Reclamation And Community Relations Critical To Reopening Mine
Environmental article by Harold Hough
As many metals prices go up, mining companies are taking a hard look at reopening old mines and mining ore deposits once thought to be uneconomical. But, what many mine owners don’t realize is that the way they reclaimed the old mine and treated the local community will have a major impact on getting the new mining permits.
One excellent example is the Golden Sunlight Mine in Montana. Although Montana has recently become more anti-mining, Golden Sunlight was able to get state permission to reopen in large part due to the overwhelming community support of the mine.
Although the mine is in a district where mining has taken place for over a hundred years, the Golden Sunlight didn’t start mining until 1982. At the time, metals prices were high and there was little overburden to move. As a result, the mine didn’t invest in larger, more expensive mining equipment.
When metals prices began to fall in the 1990s, the mine faced a serious problem. Despite increasing gold production, the mine was running a deficit of over one million dollars a month. Either the mine would have to be closed or operations would have to be seriously restructured in order to stay in the black.
The first option was to increase production to take advantage of economies of scale. The problem was that there weren’t enough reserves to make that worthwhile. Even at current production, reserves would be exhausted in 2004.
The answer was to cut back operations so the operation didn’t have to use the small equipment that had been operating since the mine began. By cutting back production by about 33%, the old, small equipment was sold or scrapped and only the larger, more efficient equipment remained in use.
But cutbacks mean letting people go and one of the problems of being the major employer in a small community is that the Golden Sunlight was going to create some economic dislocation. In order to make the cut backs as painless as possible, mine management decided to defy conventional thinking and even looked to the outside for advice.
Unlike many mines, Golden Sunlight managers made the employees aware of the problems and made it clear what was going to happen in order to make them more psychologically prepared when it happened. At the same time, the company offered early retirements for some employees and transfers to other Placer Dome operations in order to reduce the impact.
Management also let it be known that layoffs would be based on time with the company, although some job skills would be retained. This gave workers more warning because those with less security knew what would probably happen. Then when the decisions were made, the announcements were made in private meetings instead of a public meeting or posting a list. And workers were given generous severance packages that helped the families and community economy. The result was a high worker moral during the tough times and lower operating costs per ton. The mine even won the Placer Dome President’s Housekeeping award, which showed the moral of the workforce during difficult times.
Maintaining good community relations also extended to reclamation and land use after the mine was scheduled to close in 2004. In fact, mine management worked with community leaders to determine what should happen when the mine closed. Some of the mine property is scheduled to be turned into an industrial park in order to attract new businesses to the area.
Hunters, who make up a large percentage of the community also benefitted. Over the years, the mine has purchased several properties including the 3,520 acre Candlestick Ranch that was once closed to hunting, but is now open to hunters. Another property was a 532 acre wetland, which is called the largest unprotected wetland in Montana. These properties are well stocked with wildlife, including elk, thanks to an aggressive restoration and enhancement program that has won awards.
Although the current owner, Barrick Gold Corporation, didn’t know it, good reclamation and community relations paid off when gold prices skyrocketed and they decided to reopen the mine. In 2010, when the mine proposed opening the East Pit, strong community support, including a letter-writing campaign (448 were positive, 2 were negative) convinced state officials to grant the permits.
The moral is that a mining company never really leaves a community. As prices fluctuate and new mining technologies are invented, once uneconomical mines may once again be profitable. If a mining company has established good relations with the community, reopening becomes much easier.