Tough year for NZ mining

Manager Mark Coleman and L&M Group's Earnscleugh alluvial gold dredge, which ceases operation in...
Manager Mark Coleman and L&M Group's Earnscleugh alluvial gold dredge, which ceases operation in a month. Photo by Lynda van Kempen.
Belt-tightening in tough times could be the unofficial theme at New Zealand's 2014 mining conference, which begins on Monday.

The three-day Hamilton conference will have a sobering backdrop of depressed gold and coal prices, a South Island gold mine closure this week and labour retrenchment involving several hundred employees throughout the sector during the past year.

Hosted by the New Zealand branch of the Australian Institute of Mining & Metallurgy (AusIMM), the conference has attracted about 250 delegates.

There have been few wins to rejoice in during the past year, with Bathurst Resources having to postpone ramping up its coal exports because of depressed prices, Oceana Gold reducing mine life at Macraes in Otago and Reefton on the West Coast and laying off staff.

Solid Energy has also cut its workforce.

The diverse and long-running L&M Group shocked the sector this week when it announced it is closing its Earnscleugh alluvial gold dredging project near Alexandra, the largest alluvial operation in the country.

With ever increasing production costs, the high New Zealand dollar and low global commodity prices are taking a heavy toll.

The two factors ultimately wipe tens of millions of dollars of work and value from local economies.

There should at least be some positive progress reports, from Newmont's Waihi Gold, which is updating its new underground Correnso development, and MOD Resources progress at Sam's Creek, an expanding gold exploration target northwest of Nelson.

University of Otago students and senior staff appear to be set for one of their strongest showings at a conference in recent years and 12 of the 18 student presentations are linked to Otago.

The National-led Government's ambition to have the mining sector and the separate oil and gas sector underpin economic recovery has borne little long-term gain and Energy and Resources Minister Simon Bridges is likely to be pushed for answers at the Hamilton conference.

Updates are scheduled to be delivered by Oceana Gold, Solid Energy, L&M Group and Bathurst, all of whom to varying degrees have had to move fast to survive amid the volatile climate at present.

On the regulatory front, the Department of Conservation, permitting agency New Zealand Petroleum & Minerals and political lobby group Straterra are all involved in a variety of topical presentations.

Simon Hartley will be hosted at the conference by AusIMM.

Add a Comment