Here are some guidelines for a due diligence examination of a mine waste disposal facility. Let us call these the AMEC Principles in honor of the folk who wrote the paper from which I cull these principles, namely Davies, Lighthall, Bleiker, and Daniel, all of AMEC in Canada. They write in a recent CIM paper Due Diligence of Mine Waste Facilities – the Basics: “This paper presents a recommended framework for completing either an audit or a due diligence assessment of mine waste facilities.”

They recommend that you ask if there is sufficient information with regard to the following to establish adequate stewardship of the facility:

  • Foundation conditions
  • Climatic conditions
  • Tectonic setting
  • Tailings and waste rock properties
  • Operating criteria
  • Monitoring and ongoing evaluation
  • Reclamation and closure plans
  • Regulatory requirements
  • Significant social and environmental issues.

They note that surveillance is a critical aspect of facility condition and hence recommend that you confirm the surveillance program incorporates these elements;

  • Confirm that the facility is safe and is performing in accordance with design criteria and objectives.
  • Confirm design assumptions and adjust ongoing design and construction as necessary based on observed versus assumed conditions.
  • Identify failure modes that can be detected (and those not able to be detected.)

Hence they recommend that you confirm that the surveillance program includes these provisions (I edit for clarity and brevity):

  1. Collection of data to confirm performance
  2. Redundancy in the data collected to confirm performance
  3. Trained personnel to collect and interpret the data
  4. Availability of resources to implement surveillance programs
  5. Maintenance of instruments
  6. Appropriate interpretation and presentation of performance data
  7. Definition of trigger levels and appropriate response actions
  8. Definition of lines of responsibility and communication
  9. Regular designer review and input
  10. Documentation and data management
  11. Review and updating of the surveillance program
  12. Periodic independent audit by an expert
  13. An Operations Plan and a Closure Plan.

With regard to risk management, they urge you to ask these questions and undertake a FEMA analysis:

  1. What can go wrong?
  2. How likely is it to go wrong?
  3. If it happens, what are the consequences?
  4. What can be done to reduce the likelihood and consequence of something going wrong?

Hence they conclude:

The crux of the audit and/or due diligence of a mine waste facility is not what can be observed in a quick site visit or perusal of available documents. The key is to unearth what is not obvious and what others have missed….The ramifications of missing a potential flaw may be no less damaging to the mining venture than an overstatement of mining reserves that lead to a flawed development decision.