All of Govt’s 2024 coal earnings spent treating damages at a single mine

New Treasury figures show last year the Government spent more than $3 million treating damage caused by coal mining at a single site on the West Coast – more than it collected in royalties for all coal mining nationwide the same year.
The Stockton mine is the country’s largest open-cast coal operation, and a fast-track listing would see its licence continue for another 25 years. Remediation efforts for historical mining are still underway. 
Despite efforts by the mine’s operators to restore the health of nearby waterways, acid mine drainage poses a lingering and considerable threat to the freshwater ecosystems. According to the company’s annual report, DNA data appears to show “spectacular recovery” in nearby waterways. But publicly collected data from the surrounding area paints a different picture.
When state-owned Solid Energy folded in 2017, the Crown picked up all its liabilities – to the tune of more than $150m. The mining operation had found itself $400m in the red, meaning over a third of this was due to remediation costs. And $57m of those remediation costs came from Stockton alone.
BT Mining Ltd (65 percent of which is owned by Bathurst, New Zealand’s largest coal exporter) now administers the Stockton site and is responsible for remediation of past and future acid mine drainage. Bathurst has lodged a bond with the Treasury to cover future liabilities, but any costs to remediate pre-2017 acid mine drainage are picked up by the taxpayer. Newsroom approached Bathurst and industry group Straterra, but neither responded in time for publication.
Acid mine drainage remediation is one such cost. When acidic water drains from coal or metal mines, or from the waste ponds they create, it can decimate organic communities living downstream. It is the most common water quality issue on the West Coast, according to Te Tai o Poutini Plan.
According to information released under the Official Information Act, this costs more than $3m a year. In 2023 it was $3.13m, and $3.67m in 2024.
Meanwhile, annual minerals industry statistics released on Friday show these costs are on average the same, if not more, than the average the Government collects in royalties from the entire coal mining industry in a year.
In the 2023/24 financial year, the Government collected $3.7m in revenue from the coal industry, in 2021/22 it was $2.96m, and in 2020/21 it was $1.5m. However, in the 2022/23 financial year, the Government received $7.49m in royalties from all coal mining in New Zealand. The reason for this boost was a temporary spike in the price of coking coal in early 2022.
Bathurst reported $213m in export sales in the 2024 financial year, and internal reports said the company spent around $85 million on wages and $240 million on equipment, fuel and other practical expenses.
With the release of the minerals industry survey data published by MBIE, Resources Minister Shane Jones said the figures did not yet reflect the coalition Government’s policies to expand the mining sector, but “it demonstrates a sector that continues to deliver for New Zealanders by driving regional economic activity and contributing royalties that ultimately help fund necessities such as transport, education and healthcare”.
Bathurst is often the largest employer in the communities it operates in – another concern the company listed in its annual report, as the wind-down period of any mine has a considerable impact on the community it has been supporting. 
The same annual reports explained how the company is mitigating the effects of acid mine drainage. In its 2023 report, the company said it was using calcium oxide (lime) to offset the acidic properties of nearby waterways, mostly due to historic mining. That year, acid mine drainage rates dropped 10 percent at the site.
But at the same time, the company reported “increased stripping volumes” at Stockton. A targeted coal deposit was overlaid by 4.8 million cubic metres of potentially acid-forming rock, all of which was extracted. Stockton was the only Bathurst mine in 2023 to report disturbing potentially acid-forming waste rock.
This trend continued in 2024, with 5.3 million more cubic metres of potentially acidic rock removed – again, Stockton was the only one of Bathurst’s mines to report any. The report noted any such material was “managed in carefully placed engineered landforms”.
But also in 2024, the company announced a potential switch of treatment. Instead of lime, it was now looking at magnesium oxide (magnesia), which reportedly reduced the volume of waste sludge removed from rivers by a factor of eight. 
According to Treasury’s annual report, the cost of lime is the biggest factor on the long-term cost of rehabilitation, with inflation. The cost to treat one tonne of acid increased by 2.8 percent for 2025, with 2023’s modelling projecting a 22.2 percent increase into the future. The report noted a 10 percent increase in this cost above the projected value would increase margin by $7.2 million, all of which would be reimbursed to Bathurst.
The company rehabilitated 25 hectares of land at the site, meeting its target for the year. The total area remaining for rehabilitation is more than 850 hectares, but future annual targets were set at 150 hectares per year.
In 2023, Bathurst included in its annual report the results of an environmental DNA study in the surrounding waters. These tests sample water for traces of upstream DNA, offering insight into what plants and animals are in the ecosystem. Healthy freshwater systems are typically identified by lots of insects.
Bathurst displayed a “tree of life” diagram for Rapid Creek, which runs through the downstream community of Waimangaroa. It displayed a smattering of insects, fish and other life, including the “astonishing” results of kōrua, inanga and tuna, which the company pointed to as indicators that the area was healing from the damage caused by historic acid mine drainage. 
The company said it planned to use such surveys as a way to establish a baseline for affected areas and monitor river health over time, and that “eDNA monitoring is shaping up to be a tool of choice” for such work. 
But a public sample of the same creek, also in 2023, offered a different view.
This sample recorded not a single species of freshwater insect, an absence that freshwater ecologist Dr Mike Joy said was “pretty strong evidence of a massive impact, of something going on”. 
Joy told Newsroom this was unusual: “Even in a shocking situation, you’ll still get things like rat-tailed maggots and stuff that will survive,” he said. The biodiversity recorded in a river rated as “pristine”, not far from the Stockton mine, is apparent. The community shows a wider range of insects, fungi, fish and bird life, in proportions not seen in the downstream sites. 
Joy tried to explain why the two samples could have shown different results from the same site. One one hand, there could have been an issue with the sample itself: it could have been taken during a high-seepage period or a different time of year that would have affected which community of organisms was present, or it could’ve been faulty. 
But on the other hand, it picked up the same fish and mammal species as the Bathurst test. DNA from these animals was probably washing in from onshore or upstream, and the fact it was consistent across both tests gave Joy more confidence in its results.
Just because fish or eels showed up on a DNA survey didn’t mean they were actually living in the polluted river, Joy said.
“If there’s fish, they’ll be upstream in some tributary away from the impact,” said Joy. Their DNA could flow down the river and still be captured in the survey.
“No natural system” would lack an insect community, he said.
Meanwhile, a sample collected in the heart of the historic Stockton mining area couldn’t identify enough life forms to generate a tree of life diagram. A further sample, on the nearby historic Denniston coal mining site, registered a single insect species and no fish. 
Even if the remediation effects were successful, Joy said the ecosystem still had a persistent threat: the “carefully placed engineered landforms” in which Bathurst stored hazardous waste.
These tailings are packed away, “top, bottom and sides”, said Joy. But if water gets in there at any stage, Joy warned it would be disastrous for the local ecosystem, and with no end in sight. 
“It’s not even like uranium or nuclear waste that has a half life,” said Joy. “These tailings are dangerous forever.”