Management and financing of post-closure liabilities

Authors: Bocking, KA; Fitzgerald, P Download Paper

DOI https://doi.org/10.36487/ACG_rep/1208_06_Bocking

Cite As:
Bocking, KA & Fitzgerald, P 2012, 'Management and financing of post-closure liabilities', in AB Fourie & M Tibbett (eds), Mine Closure 2012: Proceedings of the Seventh International Conference on Mine Closure, Australian Centre for Geomechanics, Perth, pp. 49-56, https://doi.org/10.36487/ACG_rep/1208_06_Bocking



Abstract:
At many mine sites, the implementation of planned closure measures will not result in the desired ‘walk-away’ scenario. After a mining company spends all their capital expenditures and completes their promised closure measures, they may still have ongoing liabilities and risks, which could vary from simple routine care and maintenance of the site to ongoing treatment of effluent to ‘risk costs’ associated with the potential for earthquakes or floods. Where such liabilities continue to exist after closure, it will be necessary to make definitive arrangements for the ongoing management of the mine site in the long term, if not perpetually. Such site management will carry costs, so it will also be necessary to have sustainable financing in place. It is clear that mining companies do not last forever; therefore the management arrangements and financing must be sustainably independent of the existence of the mining company. Many jurisdictions have provisions for closed mining properties to be ‘returned to the crown’. Where this occurs, the responsible government will also have to make similar arrangements for the long term management and financing of a portfolio of returned sites. This paper gives examples of post-closure liabilities and costs. It also discusses using risk modelling to estimate future costs and discusses alternative approaches for long term sustainable financing.

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