11 hours ago
- Business
- Otago Daily Times
Yes, all that glistens is not always gold
There is other, better gold than gold itself in Otago, Jonathan West writes.
Santana Minerals proposes a vast open-cast gold mine to cut through the Dunstan Mountains above the Clutha River.
CEO Damien Spring says "the gold rush has started" and his company trumpets big sums: perhaps $5 billion revenues for this small band of Australian miners and their investors; perhaps $1b in taxes and royalties for the government.
Truly impressive returns, especially for a company that's never built or operated a mine before.
What will the result be for local communities and Otago? Perhaps 200 jobs, and downstream spending.
It's too easy for Otago residents to be starry-eyed about gold, remembering the wealth sieved from shining rivers.
Yet Central's riches have long been in tourists, wine and fruits. Natural beauty, clear air and pure water underpin a booming economy doubling every 20 years. There is no shortage of wealth or jobs in Central Otago.
Acknowledging the potential financial rewards, we must equally consider the impacts and risks of open-cast mines in the region's heart for Otago's people, existing economy, and natural world.
As economist Geoff Bertram writes: "Mining will not increase economic welfare — on the contrary, it will often reduce it — if done in the wrong place, or in the wrong way, or without a proper legal and regulatory framework."
Whether a mine is a good idea is always a matter of what, where, how and who. Do we need more gold? It mostly becomes jewellery or is reburied in bank vaults.
Simon Upton, Parliamentary Commissioner for the Environment, is one person baffled by Cabinet's last-minute addition of gold to our critical minerals list, against official advice.
Santana's open-cast mine is not like the alluvial operations of Central's past. Hillsides will be cut away to open pits a kilometre wide and hundreds of metres deep. The rock will be crushed to dust and soaked in cyanide to leach out the gold.
Santana eventually expects to mine right through from the upper Clutha Basin over Thomsons Saddle to Ophir, on the Manuherikia Plain. This will outstrip Macraes, making it our biggest ever gold mine.
Other overseas mining companies have exploratory licences covering most of Central Otago, and plan to follow Santana's suit.
Climbing Thomson's Saddle, you can look back over the upper Clutha and up the Lindis with the Alps behind. The overwhelming sense is of peace in the hills, quiet prosperity in the valley.
Open-cast mining at this scale will remove the existing landscape, its life, and the traces of the past.
This is a deeply historic landscape: once the Kai Tahu pounamu trail and followed by 19th century surveyor John Turnbull Thomson coming inland to survey Otago, then the miners' town of Bendigo and pastoral stock route.
This land was also Crown-owned land under pastoral leasehold till tenure review established freeholds. The proposed mine site is recognised as Outstanding Natural Landscape and covered by a conservation covenant.
Locals name the prevailing nor'wester "the Matakanui Freight Train". Arsenic is concentrated in the rock the mine will crush, and locals fear cancerous dust storms.
Wineries and other businesses nearby depend on tourists coming for beauty and tranquillity. It is hard to see them surviving the mine.
The regional fabric of wine and food growing and tourism will very likely suffer too: the mine will be widely seen from the tourist highways or when flying into Queenstown.
It is disingenuous for Damien Spring to tell locals "It's like a chip in your windscreen when you drive by".
Placing a tailings dam above the Clutha River poses significant risks. That dam will need to hold tens of millions of tonnes of toxic rock and water slurry containing cyanide, arsenic and heavy metals.
Santana reportedly trusts the schist rock is so tight the dam can be left unlined, but seepage is a forever risk. A dam rupture would potentially be catastrophic for the Clutha's wildlife, aquifers, and drinking water of the towns downstream.
Such dam failures keep occurring across the world. So do cyanide incidents.
Santana is unwilling to commit to a bond to cover long-term monitoring or the risk that the tailings dam fails. The company is also yet to commit to the "International Cyanide Code" that regulates cyanide use.
"There will be no residual adverse effects", Damian Spring has told the local community.
The government's new fast track one stop shop exacerbates risk. Fast-tracked projects must succeed unless adverse effects are "sufficiently significant to be out of proportion to the project's regional or national benefits".
After several delays, Santana aims to apply to the Environment Protection Agency for approval by end of June. They can expect a decision this year.
A convener will appoint the four-person panel who decide if the mine proceeds. The panel will include a member of either Central Otago District Council or Otago Regional Council.
Only affected adjacent landowners, the local councils and relevant Crown agencies such as Doc have the right to "comment" on the application. And they have only 20 working days to do so. Then the panel will have just 30 more working days to reach a final decision.
Santana's application will include detailed technical reports on mine construction and effects. The company has explicitly assured local community group Sustainable Tarras and councils that, to make consultation meaningful, it would give access to such reports well ahead of the submission date.
However, the company has since reneged on this, without explanation.
Under the Fast Track law, even the evaluation panel will have limited time to ask for independent peer review or otherwise test the company's proposals. Unless the panel convener varies some timeframes, the whole process will take only 15 weeks.
The Fast Track is designed to narrow public participation, but it is possible to influence this decision. Local councils will be represented on the panel and can comment on the application. Our representatives can test all aspects of Santana's proposal.
This mine is not inevitable. If you share concerns about what this open-cast mine will do to Central Otago, it is time to speak up. Now.
— Jonathan West is a writer and environmental historian.
