Rt Hon John Key
Prime Minister
5 November 2012 Media Statement

Govt responds to Pike River Royal Commission
Prime Minister John Key today welcomed the report of the Royal Commission on the Pike River Coal Mine Tragedy.

“We owe it to the families of the 29 men who died to find out what happened and why, and a Royal Commission was the most appropriate form of inquiry.

“I speak on behalf of the Government when I say I regret deeply what has happened, in terms of the lives lost and suffering caused.

“The Royal Commission made it very clear that much of the fault for the tragedy lies with Pike River Coal Ltd. Because it did not follow good management and best practice principles, its health and safety systems were inadequate.

“However, the Royal Commission also says the regulatory environment was not effective over a long period of time.

“On behalf of the Government, I apologise to the families, friends and loved ones of the deceased men for the role this lack of regulatory effectiveness played in the tragedy.

“Following the findings of the Royal Commission, Labour Minister Kate Wilkinson has tendered her resignation from that portfolio.

“Ms Wilkinson’s decision to resign is a personal decision in response to the magnitude of the tragedy. It is the honourable thing to do.

I considered it proper for me to accept her resignation from the Labour portfolio.

“Ms Wilkinson retains her Ministerial warrant and other portfolios.”

Mr Key says the Royal Commission found the immediate cause of the tragedy was a large methane explosion.

“The most likely source of the methane was, to use the Royal Commission’s words, the void formed during mining of the first coal extraction in the mine. Alternatively, the source may have been methane that accumulated in the working areas of the mine.

“While the exact cause may not be known, the Royal Commission has found that this tragedy was preventable and that a combination of factors contributed to the terrible events of November 19, 2010.

“The first group of factors relates to Pike River Coal itself. And the second relates to the regulatory environment in which it operated,” says Mr Key.

“The Commission found there were multiple operational and systemic issues with Pike River Coal. The company had a history of over-promising and under-delivering. Coal production was years behind schedule, and a lack of money was driving the company to find further funding.

The business was new, and its systems, including those for health and safety, were in development.

“Pike River lost sight of its aim to be a productive and safe mine as the drive for production intensified.”

A second factor was the regulatory environment under which the Pike River Mine operated.

“Under successive governments, since 1992, the influence and reach of the mining inspectorate was eroded.

“The Commission found that while the Health and Safety in Employment Act appropriately placed primary responsibility for health and safety on the employer, this was seen by the Department of Labour as somehow reducing its responsibility to actively administer the legislation,” says Mr Key.

“The Royal Commission found the Department of Labour itself did not have the focus, capacity or strategies to ensure Pike was meeting its legal responsibilities under health and safety laws.”

Mr Key says the Government accepts there were systemic failures in the regulatory regime across successive governments.

“This meant that failures by Pike River Coal were not picked up and remedied as they should have been.
“The Royal Commission has made a total of 16 recommendations, covering administrative reform, stronger regulation, changes to mining legislation and emergency management,” says Mr Key.

“The Government will be broadly accepting those recommendations and will be working to implement them as quickly as possible.

“A small number require further investigation before they can be put in place; for example, the recommendation of the establishment of a new Crown entity focused on health and safety.

“Some will have an impact in relation to health and safety generally, and are not limited to underground mining.

“Detailed design and implementation issues will need to be worked through but the Government believes it is already on the path to putting these into action, including legislative and administrative changes, and through the work of the Independent Taskforce on Workplace Health and Safety.”

The report is available at: http://www.pikeriver.royalcommission.govt.nz.

ENDS

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Denniston Announcement: Coal Mine Gains Access Approval

Conservation Minister Dr Nick Smith today announced his approval under the Crown Minerals Act for an access agreement for Bathurst Resources for its Escarpment Mining Project on the Denniston Plateau, near Westport.

“This approval is for an open-cast mine on 106 hectares of the 2026 hectares that comprise the Denniston Plateau. This area is not National Park, nor Conservation Park nor does it have any particular reserve status...

“The loss of conservation values is compensated by a $22 million package by Bathurst Resources. This will fund pest and predator control over 25,000 hectares of the Heaphy River catchment in the Kahurangi National Park, 4,500 hectares on and around the Denniston Plateau, as well as for historic projects on the Plateau itself. This is More>>