Material being stock-piled near the Santana Bendigo Ophir gold project. PHOTO: STEPHEN JAQUIERY Scorn was yesterday poured on the amount of money suggested would go into the government’s coffers by the proposed Santana Minerals gold mine. The proposal is going through the fast-track process with a series of one-day hearings in Wellington on different topics. Economics was the focus yesterday in front of a six-person panel, chaired by Matthew Muir. Economist Benje Patterson, appearing for the applicant, said the project was set to contribute $651 million in revenue for the government in the lifetime of the project. Many commentators questioned tax payments made by mining companies, but that was his calculation, he said. OceanaGold was looking at paying $250m in tax last year. He acknowledged some years OceanaGold did not pay any tax. Economist Geoffrey Bertram, appearing for Sustainable Tarras, said Mr Patterson’s assumption was that mining companies paid tax. He had checked records which showed from 2004-25 OceanaGold paid tax in only five of those years. He said there could be unforeseeable developments with mines, which might limit their tax bill. There were various fees and other charges which lessened the tax paid by mining companies. Economist Edward Miller, also appearing for Sustainable Tarras, said rehabilitation of the mine was important when considering tax. The company would use rehabilitation for tax deductions and they could come back to have a zero income when tax was not paid. Things such as related part loans and transfer pricing could be used to reduce tax bills. The gold price was also debated yesterday, Mr Patterson having set three prices for the proposed mine costings. Gold was sitting at $US4345 ($NZ7472) an ounce yesterday. The three prices Mr Patterson had selected were $US4700, $US3000 and $US2220. Mr Patterson acknowledged the range was very wide, but it was hard to predict with gold and futures only went out to 2029. The life of the mine was 10 to 14 years. He said 12 financial institutions had undertaken a survey on the future price of gold, which helped with his findings. Dr Kirdan Lees, appearing for the Otago Regional Council, said the impacts of Covid, tariffs and the Middle East conflict had led to many central banks buying gold as a safe haven which was keeping the price up. He could see that continuing as banks got out of US treasury bonds. Economist Richard Meade, also appearing for Sustainable Tarras, said Mr Patterson’s prices were too high. It was ‘‘utterly implausible’’ the price of gold would stay this high, he said. Mr Patterson’s price of $US2220 was just above what he thought the highest price of gold would be, going on history. Dr Meade said public policy would get on top of things such as inflation, which would lessen the demand for gold and bring down the price. Griffith University tourism professor James Higham said the mine would have an impact on the region, nationally and internationally. New Zealand had put a lot of faith in its 100% Pure campaign and a large gold mine in Central Otago did not sit well within that campaign. The Central Otago landscape was unique and valued across the country, Prof Higham said. However, Mr Paterson said there were five million tourists coming to the inland Otago area, and just 5% of those went to Central Otago, the bulk of them staying in Queenstown. ‘‘Of that there are about 17,500 potential visitor days in Bendigo. So of the five million, most of them will not be going to Bendigo. ‘‘Bendigo makes up 0.3% of visitor nights to the region,’’ he said.
