Pike River Mine Inquiry Phase one round-up

Phase one of the Royal Commission of Inquiry into the Pike River Mine disaster has finished, and the evidence alleges serious inadequacies in the mine's conception.

White Knight Bridge, photo Iain McGregor/The Press

After seven months of silence, Pike River Coal chief executive Peter Whittall found his voice again. Reminiscent of those terrible days after the mine blew up, when he fronted to desperate families and a shocked nation with detailed, authoritative updates, he was back on unflappable form as he delivered his brief of evidence to the Royal Commission of Inquiry.

There were elaborate explanations about continuous miners and guzzlers, about the length of roof bolts and the weight of roadheaders, about the distance probed by in-seam drill holes and the number of computer monitors in the control room.

But about many of the things that mattered most to the families of the 29 lost men, he seemed to know little. He didn’t know what supplies were kept at the fresh-air base that was supposed to be the mine’s safe haven in an emergency, and he didn’t know how many men it could accommodate. He couldn’t recall if there had ever been a trial to see if workers wearing self-rescue kit could climb the 108m ladder up the vertical ventilation shaft – the only route to the surface if the main tunnel was impassable. He was unaware of reports from the mine’s gas drainage consultant warning of inadequate infrastructure to drain methane from the coal seam to the surface, and which referred to “high-level risk” to workers. He didn’t know how many of the mine’s gas sensors were working at the time of the explosion.

He deflected responsibility for many such matters to his mine manager and other members of Pike’s senior management team.

After ploughing $350 million into development – five times more than the predicted cost when the project was given the go-ahead in 2005 by Pike’s promoter and major shareholder, NZ Oil and Gas (NZOG) – the mine was just starting to get into production by the time of the November 19 explosion. In the weeks before, a large new underground ventilation fan had started operating, after a difficult commissioning in which it had repeatedly tripped out. Mining with the use of the hydro-monitor, a high-pressure water jet that carves coal from the seam and which has the potential to release large volumes of methane, had begun in September.

The commission heard at length about the absence of significant mine infrastructure at the time of the disaster, and in particular the long-planned emergency exit that was to have been located towards the west of the mine but was never built. A tube bundle gas-monitoring system, regarded as a vital gas management tool in modern mines, had not been installed; nor had a planned second underground ventilation fan.

But in the search for the root cause of the calamity, the commission was invited to consider the basis upon which the mine was conceived. “Fundamentally, this is all about the geology,” said Don Elder, chief executive of Solid Energy, the only company of significant scale with a history of underground coal mining on the West Coast. He alleged Pike had inadequate knowledge of its coal seam, and that its plans had been endorsed by offshore consultants who likewise failed to understand the West Coast’s complex geology. The feasibility study on which the Pike project was based had relied on only 5-10% of the amount of exploratory drilling that Solid Energy would have required.

On the basis of this scanty data, it had conceived a “hugely aspirational” production target of 1.3 million tonnes of coal a year – eight times more than the average output of Spring Creek, Solid Energy’s underground mine to the west of Pike.

Geologist Jane Newman, who has studied the Pike coal seam over 30 years, also told of her concern at Pike’s “sketchy” geological data. She had offered her services to the project early on – when NZOG took over the Pike mining licence in 1988, she visited the company’s Wellington office to tell them of the studies she had done over the years and suggest they form a co-operative relationship. NZOG representatives said they weren’t interested in talking to her.

Later, when Pike’s in-house geologist became concerned about the complexities they were encountering, she was asked to develop a model to help them understand the geological layers beneath the surface. But Pike’s technical staff seemed unable to get the ear of senior management and a second phase of work to test the model never took place, limiting its usefulness. Newman also offered to train Pike staff in West Coast coal geology, but they were too busy.

By 2009, she decided she should distance herself from the company. The following year, when her husband, a geochemist, told her he was going to the West Coast to do some work for Pike, she told him she didn’t want him to go into the mine; she felt “things were converging on a situation that I wasn’t happy about”.

Harry Bell, a former chief inspector of coal mines, also had grave concerns. He told the commission that in 2006 he had been asked by Pike to take non-representative samples from the seam, avoiding the top layer of the coal, which was high in sulphur and therefore unsuitable for steel-making. He was told of plans to mine only the high-quality coal further down, but he felt it would be extremely difficult and expensive to do this without contaminating the good coal with the high-sulphur material. He thought the approach Pike was taking to mine development was so doubtful he warned off friends who were considering investing in the company’s public float in 2007.

In 2008, during a seven-month period as a supervisor on the tunnel construction, he told the company its plan to push just a single drive through the potentially gassy Hawera fault was flawed, and that its ventilation system was inadequate. Later that year, he was furious to learn of 10 ignitions in the tunnel, and demanded – unsuccessfully – the mines inspector put a stop to work until ventilation was improved.

The inquiry heard that by the time of the explosion, Pike had had six different mine managers in two years, three operations managers in 18 months and five technical managers in five years.

Whittall, who had left a long career with BHP in Australia to develop the mine – starting out in 2005, as he noted, with nothing more than “a mountainside … and a feasibility study” – had been promoted to chief executive six weeks earlier. Gordon Ward, the previous chief executive, had resigned and abruptly left the company’s Wellington head office in September.

The mine was still a long way from full production, and was facing a cash shortfall of $54 million. Whittall’s first task as chief executive had been to go to the financial markets for a fifth time and raise $70 million in new capital – a deal that was to have been announced the week after the explosion.

But he told the commission these financial pressures were of no consequence to what went on at the coal face. Production delays and cash-flow difficulties were “lamentable”, “but they’re business issues … to my knowledge there’s never been any indication or insinuation that that should impact on the safe operation of mining”.

Whittall stood outside the Greymouth courtroom at the end of the hearings and told reporters Pike’s reputation was “untarnished … The company from day one has always had safety at the forefront of its way of operating.” That perspective will undoubtedly come under fierce scrutiny in future phases of the inquiry.

The Listener’s day-by-day coverage of the Pike River Coal disaster here.