FONTERRA LIMITED. SUBMISSION ON A DRAFT WATER CONSERVATION ORDER for TE WAIKOROPUPŪ SPRINGS and ASSOCIATED WATERBODIES

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1 FONTERRA LIMITED SUBMISSION ON A DRAFT WATER CONSERVATION ORDER for TE WAIKOROPUPŪ SPRINGS and ASSOCIATED WATERBODIES To: Special Tribunal: Water Conservation Order for Te Waikoropupū Springs and associated water bodies c/- Environmental Protection Authority Private Bag Wellington 6140 Waikoropupu@epa.govt.nz Copy to: Ngāti Tama Ki Te Waipounamu Trust and Andrew Yuill c/- Rosie Hill Anderson Lloyd PO Box 201 Queenstown 9348 rosie.hill@al.nz SUBMITTER: Contact: Fonterra Limited Address for Service: Fonterra Limited c/- Brigid Buckley Policy and Planning Manager NZ Operations PO Box Avonhead Christchurch 8446 Fonterra Limited (14 March 2018) 1

2 Proposed Water Conservation Order for Te Waikoropupū Springs and associated water bodies Fonterra supports the proposed Water Conservation Order but seeks amendments. Fonterra wishes to be heard in support of this submission. If other parties make similar submissions, Fonterra would consider presenting a joint case with those parties at the hearing. Fonterra will not gain a trade competition advantage through this submission. Fonterra and a number of its shareholder farmers will be directly affected by the proposed Water Conservation Order. The adverse effects do not relate to trade competition or the effects of trade competition. Dated: For Fonterra Limited OVERVIEW OF FONTERRA S SUBMISSION 1 This is a submission by Fonterra Limited (Fonterra) on the application by Ngāti Tama Ki Te Waipounamu Trust and Andrew Yuill (the Application) for a Water Conservation Order for Te Waikoropupū Springs and associated water bodies (the Draft Order). 2 Fonterra owns and operates a milk processing site located in the lower Takaka catchment (the Takaka processing site). Fonterra shareholder farmers also own 36 properties in the Takaka area. 3 Overall, Fonterra recognises and is supportive of, in particular, the protection of Te Waikoropupū Springs. 4 Fonterra however seeks amendments to the draft Order on the basis that: 4.1 protection of some parts of the water bodies for which protection is sought is either not necessary to protect Te Waikoropupū Springs or would be more appropriately done through a Regional Plan; 4.2 insufficient recognition has been given to existing development in parts of the catchment such that they are no longer in their natural state and do not carry amenity or intrinsic values that make them outstanding; and 4.3 the water quality parameters identified for the associated water bodies are in some cases difficult to apply or not appropriate for a water conservation order framework. 5 Fonterra seeks that the Draft Order be amended on the basis of its overall submissions set out in Annexure 1 and the specific amendments set out in Annexure 2. Fonterra Limited (14 March 2018) 2

3 BACKGROUND Fonterra and its interests in the Takaka area 6 Fonterra Co-operative Group Limited is the world s largest processor of dairy products by volume and the largest dairy exporting company. It is 100% owned by around 10,000 New Zealand dairy farmers. 7 The New Zealand processing assets are owned and operated by Fonterra Limited (Fonterra). 8 Fonterra s interests in the wider Takaka area are divided between its processing interests and the farming interests of its farmer shareholders. Fonterra processing interests 9 Fonterra s owns and operates the Takaka processing site: 9.1 Fonterra s Takaka processing site is located to the north of Takaka township in the lower Takaka River catchment. It is downstream (or effectively out of catchment ) from the Te Waikoropupū Springs (refer Figure A) Figure A: Fonterra Takaka manufacturing site 9.2 the Takaka site holds various resource consents including: (a) (b) (c) the take of groundwater; the discharge of waste water and/or clean process water to the Takaka River; the discharge of stormwater; and Fonterra Limited (14 March 2018) 3

4 (d) the discharge of waste water and/or clean process water to land (noting that the land disposal area is outside of the Takaka River catchment). 10 The Takaka processing operation is one of three sites in Fonterra s Tasman/Marlborough area (the other two being Brightwater and Tuamarina (Blenheim)). Product export is largely though the Port of Nelson. Fonterra farming interests 11 Fonterra has 182 supplier farms in the wider Tasman/Marlborough area. Of these 36 are located in the Takaka area that will be potentially affected by the Draft Order. 12 In the Takaka area, Fonterra shareholder farms have an average farm size of 123 ha and an average herd size of 358 cows producing 1097 kg of milk solids per hectare per year. 13 Beyond the farm gate, dairying supports rural businesses in the region such as milk-product processing, rural retailing, farm suppliers, rural transport and agri-commodity cartage, seed production, ground and surface water irrigation services and rural consultancy. Fonterra and the environment 14 Land and water are essential resources to Fonterra and its farmers. Fonterra recognises that maintaining a healthy and functioning environment, including healthy waterways and water flow, is important for both an enduring and successful dairy industry and the wider community. 15 As noted in paragraph 9.2 Fonterra s Takaka site operates within a number of resource consents, including those to discharge processing wastewater to land and water, and to take water for use in the production of various milk products. There are extensive systems, processes and infrastructure in place to ensure environmentally sustainable outcomes are achieved. 16 Fonterra s internal environmental management system (which is ISO accredited), provides a framework for managing compliance with regional plan rules and consents (amongst other matters). The system s plan, do, check and review means that continuous improvement is built into a site s day-to-day activities, and opportunities for reducing its overall impact on the environment are constantly being identified, assessed and implemented. 17 As a part of its Takaka processing operations it is noted that Fonterra has a general preference for the discharge of waste water and/or clean process to land (outside of the Takaka River catchment). Discharge to the Takaka River is however a necessary practice during contingency events or when discharge to land is not able to occur. 18 On farm, Fonterra has developed the tools and capability through "Tiaki Sustainable Dairying" to deliver a package of continuous improvement initiatives that support Fonterra farmers to achieve best practice farm management, meet regulatory requirements, and satisfy customer and market expectations. 19 Of emphasis, Fonterra s: 19.1 Waterway Management Programme has seen Takaka area farmer shareholders permanently fence 100% of the length of waterways greater than 30cm deep and 1m wide on their milking platform, and have 100% of regular stock crossings bridged or culverted; 19.2 Nitrogen Programme requires all Fonterra farmer shareholders to provide farm information for estimating year-end nitrogen loss (and efficiency). In the 2016/17 season, 80.6% of farmers in the Takaka area participated and received personalised Nitrogen Reports; and Fonterra Limited (14 March 2018) 4

5 19.3 New tailored farm environment planning service will look to provide all Fonterra farmers with a live plan which identifies current good management practice as well as any environmental risk areas on farm with time bound actions to address the risks identified. As Fonterra continues to deliver tailored Farm Environment Plans, there is an opportunity to prioritise key catchments such as Takaka. 20 At a community level, Fonterra welcomes opportunities to partner and work in collaboration with other stakeholders towards collective environmental goals. Fonterra Limited (14 March 2018) 5

6 OVERALL SUBMISSIONS Annexure 1 1 Fonterra s overall submissions relate to the whole of the Draft Order. 2 Fonterra supports the Draft Order but seeks amendments. 3 Fonterra has 4 core and overall submissions to make on the Application: Submission Point 1: The waters included in the Draft Order 4 The Application seeks to protect three core water bodies: 4.1 Te Waikoropupū Springs; 4.2 the confined and unconfined Arthur Marble Aquifers; and 4.3 the Takaka River and its Tributaries. 5 Fonterra recognises the importance of protecting Te Waikoropupū Springs. Water bodies that contribute to the flows in Te Waikoropupū Springs should also be protected to the extent of ensuring water quality in the Te Waikoropupū Springs is maintained or improved. 6 Within the above there are two aspects in relation to Draft Order s geographic coverage and approach that require amendment: Area(s) to be excluded Lower Takaka River catchment and Plains 6.1 The lower part of the Takaka River catchment (as identified as Zone 3 in Annexure 3 to this submission) and associated water bodies do not contribute to the Te Waikoropupū Springs. There is also a relatively high level of development in this area (including farming, industrial users (such as Fonterra s Takaka operations) and an urban area. 6.2 Fonterra s primary submission is that this area does not meet the statutory test (as per section 199 of the Resource Management Act 1991) of being either: (a) (b) in its natural state (with associated outstanding amenity and intrinsic values) (s199(1)(a)); or in a non-natural state but with amenity or intrinsic that still warrant protection on the basis that they can be considered outstanding (s199(1)(b)). 6.3 Fonterra therefore seeks that the area identified be excluded from the Draft Order Takaka North 6.4 In Figure 1 to the Draft Order there is an area described as Takaka North. This area is outside of the Takaka River catchment and also does not contribute to Te Waikoropupū Springs. 6.5 It is not clear from the Application as to whether this area is intended to be included and subject to the provisions of the Draft Order. For the same reasons as those listed in paragraph 6.2 above, Fonterra seeks that it be excluded. Fonterra Limited (14 March 2018) 6

7 Area of limited influence 6.6 In addition to the area of exclusion, technical advice received by Fonterra (see Annexure 3) suggests that there is an additional area ( Zone 2 ) of the catchment that has only a very limited or no influence on water quality in the Te Waikoropupū Springs. 6.7 Fonterra has therefore provided further relief in Annexure 2 that provides for different levels of protection for different parts of Takaka River catchment (with its first preference that water quality limits in Schedule 4 do not apply or are less restrictive for Zone 2). This approach is consistent with, for example, the: (a) National Water Conservation (Rakaia River) Order 1988; and (b) National Water Conservation (Rangitata River) Order Both of those water conservation orders recognise and provide for existing and future activities in the lower parts of the Rakaia River and Rangitata River catchments. Only parts of the respective catchments are afforded a higher level of protection. 7 Should Fonterra s primary submission on the exclusion area ( Zone 3 ) as set out in paragraph 6.1 to 6.3 not be accepted then Fonterra seeks (as an alternative submission) that Zone 3 be treated the same as Zone 2. Submission Point 2: The appropriateness of Schedule 4 Limit Values 8 The combined effect of clause 9 and the limit values in Schedule 4 will be to prevent any increases in the concentrations of (for example) dissolved reactive phosphorus, and E.Coli, nor any decrease in visual clarity. Values for other indicators must also be maintained at levels far below NPS values. 9 Fonterra is concerned at the use of a single set of water quality parameters (or triggers) for the entire catchment (when in reality there is both differing water quality across the catchment and parts of the catchment that have a very limited or no influence on water quality in Te Waikoropupū Springs). 10 Schedule 4 as referenced in clause 9 of the Draft Application also explicitly refers to the discharge of contaminants onto land. It appears that the combined effect of clause 9 and Schedule 4 would be to exclude most land application treatment options for wastes onto farmland (a beneficial use of wastes and in Fonterra s view a much preferable use of such wastes than discharging directly to water). 11 Overall, Fonterra is concerned (for example) that: 11.1 there is currently insufficient data to determine, in particular, the appropriateness of the stated Schedule 4 nitrate-n limit of 0.4 mg/l. Fonterra considers that nitrate-n may be better addressed through a Regional planning process. It may also be the case that different limits need to apply to different parts of the catchment; 11.2 Schedule 4 also has numerical limits for ammoniacal nitrogen and dissolved oxygen (in addition to nitrate-n as per the above), but the limits for dissolved reactive phosphorus, E. coli and clarity are based on the status quo. It is unclear: (a) on the data available as to whether the other indicator levels (i.e. in addition to nitrate-n) are similarly achievable or reasonable. Further, the wording in Schedule Fonterra Limited (14 March 2018) 7

8 4 states do not exceed and this implies a maximum level and not the median. Schedule 4 should state that it is the median value; (b) (c) it is also not clear as to what the numerical values represent. Reference to the supporting document by Thomas and Harvey (2013) 1 indicates that, for nitrate-n at least, the value could be based on the median value for the Arthur Marble Aquifer but with limited data it appears that other values could apply to other parts of the catchment; and Fonterra considers that if Schedule 4 is to apply, it should only apply to the Te Waikoropupū Springs alone (with the discharges that may or may not be appropriate to determine those values being driven by appropriate discharge limits in a Regional Plan and not the Draft Order). In the alternative, should Schedule 4 apply to other parts of the catchment it needs to be revised to better reflect the concerns set out the status quo requirement for dissolved reactive phosphorus, E. coli and clarity will also exclude any discharge where the quality of the discharge is of poorer quality than the status quo. Such a requirement is overly onerous and cannot be met. Further, the assessment period is stated as from monthly data collected under all flow conditions. It is likely that the study data is instead based on the median from a much longer period (Thomas and Harvey, 2013, Figure 29). 2 Clarity is required as to the number of samples and time period over which they are collected. For some water bodies it is unlikely that there will be any data available as to the status quo levels; and 11.4 both Schedule 4 and Schedule 5 are described as limits or triggers. However, there are inconsistencies between the two schedules- particular for Ammonia and Nitrate, and further clarification is required. It is also unclear as to whether the ANZECC Guidelines for constituents such as Nitrate refer to Nitrate or Nitrate-nitrogen. (Note that the Schedule 4 Nitrate limit of 0.4 mg/l Nitrate-N is 1.8 mg/l Nitrate). 12 Fonterra therefore seeks: 12.1 For its primary submission, that Schedule 4 be revised to better reflect status quo water quality, the concerns raised above, and that it only apply to the waters in Te Waikoropupū Springs (on the basis that detailed water quality requirements for the wider catchment should be dealt with in a Regional Plan and not a water conservation order); 12.2 For its alternative submission that Schedule 4 be revised to better reflect status quo water quality, the concerns raised above, and that it is revised so that different and more realistic water quality parameters are provided for each of: (a) (b) (c) Te Waikoropupū Springs those parts of the Takaka River catchment that are likely to contribute to Te Waikoropupū Springs; those parts of the Takaka River catchment that are unlikely to contribute to Te Waikoropupū Springs (i.e. Zone 2 as set out in Annexure 3 or Zone 2 and Zone 3 if Fonterra s primary relief on geographic coverage is not accepted). 1 Thomas, J.T. and Harvey, M.M. (2013) Water Resources of the Takaka Water Management Area, Tasman District Council [Figure 26] 2 Thomas, J.T. and Harvey, M.M. (2013) Water Resources of the Takaka Water Management Area, Tasman District Council [Figure 29] Fonterra Limited (14 March 2018) 8

9 13 In the further alternative (especially in the absence of suitable data to determine appropriate water quality parameters), Fonterra seeks that Schedule 4 be deleted. It is emphasised that Fonterra remains supportive of good quality but considers that water quality is best addressed through a Regional Plan. Submission Point 3: Schedule 5 is not appropriate and should not provide values as hard limits 14 Schedule 5 of the draft Order is derived from guideline values in the Australian and New Zealand Guidelines for Fresh and Marine Water Quality (ANZECC Guidelines). 15 Fonterra has considerable experience in the use and application of the ANZECC Guidelines and is generally supportive of their application. It is however emphasised that the document sets out a global approach (i.e. one that is designed to be made specific in local circumstances and not applied universally), and it says so itself for example: The Guidelines do not signify threshold levels of pollution since there is no certainty that significant impacts will occur above these recommended limits 3 and Invariably, the process of refining these guidelines trigger values to local conditions will result in numbers for toxicants at least, that are less conservative and hence less constraining on surrounding activities The Guideline values are in some cases significantly more restrictive than the National Policy Statement for Freshwater Management 2014 and will not be able to be achieved in all water bodies. The levels of many of the contaminants in Schedule 5 will currently not be known for the Takaka River catchment (and in many cases Fonterra anticipates the stated trigger values will not be appropriate). 17 Further, it is noted that the ANZECC Guidelines give trigger levels for four different levels of species protection. Many of the parameters both in both the ANZECC Guidelines and in the Draft Application are listed as ID which is defined as Insufficient data to derive a reliable trigger value. The net result is that listing the parameters is meaningless until trigger levels are determined and the desirable level of protection is determined. 18 At a more practical level Fonterra is also concerned that: 18.1 the wording of clause 9 means that the trigger values are being treated as hard limits; 18.2 that any resource consent application for which an assessment is required against clause 9 of the Order will require an unnecessarily detailed water quality assessment to determine whether each trigger value has been exceeded or met; and 18.3 that the Guidelines themselves reflect an industry-based set of suggested default trigger values (that may in themselves be subject to amendment over time) and are not appropriate for a Water Conservation Order. 19 Fonterra therefore seeks that Schedule 5 be deleted accordingly. 3 Australian and New Zealand Guidelines for Fresh and Marine Water Quality, October 2000 at Ibid, Box 1.1. Fonterra Limited (14 March 2018) 9

10 Submission Point 4: Existing activities and consents in the draft Order 20 Clause 12 (especially when read in conjunction with clause 8) of the draft Order is unclear on exactly how currently permitted or existing activities (where existing use rights might apply) and existing consents are to be treated on renewal. 21 The approach in clause 12 can for example be compared with clause 8 the Water Conservation (Kawarau) Order 1997, which reads as follows: Replacement of existing consents The restrictions and prohibitions in clauses 3(5) and 4(5) and Schedule 2 do not limit the regional council s functions in respect of any part of the preserved or protected waters to replace any existing resource consent or grant any resource consent in substitution for an expiring resource consent if the new resource consent is granted on substantially the same terms and conditions as the existing or expiring resource consent. 22 Given the significant existing investment in parts of the catchment (in relation to for example Fonterra s processing assets and existing farming operations in the area), it is important that existing or permitted activities and consents are protected. 23 This amendment has been included in Fonterra s proposed amendments to the Draft Order, attached at Annexure 2 to this submission. 24 The amendment seeks to ensure that existing consents and existing or permitted activities that are existing at the commencement date are able to continue. Fonterra Limited (14 March 2018) 10

11 Annexure 2 specific submission points Please note that Fonterra s first four submission points are set out in Annexure 1. Table 1: Primary relief sought Submission point Section of WCO Support/Oppose Submission Decision sought 5 Interpretation Support with amendment Fonterra considers that only part of the Arthur Marble Aquifer and Takaka River and its Tributaries justify or merit protection by way of a water conservation order. The definitions of Arthur Marble Aquifer and Takaka River and its Tributaries need to be amended to be consistent with Fonterra s sought relief elsewhere in this submission. Amend the following definitions: Arthur Marble Aquifer means those parts of the aquifer identified in Schedule 1 underlying the Takaka Valley, South Island, New Zealand that are directly connected to the Te Waikoropupū Springs Upper Takaka River and its Tributaries means the upper part of the Takaka River and all its tributaries within the catchment identified in Schedule 3 that are connected to the Te Waikoropupū Springs 6 Clause 5 Waters to be preserved in natural state (and Schedule 1) Support with amendment to Schedule 1 Fonterra supports clause 5 to the extent that it protects those parts of the confined and unconfined Arthur Marble Aquifer that have a direct hydraulic connection to Te Waikoropupū Springs. Fonterra opposes the inclusion of that part of the catchment (in particular the Lower Takaka River referred to as Zone 3 in Annexure 3 to this submission) that does not contribute to the outstanding features, characteristics and values of the Te Waikoropupū Springs. Amend clause 5 so that it provides: 5. Waters to be preserved in natural state Because of the outstanding characteristics, features and values identified in Schedule 1 and the contribution made to waters supporting outstanding characteristics, features and values, to the waters identified in Schedule 2, the waters specified in Schedule 1 are to be retained as far as possible Fonterra Limited (14 March 2018) 11

12 Submission point Section of WCO Support/Oppose Submission Decision sought Due to the existing water quality and the extent of development in the Lower Takaka River area, Fonterra considers that the Zone 3 area in their natural state, subject to clause 12including but not limited to the clarity and quality of the waters, cannot be regarded as being in its natural state or as justifying protection for amenity and intrinsic reasons. Further, given that development has occurred in the areas that are hydraulically connected to the Waikoropupū Springs, reference to clause 12 (as also sought to be amended by Fonterra) is necessary. The additional text at the end of the notified version of clause 5 as notified does not assist in its application and can also be deleted. 7 Clause 6 Waters to be protected for their outstanding characteristics, features and values Support with amendment. Fonterra acknowledges the significance of Te Waikoropupū Springs, and fully supports their protection as provided for by clause 6. However, Fonterra wishes to ensure that only those waters established as directly contributing to the quality and quantity of water in the Te Waikoropupū Springs are protected under the Order. In particular, Fonterra seeks to ensure that existing development (in particular, its Takaka processing site, and farms throughout the Takaka catchment) are able to continue operating. Amend clause 6: Because of the outstanding characteristics, features and values identified in Schedule 2, the waters identified in Schedule 2 are to be protected so far as is possible in their natural state and in accordance with the relevant conditions in clauses 8 and 9, subject to clauses 10, 11 and 121. Fonterra also seeks to ensure that existing consents and activities are clearly provided for, by including reference to clause 12. Fonterra Limited (14 March 2018) 12

13 Submission point Section of WCO Support/Oppose Submission Decision sought 8 Clause 7 Waters to be protected for contribution to outstanding characteristics (and Schedule 3) Support with amendment As noted above, Fonterra supports the protection of Te Waikoropupū Springs, however it also seeks to ensure that waters that do not have the same unique characteristics and qualities, or that do not contribute directly to the characteristics of the Springs, are excluded from the Order. Therefore, Fonterra seeks that Schedule 3 be amended as set out below. Fonterra also seek to ensure that existing consents are clearly provided for, by including reference to clause 12. Amend Schedule 3 as set out in submission points 16 to 21 below. Amend clause 7: Because of their contribution to outstanding characteristics, features and values identified in Schedules 1 and 2, the waters specified in Schedule 3 are to be protected in accordance with the relevant conditions in clauses 8 and 9 subject to clauses 10, 11 and Clause 8 Restrictions on alterations of aquifer depth and form Support, subject to amendment. Fonterra supports clause 8, provided that clause 12 is amended to make it clear that existing takes are protected. As a number of water take consents in the region will be expiring around 2019, it is important that the rights to take water under these existing consents are protected (and these are not treated as new takes). Amend clause 12 as submitted at point 13 below, and amend clause 8: Subject to clause 12, no resource consent may be granted or rule included in a regional plan that (when compared to activities existing, permitted or consented at the commencement date of this order)- The wording in the notified version (that refers to (for example) not already authorised by a resource consent at the time this Order comes into force ) is also confusing when read against other clauses and in particular clause 12 that contemplate renewal of resource consents and certain permitted activities continuing. Transfers of water may also occur separate to the provisions of the Water Conservation Order (as per section 136 of the Resource Management Act 1991 and any relevant rules in the Regional Plan) and are not currently provided for. a. Will result in reduction of the width of the active floodplain of the Arthur Marble Aquifer or any other hydraulically connected aquifer. b. Will authorise any increase in the any additional abstraction of water from any part of the Arthur Marble Aquifer as specified in Schedule 1. not already authorised by a resource Fonterra Limited (14 March 2018) 13

14 Submission point Section of WCO Support/Oppose Submission Decision sought Fonterra considers it would be clearer if the beginning of clause 8 simply provided that Subject to clause 12 along with further amendments to remove any confusion around what is meant by (for example) not already authorised. consent at the time this Order comes into force. c. Will authorise any increase in the any additional abstraction of water from any part of the Te Waikoropupū Springs as specified in Schedule 2. not already authorised by a resource consent at the time this Order comes into force. d. Will authorise any increase in the any additional abstraction of water from any those parts of the Takaka River and its tributaries as specified in Schedule 3. not already authorised by a resource consent at the time this Order comes into force. Please note that Fonterra s submission assumes (as referred to elsewhere in this submission) that Schedule 3 is amended to exclude Zone 3 and only include those parts that are directly connected to Te Waikoropupū Springs. 10 Clause 9 Requirement to protect water quality (and Schedule 5) Support, subject to amendment. As explained in Annexure 1 submission point 4 and also at submission point 23 below, Fonterra opposes the use of the trigger values in Schedule 5 as hard limits, as this is not what the limits were designed for - and they do not take into account the local conditions. Fonterra is therefore seeking the deletion of Schedule 5. Amend clause 12 as submitted at point 13 below, and amend clause 9: Subject to clause 12, no resource consent may be granted or rule included in a regional plan relating to the discharge of contaminants onto land in instances where it may enter waters specified in Schedules 1, 2, and 3, that Fonterra Limited (14 March 2018) 14

15 Submission point Section of WCO Support/Oppose Submission Decision sought In addition, Fonterra seeks that clause 9 crossreference clause 12, so it is clear that existing resource consents and activities are protected. As a number of water take consents in the region will be expiring around 2019, it is important that the rights to take water under these existing consents are protected (and these are not treated as new takes). New consenting requirements may also arise for activities that are existing and currently permitted. will cause, either by itself or in combination with any existing consents, activities or rules, the limits specified in Schedule 4 after reasonable mixing. or the triggers specified in Schedule 5 to be exceeded. 11 Clause 10 Scope of order Support Fonterra supports clause 10 as it is essential that the order does not restrict the ability of farmers/landowners to take water for reasonable domestic and stock water needs under the RMA. Fonterra also supports the other matters listed in (b). Fonterra notes that (c) appears to be expressed in or could be read in absolute terms. Fonterra is supportive of the intent of the clause provided that what is referred to is avoiding activities that would materially compromise the protection of the outstanding characteristics and features identified (otherwise any effect even if minor or de minimis could arguable be read as compromising the values set out. Retain clauses 10 (a) and (b) as notified. Amend clause 10(c) such that it does not unduly or unintentionally restrict the activities contemplated under (b) (through for example including the word materially as set out in the Submission column to this table). 12 Clause 11 - Exemptions Support with amendment Like clause 10, this clause does not create a true exemption, because it maintains a requirement that the exercise of any consent granted under this clause must not compromise the protection of the natural state, outstanding characteristics and features for any of the waters specified in the Amend Clause 11: Nothing in this Order prevents the grant of a resource consent that would Fonterra Limited (14 March 2018) 15

16 Submission point Section of WCO Support/Oppose Submission Decision sought Schedules. Given the very broad protection proposed in the Schedules, it would be very difficult in practice to establish that a consent would not compromise the protection of any of these waters. Fonterra seeks that in addition to a reduction in the waterways protected by the Order, clause 11 should also be rephrased to create a more workable exemption. Please note that the position of the and between 11(a)(iii) and (b) needs to moved so that it is clear it applies to all of (a)(i) to (iii) and not just (iii). otherwise contravene conditions set out in this Order if: a. A consent authority is satisfied that: i. There are exceptional circumstances justifying the grant of a permit; or ii. The consent is for an activity that is associated with necessary maintenance works and structures not otherwise prohibited by this Order; or iii. The consent is for discharge of herbicides for control of pest plants; and b. The exercise of any such consent would not materially compromise the protection of the natural state, outstanding characteristics and features identified for the waters specified in the Schedules. 13 Clause 12 Existing consents Support with amendment Fonterra Limited (14 March 2018) 16 It is not clear from clause 12 and clause 8 how a number of matters are to be treated. This includes: Replace clause 12 with the following: 12. Replacement of existing consents and existing or permitted activities

17 Submission point Section of WCO Support/Oppose Submission Decision sought 1. the renewal/replacement of existing consents; 2. the transfer of existing resource consents; 3. permitted activities (or activities that have existing use rights); and 4. activities that are currently permitted that may require resource consent in the future. The approach used in (for example) the Water Conservation (Kawarau) Order 1997 creates a clearer approach that awards greater certainty to existing consent holders. This is particularly important in the context of water take consents that are due to expire around the time that the Order is likely to come into effect and can be adapted to also accommodate existing and permitted activities. It is important that the replacement of these consents and the continuation of all permitted activities is covered by clause 12. Fonterra considers that the Kawarau Conservation Order approach (with amendments as set out) is more appropriate. The restrictions and prohibitions in clauses 8 and 9 and Schedule 1, 2 and 3 do not limit the regional council s functions in respect of any part of the preserved or protected waters to: 1) Enable an activity existing and permitted at the date the commencement date of this National order to continue; 2) Transfer a resource consent if the transferred resource consent does not result in any increase in allocation or have any additional effects on water quality; and 3) Replace any existing resource consent or grant any resource consent in substitution for an expiring resource consent if the new resource consent is granted on substantially the same terms and conditions as the existing or expiring resource consent. 14 Schedule 1 - Waters to be retained in Natural State Support with amendment Fonterra supports the protection of those parts of the confined and unconfined Arthur Marble Aquifer that directly affect the quality of the Te Waikoropupū Springs. Fonterra does not support the extension of protection to those other parts of the Arthur Marble Aquifer (and wider aquifer system), that are not Retain and amend in conditions to apply : No abstraction with the exception of cl 8 (abstraction) and cl 12 (existing consents and activities) Amend Schedule 1 to only include those parts of the Confined and Unconfined Fonterra Limited (14 March 2018) 17

18 Submission point Section of WCO Support/Oppose Submission Decision sought likely to affect the quality of the Te Waikoropupū Springs. Arthur marble Aquifer that contribute to the Springs: Fonterra supports the exception for existing consents (clause 12) referred to in the conditions to apply. Waters Those parts of the Confined and Unconfined Arthur Marble Aquifer that are hydraulically connected to the Waikoropupū Springs, and which are illustrated in refer to map below Figure 1 below Amend maps as set out below, and include reference to the relevant Figure number rather than simply stating refer map below. 15 Schedule 2 - Protected waters Support Fonterra supports the protection of Te Waikoropupū Springs but considers that clause 2 needs to be amended to on the same basis as Schedule 1 (to refer to directly to Figure 1). Reference should also be made to clauses 8 and 12. Retain as notified, but include Figure reference so it is clear which map is referred to: Te Waikoropupū Springs, refer map Figure 1 below. Delete the reference to clause 8 (third column) and replace with: Fonterra Limited (14 March 2018) 18

19 Submission point Section of WCO Support/Oppose Submission Decision sought No abstraction with the exception of cl 8 (abstraction) and 12 (existing consents and activities) 16 Schedule 3 - Waters to be protected for their contribution to outstanding characteristics Support with amendment. Fonterra supports the protection of the upper Takaka River and its tributaries, to the extent that these are directly connected with, and contribute to the characteristics of, the Te Waikoropupū Springs. Fonterra is however concerned that the waterways currently listed in Schedule 3 are too broad, and it understands (based on the technical advice set out in Annexure 3) that only some of the waters in fact contribute to the characteristics and quality of water in the Te Waikoropupū Springs. Reference should also be made to clauses 8 and 12. Amend Waters : Upper Takaka River to its headwaters; and its tributaries, including the Waingaro Anatoki and the Waikoropupū Rivers, refer map below as shown in Figure 1 Delete the reference to clause 8 (third column) and replace with: No abstraction with the exception of cl 8 (abstraction) and 12 (existing consents and activities) Amend the reference to hydraulically connected groundwater: Hydraulically connected ggroundwater that is hydraulically connected to the waters specified in Schedule 2 not identified in Schedule 1 including parts of the Takaka Limestone Aquifer and Takaka Unconfined Gravel Aquifer refer map below. Amend maps as set out below, and include reference to the relevant Figure number rather than simply stating refer map below. Fonterra Limited (14 March 2018) 19

20 Submission point Section of WCO Support/Oppose Submission Decision sought 17 Figure 1 Takaka Water Management Area Support with amendment Only parts of the Takaka catchment and associated water bodies should be recognised by way of Water Conservation Order. Figure 1 should be amended to identify the parts of the catchment that are subject to protection. Replace Figure 1 with a new map based on that set out within Annexure 3 to this submission that excludes the Takaka North area (as shown on the existing Figure 1) and Zone 3 (as shown in Annexure 3) 18 Figure 2 Geology Takaka Water Management Area Oppose It is not clear why this Figure has been included in the Order, as it is not referred to in any of the clauses, and does not identify any protected waterways. Delete Figure Figure 3 Arthur Marble Unconfined Aquifer and Arthur Marble Confined Aquifer. Support with amendment. Parts of the Arthur Marble Aquifer do not influence the quality of waters in Te Waikoropupū Springs, and therefore those parts should be removed from the figure. Figure 3 should in effect be combined with the replacement for Figure 1 set out at submission point 17 of this submission (i.e. a new map based on that set out within Annexure 3 to this submission that excludes the Takaka North area (as shown on the existing Figure 1) and Zone 3 (as shown in Annexure 3)) 20 Figure 4 Takaka Limestone Aquifer Oppose It is unnecessary to identify the Takaka Limestone Aquifer separately, therefore Fonterra submits that it is not necessary to include within the Order. Delete Figure Figure 5 Takaka Unconfined Gravel Aquifer Oppose It is unnecessary to identify the Takaka Unconfined Gravel Aquifer separately, therefore Fonterra submits that it is not necessary to include within the Order. Delete Figure 5. Fonterra Limited (14 March 2018) 20

21 Submission point Section of WCO Support/Oppose Submission Decision sought 22 Schedule 4 Water Quality Limits Support with amendment Fonterra repeats the concerns set out in submission point 2 of Annexure 1 of this submission. Fonterra supports the imposition of water quality limits, however it is essential that these properly reflect the sustainable management of natural resources such that they are workable and continue to enable activities that do not prejudice the maintenance (and where necessary improvement in) water quality. It is also clear that there are parts of the Takaka River catchment (and aquifers) where no or different water quality limits may be appropriate. Further, it is also important that measurement takes into account elevated contaminant levels that occur naturally during flood conditions. Amend Schedule 4 (assuming that Schedule 4 does not apply to Zone 3 as set out In Annexure 3 to this submission given Fonterra s sought relief elsewhere in this submission) so that: it only applies to those areas that have a direct hydraulic connection to Te Waikoropupū Springs (i.e. Zone 1 as set out in Annexure 3); or in the alternative, there are different water quality limits for the areas described as Zone 1 and Zone 2 as set out in Annexure 3 (on the basis that less restrictive water quality limits should and can apply to Zone 2 as compared to Zone 1). In addition to the areas that Schedule 4 applies to, Schedule 4 needs to be amended so that: the concerns raised in submission point 2 to Annexure 1 to this submission are addressed (and so that the limits properly reflect existing water quality and provide some small or limited increases where appropriate to accommodate current activities and other activities of a minor nature that might be undertaken as a Fonterra Limited (14 March 2018) 21

22 Submission point Section of WCO Support/Oppose Submission Decision sought permitted activity in the future); and the method of measurement is workable and accommodating of extreme flow events that might otherwise skew the measurement of water quality parameters/limits. For example, the annual median of monthly samples might be more appropriate than monthly data collected under all flow conditions. 23 Schedule 5 Trigger values Oppose Fonterra opposes the content of Schedule 5, because it uses trigger values from national strategy documents as hard limits, a use that they were not designed for. The trigger levels proposed are generic triggers that do not take into account local conditions. The strategies and guidelines referred to are documents that evolve over time - it is not appropriate to fix the triggers as hard limits in a NWCO. Many of the waterbodies in the Takaka catchment have never been tested for the contaminants listed in Schedule 5. The imposition of such a broad and generic list of triggers would create an extremely difficult and lengthy consenting process for any activities in the catchment that may impact upon water quality. Delete Schedule 5 and all references to it in the order. Fonterra Limited (14 March 2018) 22

23 Submission ends. Fonterra Limited (14 March 2018) 23

24 Fonterra Limited (14 March 2018) 24 Annexure 3: PDP letter

25 PATTLE DELAMORE PARTNERS LTD 295 Blenheim Road Upper Riccarton, Christchurch 8041 PO Box 389, Christchurch 8140, New Zealand Tel Web Auckland Tauranga Wellington Christchurch solutions for your environment 26 February 2018 Ben Williams Chapman Tripp Dear Ben TAKAKA WATER CONSERVATION ORDER 1.0 Introduction Pattie Delamore Partners Limited have been engaged by Fonterra Limited to provide technical background information regarding the draft Water Conservation Order for Te Waikoropupu Springs (Pupu Springs) and associated water bodies, including the aquifers, the Takaka River and tributaries (the draft Order). This letter sets out a brief summary of the hydrogeological setting of Pupu Springs and the different hydrogeologic zones that occur within the area that has been proposed for the draft Order. 2.0 Hydrogeological setting Pupu Springs provide a key groundwater discharge point from a complex hydrogeological system. The total average discharge from the Springs is around 13,300 L/s, of which around 10,000 L/s is from the Main Spring and the remaining 3,300 Lis is from Fish Spring. A study by Stewart and Thomas (2008) indicates that the source of the Main Spring is dominated (74%) by groundwater that has infiltrated deeply into the Karst Uplands of the Arthur Marble Aquifer, with much smaller proportions originating from the Takaka River and the rainfall within the Takaka Valley. In contrast, discharge from Fish Spring is largely (74%) derived from shallow groundwater (within the Takaka Limestone and the Takaka Unconfined Gravel Aquifer) originating from the Takaka River as well as rainfall within the Takaka Valley. Whilst flow from Pupu Springs accounts for much of the groundwater that is recharged to the aquifer system, there is a component of groundwater discharge to offshore springs and coastal seeps. That offshore groundwater flow component is predominantly sourced from shallow groundwater with deeper groundwater in the Arthur Marble Aquifer mostly discharging to the Main Spring. In total, around 52% of the recharge to the shallow groundwater system discharges offshore. The Arthur Marble Aquifer is overlain by the Motupipi Coal Measures between the coast to around 5 km inland. The Motupipi Coal Measures are considered to be a largely impermeable formation, and therefore protect the underlying Arthur Marble Aquifer from landuse at the surface. As a result, where the Motupipi Coal Measures are present, there is limited risk to the groundwater within the Arthur Marble Aquifer. Where the Motupipi Coal Measures are not present (more than around 5 km inland from the coast), the Arthur Marble Aquifer is overlain by the Takaka Limestone and the Takaka Unconfined Gravel Aquifer. As noted above, the majority of groundwater within those formations discharges offshore and does not contribute to flow in the springs. C0.2502L001_WCO

26 Pcil) 2 CHAPMAN TRIPP - TAKAKA WATER CONSERVATION ORDER It is also noted that the lower reaches of the Takaka River gains water from groundwater, where springs originating from the Takaka Limestone occur. 3.0 Proposed hydrogeologic zones within the area covered by the draft Order Given the sources of flow to Pupu Springs, proposed changes to the area covered by the draft Order are shown in Figure 1. These areas split the area into three parts: Zone 1: Where appropriate limits in the draft Order should be focussed; Zone 2: An intermediate zone where any limits should be less restrictive than in Zone 1; and Zone 3: Where the draft Order should not apply. Zone 1 includes the area of the Takaka Freshwater Management Unit that is most likely to contribute flow directly to Pupu Springs. Therefore, the full protection of the Water Conservation Order should apply to that area. Zone 2 includes the area the Takaka Valley approximately downstream of East Takaka and a short distance beyond the extent of the confining Motupipi Coal Measures. In addition, Zone 2 covers the area east of the Waingaro River covered by alluvial gravels, downstream of the area of reported sinkholes at the upper end of Long Plains / Hannama Road. Groundwater in that area may contribute to flows within the springs, but it is likely that most of this groundwater discharges towards the coast and/or into the Takaka and Waingaro Rivers. Note that losing reach of the Takaka River extends from upstream to East Takaka. Therefore, providing the complete protection of the draft Order to those areas may not be appropriate as the Zone 2 area is unlikely to include a direct connection to the springs. An intermediate level of protection is therefore more appropriate. Zone 3 covers the area of the catchment that is unlikely to contribute flow to the springs. Given that the Takaka Limestone and the Takaka Unconfined Alluvial Aquifer discharge to both the springs and also to the coast, there will be a flow divide at a point between the coast and the Springs. Land use across the aquifers and groundwater use on the coastal side of that divide will not affect flow or groundwater quality in the Pupu Springs, and therefore those areas should not be part of the Schedule 3 water bodies. Not only is the Zone 3 area on the downgradient side of the Springs, the Takaka River is expected to form a natural hydraulic boundary to shallow groundwater flow within the Takaka Limestone and the Takaka Unconfined Alluvial Aquifer where they overlie the Motupipi Coal Measures and therefore represents a flow divide. On the coastal side (i.e. towards the north-east) groundwater within the Takaka Limestone and the Takaka Unconfined Alluvial Aquifer is unlikely to drain to the Pupu Springs. Therefore, Figure 1 shows a cautious and conservative definition of a Zone 3 area that can be excluded from the draft Order on that basis. 4.0 Bibliography Stewart, M. K., & Thomas, J. T. (2008). A conceptual model of flow to the Waikoropupu Springs, NW Nelson, New Zealand, based on hydrometric and tracer evidence. Hydrology and Earth System Sciences(12), Thomas, J. T., & Harvey, M. M. (2013). Water Resources of the Tasman Area. Richmond: Tasman District Council. WhcsneAleks COMCO_C03499 C03412_50uth klanra502_talclka 007_WOrk Repo,' lineletters C LCOI_WCO,docx, 26/02/2018

27 pcfp 3 CHAPMAN TRIPP - TAKAKA WATER CONSERVATION ORDER 5.0 Limitations This report has been prepared by Pattle Delamore Partners Limited (PDP) on the basis of information provided by the Draft Order and the publications stated in this letter. PDP has not independently verified the provided information and has relied upon it being accurate and sufficient for use by PDP in preparing the report. PDP accepts no responsibility for errors or omissions in, or the currency or sufficiency of, the provided information. This report has been prepared by PDP on the specific instructions of Chapman Tripp for the limited purposes described in the report. PDP accepts no liability if the report is used for a different purpose or if it is used or relied on by any other person. Any such use or reliance will be solely at their own risk. Yours sincerely PATTLE DELAMORE PARTNERS LIMITED Prepared by Reviewed and Approved by Neil Thomas Senior Hydrogeologist Peter Cal!ander Director chcsrvalobs C0.100_CO.199 CO3,112_Sou. Wand 50 2_Takalca 007_Werk \ Reporting \ Letters \ C l001 W[0.doc, 26/02/2016

28 C Takaka WCO 5: \C03412 \502VrakakaWCO.qgs,rgie Te Waikoropupu Springs 1 * Legend Water Conservation Areas 7A Zone 2 (intermediate zone) #.1Z Zone 3 (to be excluded) Approximate boundary between confined/unconfined AMA Takaka River km * Pupu Springs Approximate o n fdraft Order FIGURE 1: MAP SHOWING AREAS THAT COULD BE EXCLUDED FROM THE DRAFT WATER CONSERVATION ORDER (ZONE 1 ENCOMPASSES THE AREA OUTSIDE ZONES 2 AND 3). C M001_WCO_F001.DOCX PATTLE DELAMORE PARTNERS LTD