MINING AND MINERAL RESOURCES

The exploitation of New Zealand's mineral resources began in the sixties with the gold rushes which stimulated development by profitable gold exports. With the exhaustion of these early fields, mineral production fell away. It certainly lacked variety as far as large-scale mining was concerned, but the commonly accepted belief that the country was virtually devoid of economic minerals was far from the truth. Admittedly the production of industrial (i.e., non-metallic) minerals, mineral fuels, geothermal steam, and ground water has increased markedly in recent years while that of metallic ores has dropped. But within the last few years prospecting for iron, aluminium, and uranium has been very active, even when compared with the considerable prospecting demands of industrial minerals – coal, oil, and steam.

Regulations

Mining and prospecting are controlled primarily by the Mining Act of 1926, by its amendments, and by regulations made thereunder. Special acts apply to coal (Coal Mines Act of 1925, and amendments), petroleum (1937), radioactive minerals (Atomic Energy Act of 1945), bauxite (1959), and iron and steel (1959), and to quarries (1944) which comprise all surface workings with faces over 15 ft high, including opencast coal workings. The detailed privileges and obligations regarding prospecting and mining are complex, and depend upon the ownership and form of title of the land, and, if separate, of the minerals.

Most Crown land, most Maori land so declared, and certain alienated Crown and Maori lands are open for prospecting, which may be carried out by the holder of a miner's right, which has particular significance in the case of gold; a prospecting warrant which covers specified lands; a prospecting licence which gives the exclusive right to prospect over marked land of up to 1,000 acres; a tunnel prospecting licence; or a mineral prospecting warrant, which gives the exclusive right to prospect for the specified mineral(s) over an area of up to 10,000 acres. All warrants and licences require vigorous and continuous prospecting to be undertaken, and the reporting to the Inspector of Mines of all mineral discoveries. Provided these conditions are fulfilled, they also give priority in obtaining new prospecting licences or warrants over the same area, and mining privileges over a specified smaller portion of it. In addition, any land is available for prospecting with the consent of the owner or occupier. The Minister of Mines has the sole right to prospect for ironsands and bauxite, but can authorise others to do so.

All precious metals belong to the Crown. Any holder of a miner's right may apply for a claim licence, in an existing or newly proclaimed mining district, in which he is entitled to sole occupancy for mining and to any gold it may contain. Mineral licences may be granted by the Mining Warden for the mining of the specified mineral(s), other than gold, on Crown and certain related lands. Rent and royalties are payable. Depending on the nature of the mineral reservation, licences to work minerals on privately owned land can be obtained under the Mining Act. All workings, however, must conform to the legal requirements of the Mining Act and its regulations, and of the Inspector of Mines or Quarries.

Organisation

Most prospecting and mining in New Zealand has been undertaken privately, although the Government has always given direct and indirect assistance. At the height of the gold rushes of the sixties the basis of mining was the one-man claim of 100 ft by 100 ft. But amalgamations of up to 100 acres for special (“extended”) quartz claims, and increases to 2,000 acres for dredge claims, allowed the entry of companies with larger capital resources so that by 1910 a score of companies had paid-up capital exceeding £10,000. By the time of the depression of the 1930s, when small-scale mining recommenced temporarily, three of the few companies left – Waihi, Blackwater, and Rimu (dredging) – each had subscribed capital in excess of £200,000.

The scale of coal mining operations has also increased, although the inheritance of British mining traditions led to the early formation of some large companies. In 1963, when Kopuku Opencast was by far the largest producer and supplied much of its output of 470,383 tons to Meremere Power Station, 16 mines produced over 50,000 tons of coal each, and 13 employed over 100 men. The average figures per mine were 19,500 tons and 25 men for each of 141 mines, with by far the greater number of small mines in the South Island. Comparable figures for 1890 were 4,000 tons and 12 men for 153 mines.

The State entered coal mining with the State Coal-mines Act of 1901, but the greatest expansion of its activities was during and after the Second World War when many private mines were purchased. Kopuku apart, the State mines, which are directly controlled by the Mines Department, produced 65 per cent of all coal in 1963. Most other mining is carried on by parties of a few miners, or by individual owners employing a very small staff of less than a dozen. The only exception, with assured coal reserves, is Glen Afton Collieries Ltd. which not only operates the Glen Afton and MacDonald mines in the Waikato with a combined 1963 output of 253,120 tons, but also has a joint interest with the State in Kopuku Opencast.

Apart from the operations of the State in the Glenorchy scheelite mines during the Second World War, and the interest of certain Government Departments in quarrying (e.g., railway ballast pits, forestry road-metal quarries), all quarrying and metal mining is conducted privately by concerns ranging from one-man part-time operators to major companies working a chain of quarries. Many of the latter combine quarrying with other operations such as transport, cement making, and brick and concrete-block manufacture. On the average three men were employed in each quarry in 1963 for an average quarry output of about 17,500 tons.

Employment and Economic Value

The economic value of New Zealand's 1963 mineral production is summarised in the following table:

*Average

The mineral industry employs men belonging to a variety of trades and unions. Wages therefore show considerable local variations, depending on union agreements and overtime requirements. The average earnings and outputs of miners in State coal mines in 1960 may be summarised as follows: earnings of £3 8s. 6d. to 5 12s. 3d. per shift, according to type of work and location; an overall annual income of about £1,100 for 230 working days of one major shift only; and an annual output of 450 and 2,540 tons per man on payroll for underground and opencasts respectively, or 750 tons for all mines.

No reliable estimates of metal mining costs are available that might be applicable to newly opened mines. State coal mine costs in 1960 ranged from 31s. 8d. per ton in Weavers Opencast, where an area of low overburden to coal ratio is being exploited, through 41s. 2d. at Rotowaro and 44s. at Millerton, the least costly of underground mines, to a maximum of 95s. 10d. at Blackball. The average for all State underground mines was 67s. as against 44s. 4d. per ton for opencasts.

Quarrying and gold dredging costs are variable and, as all enterprises are privately operated, reliable costs are not readily available. Average 1963 recoveries, which must offset both costs and profits, were 10s. and 8½d. per cu. yd. for quarries and dredges respectively.

Income taxation on metal mining recognises the fact that mineral reserves become depleted over the life of a mine and therefore provision is made for what amounts to the return of capital. Companies deriving their income from mining gold, mercury, scheelite, molybenite, lead, zinc, antimony, tin, manganese, and uranium ores, are taxed on half the dividends paid each year until the total of all dividends that have been paid exceeds twice the paid-up capital. Thereafter, the assessment is based on the dividends paid during that year.

Aids to Mining

Direct State aid to mining is by way of conditional monetary subsidies for specific prospecting operations, for roading, etc. The Mines Department administers these, and also undertakes the operation of mining enterprises in the national interest, such as tungsten ore in wartime, gold during the Depression, and coal when necessitated by local conditions. Indirect assistance is given through coal mining research investigations at the University of Otago, as well as through such scientific agencies as Geological Survey and Dominion Laboratory, interdepartmental fuel and power and coal utilisation committees, and educational facilities. These include mining bursaries at the faculty of technology, University of Otago, and evening classes in mining at several centres.

Production and Resources

General:The production of metallic ores has clearly decreased in recent years. That of fuels is increasing slightly, however, and the recent discovery of the gas-oil field in Taranaki is of major importance. The production of industrial minerals is expanding rapidly -both in tonnage used and in the uses found for old and new minerals. Kauri gum was once a major export, and second only to gold in total export value (£25 million). In 1963 it yielded only £12,000 and is likely to become even less important in the future.

There are no known major reserves of any metal ores apart from iron and perhaps aluminium, although further exploration and prospecting in such areas as Northland and the western half of the South Island (especially Nelson and Fiordland) may lead to new discoveries. Reserves of the fuels and of industrial minerals are adequate or large, except for feldspar, mica, phosphate, and sulphur. The quality of some others, such as oil shale, asbestos, bentonite, diatomite, fuller's earth, magnesite, and talc is such that care is required in prospecting, working, and utilisation.

Gold

Official New Zealand writings of 1862 show clearly that the occurrence of gold (whiro) was known to the Maoris, at least in Otago. The first discovery by a European is credited to Charles Ring at Kapanga Stream, Coromandel, in October 1852, but the immediate results of mining and of negotiation with Maori owners were disappointing, and interest decreased temporarily. Meanwhile, gold was reported in several South Island localities, and was found in payable quantities in the Aorere River, Nelson, in 1856, and in the Buller River in 1859. But the New Zealand gold rushes did not properly begin until May 1861, when Gabriel Read, who was prospecting in the Tuapeka district, collected 7 oz of gold in what became known as “Gabriel's Gully” (q.v.). Over 200,000 oz of gold, worth £750,000, were produced from Otago before the end of that year. In the following year, with the Dunstan discovery, production soared. The exploration of the West Coast goldfield was continued under conditions of great endurance and hardship until 1864, when a “rush” to Hokitika resulted from Albert Hunt's 20 oz discovery in the Hohonu nearby.

Gold is found in New Zealand either in quartz lodes or in alluvial deposits. The whole of the Hauraki Goldfield comprised lodes of the former type and had its main centres at Coromandel, Thames, Waihi, and Karangahake. At the former two, the solution and redeposition of gold near the ground surface (“secondary enrichment”) led to the presence of small rich bonanzas, such as enabled the Caledonian Co. at Thames to produce 9¾ tons of gold and pay £554,440 in dividends in its first year (1869). In contrast, the last major North Island gold mine, Martha Mine at Waihi, which closed down in 1952, worked a more extensive but lower-grade ore.

In all other New Zealand goldfields some quartz lodes have been mined, although the gold was probably deposited at greater depths than at Hauraki. Such areas include those at Collingwood, Nelson, where the lodes follow graphitic layers in Ordovician rocks, and at Glenorchy, Bendigo, Macrae's, and elsewhere in Otago, where the gold-bearing quartz lodes occur as multiple veinlets in schist. The most important, however, are those in the Palaeozoic rocks near Reefton, discovered in 1865, where Blackwater (Waiuta) Mine, the last in the South Island, closed in 1951.

During the gold rushes of the early sixties, prospectors soon found that “alluvial” gold was widespread, either in existing South Island river valleys (see map), or in the extensive gravel and sand deposits that had been formed by past rivers. The older Pleistocene gravels have themselves been eroded, and the gold reconcentrated in the richer younger gravels. Some large nuggets have been recovered – the largest over 95 oz in weight. Alluvial gold has been recovered by various methods – by hand, in a dish or pan (“panning”); by playing jets of water on to gravel faces and washing away the less dense material, after perhaps bringing the water from far away by water races (“sluicing”); or by mechanically digging up gravel by a dredge floating in its self-made and movable lake (“dredging”). Today only one dredge remains, and it is responsible for most of the gold production in New Zealand.

Gold production was an important factor in the early New Zealand economy and over 27 million oz worth nearly £125 million have been exported. Peak export years were 1866 and 1906, with 735,376 and 563,843 oz, then worth £2,844,517 and 2,270,904 respectively. Production has declined recently to 33,326 oz, worth £418,872 in 1960. Most known areas have become worked out, and many ghost towns, such as Tokatea near Coromandel, Charleston on the West Coast, and Hamiltons in Otago, have been left as reminders of a romantic and adventurous period of New Zealand's history.

Other Metallic Ores

Silver is alloyed with the gold of all fields, but is most common in Hauraki where the silver : gold ratio ranges from an average of 1 : 2 for the whole field, up to 8 : 1 or so in the south near Waihi. Most of the £4,500,000 worth of silver that has been exported has been obtained from gold mines. Silver mines as such (e.g., at Puhipuhi and Great Barrier in Northland, and Collingwood in Nelson) have not been economic. Small quantities of platinum and osmiridium have been recovered from the gold at Orepuki in Southland. Only small amounts of lead and zinc minerals have been found. Trial shipments have been sent overseas from Thames gold mines, and from prospecting in Toi Mine near Te Aroha. The minerals have been found in the western half of the South Island, but are nowhere known in economic quantities.

Like the gold from Hauraki, many New Zealand metallic ores are related to past volcanic activity. The andesitic volcanic rocks of Mt. Egmont, and of its eroded ancestors in the Pouakai Range to the north-west, are exposed along 70 miles of coastline around Cape Egmont. The grinding and sorting action of the sea has released and concentrated titanomagnetite, a resistant iron mineral, which occurs in small amounts in the parent andesite. The beaches and the coastal sand dunes from Kaipara Harbour to Wanganui are known to contain well over 500 million tons of magnetically separable titanomagnetite concentrate, analysing 56 per cent soluble iron and 0·36 per cent vandium oxide. In addition to the iron, 7 per cent titanium oxide is present, and this has so far thwarted attempts to produce iron and steel economically; but research continues. West Coast South Island blacksand deposits, formed by the erosion of granite, are rich in ilmenite with 40–45 per cent titanium oxide, and include a deposit with 5 million tons of concentrate near Westport. Limonite, a brown iron oxide which was indirectly formed by the weathering of basalt lava flows, has been quarried at Kamo, Okaihau, and Puhipuhi in Northland. It is used in improving cement, in gas purification, as a pigment, and, at one time, as a fertiliser, mostly because of its cobalt impurity. The limonite at Onekaka, in Nelson, of less certain origin, was worked to supply a small blast furnace. Some 37,560 tons of pig iron were produced in 1922–35, and 9½ million tons of ore, with 35–55 per cent iron, remain. Subtropical weathering of basalt flows in the Kaeo region of Northland has led to the formation of the aluminium ore, bauxite. Some 20 million tons have been proved so far, with 37 per cent aluminium and 25 per cent iron oxides.

Over £50,000 worth of cinnabar, the heavy red ore mineral of mercury, has been obtained sporadically since 1918 from the active and extinct hot spring areas at Ngawha and Puhipuhi respectively, both in Northland. Small amounts have also been worked at Thames and Paeroa, but no mercury reserves are known.

Some metal ores, such as the manganese and copper of Northland, are associated with volcanic lavas that were erupted into soft sediments beneath the sea. Almost all the 26,000 tons of manganese ore mined in New Zealand has been produced from volcanic horizons in the greywacke rocks that extend from the small, closed mines of the Hunua Ranges, south of Auckland, to the Bay of Islands. Past experience suggests that, although additional deposits will be found in the future, they are likely to be small and of doubtful economic value. Copper was found in the Kawau manganese mine about 1840, and thereafter this mine, like that at Great Barrier, produced well over 2,000 tons of ore. Copper, which is known from marine volcanics in several other parts of Northland, was mined at Pakotai in 1947–51 and is being prospected at Parakao nearby. Much copper prospecting and mining took place in the mineral belt of Nelson, extending southwards from D'Urville Island. As elsewhere in the world, chrome ore (chromite) is found in serpentine rocks, and £38,000 worth was mined in Nelson's mineral belt in 1858–66 and 1900–02.

Arsenic worth nearly £2,000 has been obtained as a by-product of Reefton's gold mines. Antimony, which is widely used in alloys and drugs, was also found there, but was more extensively mined from the schist rocks of the South Island. The largest mine was in the Marlborough Sounds, and smaller mines were at Alexandra, Waipori, and Mt. Stoker in Otago. The schist rocks also yield scheelite, a white heavy ore mineral of tungsten. Farmer-miners still work the once important Glenorchy field. Mining there, and at Macraes Flat, together with smaller operations at Wakamarina in Nelson, and Hyde, Waipori, Stoneburn and elsewhere in Otago, has produced exports to the value of £875,000. Tin and another tungsten mineral, wolfram, have been recorded together from the area of the granitic rocks in Stewart Island, an association found elsewhere in the world. Only about a ton of tin ore (cassiterite) has been recovered from auriferous gravels there, and considerable prospecting has located no major field.

The world-wide search for uranium after the Second World War spread to New Zealand. The first discovery was made in the Hawks Crag breccia in the lower Buller Gorge in 1955, followed later by additional records in that formation in the Paparoa Range south of the Buller. Unfortunately, bulk samples have nowhere shown the presence of a workable deposit.

Coal

The Maoris knew of many occurrences of coal (waro), and most New Zealand coalfields had been located by Europeans before 1870. Recent “discoveries” have amounted to little more than extensions of existing fields, either laterally or in depth. During the First World War, coal displaced gold as the most valuable mineral mined annually in New Zealand. It retained this position into 1960, but was itself then being fast overhauled by the constructional bulk materials – sand, gravel, and crushed rock.

New Zealand's mined coals were formed from peat which in Cretaceous to Miocene times accumulated in swamps that were probably not unlike those of the present-day Waikato and Hauraki plains. They similarly contained the debris of small plants, such as mosses, ferns, and grasses, with the larger trees adding little more than such material as resin. Peat is changed into coal predominantly by the application of heat and pressure, either due to nearby hot volcanic rocks, or, most commonly, to its being buried deeply beneath other sediments. Its alteration can proceed through lignite, sub-bituminous coal, bituminous coal, and finally to anthracite, as first the water content and then the volatile constituents (including gases) gradually escape, and the heating power increases. The production and reserves of coals of these ranks are shown in the map together with the location of all coalfields.

Lignite, in which plant material can still be readily identified, is mined at Charleston (Buller) and in many parts of Canterbury, Otago, and Southland. It has a relatively low heating capacity, and many scattered seams in both islands are considered too poor, on this account, to mine.

Sub-bituminous coals, which are the most widely mined in New Zealand, are dull black in colour, break with a glassy fracture, and are reduced to slack more or less quickly when exposed to the sun and air. All North Island coals are sub-bituminous. The last major Northland mine, Kamo, closed in 1955, and the field is largely worked out, but the reserves of the buoyant Waikato fields – especially Maramarua, Huntly, and Rotowaro – are considerable, and include over 30 million tons of coal suitable for opencast working. The Taranaki field has reasonable reserves, but, like the West Coast sub-bituminous field at Buller Gorge, and the Puponga, Murchison, and Reefton fields where the coals are marginal between sub-bituminous and bituminous, the seams are in relatively inaccessible country or far from the customer, and major developments are unlikely in the immediate future. Sub-bituminous reserves are relatively small at Kaitangata (Otago), where the new Lockington Mine opened in 1957. By contrast, the expanding Ohai (Southland) field with its large Linton, Morley, and Wairaki mines and several opencasts, has ample reserves, including over 6 million tons suitable for opencast working.

Bituminous coals are a brighter black in colour, break into more blocky fragments, and mostly have the property of swelling or “coking” when heated. These are the coals normally used for gas making. Their occurrence is restricted to the west coast of the South Island. Mining problems include the descent of coal off the 2,000 ft Millerton-Stockton-Denniston plateau north-west of Westport, and the structural contortions of seams, and therefore of mine workings, in the Garvey Creek (Reefton) coalfield. At Grey-mouth, large mines have worked in the Runanga, Blackball, Dobson, Rewanui (e.g., Liverpool) and Nine Mile (e.g., Strongman) districts. Some coal at Roa has the highest swelling properties in New Zealand, and possibly in the world. The West Coast's bituminous coal reserves appear ample on paper, but adequate drilling is impossible in this difficult terrain, and the opening of mines is therefore more hazardous than elsewhere. In addition, many seams, especially in Buller, have too high a sulphur content (2–10 per cent) to find a ready market.

Anthracites, which have lost most of their water and gas by natural processes, are steel-black, are composed predominantly of carbon, and have the greatest heating power of all. They are found in the inaccessible Fox River area of the West Coast, and have been mined in Canterbury where a lignite has been altered very locally by a volcanic intrusion.

The thicknesses of New Zealand coal seams are extremely variable, reaching 100 ft in several localities. Most underground mines, however, work seams that range from 6–20 ft in thickness, and have all adopted the “bord and pillar” method of working. An initial driving of a square network of tunnels (“bords”) is followed by a final removal of the remnants (“pillars”) of the coal seam. Power drills and coal cutters are becoming normal mining equipment, and mechanical loaders have been introduced into some larger mines. More commonly, miners shovel the coal into wheeled “skips” which the truckers then manhandle from the face to the steel ropes, for mechanical haulage from the mine. Very few New Zealand mines have been entered by a shaft, and none of these is now working. Hydraulic mining by jets of water, and the transport of coal by water in flumes, have both been adopted at a few mines in Buller and Taranaki. Opencast mining became common about 1944 and opencast production rose from being 16 per cent of the total (i.e., 452,680 tons) in 1945, to 41 per cent (1,120,017 tons) in 1963.

The past output and present reserves of the various coalfields are shown in the diagram. The steady increase in recent years to a record annual production of 3,012,043 tons in 1960 has been due in large measure to the construction of the Meremere Power Station at Mercer which in that year consumed over 600,000 tons. Of the other production, general industry uses about 1 million tons (of which half is consumed by dairy factories, cement works, and freezing works); the domestic consumer uses¾–1 million tons as coal or briquettes and¼ million tons as gas; while railways and shipping are using a steadily declining quantity in the face of competition from oil. The increasing concentration of population in the North Island and the comparative increase in mining costs in the less accessible areas over the last 50 years, have led to an increase of production of the Waikato coalfields from one-eighth to one-half of New Zealand's total, a reduction from one-half to one-third for the West Coast of the South Island, and a marked change from the use of lignite to sub-bituminous coal in Southland and Otago.

Oil

For the commercial production of oil to be possible, several geological requirements must be satisfied. There must be thick “source beds”, i.e., sedimentary rocks which originally contained organic material; a degree of alteration to those rocks, such that the organic material is changed to oil (and/or gas), yet not so great that the rocks became excessively hardened and the oil lost; a “reservoir bed”, in the pore spaces of which the oil may collect during an upward movement brought about by its relatively low density; an impermeable “cap rock” in a traplike shape such that the upward movement is halted; and, finally, an absence of fracturing that might allow the escape of the trapped oil. Geological investigations to find oil areas satisfying these conditions began as early as 1860, and many holes have been drilled from Northland to Southland. Most interest has centred around those areas where oil seeps have been discovered at the ground surface.

In 1911 a reward from the Government of £2,500 for the first 250,000 gallons of oil produced was awarded to the Taranaki Petroleum Co. which was drilling the Moturoa field at New Plymouth. Since then, a total of over 6 million gallons have been refined and sold locally, along with considerable quantities of gas. The modern use of geophysics has allowed reasonably accurate inferences to be made of the detailed structure of unseen rocks deeply buried beneath the ground surface, hence the recent successful drilling at Kapuni and Mangahewa in the same Taranaki region, by Shell B.P. and Todd Oil Services Ltd. A large gas field was discovered, with subsidiary but important oil in the form of a condensate, from a hole drilled to a depth of over 13,000 ft down to thick Eocene coal measures.

Many other areas have been prospected, but oil has been located outside Taranaki only at Kotuku near Greymouth, where a few thousand gallons have been recovered. The East Coast of both islands has so far proved to be too complicated geologically and/or too broken structurally to allow any oil that might have been present to be exploited.

Oil shale is reported from several localities such as Doubtless Bay and the East Coast of the North Island, but appears to have economic possibilities only at Orepuki, Southland, and Nevis, Otago. At the former, 14,000 tons of shale, worth £7,236, yielded a relatively high figure of 43 gallons for oil per ton when worked in 1899–1903. Its reserves, placed at only 7 million tons, make it a less attractive proposition for the future than the hypothetically richer areas at Nevis, where a total of 90 million to 2,000 million tons of shale are estimated to average 12·6 gal of oil and 146 lb of ammonium sulphate per ton.