Miner’s Monthly: November 2020

Only time will tell the implications of election result

Whether there will be any relief for the minerals sector due to the Labour-NZ First- Green Party coalition becoming a Labour Party dominated Parliament remains to be seen. Green co-leader, James Shaw, has retained his position as minister for climate change, Megan Woods and David Parker have both continued as ministers for energy & resources and environment respectively. The most notable change is that of minister of conservation from Green Party MP, Eugenie Sage to Labour’s East Coast MP, Kiri Allan, who so far remains an unknown quantity. There have been mixed messages on whether the previous coalition’s pledge of ‘no new mines’ on conservation land will be carried through as a priority this term. Minerals West Coast will continue to engage with government staff and elected representatives to argue for ongoing mining industry access to public conservation land in a socially and environmentally responsible manner on a case by case basis.  

Other policy changes still on the horizon

Along with the ever elusive commitment on no new mines on conservation land, the previous government had other policy proposals that were of concern to the mining industry. These included a National Policy Statement on Indigenous Biodiversity (NPSIB), changes to the Crown Minerals Act, and proposed bans on some coal boilers along with a levy on coal use.

National Policy Statement for Indigenous Biodiversity

Some of the proposals of the NPSIB could be incredibly costly for regions like the West Coast that still have large areas of native vegetation and small rating bases. Of greatest concern is the requirement for local authorities like the West Coast Regional Council to identify and map significant natural areas (SNAs).

A joint submission from the Buller, Grey, and Westland District Councils, and the West Coast Regional Council, outlined the issues with the draft statement. 

The councils’ submission drew attention to the area of the West Coast already protected by being under Department of Conservation management, and the cost of implementing some policy proposals.

Map showing area of West Coast protected as part of the conservation estate.

For example,  the West Coast Regional Council estimated the upfront cost of of implementing the policy were as high as $4,172,000, and an ongoing cost of potentially $3,949,000 over the next 30 years – this doesn’t include direct costs to landowners and iwi, or other affected parties.

To put this in context, the annual general rating income for the West Coast Regional Council is about $2,400,000.00.

The joint council submission can be found in full here.

Boiler bans and coal levies

Just before the election, the government published the submissions on its discussion document Accelerating renewable energy and energy efficiency in which proposals had been floated on banning some existing coal boilers by 2030 (where the end use temperature is below 100°C) or banning new coal boiler installations after 2030 where the end use requirement is below 300°C, along with a levy charged on coal users per tonne of coal consumed. Coal production is already levied on a per tonne basis when it is sourced from the mine, and use is already charged through the NZ Emissions Trading Scheme. 

Labour Party campaign advertisement 2020.

The Labour Party included the ban on new boilers in its election manifesto, but didn’t mention a ban on existing boilers, or a coal levy.  What the government’s actions will be remains unclear. 

In the South Island, coal remains essential for the production and processing of dairy and meat products, and hothouse crops like tomatoes, capsicums, cucumbers, and eggplants.

Food producers such as Westland Milk Products, the Meat Industry Association, and Horticulture New Zealand all expressed their concern at the impacts the coal targeted polices could have on the viability of their industries in the South Island. 

In its submission, the Meat Industry Association said in its submission that a “total coal ban would incur very significant costs to the industry”, and it estimated “cost of tens of millions (of dollars) in conversion of existing coal boilers to biomass, and additional annual operating costs. Many of the South Island sites (but also some in the far north) are in areas where wood chip supplies are likely to be in short supply, making biomass unfeasible”. 

Westland Milk Products stated in its submission that the eventual conversion from coal to some form of renewables is ‘inevitable’, but stressed for the foreseeable future there are no alternatives. In its submission, Westland Milk Products said it would be “unable to access the same level of reliable energy from electricity generation due to capacity constraints on the West Coast”. It said this would not change even if the proposed Arnold or Waitaha Hydro schemes were to proceed.

The most viable alternative to coal would be wood pellets, but the investment required would possibly cost $100,000,000 over the life of the plant. It said this “could be the difference between being viable and unviable” due to the uncertainty of supply and transport logistics. 

In a joint Horticulture New Zealand, Tomatoes NZ, and Vegetables NZ submission, hothouse growers said plainly “there are no viable alternatives to coal boilers”, and that growers cannot afford the cost of transitioning”.

Radio New Zealand covered these issues on its Morning Report programme earlier this month. The story is available below.

Minerals West Coast Forum 2020 well attended

The Minerals West Coast 2020 forum was this year held in Reefton in September. In all about 100 delegates attended, with the event limited to that number due to the alert level two restrictions in place at the time. The focus for the 2020 forum was on the products and the outcomes of mining. Steel manufacture, food production, gold mine security, jewellery, kiwi monitoring, and water quality control were among the topics speakers covered. As well as a good line up of presentations, the event was a good chance for people in the industry to connect and catch up throughout the day and in the evening at the post-forum dinner and drinks. It was good to have attendance from West Coast local body politicians and local MPs from both the Labour Party and National Party in attendance. Machinery exhibitions from sponsors such as Aratuna Freighters, CablePrice NZ, Oceana Gold, West-Trak, and Rosco Contractors Ltd. also added to the atmosphere on the day. The day also included the launch of Minerals West Coast’s industry factbook, Prospects for the future, which is available in its digital form on Minerals West Coast’s website – click here to find the online copy.

School of mines tour and visit to stamping battery

The next morning a small group of people, if not a little worse for wear from the night before, were hosted by Reefton geologist, John Taylor, for a tour of the Reefton School of mines followed by a trip to the working model stamping battery at Crushington. Reefton resident, Bill Watts, hosted the group and showed the stamping battery in action.

Golden Globe Theatre opened in Reefton

Later the same day, Bill Watts, whose grandfather had worked in the historic Globe underground hard-rock gold mine, cut the ribbon on the Oceana Gold funded ‘Golden Globe Theatre’ in the Reefton i-Site. 

In the theatre, people can see the story of gold mining in Reefton generally and the Globe and Progress mines specifically. The video is available below.

Pandemic impact on coal export sector highlighted on One News

In October One News visited Stockton mine to look at how the coal export sector has been impacted by the international drop in coal prices resulting from the Covid-19 pandemic. The story can be viewed on One News’s website – click here to watch the full video.

Bathurst Resources community sessions

Final mining session for the year on RNZ Nights

In the past calendar year, Minerals West Coast manager, Patrick Phelps, has appeared on RNZ National’s evening show, Nights with Bryan Crump, about once every ten weeks to discuss different topics relating to the mining industry on the West Coast. The final interview slot for the year was in the second week of November, and covered the future of mining on the West Coast. The interview is available below. An earlier interview about mining on conservation land, from September, is also available.