Ms Subedar disagreed the number of deaths this year was unprecedented, saying officials had known for years that sea lions were being killed in this fishery.
The number had likely been under-reported due to the lack of observer coverage on board every boat in the fishery until this year, she said.
Green Party conservation spokeswoman Eugenie Sage said the effectiveness of exclusion devices has not been proven, so the Government was being "reckless" by relying on them to save sea lions.
"There is considerable uncertainty about the condition of sea lions once they escape fishing nets via exclusion devices, so the best and surest way to protect the endangered sea lion is to stop lethal fishing methods in its habitat.
"The Conservation Minister said himself that the fatality of 16 sea lions from fishing is unacceptable. The only way for him to ensure that more sea lions don't die this year in fishing nets is to close this season's fishery."
Dr Smith said he was proud of the ingenuity of the exclusion devices, which had proved very successful in the squid fishery around the Auckland Islands.
"They've been using them since the weekend on the southern blue whiting fishery, and we're just hoping that they'll equally be successful.
"It is quite complex, in the sense that the squid is quite a different fish to catch to the southern blue whiting. Our best hope is that this will enable us to be able to catch the fish and not kill the sea lion."
Both he and Mr Guy have ordered weekly reports from officials, and have also requested reports on what other measures should be considered to ensure better protection for the sea lions.
The New Zealand sea lion is listed as vulnerable and has an estimated population of between 10,000 and 12,000.
Most live near the Auckland Islands, where squid fishing has posed the biggest historical threat, while about 20 per cent live on the Campbell Islands.
