Scoop Election 08: edited by Gordon Campbell

On the Government’s Greenlight to the Mining Industry

March 23rd, 2010

Gerry Brownlee coal cookie monster – national park mining - Image: Fredd Marshall
Image: Fredd Marshall

Click for big version

Well, we learned yesterday that Forest and Bird leaks had been right all along, and that the government is indeed planning to take 7,058 hectares of land currently under Schedule 4 protection (because it had been judged to be crucial to the conservation estate) and to hand it over to mining companies.

To mining companies that will then conduct the keyhole, environmentally sensitive, pinpoint exploitation that John Key, Energy Minister Gerry Brownlee and Conservation Minister Kate Wilkinson assure us will be the only form of mining allowed in these sensitive areas on the Coromandel, Great Barrier Island, and the Inangahua section of Paparoa National Park. If you believe there is such a thing as mining with an invisible footprint, yesterday was a very big day for you.

The maths of the exercise though, are still completely wonky. At Brownlee’s press conference I asked him the estimated potential mineral value of the 7,058 hectares in question. “Something in the vicinity of $60 billion,” Brownlee replied, adding : “ I stress that this is totally back of the envelope…Until you have someone recovering that resource you just don’t know..”

And with reference to the $18 billion allegedly now up for grabs in the Coromandel region, Brownlee said much the same thing : “These numbers are only indicative of the sort of resource… the reality is that until there is activity going on, you just don’t know what that flow of cash might be. But that’s a number… that’s big enough that it may encourage you to do the investigation that may lead to mining.”

So if you’re a mining company… just suggest a big enough number for the value that might be there, and chances are, the Key government will deem it worthwhile to let you to go drilling in some of our most sensitive ecological areas … just to, you know, find out how accurate your initial rosy guestimates really were. Does that sound responsible – or does it sound more like the government is playing Russian roulette with the conservation estate?

Moreover, Brownlee and John Key have both been stressing that the government will finally decide on whether this mining should proceed only after it has weighed the proper balance between the likely economic benefits to the nation and the environmental risks that mining would pose.

Yet according to Brownlee yesterday, we won’t know anything resembling accurate economic values until after the companies have actually started doing the mining! How then, can the balance be assessed beforehand? Obviously, it can’t. The figures being plucked out of the air are really about wooing public opinion – look, there’s an El Dorado waiting for us out there. They have little or nothing to do with realistic economic planning.

This is where the further problems with the maths kick in. Within the discussion document, the estimated value of the main ingredients of the mineral wealth of New Zealand are said to amount to $194 billion. Yet, as Brownlee has said, the allegedly surgical exploitation (the access roading and millions of tons of toxic waste? Why, you won’t even notice them!) of this tiny Schedule 4 area to be infringed is estimated to be worth $60 billion – which is nearly one third of the estimated value of the mineral wealth of the entire country. It doesn’t make sense. Either these estimates are completely cockeyed – or else some very heavily intensive mining of these areas is being contemplated.

As Scoop has already reported, the government has chosen to be entirely reliant – when it comes to assessing the potential economic value of the minerals it is enabling the mining companies to plunder – on the work of Richard Barker, a mining industry consultant and office holder within the mining industry.

As indicated above, the industry has a vested interest in talking up the potential economic values, and the government seems quite happy to be the mining industry’s captive on this crucial point. So much for Key’s assurance – at last week’s press conference – in a reply to a question from Scoop as to whether the government would be relying on its own independent valuation of our mineral reserves, or would be reliant on figures supplied by the mining industry, “Primarily the former,” he replied. Plainly, that is not the case.

The government’s latest estimate of our potential minerals wealth is now $194 billion, and is still almost entirely Barker reliant. As the discussion paper reveals, the government has simply added his initial figure (derived from his highly speculative 2008 study) of $140 billion nationwide, to a $47 billion figure that he had elsewhere estimated for Northland alone, and then added $7 billion from another mining industry study and rounded them all up to $194 billion.

This figure could hardly be more shonky, and represents a ‘back of the envelope’ exercise – as Barker has confessed it to be in the NZ Herald last year. Even then, this figure is for gross worth. It bears no relation to the figure that would actually accrue to New Zealand, once foreign-owned mining companies have extracted the mineral wealth, and taken the lion’s share of the profits offshore.

Regardless, this $194 billion figure is being peddled to the public as the economic justification for opening up Schedule 4 lands to the mining industry, and with the prospect of more to come – since the 7,058 hectares proposal looks like a pilot study for further mining activity in future. If the government can get away with its current proposal, additional large scale mining on conservation land will almost certainly follow in its wake. Public submissions on the 7,058 hectare plan will close on May 2nd.

As a sop to environmentalists, some of the royalties from mining on conservation land will be diverted into a new Conservation Fund, with those royalty contributions to be capped at a maximum of $10 million a year. The monies in the Fund will then be used to support community conservation projects around the country.

Leave aside the irony of a major plundering of the conservation estate being the funding source for minor conservation projects elsewhere in the community – at yesterday’s press conference, Conservation Minister Kate Wilkinson was asked whether the “independent” panel that will be overseeing the disbursement of those monies will be forbidden to fund front organisations linked to the mining industry. This is a genuine concern, given that in the recent past, Timberlands had fostered community groups on the West Coast that publicly supported its activities. In reply, Wilkinson cited with approval the environmental efforts of companies like Solid Energy. “I’m not ruling anything out or ruling anything in,” she concluded.

In time then, the Conservation Fund could well end up funding the community P.R. branches of the mining industry. Neat.

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    1. 13 Responses to “On the Government’s Greenlight to the Mining Industry”

    2. By richarquis on Mar 23, 2010 | Reply

      It is indeed interesting to note his continued use of the word “primarily.” Cut through the semantic BS, and it translates as “We will rely FIRSTLY on the former, but when that doesn’t suit us, we will then rely PREDOMINANTLY on the latter.” More National weasel words. Verily, the emperor still hath no clothes.

    3. By esther on Mar 23, 2010 | Reply

      Just reading about this makes me kind of nauseated. NZ’s known for it’s 100% Pure campaign. How can it maintain such an image whilst giving mining companies the go-ahead in protected areas? Is there any way to stop this? From what I can gather, there’s no concrete research & statistics backing up the Govt’s claim of “billions’. Seems to be a figure plucked out of the air. Also it begs the question.. where will the billions go? A small portion to go to conservation? What a laugh! Was the govt ‘silenced’ (ie $$) by the mining companies? Considering that they’re basing their facts from a person who works with the mining companies.. it does make one wonder..

    4. By Piet Visser on Mar 23, 2010 | Reply

      The people who don’t want mining in our most sensitive conservation areas, should understand the history of John Keys reign so far:
      As with the ACC costs to motorcycles, Keys needs to pass something unacceptable, so he is going to shoot way higher than he intends. After much protest, Keys will make a “Compromise” and the protest groups will walk away with what they think is a victory.
      The referendum showed that Keys places little value on that the public want, and that the New Zealand public don’t stand up for themselves.
      Google “John Keys Lies” and you will find that during his term as ruler, he has been rather dishonest, event for a politician. The main theme, has been dishonesty about his intentions, so when he says it is just a postcard, understand that he means the last postcard what will be sent from that part of the country.

      The end result of this is that the protected areas are going to be mined by foreign companies.
      At first it will be a small area, out of site. But later, with out the need for public consultation, more areas will open up, and not just for mining.
      While you are worrying about the wildlife of these areas, you should give a through to the people who will be harmed… Google “mining water pollution” and have a good read.

      We are going to compromise with this salesman, and our failure will be complete.

    5. By Jum on Mar 23, 2010 | Reply

      The incorrect assumption we are making here is that this government actually gives a damn.

      If you watch Nigel Latta on what makes criminals tick you will see that these people are wired differently to those people who care about their children, other people’s children, the world they live in, their children’s future world. More importantly, most of us think holistically, in a rounded way. Money is not the total driver. Once you can eat and gain shelter and clothing, pay your bills and access education health care and some entertainment, most people then tend to share their ‘wealth’ with others.

      This group in government are quite different. Money is the goal, and more money after that.

    6. By Joe Blow on Mar 24, 2010 | Reply

      Why can’t National get back to conspiring to sell off our state assets instead of hocking off our most precious resources? I’d prefer to lose ACC or Kiwirail rather than our National Parks. National is whoring what we should hold most dear for short-term tricks….

      Unlike privatisation of state assets this policy direction is absolutely irreversable… need I say more?

    7. By Wayne McIndoe on Mar 24, 2010 | Reply

      Thank you Gordon for a detailed costs analysis of the so-called economic benefits or non-benefits of mining on our national parks once the mining companies have done the work the ecological impact would be irreversible

    8. By David on Mar 24, 2010 | Reply

      One other thing i noted- looking at the maps provided on stuff – is that many of the proposed areas are in the upper catchments of streams flowing into settlements -e.g. Otuhu and Parakawai are in a catchment that flows into Whangamata, Broken hills into the estuary of Pauanui, Inanguhua into river that flow into the village and, down the line, Westport, Tokotea down to Coromandel. The other location, being the Te Ahumata Plateau, being a plateau, probably also has a bunch of streams running into the coastal waters. Apart from the impacts on conservation values, there are risks of an unknown quality, to the local populations.

    9. By mike on Mar 24, 2010 | Reply

      And as was pointed out on RNZ yesterday, there has been no assessment of the impact that moonscaping the DOC estate will have on tourism.

      All those pie-in-the-sky billions have to be put in perspective, offset against the destruction of the NZ brand. Considering tourism is our largest export earner, together with dairy, it seems an incredible gamble.

      It astonishes me that the tourism industry isn’t making a bigger fuss about this.

    10. By Jum on Mar 24, 2010 | Reply

      Mike
      The Minister of Tourism obviously chose his portfolio for the reason of not wanting to defend it.

    11. By stuart-munro on Mar 25, 2010 | Reply

      The real problem to me is that these samfs are obviously just going to keep up this crap until we the people stop them.

      They don’t respect public opinion, polite requests or referenda. Looks like the fallback option is small calibre ostraka.

    12. By mike on Mar 25, 2010 | Reply

      And when is the mainstream media ever going to investigate the links between the Nats and the international Big Mining firms that are going to profit most?

      http://www.thestandard.org.nz/keys-mining-plan-a-pay-back-for-crosbytextor/

      Oh, busy with their day job fanning the smokescreen of minor issues and ‘human interest’ faf.

    13. By jenese james on Mar 26, 2010 | Reply

      wake up you lot – national doesn’t wake up in the morning and say oh because we sold off the china and are now broke i think we will let offshore mining companies come into our ancient forest national parks no less and mine – that should be wroth something to the empty coffers

      wake up – something else is driving this – its like NZzzzz has been ordered to open its parks for corporate mining and national politicians are simply the puppets that have to sell the idea to the sheeple

      wake up also to the fact that mainstream media have sold you out decades ago – your news is managed – your view of reality manipulated all to get you to stay where you are – in front of the tele eating crap food, and focused solely on making a living and supporting sport for entertainment or watching porn or any other things that pass for ‘entertainment’ in the main stream world that way you won’t be bothered thinking for yourself and if you did manage to do that – you wouldn’t have the energy to change anything

      go do some research find out who is dictating the terms here – and you will find – just like CODEX – that its not the NZzzzz government its something out of their control

      go do some research look and see what our loan agreements with the IMF or the WB or even the terms of trade with the wTO say in the fine print

      just wake up and realise that NZ is dictated to and all this mning talk is just political wank to hard sell orders from off shore

    14. By rhys on Mar 27, 2010 | Reply

      our land prepares for slaughter
      its songs should be heard
      where are the protests of elders

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