Mining Spend on Wastewater Increases 275%

Mining Companies Spent $12 Billion Globally in 2013 on Water Infrastructure, a 275% Increase from 2009

Inspeech to the Society of Mining, Metallurgy and Exploration national convention in Salt Lake City earlier this year, Hecla Mining External Relations Vice President, Luke Russell warned attendees that water quantity and quality issues are the fastest growing economic and social challenge the mining industry faces today.

Mining companies spent $12 billion globally in 2013 on water infrastructure, a 275% increase from 2009, Russell observed, yet mining production costs were only up 52% in the same period.

The Western Governor's Drought Forum held in Arizona last week examined the challenges facing mining, manufacturing and industry during a 15-year long period of drought with more than 70% of the western United States in the grip of a water shortage that shows no signs of ending.

The Washington, D.C.-based Brookings Institute and Stanford University Woods Institute for the Environment held a joint session in California to discuss the undeniable fact that the West is bone dry and the water crisis has become as much an economic issue as an environmental concern and demands focused national attention.

Most of the mining companies contacted for this story indicated that their operations are not yet impacted by the drought. However, mining companies who also own ranches or farms, such as Newmont Mining's Nevada operations, have reduced the size of its cattle herds and hauled water for livestock and wildlife.

In an e-mail to Mineweb Monday, top U.S. primary silver producer Hecla Mining's Russell said, "Hecla is fortunate in that thus far, drought is not significantly impacting our operations in Alaska, Idaho or Quebec. Nevertheless, we continue to look for ways to minimize fresh water withdrawal by recirculation and reusing as much water as we can at each of our operations."

New Gold's Mesquite Mine is located in one the driest, hottest regions in the U.S. near Yuma, Arizona, and Brawley, California. The region averages 3.15 inches of rainfall annually with summer temperatures averaging 107-F in July and 106F in August.

Like most of today's hardrock mining companies, New Gold's mines operates in a close circuit with no water discharges. In 2012, the company recycled 27.3 million cubic meters of water—almost five time the amount of water the company withdrew from natural resources.

In an e-mail to Mineweb Monday, New Gold officials said, "New Gold's Mesquite Mine gets its water supply from groundwater. The aquifer has shown no impact from drought conditions for the past 30 years and we do not expect any impact going forward."

Freeport-McMoRan, which owns mining operations in Arizona, Colorado and New Mexico, has also dealt with arid conditions and water shortages at its mines in Peru and Chile. FCX officials did not agree to be interviewed by Mineweb in time for this story.

During last week's Western Governors' Drought Forum in Arizona, Freeport-McMoRan Director of Water Strategy Sandra Fabritz-Whitney observed, "One thing that we struggle with in Arizona is people telling us we are going to run out of water … We aren't. People have worked for decades to ensure that we are not going to run out of water."

"Our facilities are zero-discharge facilities. We want to capture every drop of water that leaves an operation to minimize any environmental impact while also conserving water," she said.

"Arizona needs to recognize the importance of local neighbors, water providers, and agricultural providers. Those partnerships are where these problems will be solved. Companies like Freeport may be able to solve short-term problems alone, but wide-ranging planning issues can't be solved alone," Fabritz-Whitney stressed.

In its 2013 sustainability report, Freeport-McMoran noted that "most of our operations in North and South America are in water scarce regions." Like most major mining companies with operations in water-stressed regions, Freeport-McMoran maintains water balance models "to better understand water uses and to identify system losses (such as evaporation losses) within the operations."

"Although the potential physical impacts of climate change on our operations are highly uncertain, operations in water-stressed regions also conduct annual scenario planning to evaluate hypothetical reductions of total water availability and hypothetical extreme precipitation events," said the report. "This program aims to help us plan to adapt operations to possible water shortages or surpluses."

Water for FCX's Cerro Verde mining operation in Peru, which is considered a dry region, comes from renewable sources through a series of storage reservoirs that collect water primarily from seasonable precipitation.

The Bagdad copper mine in Arizona has the world's largest elevated tailings thickener, which will allow higher volumes of water to be recovered, as well as minimize seepage and evaporation losses from the tailings storage facility.

Freeport's Candelaria copper operation in Chile, which has recently been sold to Lundin Mining, is a leader in water conservation, recovery and recycling in all of its processes. It became the first mining operation in the world to certify all of its facilities under ISO 14001 standards. As part of the overall strategy to supply water to the Candelaria mine, a pipeline was constructed to bring water from a nearby water treatment facility, along with a desalination plant and pipeline that will supply the Candelaria mine's longer term water needs.

Newmont Mining was the only mining company contacted by Mineweb, which agreed to be interviewed to for this story to discuss its water strategies in the hard-hit state of Nevada, which is still in the throes of a serious three-year water shortage.

In 2013 Newmont developed a global water strategy to "guide our regions and sites on managing water more strategically and engaging others to help mitigate water risk, and to clearly link the technical and operational aspects of water management with long-term strategic and social responsibility objectives."

"As our mines mature, the amount of water collected and discharged from our operations has increased," according to the company's sustainable development report. "We have made notable progress in improving the overall quality of the water discharge, largely as a result of managing contact and non-contact water and, where necessary, expanding the water treatment capacity at our operations."

Newmont's Director of Environmental Stewardship Jeff White told Mineweb Monday that the bulk of Newmont Mining's operational needs at its Nevada mines are met through mine dewatering, except for potable water requirements.

All permitted mine facilities are zero discharge with some dewatering discharge made to surface water systems, he added.

Despite three years of serious Nevada drought, White said it has not affected mining operations, partly due to zero discharge, and tools such as heap leach drip emitters which minimize evaporation and small footprint tailings facilities.

Ironically the drought has given Newmont mining operations a break in handling stormwater runoff.

When it comes to wildfire, however, the drought exacerbated the potential fire danger with tinder-dry fuels that could spark a major wildfire near Nevada mining operations, However, White observed, Nevada did not experience a major wildfire near any Newmont operation so far this year. Mining operations have already been provided with reasonable forage protection in areas near mines.

Nevertheless, the drought is having a more substantial impact on Newmont' Mining's Elko Land and Livestock Company, which includes TS Ranch, Newmont's 450,000-acre cattle and alfalfa ranch in northern Nevada, and the 40,000-acre Horseshoe Ranch in central Nevada. Cattle herds have already been reduced and some acreage voluntarily removed from production, White noted.

The TS Ranch tried to schedule irrigation of its alpha crop earlier this year. Mine dewatering is its primary source of water. Both the TS and Horseshoe ranches have priority water rights, including senior on surface water rights which give them more of a standing among the thousands of water rights claims along northern Nevada's rivers and streams.

Ranch water trucks have hauled water not only to livestock at both Elko Land and Livestock Company ranches, but also to the wild horse population near the Twin Creeks Mine near Golcanda, Nevada, this year, said White.

Drought's proposed regulatory/policy solutions

As western mining operations may escape the same rampant drought impacts which have generated $2.2 billion in losses for California's agriculture industry alone this year, the public policy drumbeat is sounding fast and furiously among national and local interests who are calling for sweeping changes in U.S. water policies.

During Monday's Brookings Institute/Stanford Woodford Institute (The Hamilton Project) forum, Barton "Buzz" Thompson, professor of natural resources law at the Stanford Woods Institute, suggested solutions to growing U.S. water challenges "lie, in part, with the development and adoption of new innovative technologies."

However, among the main management and policy barriers to water innovation are: (1) unrealistically low water prices; (2) unnecessary regulatory restrictions; (3) the absence of regulatory incentives; (4) lack of access to capital and funding; (5) concerns about public health and possible risks associated with adopting new technologies with limited records; (6) the geographical and functional fragmentation of the industry; and (7) the long life expectancy, size and complexity of most water systems.

Among the recommendations of Thompson and his paper co-authors Newsha Ajami of the Stanford Woods Institute and David G. Victor of the University of California, San Diego, are "a public benefit charge on water that can help raise sufficient funds to implement innovative solutions." The trio also recommend the creation of state-level water innovation offices in states with the greatest water challenges or a consortium of like-challenged states in a region such as the West.

Author Robert Glennon, professor at the Rogers College of Law at the University of Arizona, has drawn considerable attention lately from news media reporting on western drought as he advocates "using market forces to facilitate the movement of water resources and to mitigate the risk of water shortages."

In a paper co-authored with Peter W. Culp of the Washington, D.C., law firm Squire Patton Boggs and Gary Lipecap of the University of California, Santa Barbara, and the National Bureau of Economic Research, the three men observed, "The challenge of increasing water scarcity is most evident in the seven states that constitute the Colorado River Basin: Arizona, California, Colorado, Nevada, New Mexico, Utah and Wyoming [Coincidentally all are also western mining states]."

Source: Mineweb

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