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In October, Dunedin Mayor Dave Cull wrote a letter of support for Australian company Plaman Resources' application to the Overseas Investment Office to buy a property next to its diatomite mine at Foulden Hill, near Middlemarch.
The letter was provided in the context of supporting economic development in Otago, Mr Cull said.
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Following the publication of a leaked Goldman Sachs report in the Otago Daily Times, Mr Cull has asked the company to urgently clarify the information contained in the report.
He also asked for a copy of the report.
Information about the quality of the diatomite and the continuing access to the site for scientists needed to be addressed, he said.
''We are concerned the report appears to be at odds with the assurances they gave us and if it turns out those aren't as robust as we thought, we will need to reconsider our support.''
Mr Cull said he was also concerned about comments in the report about the local opposition being too poorly resourced to fight the proposal.
Dunedin City Council chief executive Sue Bidrose co-signed another support letter written by Clutha District Council chief executive Steve Hill in November.
There was an agreement between councils to support each other for work which fitted within the Otago regional economic development strategy, Dr Bidrose said.
Plaman needed to address the issues Mr Cull raised if the council's support was to continue, she said.
A $36million plant could be built near Milton, to process the mineral, if the application was successful and the mine went ahead.
Clutha Mayor Bryan Cadogan said it was immensely frustrating only one side of the argument was being made public, but at this stage many of the details were still commercially sensitive.
''I think the full story has its rightful place, but that is when it goes through the consenting process.''
Mr Cadogan has met Plaman representatives but said it would be inappropriate for him to discuss what those meetings were about at this stage.
Otago Regional Council regulatory general manager Peter Winder said regional council chief executive Sarah Gardener had met the company's consultant twice to understand the proposal.
Staff from the consents team, including the consents manager, had also attended pre-application meetings with Plaman, which was standard procedure, particularly for large and complex applications, he said.