Southland support for lignite projects

Southland support for lignite projects

Eastern Southland residents are positive about future lignite mining in their area. The majority cited jobs for the region as the reason for their support, but they also say developments must be carried out responsibly to avoid air and water pollution, and damage to the environment.

A survey of 835 people across Southland and West Otago was carried out in June by Venture Southland, on behalf of Solid Energy and Ravensdown as a part of their work to consider the likely impact of proposed lignite development plans around Gore/Mataura. The survey found that 70% agreed that the lignite should be mined and used, compared to 9% who disagreed. People living in Eastern Southland around Gore and Mataura were more supportive than those in the wider Southland/Western Otago region.

Almost two-thirds (530 people) said the biggest benefit from future mining of lignite would be increased job prospects, while others thought an increase in population (43), improved economy (38), cheaper fuel (31), more warmth/heating (30) and using local resources (22) were the biggest benefits. Major issues identified were possible pollution of air/water (232 people) and environmental damage (222), while other issues were the need to repair environmental damage (56), possible protest action (34), damage to roads (29), noise (27) and possible health issues – mainly respiratory (22).

Other key findings of the survey include:
• 68% would support using lignite in industry, 10% were opposed, with the balance undecided. The main reason for support (152) was “that it was there and should be used” followed by those who believed it improved the economy and created more jobs. The 10% opposed said pollution (44) and environmental damage (32) were their main reasons for opposition.
• 48% would support making urea from lignite, 11% were negative, and 30% unsure. Supporters said fertiliser was needed to help farming (75), it would reduce the need for imports (52) and it was a natural resource and should be used (51). Those opposed thought there were better alternatives to making urea (24), that urea had damaging effects (17) and the risk of environmental damage (17).
• 61% would support making transport fuel from lignite and 9% were negative. Those in support saw the benefits as cheaper fuel (24), leading to fewer imports (20) and would improve the economy (17). Those against cited pollution (8) or thought there were better alternatives (6).
• Overall, people living in Gore/Mataura are more supportive of mining and using Southland lignites than those living in Invercargill and Bluff.
• While more than half thought that property values would be affected by mining, 88% said it would not affect their desire to live in Southland.

Solid Energy and Ravensdown have also investigated the likely cost benefit to New Zealand of their proposed coal-to-fertiliser project which found that technology could unlock the previously unused/under-utilised resource to make New Zealand fundamentally wealthier. New Zealand GDP would be up to $377 million greater annually, based on today’s world urea price of around US$265 per tonne.

The benefits of the project would move in line with the world price of urea – at higher prices the value of the urea production is higher, and benefits to New Zealand are greater. For example, assuming a plant with a capacity of 1.2 million tonnes urea per annum, world urea prices of US$425 per tonne would increase New Zealand GDP by up to $599 million annually and increase employment by up to 2,344 full-time equivalent (FTE) positions.

The two companies’ investigations to date have also concluded that further work is needed to inform the decision on the best lignite conversion technology to use. The technology selection is one of the key drivers in deciding the size and cost of the plant. Completing this work will delay the final decision on whether to commence the next stage of the project – the feasibility study – by 6 to 12 months.

Solid Energy’s General Manager of New Energy, Brett Gamble says, “We were very pleased to find that the survey confirmed what we already thought – that most people in Eastern Southland support our lignite developments, but want us to ensure that air, water and environment are protected. Minimising environmental effects and taking full responsibility for greenhouse gas emissions will be key considerations in all our lignite developments. We’re already investigating carbon capture and storage, biosequestration and biofeedstock options to help reduce the greenhouse gas emissions.”

Richard Christie, Ravensdown General Manager Strategic Development, says, “Solid Energy and Ravensdown remain enthusiastic about the opportunity to bring new and innovative coal to fertiliser technologies to New Zealand, unlocking the value of the world-class lignite resources in Eastern Southland, creating a high value fertiliser to replace imports and providing export potential.”

ENDS

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