Philippa Stevenson: Out of sight, out of mine

COMMENT

It will be goodbye Martha, hello Favona, if Waihi's proposed gold mine goes underground - and a few milestones will be set along the way.

The Waihi Gold Company, whose 16-year-old opencast gold and silver mine in the middle of the Hauraki town has crushed Martha Hill into dust and created a gargantuan pit, last week lodged resource consent applications for another mine near the town.

The proposed Favona mine, on 131ha of farmland 2km east of Waihi, couldn't be more different from the present operation that is due to close in 2007.

If, as seems likely, it goes ahead, it will be the only underground gold and silver mine in New Zealand, and the first mine in the Hauraki gold fields to pay royalties to the Government.

It will be the first solely underground mine in the district since the original Martha Mine closed 51 years ago.

Today's Martha mine operates on licences under the old Mines Act, which did not provide for royalties. Favona would be permitted under the Crown Minerals Act 1991 that does enable the country to get a return on its mineral deposits.

Waihi Gold, now known as Newmont Waihi after its parent company, Newmont Australia, will pay royalties of 1 per cent of the sale price of the gold and silver, or 5 per cent of the gross profit.

The Ministry of Economic Development has not forecast what the return in dollars might be but it is promising that Favona has a better gold-to-silver ratio than Martha.

In May, the company estimated that the valuable resource hidden beneath the hooves of grazing cattle would weigh in at about 1.8 million tonnes. Of that, 1.1 million tonnes contained gold at the rate of 10 grams per tonne, or 354,000 ounces, and silver at the rate of 36 grams per tonne, or 1.3 million ounces.

It expects to take six to 10 years, or to about 2017, to mine the deposit first tested 108 years ago.

In 1895, the Favona-Brilliant Gold Mining Company sank a 21m shaft to penetrate the Favona reef, but found little to encourage further exploration. Over the next 20 years the claim was taken over by a variety of companies but none produced any gold.

Waihi Gold proposes to use the existing Martha mine facilities such as its processing plant, water treatment facility and tailings dam for Favona. It suggests that as work reduces at Martha staff will be moved to the new operation, though fewer will be required.

Martha mineworkers, not including administration staff, have numbered around 163, and Favona would need between 60 and 100.

Favona would be a considerably smaller operation all together. Where Martha has churned through around 26,000 tonnes of waste rock and ore a day, or 80 million tonnes a year, Favona is expected to shift up to 1700 tonnes a day, or 4.6 million tonnes a year.

Where Martha used 136 trucks, Favona would have around 30.

Favona would operate 24 hours a day, seven days a week and the company expects the most noticeable effect to be vibrations from the twice-daily underground blasting.

While many Waihi people support mining, not least because of the wage packets that underscore the town's economy, the faith of a goodly number collapsed along with their homes when, in December 2001, caverns suddenly opened up in their backyards.

The earth gave way over old mine workings and no blame has been attributed to present mining.

But Waihi Gold, which owns most of the land under which it will mine, showed it remained sensitive to the issue.

It said progressive backfilling of the mined-out void would significantly remove the likelihood of subsidence like the collapse which occurred in Barry Rd in 2001 above the unfilled workings of the old Royal Lode. The consent hearings before the Hauraki District Council, Environment Waikato, the Ministry of Economic Development and the Historic Places Trust could be held by the end of the year, but even if the company gets an immediate go-ahead it is unlikely to start mining until at least 2005.

In the meantime, its exploration licence allows it to continue to examine the mineral deposits in a rather substantial fashion.

It has drilled test bores 300m deep but early next year it will start an 18-month project to construct an exploration decline, or a 5m-wide by 5m-high tunnel that will run for 1.2km underground. It will provide a close-up view of the mineral deposits.

If and when mining begins, the operation will be on a similar large scale, with 15 vehicles, including low-profile trucks, loaders and drilling machines beavering away underground to carry the rock to the surface.

Four-wheel-drive vehicles will transport staff below - a far cry from the ladders early miners clambered down into the depths of the old Martha pit.

Favona is unlikely to be the last attempt to wrest gold from the Hauraki field which is known to have at least 50 gold and silver veins.

The Favona vein is simply the easternmost portion of the field's Waihi system.

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