There must be a story about the failure of mining technology lurking in this press release—or is it a story of human nature—or maybe a story of prudent business/politics?
The press release reads:
Following the completion of a three month review of the Vatukoula Mine in Fiji, Emperor Mines announced that mining operations are no longer economically viable and they will be closing the mine, with production ceasing immediately. Pending completion of a review to optimize its value, Vatukoula will be placed on care and maintenance. Mine management plans to consult with unions, community leaders and the National Government of Fiji about the implications the mine closure will have on the workers as well as the country as a whole.”
Some technical background on the mine from the InfoMine files:
- Geology: Vatukoula is a low-sulfidation epithermal gold vein deposit associated with alkaline type igneous rocks in a volcanic setting. This volcanic setting and rock type is typical of several major gold mines in the southwest Pacific region such as Porgera and Lihir. The ore deposits lie predominantly along the margin of the Tavua volcanic caldera. See also this link for cross sections and maps of the geology.
- Operations: The Emperor/ Vatukoula mine, the only significant producing gold mine in Fiji, has been in operation since 1933, with 6.7 million ounces of gold having been mined since operations commenced. In addition to the estimated resource of 0.4 million ounces at Tuvatu and 0.3 million ounces in tailings, the mine’s current estimated resource base is 4.0 million ounces of contained gold.
Here is my summary of previous 2006 news reports on the mine—all relevant to the question of the role of mining technology failure.
- In the quarter ended Mar31/06, the implementation of the new “Accelerated development and training plan” was designed to introduce flexibility to production areas, to improve infrastructure and increase the productivity of the workforce.
- As of Jun30/06, with the temporary shutdown of the mine on 20 April and gradual start-up in early June, tonnage treated for the June quarter was only 23,099 tonnes (92,325), 75% less than the previous quarter. Cash costs per ounce increased by 2% to $US660/oz ($US648).
- On Oct 16/06, reported that a serious incident involving a mine shaft conveyance occurred in Philip Shaft at the Mine during the evening of Oct 14/06. During testing of the shaft conveyance following maintenance, a skip-cage fell down the shaft, causing damage to the surface winder mechanism. The Company states that the shaft will remain closed for some time as investigations continue and while repairs are undertaken.
On Nov 14/06, announced that production at the Philip Shaft recommenced earlier than anticipated, following repairs to damage to the shaft following a shaft conveyance failure on Oct 14 this year.
Turning to the Emperor Mines Limited 2006 Annual Report for the human story.
“Frazer Bourcher—General Manager Vatukoula. Frazer joined Emperor in August 2006. Prior to joining Emperor, Frazer was with Placer Dome as the Pogera Mine Manager. Mr. Bourchier, a qualified mining engineer with a Bachelors of Applied Science and a Masters of Applied Science from the University of Toronto, Canada, has more than 16 years experience in the gold mining industry, predominantly with the former Placer Dome Group. Over the past 10 years he has held senior management positions in Canada, South Africa, and PNG. Prior to his duties at Porgera, Mr. Bouchier was Operations Manager at the Misima mine, also in PNG.”
According to the annual report, Mr. Boucher’s contract, commencing August 2006, provides for an annual salary of $300,000 and no termination benefits.
In the June 2006 Annual Report is this statement about community relations: “At Vatukoula, community meetings in conjunction with Community Policing committees continued throughout the financial year in all six village areas. The turnout and interactions at these meetings were very encouraging, with numerous issues affecting the community being discussed and resolved in open forum. Issues such as absenteeism, safety and mine’s performance and restructure were discussed at this forum (sic).”
And on Employee Relations: “The workforce at Vatukoula decreased by 146 employees during the year to 1,837 employees at year-end. Of that 1,837, there are 120 employees stood down from work on a redundancy list. In December 2005, due to the mine’s poor production levels and financial position, a total of 141 employees were temporarily stood down with about 180 contractors and 54 temporary and probationary employees terminated. The 141 employees were reinstated in January 06. The mine temporarily shut down in April 06 for restructure and all employees except the essential service workers were stood down. During the stand-down period employees were paid annual leave. On completion of annual leave, each employee was paid a $50 food voucher. Employees who stayed on mine site were allowed to stay rent and electricity free. Employees living outside the mine site were compensated with $25 cash each week. Beginning 24 April, employees were called back in lots of150 – 200 and were put through the re-structure induction. This was completed at the end of June 06, when all employees, except the 120 to be made redundant, had been recalled.”
On Environmental Results: “Four environmental incidents were reported, including one related to a fish incident at the Lololevu creek. The other major one involved a pipeline failure (pinhole) along a section of the Toku tailings pipeline resulting in slime coverage over a 30m x 30m compound of a local resident.”
The annual report notes only that in 2005 the mine undertook “data collection for research project on arsenic speciation of our wastes,” and in 2006/7 will “continue research into arsenic speciation and characterization.” More data are available at this site.
To seek out the true story, I turned to the web. Wikipedia is right up to date: “Vatukoula is a gold mining settlement in Fiji, 9 kilometers inland from the Town of Tavua on the island of Viti Levu. It was established in 1934. The Emperor Mining Company owned the mine but shut it down in December 2006 since absenteeism by Fijian miners made it uneconomical to continue mining.” So much for those community meetings!
Probably only historical and now certainly moot, the Oxfam Mining Ombudsman Case Report: Vatukoula Gold Mine (undated) provides background and recommendations, probably none of which have been of will now need to be implemented. Also historical and moot is the 2003 Pacific Ecologist’s “plea for justice for Fiji’s mining communities.”
To their credit, there is no mention in the 2006 Annual Report about sustainable development. I would love to hear my friends, who so loudly espouse the concept, explain its implementation at this mine. The report does, with a sideways glance, mention (lower case) responsible mining, saying: “commitment to integrate responsible environmental practices into the mining and milling operations to minimize environmental impacts.” I am sure they do not intend to implement the principles of (upper case) Responsible Mining.
It is always sad when the inevitable happens—namely a mine closes. For example, the community may never get what they have at Porgera: “During May 2006, the Porgera Clinic opened the AIDS Care Center which offers day care for AIDS patients, advice to their carers (sic) and families, and general advice to the community.” Maybe once the process of “completion of a review to optimize its (the mine’s) value” is undertaken? I for one look forward to the news release that the mine is re-opening and is doing everything a mine can, in this day and age, do for a community and a country.