Quarrying & Mining Magazine

TTR stalled over legal interpretation of compliance monitoring

Last month Trans-Tasman Resources (TTR) was reviewing its Queen’s Counsel’s detailed assessment of the High Court ruling in late August over its mining plans off the Taranaki Coast.

A DISAPPOINTED TTR IS considering its options before being able to comment further.

A year ago, in August 2017, the Environmental Protection Authority (EPA) granted TTR consent to mine up to 50 million tonnes of iron sand from a 66 square kilometre area off the South Taranaki Bight for a period of 35 years. This followed a split decision among the EPA decision-making committee (DMC) and a ‘casting vote’ used in favour of TTR’s consent.

This decision was appealed in the High Court by 11 anti-mining groups, which ended up at a hearing in the Wellington High Court back in April under Justice Peter Churchman. The judge then reserved his decision, which was finally released last month in favour of the environmentalists over just one of the eight different grounds of appeal.

This was over the legal ‘interpretation’ of compliance monitoring within the EPA consent and specifically, what was “adaptive management”, and was the DMC’s interpretation of what amounted to an adaptive management approach too narrow?

The court ruled that the DMC’s consent conditions were, or contributed to, an “adaptive management approach”, that is not permitted in an area governed by the Exclusive Economic Zone Act.

Adaptive management is allowing an activity with uncertain effects and then continually assessing it and any unanticipated effects managed by changing or stopping the activity. 

The judge ruled that this ‘interpretation’ was inconsistent with the purpose of the EEZ Act in protecting the environment, and its obligation to favour caution and environmental protection if the information available (in the consent) was inadequate.

The court says any ‘incorrect interpretation’ of the legal terms around protecting the ocean environment “may well have influenced” the outcome of the seabed mining consent.

Effectively, the appeal was allowed over this one point, and the decision of the EPA’s DMC quashed, and the matter referred back to the EPA committee for reconsideration in applying the correct legal test in relation to the concept of ‘adaptive management’.

TTR now has the option of the Court of Appeal and the Supreme Court. A similar story happened with Bathurst Resources over coal consenting, and it eventually won its case in the Supreme Court, albeit at great cost.

“It should be acknowledged that TTR has undertaken extensive marine environmental work in the STB and as a result of TTR’s research, the STB is now regarded as the most studied and documented area of ocean floor and marine environment around New Zealand.”

– Alan Eggers, TTR chairman

A long project saga

New Zealand based and managed, TTR was specifically set up in 2007 to explore and develop our offshore mineral sand deposits.

By 2016 TTR’s most advanced project was the South Taranaki Bight (STB) iron sands project located up to 36 kilometres offshore from Patea.

The STB project is based on dredging 50 million tonnes of iron sand a year; separating around 10 percent titano-magnetite from the sediment offshore; and returning 90 percent of the sand to the seabed backfilling mined areas.

Since inception the company says it has spent more than $80 million on defining the resource potential and possible impacts of the mining associated with the STB, which it says will add significantly to the diversification of the Taranaki economy and national export coffers.

TTRs’ first application to mine iron sands was turned down by the EPA in June 2014 by the EPA DMC, over uncertainty of the environmental effects.

It should be noted that TTR was granted a Prospecting Permit in the same year under the Crown Minerals Act 1991, to prospect potentially high-grade heavy mineral sand deposits offshore off the West Coast of the South Island containing ilmenite, zircon, rutile, garnet and gold similar to the onshore Barrytown deposit.

On 23 August 2016, TTR lodged a second South Taranaki Bight (STB) application with the EPA, and the hearings started in February 2017 in Wellington, and after 27 days of hearings, including four days in New Plymouth, closed at the end of May last year.

TTR said it understood the time needed for the DMC to deliver the decision was not without precedent, and reflected the need to document fully their reasons for the decision, and deal fairly with an unusually high number of public submissions on a wide range of complex issues. 

“It should be acknowledged that TTR has undertaken extensive marine environmental work in the STB and as a result of TTR’s research, the STB is now regarded as the most studied and documented area of ocean floor and marine environment around New Zealand,” it said. 

TTR was confident it had done everything necessary for the EPA’s DMC to make an ‘informed’ decision in its favour.

Alan Eggers, TTR chairman

“We are confident we have done the hard work, but we respect them and are not trying to pre-empt their decision,” TTR chairman Alan Eggers told Q&M towards the end of the Wellington EPA hearing in late February 2017.

At that stage, TTR, which is about 45 percent foreign-owned, hoped to start offshore mining operations in 2020, assuming it got the EPA consents.

Eggers, a fifth generation Kiwi with decades of international mining experience, told this magazine at the time that, since 2014, the company had completed more scientific and engineering work, more stakeholder engagement, and further analysis that clearly showed the economic benefits of the development of its proposed STB iron sands project.

These benefits include the employment of over 220 staff and export earnings of about US$400 million per year. Developing the STB resource will also be “a significant opportunity for New Zealand”, said Eggers, and could see this country become “a global leader” in marine mining.

TTR won its second EPA application, and approval was granted in August of  2017 with over 100 conditions imposed, including a two-year monitoring plan before mining could take place. It was the first approval for a mining proposal in our extensive offshore Exclusive Economic Zone under the EEZ Act 2012.

Straterra chief executive, Chris Baker, said the decision sent a strong signal to those looking to invest in the extractive sector that New Zealand is open for business.

“Proposals must be supported by data and analysis that meets the high standards we expect, and the DMC’s rigorous and exhaustive process and subsequent decision is a very positive outcome,” he said, stressing that under the EEZ Act, under which the decision was made, the DMC had been particularly cautious when it came to uncertainty.

“The Committee had to satisfy itself, on best available information, that effects can be well managed.“

Alan Eggers believed at the time it was the final regulatory hurdle the company needed to clear before starting building, commissioning and operating seabed mining.

Then High Court appeals by nine protestor groups, including Greenpeace and Forest and Bird, were due to be heard in April 2018,  and limited to questions of law challenging the DMC’s granting of consent under the EEZ Act.

Eggers described these appeals as “disappointing” and said they would result in  delays in getting the BFS project completed.  As a High Court decision was unlikely to be made until later this year, and given it will take about three years to complete the BFS, construct and then commission the STB project, he anticipated the first iron ore export shipments to start in 2021.

“Our legal advisers [environmental and public law specialists Atkins Holm Majurey of Auckland] consider the appeals do not raise or specify significant errors of law or points of law that are particularly compelling that would put the grant of the marine consent at serious risk,” he said at the time.

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