May 24, 2018
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Dam burst threatens Canada mines over environmental concerns

By Christopher Donville and Liezel Hill, Bloomberg

VANCOUVER, British Columbia — A dam failure that sent billions of gallons of mine waste flowing down a British Columbia creek threatens to put a chill on new mining projects across Canada.

The Aug. 4 accident at Imperial Metals’ Mount Polley copper-and-gold mine led the local district authority to declare a state of emergency amid concerns about drinking water and the fate of millions of migrating salmon. Provincial government officials are at the mine, about 248 miles northeast of Vancouver, and are testing local rivers and lakes for contamination.

The dam breach has been stabilized and the waste isn’t acidic, Vancouver-based Imperial said in a statement the day after the accident. The company is trying to investigate the spill and mitigate its effects, it said Thursday.

Whatever the cause or final outcome of the accident, it’s already bad news for the mining industry, which accounts for about a fifth of Canada’s exports. Mines trying to obtain permits in British Columbia will now be scrutinized much more closely, Adam Low, an analyst at Raymond James Financial Inc., said in an interview.

“This will, I think, cause everyone in government across the country to re-examine policies,” Bill Bennett, the province’s minister of energy and mining, told reporters Aug. 6.

Bennett, who has ordered Imperial Metals to stem the pollution still flowing from its breached dam, said he’s “losing sleep” over the potential for a similar accident at any of about 20 mines currently operating in British Columbia.

Mount Polley isn’t unusual in taking waste from ore processing — known in the industry as mine tailings — and storing it in a pond or lake. Nor was this week’s accident the first of its kind: The failure of a tailings dam at a Boliden AB mine in Spain in 1998 caused huge environmental damage.

Tailings management was already a focus for regulators. Vancouver-based Taseko Mines Ltd. had its proposed New Prosperity copper and gold mine in British Columbia rejected by the federal government in February over concerns about its impact on a lake. Taseko said at the time it disagreed with the decision. No one at the company was immediately available for comment about the implications of the Mount Polley accident.

Pretium Resources Inc. is evaluating its Brucejack gold- and-silver project in the northwest of the province, which would cost $663.5 million to build. While Pretium expects greater regulatory scrutiny of its tailings plan, it doesn’t expect that to delay Brucejack, Chief Development Officer Joe Ovsenek said Thursday.

The Vancouver-based company plans to put half the project’s tailings underground and the rest in a lake, which, unlike Mount Polley, won’t have a dam, he said.

Canadian and British Columbia mining regulations are among the most stringent and comprehensive in the world, said Angela Waterman, the vice president for environment and technical affairs at the Mining Association of British Columbia. This week’s accident is “an anomaly,” she said.

“There are more than a thousand active or dormant tailings facilities in Canada and the last significant dam breach was more than 20 years ago,” Waterman said.

British Columbia’s environment ministry said Thursday that preliminary results from testing water in Quesnel Lake, downstream from the breach, met provincial and Canadian quality guidelines. It kept local restrictions on drinking and bathing, pending further testing.

Canada’s westernmost province is the country’s largest exporter of coal and biggest copper producer, according to the Mining Association of British Columbia’s website. Nationally, the mining industry contributed C$52.6 billion of gross domestic product in 2012, according to data compiled by the Mining Association of Canada.

For many people there’s little confidence that either the provincial or federal governments are doing enough to protect the environment, said Craig Orr, executive director of the Coquitlam, British Columbia-based Watershed Watch Salmon Society.

“When something like this happens people are completely overwhelmed and public confidence plummets even more,” he said, referring to Mount Polley.

It’s too soon to say what the long-term implications of the dam breach will be for the mining industry, said Pierre Gratton, the Mining Association of Canada’s chief executive officer.

“We have to wait to learn a little bit more about what happened and why before anyone rushes to conclusions as to what could have been done to prevent it and what regulatory instruments might be modified or changed to address it,” Gratton said by telephone.

There will now be more attention paid to how mining companies deal with managing their tailings, said Dirk Van Zyl, a professor of mining engineering at the University of British Columbia in Vancouver. Regulators will spur mining companies to look for ways to remove as much moisture as possible from their tailings, he said in a telephone interview.

No one at Imperial was immediately available for comment on how it managed tailings at Mount Polley.

British Columbia is proceeding with an investigation into the cause of the breach. Bennett, the energy and mining minister, said lessons from the accident will be applied to other mines in this province.

The accident “gives us the best reason a person could have to really take a step back and make sure what we’ve been doing in the past hundred years in this province is adequate and we’ll be doing that,” he said.


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