11.   ENVIRONMENTAL MANAGEMENT

11.4.1  

Introduction

Iron ore is mined by means of extensive open pits extending approximately 12km in length. Sishen Mine, located in an arid region of the Northern Cape, receives a relatively low rainfall of 350mm/annum. Three towns have developed around the mine, primarily for the housing of mine employees. A number of small mines are located in this part of the Kalahari. The aridness of the region limits surrounding farming activities to sheep and cattle farming. The area behind the town of Kathu is one of the largest remaining populations of the camel thorn tree and is considered an area of natural heritage. The Gamagara River is located to the south of the mine, however, it has been more than 20 years since this river flowed.

11.4.2  

Environmental Compliance

The Mine operates under an approved EMP (July 2002), with four approved addenda for the expansions or operational changes recently made. The DME has not requested that the Mine converts the EMP to meet requirements of MPRDA. Existing water uses on the mine have been registered. An application for a water use licence was made at end of 2004, however DWAF keeps requesting additional information and appears unable to make a decision on the information to be included in the application. The SEP has not been included in the application, however, DWAF has indicated that this can be addressed through a “letter type” report. The mine is currently operating under the Water Act, 1956, permit that has no expiry date. The Mine operates a certified ISO 14001 (certified 2001) EMS. Historically, the Mine has undergone external bi-annual surveillance audits however, the Mine has determined that this is too frequent and is moving to annual audits, with ongoing internal audits through out the year. The Mine undertook an enviro-legal audit during 2004. The aspects identified were rated from 1 to 4 with 1 being low risk and 4 being high risk. The aspects that have not yet been closed out and have a rating of 4 include: the impacts that dewatering of groundwater has on stakeholders and the effect of increasing de-watering impact in future on alternative land uses; non-compliance with GN 704; the impact of dust pollution on air quality and non-compliance with waste management legislation.

11.4.3  

Environmental and Social Management

Sishen Mine employs a number of personnel whose key performance area is environmental management. The primary person responsible for management is the environmental manager who reports to the SHEQ manager. The environmental manager has a technician, an ISO 14001 co-ordinator and a professional in training who report to him. The Mine also employs two other ISO 14001 co-ordinators who report to the engineering and mining managers, respectively. Social management is the responsibility of the Manager Sustainable Development.

The operational environmental budget for the facility is approximately ZAR14mpa. This includes a contribution of ZAR6m to the rehabilitation trust fund, ZAR3.5m for ongoing soil remediation, approximately ZAR0.5m for HQ SHEQ costs and the remainder utilised for rehabilitation experiments, monitoring, ISO audits, etc. SRK is of the opinion that the budget (ZAR4m) for the daily environmental management of the Mine is sufficient.

11.4.4  

Environmental Issues

Rehabilitation of waste rock dumps: The waste rock contained in the 39 large waste dumps is inert, non-acid forming, and other than suspended solids, does not produce a contaminated seep. Historically, dumping was by end-tipping resulting in the creation of slopes at a natural angle of repose (37°). This slope is difficult to rehabilitate as vegetation cannot easily traverse this slope. The DME may also consider them to be potentially unstable. Furthermore, water runoff from the slopes leads to significant erosion. This has been partially rectified via an internal directive to construct the dumps with a series of benches. Originally bench widths were 20m, however this was increased to 30m in the 1990s and 45m in 2000. This has reduced the overall slope angle, but slopes between benches are still at 37°. Low rainfall limits vegetation growth, further hampering rehabilitation efforts. The Mine is currently experimenting with various rehabilitation options including reducing slope angles and the inclusion of various soil ameliorants. Early indications are that the difference in successful vegetation cover between a slope of 18° and 30° is minimal but the latter is impractical as plants still have difficulty taking root on the slopes. Therefore, if the DME indicates that stability is a problem, the Mine will re-profile the slopes to 24°. This slope angle allows vegetation to comfortably take root, provide for adequate cover and reduce risks associated with stability. However, it still does not increase the plant footprint to the extent that would occur if slopes were re-profiled to 18°. Currently, the Mine has no provision for dump rehabilitation in its closure budget, as it is still awaiting the results of the vegetation experiments. If it is determined that the slopes need to be cut back from the angle of repose, SRK estimates that the rehabilitation will cost the Mine in the region of ZAR150 – 200m.

Backfilling of Pits: The EMPR commits the Mine to returning 50% of the waste rock to the pits at the end of the life of mine. While the Mine is partially compliant with this commitment, a backlog has developed as grade control dictates that the pit remains open as long as possible. This gives the Mine three options for ongoing management: firstly, the mine plan will need to be revised to optimise ongoing operational backfilling; secondly, motivation will need to be made to the DME on why backfilling is not practicable; or thirdly provision in the order of ZAR100 – 150m will need to be included in the closure liability to backfill and rehabilitate the final surface. As a final decision on how this will be managed has not been made, SRK has included this provision as a sensitivity contingency.

Hazardous Material Handling: Historically, hydrocarbon housekeeping management has been poor resulting in the contamination of the soils around the workshops, service and fuel stations and around the High Energy Fuel (“HEF”) plant. To date the Mine has spent ZAR3m on rehabilitating the soils and it estimates that rehabilitation of the remaining contamination will amount to ZAR12m. It is expected that this will be a once-off cost as oil handling has been improved through the implementation of new housekeeping procedures.

Radioactive Sources: Some of the instrumentation in the plant is radioactive. These instruments are managed by an operator licenced to handle radioactive sources. At the end of the life of the equipment, the radioactive sources are disposed of by the Nuclear Energy Corporation (of South Africa). It is understood that a provision for disposal has been made in the closure costing.

Water Contamination: No contamination, other than suspended solids is evident around the waste rock and tailings dumps. Although, the Mine produces a relatively high sediment load, the lack of surface water in the vicinity of the Mine means that the sediments drop onto surface where the runoff evaporates. The use of explosive has led to slightly elevated nitrate levels around the waste rock dumps, however SRK understand that these do not pose a significant risk. The plant utilises approximately 1Mm³/year of treated sewage effluent during the washing process resulting in an effluent containing residual nitrates that is disposed on the tailings dams. This has also resulted in a non-significant increase in nitrates in the groundwater above background but still within DWAF’s drinking water guidelines. Groundwater in the vicinity of the hydrocarbon spills is contaminated with hydrocarbons, however, migration of this plume is limited by groundwater extraction ahead of mining. As the dewatering boreholes supplying town are a significant distance from the source of contamination, there is a low risk that the town’s water supply will be contaminated.

Water Management: Sishen Mine is partially GN 704 complaint and has implement infrastructure to separate clean and dirty water, where practical. Where not compliant, the Mine has either requested exemption or is implementing management practices to become compliant. The majority of process water is sourced from the dewatering boreholes with make up obtained from the sewage plant. When necessary, water is abstracted from the Vaal – Gamagara pipeline. If there is a surplus, historically the Mine has discharged the portion not supplied to the local towns, into a canal which flows towards the Gamagara River (Mine has permit to discharge to the river). However, the water typically evaporates before it reaches the river. As the contamination load in this water is low, it is not expected that the area where evaporation occurs has led to significant soil contamination. The Mine has recently reached an agreement with DWAF, that any surplus groundwater will be pumped to the Vaal – Gamagara pipeline.

De-watering: It has been determined that the Mine has created a de-watering cone that has extended approximately 10km to the south of the Mine, impacting on local farmers water supply. This has resulted in the Mine now being required to supply one farmer with a tank full of water on a daily basis and to pay the difference in costs between abstracting groundwater and pumping water from the Vaal – Gamagara pipeline for another farmer. The Mine has an agreement that it will assist the remaining three farmers “as and when required” (although, there does not seem to be a definition of ‘as and when required’). The Mine is investigating whether a dewatering plume has developed on the northern and western side of the Mine (studies indicate that there is no de-watering cone on the eastern side as it is limited by a significant dyke). Given that the groundwater in the vicinity of the Mine is relatively compartmentalised, the geology of the northern and western side indicates a low potential for the development of a significant dewatering cone.

Soil Contamination: Aside from the areas contaminated by hydrocarbons, the Mine reports that the soils around the ammonia nitrate stores have been contaminated during product handling and from spills and accidents. The area is relatively small and does not represent a significant liability.

Sinkhole Formation: The dolomites underlying the ore body have the potential to form sinkholes. Mining activities have opened a large sinkhole in the South Pit that requires backfilling during the mining process. The Mine has not undertaken any geotechnical investigations to determine areas of potential sinkhole formation, however, Sishen is aware of exploration drilling core losses indicative of potential sinkhole formation. These potential sink holes are relatively small and are all within the mining area. Therefore, aside from a safety risk, these sinkholes do not pose a risk to the surrounding communities.

Waste Handling: Historically the Mine has operated a domestic waste dump in the Mikrogolf area. This dump has recently been permitted by DWAF, however, the Mine is in the process of closing the dump, as the space is needed for the disposal of waste rock. It is not foreseen that there will be any problems with this closure plan, although the Mine will have to obtain closure in terms of Section 20 of the ECA.

Air Emissions: Dust emissions from the Mine are currently a nuisance to the local community with dust being generated in the pit, on haul roads and in the plant. The Mine has implemented dust control measures, such as the use of hydrophilic chemicals at the crushers and Dust-a-Side on the haul roads. With appropriate management this does not pose a significant risk.

Community Relationships: Sishen has finalised its social and labour plan. The Mine operates two community development projects that are expected to become sustainable in time. The first is the employment of redundant farm workers to remove an intruder plant from the Mine and the surrounding Ferroland farms. Sishen has supplied equipment and training to the farm workers. The wood is used to manufacture charcoal, while the wood chips are sold to the Mine for use as organic material during the rehabilitation of the dumps. The second project is the establishment of the Tshipi development centre in conjunction with the Department of Labour. Tshipi focuses on equipping members of the local community (as well as members of the Defence Force and Correctional Services) with a trade skill. A portion of the profits generated by those trained is channelled back to the centre.

Closure Planning and Costing: Closure planning is limited to that covered by the EMPR. The Mine has estimated its liability for immediate closure to be ZAR196m. SRK is of the opinion that the provision is adequate for the work for which it is allocated. This does not allow for any provision for rehabilitation of the waste rock dumps, nor for backfilling 50% of the pit (see above).

11.5.1  

Introduction

The Sishen South project is located south west of Postmasburg on land that has previously been under extensive agricultural production involving small stock grazing on natural veld. To date, the only infrastructure on site is that associated with exploration drilling (offices, core shed and old drill sites). Observations on site indicate that all old drill sites have been well-rehabilitated by ensuring that all visible surfical hydrocarbons have been removed and vegetation re-established in the disturbed areas.

11.5.2  

Environmental Compliance

As the operation is still in the planning stage, limited authorisations have been received. These are limited to permission for:

• Construction of a water pipeline and pump station;
• Construction of a railway line and service road;
• Construction of a new road to Witsand and access road to Kameelhoek.

It is understood a scoping report, an EIA and an Environmental Management plan in accordance with the requirements of the MPRDA are currently being prepared. It is SRK’s opinion that this is in compliance with the requirements necessary to get the environmental authorisations required to continue with the project. It must be noted that although the correct process is being followed, it does not necessarily guarantee that authorisation will be granted, as the granting of the authorisation is dependent on the findings of the EIA and the commitments made in the EMP.

11.5.3  

Environmental and Social Management

Environmental and social management is currently the responsibility of a project team consisting of Kumba personnel and various environmental consultants. A provision for Environmental rehabilitation to the value of ZAR11.9m was made at the end of the first year of the mining operation. An additional allowance to the value of ZAR0.72/t of final product, which equates to ZAR2.2mpa has been allowed for. A total amount of ZAR59m for environmental rehabilitation has been provided for. An amount of ZAR0.5mpa has been allowed for social investment projects in the community around Postmasburg. An amount of ZAR0.5mpa has been allowed for in order to monitor and assess environmental compliance.

11.5.4  

Environmental Issues

Surrounding Landscapes: The Sishen South project is located south west of Postmasburg on land that has previously been under agricultural production involving small stock grazing on natural veld. To date, the only infrastructure on site is that associated with exploration drilling (offices, core shed and old drill sites). Observations on site indicate that all old drill sites have been well-rehabilitated by ensuring that all visible surfical hydrocarbons have been removed and vegetation re-established in the disturbed areas. Although, the site has been impacted on to some degree by agricultural activities, the Postmasburg area falls within the Griqualand West centre of endemism and therefore is ecologically sensitive. The proposed mine is also located on the western edge of the Ghaap Plateau which has been identified as a priority area of conservation by the Northern Cape Nature Conservation. The pans occurring in the area have been described as part of the western Ghaap lime panveld. The vegetation of these pans differs significantly from pans of the eastern part of the Ghaap. These pans have thus been regarded as having high ecological importance since they form part of unique ecosystems or ecological units. The pans within the mining area however, were not found to support any flora or faunal species of conservative importance although, several plant and animal species of conservation importance are known to occur within the proposed mining area.

Mining of the area could result in the loss of a large proportion of the eastern Ghaap lime panveld and there could be the destruction of habitats that support plant and animal species of conservation importance. This could necessitate the adjustment of pit layout to maximise the protection of pans and habitats of conservation importance. Furthermore, plants of conservation importance could need to be relocated where practical. As the requirements to undertake the above will only be determined once the EMP has been completed, it is not possible to allocate a cost to the above and it is seen as a risk.

Groundwater: The project area is located in a groundwater rich area, although groundwater levels do vary significantly across the project site as a result of aquifer morphology. Although adjacent mines have lowered the water table in the region, it is expected that dewatering of the aquifers will be necessary to allow mining to proceed. This could further lower the aquifer and there is a risk that adjacent water users could be impacted.

Contamination: As the minerals to be mined are relatively chemically inert, there is a low probability that soil and water contamination will occur as a result of mining, creating overburden stockpiles or mineral processing. However, if proper maintenance and environmental controls are not implemented around hydrocarbon management, there is a risk that both soils and groundwater could become contaminated.

Closure planning: Sishen Mine is currently undertaken rehabilitation trials to determine final waste rock rehabilitation requirements in terms of slope angle and thickness of topsoil cover. The results of this assessment will only be available in 2007. In the absence of these results it has been assumed that the waste rock dumps that will be created at Sishen South will be grade down to 18° from the angle of repose (30°). Based on this assumption it has been calculated that the rehabilitation costs associated with the dumps that will be created will be ZAR35.5m (assuming a 3Mtpa output). The demolition costs for the proposed infrastructure have been assessed to be ZAR9.5m. Additional costs (monitoring and maintenance; owners costs and contingency) have been assessed to be ZAR10.8m. The total closure liability at the feasibility stage of the project is therefore ZAR55.8m. It must be noted that this does not make any provision for hydrocarbon cleanup in the event that there are spills during the operation of the mine, or does it make any provision for the backfilling of opencast pits. Provisions have not been made for the backfilling of the pits as it is assumed that they will remain open at the end of the life of mine. If the authorities require that EMP commits to backfilling the pits at the end of the life of mine, it is estimated that these costs could range between ZAR50 – 100m. This money is therefore seen as a sensitivity analysis cost to the project.

11.6.1  

Introduction

The Mine, constructed in the mountains surrounding the town of Thabazimbi, extracts iron ore from a series of open pits excavated into the mountainside. Waste rock is disposed of on the mountain slopes adjacent to the pits. The area surrounding the town is relatively arid and is primarily used for game farming activities. The Mine is the only significant industry in the area.

11.6.2  

Environmental Compliance

The Mine, currently operating under an EMP approved in 1995, is busy compiling a new EMP as part of its MPRDA conversion. The driver of the conversion was originally to include the proposed Phoenix Project, however the Mine has taken a decision to include the entire operation in a single submission. A SLP is also under development. Water uses on the Mine have been registered and the Mine is in the process of applying for a water use licence (second draft submitted end of July 2005), including an integrated water and waste management plan.

Thabazimbi is ISO 14001 certified (November 2004). A single surveillance audit has been conducted since certification and did not report any major non-compliances. The Mine undertook an enviro-legal audit in September 2004. The aspects identified were rated from 1 to 4 with 1 being low risk and 4 being high risk. The aspects that have not yet been closed out and have a rating of 4 include: the lack of documentation relating to safe disposal of waste sent off-site; lack of formal documentation relating to the closure of the Mine’s domestic waste dump; the requirement for further monitoring at the domestic waste dump; the potential for pollution during handling of SANS 10228 listed substances (hydrocarbons); hydrocarbon contamination of soil, surface and groundwater; inadequate separation of clean and dirty water (GN 704); and the potential that groundwater supplied to the town as drinking water may become contaminated. A programme is being followed to close out on these issues.

11.6.3  

Environmental and Social Management

Environmental management is the responsibility of the environmental manager, who is assisted by a local contractor on an ad hoc basis. The primary responsibility of the contractor is to reduce the backlog of un-rehabilitated waste rock dumps. Where necessary, the Mine employs consultants on a project basis. Social management is the responsibility of the Regional Manager – Sustainability (Limpopo). The operational environmental budget for the facility is ZAR7mpa. This includes a ZAR2m contribution to the Mine’s closure fund, with the remainder utilised for waste rock dump rehabilitation, specialist studies, ISO audits and environmental monitoring. SRK is of the opinion that the operational budget is insufficient to meet the Mine’s requirements, particularly with regard to addressing the rehabilitation backlog on the waste rock dumps and suggests an additional ZAR1.5mpa would be appropriate.

11.6.4  

Environmental Issues

Waste rock dumps: The waste rock dumps, constructed on the mountain slopes adjacent to the pits, are constructed by end tipping the waste, creating a dump at the angle of repose 37°. The current remediation strategy (as per the EMPR) is to re-profile dump crests to 20°, excavate small excavations (approximately 2m x 2m) in the re-profiled areas into which various grasses and trees are hand planted. DME has indicated a concern with regard to dump stability, which may require the re-profiling of the entire dump to a less steep angle (no angle has as yet been specified by the DME). Re-profiling may be impractical, as there are space limitations on increasing the footprints. Should there be a requirement to re-profile the dumps, existing vegetation would be destroyed, resulting in the need to re-vegetate all re-profiled surfaces. SRK proposes a sensitivity contingency of between ZAR50 and ZAR75m for the civil work and the vegetating costs.

Hazardous material handling: The waste rock and tails from the plant are reported to be inert and there is no evidence of significant chemical contamination. Hazardous waste in the form of used hydrocarbons and associated containers is generated by the Mine. These are collected and stored on site until they are removed for recycling by a third party. The storage facility, which is on hardstanding, surrounded by a bund, appears to have insufficient capacity to contain the material generated. It is estimated that the cost to increase capacity is between ZAR0.1m and ZAR0.25m. Fluorescent tubes are crushed and are stored on site as there is currently no suitable pathway for the Mine to dispose of this material. It is estimated that the disposal cost at a hazardous waste site would be ZAR0.1mpa.

Water contamination: Although the waste rock and tails are inert, there is sometimes a problem with the suspended solid load that reports to the Crocodile River, via the Beerspruit. It is also reported that the nitrate levels in the groundwater near town are slightly elevated, but still within the DWAF drinking water guidelines. The primary source of nitrates is suspected to be treated sewage effluent that is used in the washing process. Monitoring data indicates that there have been instances when the soaps, oil and grease concentrations in the Crocodile River have been elevated, indicating hydrocarbon contamination from the Mine. Although there are instances of hydrocarbons being detected in the groundwater in boreholes adjacent to the workshop area, it is reported that hydrocarbons are not detected in the Mine’s groundwater supply boreholes providing town with water.

Possible decant: Dewatering of the aquifer around the Donkerspoort West pit is currently undertaken and the Mine is currently not sure what the rebound level in the pit will be after mining and de-watering has stopped. Although, there is a possibility that the rebound level could be such that there is decant to the surrounding environment, this is not seen as a liability as the quality is expected to be acceptable for discharge.

Soil contamination: Limited soil contamination has arisen through poor hydrocarbon containment at a number of areas on the Mine (particularly around the workshops). Neither the closure cost nor the operational budget appears to have a provision for cleanup of these areas. It is estimated that cleanup will cost between ZAR1 – 5m.

Land degradation: The various pits and waste rock dumps that make up the Mine are likely to be permanent features in the landscape as there are no plans to backfill the pits. Sinkholes have formed through the collapse of underground workings. These sinkholes pose a safety risk to the Mine with the result that access to these areas has been limited. Either permanent access control will be required (thereby preventing a walk away solution) or backfilling may need to be considered, although potentially impractical. As this has not been fully considered in the closure liability (see below), there is a risk that major costs could be incurred.

Air emissions: Dust is a nuisance to the local community, resulting in some complaints. The Mine hopes to reduce dust through the application of a coating (Dust-a-Side) to the haul roads. The Mine is also investigating dust reduction mechanisms at the plant and crusher. There was a claim that mine workers where getting sick as a result of exposure to dust, however, medical tests indicated that the workers were being affected by emissions from the adjacent andalusite mine. Limited dust monitoring is undertaken on the Mine, with the monitoring program still in its infancy. With appropriate management, the risk is considered to be small.

Community relationships: The Mine’s philosophy is to supply expertise to the local community as and where required, as part of its “Volunteerism” project, to assist the community with preventative maintenance on the town’s infrastructure. It is estimated that the key role players on the Mine invest up to 10 hours a month assisting the community. The Mine has created a skill development centre, where the local community are trained in a trade that can be utilised in the area. Besides the development of a trade skill, the community members are given basic life skills (computer literacy, basic accounting and basic marketing). The Mine is also investigating the feasibility of developing a company that will allow small scale miners to recover high grade ore, by hand, that cannot be mechanically mined.

Closure planning and costing: The Mine has not developed a closure plan, although there are various commitments in the EMPR regarding closure requirements. Based on these, the Mine has assessed its immediate closure cost (June 2005) to be ZAR64m. This includes ZAR26m for demolition costs and ZAR38m for rehabilitation costs. The primary expense associated with rehabilitation appears to be the downsloping of the upper portions of the dump, the excavation of depressions for vegetation and the planting of grass.

There does not seem to be an allowance for any restoration of the footprints where infrastructure is removed, nor does there appear to be an allowance for the remediation of areas where hydrocarbons have been spilled. Assuming that no re-profiling of the dumps is indicated, SRK is of the opinion that the rehabilitation costs are insufficient, with there being a shortfall liability of ZAR13 – 37m to complete the rehabilitation as planned. SRK has therefore increased the environmental costs associated with closure by some ZAR22m. Based on the information available, SRK is of the opinion that the ZAR26m for demolition is sufficient. If the Mine is required to re-profile the waste rock dumps, it is expected that the costs incurred will be approximately R50 – 75m over and above the ZAR64m budgeted.