WA IHI NORTH PROJ ECT ECONOMI C IMPACTS For New Zealand consenting purposes only. Forward looking information must not be relied on for investment purposes. 6 o The largest impacts tend to be on road transport and fuel retail, services such as repair and maintenance, engineering, construction, labour hire, fabricated metal manufacturing, and machinery and equipment wholesaling. The list is long and diverse because the requirements from suppliers are wide ranging. o We estimate that if precious metal mining stopped in New Zealand, for every job directly in mining, 3.7 jobs elsewhere would be at risk. o The purchases tend to be split roughly a third in the local district, about twothirds regional and national and a small remainder to international suppliers. • Contribution to GDP: We can estimate the contribution to GDP by matching the incomes from labour and capital attributable to OGNZL operations and royalties. We estimate that Waihi mine’s economic contribution in 2019 was $103m. o Conceptually, we are trying to measure GDP on an income basis. GDP is measured in three ways: production or value-added basis, final expenditure basis, or on an income to labour and capital basis. The latter is easiest to match to reported financial accounts. o We use OGNZL’s 2019 Annual report, supplemented with other company data and other external data. We estimate this to be $103m in 2019 (and $59m in 2020. This is because ore is depleted in the Correnso Underground operations and recoveries are small. o This is made up of the income paid to employees, the gross operating surplus of the operations and royalties paid. These are the closest measures to the way income GDP is calculated. o The Waihi mine’s GDP contribution makes up 34% of the Waihi Ward, 14% of the Hauraki District, 0.4% of the Waikato Region, and 0.03% of the national economy. The regional comparisons need to be made with caution, as suppliers and staff can live across political boundaries like Territorial Authority or Regional Council boundaries. This means the economic contribution is not strictly attributable to that region only. We also supply local expenditure estimates to allow more appropriate district level analysis. o OGNZL’s economic contribution is highly productive. Labour productivity, measured as GDP per employee, was $392,000 in 2019, nearly 3.5 times the economy wide average of $115,000. • Hauraki district expenditure: We also report expenditure on local suppliers from our analysis of purchase orders. Around 30% of purchases are from the Hauraki District. • Conclusion: OGNZL’s Waihi operation is a significant economic entity in New Zealand. o It accounts for 0.3% of all merchandise exports from New Zealand.
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