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Saturday, November 20, 2010

Was NZ’s Pike River coal mine disaster a blunder?

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I am terribly suspicious of the decisions made culminating in the recent UG coal mine disaster on the West Coast of NZ.
Firstly, I tend to think the company is doing the right thing in terms of the rescue.
I don't know the specifics of the mine layout, but I tend to think mine gas concentrations are going to be lowest immediately after an explosion. The problem is that the ventilation units are likely damaged, so pertinent points in the mine are not accessible until they can develop a drill hole vent to pump air through the desired area. It’s a long wait...but perhaps they will walk out in the meantime. Maybe the 39 miners are injured or trapped; hopefully not fatalities.
Secondly, I am suspicious of the decision-making prior to the accident.
The mine operators ought to have had communications in place. This might point to the fate of the miners, an unfortunate locating of communications, damages to the communications equipment (unlikely) or to a failure by the operator to install such safety measures. This is all speculation of course...better considered after the rescue is completed.
This is why a rescued miner may have pointed to the need for mine inspectors in NZ...as is common in other countries. NZ seems to learn from its disasters. The reality is that NZ has a very small coal mining industry, so perhaps this cost saving was imprudent given the risks involved in coal mining from coal gas explosion/ignition. Basically its easy for coal seam gas to explode at concentrations between 13-45%CH4 (if memory serves me).
If communications were in place and working, and the trapped workers conscious, this could have determined whether rescuers should enter.
I am suspicious because the Pike River Coal publicity machine is trumpeting the “caringness” of its CEO. Seldom is a mine accident the result of an uncaring CEO. More often its caused by CEOs & executives who can't/don't see around corners, i.e. anticipate the dangers, or who place safety after more tangible and immediate concerns like profitability or meeting budgets. This mine was failing to achieve profitability. Were short-cuts taken? Did they promote a ‘caring local’ guy over a competent 'outsider' in order to keep wages down? After all, the local guy was 'friends' with the workers. Suspicious. If I was a journalist, I would be looking at his prior mine experience. Seldom is a miner elevated to a CEO position. One has to ask why? Financial motives? The reason why I say this is because it’s a small mining community where workers can easily extort higher wages...a 'friendly' CEO is the obvious antidote if you care little about safety. Of course safety is not the sole consideration. The question is whether financial considerations were overwhelmingly the big issue. The absence of a mine inspectorate/regulator creates the perfect storm.
The problem as I see it is that no one wants to speak badly of a company when the govt is implicated (as regulator), i.e. Mine safety personal/consultants cannot expect a job in the future if they start criticising company policy. Lax govt regulation is the likely culprit....though unions too could have done more as custodians of worker's interests. Govts are useless regulators..well useless at everything..Why we pay taxes??

Is the Keys government or NZ Oil & Gas (i.e. the largest shareholder in Pike River Coal) to blame? Hard to say..though if I was a journalist, I would be doing a lot of sniffing around whilst the workers are underground. It is not my intent to implicate the company, unions or others. I am developing a scenario. It does need more empirical evidence. I also tend to think companies have a lot of unreasonable burdens placed upon them, and it is middlemen like govt and unions which tend to precipitate these problems. These two agents extort money from people through coercion. They force companies and workers to do things which they would not otherwise do. If the government is to blame, one might be more inclined to blame Helen Clark's administration, since it had 10 years to do something. Keys is less implicated...just 2 years in power, and 1 year dealing with a recession. But he is an investment banker...sorry salesman, so he was never the person to fix the problem. But of course he will have a compelling reason now....after the fact.
There is of course a huge conflict of interest in government being the regulator and the law maker. This conflict is never resolved because it does not serve government to resolve it.


'Buying NZ Property – Download the free sample readings!

NZ presents some of the most alluring property in the Western World; particularly given the greater easy of residency, the low cost of property, and the liveability of the country. In addition, there is no capital gains tax, transfer taxes, VAT/GST or wealth taxes in NZ, so rest assured that NZ property is tax-effective! Learn more now!

New Zealand Property Report 2010 - Download the table of contents or buy this 180-page report at our online store for just $US19.95.


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