Rehabilitation and Surrender
Resources companies are committed to rehabilitating land to a state where it can be passed on safely and sustainably for the next land use
During operations, resource developments bring significant benefits to regional communities and Queensland. However, these developments have a limited lifespan and provide one of many alternative land uses over time. As such, resource companies understand the importance of rehabilitation and returning the land to a state where it can be passed on safely and sustainably for the next land use.
The resources sector’s approach to rehabilitation has improved significantly over past decades in line with emerging techniques, evolving corporate values, community expectations and law. These advances in rehabilitation have resulted in a modern regulatory framework, which is supported by an ongoing commitment by the resources sector to refine and develop innovative methods for rehabilitation.
Rehabilitation is an important part of the resources sector’s environmental performance and is effectively considered as another component of operations. The sector does not consider rehabilitation as something that begins towards the end of the operation, but rather a process that begins in the planning phase and is progressively sequenced throughout the life of the operation.
The resources sector is advancing rehabilitation in Queensland and showcasing its commitment and exceptional stewardship in attaining on-ground results.
How is rehabilitation regulated?
Individual site rehabilitation requirements are set through relevant environmental authority (EA) conditions established by Government under the Environmental Protection Act 1994 (EP Act). Implementation of these conditions is provided through the Plan of Operations, which provides a regularly updated schedule for extraction and rehabilitation targets, and outlines the activities that will deliver a safe, stable, non-polluting and self-sustaining landform consistent with the agreed next land use/s.
With the introduction of the Mineral and Energy Resources (Financial Provisioning) Act 2018 (MERFP Act), the above process is to change by 1 November 2019 (at the latest) for mining activities although petroleum and gas activities will largely be unaffected for the time being. The State Government has established a new life-of-mine planning (i.e. commencement through to relinquishment) instrument – a Progressive Rehabilitation and Closure Plan (PRCP). The Plan is to:
- Describe the intended post-mining land use or non-use management area;
- Outline rehabilitation techniques for achieving the post-mining land use or management measures for a non-use management area;
- Map where mining and rehabilitation activities are forecast to occur; and
- Set binding (enforceable), time-based milestones for actions that achieve progressive rehabilitation or management outcomes. Note that this is dependent on when land becomes available for rehabilitation.
Where possible, the Government and companies are seeking to maximise post-mining land uses for ongoing utilisation by the next landholder.
Post-mining land use and non-use management area
All rehabilitated mined land must be safe, stable and non-polluting and:
- Returned to a post-mining land use (e.g. grazing, native vegetation, industrial, forestry, renewables); or
- Managed as a non-use management area (e.g. void with low quality water).
It is important to note that a void can have a post-mining land use (e.g. stock water if quality is suitable, habitat, general use water storage and transfer).
A milestone is an activity (or step) necessary to rehabilitate the land or manage/minimise the risks to the environment. There are two types of milestones:
- Rehabilitation milestones for achieving the post-mining land use; and
- Management milestones for management of a non-use management area.
In either case, examples of milestones may include:
- Installation of cover system/cap;
- Reshaping/reprofiling to achieve stable final landform;
- Topsoil placement; or
- Revegetation (e.g. seeding).
Land ‘available for rehabilitation’
The first step in developing a PRCP schedule of milestones and associated timeframes is understanding when land is ‘available for rehabilitation’. As defined in the MERFP Act, land is available for rehabilitation unless:
- It is being mined (e.g. coal face activities, overburden emplacement areas, health and safety/geotechnical hazard exclusion areas);
- It is needed for operating infrastructure and machinery (e.g. coal preparation plant or metal refinery, tailings dams, workshops, storage facilities, dams for water storage, roads or other access, buildings, levies or watercourse diversions);
- It is needed for permanent infrastructure (which may include any previously operating infrastructure or machinery to be used or retained as an asset); or
- There is a reserve that is to be mined within 10 years. Note there will be regulations developed to accommodate operations where areas may still not be available upon and after 10 years. For example, a pit is open and inactive for a period of 15 years to allow access for approved underground operations.
Once land is available, companies must work towards delivering the milestone as soon as practicable and forecast when the milestone will be achieved.
For both mining and petroleum and gas activities, companies are required to demonstrate that rehabilitation is being achieved through routine monitoring and reporting to the State Government to maintain compliance and in recognition of retaining a social licence to operate. This is provided in an Annual Return. Where a PRCP for mining applies, the Annual Return must also include an evaluation of the effectiveness of the schedule of milestones.
Supporting statutory guideline
The detailed requirements of a PRCP are currently being established by the State Government, in consultation with QRC, the mining sector and other stakeholders, as part of the development of a statutory guideline. When preparing a schedule of milestones and associated mapping, QRC is advocating for the guideline to afford sufficient operational flexibility to facilitate changing external factors (e.g. market and weather).
The draft PRCP guideline will be released for public consultation in Quarter 1, 2019. The final guideline must be ready for implementation ahead of the commencement of the PRCP framework, which must be no later than 1 November 2019.
Queensland has a system authorised under the EP Act which allows for Government, who must be confident that relevant conditions have been complied with and rehabilitation has been completed satisfactorily, to sign off (or certify) an area prior to relinquishment. However, it is important to note that resource companies continue to remain responsible for the ongoing upkeep of certified areas until relinquishment.
Progressive certification provides the resources sector with regulatory certainty when carrying out rehabilitation and gives the sector confidence that rehabilitated areas will not be subject to future changes in requirements or expectations over time.
Since early 2016, QRC and the resources sector has taken a proactive approach, through the testing of real rehabilitation case studies, to assist the State Government in determining how to best utilise and consistently implement the certification framework.
On 2 June 2017, Glencore’s Newlands was the first open cut coal mine to receive certification for approximately 73 hectares of rehabilitation associated with part of an overburden emplacement area. This milestone provided a constructive way forward for both Government and the mining sector in encouraging further certification of progressive rehabilitation. Glencore’s success was also acknowledged by Government. To learn more about the rehabilitation at Newlands and other certification case studies click here.
The State Government requires proponents of all resource activities to provide financial security prior to the commencement of approved activities. This payment is a guarantee that the State holds adequate funding for rehabilitation of sites in the event that a person or company defaults on its obligations.
Under the current EP Act, the financial security framework is termed financial assurance. However, with the introduction of the MERFP Act, the framework for which financial assurance is managed and calculated for resource activities is to change by 30 June 2019.
The MERFP Act establishes a new financial provisioning scheme (the Scheme) and a Scheme Manager (i.e. Queensland Treasury). The Scheme Manager assesses resource sites individually having regard to:
- The financial risk (soundness) of a solely-owned company or an entity of a joint venture (or parent company); and
- Attributes of the site itself, including project strength (economic life based on reserves or off-take agreements), rehabilitation completed and compliance. These attributes inform the likelihood (or level of risk) of a site being considered attractive for sale to another party in the event its current owner enters into administration.
The risk categories include very low, low, moderate and high. The Scheme Manager decides, based on the risk profile, if financial security is to be paid via:
- Pooled fund (the Fund) with three tiers – company is very low, low or moderate risk; or
- Surety (e.g. bank guarantee or insurance) – company is high risk.
Financial security under the new Scheme is termed an Estimated Rehabilitation Cost (ERC). It is to be determined in accordance with a Government-developed calculator.
If a company is to pay into the Fund, the contribution is the ERC multiplied by the relevant percentage associated with one of three tiers based on risk (i.e. very low, low, moderate).
Surrender and residual risk
While activities undertaken by the resources sector generally continue for many years and in some cases decades, they are still temporary in nature. Upon approaching, and at the time of, closure the priority for the resources sector is to:
- Minimise credible residual environmental risks; and
- Provide a safe, stable and non-polluting rehabilitated landform that is generally available for future use.
Surrender of an EA and related resources tenement is only granted once the State Government is satisfied that all environmental requirements, in particular rehabilitation, have been achieved. Only at this stage can the any future liability of the EA holder for the land within the tenure be absolved.
The existing regulatory framework for relinquishment and residual risk is currently under review. QRC and its member companies are consulting with Government on the proposed reform, which is to continue through 2019.
Care and maintenance
‘Care and maintenance’ is a term used in the mining sector to describe the status of a non-operational mine site where there is potential to recommence works at a later date. The decision to move a site into care and maintenance is a major decision for a mining company with all potential impacts carefully evaluated. One factor influencing this decision may be low commodity prices, which are often cyclical. Under these circumstances, a company may choose to manage the site until economic conditions are favourable to recommence operations.
There has been concern expressed by some external stakeholders that care and maintenance equates with premature closure of a mine, however, this is not the case. It is important to recognise that under Queensland’s regulatory framework, although periods of care and maintenance may last several years, the ongoing environmental liability for the site, including rehabilitation, remains with the company. It is not relinquished until Government requirements have been met. Care and maintenance should also not be confused with abandonment, which is safe-guarded by financial provisioning mechanisms.
In any case, care and maintenance is accounted for by new provisions under the MERFP Act, whereby the Scheme Manager is to be notified where there is six months of no production, and hence able to monitor any financial risk moving forward.
Abandoned mines are a legacy from historical operators before modern mining practices and environmental management and mine rehabilitation regulations were in place as they are today. The Queensland Government defines a site as an abandoned mine when a mining tenure no longer exists and there are no legal avenues requiring the company or individuals that created the mining disturbance to carry out remediation.
There has been a range of public communications from non-industry groups that 15,000 abandoned mines in Queensland. The Department of Natural Resources, Mines and Energy’s Addressing the State’s Abandoned Mines Legacy Discussion Paper (the Discussion Paper) states that:
“…estimated reports of 15 000 abandoned mines can be misleading given the vast majority are very small and do not share characteristics common to a contemporary mine. A very high percentage of these sites were mined in the ‘gold rush’ of the late 1800s to early 1900s using relatively unsophisticated methods, such as hand tools, with small disturbances to the land. These historical sites were mined before the introduction of strict environmental regulations“.
According to the Department’s analysis presented in the Discussion Paper:
- 120 legacy mines. These sites ceased production prior to the EP Act amendments in 2000 and have features
in common with a contemporary mine created by mechanised mining methods
- Four sites terminated mines. These sites ceased production after the EP Act amendments without fulfilling rehabilitation obligations. That is, as part of liquidation, the mining leases were disclaimed and responsibility for managing the former mine sites and associated liabilities left by the operators has reverted to the State Government.
QRC fully supports the Department’s analysis and the supporting context.
The Abandoned Mine Lands Program, administered by the Department of Natural Resources, Mines and Energy, progressively assesses abandoned mine sites and takes action to reduce significant environmental and public health and safety risks. While there are such initiatives underway aimed at addressing abandoned mines, QRC and its member companies are focused on undertaking operations responsibly and delivering on rehabilitation requirements in accordance with strict environmental conditions and regulations, including new requirements introduced under the MERFP Act. This focus is to ensure that no further abandoned mines are created in Queensland.
The Department is currently undertaking an exercise to prioritise funding and rehabilitation works for legacy and terminated mines. Such efforts will be supported through contributions generated via interest from the Fund once the Scheme is well established.