Doubts cast on viability of big mine proposal

Press, 7 March 1984, Page 1

Doubts cast on viability of big mine proposal

PA Wellington A big new opencast coal mine at Ohinewai, near Huntly, is likely to produce coal in 1988 for the principal use of the New Zealand Steel mill at Glenbrook.

The Minister of Energy, Mr Birch, released a prefeasibility study yesterday which confirmed the viability of a big opencast mine development at Ohinewai. But the Coalition for Open Government says the proposed mine will be uneconomic and environmentally damaging. It was “an astonishing feat of wishful thinking” for Mr Birch to assert that the mine would be viable, said the coalition. The estimated costs of mining at Ohinewai had almost doubled in the last

year, the group said. “The consultant’s preliminary report is the first over-all assessment of Ohinewai since the 1982 Energy Plan sqid that mining at Ohinewai could be ‘uneconomic and unacceptable for environmental reasons’,” the group said. “We now find that the Energy Plan’s reservations about mining at Ohinewai are well founded. The consultants’ report does not provide reasons for forging on regardless.” The coalition said that the Ohinewai plans should be shelved until it could be publicly proved that the mine would be economical, acceptable to the local community, and not damage the fragile wetland of the area. It said the Government had made a commitment to

supply coal to New Zealand Steel, for political reasons, just before the last election. “Those commitments are not a licence to impose uneconomic or environmentally damaging mines on Waikato communities, or the New Zealand taxpayer.” Mr Birch said that the mine would provide about 430 new full-time jobs during its expected 20-year life. No new town Would be created for the project, but about 300 new houses would probably be built in the area. Mr Birch said the coal

was needed for the Glenbrook steel mill and if development kept to the proposed schedule, coal should begin to be mined about mid-1988 to meet New Zea-, land Steel’s requirements. The proposed schedule was “tight but realistic,” he said. / Several options had been studied in Waikato, and Ohinewai had proved “the only viable source of coal for New Zealand Steel,” said Mr Birch. He said preliminary studies indicated the cost of the coal would be about $69 a tonne, although he emphasised that this was a tentative figure. The cost to New Zealand Steel of importing coal from Australia would be about $lOO a tonne, and this did not include the costs of

providing port handling facilities. Mr Birch yesterday morning met farmers, landowners, and others who would be affected by the new mine. A public meeting will be held in Huntly next month to outline the proposals. Much of the land needed initially for the mine had already been bought by State Coalmines, Mr Birch said. “Settlements have all been on a ‘willing seller, willing buyer’ basis,” he said.

Asked if the National Development Act would be used if it appeared the project was falling behind schedule, Mr Birch said, “It may be that the National Development Act may be the best comprehensive approach to planning.” He said he was confident the Ohinewai project could proceed without damaging any wildlife in the area. There would be no encroachment “to any significant degree.” Once mining had been completed in the various areas of the mine, the land could be restored for farming and forestry, or the area could be given over to recreational uses. A large lake would be formed when mining was completed and this could be suitable for recreation.