It is said that Tainui Māori knew that waro (coal) had heating properties and used it for cooking. The first European use was probably at Shag Point on the Otago coast, where whalers used coal to heat trypots for rendering blubber.
The settlers of the 1840s, knowing that Britain’s industrial revolution had been fuelled by coal, quickly prospected for it. Thomas Brunner recorded coal in the Grey River in 1848, and by 1860 most of the main fields had been discovered – in that year Julius Haast noted the potential of the Denniston plateau in Buller.
The first New Zealand mine was established in 1849 at Saddle Hill, Dunedin, and over the next 20 years a number of small working mines were set up. Most were mere holes in the ground employing a handful of people, often on a seasonal basis, and catering for the local market. In the south, mining began at Kaitangata in 1858, at Green Island in 1861, and at Shag Point the next year. The Malvern Hills mine in Canterbury was worked from 1862, and in Golden Bay there was a small mine at Collingwood from 1868. In the North Island the largest operation, which started in 1865, was at Kawakawa.
In the 1870s promoters imagined a thriving coal industry as the basis for New Zealand’s industrial future. Coal was essential to Julius Vogel’s expansionist immigration and transport policies. Trains were fired by coal, and increasingly, ships’ sails were replaced by coal-powered steam engines. During that decade, coal became New Zealand’s fifth-largest import, mostly from Newcastle in New South Wales. With such demand, mining attracted investors.
In the heady days of the 1870s there was much unrealistic boosterism. For instance, in 1873 the Albion Coal Company attracted £60,000 from investors as far away as Auckland for a mine at Ngakawau in Buller. Investors were not so happy when they learnt that the coal was friable and disintegrated in the open air, and a bar made the Ngakawau River impassable.
The first field with major potential was at Brunner in the Grey River valley. Mining had begun there in a small way in 1864. Once a railway to Greymouth replaced barges in 1876, and a new bridge across the Grey River was completed the next year, the Brunner mines were able to expand. A new breakwater to counteract the harbour bar also helped. By 1888 the field was producing a third of New Zealand’s coal output, which had tripled from 10 years before. Coking and brickworks developed as spin-offs. Coke was made by baking coal to remove the volatile matter and water to produce a smokeless fuel. Four years later another deposit was opened further up the valley at Blackball.
Transport improvements were the key to Buller’s success. The quality of the coal on the Denniston plateau, some 600 metres high, had been quickly recognised. But it was the completion of the cable railway known as the Denniston incline in 1879, and the branch rail line to Westport, that made mining the field possible. The incline gained a local reputation as the ‘eighth wonder of the world’. It was just over 1.5 kilometres long, with a very steep gradient.
The best coal
In 1889 HMS Calliope, a British warship, took on Westport coal at Wellington before heading for Apia in Samoa, where there were six other warships in port. When a tropical cyclone drove the ships shoreward, the Calliope fired its engines and proceeded out to sea. When it returned, it was the only ship still afloat. Calliope’s engineer attributed its survival to the quality of the coal. This made Westport coal’s reputation, and the British Admiralty stationed a coal-purchasing agent in Westport.
Denniston was funded by a group of Dunedin businessmen, including James Mills of the Union Steam Ship Company. By 1887, through its majority ownership of the Westport Coal Company, the Union Company had effective control of the Denniston mine in addition to its buy-out of the Brunner mines the previous year. This ‘southern octopus’ monopolised the West Coast fields, which by 1896 were producing over half of New Zealand’s coal.
Otago and Waikato
In Otago, the Kaitangata mines employed over 140 men in 1896 (compared with 315 at Denniston), and at Huntly in Waikato, where mining had begun in 1876, there were over 100. Many small operations sprang up. In 1896 there were 163 mines, but only 20 employed more than 20 men. By 1900 New Zealand was producing over a million tons of coal annually, a six-fold increase since records began in 1878, and over eight times the amount being imported. Coal had become the country’s main energy source.