MEDIA BACKGROUNDER - March 2004

Underming Conservation - Proposed Pike Coal Mine
By Royal Forest and Bird Protection Society

The Australian based Pike River Coal Company (PRCC) (72% owned by NZ Oil and Gas Ltd and 28 % private investors) wants to develop New Zealand's second largest export coal mine in the headwaters of the Pike River on the eastern slopes and crest of the Paparoa Range. The area has spectacular conservation and landscape values.

The company wants to mine around 10 million tonnes of coal (between 650,000 and one million tonnes annually) from underneath conservation land outside and on the fringes of Paparoa National Park, and in around five years mine directly under the park. PRCC wants to mine for at least 20-25 years, and potentially until 2037, mining 24 hours a day, 7 days per week.

Conservation Minister, Chris Carter is expected to decide shortly on PRCC's application to access conservation land. A "NO" decision by the Minister would stop the mine and protect the outstanding conservation values of the area.

The mine would require bulldozing a 12 km access road across conservation land up Pike Stream to the mine entrance in White Knight Stream, and a 2.2 km underground access tunnel from there. Coal would be carried by water (abstracted from Pike Stream) in a flume out of the mine and down valley to a coal dewatering plant (on private land) where the water would be removed. PRCC wants to truck the coal from there to a rail siding at Ikamatua or by using super large trucks (not currently permitted on New Zealand roads) to Greymouth.

The company received initial resource consents from West Coast councils in 1999. The Department of Conservation (DoC) appealed those decisions to the Environment Court, based on inadequate information about the proposal and its impacts. Major changes to the proposal (including changing the road route and location of the mine entrance) saw the company reapply for a suite of new consents in 2002. West Coast councils granted these in May 2003. PRCC has appealed the consent conditions. Neither the 1999 or 2003 appeals have been heard, because the Minister of Conservation has yet to decide on PRCC's application to access conservation land for mining. Changes to the application and PRCC's delays in providing significant information have extended DoC's decision making process.

Major issues of concern include:

Habitat destruction

* The mine would require a 12 km access road through the Saxon Ecological Area and up the unroaded Pike valley through pristine beech and rimu forest, and forest which has regenerated strongly after selective logging in the 1970s. The mine site is habitat to at least seven threatened species, including great spotted kiwi, kaka, kereru, western weka, yellow crowned kakariki and whio/blue duck, and a native fish koaro. DoC's Conservancy Mining Report (Dec. 2003) describes the upper Pike Stream catchment as having "high flora and remote experience values" (p 13, para 37). For much of its length the road will be within 100 metres of Pike Stream with a risk of spoil and debris falling into the river. The 20 metre wide road and pipeline corridor and the construction of 5 large bridges, the waste rock dump, mine facilities area and mine entrance will destroy the area's wild and scenic character. Given the steep country there is a risk of the road formation collapsing.

* The endangered blue duck/whio has been recorded in Pike Stream and Big River. The mine access road, removal of streamside vegetation, reduced flows, and water pollution would make the rivers unsuitable as blue duck habitat.

* More than 85,000 cubic metres of waste rock would be dumped in the mine buildings area, on the road route and at the dewatering plant making any revegetation post mining difficult.

* Subsidence and landslips

* Risk of subsidence and landslips over more than 200 ha of conservation land in the upper Pike catchment and on the plateau at the crest of the Paparoa Range. Ground subsidence of at least 3 metres in places, and surface cracking is predicted including within Paparoa National Park. DoC estimates that if widespread vegetation dieback occurred as a result of subsidence that it would up to 400 year for similar vegetation to develop (p 26, para 113, p 44 para 193). Current stunted beech and yellow silver pine is estimated at 300-400 years old. Severe subsidence and slumping has occurred at the Strongman Mine on the Paparoa Range to the south-west. Two landslips in 1998 and 2002 dumped more than 60,000 cubic metres of material in Ten Mile Creek and created a 400 metre lake. Mining there also occurred under steep slopes and escarpments.

* Vegetation on coal measures is distinctive because of the low fertility and difficult growing conditions. Very little coal measure vegetation is protected as conservation land. The coal plateau on the crest of the Paparoa Range has high ecological values and DoC describes it as "noteworthy" because it is relatively intact, has not been burnt, has no weeds and no obvious human modification compared to other coal measure areas on the West Coast.

* Risk of surface cracking when the rock above the coal seam collapses into the void created by extracting coal. This and air access increases the risk of fire from spontaneous combustion of coal in the shallow parts of the mine. It has been impossible to extinguish such fires in some other coal mines.

* DoC's Conservancy Mining Report (19.12.2003) report notes that subsidence can have the following impacts:

- increased potential for soil instability and erosion with increased surface erosion during rainfall;

- mass movement of soil and rock (increasing the likelihood of landslides)

- if subsidence causes major vegetation dieback the recovery would be very slow because of environmental conditions (p 33, para 139).

* Damage to a dramatic west-facing escarpment on the crest of the Paparoa Range which is the boundary between conservation land and Paparoa National Park. The company wants to drill four tunnels for emergency exits through the escarpment. Underground mining close to the escarpment also risks slumping and damage to it.

* Noise and destruction of wildness

* Increased helicopter activity on the crest of the Paparoa Range. The area is currently weed free with a high degree of naturalness and integrity. Regular landings, transport of people and equipment risk weed introduction, destruction of natural quiet, and loss of remoteness.

* A major industrial operation such as the mine with its noise, road, blasting and environmental damage would effectively make the Pike valley unattractive to trampers, fishers, and other recreational users who can currently enjoy a remote and wild experience in an accessible valley.

Water use and pollution

* Hydraulic mining, where coal is dislodged from the seam in slices by a high pressure water jet and then flumed out of the mine and down the valley to a dewatering plant and loadout point, requires large volumes of water. These abstractions will reduce the flows in Pike Stream by at least a third in summer.

* Water quality in Pike Stream is very high because of the largely intact nature of the catchment. The mine risks severe water pollution from acid mine drainage (AMD). The mine will produce an estimated 30-116 litres/sec of water affected by AMD during the life of the mine and 19 litres/second after it closes. Acid mine drainage is defined as mine-water run-off with high concentrations of acidity, iron, manganese aluminium and suspended solids which are toxic to aquatic life. It results from geochemical and microbial reactions when water comes in contact with sulphide bearing minerals (such as pyrite) in the coal measure mudstones, or waste rock or coal. The Brunner coals at Pike River have moderate to high sulphur contents in the rocks in the proposed mine roof and floor. These have the potential to develop acid mine leachates.

* Discharges from the coal dewatering plant (including treated AMD water) would pollute Big River, a tributary of Pike Stream.

General

* The inadequacy of proposed mitigation. As part of this $65 million project the company proposed in 2003 to spend around $40,000 annually on limited stoat control in a narrow strip up Pike Stream (plus around $70,000 as part of the access agreement PRCC seeks from DoC) on blue duck somewhere else. DoC has declined to release any updated mitigation package.

* The very limited environmental investigation undertaken by the company and the major shortcomings in understanding of the mine's potential impacts and measures to address them. eg in a March 2003 newspaper supplement PRCC representatives denied that acid mine drainage would occur. DoC's independent experts say otherwise. DoC's Dec 2003 Conservancy Mining report highlights a number of areas where information gaps exist.

* The "mine and let's see what happens" approach being adopted by the company. PRCC's proposes to leave much of the mine design work till after "trial mining" has begun. West Coast councils accepted this approach. This means the full scope of the mine's impacts was not scrutinised as part of the consent process.

Relevant extract from Department of Conservation Conservancy Mining Report at pp 88-90:

APPENDIX AA 19 December 2003 CONSERVANCY MINING REPORT

Access Arrangement Application Mining Permit 41.453

For: Mining and Mining Operations

Location: Pike Stream Catchment, Eastern Paparoa Ranges

Applicant: Pike River Coal Company Ltd.

Conclusions ( From p 88-90)

4 In making a decision on the application the Minister of Conservation must have regard to the criteria set out in section 61(2) of the Crown Minerals Act (CMA). Section 61(2) CMA states:

"In considering whether to agree to an access arrangement in respect of Crown land, the appropriate Minister shall have regard to:

(a) The objectives of any Act under which the land is administered; and

(b) Any purpose for which the land is held by the Crown; and

(c) Any policy statement or management plan of the Crown in relation to the land; and

(d) The safeguards against any potential adverse effects of carrying out the proposed programme of work; and

(e) Such other matters as the appropriate Minister considers relevant."

How the Minister takes the criteria into account and what weight he gives to them are matters for him to determine.

4 In summary, the Department's conclusions are:

PRCC's application is inconsistent with the matters covered by section 61(2)(a), (b), and (c) CMA, being the objectives of both the National Parks Act and Conservation Act, the purpose for which the land is held by the Crown, and the current management plans for the land for the following reasons:

Objectives of the National Parks Act

* The anticipated and potential adverse effects of the proposed mining operations are inconsistent with the objectives of the National Parks Act 1980.

* Objectives of the Conservation Act

* The anticipated and potential adverse effects of the proposed mining operations are inconsistent with the objectives of the Conservation Act 1987.

* Purposes for which the land is held

* The anticipated and potential adverse effects of the proposed mining operations are inconsistent in general terms with the purposes for which the land is held by the Crown; that is National Park, deemed stewardship area, deemed ecological area and marginal strip.

* Management Plans

* Although neither plan specifically exclude mining:

* The anticipated and potential adverse effects of the proposed mining operations are inconsistent with the Remote Experience Zoning under the North Westland Regional Management Plan;

*

* The anticipated and potential adverse effects of the proposed mining operations are partially inconsistent with the Paparoa National Park Management Plan;

The above two plans are the current management plans of the Crown in relation to the land.

Safeguards (including financial assurances) against potential adverse effects

In terms of section 61(2)(d) CMA which covers the safeguards against any potential adverse effects of carrying out the proposed programme of work, the Department is particularly concerned about losses to the following natural resources of the Pike Stream site:

* a relatively intact catchment in terms of flora;

* the remote experience for recreation;

* the relative lack of modification of the upper Pike Stream catchment area being stewardship area/RE Zone;

* water of very high quality including high quality aquatic habitat;

* habitat for 10 threatened native species including 7 bird species such as kiwi, kaka, kakariki and blue duck;

* the current wildlife habitat;

* the values of the National Park/RE Zone, especially the dramatic island sandstone escarpment.

The significant adverse effects as a result of this mine proposal which PRCC propose to partially safeguard against are:

* potential subsidence which would adversely affect surface values in the stewardship area/RE Zone and the fringes of the National Park/RE Zone;

* potential acid mine drainage from coal seams, surrounding rock or excavated material following mine closure, including problems associated with ongoing management of adverse leachates and groundwater discharges during mining;

* impacts of the proposed access/road route by way of pest control and rehabilitation.

In addition to the above, the Department holds serious concerns in relation to the potential long-term adverse effects which could occur after the completion of mining operations and whether the Department can protect against significant losses: For example:

* AMD water quality issues or design faults in the mine water discharge point at the stone drive seal after mining operations are complete;

* The permanent adverse effects as a result of subsidence;

* Full rehabilitation of natural resources, if successful, would take several decades to hundreds of years to reinstate the values that are currently onsite. Table 1 (summary of this report) indicates why the Department holds serious concerns in relation to the potential long-term adverse effects which could occur after the completion of mining operations.

Other matters

* The Department's view is also that the time that the site is closed to the public and the loss of a relatively intact forest catchment is a matter to consider in respect to any assessment made under section 61(2)(a), (b) & (d) CMA.

* In terms of section 61(2)(e) CMA covering "such other matters as the appropriate Minister considers relevant" the compensation offer proposed by PRCC appears to be generally appropriate and the quantum for proposed impacts ([blanked out]) including the 9 hectares of land offered, appears to be adequate, as long as any compensation payments received are to be inflation adjusted over the life of the mine.

The key issue for the Minister to decide is whether the proposed partial safeguards and the compensation package offered by PRCC, are sufficient to outweigh the Department's concerns about the matters covered by section 61(2)(a), (b) and (c) CMA, that is, the objectives of the Conservation and National Parks Acts, the purposes for which the land is held and the relevant management plans.

ENDS

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