Wednesday, 21 July 2010

Mine, mines, mining

You know, it’s great that Gerry Brownlee is still trying to keep the mining momentum rolling, but you’re probably wondering now why the government will now be spending up to five-million dollars of your money to undertake a “magnetic aerial survey in Northland and the West Coast, to explore for minerals.”

You’re probably asking yourself, “Isn’t this something on which private companies should be risking their own money?’ to which the answer is, of course, yes.

The reason, however, that it’s the government risking your money instead of a private company spending their own is that mineral rights in New Zealand are nationalised.  Owned by the government.  Just like it used to be in the Soviet Union.

Before the first Labour Government passed legislation in 1937 nationalising whatever mineral and petroleum resources might be found around New Zealand, ownership of that potential resource was determined by the common law, essentially giving rights to the resource to whomever discovered it and/or owned the space on which the resource lay—a great incentive to discover and exploit new resources. After 1937, however, any oil, gas, radioactive minerals, gold, silver, coal and all other metallic and non-metallic minerals and aggregates found anywhere in New Zealand belonged not to those who discovered and were prepared to exploit them, but by the government in perpetuity. Just like it used to be in the Soviet Union.

Which explains why the government is now using your money to pay for the magnetic aerial survey in Northland and the West Coast to explore for minerals, instead of a private company paying for it themselves. Just like it used to be in the Soviet Union.

Which as much as anything else also explains why Australians derives so much greater wealth from that country’s mineral resources than we do from this one’s, even though ours is nearly as much per-capita than theirs.

And which as much as anything else also explains why anything involved with mining in New Zealand is so heavily politicised, so hard to undertake, and puts the government in the position of both miner and environmental guardian. Just like it used to be in the Soviet Union.

Further reading:

1 comment:

  1. well that certainly explains why there is so little exploration in new zealand in general. Interesting that we live in a basically capitalist state where the public expect exploration to be run privately, yet the government continues to own all mineral rights, effectively stalling all economic development in the field, Environmental concerns or not.


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