There are few mines in Costa Rica. Tourism is more lucrative. And it seems so too are displaced Americans and Canadians building houses at bargain basement prices.

There will probably be even fewer mines in Costa Rica once the problem at the Bellavista mine becomes common knowledge. Here is an edited version of the news report I saw:

Shares of Glencairn Gold Corp. fell after the company suspended operations at its Bellavista Mine in Costa Rica, citing the risk of a cyanide spill and ground movements that may compromise containment of cyanide used to dissolve gold from crushed ore. The earth movement - up to one centimetre a day in some parts of the leach pad and waste pile - is attributed to years of unusually heavy rain.

“Based on earth movement patterns in Costa Rica, the geological structure at the site and the opinions of its experts, the company does not believe that there is a risk of sudden earth movement at this time,” Glencairn stated. “However, continued small movements could compromise the sub-liner, liner and drain system.”

Glencairn said the mine closure is a “precautionary measure until a full technical analysis has been completed and required remedial action has been implemented.”

Gray said the company first noticed earth movements as early as May. “Monitoring since then has revealed that the movements have been identified in the range of one centimetre per day,” Gray said, adding the company has stated the movement in part is caused by water saturation due to abnormally high rain fall during the past several years.

“We are taking a conservative approach with our valuation and are assuming that the ground movement problems will take one year to resolve and mining will not restart until August 2008,” wrote Gray.

I am intrigued to read that it will take a year to stop movement of a heap leach pad that is obviously saturated and in a state of failure. At its current rate of movements, they clearly have reason to be concerned about the integrity of the liner, which if breached and torn would let seepage from the pad pass to the ground beneath and presumably the groundwater.

But there is something profoundly wrong with this news report. First, a heap leach pad should have a series of drains at the base of the pad. Theoretically these drains should be able to accept any seepage down through the heap leach pad materials. The drains of a conventionally designed heap leach pad ensure that seepage through the pad is vertically downwards. At Bellavista this does not appear to be happening. Are the drains blocked? Are they inadequate? Have they been rendered inoperative by the reported movement?

Next is the reported movement: one centimeter a day. That is a lot of movement. That’s nearly ten feet in the year they plan to be shut down! I would be panicking if I were staring at a failing heap leach pad moving at that rate.

Next is the absence of any action. Many years ago on the South African platinum mines. I faced similar rates of movement of tailings dams. We had the trucks in there building stabilization berms and embankments well before issue of the press release.

Then there is the strange fact that the mine would appear to have only one heap leach pad, and that they cannot mine while that one is out of action. Seems to me there should be another areas for another heap leach pad, or at least another part of the pad where they can put newly mined material.

So before I bought shares in the hope of profits to be made of mines in Costa Rica, I would ask for a lot more technical and engineering information.