The Environmental Protection Authority (EPA)
has rejected a second application for deep sea mining under the
Exclusive Economic Zone and Continental Shelf (Environmental
Effects) Act 2012 (the EEZ Act).
The decision against Chatham Rock Phosphate
(CRP) this week follows the rejection in June last year of
a bid by Trans-Tasman Resources Ltd (TTR).
Both decisions demonstrate the precautionary approach
that the EPA is required to adopt in implementing the EEZ Act, and
the care that therefore needs to be taken when preparing projects
and applications for consent to mine within the EEZ.
CRP wanted to mine phosphorite nodules on the Chatham Rise; TTR
to extract offshore iron sand in the South Taranaki Bight.
Both applications were declined on the basis of a lack of
certainty about the environmental impacts and risks associated with
their proposals. The EPA found that both TTR and CRP had provided
the best available information on the nature and scale of the
effects of their respective projects.
But in both cases, significant information gaps and
uncertainties remained. Neither applicant could satisfy the
EPA's concerns with their proposed adaptive management
Careful and strategic advice should be taken on the scope of
applications, the nature and contents of the accompanying
environmental impact assessments and any draft conditions proposed
(especially any relating to adaptive management regimes).
The EEZ Act
The EEZ Act requires the EPA to favour caution and environmental
protection where there is uncertainty regarding the environmental
effects and risks of a proposal. But before declining a proposal on
grounds of uncertainty, the EPA must consider whether an adaptive
management approach would enable the application to be
The EPA has recognised that the scientific knowledge we have of
the EEZ is manifestly incomplete. While a complete and perfect
understanding of the EEZ environment is not required before consent
will be granted, applicants must still come to the EPA with enough
information about the environmental effects of their proposed
operations in order that the risks and impacts of the proposal can
be properly assessed.
Where to from here?
In the wake of the CRP decision, some members of the business
community have questioned what mining investor is going to be
prepared to lodge the third application for a deep sea mining
There were other reasons why the TTR and CRP applications were
refused. As well as failing to provide adequate information or
adaptive management conditions, TTR and CRP both failed to
demonstrate that their proposals could provide more than modest
economic benefit to New Zealand.
The EPA also had concerns in both cases about the impact on
groups such as iwi and the commercial fishing industry that had
existing interests in the area where the activities were proposed.
In addition, the potential environmental impact of both proposals
would be more than minor. It may be that an application which fares
better in these areas would be in with a better shot at
It is also worth mentioning that both TTR and CRP rejected the
suggestion that they should undertake a small scale trial of the
proposed mining activities, stating that would be unfeasible. In
the case of CRP in particular, the depth of mining and methods
proposed have never been carried out worldwide. It is possible that
a project which has international experience or can start with a
small scale trial would have a better chance of being granted
Both the CRP and TTR applications attracted a large number of
submissions from a diverse range of New Zealanders including iwi,
the commercial fishing industry, conservation groups, and
recreational users of the marine environment. The issue of deep sea
mining and how best to manage the resources in our exclusive
economic zone will continue to evoke a range of strong
The High Court has not yet had a chance to consider the
provisions of the EEZ Act. TTR has recently abandoned its appeal to
the High Court and it remains to be seen whether CRP will attempt
an appeal, submit a new application, or walk away.
The information in this article is for informative purposes
only and should not be relied on as legal advice. Please contact
Chapman Tripp for advice tailored to your situation.
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