💰 NZ Gold Royalties: How We Gave Away Billions for Almost Nothing

💰 NZ Gold Royalties: How We Gave Away Billions for Almost Nothing

And which governments let it happen.

By Nigel Gray 9 August 2026

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New Zealand has been exporting gold for decades.
What most people don’t know is this:

We charge some of the lowest gold royalties in the developed world — often less than 1% of the gold’s value.

This article explains how that happened, who set the rules, who failed to fix them, and how much money New Zealand lost by not charging a fair royalty like Norway’s 20% model.

1. Before 2013: NZ Charged Almost Nothing for Its Gold

From 1991 to 2013, New Zealand didn’t charge a percentage royalty at all.

Instead, we charged a tiny fixed fee per tonne of rock mined:

Tier 1 mining permits: about $3.50 per tonne

Tier 2 permits: about $1.50 per tonne

This system was created under the Crown Minerals Act 1991, passed by the National Government (Jim Bolger).

It didn’t matter:

how much gold was in the rock

what the gold price was

how much profit the mining company made

The result?

NZ captured about 0.1% of the gold’s value — effectively nothing.

And here’s the kicker:

No government changed this system for 22 years.

Not National.
Not Labour.
Not anyone.

2. 2013: The “Modernisation” That Still Captures Almost Nothing

In 2013, the Key Government updated the royalty system.

The new rules were signed by Simon Bridges, Minister of Energy & Resources.

They came into force on 1 January 2014.

The new royalty formula:

1% of net revenue, or

5% of accounting profit,

whichever is higher.

Sounds better, right?

It wasn’t.

Because mining companies can deduct almost everything — exploration, processing, transport, admin, depreciation, rehabilitation, losses carried forward — they almost always report low profit.

So they pay the minimum:

1% of net revenue.

In practice, NZ still captures 0.6–1.3% of the gold’s value.

3. Which Governments Failed to Fix This?

Every single one since 2013:

National (Key, English) — no change

Labour (Ardern, Hipkins) — no change

Coalition (Luxon) — no change

Not one government has increased gold royalties, despite:

record gold prices

record extraction

foreign ownership

offshore profit repatriation

public revenue collapse

4. How Much Gold NZ Extracted (2010–2024)

New Zealand typically produces 150,000–250,000 ounces of gold per year.

Known precise years:

2023: 220,000 oz

2024: 213,000 oz

Across 2010–2024, NZ extracted roughly:

≈ 3.0–3.5 million ounces of gold.

5. What That Gold Is Worth

Value at extraction-year prices:

Average ~US$1,600/oz
→ US$5.1 billion

Value at today’s price (2026):

~US$2,400/oz
→ US$7.7 billion

6. What NZ Actually Received in Royalties

Across 2010–2024:

≈ NZ$120–140 million total.

That’s 1–2% of the gold’s value.

7. What NZ Would Have Received Under Norway’s 20% Royalty Model

Norway charges 20% on oil and gas — no deductions, no loopholes.

If NZ had applied a 20% royalty to gold:

Extraction-year value:

US$5.1b × 20% = US$1.02 billion

Today’s value:

US$7.7b × 20% = US$1.54 billion

Actual NZ royalties:

≈ US$70–85 million

Total loss to NZ taxpayers:

NZ lost between US$950 million and US$1.45 billion 
NZ$1.6–$2.4 billion in today’s money

This is money that could have funded:

hospitals

schools

infrastructure

disaster recovery

a sovereign wealth fund

gold reserves

regional development

debt reduction

Instead, most of the profit was exported offshore.

8. The Blunt Truth

New Zealand has been giving away its gold for decades.

Before 2013:

We charged $3.50 per tonne — less than 0.1% of value.

After 2013:

We charged 1% of net revenue — still less than 1% of value.

Across 34 years:

No government fixed it.

Total loss:

Billions.

If a New Zealander walked into a jewellery store, paid 1% of the price, and walked out with a ring, they’d be arrested.

When foreign mining companies do it, the government calls it “investment.”