By Kent Atkinson of NZPA

Wellington, July 25 NZPA - Miners say New Zealand has $140 million worth of metallic minerals left in the ground , but needs a better approach to extracting wealth from both those minerals, and its oil, gas and coal.

"The investment environment for exploration in New Zealand is not attractive," consultant geologist Richard Barker, author of a report for the industry's main lobbyist, the Minerals Industry Association, said.

Mr Barker said there was considerable potential to boost the range and value of the nation's exports.

"But the barriers to the realisation of New Zealand's resource potential can be overcome if its potential value is recognised and its management given a higher priority."

Mining of hydrocarbons and minerals -- about 50 billion tonnes annually -- was earning the country $4.5 billion a year, including about $2 billion in exports, but Mr Barker said spending on energy exploration was being compromised by changes in energy policies.

Particular constraints were seen in proposals to limit greenhouse gas emissions by stopping new electricity generation from coal or gas.

The association has produced the report for the Australasian Institute of Mining and Metallurgy (AusIMM) conference in Wellington at the start of September, but is also mounting a political campaign in the run-up to the general election.

Mr Barker said the nation's coal deposits included $100 million in lignite -- much of it in Southland -- and there was "good potential" for discovery of new oil and gas resources.

But he warned that New Zealand ranked behind all the Australian states and Canadian provinces in terms of its attractiveness for exploration spending.

New Zealand was well positioned in terms of things that couldn't be changed, such as geological resource, political history, human resources and government traditions.

"The obstacles are mainly things that can be changed," he said.

"We have great mineral wealth potential, and there is room to increase the returns on that substantially."

Problems include fragmented government administration and management, a complex and uncertain regime for mineral ownership, deficiencies in access provided under the Crown Minerals Act, energy policies that created uncertainty and discriminated against coal and gas, and an "uncompetitive" environment for investment in comparison with similar countries.

Mr Barker noted the sector's value to the nation jumped by 93 percent between 1999 and 2006.

This growth could continue as much of the demand for minerals was coming from developing nations still building their industrial sectors - and New Zealand could fill part of that demand.

Australia had worked hard with major government and industry initiatives to exploit its mineral wealth, by comparison New Zealand had done little over the last 25 years to make the most of its resource potential.

Minerals Industry Association chief executive Doug Gordon said a key issue was a perceived lack of political will: "We need a central government champion for the country's natural resources".

He acknowledged "residual environmental concerns from the past" but said modern miners were committed to environmental sustainability.

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