New Zealand Government to Expedite Approval for New Mines

The newly elected New Zealand conservative coalition government has announced it will introduce legislation to fast-track applications for new mines, signaling a complete reversal of the previous policy.

In her 2017 Speech from the Throne, former Prime Minister Jacinda Ardern announced Labour’s commitment to no new mines on conservation land. One-third of New Zealand’s land is classified as being in the conservation estate.

Mining industry lobby group Straterra responded that the proposal “made no sense,” claiming “not all conservation land has high conservation value.” It also pointed to the fact that it would result in the country losing jobs, overseas revenue, investment, export markets, taxes, and funding that could help manage and improve the conservation estate.

The ban, Straterra said, “[risked] destroying livelihoods in important regions and wiping out entire communities.”

Three-quarters of mining on conservation land occurs on the South Island’s West Coast, where there are few other sources of income beyond tourism.

Nationally, 7,000 people are employed in the extractives sector and the economic contribution to GDP is $2.61 billion (US$1.63 billion) annually.

Immediate Problems

The proposed legislation immediately encountered problems, including the risk that it would put the Crown in breach of its Treaty of Waitangi Settlement with the Ngāi Tahu iwi (tribe), which granted it rights to mine pounamu, or greenstone. Ninety percent of the iwi’s pounamu is sourced as a by-product of third-party mining operations.

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When initially announced in 2017, the proposal was not supported by Labour’s coalition partner New Zealand First, which now forms part of the current three-party government along with National and ACT.

Progress also wasn’t helped by Labour changing conservation ministers three times in 12 months.

But with a new government in place, boasting an ambitious program for its first 100 days, many restrictions on business and industry are set to be removed, including allowing projects, like a large gold mine in Central Otago, to not only go ahead but to be able to do so more quickly.

However, Minister for Resources Shane Jones—a New Zealand First MP—has said that environmental protections will remain in place.

Planning Underway for a New Gold Mine

Santana Minerals, which is listed on the Australian Stock Exchange, has estimated its proposed mine at the company’s existing 272 square kilometer site could yield between 100,000 and 150,000 ounces of gold each year, which would earn a minimum of $325 million a year at current gold pricing.

The company’s chief executive Damian Spring characterized the coalition as a “pro-mining government” in a radio interview, and confirmed they had briefed Mr. Jones in December.

The minister has said he wanted to “convince investors, convince the industry, that I can deliver a level of certainty for them, so they can spend their own money and secure the consents within the statutory framework passing for resource management and mining.”

Acknowledging that mining activity could contribute adversely to climate change, Mr. Jones said, “There are always trade-offs. I’m going to ensure that those trade-offs are put in front of the people of our nation and decided upon on the basis of science, economics, and a robust understanding as to what are the cost benefits.”