Mission Man Tasked Hunting Down Cowboys Illegally Mining Gold in NZ

Gold Fever
41

We’ve got one at Waihi. It doesn’t give much of a return. Far better returns from tunneling at Karagahaki Gorge up the road, and all over the Coromandel.
It wouldn’t take much to reopen some of the mines shafts, with the profits they could fund better walking tracks - they can be very dire when it rains.

As for the petition.
It would be good to get some people to get signatures around their local community, and at the fossicking sites.
There could be a separate category for tourists - boost tourism & show that they would be willing to pay for a miners right too.
Ideally this could be done in the lead up to summer, and throughout summer.
Shouldn’t be too difficult if we all got out there, just carry the papers & pens, as you go about your usual business.

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42

Good point - probably give the petition a bit more weight.

43

yep. numbers are what will give the petition weight. just a pity we are a minority hobby. good idea taking it to the public sites to. ill definitely be signing it

44

It is a good plan you guys have. The only problem I have is that when NZP&M came out and asked for people’s ideas on the increase in fees, I posted it on the old site and asked everyone to write in and have there say. Well out of everyone who likes to b*tch and complain on here, and every person and company with a mineral permit in NZ, only 29 people wrote in to say ANYTHING. Good luck with your miners right petition. Nobody is gonna care about a few free loaders who want to find gold. We have public areas supplied by DOC for everyone to go have a pan. People could be willing to let others on there claim to have a pan, and you folks that have no claims could pay a small fee and have at it. It would save everyone a big Dick around. BUT, no one wants to pay, so no one wants to let someone go panning. Plan and simple

I put an offer out over winter for people to come down this summer and have a free feed and help me dredge, and fossick your hearts out, when we were not dredging. Out of all of you on this site, only a handful full said they were interested, and a hand full ditched out. You never had to pay anything, and you got free gold. So while you all think you are getting ripped off by the government, you are just to lazy and hard headed to pay someone to have a pan on there claim.

For years there has been people asking if someone, or a group wanted to share a claim, and no one can even get that together. The problem with gold is it brings out the greed in everyone. I have seen father and son split and never talk to each other, going on 10 years now.
As much as I would like the fees to come down for everyone, and people to be able to go have a pan anywhere. I don’t see it happening. The Government needs money, and big business. So the best way to make money, and get big business, is to lower taxes for big business, and pillage the locals.

Having worked in mineral exploration around the world, NZ is no different then anywhere else. The Klondyke, in Canada ONLY allows pans on the very few places you can public fossick. No sluice box, no dredge. Only when you hike thru the Bush, clearing a straight line, putting in claim posts, filling out paperwork, getting water rights approved, then are you able to start using anything more then a gold pan. And before you can even get a gram of gold you need to strip off 3 meters of muck to expose perma frost. Then… after waiting a YEAR for that to melt, can you start mining. So NZ doesn’t sound so bad anymore does it?

In the world today, if you want to dig a hole and find a ton of gold for free, head to Africa, Papa, or another 3rd world country where once you find your gold, you will be shot in the back of the head and life will carry on like nothing happened. Take your chance and go out and set up your sluice in a stream in NZ. Just don’t get to greedy and you may not get in trouble. Get greedy, fly in a dredge, and get huge fines. I am pretty sure that someone using hand tools is never going to end up with fines. Start playing like it’s a full time job and it will all turn to custard.

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45

Hi Goldstamp I agree worh some of your comments i have posted a few time regarding setting up a claim with a few others have done my homework and even found a few claims for sale started the process the oh nobody’s keen any more saying that i have also been offered to go on a few claims but they have been to far away to go for a weekend so I guess im just as bad . Also saying that i have written letters to claim holder and pm people and even leased a claim to run my dredge i am more than happy to pay for the privilege to pan and sluice on an existing claim im happy to pay a yearly fee or some arrangement

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46

Yep. I reckon it needs boots on the ground. Do a proper run of it. Explain the current situation, outlook for the future, and miners rights in the past.
Explain that a miners right would mean low no destructive fossicking, and non-detectable (you tidy up after you’re done, fill that hole). And no more destructive than what nature does over the course of a winter. Explain that this is about getting the rights back for the little New Zealander and retaining them in the face of big overseas corporations.

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47

Cough cough, splutter… GOLD is good.

Shady

.

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48

Gota agree with ya on what you’ve said Goldstamp. NZ actually has some of the easiest regulations and relatively low cost for claims out of alot of western countries. I spent some time in Canada and the US and it can turn very costly before your even firing up the dredge and that doesn’t take into consideration things like bears and the limited season they have over there before your frozen out.
The actual cost increase by nzpam putting up there fees is nominal as far as I’m concerned. Its like an extra half an oz of gold per year for hobby guys who in some instances are pulling out a couple of oz a weekend.

Gotta disagree with what’s been said about macreas not contributing. Last I checked the company pays tax in the form of company and employee tax to our economy as well as using a vast array of local service providers for things likes parts , repairs, transport , fuel , new capital acquisitions etc. Gold goes off shore big deal so does profits from alot of companies.

If anyone wants to pan or sluice on my claim give me a PM . Based in Otago.

Cheers

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49

Very kind to offer. I’m sure there will be some interest.

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50

You make some very good points there prich385 food for thought.

51

i sent a letter to nzpam no reply

52

You are right…Macraes DOES contribute BUT the fact you point out are infintisimal compared with the fact that the gold which should belong to New Zealand goes off shore and what do we get? A one percent royalty.
They tell us how marvellous it is for the local economy and that might be right BUT if it was a State owned mine then New Zealand would benefit three or four fold.
As for the profits from a lot if other companies there is no analogy because those companies with few exception are NOT taking an assett that should belong to the country. You cannot compare with say a foreign owned textile mill which buys wool in NZ turns it into produce and ships off shore or an offshore company that owns forestry in NZ and ships the product offshore. They have purchased the lease if the land or have purchased the trees.
The mining industry is a non renewable resource…New Zealanders should reap the benefit of all you list PLUS the gold and the value lies with the gold. Everything you list is a pee in a pond compared with the gold.

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53

Have to agree with that.
Currently New Zealand is in a very poor state.
We want our dollar to rise.
But when it does all our industry that supplies basic raw materials to the world suffers.
It would not be a problem if we packaged the milk powders & fruit here.
If we used our precious metals here.

We sell our coal to be burnt, now there is a world glut and it’s worthless.
But coal is an amazing versatile product, we should be making carbon fibre, carbon filters etc all here in our country, create a factory here and there (certainly got enough cheap hydropower to run it - and enough cheap immigrant/tourist labour).

54

A couple of points:

  1. not sure what your definition of infinitesimal is however in 2010 Macreas produced approx 400 million dollars worth of gold. It spent approx $150 million in direct expenditure ( fuel, repairs, sub contracting, capital acquisitions etc), approx $50 million in direct wages, paid approx $6 million in royalties , approx $63 million in company tax and returned a dividend to investors. It also paid approx another $50 million in indirect employment ( suppliers, sub contracting staff, etc)
    Coupled with the above is the other benefits such as creating high tech jobs and process which helps diversify the economy and support other industries to invest in new equipment and production techniques thereby making those businesses more efficient and competitive. I could go on but im not.
  2. You point point out if Macreas were to be state owned- Are you advocating full state owned ownership or partial?
    Full ownership would have its disadvantages and that would be the reduction in foreign capital into the country and the message it sends to overseas investors. There is also the argument of weather a government is the best entity to run a business especially considering the purpose of politicians is to win another term in government. This can result in governments making business decisions that are in the interests of them politically but not in the best interests of the business.
    Partial ownership can work and a classic example of this is companies like Air New Zealand who are extremely innovative but also very profitable and return good dividends to the government and its shareholders.
    State ownership of resources can work if setup right and a really good example of this is Norway and the large oil reserves they own and manage which results in massive amounts of money being used to invest in the country and outside. However this is an extremely long term investment strategy for them.
  3. You say or rather imply NZ should reap the benefits of the gold by way of state ownership. If this were to happen a considerable amount of money would be needed to setup a gold mine( exploration, drilling, building infrastructure, equipment, processing, restoration of land etc). Mines are capital intensive and that return on capital is not realized for a considerable period of time the mine is operational.Having worked in the resource industry in Australia and Africa profit is not actually realized until the twilight years of a mine. Gold is also a commodity that fluctuates and while the price is good at the moment it could reduce further.
    I would therefore argue that the money is better spent on investing in other industries or area that pose less of a risk. The high tech, tourism and technology sectors comes to mind if one diversifies.
    Leave the mining to outside of government sourced capital.

Another point raised by Goldpandemic re coal and the other versatile products it producers needs to be examined. Carbon fiber is made from pitch compounds such as gas and bituminous oils. The technology to make pitch from coal has not be commercially realized yet although research in this area continues. The production of carbon filters is usually made with wood products ( activated carbon) something NZ has in abundance.
The reality with coal is that as the world moves towards a lower carbon economy ( and it is) coal will become less and less favorable due to its environmental footprint and the fact better and more efficient power sources are developed and refined.

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55

So sll I shall say is this that apparently YOU support taking a very valuable non renewable mineral asset which is more stable and desirable than paper money that should belong to the citizens of New Zealand and and allow it to go offshore into the hands of the International bankers.
You can quote figures until the ciws come home but if the mine was State owned then the employment and expenditure you so knowledgably quote would still be the same BUT the gold itself would belong to the State which in turn would have a commodity which it could use as a kever against financial colkapse…he who holds the mineral wealth holds the purse strings.
You said that the price of gold is good at the moment…is that why I have been oeeved off over the last while…my net worth has collapsed compared with what it was. I KNOW that you are not right there…in fact I can get 1 kg if gold for nearly $10,000 less than it would have cost me five months or so ago. A topic I was discussing only today with a major Auckland bullion dealer with whom I deal.
Just saying.

56

Of course I support allowing a valuable asset to go off shore. I do it all the time when I sell my gold to my Gold Buyer and get cold hard cash for my hard work. I dont have a claim and 4 dredges just to sit around and look at my gold after I’ve painstakingly removed it from the Earth. I couldn’t care less if it ends up in the hands of an international banker. In fact I advocate to my gold buyer to ensure my gold I sell them is given to ethical international bankers that invest that gold into sustainable and developing communities, countries and businesses which means that I receive a slightly lower price for my gold. Im prepared to do that because I’ve lived,breathed and worked in impoverished worn torn countries where people need a hand up not a hand out. I put my money where my mouth is

Your second point where you state " he who holds the mineral wealth holds the purse strings" needs to be examined. Id agree with that statement if we lived 50 or more years ago. Fortunately or unfortunately (depending on your view point) that statement does not hold as much weight as it once did. The reason why is we live in an economy that is undergoing massive changes due to globalization and the liberalization of ours and others economies. Also the way we do business has drastically changed and continues to change. The real wealth is not in material things so much but in things like working capital, intellectual property, ideas, concepts and value added products. Don’t get me wrong there is still value in raw materials just there is more value in what you do with those materials and the ideas, concepts and expertise in labour to create new more innovative products for consumers.

I did say the price of gold is good at the moment and ill qualify that statement further. The price is good compared to what it was 10-15 years ago. Your statement around the fact gold has gone down over the last five months is immaterial to the price gold has gone up in the last 10-15 years. I therefore stand by my statement that the gold price is good.

Regards

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57

You missed the point one hundred percent…firstly congratulations on having four dredges!
Now heres the point - You sell your gold to an International Bullion dealer…marvellous…BUT THE VALUE OF THAT GOLD STAYS HERE…whereas the value of the Macraes gold goes off shore…New Zealand gets a ONE PERCENT royalty!
In your initial statement you never gave a benchmark against which to value gold in comparison with today and your comparison is flawed as gold price in 2012 was $1664 US. In other words the gold price today is rubbish! Ten years ago? Who are you trying to kid.
As for gold not being the best form of investment - tell that to all the Chinese and Indians who buy it hand over fist! I have a funny idea they might laugh at you.

58

The problem is your point is flawed. The value of my gold I sell indeed stays with me and your right the value of gold Macreas sells does indeed go offshore. However that only tells half the story. My reasoning as above points out that actually alot of that value of gold Macreas sells actually stays in NZ by way of taxes, wages, capital expenditure etc. I’ve given a high level breakdown of the figures in post 54 above. Therefore I disagree whereby you state " New Zealand only gets a one percent royalty!"
Ill leave that to you to form a rebuttal to that. Myself and the wider community would be interested to hear your thoughts.

You might want to re read my last post as you have made a critical error in your math. The gold price 10-15 years ago would be in the 2002 - 2007 range not 2012 as you have stated above.If you look at the 2002 and 2007 gold price it is approx $342 and $836 per oz.

I agree with you that the Chinese buy up large amounts of gold in fact about about 14% of their investments is in metals namely gold, platinum, rare earths, iron etc, However the amount invested in gold by the Chinese is paled by other sectors such as energy and power, infrastructure, technology, transport and finance.
My debate is not over the merits of gold as an investment but in relation to your statement in post 55 whereby you state “he who holds the mineral wealth holds the purse strings” . I’ve outlined in my reply post that this statement needs to be examined along with my thoughts.Ill leave it you to form counter argument should you wish.

Many Regards

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59

Whose reasoning is flawed…it is not mine because YES there are the taxes, the wages, the service industruies and suppliers and contractors and local economy all getting paid but that is nothing.
They are getting paid by the company to produce THE REAL VALUE, the gold and THAT goes offshore.
If a New Zealand company owned the mine then the benefit to the employees and all associated industries, wages, taxes etc is the same though that money is also local (NZ) money and not foreign money coming into the country to pay BUT the REAL VALUE is the gold and thetefire it should stay here. At the end of the day finances can collapse over night but he who holds the gold holds security against financial collapse.
In any case put it this way…foreign Mining company brings in X dollars to develop a mine, pay wages, help local economy, support Industry, contractors and suppliers but take out of the country gold to the value of 2X then we have lost 1X value in the form of a commodity that is of more benefit than any paper money…in other words that gold should stay.
If the government owned the mine then they might lose the taxes but the same amount goes to wages, industry, contractors, local economy etc, say .75X dollars (minus taxes) and the State gets the gold value 2X dollars.
It certainly is a no brainer - the gold should stay - in todays world its the gold that is security.
Have you any idea who gets that gold? The same people more or less who have already holding nearly 7000 ton of gold already.
At the end of the day that physical gold, now over 4 MILLION troy ounces mined at Macraes alone is worth far more $5,003,600,000 US to be precise and that us MANY times the money that has come into the country to pay wages, local economy, industry, taxes etc.
You argument sure is flawed - New Zealand should RETAIN THE GOLD.

60

Thanks for your reply im glad you are starting to come around to my reasoning whereby in previous posts you stated That Macreas contribution is " infinitesimal" in post 52 and also in post 54 whereby you also state “NZ only gets a one percent royalty” . I see you have acknowledged that there is some great economic benefits it has produced.

However I do wish to challenge you further on your logic in your latest post 59 whereby and please forgive me if I summarize your position but essentially what your saying is that all the profits Macreas makes (by way of selling the gold it extracts minus expenses) goes out of NZ and if it were state owned it would retain these profits. In order to tackle this ive created a summary of profits and losses for Macreas stretching back 12 years. This data is freely and easily available to the public.It is presented below:

2004 -loss of $47 million
2005 -profit of $14 million
2006 - loss of $23 million
2007 - loss of $69 million
2008 -loss of $30 million
2009 -profit of $38 million
2010 - profit of $29 million
2011 - profit of $30 million
2012 - profit of $14 million
2013 -loss of $33 million
2014 -profit of $83 million
2015 -profit of $28 million
2016 -profit of $63 million
Total for 12 years of operation = profit of $97 million or average of $8 million per year.

As you can see the average profit for Macreas over the last 12 years is $8 million dollars after tax per year.
When you compare it to the revenue Macreas makes the actual profit margin is low. An example of this is in year 2010 Macreas made approx $400 million in revenue but only made a profit of $29 million. That is a 7.25% profit margin! You’d get a better return selling lemonade down at the farmers market!
My point is the costs of operating developing and operating a mine like Macreas is huge and the money spent makes its way directly and indirectly back into the NZ economy.
Your argument that if Macreas were state owned the profits would stay in NZ. While this is true it only tells half the story and doesn’t address my rebuttal to this point in post 54. It also doesn’t address my question to you and and that is are you advocating partial or full state ownership? I state that governments are sometimes not good administrators of business as business decisions can be made based on political interests (the desire to gain another term in office etc) and not in the interests of the business. The other issue is politicians are generally good at trying to win another term in government but that doesn’t make them good business people.

My other point is that mines require huge amounts of capital to setup and operate. If this is provided by way of government ownership then tax payers foot the bill. The actual return on your investment is quite small as you can see above by the profits I have supplied for the last 12 years (note prior year results where not the most favorable as the gold price and production were low). My point on this is I believe the money is better spent on other areas which show a better return on investment and the development of value added products and services. A great example of this is the governments of countries like UAE and Qatar investing huge amounts of money in tourism and infrastructure projects which bring in foreign money by way of tourism, financial services, construction expertise etc. You only need to look at how Dubai is now a air travel hub in its own right bringing in huge amounts of money into a country whereby the citizens actually pay no PAYE tax.

My final point is risk- If Macreas were state owned then the risk to the business is with the government. I stated gold prices have been good relative to what they were 10-15 years ago. If gold prices had not been elevated and had instead been depressed then the there would be even less profit or maybe a loss that the government would have to cover. The other thing is in order for a company like Macreas to remain profitable it needs to hedge its risk and reduce its costs. This is done that by way of acquisitions and also by scaling up on other mining operations around the world. This has the effect on reducing costs like procurement of equipment etc. If the company were state owned then in order for it to remain competitive it would have to diversify its operations and with that comes more risk.And since where almost there on risk, another factor to take into consideration is mines like Macreas only have a finite resource and will eventually run out. No matter how much drilling and exploration work you do there is still the risk that the resource is not as good as what you thought it would be.

Mining is best left to the experts like Oceanagold who operates Macreas which still produce an excellent return to the country but without the risk of being state owned. I think there is other more profitable industries to invest public money in and create long term sustainable return on capital for the people of NZ.

Many Regards

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