Resource exploration around the Southern Ocean continues to
gain impetus, with listed company Chatham Rock Phosphate
gaining its long-awaited mining permit, a ''milestone''
towards extracting sea-floor phosphate from the Chatham Rise
Chatham's 20-year permit, the first granted under the amended
Crown Minerals Act which came into force on May 25, has some
way to go as it now requires a separate marine consent permit
from the Environmental Protection Authority, for which
Chatham will apply early next year.
Earlier this month, Shell confirmed multimillion-dollar oil
and gas exploration seismic surveys will go ahead in the
Great South Basin, south of Dunedin, and Government
permitting agency New Zealand Petroleum and Minerals (NZP and
M) announced the successful bidders in its 2013 block offer.
They include newcomer Woodside Energy Holdings teaming up
with New Zealand Oil and Gas with a permit in the Great South
Basin and Canterbury Basin area, and New Zealand Oil and Gas
gaining its own permit in the same area.
The five onshore and five offshore permits allocated by NZP
and M represent a commitment to spend more than $60 million
on initial exploration, largely on seaborne seismic testing.
Last Monday, Shell New Zealand said Malaysian-based partner
PTTEP New Zealand Ltd had withdrawn its 18% share from the
Great South Basin venture.
However, remaining joint venture parties Shell, OMV New
Zealand Ltd and Mitsui E and P Australia Pty Ltd were
continuing the venture and were ''working through various
options for how the partnership will be structured into the
future'', Shell's New Zealand chairman, Rob Jager said in a
Shell must decide by January 10 on whether to ''drill or
drop'' the permit for that area, which is north of the Great
South Basin area it plans to explore with the separate
''We remain dedicated to the venture and optimistic about the
natural gas prospects in the Great South Basin. The decision
to drill an exploration well and the timing of that drilling
programme is still being considered by the joint venture
parties,'' he said.
Chatham managing director Chris Castle said the mining permit
approval to extract rock phosphate from the seabed in the
exclusive economic zone (EEZ) was ''a significant milestone
for New Zealand as well as the company and the industry''.
''This is our most important milestone to date,'' Mr Castle
''It means we're halfway to being permitted, so the permit
significantly de-risks the company.''
While Chatham had financed exploration, reports and permit
applications to date, the actual suction-dredge mining of 1.5
million tonnes annually will be done by major 18.7%
shareholder Boskalis and Chatham will become the shore-based
phosphate marketing arm.
Chatham has spent more than $20 million to date, booking a
$675,000 annual loss last month, while pushing out the mining
start date to mid-2016, largely because of permitting delays.
Mr Castle said Chatham had applied to extract the phosphate
under previous legislation last year, then application was
transferred to the new regime, designed to operate in
conjunction with EEZ legislation, which applied from June.
''Chatham Rock Phosphate has used the time while the
...application was [being] considered to significantly
improve its marine consent application.''
Mr Castle said Chatham had also had sections of its
Environmental Impact Assessment peer-reviewed by overseas
experts, who suggested improvements, and he was confident of
addressing concerns and could ''demonstrate the environmental
impacts of our operations will be minor and localised''.
''We've also thought carefully about mitigation and
monitoring and are continuing to talk to anyone with an
interest in the project,'' he said.
NZP and M national manager of minerals Sefton Darby said
granting the permit was the first stage of the regulatory
process and Chatham needed a marine consent from the
Environmental Protection Authority, which manages the
environmental impact of activities in the EEZ and continental
• In mid-November, the Government opened its 2014
block tendering round, covering nine onshore and offshore
areas, of which the Great South Basin and Canterbury Basin
are the largest, covering 154,293sq km. Permits will be
awarded in December 2014. A short consultation period was
widely criticised by environmentalists.