The Tailings Dam breach at the Mount Polley Mine is likely the worst mining disaster that this province has seen and it could be getting worse. If the salmon and trout stocks of Quesnel Lake are impacted on their spawning journey to Quesnel Lake and feeder streams, then not only this year’s run but the runs from this year’s spawning of salmon and trout could be lost.
There are abandoned mines in BC and this is especially true with copper mines that have gone acid and leaked into rivers and lakes for years. An example would be the possible reopening of the Tulsequah Chief mine on the Iskut river and the Johnny Mountain mine. The latest mine approved by government, Red Chris, has in the Environmental Assessments Final Report a statement that on closure, the tailing pile would likely turn acid and would have to be treated in perpetuity.
On Mount Polley mine, one of the concerns is the issue of Hazeltine Creek. The massive tailings flow widened the creek to ten times its size, so when the creek returned to its usual size, a massive area of tailings will be left containing heavy metals.
While the news is that the water in Quesnel Lake is safe to drink, this is preliminary and taken soon after the release. If there is any danger of sulphides anywhere along the creek, then the area could become acid. Mines can become acid over many years and acid mine drainage is known as a “forever problem”.
From the evidence before us, this dam failure did not have to happen. While Imperial Metals must take responsibly for the ultimate dam failure, a host of government failures contributed to this mining disaster. The lack of clear responsibilities. A lack of inspection and monitoring by government branches. Allowing companies to be self-regulating. A lack of adequate budgeting and staffing, which would enable those who should be responsible to do their job.
[quote]Adequate monitoring and enforcement of certified projects is not occurring and follow up evaluations are not conducted. We also found that information currently provided to the public is not sufficient to ensure accountability.[/quote]
In its Feb 10, 2011 report, “The problems with BC mining regulations”, the University of Victoria’s Environmental Law Centre noted the EAO’s lack of field presence coupled with its lack of a viable compliance and enforcement strategy are further challenges.
To the effective enforcement of provincial EA conditions, moreover – although the 2009 EAO user Guide provides that inspections may be undertaken where appropriate – government staff report successive budget cuts have had significant impacts on their enforcement capabilities and they do not consider the enforcement of EA certificates to be within their mandate.
While we are being told by the minister that Imperial Metals applied for an adjustment to their certificate to lower the water level in their tailings pond and it brought them into compliance, it certainly did not solve the issue. We are told by the former tailings pond foreman that he consistently warned the mine managers that their were problems with the height of the dam walls and the amount of water. He was ignored and finally quit.
There are too many questions unanswered, too many allegations of government and company ignoring concerns. The only way to resolve this issue and arrive at the truth is to have a full judicial inquiry where people testify under oath. A joint review enquiry being suggested will not bring out the truth.
The public should demand a full judicial inquiry.
Past Chair – Environmental Mining Council of BC
Member – Advisory Council on Mining
One day, in 1863, Mr. Byrne decided to take a stroll to get a little bit of Liverpool air. As he ambled down the street he went past Mr. Boadle’s flour factory. To his considerable surprise and horror, flying out of the window on the second floor, came a barrel of flour which fell upon Mr. Byrne, knocked him to the ground, inflicting on him grievous bodily injury.
Mr. Byrne, a tad upset by all of this, decided to sue Mr. Boadle.
When the case came to court, Mr. Boadle’s lawyers argued that there was no evidence of negligence. After all, no one had seen the barrel of flour come out of the window so how can anybody tell what in fact had happened? Mr. Byrne, said Mr. Boadle, had to prove negligence and all he could show is that somehow, God only knows how, a barrel of flour had fallen out of a window and hit him on the head. That, said Mr. Boadle, was scarcely proof of his negligence.
Somehow, the learned judges hearing the case, were not impressed with this argument.
Res ipsa loquitur
Shorn of the Latin and legalese, essentially they said, “How the hell else could this have happened?” Barrels of flour don’t usually fall out of second-story windows on people walking down the street. Mr. Byrne was given damages. (If you happen to be interested, the legal doctrine is called “res ipsa loquitur”, or in English, “the thing speaks for itself”.)
How does this relate to the Mount Polley catastrophe, you might well ask – I’m sure that was on your mind!
Well there is now considerable argument as to whether or not anybody was negligent in the breaching of that dam, if so who it was, and how could you prove it anyway? Mr. Byrne would be able to answer that question easily.
There is no need to concern oneself about who is liable here – those who own and run the dam and those who have a duty to inspect that dam and make sure that it was kept in proper repair. That is the barrel of flour in this case.
Investigation designed to fail
Somehow Premier Christy Clark and Minister Bill Bennett have never read Byrne v. Boadle. They are flopping about talking about investigations – announced at an appalling press conference earlier this week.
By careful but not very clever design, the “independent” engineering inquiry from the outset exonerates Mr. Bennett’s and Ms. Polak’s ministries. When you look through the 14 recommendations, there is one that faintly suggests that the commissioners might want to look at the regulatory regime surrounding this disaster. There is no mandate to do so and it is not any more than a casual comment. Moreover, none of the commissioners have any expertise to look at this aspect of the matter.
I don’t mean this in unfairness to the commissioners – I don’t know the gentlemen, but their credentials with respect to mining seem impeccable. But to check into the regulatory obligations of ministries and whether or not they have been fulfilled requires a lawyer or a judge.
Bigger than Mount Polley
There must be, of course, a full and independent investigation. It is not simply the Mount Polley case with which we are concerned here.
There are not only countless other dams in the province but a number of other edifices which are under statutory scrutiny by the government of British Columbia and one or more of its ministries. The fact that no other dam has burst for awhile has nothing to do with it (though there have been no less than 46 “dangerous or unusual occurrences” at tailings ponds around the province from 2000-2012).
Dams don’t burst very often, the Saints be praised, but when they do, all hell breaks loose. It’s rather like tankers full of bitumen or LNG hitting something, or a pipeline bursting, isn’t it, when you think about it?
No one out for an afternoon fishing, a couple of weeks ago, would have predicted that the dam was about to burst. That’s why there are government regulations. Dams sit there for a long time without looking like they’re going to burst.
Being part of the Environment or Mines ministries, in the regulations department, is rather boring work. Nothing much happens. It’s pretty easy to assume that since nothing much is happening but nothing much will.
Now, it is not the good and skillful people that work within these ministries who assume that nothing will happen. Quite the opposite, their training is to know that something will happen sometime and their job is to prevent it.
No, it’s the idiots that run the ministries and politicians whose only concern is that catastrophes happen other than when they are in charge.
That’s why Mount Polley disasters happen.
Government’s regulatory failure is key issue
What is irrelevant, at this point, is how much damage this has all cost. Now, don’t get me wrong, it’s appalling to think of the consequences of this. I only say what I say because that is a separate issue which will have to be dealt with separately. As a man who’s been a lifelong opponent of capital punishment, I must say I could change my mind if I could catch the people who destroy our precious salmon and our God-given environment. That, however, as I say, it is not the point I’m going on today.
Today we must find out why our government and those who run it failed so utterly in their duty and what we must do about it. Remember, there is evidence that the ministry staff did indeed point out defects and ordered that they be corrected. There is evidence that the company simply failed to do what it was told to do.
A lack of enforcement
If that indeed happened, it means that there was a lack of enforcement. Lack of enforcement, be it fish farms, independent power projects, or dams inevitably points the finger at the politician. You cannot expect the companies to behave anything other than like companies. Their job is to make money and to explain away terrible things that happen by saying they’ll never happen again.
However, it is the bounden duty of those we elect to enforce the law.
We will never know all the answers until somebody of considerable talent and learning can stand back from this and investigate the entire matter going back to that day in 2001when industry began to get a free ride from its new friends in government led then by Gordon Campbell, now by Christy Clark.
Frankly, we’re looking at a judge. Anybody else will simply not have enough credibility with the public.
Minister should have resigned
Minister Bennett ought to have instantly resigned, not because of any personal negligence but because the time honoured rule is that if a ministry fails in its fundamental duty, it is the minister who must run up on his own sword. Unhappily, we don’t seem to pay much attention to these little rules anymore. I say unhappily, because the essence of good government is that the minister for each and every ministry is “responsible” for the actions of that ministry.
This doesn’t mean, of course, that if one of his employees did something naughty, that the minister would be responsible. It does not mean that the minister must resign any time his ministry makes a mistake. To err is human.
No, we’re talking about the failure of a ministry to do its fundamental and in this case statutory duty.
It is remarkable to me, as one who has been in the BC Cabinet, the casual attitude being betrayed by the government in general. I recognize that Mr. Bennett is losing sleep and that the Premier wants to make the lake just as pretty as it used to be and promises to do so.
There is, however, the huge question of Public Duty involved and that is simply not being addressed. Either we have a government where there is ministerial responsibility or we do not. Evidently the answer is we do not.
If we, the public, don’t take this seriously, even if it means a little serious philosophizing about what governments are supposed to do, then we will deserve to have this kind of government forever.
A series of anecdotal reports of illness from suffered by people in close proximity to the Mount Polley Mine tailings dam breach is prompting a local First Nation to push the premier for a study of potential airborne contaminants – and calls for an independent inquiry into the still-unfolding disaster.
“I was very sick”
Sylvia Palm is a 40-year resident of Likely, BC. Her home, near Cedar Point Park on Quesnel Lake, is 5 km northeast of Hazeltine Creek, where debris began flowing out of Polley Lake after Imperial Metals’ tailings dam burst on August 4.
At that moment, early in the morning, Palm was sleeping upstairs with the doors and windows wide open, to keep cool from the summer heat. Later that BC Day, as water and sludge from the breached pond rushed towards Quesnel Lake, she she began to realize “something wasn’t right.”
[quote]By 1 pm, I started to feel burning and irritation in my eyes and nose.[/quote]
Palm knew she had to get out of town. By 3 pm, she had left the Likely area.
She would return on Wednesday, only to pack a few things in order to relocate to her sister’s, some 20km away. She spent the evening in the house, this time with the doors and windows closed.
“When I woke up, I was very sick,” Palm recalls. “My eyes were sore, my nose was burning, and I had this intense headache concentrated in my forehead – unlike any I’ve ever experienced.”
That morning, she left to stay at her sister’s, where she remains today.
[quote]As soon as was I out of the area, things began alleviating quickly, but it was a full 48 hours before I felt remotely normal – although I wouldn’t say that I’ve felt truly normal since.[/quote]
Film on the water
After spending the next four days at her sister’s, Palm returned home for just an hour a day on Monday, Tuesday and Wednesday of this week. She went back mainly to take water samples, photos and video of her property. “Every time I go back, I feel my face burning in my nose membranes and eyes,” Palm says.
What she saw was troubling. She observed browned foliage on mountain ash, hazelnut trees and poplar. She also captured the video below of a pail of water drawn from her underground spring. She is in the habit of filling a pail with the frigid water and leaving it outside to warm up before watering her plants with it. Thus, the pail in the video was exposed to the open air on her property from August 7th – the day she left for her sister’s – to the 13th, when the video was taken.
What it shows is a milky film on top of the water:
Just a few days earlier, documentary filmmaker Jeremy Williams recorded an oily film on top of the water flowing down Hazeltine Creek, near the mouth of the breached dam. Williams, who has done lots of documentary work in the region in recent years, headed there with his camera soon after he learned of the disaster.
Besides filming the physical devastation, Williams interviewed a number of locals who described to him experiencing a range of symptoms – from nausea and vomiting to burning eyes and respiratory difficulties – while attending the site in the early hours and days following the dam’s blow-out (watch for video of these interviews in the coming days).
Filmmaker feels the burn
Williams himself experienced short-term health effects during and following the approximate 1 hour he spent on Hazeltine Creek, near the dam, on Friday, August 8.
According to him, “a small amount of water was still cascading from the rupture area, so some of the water was airborne through mist.” In that short time, he developed a headache and his eyes started to burn.
[quote]After leaving the area, I noticed my lungs feeling weak, like I couldn’t catch my breath.[/quote]
It took 2 days for Williams’ breathing to return to normal, while the burning sensation in his eyes lingered for a day and a half.
[quote]Attempting to fall asleep last night, I kept asking why I did this to myself. I have never felt like I did after being exposed like I was last night. I was so ill that I wrote a list of symptoms, not expecting to be able to remember. They included: vomiting, dry heaving, upset stomach, dizziness, motor control delays, continuous blurred vision, throbbing and hot cheeks, heavy eyelids, pain in and around the eyes, lethargic in action and thought, blacking out of vision, tiredness, and headache.[/quote]
Clow would later add, “You don’t need a white lab coat to understand that this is poison. The smell here makes your vision blur and gives you a headache.”
“They should be testing for airborne contaminants”
Rick Holmes is a Registered Professional Biologist whose company, Cariboo Envirotech, acts as the local Soda Creek First Nation’s Mining and Mineral Exploration Coordinator. Though he wasn’t at the site at the time of the initial incident, he too received numerous reports of a strong smell in the air at the time.
After listening to a number of community members’ concerns, Holmes feels it’s high time for the provincial government to begin studying potential air impacts from the disaster.
He told me that his client, Soda Creek First Nation, sent a letter today to the premier, urging such steps.
[quote]They should be testing for airborne contaminants as soon as possible. [/quote]
Holmes’ concerns are compounded by the drying out of parts of the flood zone in recent days, which he fears could lead to more airborne contaminants when the debris caked onto trees and the banks of Hazeltine Creek turns to dust.
At 9 pm Wednesday, he emailed Jennifer McGuire, Executive Director, Regional Operations for Environmental Protection at the Ministry of Environment, asking: “Are investigations of the impact of airborn contamination being undertaken? I noted in my flight of the area 2 days ago that considerable sized areas were drying out and I’m wondering if contaminated dust is being broadcast.”
“Additionally is it safe for cleanup crews to be handling the wood debris without dust masks at the very least? Are gloves sufficient…what about protective clothing…do the contaminants get absorbed by the skin through clothing or by not wearing gloves?” Holmes asked, regarding community members who have been engaged to perform initial cleanup work.
At 8:30 this morning, McGuire wrote back:
[quote]The ministry is aware of the emerging dust issue related to the breach. Arvind Saraswat – the Ministry Air Quality Section head and former Air Quality meteorologist in Williams Lake – is working on assessing the dust situation and will be providing information/direction to the company regarding suppression and mitigation needed. Arvind will be in touch with you.[/quote]
This evening Holmes told me that Saraswat attempted to contact him today, but they were unable to connect as Holmes has been in the field, further investigating the situation on the ground. He hopes to speak with the ministry official tomorrow to see what steps the government is prepared to take.
Chemical contaminants part of equation?
Though he’s not a toxicologist, Holmes acknowledged to me the presence of other potential contaminants besides heavy metal tailings in the mining process which may be of concern. He has worked around mining operations, including Mount Polley – also a client of Cariboo Envirotech.
One such set of contaminants, used in the milling process – after ore has been mined from the ground – is referred to as “chemical reagents”.
According to John Werring, a salmon biologist with the David Suzuki Foundation, the two main chemical reagents being used at Mount Polley –acknowledged by Imperial Metals – are sodium diethyl dithiophosphate and potassium amyl xanathate.“The problem with mining operations in Canada is that, for the most part, the kinds and amounts of chemicals that are used to extract the ore are trade secrets and therefore are not reportable in any kind of a forum or database.” Thus, mines like Mount Polley don’t need to report the concentrations of these chemicals in the materials they discharge into the tailings reservoirs.
Werring’s not jumping to any conclusions about potential health impacts from these chemicals, but he does feel there are many unanswered questions surrounding the issue, given the toxic nature of these substances.
“These two particular chemicals are highly toxic,” Werring warns.
[quote]Sodium diethyl dithiophosphate is a level three poison. It has impacts on human beings and…it’s specifically stated is highly toxic to aquatic life. Potassium amyl xanathate, similarly, is highly toxic to aquatic life. What we don’t know is how much has been discharged in these tailings, we don’t know the fate of these potential chemicals once they get in the tailings pond.[/quote]
Werring responds: “That’s a wonderful statement to say, but nobody is measuring.” Moreover, “There is absolutely no mention of the kinds and concentrations and the treatment of sodium diethyl dithiophosphate, which is even more toxic.”
Even the heavy metals in Mount Polley’s tailings, which are not ordinarily subject to acid rock drainage,when contained under water, are now exposed to weathering, says Werring. That creates the potential for acid rock draininage, oxidation and other changes that could render them more harmful to the environment than previously thought – especially on a longer-term basis.
Something in the air?
A study by the Centre for Disease Control on Chemical-related injuries and illnesses in U.S. mining lists inhalation as one of three main pathways for mining-related chemicals to enter the body. “Inhaled chemicals can cause acute responses such as nausea, headaches, shortness of breath and asphyxiation,” the paper states, “or they can have chronic outcomes such as central nervous system disorders and respiratory illnesses.”
Out of 2,705 cases of workplace injury reported to the U.S. Mine Safety and Health Administration’s employment and accident, injury and illness database – from 1999 through 2006 – roughly a third came from inhalation.
It is impossible to say without proper testing what potentially airborne particulate or chemicals such as reagents could be emanating from sludge and water spilled by the breached containment facility. Or whether these or other contaminants could be impacting the health of people close to the disaster.
It is also premature to rule out health impacts from chemicals which have been used in Mount Polley’s processing without any information from the company about volumes of chemicals in their effluent. My calls on the subject to Imperial Metals’ communications officer have gone unanswered yesterday and today. I’m still waiting on a response from the Ministry’s media relations with regards to these questions.
“My home is destroyed”
As for Sylvia Palm, she doesn’t yet feel comfortable returning to her home of 40 years on Quesnel Lake. “My home is destroyed,” she told me by phone yesterday.
She’s taken her concerns to various authorities, with little to show for it. First, the Cariboo Regional District told her the matter was beyond their jurisdiction, referring her to the Ministry of Health. There, Palm was pointed instead to the Ministry of Environment, where she spoke with Cassandra Caunce, Regional Director for Environmental Protection, Thompson/Cariboo (calls to Ms. Caunce were not returned by the time of this publication).
“From what we’re hearing, everything’s OK,” Palm says Caunce told her, suggesting she try speaking with a medical practitioner. Upon an initial visit to the Williams Lake Hospital earlier this week, a nurse there found elevated blood pressure and prescribed an anti-histamine, guessing from her symptoms that Palm may have experienced an allergic reaction.
Palm has an appointment with a doctor next week, when she plans to ask for a sample of her blood to be taken and tested for contaminants.
Echoing Holmes’ questions to the ministry, Palm says, “One of my biggest concerns is that community members are beginning to clean up the beaches of Quesnel Lake around Likely and to my knowledge they’re not using proper protection.”
[quote]You err on the side of caution when people’s health is at risk.
Meanwhile, Clow continues drawing attention to the fact that part of the government and company’s “cleanup” plan involves pumping contaminated water out of Polley Lake, into Hazeltine Creek, and, ultimately Quesnel Lake, which in turn connects to the Fraser River.
This is what they are currently dumping into Lake Quesnel and into the Fraser River,” Clow wrote on August 11. “Understand that this is on its way as I type this.”
In the coming days, we will continue seeking answers to these vital questions and bringing readers video highlights from Jeremy Williams’ trip to the region – including firsthand accounts of the disaster and health effects experienced by early responders.
By any measure, the giant tailings dam rupture at Imperial Metal’s Mount Polley Copper Mine is a disaster for downstream communities and wild salmon. The massive dam breach released a raging torrent of slurry mine waste into Hazeltine Creek and Quesnel Lake, prompting local emergency response officials to warn downstream residents not to drink, cook with, bathe in, or come into contact with the effluent.
Red Chris scheduled to open in Sept, despite tailings pond flaws
Another dam failure could happen. The company that owns Mount Polley, Imperial Metals, is the same company behind the Red Chris mine, located near Iskut in northwest BC. Red Chris would be an open pit gold and copper mine that, like Mount Polley, would use an earthen dam for their tailings pond at the headwaters of the Iskut River, the largest tributary of the transboundary Stikine River.
In 2013, a third party review was done of Imperial Metals’ engineering designs for their tailings pond at Red Chris. The independent review concluded there was no guarantee that Imperial Metal’s tailings pond would hold toxic wastewater from the mine. Despite this conclusion, construction at Red Chris has been allowed to continue, and the mine is currently scheduled to open in September of this year.
This is disturbing because of the many worrying comparisons between Mount Polley and Red Chris. At Mount Polley, in the years prior to the tailings dam breach, Imperial Metals ramped up daily production of ore from 18,000 tonnes per day in 2009 to more than 23,000 tonnes by 2014, with production escalating in the three months just prior to the breach. At the same time, the tailings dam walls were continuously built higher to deal with larger amounts of mine waste. “Dam building cannot continue indefinitely,” said a 2011 environmental consultant’s report, warning of structural instability in the dam if the growth pattern continued.
Kynoch envisions 5x permitted production at Red Chris
While Red Chris is permitted to produce 30,000 tonnes of ore per day, slightly larger than Mount Polley, Imperial Metals envisions that production at Red Chris could escalate at a much faster rate. In 2013, President Brian Kynoch conjured up a vision for potential shareholders of the Red Chris mine churning through 150,000 tonnes per day, a mine five times larger than the project for which they received an environmental certificate. At Red Chris, the same pattern of escalating growth that happened at Mount Polley could happen on a much bigger scale.
Clearly tailings dams fail, and not all the failures are the result of aging infrastructure. At Mount Polley, the tailings dam was built with modern technology and was only 14 years old.
Alaskan Senators raise alarm over BC’s regulation of mines
The Mount Polley tailings dam breach emphasizes the concerns that downstream communities, most vocally Alaskan tribes, commercial fishermen and tourism operators, and most recently Alaska’s two Senators, have raised about proposed BC mines. In the transboundary Unuk, Stikine and Taku River watersheds, proposed mines like KSM, Red Chris, and Tulsequah Chief all pose potential downstream risks to southeast Alaska’s $1 billion a year fishing industry, $1 billion a year tourism industry, and customary and traditional activities.
Mining at KSM would involve a high potential for water pollution and downstream habitat degradation. As proposed, at the mine site, just upstream from Alaska’s Misty Fjords National Monument, three open pits would be dug in steep rugged terrain that has some of BC’s highest levels of precipitation. One of the pits would be the deepest in the world.
At this site, massive amounts of water would need to be captured, treated and discharged during mine operation and after closure. Seabridge Gold proposes a system involving seven of the largest water treatment plants ever built, treating up to 118,000 gallons of contaminated water a minute.
KSM would also include twin 23 km tunnels, drilled through the mountains to link the mine site to an ore plant and an 8×2 km tailings pond. More than two billion tons of tailings waste would be stored just upstream from critical salmon habitat in the Nass watershed, BC’s third largest salmon system. The proposed tailings pond would store 63 million cubic metres of tailings water,orders of magnitude more than the waste that spewed out from Mount Polley.
Nass, Unuk River salmon at risk
A spill at the KSM tailings pond or mine site water containment areas could damage downstream salmon habitat for years. Even under normal operation, concerns about KSM are heightened because 71% of the total waste rock at the site is known to be acid generating (much higher than at Mount Polley). Toxic levels of selenium are also a known issue, and proposed treatment systems to remove selenium from wastewater are unproven at the scale proposed by Seabridge.
Before Mount Polley, Feds unworried about KSM dam failure
In July, CEAA did not appear worried. “A catastrophic dam failure,” wrote the authors of CEAA’s Comprehensive Study Review of KSM, “would likely have high magnitude downstream residual impacts on fish, fish habitat and water quality.” However, said the federal regulator, the likelihood of such a dam failure, “is considered unlikely.”
Just days after that report’s release, the Mount Polley tailings dam blew out and a torrent of mine waste contaminated downstream water bodies and critical salmon habitat. The disaster was both a tailings dam failure and a failure of regulatory oversight. It needs to be cleaned up. And it can’t be allowed to happen again.
CEAA taking public comment on KSM until Aug. 20
The final CEAA public comment period on KSM is now open, and comments on the proposed mine should be sent to CEAA by August 20. Instead of rubberstamping KSM, the Federal Minister of the Environment, Leona Aglukkaq, has an opportunity to reject the mine, or to step back and call for a Panel Review, which would allow for more public participation, and more time to assess this risky mine.
The clean-up costs for the massive tailing pond spill at Imperial Metals’ Polley Mountain mine have been estimated by some to range between $50 and $500 million. In addition, legal action will undoubtedly be launched by individuals, businesses, and First Nations in the region which could result in hundreds of millions more in costs. And then there are law firms launching suits on behalf of Imperial stockholders who have suffered huge stock losses when the company’s stock plunged over 40%. Whatever the final amount, the issue comes down to – Who is going to pay?
On August 8, BC Environment Minister Mary Polak said: “We have a polluter-pay model in British Columbia and we expect the company will be the one paying for the cleanup and recovery” and that she has “heard commitments that [the company] is ready, willing and able to continue to fund what they need to”.
However, comments from Imperial Metals president Brian Kynoch suggest that the situation may be a lot more dicey than this optimistic statement from the Minister. According to one news report, Kynoch has committed to paying for the clean-up “to the best of [his] ability”. But in contrast to Mary Polak’s statement that the company is “ready, willing and able” to pay for the spill, Kynoch is more equivocal and doubts that the company’s insurance will be high enough to cover the cost (for more on the insurance issue see Aug. 12 column).
Imperial in financial Catch-22
After indicating that the company does not have the money in the bank at this time, Kynoch goes on to say that, “If it’s $400 million, then we are going to have to get mines generating to make that money to do the cleanup.”
But there is a problem here when Kynoch says that we need to “get mines generating” the cleanup funds. For one thing, as noted before in 250 News on Aug. 7th, company financial statements of previous years reveal that the Mount Polley mine itself was being used to generate “cash flow” for the company’s new Red Chris mine in northwestern BC, as well as other Imperial operations. Yes, the Red Chris mine is nearing finish as is its extension to the Northwest Transmission Line, and presumably will generate substantial amounts of revenue down the road. But completion of the construction, as well as start-up funds, will be required for a while before that happens, especially since negotiations are still going on between Red Chris and that Tahltan First Nation regarding the mine.
So the Red Chris mine will still need cash flow from other parts of the company. But the Mount Polley mine, which has been a cash cow for Red Chris, will likely not be in operation until the end of the year or later. In the meantime, clean up and associated costs for the spill will be mounting by the day. To compound the problem, Imperial Metals’ other operating mine, Huckleberry Mine (which Imperial has a 50% stake in), was down for several months earlier this year because of equipment failure. The company has a lot of debt, and, as one financial analyst says, “the shutdown of Mount Polley will stretch thin an already tight balance sheet”.
Red Chris: The sharks are circling
So how will the financial oligarchs who dominate the Canadian and global mining industry view this dicey situation? Speaking plainly, some are no doubt looking at how to hive off the lucrative Red Chris mining asset and other Imperial assets from the Mount Polley operation, which is already nearing the end of its life as a mine and will be beset with clean-up costs and lawsuits for years to come. Indeed, a number of big companies were in fierce competition to gain control of the Red Chris property several years ago, but Imperial Metals eventually won out. Now the situation has changed and the sharks are circling again as can be seen by recent business analyst speculation on how Red Chris might be torn away.
But could this conceivably happen? Could the Red Chris mine and other Imperial assets be siloed or separated off from a Mount Polley mine that is burdened with debt and lawsuits? Could then the Mount Polley operation (or even Imperial Metals itself) eventually go bankrupt requiring public funds to clean up the mess and leaving plaintiffs twisting in the wind?
Each Imperial mine is its own separate company
The first thing to get straight is that, although the Mount Polley mine and the Red Chris mine are all part of the parent company Imperial Metals and are subsidiaries of it, they exist as separate companies. For example, the Mount Polley mine is owned by the Mount Polley Mining Corporation (Imperial Metals acquired majority ownership back in the 1990s) and the Red Chris mine is owned by the Red Chris Development Corporation. In turn, both are wholly owned by Imperial Metals.
To many, it would seem logical that any debt or obligations incurred by the Mount Polley Mining Corporation should fall on the parent company Imperial Metals and its wholly owned subsidiaries such as Red Chris Development Corporation. But that is not necessarily the case according to current corporate law and government policy.
For example, a few years ago in BC, there was a tank car spill on a railway and the parent railway company and its 100% owned subsidiary company (which actually operated the railway) were sued. But the BC Provincial Court ruled “that the parent company wasn’t liable for the subsidiary’s environmental offences” because it merely owned the railway and didn’t operate it (Environmental Compliance Insider).
But wait. If we examine Business Registry records regarding Imperial Metals and its subsidiary companies, we find that there are several overlapping members of the Boards of Directors, i.e. several of the Imperial Metals directors sit on the board of Mount Polley Mining Corporation and the same is true for some of the company officers. Doesn’t this prove something in terms of potential responsibility?
Not in this particular railway case. The court found that it didn’t matter that there were overlapping directors. The parent company got off scot free (although this does not always happen).
BC public could be left out in the cold
In such a circumstance, it is within the realm of possibility that the subsidiary company could then go bankrupt and leave the plaintiffs and the people of BC out in the cold.
And yes, corporate reorganizations do happen all the time where assets are hived off. Indeed, Imperial Metals, facing bankruptcy back in the early 2000s, did exactly that in a court-sanctioned restructuring which saw subsidiary oil and gas companies and assets shifted into a separate company from its mining assets (which were facing difficulty at that time as a result of low metal prices).
In any case, a better situation for the workforce, local communities and businesses, First Nations communities and the people of British Columbia will be that Imperial Metals and its subsidiaries remain intact and continue operating under strict public oversight, as well as with First Nations and community consent. It is especially important that Red Chris Development Corporation is not sold off by Imperial Metals and that the Mount Polley Mining Corporation is not hived off and put into bankruptcy.
Red Chris revenue should support Polley cleanup
As revealed in Imperial’s Annual Reports, the Mount Polley mine provided cash flow for the Red Chris mine construction and all sorts of profits for Imperial shareholders. Now it is Red Chris and Imperial’s turn. Clean-up costs and legal costs can be expected to go on for years. Rather than being sold off for a song and taken over by global financiers, the revenue from the lucrative Red Chris mine must be used to pay for these costs now and in the future. As previously noted, Imperial Metals’ president Brian Kynoch appears to support that course of action.
In terms of Imperial’s current financial woes, an immediate solution could be for Imperial’s largest investors, several of whom have very deep pockets, to step up to the plate and provide financing to stabilize the company’s situation. These dominant investors, who have directors connected to them on Imperial’s board, have profited greatly from Imperial’s operations in the past and should have been aware of the risks the Mount Polley mine was taking.
It is clear that vigilance is needed in this fast moving situation. For its part, the provincial government must make it very clear to Imperial Metals, as well as those who may be considering carving the company up, that it will not go along with any financial maneuvers that will hurt or endanger the interests of the people of BC or hinder the clean-up and financial reparations.
Peter Ewart is a columnist and writer based in Prince George, British Columbia. He can be reached at: email@example.com
The following is an open letter from Alaskan US Senator Lisa Murkowski to Secretary of State John Kerry.
Dear Secretary Kerry,
I am writing to reiterate my concerns about large-scale mining in British Columbia, which has the potential to adversely affect downstream fisheries and communities in Southeast Alaska.
The tailings pond breach at the Mount Polley Mine on August 4th has renewed the specter of environmental impacts from large-scale hardrock mineral developments in Canada that are located near transboundary rivers. While it is encouraging that Canadian officials are publicly stating that preliminary test results show contaminant levels remain below both drinking water and aquatic life guidelines, this incident should compel the State Department to evaluate additional steps that may be warranted to safeguard U.S. interests.
One such step would be to encourage Canada’s federal government to undertake a Panel Review of the Kerr-Sulphurcts-Mitchell (KSM) mine in British Columbia. While the project has already undergone extensive assessment, a rigorous final review would help ensure that its potential impacts on trans boundary waters – and Alaska – are fully minimized. A Panel Review would help guard against a similar breach of wastewater and tailings, which in the case of the KSM mine could be released into the Unuk River, just 19 miles north of the Alaskan border.
Thousands of Alaska Natives, commercial fishermen, and tourism industry stakeholders have legitimate concerns about the potential impacts that large-scale mining in Canada could hold for them. I therefore urge you to accelerate your work with your Canadian counterparts to confirm that new mining activities are subject to proper review and continued oversight.
The Bill Bennett dog and pony show has been wheeled out in the media once again, this time to cover for his long time pal and major campaign contributor Murray Edwards – the biggest shareholder at the now infamous Mount Polley Mine.
It also has Minister of Mines and Energy, Bill Bennett doing damage control on behalf of the BC Liberals for their mismanagement of mining in BC – choosing to let companies police themselves as the BC Liberals rid themselves of government inspectors.
Here’s what Postmediacolumnist Stephen Hume had to say about Bennett’s response: “…the usually ebullient and forceful minister sounded uncharacteristically querulous, a hand-wringer rather than a strong leader. The best he could initially summon was the observation that the disaster shouldn’t have happened. Gosh, you don’t say! But it did happen, on his watch, and he is responsible for making sure accidents like this don’t happen.”
The most Bennett could muster was a whopping $1 million fine for this colossal fiasco.
But why would Bennett take a political hit by being so weak on the issue, when Imperial Metals has been so openly reckless in their stewardship of the environment?
Mount Polley owner one of Liberals’ biggest donors
Back in January 2013, two men – Murray Edwards and Rod Love – put on a $125 per plate fundraiser in Calgary for the BC Liberals, prior to last provincial election. Dig a little deeper and you’ll find that various companies in which Calgary billionaire and Flames owner Edwards is a major investor gave an additional $482,857 to the BC Liberals over the last several years:
Imperial Metals: $178,300
Canadian Natural Resources: $153,480
Penn West Petroleum: $65,835
Mount Polley Mining: $46,720
Resorts of the Canadian Rockies: $23,522
Ensign Drilling: $15,000 (source: Elections BC)
No wonder the BC Liberals began gutting the Ministry of Mines and paving the way for pipelines as soon they got into power. Less regulation and enforcement means more room for profit.
And with the 18th richest billionaire in Canada as Bennett and Clark’s major campaign contributor, we should expect to see more of the Minister of Energy and Mines sitting pretty in front of the cameras, as he whitewashes the Mount Polley disaster for his buddy Mr. Edwards.
The Mount Polley Mine/Imperial Metals disaster is such that one scarcely knows where to start. Fortunately, the people of British Columbia have a writer like Stephen Hume, who in the Vancouver Sun tells chapter and verse about the failings of the Ministry of Environment’s statutory obligations to regulate.
You know, there must’ve been a date back when that all of the civic dignitaries and the executives of the company and a number of politicians had a glorious day opening the mine and telling everyone how safe it was and how the company’s record was perfect and that in the very unlikely event they missed something, why, there were always those faithful government inspectors to make sure that things were up to snuff.
Expect same (de)regulation of LNG, pipelines, tankers
This naturally got me thinking about the same things now being said about LNG plants and tankers; about Tar Sands pipelines and tankers. Same corporate public relations departments – same addle-headed politicians.
I suppose the answer is that when you have political lightweights like the Christy Clark government, totally unmindful of their responsibility to stand by their actions, you’re not going to have anyone even pause for a moment to think that they should pay a price. The whole question of ministerial responsibility has become less and less fashionable as the years go by, but surely there must be some point where the screwup is so bad that someone must run up on their sword.
They should have seen this coming
Lest one think that the Clark government hasn’t had the faintest idea the trouble was brewing in the inspections department, Stephen Hume tells us that the University of Victoria’s Environment Law Center reported in 2012 that environmental assessment certificates issued by government were often “vague and unenforceable”… and that by 2008, the number of mine inspections had fallen to one half what they were in 2001. The Ministry of Environment staff shrank during that time by 25% and the chief mining inspector had insufficient staff to complete the annual the monitoring reports required. And – this has to shake you – the report said:
[quote]This ramshackle enforcement regime is not good enough for an industry that can create environmental and financial catastrophes.[/quote]
Thus the Clark government knew that their enforcement system was inadequate to the task, yet when that breach of public duty spawned disaster, they pay no price!
The Campbell/Clark liberal government has been playing Russian roulette with the safety of British Colombians since it took office in 2001.
Same lax regulations applied to fish farms, IPPs
You may remember that one of the first things this government did was return all of fines levied against fish farmers for illegal practices.
Then came the “raping” of our rivers by private power concerns who were given the opportunity to bankrupt BC Hydro at the same time. These private schemes, which put up dams on the rivers which they prefer to call weirs, are under strict guidelines as to how much water they can use and when, in order to protect the fish. The trouble is that the companies have paid no attention whatsoever to these guidelines unless it suited them and the government hasn’t enforced them, nor has it demonstrated any intention to.
Thus, when you look at the failures of the Ministry of Environment as outlined by Stephen Hume, you see a systemic avoidance of enforcement going right back to the days the Liberals were elected. Yet no minister nor the government need take any responsibility for this!
“Red Tape” and other euphemisms
Enforcement rules are usually referred to by industry and their captive politicians as “red tape” and “de-regulation” or “streamlining” become buzzwords. It’s assumed that if all of these silly bureaucrats would stop trying to enforce idiotic safety regulations, we would all make lots more money. The notion perpetuated by industry is that every rule and regulation is there to stop them making money and, of course, distributing that generously amongst the less well-off in the community, and that these stupid bloody rules should all be tossed aside or ignored; that government regulation, whether it be by way of safety in a factory or a mine, or protection of fish and wildlife, are all bureaucratic nuisances set in place by “socialists” to prevent the entrepreneur from doing great things.
This is the history of these matters. When you read about the struggles of labor unions to get essential safety features into the workplace and see just how minor those reforms were and the fuss the politicians and industrialists made, you can’t believe that caring human beings with souls were involved on the corporate and government side.
Corporations have but one objective
The problem with the general public is that by and large it doesn’t understand what corporations are all about. Companies have one sole purpose: making money for their shareholders. Every penny that is taken from that undertaking is a penny misspent. This is not some sort of socialistic cynicism – it’s simply describes the beast. It has always been that way and it always will be.
Does anyone seriously think that entrepreneurs would go out of their way to voluntarily provide safety regulations and environmental protection and things of that sort that were adverse to their ability to make money? History is crystal clear on the point.
Of course, there are areas where it makes sense for companies to do the right thing by the general public. But it has to make sense on the balance sheet.
The sad thing here is we’re not talking about natural disasters but man-made disasters that could’ve been and often were predicted but ignored. We’re like Charlie Brown and football – we know Lucy’s going to pull it away at the last minute, but we play the game anyway and we always lose. It’s as if we don’t want to know the answers.
This may seem unrelated to the Imperial Metals disaster, but it actually is very apropos. It is not just the likelihood of a disaster we must concern ourselves with but the extent of that disaster. We then must decide whether or not we’re going to take adequate steps to police these undertakings or just blissfully ignore them because the public relations departments of large companies tell us there’s nothing to worry about?
The Imperial Mine disaster story has legs. We now have in front of us a snapshot of what happens when large undertakings with potentially catastrophic consequences are not policed.
This is what happens when we leave it all to the Company.
This is what happens when a right-wing government takes over and decides to go easy on big business.
This is what happens when we allow ourselves to be deluded into buzz phrases such as “we’re being ruined by red tape”.
This is what happens when we turn a blind eye to common sense and assume that because nothing has happened yet, it’s not going to happen.
The Imperial Metals disaster proves, as if proof were necessary, that no large corporation will do anymore than it has to and then it will always place money in shareholders pockets ahead of money in public safety. It proves again, as if it were necessary, that governments in the pockets of industry will pay no attention to troublesome details like public safety and the security of our Wildlife.
The real question is what do we people think or care about this. If we believe that industry knows best and that our wellbeing depends upon our accepting their terms – so be it. We can’t be heard to complain about the consequences.
If, on the other hand, there is more to life than making money for foreign companies and we do care about the safety of our people, the preservation of our environment and the wellbeing of our wildlife, then we have to make some economic sacrifices. These economic sacrifices include not just passing regulations to ensure that those who invade our environment do so safely, but enforcing those regulations and being prepared to spend the money to do that.
Heads should roll on this one, but of course they won’t. Premier Clark hasn’t the faintest idea about responsibility of cabinet ministers to back up their mistakes with resignations. We the public should learn that laissez-faire government carries with it the inevitable consequence that the rich get richer and that the public and the environment in which they live get much the poorer.
If we don’t learn these lessons from this disaster, then we get what we bloody well deserve.
Mount Polley’s tailing pond breach is the worst environmental disaster in BC History. It will be a BC Day that goes down in infamy and, from the environmental perspective, may be one of the world’s worst mining disasters when all is said and done.
Disaster follows massive increase in toxic tailings
Mount Polley owner Imperial Metals, in its most recent report, claimed as much as a seven fold increase, year-over-year, in toxic compounds like arsenic stored in the pond. The full list reads like a who’s who in the world of toxic health concerns, yet the CEO claims he would drink the tailing water, as long as the solids were removed.
This most recent, massive increase in toxic tailings being stored in the now-breached and near-emptied “pond” corresponds with a massive increase in production that has occurred over the last year. The Vancouver Sun reports:
[quote]Imperial has increased production at Mount Polley. The company reported in its second-quarter financial report that throughput at the mine’s processing mill was up 23 per cent to 23,404 tonnes of rock per day and meal production totalled 12 million pounds of copper, up 46 per cent, 11,867 ounces of gold, up 24 per cent and 33,813 ounces of silver, up 35 per cent from the same quarter a year ago.[/quote]
Province allowed production increase, against expert’s warning
All of this was allowed by the province to occur after Brian Olding, an independent consultant, had clearly outlined serious concerns and even offered a remedy by urging the company to apply for permits for up to 3 million cubic feet a year of effluent to be discharged into the wild.
A permit for effluent release of 1.4 million cubic ft already existed (permit#11678) but treatment of the effluent before discharge became a stumbling point resulting in delays of safely discharging the excess effluent with the blessing of the local First Nations.
They know they cannot drink the water as the CEO suggests and they know that it is all a result of our current Government’s affinity for simply getting out of the way of industry and their desire to massively exploit our resources.
Everyone also knows, that in the end, the watershed that sustains all living things in the region is in serious jeopardy and the same people immersed in this disaster will see their taxes pay for the clean up for years to come.
The $5.3 billion proposed Kerr-Sulphurets-Mitchell (KSM) mine, which received BC government approval yesterday, boasts one of the world’s largest gold and copper deposits. But with big promises of jobs and ore come serious concerns over the staggering volumes of tailings and acid rock drainage the three-pronged mine could produce.
Its 2 billion tonnes of tailings, for instance, represent 6-7 times the volume slated to be produced by nearby Red Chris Mine.
Located in the northwest corner of the province, the project is made up of three neighbouring mountains from which proponent Seabridge Gold estimates it could mine 10 billion pounds of copper, 133 million ounces of silver, 38 million ounces of gold and 200 million pounds of molybdenum. Seabridge is trumpeting 1,800 jobs during construction and 1,000 permanent jobs once the mine is up and running.
Province touts “family-supporting jobs”
Employment opportunities seem to have been the key driver of the BC government’s approval. “This will be a major employer, not just for the northwest but for all of B.C. and it will pump a lot of money into our economy,” BC Minister of Mines Bill Bennett told the Canadian Press upon announcing the mine’s environmental certificate yesterday. “These are high-paying jobs. They’re family-supporting jobs.”
Seabridge is also touting broad First Nations support. It has signed an agreement with the Nisga’a Nation, which includes profit sharing and skills training. The company also claims support from the Gitxsan First Nation.
It would also produce more than 2 billion tons of tailings, and one of its three open pit mines would be about as deep as the deepest open pit mine in the world today. Water treatment facilities filtering water from the mine site and into the Unuk River, which flows into Alaska’s Misty Fjords National Monument, may need to operate 200 years or more to prevent acid from draining into Southeast Alaska waters.
British Columbia’s Environmental Assessment Office, which is reviewing Seabridge Gold’s 33,000-page mining application, says review and oversight — as well as Seabridge’s efforts to date — will ensure the mine, if permitted, is environmentally safe.
But others in Alaska and BC worry about the mine’s vast scope and effect on fish. They say should anything go wrong with this or other mines proposed in BC during or after their operation, acid mine drainage could contaminate important salmon producing rivers and Southeast Alaska’s waters, and Southeast Alaska and Yakutat’s more than 5,000 annual fishing jobs — and its fish — could be in jeopardy.
Despite these well-founded concerns in Alaska, its state regulator has lacked the resources to conduct a thorough review of its own, relying on funding from Seabridge to engage with the application, and putting a great deal of trust in the BC Environmental Assessment Office. “The state’s participation in the permitting review (for KSM) seems entirely dependent on funds from Seabridge Gold,” Chris Zimmer of Rivers Without Borders told the Juneau Empire. “I think this is an inherently bad situation.” His organization has been asking the federal State Department to get involved in the process, in order to ensure local authorities don’t give the matter short shrift.
To claims that Alaska has little regulatory power to intervene in the process, Zimmer retorts:
[quote]The state can be proactive and demand better standards, higher bonds, other mechanisms to protect water quality…invoke the Boundary Waters Treaty (of 1909). Look to the example of Montana and the Flathead Valley.[/quote]
With provincial approval of the project, that ship may have already sailed, but that’s not to say it doesn’t face significant hurdles going forward, on both sides of the border.
BC First Nations concerned about fish impacts
Impacts on fish have been a concern for First Nations in BC as well. The Gitanyow First Nation, which fishes the Nass River, where the tailings facility would be located, has expressed grave reservations about the project. It commissioned UVic biologist Michael Price to study the potential impacts of the project on downstream salmon. In a report submitted to the provincial government by the Gitanyow Fisheries Authority, Price concluded that salmonids “will undoubtedly be subject to sub-lethal metal toxicity. In some circumstances…the effect most probable is secondary death.”
Seabridge claims it has responded to these concerns with the addition of a lined cell to protect watercourses from “potentially acid-generating material”. Says Seabridge Vice President of Environmental Affairs Brent Murphy, “This (lined cell) is one of the main aspects of accommodation and was built into the design to address the concerns of the local Aboriginal people.”
The company has signed an agreement with the Gitanyow to monitor water quality and fish health, but will that be enough to appease their concerns in the long run? Moreover, the company has yet to reach a deal with the Tahltan First Nation – renowned for blocking other mining and gas projects in the past, particularly over water and salmon issues. Without firm support from the Tahltan and Gitanyow – especially in light of the recent Tsilhqot’in decision – the project will remian on shaky ground.
On that note, The Tsilhqot’in case and failed Prosperity Mine project offer a reminder of how provincial approval can be trumped by legal complications and federal rejection of the project. With the Harper Cabinet yet to render a decision on KSM, any celebration of the project’s approval at this stage is premature. In a letter to the Canadian Minister of the Environment last year, the Gitanyouw Hereditary Chiefs complained, “the timelines imposed by the (BC) EAO are clearly inadequate to enable meaningful consultation and ensure that proper mitigation aspects are in place.” That’s just the sort of language that can form the basis of a constitutional challenge, built on the strengthened foundation of the Tsilhqot’in decision.
That said, all signs are pointing toward a Fall approval from Cabinet, as the Canadian Environmental Assessment Agency has already determined in its own review that the project would likely result in no “significant adverse environmental effects.” At that point, the strongest defence remaining against the project would likely be a First Nations-led legal challenge.
Funding not in place
Even if the company faces no serious legal challenges or regulatory hurdles, the project is not yet a given, without the significant financial backing required to make it a reality.
“Obviously, we have high expectations for this project, but until we get a partner in that’s willing to fund most of the capital and build the mine, the project is not a go yet,” Seabridge CEO Rudi Fronk told the Canadian Press.
[quote]We need that partner in place to make that construction and production decision. We’re not going to make it on our own.[/quote]