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Gold and gold mining

by  Carl Walrond

In the 19th century discovering gold was a way out of poverty. From the 1860s gold rush followed gold rush, and thousands flocked to the fields. But the work was harsh, with days spent digging in cold creek beds. Only a lucky few found riches in the rock. However, the collective value of the gold that was discovered kick-started the young colony’s economy. Gold was the making of early New Zealand.

As good as gold

All that glisters

Although rumours and traces of gold surfaced in New Zealand as early as the 1820s, the first European discovery of payable gold is attributed to Charles Ring, a Tasmanian who found it at Driving Creek near Coromandel township in 1852. Discoveries near Collingwood in Golden Bay (1856), Gabriels Gully in Otago (1861), Wakamarina in Marlborough (1864) and at Greenstone Creek on the West Coast (1864) followed. Not all discoveries translated into major finds. The ones that did were on Coromandel Peninsula, in Otago and on the West Coast, where there were significant gold rushes followed by decades of mining.

The early mining of the 1860s in Otago and on the West Coast was mainly undertaken by individuals working alluvial deposits (river gravels). In three separate years in the late 1860s and early 1870s the amount of gold won exceeded 20,000 kilograms. These totals have never been bettered. From the 1870s mining became more mechanised. Companies were floated, and dredges and sluicing ventures won more and more gold. Underground mining, which tunnelled out quartz veins that were crushed to release their gold, boomed on the Coromandel Peninsula and West Coast from the 1870s.

Gold mining had declined by the 1920s, and from the 1950s it was a very small industry. The rise of gold prices in the late 1970s brought about a revival, with new technology allowing opencast pits to be dug in Otago and on the Coromandel Peninsula in the 1980s and 1990s.

How much gold?

No one knows exactly how much gold has been found in New Zealand. Official records show that up to 2003 a total of 998.71 tonnes had been mined – about 0.8% of all the gold mined in the world. Because gold-production records have been collected in different ways over the years there are gaps in figures and inconsistencies. Available figures show that up to 2003 a minimum of 312 tonnes had come from the Coromandel Peninsula, 274 tonnes from the West Coast, and 265 tonnes from Otago.

The two major booms in production were in the 1860s (alluvial gold won by diggers) and in the decade after 1900 (underground hard-rock mining). There was a smaller boom starting in the late 1980s (opencast hard-rock mining).

Where you find it

Gold, any miner will tell you, is where you find it – as the Cornish miners said, ‘Where it be, there it be’. Many geologists would agree, but they would also add that gold is likely to be found only in certain areas. In New Zealand these areas are Otago, Southland, the West Coast, Golden Bay and Marlborough, Coromandel Peninsula and a few other localised places.

Gold is a rare element. It is inert, very heavy, shiny and malleable. It is gold’s aesthetic properties and rarity that command a high price. Only 10% of global production is used for industrial purposes. Its main use is in making jewellery. It rarely occurs in a pure form, and is usually mixed with silver and other metals. In New Zealand, Otago and West Coast gold is purer (93–98% gold, with 2–7% silver or silver plus mercury), while on the Coromandel Peninsula it occurs as the gold–silver alloy electrum (typically 65% gold and 35% silver in the Martha mine at Waihī) along with separate sulfide minerals.


In New Zealand silver mainly occurs in association with gold on the Coromandel Peninsula, where about 1,440 tonnes of silver have been recovered from mining of the gold–silver deposits (1,212 tonnes of this has come from the Martha mine). Early reports of silver finds near Collingwood in Golden Bay and other localities amounted to nothing of economic value.

Hard-rock sources

Gold occurs in fissures and fracture zones, where it has been deposited in quartz veins. It is almost always in very fine flecks in the quartz veins, usually too small to be visible. Gold can be deposited near the earth’s surface (epithermal gold) and at greater depths (mesothermal gold).

Epithermal gold can be found with silver in quartz veins on the Coromandel Peninsula. It has been deposited at depths of up to 1,500 metres by hot spring fluids at temperatures of 180–300°C.

Mesothermal gold occurs in the schist rocks of Otago and Marlborough. Here, gold has been deposited at depths of 3–12 kilometres by hot fluids at temperatures of 200–400°C. Greywacke and argillite rocks in the Aorere valley in Golden Bay, Lyell, Reefton and Mt Greenland on the West Coast, and at Preservation Inlet (Rakituma) in Fiordland, also contain mesothermal gold in faulted areas known as shear zones.

‘Chinaman’ and ‘Maoris’

While washing gravel with millions of litres of fresh water, the alluvial miners working in Central Otago named things as they saw them. Large quartz boulders that had been stained yellow by leaching minerals were called ‘Chinaman’, while dark, heavy boulders rich in iron were ‘Maoris’.

Alluvial gold

Alluvial or placer gold comes from eroded hard-rock sources. Rivers and glaciers flowing over gravels have washed and sorted them, concentrating the heavy gold in certain layers. This often makes placer gold deposits much richer than their hard-rock sources.

Alluvial gold can be mined by digging it up with earth-moving equipment, sluicing, dredging, or by hand with a gold pan and shovel. There are localised deposits in Nelson and Marlborough. Little placer gold has been found on the Coromandel Peninsula. It is most widely distributed in Otago and the West Coast, including West Coast beaches such as Gillespies Beach, and at Orepuki in Southland. Offshore gold deposits exist off the West Coast and Otago, although prospecting has been limited by the difficulty of sampling the sea floor.

Mother lode

The gold in river gravels convinced many miners in Otago that there must be a mother lode – a hard-rock source upriver. In a few places rich veins were found and worked – at Skippers, Bendigo and Macetown. Over thousands of years, glaciers and rivers had ground away Otago’s schist, which contained gold-bearing quartz reefs. So the gravels beneath glaciers and rivers often contained higher gold concentrations than the existing hard rock. There was no mother lode; or rather, the mother lode was the alluvial gold itself.


Rivers of gold

Historically in Otago the majority of recovered gold was alluvial – less than 10% came from hard rock. Otago’s gold is linked to its schist rocks. Over the past 100,000 years glaciers ground away at the rocks, which were threaded with quartz veins containing gold, and rivers washed and sorted the gravels. These processes concentrated the gold by separating the heavier minerals from the lighter ones. The first miners literally picked up nuggets where they lay.

Gabriels Gully

On 23 May 1861 Gabriel Read gained esteem and provincial government bonuses when he found gold. He also saw his name given to the locality of the find, Gabriels Gully, near Lawrence. Another character, Edward Peters, had found gold earlier than Read in the same area, but he had not proven that the deposits were extensive enough to be economically worked. Eventually he was awarded a smaller bonus.

Thousands of diggers hastened to the scene of New Zealand’s first major rush. The gully became a canvas town overnight as diggers moved in to work the rich blue-spur rock where Read had uncovered gold ‘shining like the stars in Orion’.

Aurum and Ophir

There are many place names in Central Otago that hint at past gold rushes. For example in the upper Shotover River there is Mt Aurum (Latin for gold) – miners in the 1860s believed the mountain was the source of the gold in ‘the richest river in the world’. And a site near Alexandra was named Ophir, after the Old Testament place associated with fine gold.

The Dunstan rush

When American Horatio Hartley and Irishman Christopher Reilly deposited a bag of gold weighing just under 40 kilograms on the Treasury desk in Dunedin in August 1862, the rush to Dunstan (the area around Cromwell) was on. Diggers worked the river beaches of the Clutha, Kawarau and Shotover, and higher up in their tributaries. A lucky few made a packet. Many perished in heavy snowfalls and winter floods. In icy gorges the sun never reached the floor and piles of wash froze cement-hard. A diet of flour and tea meant that many developed scurvy. At the peak of the Otago rush in 1863 the goldfields population was estimated at 24,000. Other discoveries in Otago followed, and men moved from field to field.


Central Otago was isolated and rugged. One miner, after struggling into the area, remarked, ‘It is said that Victoria only wants fencing in. This island wants hammering out flat’. 1 Getting supplies to diggers was a major undertaking. Wagons took weeks, and coaches took days to go from Dunedin to Alexandra over the Pigroot and Dunstan Road. Central Otago as tussock land lacked timber for fuel, so ‘buffalo chips’ (dried dung) and ‘kaladdies’ (flax flower heads) were used for boiling travellers’ billies. The wagoners were a tough breed, enduring weather cold enough to freeze their beards.


Once the easy alluvial gold had been won, mining became mechanised and sluicing claims began. Working deeper alluvial leads required cooperation, the amalgamation of claims, and capital. Companies were formed, and most of the gold won after the 1870s was taken by companies where miners were paid wages, rather than by individual miners.

Hard-rock mines were established. Small towns sprang up in isolated areas, but most reefs were quickly exhausted and today only ghost towns remain. Hidden mine shafts that killed the odd sheep have now mostly been marked or fenced off, although it pays to watch your step among the tussocks and schist tors in gold-mining country.

By 1900 the romantic figure of the digger with his pan and shovel was history – he had been replaced by dredges and underground mines.

  1. Quoted in Tom Field and Erik Olssen, Relics of the goldfields: Central Otago. Dunedin: J. McIndoe, 1976, p. 20. › Back

West Coast


Following the discovery of payable gold in Otago in 1861, the Canterbury provincial government offered a reward of £1,000 to anyone who found gold in Canterbury. This gave prospectors an incentive, and colours soon showed up in gold pans in West Canterbury (today’s West Coast). Payable gold was discovered in Greenstone Creek, a tributary of the Taramakau River, in 1864, leading to the frantic rushes of 1865–67 as more discoveries followed. Like Otago, the early gold on the West Coast was alluvial. It attracted men from the Otago goldfields, and ships landed diggers directly from South Australia.


There were no roads and the diggers had to cut their way through bush. It took time before they could set up stores, and the first miners ate kererū (wood pigeons), potatoes, fern and kōnini berries. They explored the country between Greymouth and Hokitika, and mined beach sands at Ōkārito, Addisons and Charleston. The diggers described the alluvial deposits as ‘tucker ground’ – good enough for yielding food, but it was as if the gold had been spread evenly but sparingly by some unseen hand.

The rush

Richer finds followed, and the success of the rush could be seen at Christmas 1865, when all of Hokitika’s 72 hotels were packed with boozing miners. These were the days of the wild West Coast. Sly-grog shops illegally selling alcohol sprang up with each new field. Towns like Goldsborough emerged from the bush and disappeared when the gold was worked out. At the peak of the rush, in 1867, there were probably about 29,000 people on the West Coast – around 12% of New Zealand’s European population at the time. One in five of the European men in New Zealand were on the ‘roaring’ coast, but there were few women.

The 1860s goldfields could be lawless. Fights, claim-jumping and murders occurred, although most trouble just stemmed from drunkards. The goldfields had their own terminology. Planting gold to give a false indication of a field’s wealth when selling up was known as salting the claim. And rushes that resulted in no gold were duffer’s rushes (on the West Coast there are numerous Duffers Creeks).

Quartz reefs of Reefton

The discovery and development of gold-bearing quartz veins near Reefton around 1870 marked a shift from alluvial to hard-rock mining. Unique names are a remnant of the coast’s hard-rock mining days. Crushington lies south-east of Reefton, and was where quartz-crushers worked day and night extracting gold from the Globe mine. Quartzopolis was an old name for Reefton (shortened from Reef town), where mines such as the Wealth of Nations and the Keep-it-Dark paid handsome dividends to lucky shareholders. The reefs were rich, but hard-rock mining also required a much bigger investment. Companies were established and machines did more of the work. Quartz was crushed by pounding stamper batteries – between 1870 and 1951, 84 Reefton mines produced 67 tonnes of gold.

Once gold dredging proved itself in Otago it was also used on the West Coast to work river gravels or old river channels. Sluicing was practised extensively in places such as Kūmara. Gold was taken from beach gravels using riffle tables on wheels (known as Long Toms). The gold occurred in thin layers of black sand, and because the particles were so fine, much was washed away. To prevent this, some miners used boxes fitted with copper plates coated with a mercury amalgam which caught the gold.

Falling diner

A Ross gold miner built a hut on some dry stone tailings. Hidden beneath was a shaft. He was busy preparing supper, when the floor collapsed and he was buried. His mates dug into the night, until incredibly, 15 metres below, they found him, ‘bruised, but little injured … In his sudden descent he had clutched at the blanket on his bunk, and they found him with it, and the frying-pan, which he had also stuck to, little the worse for his marvellous adventure.’ 1


Safety was poor and funeral processions were common in mining settlements. Falling boulders and collapsing terraces claimed lives in alluvial workings. Underground miners fell down shafts. Conditions such as silicosis (caused by inhaling quartz dust and also known as phthisis) created breathing problems and proved fatal for some. In 1915 the Miners’ Phthisis Act was passed which provided pensions to miners with silicosis and financial compensation for widows and children.

    • Henry W. Harper, Letters from New Zealand, 1857–1911: being some account of life and work in the province of Canterbury, South Island. Christchurch: Kiwi, 1999, pp. 167–168 (originally published 1914). › Back

Coromandel Peninsula

Payable gold

The first rumours of gold in New Zealand came from the Coromandel Peninsula in the 1820s. Nothing came of the reports for decades. Then in 1852 some Aucklanders offered a reward of £100 for the discovery of a payable goldfield near Auckland. When the reward was increased to £500, a sawmiller named Charles Ring claimed it after he found golden flakes in his pan at Driving Creek, near Coromandel town. His find led to only a small patch of alluvial gold – by April 1853 less than £1,200 worth had been won. But even a small strike attracts prospectors, and if the original strike fails they search again. Prospectors found little until quartz reefs were uncovered in the hills of Coromandel Peninsula in the early 1860s. But extracting gold from quartz was difficult.

Hard rock at Thames

The first big strike was near Thames in August 1867, when a speck of gold was seen in the rock face of a waterfall in Kuranui Stream. Other reefs were uncovered, and within months the Thames foothills swarmed with men. Mining quartz reefs needed capital investment to tunnel, mine the ore, crush it and separate the gold. This type of mining favoured larger companies and gradually they took control of production.

Some reefs were spectacularly wealthy. In 1870 the Caledonian mine in just over a year produced 140,000 ounces (3,969 kilograms) of bullion (silver and gold). At the peak of the rush in 1868, 18,000 people were living in Thames. Other very rich reefs were soon discovered and quickly worked out so that by the 1890s the big gold rushes were over. Miners now knew where the gold was, but they needed to find an economic way to mine it.

Recovering the gold

Machines called stamper batteries, which crushed quartz into powder, were set up in the Coromandel ranges. Most mines were steadily producing ore, but the recovery methods were highly inefficient (only 45% of the gold and barely any silver was recovered).

In 1889 the cyanide process was trialled by the New Zealand Crown Mines Company at Karangahake – the first time in the world cyanide had been used on a large scale for commercial mining. Cyanide was added to crushed quartz ore. Gold and silver dissolve in cyanide, allowing more of these metals to be recovered (about 90% of gold and 50% of silver). They are extracted from the cyanide solution using chemical processes.

The new process was a leap forward as it made lower-grade deposits profitable. Previously, much fine gold had been lost, and in places it paid to rework tailings (waste rock) with cyanide to recover the lost gold. Cyanide recovery stimulated investment. Mining continued successfully until the 1920s, by which time many ore reserves were depleted. The depression saw a brief flurry of new mines but nothing came of them.

A handful of very rich mines dominated production. One was the Martha mine at Waihī, which when it closed in 1952 had produced a total of 992,233 kilograms of bullion. Waihī was the site of a large miners’ strike in 1912 – a bitter wrangle that lasted six months and resulted in New Zealand’s first death in an industrial dispute.

In the late 1960s the Tui mine at Te Aroha and the Ohinemuri gold and silver mine at Maratoto reopened. They did not last. Both closed in the 1970s after producing a further 5,018 kilograms of mainly silver, and some gold.

Other goldfields

As time would tell, the big deposits were in Otago, the West Coast and on Coromandel Peninsula, but gold was also found elsewhere in New Zealand.

Golden Bay and Nelson

Golden Bay is not named for its sunshine, but for its gold. As early as 1853, traces were found in the Aorere valley, and larger deposits were opened up in 1857. Some 2,500 men spread out from Collingwood working alluvial gravels. Good gold was found elsewhere in Nelson in places such as the Mātakitaki valley, Mt Arthur, Wangapeka, and in the Buller Gorge at Lyell.

Wakamarina River, Marlborough

In 1864, gold was discovered in the Wakamarina River, a tributary of the Pelorus River. Up to 6,000 Otago miners rushed to the workings, as initially these were very rich. A tent town sprang up, with 3,000 men giving the name Canvastown to the area. But the river gravels were worked out quickly and the rush soon passed. Later, reef gold was also discovered, but it was low grade and the reefs were mainly worked for the tungsten mineral scheelite.

Preservation Inlet, Fiordland

Payable alluvial gold was dug from Coal Island in Preservation Inlet (Rakituma), Fiordland, in the 1880s. In the 1890s two small towns, Cromarty and Te Oneroa, were cut out of the bush as quartz reefs were found and hard-rock mines were used to excavate them. But the gold did not last, and by 1904 few miners remained.

Orepuki and Round Hill, Southland

In the 1860s patches of black sand on the beach at Orepuki, near Riverton on the Southland coast, were found to yield very fine gold and platinum. Sluicing soon won gold from coastal terraces. Other finds at nearby Round Hill proved even richer, and extensive sluicing operations continued until the 1950s. A distinct feature of Round Hill was the Chinese settlement of Canton, which housed around 300 Chinese miners in 1888.

Gold in Southland was also found in the Waiau catchment at Blackmount and the Mataura catchment around Waimumu, Waikaia and Nokomai.

Terawhiti, Wellington

Traces of gold were known from Cape Terawhiti, near today’s Wellington suburb of Karori, as early as 1852. In the 1870s and 1880s a number of quartz reefs were worked, but they yielded very little gold.

A legal thumping

Warden’s courts settled mining disputes. In Collingwood, warden James Mackay was presiding when a miner hotly disputed his ruling:

‘Mackay adjourned the proceedings while he “consulted in chambers”. In a few minutes they returned, Mackay smiling grimly, and the case was settled; but it was noticed that the miner’s eye was rapidly changing colour by the time he left the building’. 1


Once gold was discovered and an area proved workable, it could be declared a goldfield by provincial governments. However, there was little governance. In the late 1850s the rush to Collingwood in Golden Bay had exposed the lack of laws regulating goldfields. This prompted the Miners’ Code, which outlined procedures such as how claims were to be staked and disputes settled, and it gave rise to the Mining Act 1859. Gold wardens were appointed to oversee goldfields, and disputes were heard in the warden’s court.

    • J. Halket Millar, Westland's golden ‘sixties. Wellington: A. H. & A. W. Reed, 1959, p. 29. › Back

Methods of mining

When a miner found an area of payable ground he pegged out a square claim. The size of claims varied among goldfields, but were usually 24 feet square (53.5 square metres). Miners often teamed up with mates to share claims and workings.

Shovel, pan and cradle

Gold mining was rough, physical work. Where alluvial gold was very rich, it could be obtained with a shovel and pan. However, pans were used mainly for prospecting. Simple machines known as cradles (often made from wooden liquor boxes) were rocked back and forth – the heavier gold collecting on matting on the cradle base.

Sluice boxes

Riffle or sluice boxes were the main methods of recovering gold. Nicknamed Long Toms, these were long, terraced wooden boxes, over which gold-bearing gravel was washed. Each step of the box had a lip that trapped the heavier gold and allowed the lighter materials to wash away. Eventually the heavy gravel and gold caught in the terraces was washed up in a pan.

These methods all relied on water, without which recovering gold was impossible. At each of New Zealand’s goldfield’s there were small dams and water races – channels that cut across contours, bringing water from creeks to areas where gold was worked.


Sluicing was a method where water was piped into successively narrower pipes leading to hoses (with nozzles called monitors), which sprayed jets of water strong enough to kill a person. The jets were aimed at gravel faces and helped to wash gold-bearing gravels down through sluice boxes. In places like Bannockburn and St Bathans in Central Otago distinctive gravel pillars are a legacy of these giant water guns.

Hydraulic engineering

Hydraulic elevators were used to reach leads of alluvial gold that were covered by gravel. Most elevators worked like giant vacuum cleaners, sucking a slurry of gravel and water up from beneath large gravel terraces.

Engineering was also used to expose river beds. The Oxenbridge tunnel on the Shotover River and the dam gates across the source of the Kawarau River draining Lake Wakatipu at Frankton are the two most famous examples. Both were spectacular failures – little gold was found in the exposed bed of the Shotover once water was diverted through the tunnel. And when the Kawarau dam gates were closed they had little effect on water levels downstream.

Hard-rock mining

Hard-rock mines followed quartz veins, which contained gold. Underground mining was very expensive as tunnels had to be blasted and the roofs supported. Mines such as those at Waihī on Coromandel Peninsula and Waiuta on the West Coast followed reefs until they became too deep or low grade to be mined economically. The recovered quartz was crushed by stamper batteries, and cyanide was used to reclaim the gold.


Spoon dredges

It was not necessary to expose the river bed to mine it. There had been plans to use a submarine, the Platypus, to recover gold from the bed of the Clutha River, but the idea was not practical. More useful were floating barges known as dredges, which scooped gravel off river bottoms, separated the gold on board, and dumped the waste rock. In 1863, spoon dredges began working the Clutha. These were crude and only involved dragging a spoon dredge (a leather bag tied around an iron loop attached to a pole) across the river bed. Some gold was won, but spoon dredges could not dig deep or process much gravel.

Bucket dredges

In 1868 the bucket dredge was developed. A series of buckets on a long chain continuously dug up gravel. Originally these were powered by wheels turned by the river’s current. In 1881 the first steam-powered dredges were used on the Clutha River, and electric-powered dredges arrived in 1890. These could also be used in ponds away from the main river channel, allowing old river channels to be worked.

In 1888, the Chinese businessman Charles Sew Hoy of Dunedin ordered a steam-powered bucket dredge to be built in a Dunedin foundry. It had a string of buckets on a ladder that could be lowered to the river bed and onto river flats on the shore. It was immediately successful on the lower Shotover River. This is considered to be the prototype for the New Zealand style of dredge. Gradually this design and variations of it proved to be adept at removing gold from river beds or artificial ponds on river flats. By the 1890s Dunedin was at the forefront of gold-dredge design and it was not long before New Zealand-style dredges were being successfully used overseas.

Boom years

Over the next 20 years hundreds of dredges recovered tens of thousands of ounces of gold from the beds of Otago’s rivers and old river channels. A dredging boom that reached its zenith about 1900 was characterised by the use of many small dredges. In 1900 there were 228 dredges working in Otago and Southland. By contrast, a second boom in the 1930s and 1940s saw a few large, powerful dredges.

Dredging created unique local landscapes such as the Earnscleugh tailings near Alexandra. Essentially they are piles of stones – in Otago’s dry climate, vegetation has not covered them.

West Coast dredging

Dredges worked the West Coast in lesser numbers – an estimated 150 dredges mined there. It was, however, where they remained in use the longest. From 1956 the Kanieri, a large bucket dredge that employed 38 men, worked the Taramakau valley before moving to the Grey River, where it dug up gravels near Blackball and Ngahere. The Grey River dredge, New Zealand’s last big dredge operation, won its last gold in 2004.


British Isles

The miners were a mixed bunch, but they were dominated by a few groups. Myth may attribute the origins of many of those who mined in New Zealand to the Californian forty-niners, so named because of the 1849 rush to the Californian goldfields. But in truth few had ever set foot in California. The influx was from the Victorian goldfields, which had attracted British miners in the 1850s. They brought Victorian names with them – in Central Otago there is a Bendigo ghost town and a Ballarat Creek. Scottish, Irish and English miners made up roughly equal proportions on the Otago goldfields.

Log and chain

On Otago’s Arrow diggings in the 1860s there was no jail, so prisoners were often chained. One wild, drunken Irishman awoke to find himself attached to a log:

‘When he recovered he was attacked by a violent thirst, and seeing that he could not release himself from the log he hoisted it to his shoulder and walked with it to the nearest pub where the police found him drinking heartily with the log still athwart his shoulder.’ 1

Many miners who had not struck it lucky in Australia paid their fare and sailed across the Tasman Sea to New Zealand’s West Coast. A third to one-half of West Coast miners were Irish. English miners made up a third and most came from counties with a mining history such as Cornwall. Scattered among the British and Irish were Germans, Scandinavians, French, Italians, Chinese and other nationalities.

A sample of 1,587 miners treated at West Coast hospitals in the 1860s and 1870s revealed that some 80% were from the British Isles, 11% from continental Europe, and most of the rest from Australia or North America.


Goldfields were populated mainly by young single men looking to make their fortune, but there were also married men who had left wives and children at home. It was only on lucrative goldfields and hard-rock mines, which lasted beyond a few years, that women and children were more commonly seen. Early in the Otago rushes barmaids did not last long before they were married off. Publicans struggled to retain staff – they even advertised for the ugliest barmaids they could find, but those too received marriage proposals. The lines of an 1860s New Zealand folk song, ‘Bright fine gold’, summed up the outlook of a digger’s wife:

A new home

In the 1930s, when poverty was widespread, unemployed men took to prospecting. Fred Miller fossicked near Roxburgh in the Clutha River gorge. He found an old miner’s cave and made it habitable. His wife Peg, living in Dunedin, joined him with their three-year-old son:

‘I was almost afraid to look at Peg’s face … I knew it took all her courage to smile as she entered her new home, and as she unpacked and prepared a place in one corner for the child I pretended I did not see the tear that splashed on to her hands’. 2

I'm weary of Otago
I'm weary of the snow
Let my man strike it rich
And then we'll go.

But most men earned only enough to live on, if they were lucky.


Gold mining was a major source of employment in early New Zealand. After mining, many moved into farming or other professions. Those who were struck by gold fever stayed, living out their lives in shacks until they were too old or infirm to work a shovel and gold pan. These old prospectors were known as hatters. Their passing marked the end of a pioneering era, when men could be footloose drifters who entrusted their fate to gold in the gravel.

  1. Tom Field and Erik Olssen, Relics of the goldfields: Central Otago. Dunedin: J. McIndoe, 1976, p. 23. › Back
  2. Frederick W. G. Miller, There was gold in the river. Wellington: A. H. & A. W. Reed, 1946, p. 29. › Back

Māori and Chinese miners

Māori miners

Māori knew the South Island mountain passes and rivers from their trips to collect pounamu (greenstone). Early prospectors had Māori guides. When Māori realised the worth that Europeans placed on gold, some joined the rushes. In 1858 there were 600 Māori men working the Collingwood fields alongside 1,300 Europeans. It was Māori prospectors who revealed the promise of the West Coast when they showed a Collingwood shopkeeper their gold. He recognised the coarse gold as different, and after questioning they led him to the Arahura River.

Māori were less common on the Otago fields. Even so, Māori Point on the Shotover River takes its name from Daniel Erihana and Hākaraia Haeroa’s 1863 find. When their dog was swept away and Daniel swam after it, he chanced upon gold on a shingle bar and, so the story goes, gold dust in the dog’s coat. Before nightfall the two men had recovered 300 ounces (8.5 kilograms) of coarse gold from the rock crevices.

Cast into the river

Māori traditionally placed no worth on gold – pounamu (greenstone) was their valuable mineral. In the early 1800s an Otago whaler named Palmer was told by a Māori chief that the yellow metal of the watch-seals of white men could also be found on the beaches of the Clutha River. And about 1852, upon seeing a sample of Tasmanian gold, another Māori said he had once picked up a potato-sized nugget from the banks of the Clutha, and had thrown it into the river.

On Coromandel Peninsula, Māori resisted attempts to open up their lands to gold mining in the 1860s, but little could stand between Europeans and gold. In 1935 Hōri Wātene of the Ngāti Tamaterā tribe, testifying at a commission of inquiry into the Ōhinemuri goldfield, described gold as a curse because it had heightened European interest in their lands.

Chinese miners

The Otago provincial government encouraged miners, mainly from the Guangdong province in southern China, to come to New Zealand to replace the Europeans who had deserted the Otago fields by 1866 for new rushes on the West Coast. The Chinese intended to earn wealth for their families and eventually return to China.

Their mining methods were unique – they meticulously worked over an area and left very little gold behind, whereas most European miners were more haphazard. The Chinese preferred previously mined areas as there was known gold there, and they knew that much gold was lost in the washing up.

After finding gold in Otago and Southland, many Chinese miners were attracted to the West Coast. At Īnangahua’s alluvial gold workings they made up an estimated 40% (715) of the population in 1882, but numbers dwindled in the depression of the 1880s. Their celebration of Chinese New Year with fireworks added interest to the goldfields. Superstition kept some Chinese men out of tunnels. At locales such as Greenstone Creek on the West Coast, when constructing water races they cut deep clefts in the cliffs to avoid tunnelling.

Their appearance, dress, language and use of opium set the Chinese miners apart as different. They lived in their own settlements, and some owned shops supplying their countrymen. The population reached about 5,000 in the 1881. Prejudice saw a poll tax introduced in 1881 to discourage immigration. Most hoped to earn enough gold to return home, but many died in New Zealand. Some were disinterred to be buried at home, but the remains of 499 Chinese miners (including Charles Sew Hoy) instead had a sea-burial when their ship, the Ventnor, sank off the Hokianga coast in 1902.

A New Zealand movie, Illustrious energy (1988), depicts the Chinese gold miners of Central Otago, whose settlements have been restored and rebuilt in places such as Arrowtown.

Recent mining

Dredging and alluvial mining

The international price of gold was fixed for most of the 19th and 20th centuries. As other goods increased in price, gold became relatively less valuable. In the late 1960s the price of gold was allowed to float. It rapidly rose in the late 1970s, making many previously marginal mining proposals economic. This led to a small-scale production boom in the 1980s and 1990s. In Otago and especially on the West Coast two-man operations with an earth-moving digger and a rotating washing screen (known as a trommel) feeding into riffle tables were common. At the Shotover and Kawarau rivers, large diggers retrieved gravel from the river bed and fed it onto floating gold-recovery plants. These covered areas that had been inaccessible or less efficiently worked by earlier dredges. Mechanical diggers with buckets armed with teeth could rip up river beds made of hard-rock and expose the gold trapped in crevices.

Diggers revealed gold-bearing layers that previously had been too deep to mine. In the 1990s, large-scale alluvial opencast mining was carried out at Arahura and Ross on the West Coast, Nokomai in northern Southland, and near Millers Flat and the Tokomairiro River in Otago. All these operations required the removal of huge quantities of overburden (gravel overlying the gold). They were profitable only when the price of gold had risen and large, earth-moving machines were available.

Hard-rock opencast pits

In the late 1970s, hard-rock opencast mining also became economic. In opencast mining a big pit is made as surface rocks are removed to reach the gold-bearing rocks below. It is profitable where there are large, low-grade, hard-rock gold deposits near the surface.

At Martha Hill in Waihī and Macraes Flat in Otago, large opencast pits were dug in the 1990s and 2000s. These accounted for almost all of New Zealand’s recent gold production. Gold-bearing rock was blasted and front-end loaders filled up dump-trucks, which hauled the rock to processing plants. Macraes Flat used trucks with a payload in excess of 190 tonnes that can be filled by a 350-tonne excavator in about 140 seconds.

Reefton goldfield

At Reefton on the West Coast a major opencast gold mine (Globe-Progress) was being developed in 2005. Access roads, silt ponds, and a bridge over the Īnangahua River were under way and the mine is planned to be in operation by the end of 2006. There is estimated to be 17,000 kilograms of gold, and further exploration hopes to reveal further workable resources.

Underground mining

There have been few underground gold mines since the last of the Reefton mines, Waiuta, closed in 1951. Underground mining is expensive and only suited to where there are high-grade gold deposits. In 1981 a new vein adjacent to the former Golden Cross mine near Waihī was discovered. This resulted in the extraction of 20.5 tonnes of gold and 52 tonnes of silver from a rich ore deposit, between 1991 and 1998.

Underground mines were being planned in 2005 at Frasers near the Macraes Flat opencast mine in Otago and at Favona in Waihī. At Frasers, some 65% of the gold occurs in a 7-metre-thick ore band. Once underground mining begins by 2010, this ore deposit is estimated to yield about 1,700 kilograms per year. A discovery in the early 2000s of rich gold–silver quartz veins at Favona, 2 kilometres east of Waihī, was being developed as an underground mine.

Environmental issues

Modern mining must comply with the environmental conditions laid out in the Resource Management Act 1991. Past mining often polluted rivers with silt, and many sites were just abandoned. In response to this poor environmental record an anti-mining movement was active on Coromandel Peninsula in the 1980s and 1990s. A 1998 decision by the Thames Coromandel District Council to ban mining in certain areas was overturned by the High Court in 2005. Today’s mining operations must leave the land in the same or better condition as it was before being mined.

Gold and the economy

Without gold New Zealand’s early economy would not have developed as quickly as it did. Gold attracted people, investment and shipping. Miners had to be fed and clothed and their thirst satiated. Breweries sprang up, roads and bridges were built, and infrastructure developed.

Industrial and economic growth

Once mining became mechanised and capital-intensive, foundries supplied metal piping for sluicing and gold dredges were built. Many engineering firms, including Thames’ A & G Price, had its start in manufacturing mining equipment. The Paeroa–Waihī railway was pushed through to get at the gold in places such as the Karangahake Gorge. The New Zealand stock exchange was seeded by money earned on the goldfields. And Dunedin’s dominance among New Zealand cities in the late 1800s was due largely to the yellow metal. The first supply of commercial power and electric light in the southern hemisphere occurred in 1888 at Reefton, a mining town.

Mining schools

Gold also paid for higher education. The Otago School of Mines had its origins when a furnace was built at the University of Otago for assay work in 1872. Other schools of mines were established at Waihī in 1885 and at Reefton in 1886, where Cornish miners shared their knowledge of gold and gold-mining techniques. These institutions were necessary, because getting gold from hard rock was more technical than the simple methods used in alluvial mining. Assaying work, which determined how much gold was contained in quartz samples, was the lifeblood of these schools. Accurate assay work was critical because it measured the richness of deposits – companies were floated on assay results. Mining companies were often overseas-owned and a large proportion of profits went back to England. Conversely, many companies never found gold, went bankrupt, and overseas investors lost out.

Honourable Roddy

The heaviest nugget officially recorded is the 2.81-kilogram ‘Honourable Roddy’, found at Ross in 1909 and named after the Minister of Mines, Roderick McKenzie. It was gifted to King George V at his coronation in 1911. In the late 1950s enquiries to Buckingham Palace as to what had become of it received an embarrassing answer – it had been melted down to make a royal tea service.

How much gold and silver?

Up to 2003, about 538,640 kilograms of alluvial and 368,544 kilograms of hard-rock gold had been produced in New Zealand. The total value (in 2003 terms) was US$116.32 billion.

A few large operations were responsible for most of the hard-rock gold. The Waiuta mine near Reefton produced 62,369 kilograms of gold between 1870 and 1951. The Martha mine near Waihī produced 311,845 kilograms of silver and 141,747 kilograms of gold between 1880 and 1951. New Zealand’s total gold output in 2003 was worth over $200 million and is expected to increase.

Profitable grams per tonne

Gold-mining economics relies on the price of gold – if the price rises sharply even low-grade deposits (if they are large enough) become economic to mine. If it drops then only the richer areas of the mine will be worth mining. There is a lot of gold in the ground, but it is mixed with worthless rocks. For a mine to be profitable the cost of mining must be lower than the value of the gold won.

For alluvial deposits near the surface a payable grade can be considerably less than 1 gram per tonne. For hard-rock sources mined in opencast methods, such as at Macraes Flat, around 1.6 grams per tonne is just profitable at 2005 prices. (Most grades are higher – the Martha opencast mine averaged about 3 grams of gold and 26 grams of silver per tonne.)

Underground mines, such as Golden Cross, must have richer grades to justify tunnelling expenses – typically grades must be around 8 grams per tonne or higher. (The planned underground mine at Favona will work a rich deposit – 1.1 million tonnes of reserves at 10 grams of gold per tonne.)

Amateur fossicking

Gold prospecting and mining are strictly regulated, but for those interested in fossicking with only a pan, shovel and sluice box there are 16 areas set aside for this in the South Island.

Acknowledgements to Bob Brathwaite (GNS Science) and John Barry.

Hononga, rauemi nō waho

More suggestions and sources

How to cite this page: Carl Walrond, 'Gold and gold mining', Te Ara - the Encyclopedia of New Zealand, (accessed 16 June 2024)

He kōrero nā Carl Walrond, i tāngia i te 12 o Hune 2006