Panirau Mine

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Nature and location of the site

Mokau South Resources (MSR) are seeking to establish an opencast, thermal coal mine on a site on the Panirau Plateau (Mining licence no 37089).

The proposed mine is within the area of Mining Licence 37089. The land is owned by the Crown and is administered by the Department of Conservation.

The site is on the Panirau Plateau located in the Mokau River Catchment approximately 15 km north, north-east of Ohura. The area is to the south of, and adjacent to, the main Mokau Coalfield. Size of the site is approximately 300 ha mine area with an additional 10 ha overburden and product stockpile.

Access to the proposed mine is along a private road off the end of Mangakara Road north – east of Ohura. This road, most of which is outside the mine licence area, has existing use rights. The area has a rolling to steep contour with generally regenerating native bush. The mine area slopes at about 6 degrees starting 240m above sea level and rising to 370 m. It is covered with cut over rimu bush and is mostly vegetated with manuka and ponga [tree fern].

Photographs

Locality map

Description of the proposed mine

Panirau is planned to be a strip mine rather than the usual pit mine. This means that compared to a pit mine the non-rehabilitated disturbed area is much smaller relative to production levels. Initially there will be two exposed areas; the mine and a dump for the initial overburden from opening the mine. After sufficient space is available the overburden will be dumped into the northern side of the mine pit and the initial dump of about 3 ha will be rehabilitated by revegetation. The dump in the mine pit will also be progressively rehabilitated. The initial mine when fully developed will be about 8 ha. There will also be two stockpiles of product.

The mine contains up to 50,000 tonnes of coal per hectare, with the initial planned production being 300,000 tonnes per year. With current market conditions the maximum ratio of overburden moved to coal produced would be 10 to 1. Approx 2.5 million cubic metres of overburden will be removed each year, contoured and revegetated by direct revegetation transfer.

As this would be a progressive and moving mining operation, the consents applied for cover the whole of the coal mine licence area with monitoring and reporting requirements that ensure the progression is properly carried out.

Depending on economic conditions, the mine is expected to have a life of a minimum of 15 and a maximum of 50 years. A consent period of 30 years has been requested.

The legal situation

Leasehold title
MSR holds the leasehold title (Taranaki Land Registry No 18714 identifier TNK1/26) to coal resources with rights of renewal after 1 October 2016 for another 126 years. The lease confers the right to mine the coal under an area of coal prospective land exceeding 10,000 ha south of the Mokau River and is maintained with a ‘peppercorn rental’.

A report to MSR by Ashby Consultants (30 April 2007) states that, 'Under land owned by the Crown and administered by the NZ Department of Conservation (DOC), this lease gives rights to MSR that are, for all practical purposes, equivalent to ownership'.

Licence issue and conditions
'Within the MSR Lease, a Coal Mining Licence (CML 37089) was granted on 9 November 1990 over an area of 743 hectares. The CML was issued before the introduction of the Resource Management Act (RMA 1991) and confers the advantages of resource consents now issued under the RMA.'

According to an NBR report, MSR has a licence to mine 7 Mt of coal.

The licence agreement, signed with the Ministry of Commerce, gave Ohura Timber and Coal Products Limited (now Mokua South Resources Ltd) the right of renewal for a further 21 year term from 02 October 2016. After that, MSR has the right to five successive 21 year renewals provided that the company has met the terms and conditions of its Memorandum of Lease L18714 with the Department of Conservation. The licensee is required to forward annual working plans to the local territorial authority, the catchment authority and the Department of Conservation. The licensee has to meet a number of requirements including the one that disturbance of the environment is kept to a minimum and injury or damage to endangered plants and trees, and to endangered wildlife and native bird life is avoided.

A bond of $147,700 was paid.

Other companies holding Mokau Mining Permits
53113.01 Stevenson Mining Ltd, Exploration, Approved 11 Feb 2010
40858.01 Genesis Power Ltd, Exploration, Approved 11 Sep 2006

Relationship with the Department of Conservation
Minutes of meetings of the Taranaki/Whanganui Conservation Board indicate that, since Dec 2012, the Board has attempted to obtain information about proposed mining at the head of the Mokau River. In May 2013 the Board was told that the lease was at a preliminary stage and that there were complexities around lease and access arrangements. The Board requested a presentation of the proposal and the opportunity to raise issues on the potential environmental effects.

The April 2014 meeting was informed that there was no advance in MSR’s application but it was likely to happen in the near future. [MSR’s consent application to the Waikato Regional Council is, however, dated March 2014.] A verbal report from Darryn Ratana was given, but its content isn’t recorded in the minutes. Questions raised about mineral mining activity were raised at the Dec 2014 meeting and about whether permit applications are publicly notified.

There are no apparent reference to MSR’s proposal in 2015. (Minutes are available on-line for the Feb meeting only.)

Permit details
Record 37089
Coal Mining Licence
Tier: 2
Area (hectares): 743
Operation Name: Mokau
Granted Under Act: Coal Mines Act 1979
Duration: 25 years and 11 months
Commencement Date: 09/11/1990
Expiry Date: 01/10/2016
Mining method: Opencast coal
Permit changes: 37089.01 Application for minerals permit 22/02/1985 Approved

Coal Resources

Mokau coal
The Mokau coalfield contains most of the resources in the Taranaki region. Taranaki coals are of sub-bituminous A to B rank, with highly variable sulphur contents. Most seams have low to medium ash contents. The region is well explored by outcrop sampling and drilling. A preliminary mining feasibility study of the Mokau coalfield in 1985 defined 36 Mt of opencast reserves. Coal has been mined on a small scale in the Taranaki Coal Region since the 1880s, with a total production of about 3.7 Mt from several mines in the relatively remote location. There has been no production since the last mine, in the Waitewhena coalfield, closed in 1990.

In 1995 MSR employed D J Phelps & Co Ltd to investigate the opencast coal resources both within its Lease and within the Coal Mining Licence area beneath the Panirau Plateau. The main seam (suitable for underground mining) was found to reach a thickness of 2.38 m. Above the main seam there are a number of thinner seams, with an area of 220 ha, recoverable by opencast mining. A 2006 study calculated an Indicated Coal Resource of 5.421 million tones. The more extensive Phase 2 study in 2007 gave an Indicated Resource of 30.36 million tonnes. The depth of the overburden varies greatly.

Coal quality
Eight seams suitable for opencast mining were studied.

Characteristic	Range of mean values
Ash content	5.75–13.22 %
Moisture content	12.70–13.85 %
Sulphur	1.6–3.23 %
Energy content	22.47–24.84 GJ/t

SCoTA coal quality specifications (globalCOAL) allow a maximum sulphur content of 0.75–1.0%, depending on the country of origin. The Phelps report acknowledges that the sulphur levels are generally considered to be a negative factor but considers that, “the recent improvements in processing of coal, such as coal gasification, enable contaminants such as sulphur to be utilised and sold.” MSR also believed that it would be possible to blend coal with imported product, presumably for use in the domestic market. Some of the $15 million that the company sought to raise in 2009 would be used to clean coal needing to be imported from South Africa.

Financing

In Jan 2009 it was reported that MSR were in talks with Port Taranaki over potential development of a new coal export trade through New Plymouth, particularly to Australia, China and India. MSR director Ian Sampson said, “We've spent a lot of money investigating the coal resource and we're at the stage now where we're ready to go . . . But we need more money to get things up and running we can't raise the money privately." He estimated that $15 million would be needed to create a viable export operation.

MSR also wanted to see its coal used for power generation, especially if the emergency dry-year diesel-fuelled power station at Whirinaki in Hawke's Bay was split up (as suggested in a Government review), and pieces moved to new locations around the country where they could be operated on different fuels. Ian Sampson believed that the Whirinaki generator could be relocated to Taranaki where it could be run on Mokau coal and used as a testbed to establish clean coal technology.

Consenting process

Applications
MSR’s initial application in March 2014 applied for only a discharge and a water permit, stating, “It’s a marginal call whether everything we want to do is permitted.”

The Waikato Regional Council took issue with this point of view in a strongly-worded letter of 09 June 2014 that cited many concerns, including the effect of earth disturbance activities on erosion, the need to confirm a working area for the mine at the consenting phase, misunderstanding of the ‘net take’ of water, and the absence of detailed characterization of the inherent terrestrial and aquatic ecological values. Consequently, MSR submitted a supplementary application in Oct 2014 with applications for four additional consents. This application insisted that, “It is important to recognise that this suite of applications in itself is supplementary to Coal Mine Licence 39089. That licence permits all the land use effects of mining. Damage to the vegetation (i.e. clearance) within the licence area is already permitted and this application is limited to considering the potential adverse effects of that clearance on water, air and soil stability. In that context the flora and fauna values are outside the scope of this application. It is also important to note the previously supplied email from DOC accepting our right to mine under the coal lease.”

Notification
MSR’s application was notified on 15 Dec 2015, with submitters being required to make their submissions to the Waikato Regional Council by 02 Feb 2016.

Environmental impacts of the mine
The Hazel Hewitt report states that the Coal Mine Licence 39089 permits all the land use effects of mining. Damage to the vegetation (i.e. clearance) within the licence area is already permitted and so the application is limited to considering the potential adverse effects of that clearance on water, air and soil stability. It is claimed that, in each case, with the various mitigations proposed, the effects of mining will be minor or less than minor.

It is considered that there are no significant indigenous vegetation or significant habitats of indigenous fauna. As the Wildlands’ ecologists did not visit the proposed mine site (see below), it is unclear upon what evidence this claim is based.

Some proposed mitigation measures

• Resource consents have been applied for (APP132044) to enable the diversion of rivers away from the coal mine so that there will be no activity into or onto the beds of rivers.
• Water required will be obtained from the stored water contained from the diversion. It is claimed that, taking into account the permitted baseline in rule 3.8.4.6, MSR will not be taking any water, hence there will be no effect on other users.
• The area has approx 2.0 m of rain each year. Surface water (i.e. storm water discharge) will be collected into Sediment Retention Ponds which will then discharge into the surrounding terrestrial environment. This would allow for sufficient sediment to settle out of the runoff as it passes over the land prior to its eventual drainage to the Tikoputa and Panirau streams
• It is considered that the potential for acid drainage is very low but the possibility is allowed for. Limestone will be mixed with material when necessary, or alternatively the material will be stockpiled excluding air and water.
• Written design for the upgrading of the road is not normal practice; it is felt that supervision by qualified and experienced personnel will be sufficient. Drainage improvement will improve erosion control and slope stability, without affecting water quality.

Ecological assessment

Wildlands consultants prepared an ecological assessment, focusing on the effects of the sediment discharge system on the Mokau river catchment. A literature review was carried out, plus a one-day field study of the Panirau Stream (02 July 2015) at a time of high water flows, in which a single downstream sample was taken. The location of the proposed mine was not visited.

Vegetation North Taranaki hill country is dominated by tawa, with hinau, rewarewa, northern rata and other broad-leaved species. Going further inland, podocarps, especially rimu, become common. Steeper slopes may be dominated by kamahi, and ridge tops by hard beech. Large areas of shrubland are regenerating after forest clearance. Manuka is usually the dominant species, but quite quickly gives way to forest trees.

Ecological values of the Panirau stream
The report states, “Aquatic values of the Panirau Sream are considered to be very high. It is evident that the stream is unmodified and unaffected by human activities. It contains a good diversity of hydrological conditions (pools, runs, and riffles) and an abundance of stable habitat . . . The stream supports at least five indigenous fish species, including four At Risk species. The stream and its tributaries are entirely buffered by indigenous forest, which in turn will provide important inputs of woody debris and leaf litter to support macroinvertebrate communities. [All but three of the 19 taxa recorded had tolerance scores of five or more, indicating that they wouldn’t tolerate polluted water.]

'Further evidence of the pristine state of the stream is demonstrated by the very low levels of nitrates, heavy metals and E. coli. Turbidity was relatively high, although this may be attributable to the time of year in which the survey was undertaken as well as the sandy-silts that naturally form the stream substrate . . . it is also possible that browsing animals – particularly goats – may also be contributing to increased sediments entering the stream.'

Potential adverse ecological effects of works
MSR has applied for the diversion of storm water outside the mine pit. Wildlands’ ecological assessment acknowledges that treated discharge could reach the headwaters of tributaries that drain into the Panirau Stream. They state that this could be avoided by the judicious installation of the drainage network. Excessive volumes of water may cause localized scour and erosion, especially on steep slopes with waterlogged soils. The report considers that the chance of sediments reaching the Panirau Stream is extremely low, especially as the sediment treatment system will discharge into a well-vegetated environment.

The ecological report points out the need for future monitoring.

Revegetation

Revegetation is planned to be carried out by direct vegetation transfer, which will involve the felling of any large trees. The Department of Conservation’s publication ‘Revegetation of alluvial gold mines: A prescription for the West Coast Tai Poutini’ is appended to MSR’s October 2014 resource consent application, presumably as an indication of how this will be carried out. It is acknowledged that, even with ‘direct transfer’, there is often only enough salvageable plant material to cover at most 50% of the re-contoured ground. A significant problem is the loss of biological activity, especially if the material has been stored. Invasive weeds such as gorse are often a problem and weed control may need to be carried out.

In the case of alluvial gold mining, the Department of Conservation points out that restoring the natural vegetation of a mined area to a dense cover, of even pioneering plant species, requires decades or even tens of decades, and so considers that it is unrealistic to expect a mining company to be committed to long-term post-mining site maintenance. Presumably this will also be the case if Mokau Southern Resources is allowed to proceed with coal mining on the Panirau Plateau.

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