What really happened at Pike River?

by Rebecca Macfie / 17 November, 2012
 Smoke billows from a ventilation shaft. Photo/Ross Setford

Failures at Pike River ran from the top of the regulatory and corporate hierarchy to the bottom, showing New Zealand has failed to learn from the mistakes of the past.

Eight of the men were working in the farthest corner of the mine. Glenn Cruse, Chris Duggan, Daniel Herk, Richard Holling, Brendon Palmer, Stu Mudge, Willie Joynson and Pete Rodger were building a development roadway to the northwest. Their crewmate Daniel Rockhouse had gone off down the mine to get some gravel. Conrad Adams was last seen near Spaghetti Junction, where the mine’s roadways and electrical and other services converged. Allan Dixon, Peter O’Neill and Keith Valli were on the hydro-mining machine that had been pressed prematurely into operation just weeks before.

Blair Sims and David Hoggart were doing maintenance, and Malcolm Campbell and Koos Jonker were servicing a continuous-mining machine. Josh Ufer and Ben Rockhouse were with Valley Longwall’s in-seam drilling rig, along with 17-year-old Joseph Dunbar, who’d gone underground for the first time that day on an orientation visit. He was due to start work the following Monday. Builders Michael Monk, Kane Nieper and Zen Drew were building a stopping, part of the vital ventilation infrastructure of an underground coal mine. John Hale was enroute to Spaghetti Junction, and Andrew Hurren and Francis Marden were preparing a sump area for concrete to be laid. Terry Kitchin, Milton Osborne and Sam Mackie were at pit bottom south, installing a water pipe. Riki Keane was at Spaghetti Junction trying to get a broken-down loader started. Daniel Rockhouse stopped to give him a hand before carrying on for his gravel.Russell Smith had run late for work that afternoon and was heading up the 2.3km stone tunnel. He and Daniel Rockhouse were the only ones who survived.

It could have been any other day underground at Pike River Mine. At 3.41pm on November 19, 2010, four McConnell Dowell men knocked off and left the mine for the day. Another four from Skevington Contracting and two surveyors left at the same time. A McConnell Dowell night crew of five was getting ready for work but had not yet gone underground. Other workers had been in and out of the mine throughout the afternoon doing various duties. If the 3.45pm explosion had been a few minutes earlier or later, the resulting death toll might have been even worse; the list of names carved on the modest and carefully landscaped memorial on Greymouth’s High St even longer.

Just outside Greymouth at the Paroa Hotel, owned by Bernie Monk and his family and from where he has led a determined campaign to get to the truth of what happened at Pike, there’s a sense of weary gratitude that the Royal Commission of Inquiry dug so deep to find the root causes of the tragedy that took the life of his son and 28 others. Gratitude – but not surprise. For anyone who sat through the weeks of public hearings, the commission has arrived at the only conclusions possible from the evidence: that the deaths of the Pike 29 were preventable, and were caused by failures that ran from the top of the regulatory and corporate hierarchy to the bottom. From the policymakers who oversaw the neutering of the mines inspectorate, through to Pike River Coal’s board of directors and senior management who couldn’t see the redflags of warning in front of their eyes, right down to the poorly led and inexperienced workforce. As Nick Davidson QC, lawyer for the families, said on the day the commission’s report was released, “everyone cops it” in the 400-page investigation.

Photo/David White

It could have blown any number of times

The commission’s findings make it clear that Pike could have blown any number of times in the weeks leading up to November 19. Methane levels had reached the explosive range (5-15%) 21 times in the previous 48 days, and had reached lesser, but still dangerous, levels a further 27 times. This and other vital information about safety hazards and breaches seems to have gone nowhere; been analysed by no one; resulted in no action.

A serious roof collapse occurred in the hydro-mining area just three weeks before the explosion, generating a pressure wave that knocked out a stopping, which directs the flow of air, and sent gas readings into the explosive range. It was a major warning sign that things were not well underground. The matter was reported internally, but on November 19 production manager Steve Ellis closed the file on it, noting there was only an “occasional” chance of it happening again and that there had been an “extensive investigation and recovery”. The commission, however, was unable to find any evidence of that investigation, and it wasn’t reported to the Department of Labour.

Angry cries for action had come from miners who recognised glaring holes in Pike’s safety management. On October 21, Dene Murphy filed a report demanding: “Get the dam [sic] ventilation sorted out so we can cut coal. This ventilation issue has dragged on for two and a half bloody years!!!” A few months earlier, Murphy had written a report demanding the appointment of a manager to take responsibility for the mine’s ventilation – something required by Pike’s own corporate documents, but never followed through – and threatening to complain to the mines inspectorate if nothing was done.

Experienced miner Brian Wishart wrote an email to his superior in April 2010 warning that the system to drain methane away from the coalface was inadequate. The Upper Big Branch Mine in West Virginia had recently exploded, killing 29 men. “History has shown us in the mining industry that methane when given the [right] environment will show us no mercy,” he wrote. “It is my opinion that it is time we took our methane drainage here at [Pike] more seriously and redesigned our entire system.” Stopgap measures were put in place, but the fundamental problem raised by Wishart was unsolved by November 19.

Had the Department of Labour been doing its job properly, Pike ought to have been shut down before November 19. Mines inspector Kevin Poynter – not to mention the men working underground – was concerned that Pike had gone into coal production without first meeting its legal requirement to establish a second means of exit. He knew that the 110m vertical ventilation shaft nominated by the company as its temporary emergency exit was completely unsuitable. Even under non-emergency conditions, those who tested it found it virtually impassable.

Poynter pressed Pike for details on when it would build a proper emergency exit and was told it would be months away. He wasn’t happy, but worried that if he served a prohibition notice, Pike would contest it and the department would lose. “He favoured a voluntary compliance approach,” observes the commission. This was a mistake: the company was taking no decisive action to meet its legal obligations, yet was preparing to move into production with the hydro-mining system, which was known to carry unique risks. The Department of Labour should have acted “decisively”, serving a prohibition notice that would have stopped work until this and other issues were sorted out, says the commission. Under-resourced, adrift in a generalist government department where there was little specialist knowledge of mining, and with a patchy understanding of what was really going on at Pike, the inspectors “assumed the mine was compliant and indeed that Pike was a ‘best practice’ company”.

Pike's board cops severe criticism

But although the Government has apologised to the Pike families and Kate Wilkinson has given up the Labour Minister portfolio as a gesture of accountability, Pike’s former corporate governors have merely tried to deflect any responsibility for their part in the disaster. They come in for excoriating criticism from the commissioners, who say the board’s “focus on meeting production targets set the tone for executive managers and their subordinates”. Chairman John Dow’s attitude was that “things were under control, unless told otherwise”, says the commission. “This was not in accordance with good governance responsibilities.” Coupled with the approach taken by senior managers, this attitude “exposed the workers at Pike to health and safety risks”.

The commission points to two major warning signs in 2010 that an “alert” chairman and board “would have found very revealing”. One was a comprehensive report by Hawcroft Consulting on behalf of Pike’s insurers. It rated Pike’s health and safety management systems as average or above, but said risk assessment was of a “below average/low standard”. Hawcroft raised a raft of concerns about the assessment of risks as the mine moved into production mode, including methane drainage, roof collapses and strata management. The board knew about the review, but didn’t read it. Dow said it was a matter for management.

The second was an audit that Dow himself had initiated after a contractor sought him out to express concerns about the workplace culture at Pike. In turn, Dow approached mining expert David Stewart, who conducted a detailed review that identified a list of serious problems with safety systems, including ventilation structures, gas monitoring, inadequate methane drainage and the absence of a second exit. But Dow considered Stewart’s work to be a matter for management. He didn’t ask to see the results of the audit, and the board’s health and safety committee (which hadn’t met for 13 months at the time of the explosion) didn’t receive or consider Stewart’s report.

When the board did consider health and safety matters, it focused on the wrong indicators, observes the commission. Instead of developing a comprehensive system to assess the management of critical risks such as methane, it focused on such things as lost time injuries, which were virtually no use in understanding the risk of a catastrophic event such as an explosion. For instance, there was no system to analyse near misses or the effectiveness of critical systems such as gas monitoring and ventilation.

Dow took the view that health and safety were the ambit of the health and safety manager and the mine manager. If other managers wanted to raise safety issues with him, they were able to do so, “for example, at company dinners or barbecues”. He felt neither the board nor its health and safety committee needed to seek further information or independent advice on health and safety, and assumed if there were problems, managers would raise them. The nearest the Pike board got to questioning management on safety issues was four days before the explosion, when general manager Doug White attended a board meeting and reported that methane management was “more a nuisance and a daily operational consideration than a significant problem or barrier to operations”.

Dow likened the difference between the governance role of the board and the operational duties of management to the separation of “church and state”. “The commission does not accept that analogy. Management operated under delegation from the board. Good governance required the board to hold management strictly and continuously to account,” says the commission. The board needed to have a “company-wide risk framework and keep its eye firmly on health and safety risks. It should have ensured that good risk-assessment processes were working throughout the company. An alert board would have ensured that these things had been done and done properly.” Former directors Dow, Stuart Nattrass and Ray Meyer have rejected the commission’s criticisms, releasing a written statement saying they “disagree with any suggestions that the board did not act appropriately”.

Flames flare from a shaft. Photo/Iain McGregor

Pike faced other major problems

The commission notes that the board and senior management had other pressing matters on their minds by 2010. “Coal production was years behind schedule, and previous estimates of production capacity had to be severely reduced. Lack of revenue was driving the company to seek further funding. There were major problems with the advent of hydro-mining, the company’s main production method.” Further, no one on the board had any underground coal mining experience, the business was effectively a start-up with no other source of revenue and there was a revolving door of senior managers through the business (including six mine managers in the two years before the explosion). There was a hefty reliance on consultants and contractors (the man in charge of managing the contractors was, himself, a contractor), morale was poor, absenteeism was a problem and some key machinery Pike bought had turned out to be completely unsuitable.

Pike’s credibility in the financial markets was under serious strain. It needed to press ahead with coal production to generate revenue, and in July 2010 the company decided to bring in a bonus system to provide an incentive to workers to get the hydro-mining system up and running by September. Despite having just raised $50 million in new capital, by June it was forecasting a $5.8 million cash shortfall. Dow emailed the board to say the $2.3 million cost of the worker bonus was “worth paying …to retain short-term market credibility”.

But when hydro-mining started on September 19, Pike’s ventilation and gas monitoring systems were not ready – and the company’s own external consultants had told it so. For instance, in August Hawcroft emailed Pike’s then general manager, Peter Whittall, saying it was “unfortunate” that the company was beginning hydromining when many of the risk-control systems were still being developed and were “not yet implemented”. Japanese hydromining expert Masaoki Nishioka pleaded for hydro-mining to stop until the new ventilation fan was installed and commissioned (but mining wasn’t paused until after the bonus target had been achieved).

After Nishioka left Pike in mid-October – he told the commission he feared an explosion – no one on Pike’s staff had experience in hydro-mining. But the company pressed on, although it struggled to get acceptable volumes of coal from the face. Twenty-four hour shift work was introduced in a bid to lift production, and the area being mined by the hydro system was significantly widened. The October 30 roof collapse occurred soon after. Nevertheless, Whittall – by then chief executive – told Pike’s shareholders at the annual meeting on November 15 that he was “very pleased with the way the process has gone. There have been no significant issues and the hydro system cuts and flows through the coal production plant as it is supposed to.” In fact, says the commission, Pike’s rush into hydro-mining was poorly managed, it had inadequate geological knowledge of the conditions, and the coal extraction “should have been suspended” until ventilation, gas and strata-management problems were solved and a second exit constructed.

Comprehensive failure

In chapter after chapter, the Royal Commission’s report describes the evidence of comprehensive failure at Pike. Where Pike had boasted to the world that it had a state-of-the-art, real-time gas monitoring system, just one of the key fixed gas sensors was working at the time of the explosion – and it was not hooked up to the control room alarm system. There were at least 14 recorded incidents of workers bypassing machine-mounted gas sensors by, for instance, taping plastic bags over them or blowing air across them. One miner reported that he believed workers overrode the sensors “out of frustration” because of the poor standard of equipment at Pike and the need to get the job done.

One worker wrote a report pleading for management to “find out how and why, and stop people from overriding safety circuits”. Although miners are supposed to be withdrawn if methane levels reach 2%, workers at times stayed underground even when gas levels reached the explosive range of 5% – conditions when a single spark would be enough to cause ignition. There was an attitude of “indifference”, says the commission. Health and safety manager Neville Rockhouse had developed a pile of health and safety paperwork, but most of it was still in draft by November 19, and “commitment from others was lacking. The board and executive management did not lead the process.” The health and safety department was “marginalised” and under-resourced, and Rockhouse didn’t have a strong mandate to influence the company.

More than 230 workers have died in New Zealand coal mines since 1879. Pike was the worst mining tragedy in this country in almost 100 years. And the commission says recurring themes underlie each disaster: an insufficient regulatory framework, a health and safety regulator not doing proper inspections, operators not identifying and managing hazards, inadequate training and equipment, and miners not following safe practice. New Zealand has failed to learn from the lessons of the past. “The lessons from the Pike River tragedy must not be forgotten. New Zealand needs to make urgent legislative, structural and attitudinal changes if future tragedies are to be avoided,” it concludes. “That would be the best way to show respect for the 29 men who never returned home on 19 November 2010, and for their loved ones who continue to suffer.”

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