Straterra launches Minerals Briefing Paper 2014

10 Apr 14

At a function in Parliament’s Great Hall on 8 April, Straterra released its Minerals Briefing Paper 2014. Straterra is the collective voice for the New Zealand minerals and mining sector, from small firms to large enterprises. Straterra’s goal is to increase investment and growth in minerals exploration and mining in New Zealand. Properly encouraged and managed, Straterra believes the New Zealand minerals sector could treble in output and on-the-ground investment over coming years.

The purpose of the paper is to explain the nature of the New Zealand minerals sector and the challenges it faces, and to provide recommendations to the government for action. The paper makes the case for introduction of policies to improve New Zealand’s attractiveness for investment in minerals exploration and mining.

New Zealand has significant potential on land in gold, coal, ironsands and other metals, and industrial minerals; and offshore in rock phosphate, ironsands, and precious and base metals, methane hydrates and other resources.

The paper notes that minerals exploration and mining is a global business. The mineral industry’s challenge is to position itself in this global market. It is a growing challenge because New Zealand’s easy-to-find resources have been mined, and society’s expectations have risen. As a consequence, technologies continue to advance, to discover and unlock resources that were previously not accessible or amenable to processing, and to manage costs. Exploration and mining today is a hi-tech industry, employing skilled people across many disciplines.

New Zealand is seen internationally to be relatively attractive as a place to invest on political, policy, rule of law, and lifestyle indicators. But the country does less well on certainty of environmental regulation. The paper notes that New Zealand could also improve on pre-competitive knowledge of resources, on access to resources, and the administration of the regulatory regimes.

The paper accepts there is a level of opposition to some or all types of mining in New Zealand. The concerns include climate change; effects on the environment particularly on biodiversity and water quality; and possible effects on human health. Events such as the Pike River tragedy have affected the industry’s reputation.

That said, public opinion surveys conducted in 2012 and 2013 reveal more than 80% support for minerals development in New Zealand, provided the environment is managed, locals are employed, and most of the money stays in New Zealand.

New Zealand’s resource management system provides environmental safeguards for society that is the envy of many nations. The paper notes that this regime provides a forum that requires robust and effective stakeholder consultation on mining proposals, and consideration of the range of interests, often competing, in reaching a decision on the granting of consents, and associated conditions.

Minerals wealth comes off a very small footprint – no other landuse earns nearly as much per hectare. The paper states even if New Zealand’s total mining and quarrying footprint on land were to treble, that area would still be less than the area of exotic forest felled every year in New Zealand, or some individual South Island high country stations. The paper cites the example that 40% of regional GDP on the West Coast comes directly or indirectly from mining, off a footprint of 14km2, compared to the total area of the region of 23,000km.

The paper sets out a series of recommendations to government, such issues as improvements to regulation to achieve more integrated, cost-effective and transparent processes, investment in aerial geophysical surveys, completed health and safety reforms, efficient allocation of research funding via the New Zealand Minerals Research Strategy, and improved political debate on minerals exploration and mining.

The Minerals Briefing paper can be found here.

Anderson Lloyd is recognised nationally as having a leading New Zealand mining law team. We are a member of, and advisor to, Straterra. For more information contact: Mark Christensen, Stephen Christensen, Ben Johnston or Maree Baker-Galloway.