Chatham Rock Phosphate, whose marine consent application was rejected by the Environmental Protection Authority (EPA) last week, is regrouping, having gleaned more cash from shareholders and indicating it wants to persevere with its project.
While the EPA's decisions to disallow two separate seabed mining ventures appear to be a fait accompli, behind the scenes there is growing anticipation the Government will shortly change the rules in the direct favour of seabed mining.
However, any chances of changing the law by stealth disappeared this week, the Green Party and environmentalists having already criticised the amendment process.
Chatham has rejected any legal appeal to the EPA's decision as a ''pointless exercise'' in dealing with the same committee and is considering reapplying for a marine consent to mine 1.5 million tonnes of phosphate chips annually from the Chatham Rise seabed at depths down to 450m.
Chatham Rock, which has spent more than $33 million on the project so far, recently raised a further $245,000 from a small pool of well-heeled investors within its wider shareholder base.
Of its $1.9 million assets, Chatham had just $122,000 in cash and $400,000 in receivables owed, as at September, and is now in a self-described ''survival mode'' to remain solvent.
Chatham's managing director, Chris Castle, hinted last week the Government was moving toward amending the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012 (EEZ Act), which governs offshore mining and oil and gas exploration, to ease the way for seabed mining.
While the Government's proposed amendment this week is to allow the veteran Maui gas field to continue producing while it applies for the newly required marine consent, industry sources are hoping the Government will make amendments at select committee level to change the seabed rules.
In announcing Chatham's decision to consider a new application, Mr Castle pulled no punches in criticising the EPA ''decision-making committee'', labelling it ''confused'' and having a ''poor understanding'' of Chatham's proposals.
''Assuming we decide to undertake another application we will need to clarify, for a new decision-maker, the confused thinking of this committee on issues they identified as having too much uncertainty,'' he said.
In his lengthy release to the market, he claimed all the information required was provided, and every question was answered.
''[However] the committee simply didn't appear to understand it or otherwise believed it was less risky to decline the consent,'' he said.
One reason for declining the application was the presence of stony corals in the proposed mining area.
Mr Castle said Chatham acknowledged the corals may not appear in a thicket or community elsewhere.
''Our proposed mitigation was to avoid those thicket areas by excluding them from our mining plan but that was not accepted.''
Mr Castle said there were several instances where the committee found the scientific evidence ''insufficient'' and uncertain, findings which also occurred when the EPA turned down Trans-Tasman Resources' application to mine iron sand from Taranaki's seabed last year.
''The committee appeared to be unwilling or unable to understand the reality of working in New Zealand's oceans,'' he said.
Mr Castle said there would never be ''complete information'' and every environmental decision will have to accept ''some level of uncertainty''.
''This committees's decision has elevated the EEZ Act's information principles to a level which, for this project, is both unrealistic and unachievable,'' Mr Castle said.
