Brewery Creek lawsuit raises questions
Mining regulations and financial security are meant to protect people from the environmental and financial risks attached to exploration and mining. Simply put, they’re tools regulators use to try and make sure that the costs of development don’t outweigh the benefits. Unfortunately, these tools aren’t always put to proper use.
A glaring example is Wolverine Mine, where the Yukon government was slow to calculate and collect financial security. Yukon Zinc walked away from the mine and $25 million in outstanding security, leaving taxpayers with the bill for water treatment costs, plus unknown millions for future clean up.
The recent lawsuit brought against the Yukon Government by a former chief mining engineer raises serious questions if much has changed. The lawsuit alleges that Yukon Government ignored the engineer’s assessment of the Brewery Creek project, where he found Golden Predator would owe $12 million in security to restart the mine. Instead, he claims that the government cleaved $11 million off his assessment without explanation, leaving security for Brewery Creek at $1 million.
An explanation for the alleged 92 per cent discount isn’t available, since Yukon Government doesn’t publicly share how it calculates mining security, only the total held for each project. Scanning through these totals, available on the Yukon Government mining security website, actually raises more questions than it answers.
An even figure of $1 million in security for Brewery Creek stands out as odd against other more exacting amounts, like the $30,780,939 held for the Eagle Gold Mine. Where did this round number come from, when financial security is typically calculated to the dollar, based on spreadsheets chock full of the estimated costs to clean up a site?
Scanning further down the list of security totals raises even more questions about adequate security coverage, like why does the government only hold $672 for the Casino exploration project? Yes, this project is in the exploration phase, so the project liability and resulting amount held in security will be lower than an operating mine. But how is it that the damage deposit for my 1,300 square foot apartment is more than double what Yukon Government holds for an 1,100 claim project that includes trails, trenching, bulk sampling, overburden waste dumps, fuel storage, an airstrip and a camp?
The answers to these questions should be easier to find. Moving forward, mining security calculations should be done through a third party, independent of the mining company and the Yukon Government. Calculations should also be transparent and subject to public scrutiny. One avenue would be to ask YESAB to incorporate a review of security as part of the socio-economic and environmental assessment process. For those who argue that financial security calculations should be confidential due to corporate competitiveness concerns, it’s worth noting that the Yukon Water Board hearings for large mines include a review of financial security calculations relating to water issues. Reviewing security early in the assessment process will enhance public confidence, ensure financial security covers all aspects of a project’s potential closure and remediation, and allow regulators to fulfill their duty to shield the public from environmental and financial risks.
Randi Newton
Conservation Manager for CPAWS Yukon
To a litter fairy
To whomever cleaned up the parking areas and dog walk trails on the east side of Schwatka….what a good job! So pleasant and much appreciated. Thank you.
Kathy Piwowar
Whitehorse
To the Yukonomist
The classic eco-default of comparing the Yukon’s carbon footprint to other countries with mild or no winter, full transportation infrastructure and miniscule land mass is comparing foxes to elephants.
When the Yukon has rail systems connecting all our communities and all our towns have stores, farms, shopping malls, factories and high rises, and when our winters become three months long THEN comparatives can be made.
Chris Caldwell
Whitehorse