Media Release

Solid Energy releases first Environmental Report

13 December 2004

Coal producer, Solid Energy New Zealand Ltd, has today released its first Environmental Report, detailing the company's environmental activities and assessing its performance against its environmental objectives for the year ended 30 June 2004.

The report describes the company's environmental management system which it has introduced over the last two years to deliver its overall policy objective: "For the cumulative result of all the activities we undertake to have a positive net effect on the New Zealand environment."

Good progress was made during the year in rehabilitation plans and programmes for decommissioning sites at the end of their economic lives and at historical mines. Rehabilitation of the former Weaver's Opencast Mine, Huntly, is a significant success for Solid Energy. Around 30,000 trees have been planted, walking and biking tracks installed for public use over the last two years and more recently boat ramps and jetties for access to the 54-hectare lake at the heart of the new Weaver's Park. At Denniston, near Westport, considerable progress has been made clearing weeds and rubbish from around underground mines in the area. About 33,000 plants have been established in the year around the old Strongman underground mines, near Greymouth, and extensive work undertaken in managing the underground fire in the area.

Solid Energy is making a significant contribution to the expanding body of knowledge about the mining industry and its effects on the natural environment. The company is engaged in research which covers areas as diverse as the control of bacteria, critical to the production of acid mine drainage; the control of underground fires using grouting techniques; developing methods establishing colonising plants in the harsh sub-alpine environments of the South Island and the safe disposal of boron-rich ash from thermal power generation in the Waikato.

While there were no major environmental incidents in the year there were several consent breaches, and the company addressed a number of other incidents reported by staff and local residents, particularly in relation to water quality which remains one of its most significant environmental issues. There was one instance of enforcement action (an abatement notice) as a result of non-compliance.

Solid Energy Chief Executive Officer, Dr Don Elder, says the report is a significant landmark for the company as it openly details the environmental issues and challenges that the company faces in carrying out its mining operations and in tackling the legacy of historical mining practices.

"To demonstrate that we are a sustainable business, we have to produce our coal using best practice mining methods and with an overall positive effect on the New Zealand environment. While we have achieved improvements on many of our sites we still, at times, fall short of today's environmental best practice," Dr Elder says. "There are significant challenges ahead. But we now have a management system in place to carry through and deliver on our policy objectives, along with a system to monitor and measure our performance annually."

The measurement system assesses the company's environmental effects - ranging from impacts on plant and animal habitat to noise, dust and control of weeds and pests - relative to a "neutral" baseline (as if Solid Energy had not carried out any operations). The first assessment was carried out in 2003, by Solid Energy staff and expert consultants. In 2004, external organisations were also invited to participate including district and regional councils, Department of Conservation, local iwi and Fish and Game.

The cumulative net environmental effect of Solid Energy's operations on the environment has increased very slightly during the year, indicating that the company has fallen slightly short of its overall policy objective for the year, although the change is within the margin of error of the measurement system. Small improvements at several sites have been offset by an increase in the total size of our operations, mainly the disturbed areas of the sites.

Dr Elder says: "The value of the measurement process will become more apparent over a longer period. Although this system is primarily self assessment we will continue to apply the criteria rigorously. As well as providing a mechanism for measuring compliance with our environmental policy objectives and recording an environmental 'benchmark' for future reference, the survey process has raised awareness of environmental issues and impacts on our sites. We anticipate that with the continued emphasis on these issues, combined with our motivation to reduce our cumulative environmental impacts, that steady improvements will continue through to 2005 and beyond."

For further information contact, Vicki Blyth, Communications Director,Solid Energy New Zealand Ltd, Telephone 03 345 6000, Mobile 021 670 250.