As in
other countries, gold mining inNew
Zealand has been cyclic in character. Looking
at these cycles may provide insights as to what may occur in the future and that
is the basis for this study.

New
Zealand
has experienced four gold mining cycles. The first began in 1857, peaked in 1866
and terminated in 1890. This cycle was characterised by alluvial gold mining by
individuals and small groups. This is referred to as the Labour Led
cycle.
The second cycle began in 1890 and reached its peak in
1906 and terminated in 1929. This cycle was characterised by the use of dredges
in alluvial gold mining and was also the peak of hard rock mining. This cycle is
referred to as the Technology Led Cycle.
The
third cycle peaked in 1940. This cycle was far less significant than the
previous cycles, arising out of the depression when the unemployed embarked on
small scale alluvial mining. This overprinted the continuing decline that
occurred after 1906. This cycle is here referred to as the Depression Overprint
Cycle.

The
fourth cycle began in 1984 when production began to climb rapidly from a very
low base. The growth in production was spurred by rising gold prices in the
early 1980s resulting in relatively low grade gold-bearing alluvial ground
becoming economic. But in the 1990s, production from the new hardrock mines in
Coromandel and Otago has overshadowed alluvial production. This cycle is here
referred to as the Price Led cycle.

What are the future prospects for gold in
New
Zealand? Although there are many factors
involved, this will be largely determined by two factors; firstly, continued
access to prospective gold-bearing properties, and secondly, the price of
gold.
Based on these factors, three future industry scenarios
have been developed. The first of these is industry collapse, in which access to
prospective property is constrained and prices mayor may not weaken. The second
is industry consolidation, in which the available ground is accumulated by a
small number of large companies who can use economies of scale to weather price
fluctuations. The third scenario is industry growth, in which access to
prospective ground is constrained in environmentally sensitive areas but is
otherwise relatively unconstrained. Efficient companies are allowed to work in a
policy and economic framework that allows them to make a major contribution to
the economy.

While the industry
cannot control these critical factors, a good knowledge of the positive role
gold mining could play in the future economy may provide a framework by which
the access issue, in particular, may be addressed from a balanced
perspective.