Huntly and Waihi locals suffer over pits

18:23, Sep 02 2012
IN A HOLE: Huntly East coal mine is set to lose 123 staff later this month.
IN A HOLE: Huntly East coal mine is set to lose 123 staff later this month.

As one Waikato mine lays off staff just to stay open, another is pushing ahead with expansion plans as a way of ensuring its future.

But both decisions are causing fear and uncertainty in the communities in which they are based.

Huntly East coal mine is set to lose 123 staff later this month, and more jobs may go if they cannot get their biggest contract resigned before next year.

Meanwhile, a resource consent application for Newmont Waihi Gold's gold mine, Correnso, which was to be located beneath Waihi East, has now been publicly notified.

The application has made many in Waihi unhappy, with Coromandel-based Green Party List MP Catherine Delahunty saying residents were in danger of having vibrations or cracking if the underground mine proceeded beneath their homes.

But she said many feared that speaking up, and making a submission against the mine, would jeopardise their chances of Newmont buying them out, or offering a "top-up".


"So in a way people are a little bit scared to rock the boat because it's like ‘maybe I won't get my house if I object'.

"It's easy for a big multinational like Newmont to bring in witnesses to say that everything that's happening within that town is not having a negative affect.

"But that is not the story the locals tell."

But Newmont Waihi Gold spokesman Sefton Darby said the Correnso mine, likely to be operational by late 2015, would ensure the 120-odd underground jobs plus dozens of spin-off jobs in the small mining community would continue.

Mr Darby said in the past four or five years, extraction costs had far exceeded gold costs, and this year Newmont would post "a very large loss", but they were pushing on with planned Correnso developments.

"Otherwise there will be no mine here."

Meanwhile, managers on both sides of Huntly East coal mine's biggest contract have been told to "stop playing with people's lives" or more jobs could be at risk.

Engineering, Printing and Manufacturing Union lead organiser Ray Urquhart said the 123 jobs at risk at Huntly East coal mine could be saved if New Zealand Steel's Auckland-based Glenbrook Mill would simply sign a new contract.

Solid Energy, owners of Huntly East, announced last week that by the end of this month they would cut 63 mining jobs and 60 contractor positions.

Last week Solid Energy's chief executive Don Elder was unable to guarantee the future of the remaining 171 staff if the Glenbrook contract, worth upwards of 80 per cent of the mine's output, was not resigned.

The current five-year contract expires next June.

Mr Urquhart said if the contract was allowed to lapse, the steel mill would also be at risk of faltering, as Huntly coal was vital to its operation.

Imported "lower quality" Indonesian coal was currently used in small quantities at Glenbrook, but there was talk of it becoming the primary supply.

Waikato District Mayor Allan Sanson said he was doubtful anything less than a 10-year contract would save the 123 jobs that were on the line.

"It's an economy of scale and time. If Glenbrook was prepared to come to the party with a 10-year contract, then I think Solid Energy would look at continuing their expansion.

"If they only get a five-year contract, I don't think they would bother."

He said the contract signing delay was a bit of price-negotiating "gamesmanship" on Glenbrook's part, as getting Huntly coal would prove the most cost-efficient option.

If they were to switch to Indonesian coal it would probably have to be transported from Tauranga, "three times" the distance of Huntly, and on a trunkline that did not have the capacity to cope with the extra "half a million tonnes" of cargo per year, meaning a huge capital outlay would be needed.

Mr Sanson said if Glenbrook didn't re-sign, it would be "the death of Huntly East".

Waikato Times