Leon GerberRio Tinto Research FellowCEPMLP, University of Dundee
Outline1. Overview2. What is mine closure3. Traditional mining approaches4. Why we do it differently5. How we do it6. What makes for good practice7. Recent example8. Further reading9. Questions
1. Overview• Mines only have a limited lifespan.• Upon end of life, operations must be consolidated and closed.• Includes all matters regarding structures, waste, residue deposits, water management, community relations etc.• The physical activities that are needed to close down a mine are relatively straightforward - Greater challenge today involves leaving a social and environmental legacy
2. What is mine closure?Two aspects: • Actions and measures “to leave a mine site in a condition which is safe and stable, limiting further environmental impact” after the end of the operations (whatever the causes of that end: natural depletion, sudden interruption due to economic reasons, etc.) • Land reclamation: to restore or rehabilitate the land “…affected by mining for further economic use…” (see Hoskin, 2005)
3. Traditional mining practice• Traditionally only two principal phases recognised in the typical mine project life cycle • exploration • construction & operation• Focus on the immediate requirements of the stage that was active at any particular time• Mining: precedence over other land uses • Abandoning the mine as soon as it ended its productive cycle • Closing remote mining towns together with the mines – ghost towns
4. Why we do it differently•Mining industry has embraced the concept of sustainabledevelopment•Growth of environmental awareness – peer review, NGO’s, society•Governments have also tended to impose stricter requirements onindustry – not only environmental but also economic reasons (EquatorPrinciples)•Spate of new mining developments in developing countries – learnfrom past mistakes•Closure ties in with CSR and community responsibility
4. Why we do it differently (2)Concept of ‘design-for-closure’• Relatively recent development• In 1983, the proposed Cinola Gold Mine located on the Queen Charlotte Islands off the coast of northern British Columbia was one of the first mine projects to be conceived using a ‘design-for-closure’ concept http://www.carc.org/pdfs/NMPWorkingPaper1BowmanandBaker.pdf http://www.anthonyhodge.ca/publications/Post_Mining_Regeneration.pdf• Now, good practice requires that the planning time-horizon be extended to encompass “design-, build-, and operate- for- closure.” http://www.icmm.com/page/9566
5. How we do itVarious concerns involved in the closure of mining, across the broadspectrum of sustainable development elements.• Visual and Aesthetics• Environmental• Financial• Social• Employment / labourAbove concerns addressed in mine closure plans:• Conceptual closure plan: development of a target closure outcome and goals – ideally developed and used during exploration, pre-feasibility, feasibility/design and construction• Detailed closure plan: milestones, detailed methodologies of achieving these, monitoring and validation processes - used continuously during operations & incorporated into decision making process• Decommissioning and post closure plan: Effective transition to closure
5. How we do it (1)Key Principles of Mine Closure Design• Prevention • mine closure plans to be approved prior to operations • inspection and strict control of measures towards closure throughout all of operative cycle, • stringent system of enforcement and sanctions, • adequate terms of prescription, • periodic review of the plan, etc.• Mine closure costs internalisation • Cradle-to-grave approach • Environmental financial assurance measures (EFA) - sureties (fidelity bonds, surety bonds, performance bonds and letters of credit); cash deposits • Typically guarantees environmental performance after closure• Reclamation & Rehabilitation
Exploration Conceptual closure planning Pre-feasibility Feasibility Construction Increasing Operations detail (Concurrent rehab) Detailed closure planning Mine life cycle Decommissioning Stakeholder inputReproduced from ICMM: Planning for Integrated Mine Closure Toolkit Transition to closure Closure Post-closure Relinquishment
5. How we do it (3)Preparation for practical closure Care & Reclamation / Closure / Postmaintenance Decommissioning Rehabilitation Relinquishment Closure
5. How we do it (4)• Design-for-closure• At early stages of mine development – pre-feasibility, feasibility and during assessment process (EIA and SIA): • initial post-closure concepts should be developed and estimates of post- closure costs made • financial instruments must then be identified• In construction and operation: these framework closure plans should progressively be reviewed and refined to produce detailed practical documents• In operation: progressive closure is also implemented where feasible• Decommissioning and active rehabilitation: • Nature of the long-term legacy is finally established• Post-closure phase: long-term management and monitoring of the property (passive care) • Final disposal of the site or ‘walk-away scenario’ or • Passive care in perpetuity
6. What makes good practiceMain elements of good practice in mine closure• Mine closure plan as a condition to start mining operations. Stress on pollution prevention• Inspection and control. Periodic review of the plan• Financial guarantees – or alternative mechanisms. Essential to achieve internalisation of closure costs• Sanction regime. Efficient enforcement and liability measures• Public participation at all stages of the development• Provisions on mine closure of small-scale mines• Provisions on abandoned mines. Distinction between mine closure and mine abandonment. Main policy to ensure mine closing (not abandoning)• Post-closure social and economic policies
7. Recent example(s)Scotsgold Resources, October 2011• Mining production of commercial gold and silver due to start in 2013• Loch Lomond National Park – major tourist attraction• Park authority’s board - opportunities for new jobs and economic growth outweigh concerns about the environment• Company should ensure long-term environmental impact will be minimised• Company intends restoration of landscape at end of 10-year licence• Company undertaken to provide a financial guarantee/restoration bond by means of Cash Collateral Account.
Country study - South Africa• Constitutional supremacy.• Myriad of legislation and regulations affecting mine closure. • Constitution of South Africa • National Environmental Management Act coupled with sectoral legislation • NEM: Integrated Waste Management Act • NEM: Protected Areas Act • Mineral and Petroleum Resource Development Act • Mine Health and Safety Act • National Water Act • Minerals Act• Standards for mine closure derives mainly from environmental prescriptions.• Large number of South African mines have reached maturity and is looking towards closure.
Constitution of the Republic ofSouth Africa 1996Section 24(a): “...everyone has the right to an environment that which is notharmful to his or her health and well-being”.
National Environmental ManagementAct, 1998• Section 2: “The costs of remedying pollution, environmental degradation and consequent adverse health effects and of preventing, controlling or minimising further pollution, environmental damage or adverse health effects must be paid for by those responsible for harming the environment”.• Section 28: Every person* who causes, has caused or may cause significant pollution or degradation of the environment must take reasonable measures to prevent such pollution or degradation from occurring, continuing or recurring, or, in so far as such harm to the environment is authorised by law or cannot reasonably be avoided or stopped, to minimise and rectify such pollution or degradation of the environment. * (includes an owner of land or premises, a person in control of land or premises or a person who has a right to use the land)
National Environmental ManagementAct, 1998• Sections 32: “...Any person or group of persons may seek appropriate relief in respect of any breach or threatened breach of any provision of this Act...”.• Section 33: Private prosecution in the public interest; or in the interest of the protection of the environment.Environmental Impact AssessmentRegulations Listing Notice 1 of 2010• Regulation 27(iv): “...activities, where the facility or the land on which it is located is contaminated...”.
Mineral and Petroleum DevelopmentAct, 2002• Provides a holistic cradle-to-grave approach to prospecting and mining.• Makes provision for economic, social and environmental costs to achieve sustainable development of SA mineral resources.• Section 38: Provides for the application of integrated environmental management and the responsibility to remedy.• Section 38(2): Makes provision to keep directors of companies or members of closed corporations liable for any damage, degradation or pollution caused by the company or closed corporation which they represent or represented.• Section 41: Makes financial provision for the remediation of environmental damage.• Section 42: Makes provision for the management of residue stockpiles and deposits.• Section 43: Provides for the issuing of a closure certificate.• Section 44: Provides for the retainment or removal of buildings and structures.• Sections 45: Provides for the Minister to take urgent remedial action pertaining to environmental degradation and pollution and to recover costs in this regard.• Section 46: Provides for the Minister to rehabilitate abandoned and ownerless mines/dumps and to register such sites in the title deeds of land and to transfer the liability for maintaining the rehabilitation work being undertaken to the responsible landowner.
Mineral and Petroleum DevelopmentAct, 2002The MPRDA, 2002 also provides for the implementation of a social and labour plan. The purpose and objectives of such plans are to:• Integrate and manage the social, economic and environmental impacts of mining within all the phases of a mine, until closure• Avoid job losses and mitigate social and economic impacts on individuals should a mine close prematurely or at the closure of mines• Avoid the establishment of settlements, which cannot be sustained after the closure of mines.
When things go wrong.. Floodingin KOSH•Four separate mines in close proximityin Klerksdorp, Orkney, Stilfontein andHartebeesfontein (KOSH area).•Dispute arose over responsibility forpumping of underground water aftermine closure.
Flooding in KOSH (continued)• Prior to closure, dewatering of mines conducted by each mining company at their own mine shafts. • Pumping is necessary to prevent the flow of underground water from mines at a higher location within the mining area to lower-lying mines.• On whose shoulders should the pumping responsibility lie when one mine closes down?• All mining companies and stakeholders agreed on the establishment of a water company.• Currently water continues to be pumped to the surface at the upper shaft, before being piped to the local water service provider – creating subsequent revenue stream.
8. Further Reading• International Council on Mining and Metals (ICMM) – Planning for integrated Mine Closure Toolkit http://www.icmm.com/page/9568/planning-for-integrated-mine-closure-toolkit• Financial Assurance for Mine Closure and Reclamation www.icmm.com/document/282• International Institute for Environment and Development (IIED) – Sets out sustainability standards, as applicable to mine closure http://www.iied.org/• International Accounting Standards Board (IASB) – Accounting and Disclosure Model for Extractive Activities http://www.ifrs.org/Current+Projects/IASB+Projects/Extractive+Activities/Summary.htm• Scottish gold mine receives approval http://www.ft.com/cms/s/0/7e722936-ff23-11e0-aa11-00144feabdc0.html#axzz1cLsU2lL5