The Government's early encouragement of Solid Energy's mad lignite schemes and poor oversight of their financial management has caused an almost $400 million debt and the loss of hundreds of jobs. While National Ministers publicly blame the company, they are holding no one responsible (the "perfect storm") and ex CEO Don Elder has become New Zealand's most highly paid gardener.
Bill English enthusiastically helping Don Elder dig a huge financial hole
The suffering of families who built their lives around Solid Energy's fossil fuel empire will continue for some time as they search for new jobs and possibly head for Australia, where coal mining is also struggling.
In Southland, where the company poured millions of dollars to promote the lignite industry, we have been left with the memories of great promises and a dodgy $29 million lignite briquetting plant. While it is claimed that the plant is a going concern and has potential, locals have witnessed truckloads of substandard briquettes being dumped into the New Vale Mine and have not seen it operating for more than three days on end. There is still no known market for the briquettes and the volatility of the lignite dust still causes concern for worker safety. The North Dakota plant, that the Mataura one was modeled on, has been mothballed and it seems crazy that Solid Energy would have pursued a technology that had no international demand.
Australian based GTL Energy will be taking over the plant and claim that they will be able to convert 150,000 tonnes of lignite into 90,000 tonnes of high quality briquettes a year. I will believe it when I see it and I think that the Mataura Fire Brigade may be severely tested in the near future.
To cover debt, Solid Energy is selling the 3500 hectares of farmland that they had originally bought to mine. They are currently the largest owner of arable land in Southland and, while it is with some relief that the land will continue to be used for agriculture, it is concerning that few New Zealanders will have an opportunity to buy some. As with the Crafar farms (bought by China's Shanghai Pengxin), Solid Energy are also selling their farms as one lot. Former Federated Farmers Southland president Hugh Gardyne would rather have the farms sold individually to local farmers than an overseas investor.
It looks as if the ripples from the Solid Energy Empire crash will continue for some time.
It is ironic that the address of Solid Energy's "Palace" (as it was known) is 15 Show Place.