The Importance of a Socially Accepted Mine Closure Plan

Featured Image: ICMM

The mining industry is a significant contributor to a lot of countries’ GDP, but it has the potential to also be a great contributor to their sustainable development. It is still an extremely rare occurrence to see mine closure plans as early as the design phase since most companies are focusing mainly on attracting investors, establishing location, employment as well as procurement, in the early phases of any mining project. Although data about the physical and chemical key components which are vital to the closure plans are available even from the feasibility stages, most of the social impact is still analysed only  in the late stages of operations i.e. 2 to 3 years before the mine closure.

The conversion of natural resources into forms of social capital, used as a strategy to change the general perception of stakeholders about the mining sector is increasingly adopted, especially by large corporations. Their policy can drive good practices at the end of the mine-life, especially where the country itself has a good governance structure. How mining companies approach mine closure, especially on a social level, is equally important for the sustainable development of mining jurisdictions. Mine closure plans should be designed to become an efficient and sustainable aid to the collective use, with a long-term outcome in mind. Various reports suggest that if a land cannot be easily restored to the original physical state there are a lot of available scientific and engineering tools to understand what are the best nearest alternatives in such case that minimal impact upon the native communities would occur. Socially, inquiring about the expectations, requirements, and needs of the people at the end of the mine-life is a great tool to determine the short-term social and economic impact of the mine closure, but usually this action is not thought-off at early stages of development. Fortunately, there are a lot of bilateral and unilateral NGOs that offer their assistance in the regions were mining operations are coming to an end, and there is a wide area of resources brought together by these NGOs, the mining companies, and the government to make sure that the closure plan is not finalised hastily, and not disregarding the needs of the community.

The process of transitioning a community, a region, or even a country from a mining economy to a post-mining economy needs to be mediated by company and government alike, representing a shared responsibility between the two. So, what do governments need to do, to make sure that communities around mines approaching their closure stage are not impacted negatively at the end of the mine-life?

Particularly in the former Soviet states and some African states the ratification or change of the mine closure framework is or had been taking place in the last years. Mostly is done to provide some aid for their mining jurisdictions to cope better with mines closing, and it seems that this fast-growing trend is boosted by the increased focus on the ESG principles. Organizations like the World Bank and the ICMM are routinely involved in their proceeds to shift to a more socio-economical approach. For communities that have a local development plan there should be no difference between what the community wants and what the community need,  since the both short-term and medium-term economical strategies should align, in order to provide a responsible and sustainable transition towards a post-closure economy.

A good governance, in terms of mine closure, seems to revolve around engagement between various stakeholders, such as the government, the host communities, the employees and their unions, the shareholders and the company. All these parties need to understand how important a proper closure is, for the sustainability of the project. Having a plan of closure, with clear requirements, methodologies and acceptable practices, as well as prioritizing the bond refund and lease relinquishment, as a part of the mine-closing plan, and making it an import part of the  process is essential for the plan to perform optimally. The ICMM Revised Mining Closure Practice Guide encourages governance frameworks and good practices in mining companies, in order to reach effective engagement with all stakeholders early in the closure planning process. This and the continuous community engagement throughout the mine-life, in such a way that realistic expectations for the direct and indirect economic replacement of benefits of the mine post-closure would be great tools to assure a smooth transition. By increasing the level of stakeholder engagement and transferring ownership of the overall closure plan to the people that will remain in the area, the chance of leaving a positive legacy increases, as the economy in the area shifts to a less mining-centered distribution.

Innovative and strategic planning in mine-closure is not uncommon, but it mostly exists at mine site level and is rarely thoroughly documented. Initiatives such as the Sustainable Minerals Institute, at the University of Queensland, Australia is trying to promote the knowledge-exchange between companies, and to give insight on further necessary steps to improve mine closure performance.  For example, one of the most important tools in the feasibility stage as well as in the operational one - the MPV analysis - does not provide a clear understanding of how the mine closure will impact the community socially as well as economically. Hence, the Australian Institute advises a social dimension to be integrated further into the mine closure planning, in order to have a clear understanding of the effects post-closure, on all the stakeholders.

Another good practice found in many reports, is to prepare the host communities for a self-sufficient economy at the end of the mine-life by developing a programme to do so during operational phase. Initiatives such as the Host Community Procurement Programme were instated in some mining areas to build the sufficiency and the strength of the community around the mine. A constant iteration that closure will inevitably happen, as well as defining a closure vision and objectives as per the ICMM Guide are frequently used techniques for a sustainable mine closure.

The inclusion of social dimensions in the mine closure planning is ultimately the best innovative strategy to consider the demands of all stakeholder involved in the mining projects, from start to finish. Mine closure plans should be designed in order to be of efficient and sustainable use to the post-mining community, with a long-term plan in mind. If a land cannot be easily restored to the original physical state, there are a lot of available scientific and engineering tools to understand what the best nearest alternatives in such case are. The only thing left is for mining companies and governments to universally accept that the social dimension of a mining project is as important as its environmental aspect and treated as such.

Alexandra Comaniciu

References:

ICMM Plan Integrated Mine Closure Toolkit 2008.pdf. (n.d.).

Social Aspects of Mine Closure - Sustainable Minerals Institute - University of Queensland. (n.d.).

License to operate remains top mining risk, with high-impact risks a close second | EY - Global. (n.d.)

Sustainable social transitioning at mine closure: a paradigm shift. (n.d.).

ICMM. (2019). Integrated Mine Closure Good Practice Guide 2nd edition. In Theoria, Beograd (Vol. 60, Issue 4).

Price Waterhouse Coopers. (2007). Financial reporting in the mining industry, International Financial Reporting Standards 2007 (Issue June).

Stacey, J., Naude, A., Hermanus, M., & Frankel, P. (2010). The socio-economic aspects of mine closure and sustainable development: Literature overview and lessons for the socio-economic aspects of closure-Report 1. Journal of the Southern African Institute of Mining and Metallurgy, 110(7), 379–394.