After the Mt Polley and Samarco tailings failures, there have been ongoing conversations about the benefits of filtered or dry stack tailings as the only way to eliminate the risk of catastrophic tailings failure. Mining companies would all like to see a similar risk reduction at their own project. However what mining companies don’t like is the capital and operating costs associated with dry stacking. The dry stack tailings processing cost and the transport cost are both costlier than for conventional tailings disposal and therefore would negatively impact on the overall value of the project. Obviously this reduction in value would get offset against an improved environmental risk and a better closure condition. So what’s a company to do?
In my experience when designing a new mining project, all mining companies at one point in time complete a trade-off study for different tailings disposal methods and disposal sites. Contrary to some environmental narratives, companies really do wish to know how the different tailings options compare because they would adopt the dry stack approach if it was the most advantageous method. The mining companies are fully aware of the benefits but the dilemma the company runs into is the cost and being able to somehow justify the technology. Complicating their final decision, companies also have options for reducing their tailings risk even if using another tailings disposal method and so the final decision can get very complex.
Often proponents of the risk analysis approach will use a risk-weighting approach to assign an expected economic cost to their tailings plans. For example, if the cost of a failure is $200 million and the risk is 0.1%, then the Expected Value is $200,000. The problem is that this is a theoretical calculation on an assumed likelihood of failure but in reality either the dam will fail or it won’t. So failure remediation money will be spent or it won’t be spent, it won’t be partially spent.
The degree of acceptable tailings risk therefore becomes a subjective factor. While implementing a dry stack may reduce the risk of catastrophic failure to zero, implementing a $100,000 per year monitoring program on a conventional tailings pond will reduce its risk. Implementing a $500,000 per year monitoring program would reduce that risk even further. Installing in a water treatment plant to enable periodic water releases may further lower the tailings risk. The company can look at different mitigations to keep lowering their risk, although recognizing that none of the mitigations would necessarily bring the risk down to zero. Finally the companies could compare the various risk mitigation costs against the incremental dry stack costs in order to arrive at an optimal path forward.
So the question becomes how low does one need to reduce the tailings storage risk before it is acceptable to shareholders, regulators, and the public. I don’t think the answer is that one must lower the risk down to zero. There are not many things in today’s world that have zero risk. Driving a car, flying in a plane, shipping crude oil by ocean tanker, having a natural gas furnace in your house..none of these have zero risk yet we accept them as part of living in modern society.
Environmental groups are always discussing ways of forcing regulators and mining companies to take action against the risk of tailings failure. This is commendable, however they generally fail to provide any guidance on what level of risk would be acceptable to them or to the public. It seems to be impossible for these groups to define what an acceptable risk is or provide any ideas other than the standard “shut down all mining” solution.
We know that in the long run mining is here to stay so we all should work together towards solutions. The solutions need to be realistic in order to be taken seriously and for them to play a role in redefining tailings disposal in modern mining. Dry stack may not be the only solution and we should be open to ways of improving the other tailings disposal methods so that companies have more low risk options available to them.
It’s been awhile since my last blog article. Work and other commitments seem to get in the way.
Smoking… we constantly hear about the negative effects of it. We all know of people that have died due to lung cancer or other smoking related causes. However we probably also know of people that have smoked their entire lives yet lived into their eighties. Regardless of that, there still is a push to get people to kick the smoking habit because it is better for them and their families. Short term pain for long term gain.
Let’s compare all of that with the concept of fluid tailings storage.
Tailings…those of us in the mining industry constantly hear about the negative effects tailings storage. We know of numerous mines that have had failures resulting in fatalities and catastrophic damage. However we also know of many mines that have used fluid tailings their entire operating lives without any incidents. Given the recent Samarco tailings failure, for me the question has now become whether the mining industry should kick the habit of fluid tailings storage despite no failure in many circumstances.
Quitting smoking requires real effort, some pain, a change in lifestyle, and an overall commitment to quit. It isn’t easy but generally pays off in the long run when you speak with those who have already quit. Similarly for the mining industry, moving away from fluid tailings storage requires real effort, some pain, a change in operating style, and an overall commitment to quit. It wouldn’t be easy but might pay off in the long run by avoiding major tailings incidents, less negative press, and fewer environmental permitting issues. No longer would the consultants and regulators be disputing factors of safety of 1.3 versus 1.5, when they could be discussing factors of safety of 5 or 10.
Just as quitting smoking brings relief to oneself and family, quitting fluid tailings storage may bring relief to stakeholders, shareholders, regulators, and mine management. They can all sleep better at night knowing there isn’t a large mass of fluid being restrained simply by a rockfill dam at a factor of safety of 1.5. Engineers say they can design dams that if built properly will be stable for the long term, and I tend to agree with this statement. However that is no guarantee for all tailings dams, the proof of which is major incident we seem to see regularly.
My bottom line is that no one wants to sit downwind of a smoker and no one wants to live downstream of a tailings dam. Perhaps it is time for the mining industry to kick the habit of using fluid tailings storage, regardless of cost and discomfort that it causes. Short term pain for long term gain.
Watching the television news in Canada these days, one sees the environmental opponents of the oil sands parading around with signs that say “Stop the Tar Sands”. One way to distinguish whether someone is for or against the oil sands is to see what terminology they use. Do they call them “oil sands” (i.e. pro groups) or “tar sands” (i.e.anti groups)? Personally raw bitumen seems more tar-like than oil-like so the enviro’s seem to have it right.
Going back many decades the oil sands were originally called the tar sands. I’m not sure when the terminology shifted, but in the mid-1960’s the first large scale mining operation was called Great Canadian Oil Sands (GCOS). I’m also not sure about the reason for the terminology shift from tar to oil, but maybe it was related to the fact that “tar” was considered something of low perceived value while “oil” was considered something of high economic value. Heck… look at what oil did for the economic situation of Jed Clampett on the Beverly Hillbillies. How about the show “Dallas” – lots of money and scotch drinking. We all wanted to discover an oil well in our backyard so perhaps at that time the term “oil” implied some level of elegance and prosperity.
These days when one sees the term “oil” in the news, it tends to be associated with negatives. We see oil references to rail explosions, pipeline ruptures, tanker spills, off shore platform leakage, fracing, greenhouse gas emissions, Middle East wars, and environmental protests. I don’t know if there is any intangible benefit in using the term “oil” to describe your product. Maybe there is actually some intrinsic harm in doing so.
Tar (or bitumen) on the other hand, is a molasses-like substance generally viewed by the public as a material used to repair our streets and patch our roofs. A tar spill is not going to flow anywhere; it will barely flow out of the tank it is held in. What is there not to like about tar?
So next time there is a protest with signs being held up to “Stop the Tar Sands”, the oil companies should shrug their shoulders and jump on the band wagon and say “yeah…tar…that’s us…what are you worried about?”. They should try to commandeer the term “tar” back from the protest groups since there is nothing wrong with tar.