OPINION: If you wade into the water at Takapuna Beach and head in a north-easterly direction for about 11,500km you fetch up in El Salvador, a small country with an aversion to gold mines.
This aversion has led to a spot of bother for NZX-listed OceanaGold, whose assets include a gold mining project in El Salvador called, of course, El Dorado.
As the desire to dig for gold at El Dorado encountered the El Salvador government's desire for an absence of digging, a legal dispute arose under the auspices of a free trade agreement covering five central American countries, the United States and the Dominican Republic.
Many people are alarmed at the idea of corporates taking legal action against governments and are concerned about New Zealand being exposed to litigation through the Trans Pacific Partnership, a proposed free trade agreement covering 12 Pacific Rim countries.
The concern is understandable, but Chalkie reckons El Salvador shows us why free trade deals are not the bogeymen some think they are.
First up, how does Oceana, whose main claim to fame is its Macraes gold mine near Dunedin, get itself involved in El Salvador?
Oceana, headquartered in Melbourne, domiciled in Canada, first got into El Dorado in September 2012 when it bought 20 per cent of North American mining minnow Pacific Rim.
It bought the other 80 per cent last November, paying for it by issuing shares to the value of US$11.3 million (NZ$13m). Its total investment in Pacific Rim was valued at US$14.1m as of December 31.
Pacific Rim's big thing was El Dorado. It had potential for at least 300,000 ounces of gold (an estimate later significantly upgraded), was located in a poor, sparsely populated part of the country and a mine's surface facilities wouldn't disturb residents because they could be placed on a former cattle ranch, "while at the same time providing hundreds of well-paid, skilled jobs for the community".
After acquiring the El Dorado project through a corporate merger, Pacific Rim set about filing the government paperwork to develop it.
At this point we should pause to reflect on the nature of government in El Salvador.
This is a country only recently adjusting to the idea of democracy and the Left/Right political divide is deep after a 12-year civil war that ended in 1992.
A general election held last month produced a win for the Left-wing Farabundo Martí National Liberation Front, but only by a tiny margin of 6364 votes.
New president Sanchez Ceren was a National Liberation Front guerrilla commander in the civil war. His opponent Norman Quijano represented the Right-wing Arena party, the Front's enemies in the war.
When Pacific Rim was developing its El Dorado project, Arena was in charge. The Front has been in control since 2009.
However, both sides are dealing with economic weakness - the country has a population of 5.7 million and 42 per cent of them live in poverty. Much of the country's money comes from former citizens living abroad who send remittances home.
It's the sort of place you'd call a banana republic. It's also the sort of place corporates worry about investing in for fear of their work being stymied or stolen by capricious or corrupt governments.
According to Pacific Rim's chief executive Thomas Shrake, the El Dorado project was satisfactorily going through its procedural hoops with apparent government approval until 2008 when the then president Tony Saca announced the Arena government would issue no new mining permits.
El Dorado was stopped in its tracks.
Shrake later told Canadian radio programme Sunday Edition: "I think it's all about corruption.
"I think we were being squeezed by Saca. Certainly it has that history. We don't pay to play."
In June 2009, Pacific Rim filed a complaint against El Salvador with the International Centre for Settlement of Investment Disputes (ICSID), an arbitration body set up by international treaty.
The specifics of the claim are so long and detailed that Chalkie can't traverse them here, but in essence Pacific Rim claimed El Salvador had acted unfairly and arbitrarily, had failed to follow its own law and illegally expropriated Pacific Rim's investment.
In compensation, the company wanted US$77m for its out-of-pocket expenses plus an unspecified sum of potentially hundreds of millions for lost profits.
Chalkie can see why Pacific Rim felt aggrieved.
It spent all that money and did all that work, only to have the goalposts not just moved but taken off the field completely.
Add in the reports of increasing corruption in El Salvador under the Saca presidency subsequently, and you have a climate in which companies are fortunate to have rights of appeal to an external referee.
It's also worth remembering this is a referee that El Salvador has agreed to use, having signed up in 1982.
In 2009, the Pacific Rim dispute was one of 25 new cases brought before the ICSID. About a quarter of all cases involve the oil, gas or mining industries.
Of course, there are two sides to every dispute and El Salvador has vigorously rejected Pacific Rim's claims.
Another side to El Dorado is presented in a report published last month by several non-profit organisations, including Oxfam, the Institute for Policy Studies in Washington and Mining Watch Canada.
Entitled Debunking Eight Falsehoods by Pacific Rim Mining/OceanaGold in El Salvador, it argues that Pacific Rim did not follow regulatory requirements to develop El Dorado and instead relied on political lobbying, fuelling corruption in the process.
It also argues that there was widespread opposition to mining in El Salvador and that the company's appeal to the ICSID subverts the democratic rights of citizens to decide how mining is regulated.
Concerns about the mine's effects on water, which is often scarce, have not been properly addressed, it says.
Alarmingly, it cites cases of violence against anti-mining activists including several murders such as that of Marcelo Rivera, whose body reportedly had signs of torture - Chalkie will spare you the grisly specifics - when it was found in a well in June 2009. The company is not implicated in the violence, but critics point out that the tensions over El Dorado have become a matter of life and death for locals.
Meanwhile, the legal costs mount - ICSID documents indicate El Salvador has incurred legal fees of more than US$3m fighting the claim.
Then there was the bizarre tax haven thing. Pacific Rim had structured El Dorado through a Cayman Islands subsidiary for tax reasons, but in December 2007 redomiciled it to Nevada in the US. The company said this change was nothing to do with the fact that Cayman Islands companies were not entitled to complain to the ICSID.
Whoops, unfortunately its intention to go to the ICSID was revealed in October 2007 to a lawyer it tried to recruit for its case. The lawyer, Luis Parada, ended up working for the government of El Salvador.
This sort of stuff has kept the dispute grinding away for years, with the ironic result that in 2012 the case was ruled outside the jurisdiction of the tribunal under the free trade deal because Pacific Rim was Canadian, but inside its jurisdiction under El Salvador's domestic law as a signatory to the ICSID convention.
While the time taken to reach this conclusion is ridiculous and the substantive case is yet to be decided, Chalkie reckons the tribunal is a good thing.
For Pacific Rim, it provides a forum for appeal, for El Salvador, it encourages governments to follow legal process.
The arguments on either side are contentious, but the tribunal will help establish the facts and administer justice.
What's wrong with that?
Chalkie is written by Fairfax business bureau deputy editor Tim Hunter.
Do you think the appropriation of the Native American headdress for a fashion show is offensive?Related story: Dame Trelise under fire for headdress use