bizEDGE New Zealand logo
Story image

Fonterra's Glencoal says Waikato coal mine not on hold, just delayed

Fonterra Cooperative Group subsidiary Glencoal has denied suggestions it has put its plans for an open cast mine in the Waikato on hold indefinitely following public opposition.

Former Green Party co-leader and environmental activist Jeanette Fitzsimons claimed today that Glencoal had backed off plans for a mine in Mangatangi despite having gained consent from the Waikato District Council and Waikato Regional Council in late 2013, subject to a number of conditions designed to address environmental and health concerns.

In a blog for the Coal Action Network, which is trying to stop coal mining in New Zealand, Fitzsimons said the local community was celebrating after lodging submissions and staging protests against the mine.

However, a Fonterra spokesman said that while it was experiencing some delays in the project due to the need to minimise environmental impacts, it had not been put on hold.

Fitzsimons also said that Solid Energy had just reopened Kopako 1, an old mine that was part of the same Maramarua coal field as the proposed site for Glencoal's one.

Solid Energy has a contract with the dairy cooperative to supply coal for its Waikato milk drying plants.

Solid Energy spokesman Bryn Somerville said the state-owned coal miner was doing some work on whether it will re-open the Maramarua field but no decision had been made.

The company has bigger problems on its mind right now after it announced today it would delay reporting its first-half accounts because forward pricing for coal may impact its ability to meet debt repayments when they fall due next year. Low coal prices are expected to continue for longer than previously forecast and will mean Solid Energy will need make further structural changes.

Somerville said Solid Energy was looking at potential North island replacements for its Rotorwaro open cast mine, its second-largest coal-field, which supplies major North Island customers such as Fonterra, Genesis Energy and NZ Steel. Options include trying to extend the life of the mine which Somerville said could potentially run out of coal in the next three to six years.

Fitzsimons claimed Fonterra was one of the country's largest coal users, which clashed with the "clean, green image" it liked to use to sell its milk overseas.

Fonterra said it was looking at ways to optimise its energy mix and reduce its reliance on fossil fuels but dairy processing was energy intensive.

The new Kopako open cast mine on 30 hectares of farmland near Maramarua is aimed to replace Glencoal's Kopako 3 mine in the same coal-field which is expected to be depleted by around 2017.

Glencoal's planned new mine will extract coal over eight years and once the mining is finished, the land will be returned to pastoral farming.

Submitters raised concerns about respiratory problems for locals from dust, noise and traffic, and adverse effects on waterways downstream from the mine. The commissioners found the health risks raised were overstated and conditions could be put in place to mitigate the dust effects and limit the noise. They were also satisfied there would be no significant adverse effects on the Waikato River.