Poisoning paradise? The gold mine set to tear apart a community and country

Sunday, 21 September 2025

Cyanide contaminating an iconic river, or rivers of gold for Central Otago? Arsenic poisoning famous pinot noir vines, or growth, jobs and prosperity? A controversial gold mine in Central Otago is dividing a community and country, and highlighting fears about irreversible decisions. Mike White investigates.

Simon Gibbard sat in the second row of the church hall, wearing a black cap, green jersey, and a look of utter despondency.

Around him were 200 people who’d gathered on a black and bleak June night in Wānaka to hear about a proposed gold mine on Central Otago hills famous for pinot noir and Shrek the rogue merino.

Gibbard knew all about the mine. How it was touted as the country’s richest gold strike in 40 years; how its owners were promising hundreds of jobs; how its riches would spread through Cromwell and beyond.

He knew how there would be four huge pits dug into the hills, the largest 1km-wide and 200m deep, that would never be filled, other than with polluted water. How there would be a 2km-long tailings dam with toxic slurry, left forever when the mining company walked away. How the processing plant, with its noise and lights, would operate 24 hours, seven days, for at least 14 years.

Gibbard knew all this because he lived under the proposed mine, on an 8ha olive grove, with his family.

But, better than anyone in the hall that night, Gibbard knew what the mine might truly mean for the community. Because for 40 years, since leaving school at 16, he’d been a miner, becoming an international tunnelling expert.

So when the microphone was handed to Gibbard, he sent a warning.

About the toxic dust that would blow across the region. About the chemicals that would inevitably leach into the aquifers and the Clutha River. About the effect on the region’s wine, fruit, tourism and farming industries, as their reputations became sullied.

About how this was just the first of many mines that would irreversibly transform Central Otago’s landscape and lifestyle.

About how the mining company had its head in the clouds about its effects, and the public had their head in the sand about what was about to happen.

Leaning on the seat in front of him, Gibbard was more resigned than relaxed.

“When you speak to people up and down the country, they go, ‘Oh, Central Otago’s great.’

“Well, that’s all going to come to an end. It’ll be the last place people will want to go to.”

There was anger and heartbreak in every word, a trace of desperation in every impromptu sentence.

It wasn’t often he spoke about it.

He couldn’t talk about it at home with his partner, Gibbard acknowledged.

When he did, they just cried.

Drill Baby Drill

From 2012, new exploration around the Dunstan Range near Cromwell indicated likely gold.

Given Central Otago was home to New Zealand’s first major gold rush in the 1860s, it wasn’t surprising undiscovered reserves remained buried among dry hills.

In April 2021, test drill MDD007 - “the James Bond hole” - indicated more than two grams of gold were encased in each tonne of rock, 40m beneath the surface.

In geological reality, that’s the equivalent of a teaspoon of gold in every 40 tonnes of rock.

But the economic reality is that with gold soaring to over $5500 a troy ounce (31 grams), mining suddenly became viable.

The company with exploration permits for the area was Santana Minerals, an Australian company, though 40% of its shareholders are New Zealanders.

Formed in 2013, it had interests in Mexican and Cambodian mines, but has never built a mine.

In 2020, Santana bought the company that had done initial prospecting in the Bendigo area near Tarras, and continued testing.

Santana CEO Damian Spring says they soon realised they had “the tiger by the tail”, and began planning a giant open-cast mine known as the Bendigo-Ophir Project, across two sheep and beef farms.

Spring admits the New Zealand mining industry had become stagnant, with a social and political focus on conservation, and climate change.

But a new government in 2023 changed that.

When New Zealand First’s Shane Jones became Minister for Resources, and Regional Development, he quickly promoted economic benefits over environmental sustainability.

“No more eco-romanticism,” Jones thundered in Parliament, promising to “turbocharge” the mining industry, appearing in Parliament wearing a “MAKE NZ GREAT AGAIN: DRILL BABY DRILL” cap.

At the 2024 Diggers and Dealers conference in Australia, Spring clapped and smiled as video of Jones was played, telling the audience, “So, we have our champion.”

And one way mining is being ignited is through the Fast-track Approvals Act, which bypasses local councils’ role in such major projects, and puts responsibility in the hands of a panel, which doesn’t need to hold hearings, and makes decisions within six months.

In essence, Santana being on the verge of creating one of New Zealand’s largest mines is the result of a perfect confluence of favourable factors: The high price of gold, a sympathetic government, simpler processes, and a promising gold find.

The numbers Santana presents are as dazzling as the gold they’re seeking to mine.

A recent presentation included the phrase “Cash Machine”, alongside a graphic of a piggy bank with coins being dropped in, and the promise of “$2.5 billion free cash”.

Santana estimates it will recover 1.25 million ounces of gold, resulting in $6.9 billion gold sales over the mine’s 14-year life.

New Zealand would reap around $1 billion in taxes, and nearly $500 million in royalties, not to mention the 360-plus jobs with an average $140,000 wage, and spin-off benefits to local companies.

“Gold price could halve, and the project is still very profitable,” the statement concluded.

But if Spring and Santana expected everyone to be bewitched, they quickly confronted a community with many unenthusiastic about having a mine on their doorstep.

That community included people like Gibbard with deep mining experience, and, more importantly, many who knew how to fight big corporates bustling into town with big promises.

Land wars

Drive over the Lindis Pass from Mt Cook and Mackenzie Country, and the first town you hit is Tarras. It’s barely a town, more a village, with a few shops, great cafe, petrol bowsers, and public toilets.

Its population is somewhere between 250 and 800, depending where you draw its boundaries. Wānaka and Cromwell are both about 30 minutes away.

It was here, in 2020, that Christchurch Airport announced it would build a new international airport, and bought 750ha of farmland.

The extremely controversial project sparked the formation of Sustainable Tarras, opposed to the airport and the landscape’s industrialisation.

At the same time, Tarras residents were fighting an application for a gold dredge to dig along the Clutha River.

By 2024, the dredge had been refused consent, and the airport plans put on hold.

So when a third major proposal was announced for the same tiny community, residents were well-skilled and schooled in how to respond.

Two years ago, Rob and Cherry van der Mark stood on their small Bendigo vineyard, imagining giant jets roaring overhead.

Today, they stand among their vines, and wonder what a gold mine 10km away will mean.

But they’re not just talking about any impact on their grapes.

More pressing is the wider effect on everything the region is renowned for: Its wine, fruitgrowing, tourism. Its rivers and lakes. The entire image of Central Otago.

Rob van der Mark lists the basic environmental concerns.

How the rock Santana would blast and grind to sand would release arsenic as fine dust, which would be spread by the area’s notorious winds.

How the cyanide used to extract the gold - up to 1900kg a day - could leach into streams the mine straddles, eventually poisoning the Clutha River and Lake Dunstan, as well as crucial aquifers.

How the tailings storage facility, where 10,000 Olympic swimming pools of toxic slurry containing arsenic and cyanide pumped from the processing plant, would remain forever.

How the dam holding it in place could be breached by significant earth movement.

How the mine’s permanent slashes into the land, some of which is protected by conservation covenants, would be the first thing visitors saw of Central Otago, from planes descending into Queenstown; and would be visible from SH6 for up to 8km as people drove between Wānaka and Cromwell.

Van der Mark points out Santana won’t release its environmental studies until it files its fast-track application.

So the community is being asked to take everything on trust, van der Mark says, from a company driven by profits and the demands of its overseas shareholders, and whose actions till now he describes as “cavalier”.

“Damian [Spring] says there will be no lasting effects from this mine. How the hell can you say that?”

One of the biggest concerns van der Mark and others have is that if Santana gets approval for its mine, many others will follow in the same area.

Already, a number of foreign companies have licences to explore for gold across Central Otago, all the way towards the country’s largest gold mine, Macraes, 90km east, near Palmerston.

“People say, ‘You’re anti-development.’ I’m not at all anti-development.

“In fact, quite the opposite. But it needs to be the right development in the right place.”

Boon or bust?

Damian Spring remembers the murmurs among miners in 2021 about the 007 test drill, and the riches it hinted at.

“Every few months, you hear of a screamer, but you’ve got to get some context.”

Within two years, however, Spring had become Santana’s chief executive and cheerleader, a job he describes as “the ultimate” in his three-decade career.

Since then, he’s heard all the criticisms and concerns about the proposed mine, but insists it’s a good news story, and has called opponents’ claims misinformation.

Santana’s headquarters are tucked in Cromwell’s industrial zone, across from a farm supplies outlet, down the road from a bustling pie shop where tradies in work boots and utes swing by to grab morning tea.

The office was once a funeral home, and is functional not flash, with garish curtains beloved by middling motels the country over.

Spring, 55, with three sons who’ve left home, lives 40 minutes down the Kawarau Gorge, in Arrowtown.

Forty minutes the other way, along Lake Dunstan’s serene edge, right at the one-way bridge, and up Thomson Gorge Rd past Simon Gibbard’s house, is the mine site.

First is where the camp/caravan-park housing 80 people for up to two years during the mine’s construction will be built.

Then there’s the 1km-long processing plant, where rock blasted from the pit is ground finely so gold can be extracted using cyanide.

On a ridge between two creeks is the main 1km-wide Rise and Shine pit (beneath which underground mining will begin after seven years), with three other open pits nearby.

And then at the head of a valley is the 2km tailings dam where toxic residue is pumped and left.

In total, the mine covers roughly 5km x 3km.

But beyond that, towards Omakau, the Maniototo, and the Otago Central Rail Trail, is more land Santana is exploring, eyeing future mines.

Santana has invested millions into this project already, including offering $25 million for one of the farms the mine is on.

It needs to raise $310 million to construct the mine, but promises quick returns if mining starts in early 2027 as planned.

Before that can happen, Santana needs approval from a panel that will consider its fast-track application.

And this has seen the mine become a poster-child of the divisive legislation, with concerns how devastating developments are being rushed through without adequate public consultation.

Santana hopes to file its fast-track application, including all required environmental and economic reports, “imminently”.

After that, the public or environmental groups or Central Otago residents have no input or influence. Only councils, DOC, iwi, and adjacent landowners can make submissions, and they have just 20 working days to respond to Santana’s application.

The fast-track panel is expected to make a decision within six months, and Santana is predicting it will begin mine construction in early 2026.

Spring insists they must still meet all normal resource consent requirements, it’s just the panel deciding whether the mine goes ahead is a one-stop shop, promising speedier decision-making.

Of course there will be impact, Spring says - they’re an extractive industry. But nothing like what critics are predicting. And he stresses Otago has been affected by human development for centuries.

In a quote opponents frequently revisit on him, Spring said the mine would be like “a chip in your windscreen” for passersby, but he sticks by that, saying only passengers knowing where to look will see it.

For tourists arriving in planes, the mine won’t be anything larger than skifields or other developments in the area.

Typical of this sort of inflamed debate, both sides hint at majority support, and suggest opponents are overstating their base.

Spring is no different, saying over 99% of people want to hear about the jobs and business opportunities the mine offers, and Sustainable Tarras, the group opponents have coalesced under, is just one voice.

“They’ve done a lot of internet research, and pulled up probably the worst examples you can find in about five minutes of Googling.”

These are Spring’s answers to detractors and doomsayers:

• Dust: Modelling predicts arsenic-laden dust will only travel up to 600m, meaning everything will be contained within the site, with water suppressing dust on haul roads and during blasting.

• Cyanide leaching into waterways: Concentrations will be reduced so what is discharged into the tailings dam is safe for wildlife. Spring absolutely guarantees toxins and chemicals won’t reach the Clutha River. “I’ve lived here for 20-plus years, I’m not about to damage my own backyard.”

• The toxic tailings storage facility: A closed-loop system will mean nothing escapes from the site. The dam will withstand a 1:10,000 year earthquake.

• Noise and light: Efforts to reduce effects from the mine’s 24-hour operation will be engineered into its design.

• After the mine: The pits won’t be filled in. But there will be extensive planting. Environmental bonds Santana will pay to local councils will only be refunded if all requirements are met.

• The effect on other industries and Central Otago’s image: “Gold mines are part of Otago. That’s why we have such positive response from [people at] drop-in sessions - they want to see another gold mine operating.”

Here are some other figures, provided by Santana:

The mine is applying to take 110 litres of water a second from a nearby aquifer. In summer, half of that will be for suppressing dust.

It will use around 10MW of electricity - similar to a town like Cromwell.

It will use 10-15 million litres of diesel a year, accounting for most of its greenhouse gas emissions - but Santana isn’t required to say what its emissions are until 2028.

Already, 1000 people have applied for jobs.

Spring insists they’re trying to mitigate their impact. But he’s also clear whose drumbeat he marches to.

“We are fundamentally here for our shareholders. They are the ones who will take us to task if they don’t get their return on their investment.”

Good as gold?

Spring says the mine will be the most valuable in New Zealand.

Broadly, it breaks down like this: At current prices, the mine will generate $500 million in gold sales a year. It will have cost about $200 million to produce that gold, and another $100 million in taxes and royalties, leaving $200 million a year in profits.

The estimated $1.5 billion in taxes and royalties over the mine’s life is reason for celebration, Spring says.

“They’re great numbers. A hundred million bucks a year - that’s a school or two, or a hospital.”

But Massey University mining expert Professor Glenn Banks says the numbers aren’t likely to be as dazzling as portrayed in Santana documents.

“Almost certainly not. My initial reaction is an eye roll.

“They’re going to market looking for an investor. And what the investor wants to hear is, ‘It’s $2.5 billion in free cash.’ But the $2.5 billion is not going to stay in the country, that’s for sure.”

And Banks says mining is expensive, with costs often eating into profits, meaning little or no corporate tax is paid some years.

Socially, a gold mine had huge effects on others, Banks says.

“It’s not a land use that’s easy to live next to, and I can understand the concerns of the tourism operators and vineyards.

“One of the key things Santana have to come to terms with is they need a social licence to operate. They need the community behind them, in a way that it clearly isn’t now.

“In some sense, I wonder if Santana are too late to get on good terms, at this point.”

(Last week, Santana announced a community liaison group - but it controls the group and who is on it, and has been rejected by Sustainable Tarras.)

Banks says it would be unsurprising if the mine’s life was extended, as happened with Macraes, which was initially predicted to last seven years and is now 35 years-old.

“It’s so much easier to expand a mine than open a new one. So that foot in the door is really, really important to them.”

The success of Santana’s application could dictate the region’s future, Banks says.

“It’s a major moment for Central Otago.

“Other prospectors are lining up, waiting to see what happens.”

With this came inevitable risks, Banks says, the volatile mining industry being littered with stories of failed speculators and bankrupt companies.

“They’ll pack up and go home. And they’ll leave a hell of a mess.”

Nimbys and naysayers

It’s all too easy to conjure disaster scenarios, says Doug Patterson.

Patterson, who lives in nearby Wānaka and has worked in mines across Africa, Argentina, Mongolia and the Philippines for 40 years, is welcoming Santana’s project.

He says mining operations have improved immeasurably, and were heavily regulated.

“But there’s this small minority that just want to preach doom and gloom and it’s bad for the environment. And people naturally respond to fear-driven stuff.”

While the mine wouldn’t be pretty, the jobs and flow-on benefits to everyone from the petrol station to the pie shop, would be huge.

Moreover, everyone used material from mining, Patterson says.

“So it’s pretty one-eyed when they say it’s all bad.”

Patterson says he might apply for a job.

So would Tarras local Peter Beauchamp.

“First of all, I thought, ‘Bloody miners, wrecking the countryside.’

“But looking into it, and seeing it’s well away from anyone, I thought it’s probably not that much of a problem, considering the benefits of all the employment, and tax gains for the country.”

Beauchamp says farming creates huge amounts of dust and affects waterways; vineyards fight frosts with noisy helicopters, and spray chemicals that can spread into the environment; and tourism puts enormous pressure on the environment and infrastructure.

The mine would mean locals didn’t have to make a daily 60km round-trip to Wānaka or Cromwell for work.

And while he understands some people shifted to the area for a quiet life, many are just “whinging lefty wankers, in my opinion. The hypocrisy and idiocy of some of them is unreal.”

While admitting the mine is splitting the community, Beauchamp believes it will go ahead.

“And I’ll be the one waving the flags and banners going, ‘Yahoo.’”

High stakes

Overlooking the proposed mine site, Rudi Bauer struggles to understand how things have got this far.

How people are willing to risk pristine waterways and iconic landscapes for the promise of a few hundred jobs, in a region with the country’s lowest unemployment rate.

How a region whose industries are based on environment and beauty and romance can be considering something that’s the enemy and antithesis of all this.

How a country spending millions to attract new visitors, and resurrecting the 100% Pure global marketing campaign, would put a vast open-pit mine and toxic tailings dam in the middle of one of New Zealand’s tourist gems.

Bauer pioneered grapes in the Bendigo area with his Quartz Reef vineyard 30 years ago.

He bought 30ha from John Perriam of Shrek the sheep fame, who is now allowing Santana to mine his land.

Bauer, a leading wine industry figure, is frightened by the threats to his organic and biodynamic vineyard and the region’s wine industry, saying vine and mine are impossible neighbours.

“We can have economic growth without dismantling the landscape.

“This economic growth is utterly irresponsible in the long-term, for the community, and, most importantly, the reputation of New Zealand.”

Standing nearby, Tessa Sole says she feels like a giant is striding across the landscapes she loves, doing what it wants, without any concern for the effects on so many other people’s livelihoods or right to enjoy the area.

She points to the complete clash between Central Otago’s sales pitch - A World of Difference - and what is about to blight it.

Sole learnt about the proposed mine from her father, archaeologist Matt Sole, who has studied the area for years.

But she wonders how many people will only wake up to Santana’s plans when it’s too late, when the mine has been fast-tracked, and the diggers have appeared on the hills.

Tarras or Terra Nullius?

There’s a quip attributed to Mark Twain that a gold mine is a hole in the ground with a liar standing next to it.

Chris Goddard has heard that one plenty of times during his 30 years in the mining industry, where he’s seen good and bad operations.

The Tarras resident doesn’t know where Santana’s mine stacks up on that scale, but knows where the issues will be, based on his experience.

Given the area’s notorious winds, if Santana could contain dust to 600m, “it would be the tidiest mine on the planet”.

The millions of litres of water used to suppress arsenic-laden dust on roads wouldn’t all evaporate, and some would inevitably leach into groundwater and waterways.

“Every mine I’ve ever seen, something has gone wrong at some point.

“Miners are a well-intentioned bunch, but no miner yet has managed to keep, using a mining term, its shit in a sock, all through its life.

“Would I be worried about my grandchildren living in Tarras without everyone having an A+ water filtration system for potable water? Yes.”

But Goddard’s most immediate concern is how Santana has “thrown the playbook out the window” when dealing with Tarras, and attempted to ignore it.

Its recent 16-page update on the mine doesn’t mention Tarras once. The town is redacted from maps.

“It’s not a modern miner’s way to start a fight with the adjacent community.

“The best time to engage was before now. The second-best time is today.”

Goddard emphasises that allowing the mine would mean permanent change for Central Otago.

“It’s a one-way street. If you invite mining into your community, it’s not going to go away any time soon.”

Into the unknown

The end of August.

Another church hall.

Another public meeting.

This time, 150 people gathered in Cromwell to hear concerns about Santana’s mine.

Simon Gibbard was there, highlighting how Central Otago was at a fork in the road: Either it preserved the reputation its numerous tourism, wine and fruitgrowing businesses were based on, or opened the door to overseas mining companies, with Cromwell becoming another Kalgoorlie.

Sitting towards the rear, listening to sceptics of his mine, was Damian Spring.

Afterwards, he was surrounded by attendees offering advice and opinions.

A voluble lawyer assailed Spring, hugging a course between hectoring and lecturing. He sprinkled names, he sprinkled Latin.

“I don’t want to be here cross-examining you,” said the lawyer whose assuredness eclipsed politeness.

“Well, it sounds like you are,” smiled Spring.

“I live just over the hill,” Spring said, as the circle around him swelled. “I’m not going to do something that’s going to be a poor legacy for me personally, let alone all my workers.”

By the time everyone had finished with him, the cups of tea had run out.

Spring thanked the organisers. “Well run meeting.”

And then he headed out into the night, alongside those who saw him as a herald of calamity, or a prophet of prosperity.