Through collaboration and knowledge sharing, Australian mining can continue to protect the environment when projects close – and leave a positive legacy for communities.
The global mining industry is yet to fully understand the magnitude of failed mine site closures. Companies need to develop multi-disciplinary skills to better identify, measure and manage closure risks, and share learnings from successful and unsuccessful site closures.
That is the view of Katina Strelein, a principal mine closure consultant at SRK Consulting.
“Failed mine closures are a significant long-term risk for mining companies,” says Strelein. “Site-remediation costs can last decades or centuries, and be far greater than expected.”
Energy Resources of Australia’s (ERA) problems with rehabilitating the Ranger project area reinforce the risks in mine-closure planning. In October 2021, ERA announced “material” cost and schedule overruns in Ranger’s closure and rehabilitation.
Ranger is Australia’s longest continually operating uranium mine. Located on Aboriginal land and surrounded by (but separate) from Kakadu National Park, Ranger has been a complex project to close. Final site rehabilitation, at this stage, is expected by January 2026.
“Cost blowouts at rehabilitating Ranger should encourage the mining industry to increase its focus on mine-closure analysis and implementation,” says Strelein.
“Despite all the planning, ERA is still struggling to understand what is required to successfully close Ranger.”
Strelein recently wrote a paper on the early lessons of cost closure overruns at Ranger – Australia’s most studied mine on rehabilitation and closure.
“Ranger’s problems reinforce the complexities of understanding mine-closure risks, their potential costs and over what period those costs will be borne,” Strelein continues.
Other Australian mines have had closure problems. The old Mount Morgan gold mine in Central Queensland is predicted to generate acid mine drainage problems for up to 500 years. The mine’s full rehabilitation is expected to cost hundreds of millions of dollars, possibly more .
United States mines have also had closure problems. Some superfund sites (abandoned waste sites) have had problems because of misunderstood and managed geochemistry.
Strelein believes mine-closure risks will increase this decade. “A large number of mines built in the ‘80s and ‘90s in Australia will likely close this decade. Some could face very costly problems. The United States is ahead of Australia in terms of the increase in mine closures, and the early evidence suggests many mines there have had rehabilitation issues,” she says.
Strelein says companies can underestimate the complexities of mining-closure planning.
“Consider a mine that opened in the early ‘90s and will close this decade. Conditions are very different now than in the early ‘90s when the closure strategy was devised. The climate is changing, as are community expectations with site rehabilitation. It’s hard to know what will be required of a mine closure in 30 or 40 years’ time,” Strelein says.
Strelein believes the mining industry is still learning about site closure and rehabilitation. “Compared to other aspects of mining, mine-closure planning hasn’t been around that long. There’s a real opportunity for academic and industry research that contributes to the continued development of best-practice in mine closure and rehabilitation. Australia can be a leader in this field in the global mining sector,” she says.
Government regulation is another issue, says Strelein. “Governments and the global mining industry haven’t quite got their head around an agreed definition for closure criteria, or an agreed process for site relinquishment. Our industry would benefit from greater clarity on what constitutes a successful mine closure and rehabilitation.”
That is changing. The importance of understanding closure liability associated with a mine site is highlighted by the US Securities and Exchange Commission Rule S-K 1300, which came into effect in January this year. US-listed mining companies when reporting closure liabilities will be required to disclose any uncertainties regarding their proposed closure methodology and cost estimates.
Strelein believes this and other changes will lead to greater awareness and appreciation of mine-closure planning. She wants there to be more focus on community needs with mine closures.
“It’s not enough just to close a mine. We should strive to leave a positive legacy for communities. For example, repurposing open-cut pits to hold water for energy storage, and building renewables infrastructure that can power local communities,” she says.
The former Kidston gold mine in North Queensland, for example, is now being utilised as the site for the Kidston Clean Energy Hub combining pumped hydro energy storage system with solar and wind farms. The hub is currently under construction with completion of the project on track for 2024.
“Mine-closure planning is not just about minimising future risks and costs,” says Strelein. “Done well, it can identify commercial opportunities.”
SRK Consulting is a leading, independent international consultancy that advises clients mainly in the earth and water resource industries. Its mining services range from exploration to mine closure. SRK experts are leaders in fields such as due diligence, technical studies, mine waste and water management, permitting, and mine rehabilitation. To learn more about SRK Consulting, visit www.srk.com.
This article appeared in the December issue of Australian Resources & Investment.