Economic boom or environmental folly

"The area we are looking at right now is 100 million tonnes"

MATT RILKOFF
Last updated 05:00 10/11/2012
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The mining of Taranaki's black sand seabed for iron ore is looking increasingly likely.

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The colour of gold could soon be black.

After years of false starts, wild speculation, outrageous optimism and vehement opposition, the mining of Taranaki's black sand seabed for iron ore is looking increasingly likely.

At the head of the pack is the New Zealand-registered but foreign owned company Trans-Tasman Resources Ltd that holds prospecting permits covering 6332sq km of seabed off the South Taranaki coast.

Established in 2007 to literally suck up the rich sands off Taranaki's coast, the company counts former prime minister Jenny Shipley as one of its seven directors, and the only New Zealand one.

Its public face in TTR's multibillion-dollar aspirations is former New Plymouth man Andy Sommerville.

"We don't fully know what the extent of the resource is out there," he says.

"We think the area we are looking at right now is 100 million tonnes. If we were mining that at five million tonnes a year that would come out at a 20-year life for that mine.

"Assuming of course the environmental effects are acceptable and everyone is happy about it there are probably a lot of other areas out there which are potentially of similar quality and are just as mineable."

Its application for exploration permits is expected to be passed before Christmas, which would put it one step away from the all-important mining permit it will apply for next year.

That application will trigger a resource consent process involving public consultation and various government regulators, including the newly established Environmental Protection Agency.

TTR is calculating on this process ending in a mining permit by mid-2014, with mining to start up to two years later. That would see between five and 10 million tonnes of iron ore dredged from the seabed each year.

Worth up to $1 billion, the company's own rough estimates are that 80 per cent of this could stay in New Zealand.

TTR proposes to process the sand and remove the ore at sea, then ship it directly to China. If it goes ahead it will all happen between 12km and 35km offshore in water depths of 20 to 45 metres.

At a minimum the seabed will be sucked up to a depth of 5m, increasing to 15m further out to sea, with the sands containing eight to 20 per cent iron ore.

Assuming the percentages are correct, between 25 million and 62.5 million tonnes of sand will need to be dredged for the five million tonnes of iron ore TTR initially hopes to ship each year.

And while the dredging and processing elements of the business are old hat, the scale and the offshore location are essentially a world first.

"We are very cautious and very considered at this stage," says Debbie Packer, of South Taranaki iwi Ngati Ruanui.

With an area of coast stretching from Hawera to Patea, Ngati Ruanui is the principal iwi in discussions with TTR.

Despite Mr Sommerville saying iwi have been excellent to work with, Ngati Ruanui opposed their permits because of a lack of quality information about the environmental impacts of their proposal.

Ms Packer is diplomatic when discussing their relationship, but says the iwi is frustrated to still be waiting for that information while TTR pushes ahead with its plans.

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"If the company is going to have this type of activity, it's important the information is at the front end," she says.

That information may be coming but it's not here yet. TTR has commissioned Crown-owned research and consultancy company Niwa to complete several studies and develop models to predict what will happen if mining begins.

Of concern are the massive holes that mining will make, the impact of returning tailings into those holes and whether sand from South Taranaki beaches will be slowly sucked out to sea to fill the gaps the millions of tonnes of extracted ore will leave. And of course there are the animals which call the seabed home.

"The seabed there is interesting," says Mr Sommerville.

"It's a fairly harsh environment in that they get a lot of storms through there and swells coming through and every storm stirs up the seabed.

"We think the top metre or two gets stirred up and anything living on or in the seabed therefore has to be pretty good at re-establishing itself after every storm. We think all the critters there are reasonably flexible on how they manage sand.

"We have undertaken studies to show that the sands returned will support the same communities. We haven't got the final results from that yet but we are looking forward to that being the case."

Kevin Moratti is not so confident. Taranaki's man on the New Zealand Recreational Fishing Council, he says the sands to be mined are snapper and gurnard spawning grounds and the plumes of sediment that mining will almost certainly create could smother reefs teeming with blue cod.

"I've got a lot of questions, but I am not getting emotive about it. They will end up doing exactly what they want. At the end of the day they will get their seabed mining.

"It's just a matter of how much pressure we can put on them to make sure it's done right," he says.

If done right, TTR estimates their operation will generate $500m a year for the five million tonnes of ore it initially plans to mine. Of this they expect, but don't know for sure, that $400m will stay in New Zealand through royalties, taxes, salaries and services purchased.

Mr Sommerville believes that despite the operation being entirely offshore to avoid expensive infrastructure development, it could directly generate around 700 jobs for New Zealanders.

To Raglan man Tim Rainger, of Kiwis Against Seabed Mining, 700 is just one of the numbers around seabed mining he takes issue with.

The country could reap greater benefit for far less environmental cost if they developed the sands themselves, he says, pointing to the relatively small Glenbrook steel mill south of Auckland as an example.

Using ore from the land-based Waikato North Head, which mines 1.2 million tonnes of sand annually, the mill employs 1200 people and produces around 650,000 tonnes of steel, 60 per cent of which is exported.

"Here we are, we create an industry, a valuable technology. We then turn around and export that technology and raw material so another country can capitalise on our experience, our resource. I just don't get it," Mr Rainger says.

Greater than his economic concerns are those around the environment. Ultimately he does not want mining at all, his opposition coming as an epiphany when he first heard of the proposals nearly a decade ago.

To that end he says Kasm has established "a very good legal team" and a "highly credible group of scientists" to back up their case and scrutinise others, should TTR's bid end up in court.

Even if this proposal, like so many others, fails to materialise this time, Mr Rainger is preparing for the long game.

"We are assuming it's imminent - get ready," he says. "If that takes two years, if that takes five years, the issue is still there. The pressure on the resource is still there. As long as people are still making things out of steel this will never finish."

- Taranaki Daily News

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