Resolution of illegal mining case delivers community benefit
A diversion agreement arising from an illegal gold mining operation has resulted in a constructive outcome for the community, the Crown and the operator involved.
In 2022, the Ministry of Business, Innovation and Employment (MBIE) filed charges in the Christchurch District Court against an individual who carried out gold mining activities under a permit that authorised exploration only, an offence under the Crown Minerals Act 1991.
"The vast majority of mining operators understand and meet their obligations, but as with any sector, there are occasional exceptions," says Phil Latimer, National Manager Compliance for New Zealand Petroleum and Minerals (NZP&M) within MBIE.
"An exploration permit allows an operator to investigate the potential viability of a mineral resource. It does not authorise commercial-scale mining activities."
NZP&M became aware of the offending during a compliance inspection, which identified large-scale opencast mining activities on the site.
"A subsequent investigation, including detailed geological analysis, found that a significant volume of material had been processed and gold recovered without the appropriate mining permit being in place," Mr Latimer says.
"The operator had also failed to pay the royalties owed on the gold extracted."
NZP&M is seeing growing interest in minerals exploration, and it is important that permit holders understand and comply with the conditions of their permits.
"We are a fair regulator committed to helping responsible operators get on with the job, but there is no place for cowboys in New Zealand's minerals sector,” says Mr Latimer.
"The integrity of the permitting system relies on operators complying with the conditions of their permits. Those who choose not to do so can expect regulatory action."
Mining activity ceased following NZP&M's intervention, and the defendant accepted responsibility for the offending. As part of an approved diversion agreement, the defendant agreed to repay outstanding royalties owed to the Crown and make a substantial donation to a local charity.
Diversion is a restorative process that enables eligible offenders to take responsibility for their actions, make amends and resolve matters outside the court system.
"This outcome ensures the Crown receives the royalties that were due, the local community benefits directly, and the operator has been held accountable for their actions," says Mr Latimer.
"It is also a timely reminder that NZP&M actively monitors compliance and will take action where operators fail to meet their obligations."