Gold mining leaves Waihi deprived

Despite Gerry Brownlee’s absurd aspiration to be Australia and to mine our treasured places the economic arguments do not stack in the one Coromandel gold mining town, Waihï.

The evidence for this can be found in the Social Impact report on Waihï released this week by Queensland University. The study looks at many aspects of Newmont Gold Waihï’s effect on the community and the possible effects of mine closure as well. However mine closure is looking less likely at the current global gold price of around $1700 per ounce.

So what’s the economic problem? According to the study Waihï has high unemployment and low wages compared to  other towns in the region.

Waihi has moved from second highest to the highest ranking for deprivation on the New Zealand social deprivation index. There are serious violence, alcohol and drugs problems. Property values are variable but some houses have no value such as the house that fell in a mining related hole a few years. There is a lack of youth and tertiary education opportunities in Waihï  with no post secondary school learning institutions. Add to this the noise the dust and vibration plus the uncertainty about the future.

Newmont Gold Waihi gives quite a bit to charity but their large profits are not paving the streets with gold.

 Martha Hill is now Martha hole and not a dollar has been paid to our Government in royalties for that pit. They have generously set up a fund to monitor the vast toxic waste dump from the mines and the “lake’ inside the pit once they have departed. This will provide some economic activity, especially if there are any dam collapses etc which always assist GDP. But for women, youth, elderly and unskilled people there are few glitters from the gold.

The report also states that tangata whenua have found the industry divisive and destructive in terms of the destruction of the sacred hill Pükewa (Martha). .

The report makes interesting reading considering the fact that large scale open cast and underground mining has been occurring in the centre of town since the mid 1980’s. You would expect a shiny town with a golden glow but alas not.  Wake up Gerry and smell the cyanide use in this industry and count the profits as they go offshore. Gold mining is not a source of wealth and well being in NZ.

22 Comments Posted

  1. Frog your wrong!

    Waihi has done well from the mine.

    I moved to Waihi several years before the Mine was re-opened, and even climbed the hill. (I recall it was mostly overgrown with gorse and pine trees). And as I went to college I watched the hill become a hole.

    The socio-economic issues and effects where there long before the mine was reopened, and have remained largely unaddressed. However I believe it has provided opportunities and employment for many unskilled workers who were willing to work.

    The biggest issue for me was Waihi had and still has little opportunity for the school leaver except mostly low paid unskilled work with low opportunity for upskilling. All Tertiary education required leaving town, and most that did leave for Tertiary studies including me didn’t come back (except for holidays).

    Frog. Waihi will suffer more from the closure of the mine then it ever did from it’s opening (both times round). Even the environment has improved with a clean up of many of the early mining sites to make them safe and accessible for tourists.

    This wouldn’t have happened without NWG’s backing and investment.

  2. Hmmm… my background is showing. I have only ever seen the sites with tailings problems and pollution issues 🙂 Of course you are correct. They haven’t always used the crush & chemical extraction methods.


  3. bjchip wrote:

    “Gold mining has always involved both cyanide and mercury afaik.”

    I understood that the first use of mercury in gold mining anywhere in the world was in the Coromandel about 100 years ago. Gold miners in 19th century Otago and Westland didn’t use mercury.

  4. The Tiwai point doesn’t only employ 1000 people it adds 4% – 5% of our GDP and runs on low emission, renewable electricity (there are worse ways to smelt aluminium say coal fired plants), similar percentage of GDP attributable to Glenbrook and again for mining…

    I want to protect our environment too but any politican that takes 15% from our GDP to do it is out 3 years later and probably never back in again…

  5. The politicians will be right in the miners pocket Jezza that is why they don’t pay royalties and I doubt if they pay the full 30% tax.

    Look at Rio Tinto (formerly Comalco) at Manapouri and how they have completely rorted the system all these years on the pretext of being a large employer at the expence of 340,000 homes of power it uses.

    The large gold mines will be so mechanised as to not be very dependent on labour so it will not make that much difference to the economy of Waihi.

    The process of seperating gold dust from the fine sand requires murcury, gold attracts to mercury and forms into an amalgam. To seperate the gold from the mercury it is necesary to heat the amalgum to evaporate the mercury. This needs to be done at very long arms lenth.

    Gold mining is not a very clean industry and it is causing a lot of environmental damage around the world.

  6. The report says that if the mine closes there will be a lot of job losses, not only from the mine, but also from the rest or the towns businesses – possibly up to the same number of extra losses as from the mine.

    And frog tries to paint a picture of a town that would be better off without the mine – that’s really misleading and not what the report or the townspeople say.

    Frog tries to blame the mine for low house prices, but the report says if the mine closes, house prices could fall (with around 200 houses coming onto market compared to 70 in a normal year), 10% of the town will leave, unemployment will spike, social services will be stressed, schools will be less viable etc etc,

    Newmont spend over $50 million per year to run the mine – take that out of a small town like Waihi – and things will improve????

  7. What a misleading topic, I just read the report and it is about how the closure of the mine would affect the social and economic indicators of the residents it doesn’t examine the mine’s current affect on those social and economic indicators in any way, the only reason they’ve looked at them is to have baseline for future comparison, the report in no way states the mine is the cause of these poor indicators…

    Why have they not been paying royalties..?

    Surely they are paying their 30% corporate tax..? If so it is the fault of government not investing enough in Waihi, surely it’s not the mining companies job to provide a teritary education centre the article states it’s lacking (does Waihi really have the population to support a tertary education centre..?)

    Did the mine cause people to drink and take drugs, is the article implying this to be the case, a mine made them drink..?

    I think examining exactly how harmful mines (in particular open cast mines) may be is very important but high-jacking a report and claiming it says something it doesn’t is harmful to this goal… I think these articles would have more power if they showed a direct link between a mine and the current and social and economic problems rather than saying there’s a mine there and problems, must be the mine’s fault and using an almost unrelated report in an attempt of obfuscation…

    For those interested in what the report actually says here are some extracts:

    “On one hand, the development of a tourism focus and investments in local businesses over the last five years has created a sense of economic activity and optimism, with several people commenting that the town was attracting interest from elsewhere: “I have heard of people looking to move their business to town because of its ‘go-forwardness’”.”

    On the mine’s closure;
    “There were few suggestions amongst those interviewed that Waihi would experience a major impact, with most believing that the town would adjust gradually and relatively smoothly.”

    The most common response from residents interviewed:
    “The most common response again suggested that mining should continue as long as possible.”

  8. AMF! (Variation of OOMPH!) The sound Gerry emits as he hauls himself out of his couch and off to Parliament, where he switches to HARRUMPH!! and OOF!(the Hawaian version) is response to any question directed at him.

    How about ‘rat-a-tat-tat’ – the sound of a gatling gun shooting a blimp out of the sky?


  9. G/fly,
    golly, tack and attack between us — where will this end!

    butter could substitute for better but I heard it is known these days as AMF – anhydrous milk fat – a mouthful and just what gerry looks capable of.. you think?
    BTW: there was an item on Checkpoint(RNZ) not too long after with a guy seeking an investment partner or something. Apparently he’d gotten the permit – mateships influential do this kind of thing – and all they needed to go chase the gold price was an investor..

    oddly I’d say because whatever they start out doing will always lag the price.. and this is hardly a spot price market anymore.. which has me say that whatever they think they are going for, the bright investor will cost them a gold arm and leg unless large volumes are on offer. Looks better asset in the ground to me.

    Which does not resile from my opinion re kite-flying.. but don’t tell gerry I told you so.. 🙂

  10. nommopilot – nice work! Will he be an island or a continent?

    tomfarmer – sharp on attack, eh tomfarmer! Yours is an interesting non-Devil’s Advocate idea and not outside of the realms of possibility.
    I thought ‘butter nature’ might have suited as well.

  11. Sharp as a tack, eh greenfly!

    But allow me suggest another possibility here. And no, before I make this known I am not, repeat NOT, playing devil’s advocate.

    To wit, all of Gerry’s announcements about breaking territorial assets from schedule 4 amount to kite-flying — for leverage on the world stage. Presently so very intense in, on and upon enzed.

    Like I said, not in support the contention he is attempting, merely putting this out there. After all, Minister Gerry would have a better nature. Personal nature that it. Why else is he in the better cabinet. Or, waitta minute, is that brighter now..?

  12. “Gerry Brownlee’s absurd aspiration to be Australia”

    it’s not so absurd. I think Gerry’s well on his way to becoming Australia. the mining council just needs to shout him a few more dinners out and he’ll be there…

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