Extending the life of mine beyond its life as a mine

Tom Butler, CEO of the International Council on Mining and Metals

The last thing on the minds of workers at the oldest-known mine on archaeological
record some 43,000 years ago in Swaziland was what their mine might become long
after their tools had been put away.

Fast forward to today, and the transformation from active mine to mine closure is a
C-level business consideration with just as many consequences as traditional mining
decisions such as mine planning, development and geology.

For Tom Butler – CEO of the International Council on Mining and Metals – ensuring
that mines have alternative uses post closure is an essential step in building and
maintaining a company’s social license to operate.

“The mines being built today are markedly different from those built not so long
ago. The relationships that have been built with host communities are generally
better and environmental performance much improved, but there is still lots to be
done on building stakeholder and community relations.

“I think we need to take much more of a partnership model than we have done in the
past. That means developing projects from the outset in a spirit of true partnership
with surrounding communities, local government, and other economic actors,” said the
CEO of International Council on Mining and Metals (ICMM).

The Council is meeting in Melbourne to coincide with IMARC, where over half of
ICMM’s member CEOs will be speaking and sharing their perspectives on mining and the
global sustainability issues facing the industry.

“It is the first time ICMM’s Council has met outside of Europe or the United States,
and we recognise Australia as a centre of influence and excellence in responsible
mining. Fourteen ICMM company members operate 190 mine sites in Australia,” said Mr
Butler.

According to the ICMM, responsible mine closure requires the active participation of
local communities in the planning and implementation of actions, so that lasting
benefits can be recognised.

Communities and local businesses grow up with dependence on the mine operation and
the ceasing of operations has flow-on economic and social impacts. Thus, closure
planning should be incorporated into the early stages of project development and
operation.

As detailed in a 2016 report by the Mineral Policy Institute, Australia alone has
431 operating mines, 1,373 historic mines and 50,000 abandoned mines scattered
across the country. For Butler, designing alternative uses for those mines is a
concrete example of how miners can engage in a partnership with local stakeholders.

Examples of this approach are varied in their uses and location:

* Rainforest: Located in Cornwall, England the Eden Project was a china clay pit
for over 160 years. The project is now a popular tourist destination and research
centre dominated by two huge enclosures that house thousands of plant species,
including the largest ‘indoor’ rainforest.

* Art galleries and health centre: the sister Wieliczka and Bochnia salt mines
in Poland began operation in the 13th Century. Now UNESCO World Heritage Listed,
both mines feature hundreds of kilometres of galleries with works of art,
underground chapels and statues sculpted in the salt. The mine also houses an
underground post office, restaurant, cinema, tennis court, and sanatorium which
offers allergy and asthma treatment.

* Amusement Park: Salina Turda is a converted salt mine in Turda, Romania – one
of the world’s oldest, with historical references dating back to as early as 1075.
It ran as a working mine to 1932, when it became a facility for storing cheeses
and then a bomb shelter. In 1992 it was transformed into an underground amusement
park that features an amphitheatre, mini golf, ping pong tables, basketball
courts, a bowling alley, a Ferris wheel and a carousel to name a few.

* Hotel: Currently under construction the InterContinental Shanghai Wonderland,
located in the Sheshan Mountain Range about 50 kilometres from the city centre
will become the first five-star hotel to be built in a quarry featuring extreme
sports facilities and underwater rooms.

For Butler, these examples are just the tip of the iceberg but require equal buy-in
from all stakeholders involved.

“Engaging in a true partnership – a partnership of equals – means being willing to
give up a degree of control. The mining industry has not always been good at this in
the past. I think we will need to adjust our approach on that score,” said Mr Butler
who will be presenting on Mining’s current and future contribution to sustainable
development at IMARC later this year.

Risk of losing social licence to operate

The 2017-2018 ‘top 10 business risks facing mining and metals’ survey published by
professional services firm EY, ranks the loss of social license as one of the
biggest risks to the industry today alongside cyber, resource replacement and
digital effectiveness.

Butler agrees but with the nuance that gaining social licence for a new mine is
often an equal if not greater challenge.

“Social licence – or community acceptance – spills over into societal acceptance
which the industry needs if it is to continue to obtain finance, build projects and
access markets on reasonable terms,” says Mr Butler.

Organisations may be investing millions of dollars in sustainability and community
investment initiatives, but there needs to be a shift from a reactive and
compensation model of social investment to one that is far more strategic and
collaborative.

“ICMM’s approach is to provide a non-competitive space for 27 CEOs of the world’s
leading mining companies, and their teams, to discuss this and other challenges.

“We have made great progress over the 17 years since our founding, in terms of
enhancing environmental and social performance. However, society’s expectations
continue to evolve, which means that we, and the industry, need to be ready to
continue to evolve as well,” said Mr Butler.

Looking forward, the ICMM is setting aspirational goals and moving into a more
collaborative mode to address them. On the back of this year’s Council meeting in
Melbourne, the organisation and its members will be collaborating with mobile
equipment manufacturers to improve safety and to reduce diesel particulate and
carbon dioxide emissions.

“We are developing three-year stakeholder engagement (plan) on critical topics, such
as closure and community engagement. And we will continue our efforts to communicate
better about what we and our members are doing to address these challenges, in a way
that engages society,” finalised Butler.

Hear from Tom Butler and more than 250 mining leaders at IMARC at the Melbourne
Convention & Exhibition Centre 29 October to 1 November 2018.

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