Mine waste and water management to deliver projects in record time

As the mineral industry tries to recover from the recent economic downturn, optimism seems to be returning to the global mining industry — even if commodity prices are still highly volatile. After a multi-year contraction in activity from 2012-2016, mineral exploration in Canada has been expanding again in recent years. This optimism is spurring mining companies to look for significant investments. However, mining developers are all looking for a share of a limited amount of financial resources available in the sector.

To secure investments, mining developers must not only demonstrate that ore reserves and project expenditures are balanced, but also that their mining waste management costs and permitting process is under control. Waste and water management are a challenging aspect of mining operations, and must meet stringent environmental standards — which can create costly project delays if not accounted for early. In a mine life cycle, waste and water management is typically an important operating cost that extends past the mine closure. It is therefore necessary to include diligent environmental management strategies and their associated cost baselines early in the project, to set achievable schedule and cost expectations. In this sensitive context, mine waste and water management can actually make or break the economics of a mining project.

Take battery metals as a high-profile example. In these projects, the opportunity window to finance a new mining project is limited. Many new mining projects are highly dependant on speculative future mineral prices that are directly dependent on demand, of course — but also supply. The first developers to get to the finish line will get all the spoils. No rewards for trailing the pack.

Being first to the finish line means raising the required funds to build a mine and supply the commodities to the markets in record time. The following chart, taken from PDAC’s publication State of Mineral Finance 2019, illustrate the volatility of metal prices. The timeline for bringing a project from study through permitting and into production, while commodity prices are high, is key in securing financial resources.

In the past, the process of developing a mining project through an iterative approach of Pre-Economical Assessment (PEA), Pre-Feasibility Studies (PFS) and Feasibility Studies (FS) has often neglected to tailor an acceptable waste and water management strategy to the project conditions. As such, the emphasis was placed on defining classical mining parameters including but not limited to the mineral reserves, extraction and processing techniques, and surface infrastructures. The omission of identifying mine waste and water management strategies (defined in parallel with the Environmental Impact Assessment) as a key constraint early in the project could bring the project to a standstill. Without a reliable waste and water management strategy, the project could easily incur high costs late in the project cycle, or extend the permitting process duration and therefore miss the window of opportunity.

Mine waste and water management strategies must balance the ever-important lowest capital and operational costs with acceptable impacts to the environment. The term acceptable may be viewed as legally permittable and socially satisfactory impacts tailored to the needs of each project and its stakeholders. To develop a successful strategy, a flexible and transparent approach is required. A case must be built to stakeholders around sensitive social and environmental matters such as groundwater and surface water quality, air quality, noise and vibrations, impacts on wildlife, loss of fish habitats, Indigenous land rights, economic activities, as well as safety considerations (such as potential risks of dam failure), to obtain the required permits and authorizations.

The challenge for mining companies and consultants is to define a flexible mine waste and water management strategy early in the project, when inputs are far from final (such as the mining plan, process tailings parameters, waste rock quantities, baseline land conditions, etc.). The ideal strategy will accept variations in inputs as they are further defined, while avoiding unacceptable CAPEX and OPEX cost and schedule delays. Risk planning, stakeholder identification and engagement must be accomplished in the project initiation and planning phases. Leaders must challenge pre-set ideas and use expert judgment to propose creative and innovative solutions in problem solving. A good understanding of potential impacts of input variations on the global project economics, social acceptability and environmental parameters is required to be successful.

To facilitate financing for a promising mining project, tailoring the development and permitting strategy for mine waste and water storage areas early in the project is a key success factor. Innovative cost-reduction techniques, combined with socially acceptable and permittable waste management strategies, will lead to an economically viable project that can be delivered in record time.