Australian mining company Santana Minerals has secured a key permit for a vast gold mine near Cromwell in Central Otago.
New Zealand Petroleum & Minerals, part of the Ministry of Business, Innovation & Employment, has granted a 30-year mining permit that gives Santana Minerals full legal rights to extract gold for its Bendigo-Ophir Gold Project.
Santana Minerals said the permit was one of the two key approvals needed to start work on the mine.
The company, through its New Zealand subsidiary Matakanui Gold, also formally lodged a fast-track application for environmental and development consents this week.
Some Central Otago locals are fiercely opposed to the mine, arguing it is an unsuitable project for fast-tracking and could harm existing industries and the environment.
In a social media post last month, actor Sam Neill – who lives on a Central Otago farm – called the project “toxic”, saying it would cause an environmental catastrophe in a region that was thriving.
Santana chief executive Damien Spring said the mining permit was a landmark achievement for the company and a vote of confidence in the quality and integrity of the project.
“It’s the direct result of years of geological and technical work carried out under the Crown Minerals Act framework. Coming in the same week that we lodged our FTA consent application, this milestone demonstrates the project’s regional and national significance,” he said in a statement.
The permit also set out the royalty Matakanui Gold must pay the Crown – either 10% of profits or 2% of gold sales, depending on which was higher.
Santana Minerals said that would average $32 million per year.
In a statement, Resources Minister Shane Jones congratulated Santana and said he was delighted the company had submitted a fast-track application.
“It’s projects like Bendigo-Ophir that demonstrate the untapped potential of our minerals estate, even in areas thought to be exhausted by historical mining,” he said.
Jones said the mine would deliver well-paid employment, infrastructure investment, and economic resilience in Central Otago.
The company expected the mine to directly employ 357 people, with an average salary of $140,300, but there were national benefits too, Jones said.
“Every New Zealander is set to gain from this development as the Crown collects hundreds of millions of dollars in projected royalties in the first 14 years of operation. The company forecasts it will pay an additional $800 million in taxes. That will go towards meeting our future healthcare, education and infrastructure needs,” he said.
Santana said the mining permit covered both the main Rise & Shine deposit and other adjacent deposits, allowing the company to move “seamlessly from permitting into construction” once it secured fast-track consent.
If approved, the project would carve out a 1000 x 850-metre open pit, plus three smaller satellite pits and a tailings dam.
Advocacy group Sustainable Tarras had raised concerns about the extensive use and storage of large quantities of cyanide upstream of the Clutha River and 13 million tonnes of tailings.
Deputy chair Rob van der Mark said the fast-track process was being used to bypass concerned locals without giving them enough time to review the application.
The Environmental Defence Society challenged Santana Minerals’ projected economic benefits, saying the company needed to provide more detail about what the mine might cost the community, rather than what it would contribute.
It said Santana Minerals should offer a large cash bond to protect nearby communities if anything went wrong.
By Katie Todd for rnz.co.nz
