Golden age or golden goose? Mining claims challenged
Thursday, 21 May 2026
The benefits of mining in New Zealand have been consistently overstated, a mining symposium has heard, and the industry wouldn’t provide an economic panacea for the country.
“Mining, under the current regime, will not contribute significantly to the national economy,” Massey University geography professor Glenn Banks said during a discussion on critical minerals and the role of mining in New Zealand, at Victoria University on Wednesday.
Banks said New Zealand’s low mineral royalties regime; mining companies being foreign owned; volatile company tax payments; fluctuation of mineral prices; and lack of a supporting infrastructure meaning many things had to be imported, all undermined assertions of mining’s benefits.
“The economic contribution of mining generally is consistently overplayed.”
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Banks took issue with those who suggested New Zealand simply needed to increase mining to be a richer nation, like Australia.
“Resource extraction is not the reason for the difference in wealth between Australia and New Zealand.”
And he challenged those claiming mining brought wealth to areas where it operated, pointing to two of the country’s major mining areas - Buller and the Hauraki region - having some of New Zealand’s highest socioeconomic deprivation.
Banks said recent claims that critical minerals could make a major economic contribution to New Zealand were wrong.
“Critical minerals are not going to transform regional economies,” Banks said, noting many were found in very small amounts, and highlighting the spiking and rapid collapse in the value of numerous minerals in recent years.
“A single policy change in China can halve prices on billion-dollar projects.”
He warned mining companies they needed social licence if they wanted to be successful, and to do this, they had to listen, build relationships, and be honest.
“And don’t adopt the Shane Jones shouty approach. We need to find ways of living well with extraction.
“The sector needs to realise cowboys in government will come and go,” and companies needed to take a long-term approach.
Banks stressed mining was not like the dairy industry where, each year, companies got another chance to get it right.
“With mining, you get one shot. Once it’s extracted, it doesn’t jump back in the hole to be extracted again.”
However, the chief executive of mining advocacy group the New Zealand Minerals Council (formerly Straterra), Josie Vidal, pushed back at suggestions mining didn’t contribute significantly to New Zealand’s economy.
“Opening a mine in New Zealand is not for the faint-hearted. It’s a long process that requires large sums of money - and those large sums of money come from offshore.”
But Vidal said it was a mistaken belief that money produced from New Zealand mining therefore also went offshore.
While she admitted royalty rates were low, Vidal said the focus should be on how much was paid in corporate tax and PAYE, and how benefits flowed to the broader business community.
“It’s a high wage, highly productive sector, so those wages get spent at the local coffee shop.”
Moreover, mining companies contributed more than $3 million to local communities each year, Vidal said.
“Sure, you can say, ‘It’s big corporates buying their way in.’ So what. Hundreds of thousands of dollars, millions of dollars, actually, goes into schools, sport, healthcare, community projects, and even environmental projects.”
Vidal decried New Zealand’s negative attitude to mining and making progress, compared to Australia.
“I think they have a more optimistic view there, and I think it’s a shame we don’t have that. I actually sent my child to Australia and said, ‘Don’t come back, because there’s nothing for you in this country.’”
Vidal insisted New Zealand had high regulatory standards, which protected worker health and safety, and the environment.
Vidal’s claim was met with disbelief by ecologist Mike Joy, who was also on the symposium panel.
“The idea we have strong regulations is just bizarre. Just look at Pike River as an example of the failure of regulation. We have a freshwater disaster here because of the lack of regulation and enforcement.”
Independent consultant Sefton Darby, who has worked at the Waihī gold mine, and was the national manager of minerals for the Ministry of Business, Innovation and Employment, warned against rushing to consent mines without fully understanding the effects.
“Mining companies say, ‘It has to be now, it has to be now.’ Well, actually, if we have uncertainty about the impacts, it doesn’t have to be now.
“Let’s wait until we’ve got enough public science to understand the impacts properly, and then let’s come back - because it’s still going to be there in 20 years’ time.”
He also cautioned against accepting the mining industry’s hyped claims of benefits and understating of risk, saying exploration companies acted like tech startups, with projects being a “massive speculative geological bet dressed up in data”.
Darby, who now works in Australia, said New Zealand mining companies spent a fortune on exploration, but only a fraction of that on consultation, and weren’t equipped to deal with social, environmental, and cultural impacts.
“I hate to be the person that comes over from Sydney and tells you you’re 20 years behind Australia, but you are when it comes to this.”
He said extensive studies had been done in Australia about relations between mining companies and communities.
“Again and again and again, trust comes out as the biggest driver of acceptance (of projects).”
That trust didn’t come from promises about jobs and economic benefits, Darby said, but from people believing the procedure had been fair, and there was strong government regulation protecting them and the environment.
The current government’s Fast-track process undermined both these things, Darby said.
“We’ve got the model wrong. And I don’t think this is going to end well for this government. It’s not going to end well for several governments.
“Fast-track is great if you want to do a deal. But I don’t think it’s going to create industries of renewable energy projects that are going to survive 20 or 30 years.”