New Zealand: Mining in Schedule 4 Conflict

Introduction

In March 2010, the New Zealand Government began canvassing the idea of removing land from its highly protected status under Schedule Four of the Crown Minerals Act in order to carrying out prospecting for rich mineral deposits. While releasing a discussion paper proposing a number of measures to develop New Zealand's mineral potential the Minister of Energy and Resources, Gerry Brownlee, and the Minister of Conservation, Kate Wilkinson, said a preliminary stocktake of Schedule Four land showed :

• New Zealand is mineral rich and extraction could be undertaken in an environmentally friendly way
• the mineral wealth was often highly concentrated in high conservation areas
• Schedule Four lands could be mined with little direct impact
• there was inadequate information on the potential mineral deposits and the Government wanted to improve knowledge of the "mineral estate".

The reaction to the Government's proposal was swift and vociferous. Environmental and local community groups, celebrities and opposition political parties immediately lined up against the Government, the mining industry and big business interest groups to condemn any suggestion of encroaching upon land with the highest protected conservation status in the country.

“New Zealand is blessed with magnificent landscapes, rich forests, and a unique biodiversity. We have a proud history of protecting these precious places and the species that rely on them for survival. Over many generations, New Zealanders have fought hard to protect our National Parks and other conservation areas.” This is what the Green Party of Aotearoa New Zealand web says about the unique nature in New Zealand. In this country, besides the network of protected areas, high value conservation lands (that include National Parks, wilderness areas, ecological areas and marine reserves) received special protection status under Schedule 4 of the Crown Minerals Act, according to which they are excluded from mining or exploration. (“Mining is a permitted activity on other conservation lands, but Schedule 4 lands – just 13% of New Zealand's total land mass – represent the most significant conservation lands that deserve protection from mining and exploration,” the author of the web page asserts).

However, New Zealand National Government proposed to remove 7000 ha of land from Schedule 4 and consider mining projects on a 'case-by-case' basis there. Moreover, they reckoned on further geological investigations into Schedule 4 lands, including National Parks ($4 million is to be spent over 9 months on investigating the mineral potential of Schedule 4 territories, which the Green Party considers to be a “subsidy to the mining industry”).

There are some positive steps associated with this decision: some other areas have been proposed for addition to Schedule 4 (specifically, to protect another 12,500 ha from mining, although these additions would have happened anyway). The establishment of a contestable conservation fund was planned (valued at $2-10 million annually) from a portion of future mining payments.

Conflict

There are opposing views from the side of the mining companies & government, and the local people, the general public and nature protection organizations.

Energy and Resources Minister Gerry Brownlee supported the mining project: “...7,058 hectares is just 0.2 per cent of Schedule Four land. Moreover, if that land subsequently saw mining development, only around five per cent of the land might actually be mined – as little as 500 hectares. This is nothing like the vast tracts of land suggested to date by the environmental lobby.” He also mentioned 4 principal arguments that support mining. The mining activities would be extremely efficient from an economic point of view (“an average of $360,000 of GDP per worker, nearly six times the national average”).

Solid Energy, a major New Zealand resource company, declares: New Zealanders want “...good jobs and a high standard of living. Smart well-managed use of our natural resources, combined with a conservation fund to create long-term environmental gain will allow us to have both.”

On the other hand, journalist and commentator Gordon Campbell argues that the potential mineral value of the 7,058 hectares in question is highly unpredictable until the specific resource is extracted. As no specific numbers are available, the decision ...is based on totally speculative character of economic benefits (weighted against environmental negatives) of the case he concludes.

This opinion is supported by the Press Wanaka-based consultant geologist Stephen Leary, who read two of the Government's geological reports. The figures presented there were "misleading" and "wildly optimistic" – they had not been backed up by exploration, he said. "The numbers they're throwing around, the value of the mineral wealth in Stewart Island and Great Barrier Island – it's basically just made up," Leary said.

Moreover, the actual “mineral wealth” in the conservation areas the Government wanted to be opened up is not so much rare elements, but predominantly gold and silver (also coal, gemstones, peat). Keith Ng argues that from this point of view “…the problem is that all the reports estimate the value of gold reserves based on current prices. Why is this a problem? Because the real price of gold is currently hovering around a 27-year high...”.

Conflict resolution

As there were opposing views concerning the problem, and also because nature protection was high on the political agenda in New Zealand, process of public debate on the issue was launched. This was started by the so called "stocktake" - careful analysis of existing mineral wealth and its economic potential, and continued with approximate estimation of environmental, cultural etc. potential. Negotiation process followed:

Steps in the negotiation process

The New Zealand Cabinet Papers and Cabinet Minutes chronologically list the Schedule 4 stocktake discussion documents. (Interesting: certain sections were withheld to protect the privacy of natural persons or to enable Ministers and/or any Departments or organisations to carry on, without prejudice or disadvantage, negotiations.)

• In the Release of a Discussion Paper, following procedure could be traced:

1. Stocktake = review of the areas under Schedule 4 was undertaken, inhibitors of mineral development identified
2. Government proposed to invest in gathering more information on mineral estate
3. Information obtained was released publicly to encourage potential mining investors
4. This information should above all enable to identify areas to remove from Schedule 4
5. Crown land – concerning this category, legislative change was required (addition to Schedule 4)
6. Discussion paper by the Ministry of Economic Development was prepared – seeked PUBLIC FEEDBACK:
   1. proposed for removal of 7 058 ha areas from the Schedule 4 Act
   2. proposed for adding 12 400 ha to the Schedule 4 Act
7. Six week PERIOD OF PUBLIC CONSULTATION started
8. Leaders of affected iwi were notified prior to the public release
9. New policy proposal was released for new conservation fund (conservation benefits from the mining)
10. Required reporting back on public consultation period
11. Schedule 4 areas (incl. Coromandel Region) & restrictive measures to protect them under mining were reviewed
12. Press release was made publicly available when the discussion paper was launched
13. iwi groups have expressed number of concerns – should be contacted 24 hours before release of the paper

Communication process

• Schedule 4 - Discussion paper claimed that the Ministry of Economic Development and the Department of Conservation: „…are now seeking input from the community before making decisions about … policy initiatives set out in this paper. These actions aim to make the most of New Zealand’s mineral resources in an efficient and environmentally responsible way."

All of the discussion documents were published on the Ministry of Economic Development website

Public feedback was received in the 6 week period beginning with the date of publication (March 2010) till Wednesday 26 May 2010. The consultation process started by the Government was seeking feedback from the public on a number of areas proposed for removal from and addition to Schedule. The Government stated:

• "No decisions have yet been made. The results of the stocktake are presented in a discussion paper, on which public feedback is being sought. After receiving and considering submissions on the discussion paper, Cabinet will decide on any changes to Schedule 4 in the third quarter of 2010 ... The Government is also seeking feedback on proposals for a new contestable conservation fund, a proposal to further investigate New Zealand’s mineral potential, and changes to Crown land access arrangements."

Submission questions for general public were clear, simple, and structured the answers so that they could be analysed quantitatively.

All of the potential questions to any relevant problem, and answers formulated by the Ministry of Economic Development were available in a form and language that was understandable to everybody.

Final decision

Basis of the final decisions 20 July 2010

Final decision was based upon outcomes of the consultation process: reflected views of a huge number of organizations and also individuals (who were not listed in the appendix) – see the Summary of submissions. This document represents thorough analysis of the public opinion: presents quantitative AND qualitative results.

As the media release from 20 July 2010 says: “Government was undertaking a genuine consultation process and had not made up its mind on any of the matters prior to the eight week discussion period which began on March 22. ... The government received 37,552 submissions … and the vast majority of submissions were focused on the proposal to remove 0.2 per cent of land from Schedule 4 to allow for wider mineral prospecting on those sites. Most of those submissions said we should not remove any land from Schedule 4. We heard that message loud and clear.”

Outline of the final decision

In May 2010, the New Zealand Government confirmed it no longer plans to remove any land from schedule 4 of the Crown Minerals Act for the purposes of further mineral exploration or extraction. Instead, it will focus its efforts on exploiting New Zealand's mineral wealth in areas that fall outside conservation areas. The reason for this decision was that the Government received nearly 40,0000 submissions after launching a discussion document in spring, resulting in public protest actions (street marches). The Government had been “forced to drop the plans because of the public outcry”. New areas were to be added to Schedule 4 by October 2010 as originally planned.

However, the Energy Minister Gerry Brownlee said: “I suspect few New Zealanders knew the country had such considerable mineral potential before we undertook this process and I get a sense that New Zealanders are now much more aware of that potential and how it might contribute to economic growth.”

Discussion

Not everything has been resolved despite the government decision. For example, Coromandel conservation land is still threatened by mining. The Newmont Waihi Gold company “...is actively drilling for gold in high-conservation value Conservation Park land in southern Coromandel, near Whangamata.” The affected area is regarded as “a special place – the only land with this status in southern Coromandel” because of its high conservation, biodiversity, recreational and landscape values.

On the other hand, there is a question over whether New Zealand should preserve all of its natural beauty or be somehow willing to make a compromise. The conflict in New Zealand is “…no different to that of other rich countries—how to balance economic growth with the need to address environmental degradation. But it is particularly acute in a country so dependent on the export of commodities and landscape-driven tourism. The difference between New Zealand and other places is that New Zealand has actively sold itself as “100% Pure”. Many people think they need to acknowledge “the gap between the claim and reality”, to risk the loss of reputation, because the country should “…find itself a more sustainable brand, and soon”.

Lessons learned

The New Zealand case brought interesting experience, and responses to following questions:

• What were “success” factors in rejection of the former purely economically oriented political strategy under concrete New Zealand conditions? These factors were folowing:
  • Accountability: importance of the precise assessment of the country’s economic potential (from the mineral point of view) , called “stocktake”, on one hand – and precise analysis of public views on the other.
  • Transparency: importance of the democratic consultation process – “hard data” from the stocktake (mostly on economic value of minerals) were supplemented by “soft data” on the value of culture, environment (conservation), tourism, recreation – which finally appeared to be more beneficial for communities from their point of view (see Summary of Submissions).
  • Openness: importance of having dialogue with wide variety of civic associations and NGOs in the country – which resulted in diversity of viewpoints on the problem. Communication process is of particular interest in this case study and should be further analyzed.
• Was this result based on radical ideology? Were there any general benefits of the consultation process?
  • In this case, rather than insoluble conflict was generated, more detailed “map” of the country’s economic potential was received: including the value of environmental “services” (sometimes subjectively perceived).
  • General awareness of the mineral potential of the country was raised – areas inside and outside protected zones (Schedule 4) were more carefully examined (with respect to the constraints).
  • Along with precising of the data (mapping both mineral and environmental potential of regions), also decision-making procedures were elaborated in more detail.
  • Considerations on improvement of technical mining procedures have started.

Result

The whole process might be considered as positive – it has delivered:

• more information transparently available
• more trust on both sides
• potential for the economic development - that respects democratic dialogue – was raised

Questions and proposed methods for further research

• The communication process could be investigated in more detail: what are the links between the most important factors of economic development ("economic development" could not be considered mining itself, but rather technological progress in the mining industry, the process of collation and utilisation of geological data, and the interlinking of the mining industry with other sectors, e.g. recreation), and the number, diversity, and value orientation of the responses in the Summary of Submissions?
• What are the subjective values of the environment? How could they be used as a counter-weight to the economic values?
• Institutional procedures and official decision-making processes (going on in the ministries and other institutions concerned) versus the democratic process (on the part of civic society) - what were the differences? Were there any correlations?
• Etc. - many others.

References

Other resources

Schedule 4 Review. New Zealand Mineral Exploration Association. Available from http://www.minerals.co.nz/html/main_topics/whats_new_sched4.html

Natural Riches Lie Untapped. New Zealand Mineral Exploration Association. Available from http://www.minerals.co.nz/html/main_topics/whats_new_untapped.html

--Jana Dlouha 22:02, 24 January 2011 (CET)