Leon Gerber

Rio Tinto Research Fellow

CEPMLP, University of Dundee

1. Overview

2. What is mine closure

3. Traditional mining approaches

4. Why we do it differently

5. How we do it

6. What makes for good practice

7. Recent example

8. Further reading

9. Questions

Outline

• 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

1. Overview

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

•Mining industry has embraced the concept of sustainable

development

•Growth of environmental awareness – peer review, NGO’s, society

•Governments have also tended to impose stricter requirements on

industry – not only environmental but also economic reasons (Equator

Principles)

•Spate of new mining developments in developing countries – learn

from past mistakes

•Closure ties in with CSR and community responsibility

4. Why we do it differently

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

Various concerns involved in the closure of mining, across the broad

spectrum of sustainable development elements.

• Visual and Aesthetics

• Environmental

• Financial

• Social

• Employment / labour

Above 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

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

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Reproduced from ICMM: Planning for Integrated Mine Closure Toolkit

5. How we do it (3)

Care & maintenance Decommissioning

Reclamation / Rehabilitation

Closure / Relinquishment

Post Closure

Preparation for practical 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 practice

Main 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

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.

7. Recent example(s)

• 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.

Country study - South Africa

Section 24(a): “...everyone has the right to an environment that which is not harmful to his or her health and well-being”.

Constitution of the Republic of South Africa 1996

• 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 Management Act, 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 Assessment Regulations Listing Notice 1 of 2010

• Regulation 27(iv): “...activities, where the facility or the land on which it is

located is contaminated...”.

National Environmental Management Act, 1998

• 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 Development Act, 2002

The 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.

Mineral and Petroleum Development Act, 2002

When things go wrong.. Flooding in KOSH

•Four separate mines in close proximity

in Klerksdorp, Orkney, Stilfontein and

Hartebeesfontein (KOSH area).

•Dispute arose over responsibility for

pumping of underground water after

mine closure.

• 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.

Flooding in KOSH (continued)

• 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

8. Further Reading