Export of coal from Mt Davy agreed to

Press, Volume CXV, Issue 33869, 14 June 1975, Page 1

Export of coal from Mt Davy agreed to

(New Zealand Press Association)

WELLINGTON, June 13.

The Government had agreed in principle to the mining and export of Mount Davy coal, the Prime Minister (Mr Rowling) told a public meeting at Westport this evening.

The approval was subject to important terms and conditions, he said, including the selling price, royalties to be paid, environmental requirements. and other considerations.

These conditions would he conveyed to the company concerned, West Coast Resources Ltd, in the next few days.

The Minister of Mines (Mr Colman) and the Minister of Energy Resources (Mr Freer) had also been authorised to negotiate final terms with the company. "The coal is a type of coking coal, and its export has only been sanctioned after careful consideration of its possible use in New Zealand.” Mr Rowling said.

A number of options .tad been investigated, and the final conclusion favoured the export scheme, he said. There was a strong demand for that type of coal on the world market, but. more important, there were several benefits which New Zealand could not overlook. ’Huge resources’ “Using this coal for electricity generation would be a waste of its valuable properties,” Mr Rowling said. “After all, there are large resources of coal for generation purposes available on the Coast—indeed the country generally has huge proven resources of coal to draw on.”

The Mount Davy field offered the company 71m tons of coal over a 15-year period out of proven recoverable coal deposits of more than 800 m tons in New; Zealand.

Extracting the Mour Davy coal was hardly likely, therefore, to upset the balance of resources available to New Zealand.

Mr Rowling said that Mount Davy coal was also not “energy coal,” and there was no point in wasting it to produce electricity when there were thousands of tons available which were better suited for that purpose. Another factor involved was that the very issue of a prospecting and mining licence to West Coast Resources, Ltd. carried with it the obligation that if the company proved the field, and the type of coal it wanted was there for the mining, it had the

right to mine and export that coal. “It has found the coal it wants and proved the size of the resource. I think that, with the present demand, to leave the coal in the ground would ignore the realities of the situation,” Mr Rowling said. “It see.as to me, therefore, that there is no substantial reason for not going ahead, subject to the terms, conditions, and controls the Government will ensure are met.” he said. The Government would look sympathetically at. the idea of putting some of the returns from the export of the coal into a regionaldevelopment fund for the West Coast.

I Three sites were under i consideration by the Electricity Department for a i major coal-fired power station in the Buller area.

The station was programmed to start producing in eight years I time.

"A site-assessment report on these three areas is expected to be completed in July or August, and a full environmental impact report should be produced within a year,” Mr Rowling said. “A final decision about the station will be needed by late 1977, and construction is expected to begin soon after Clutha development “We must have a thermal plant in the South Island to complement the Clutha development,” said Mr Rowling. “The coal of the Buller will be used for this, and the workers of the region will help to provide the mani power, particularly at the mine site and during construction.” Another 250 people would

be involved in running the station, while the mining people extracting the coal would be extra.