Cancel the Gold Rush

Blogger: Forest & Bird’s North Island Conservation Manager, Mark Bellingham

Back in the day, I was what you’d call a rock man.

I did my undergraduate degree in geology, and since then I have kept in contact with people in the industry.

The industry is a tight-lipped one, but this Geological & Nuclear Science report the government is basing its predictions of ‘$194 billion of mineral wealth’ has lots of geologists shaking their heads.

Insiders in the minerals industry who have pored over the discussion document are shocked at the highly optimistic estimates, the woeful lack of science and the tendency to gloss over the environmental impacts of these mines.

Untapped potential?

NZ’s ‘untapped potential’ has been vastly overstated in the discussion document. The estimates are not based on science but are desk top ‘guesstimates’. For most of the areas no fieldwork was conducted or samples taken during the stocktaking exercise.

The rationale behind pouring $4 million of taxpayers’ money into exploration has stunned the geological community.

Once exploration takes place the chances of actually stumbling upon a mineral bonanza is minimal (we’re talking thousands to one).

Exploration funds are hard to come by these days, however  if they were mining companies were to look into mining our land there are plenty of places they’d look first before even considering our schedule 4 conservation land.

The reality is that these overseas mining companies are more than happy to spend our taxes, exploring for minerals in the full knowledge that the chances of finding nothing are very, very high.

It will, however, set a precedent and allow them to crack open our special wildlife reserves whenever certain minerals ‘du jour’ hit bumper prices.

Trouble is, often these prices are especially volatile.

Gold – Riding on a 27 Year High

As many of you will know, as a result of the recession, people have plunged their money into the safe haven that is gold and it is riding at a 27 year high.

I am no economist but because mining requires so much capital input a project that may seem feasible one year, is completely unfeasible the next.

It’s a boom and bust industry.

Gold prices are cyclical – so exploration geologists need to know how to flip burgers, deliver pizzas or drive a taxi for the down times.

And given that the average mine takes 15 years to become operational, these prices may well be in quite a different place in, let’s see, 2025.

Surgical mining? Yeah right,

One of the key points to come out of the discussion document is that mining operations will ‘minimise the environmental impact’ – which is misleading and contradictory.

Unfortunately mining lobbyists (and politicians) may have the best intentions to preserve the environment, but it depends on the geology of the area.

Most (economically viable) mining in our high value conservation estate would be open cast (i.e a rather large hole).

Underground mining is much more expensive than open cast mining. The reason: underground tunnels must be excavated, it takes complicated engineering and smaller trucks must be employed to extract the rock.

To justify underground mining of this sort high grade, high concentration mineral deposits must be found – from the GNS reports this is an unlikely scenario.

High Value Minerals  in the Conservation Estate

Our high value conservation estate has already been picked over by gold-diggers from the 1860s till the 1900s, before our national parks were established.

The old timers did a great job of finding all the easy stuff.

And while we have better technologies, exploration is not getting any easier as there are only marginal traces of mineral deposits, or there is a very good reason why they haven’t been located e.g they’re buried very, very deep.

In the unlikely scenario that miners do find something of value beneath our conservation areas, it’s unlikely that your average New Zealander will benefit, because the royalties on these minerals stand a minuscule 1% (not counting gold, which is 5%).

In short, mining our precious conservation land will dig a hole that we may never climb out of – let’s safeguard these areas for the future!