Mine Closure

The responsible closure of mine sites is critically important to the collective reputation of the mining industry. If we, as miners, cannot point to our strong track record of responsible operation and closure of mines, it will become exceedingly difficult for miners to advance new mines in the future. During mine closure, New Gold’s aim is to restore all possible parts of our sites to a level of productivity equivalent to pre-mining capacity or to an alternative land use determined through consultation with local communities of interest.

Mine closure is a material topic for New Gold in 2017, not only because we are currently in the process of closing our Cerro San Pedro Mine but also because planning for closure is a critical part of operating mines responsibility.

Description of Impacts

Closure of an operation leads to significant declines in economic activities at and around the mine. This includes declines in employment, local procurement, community investment and infrastructure development. Environmental aspects of mine sites must continue to be managed throughout the closure process and beyond the completion of closure activities. On both the economic and environmental fronts, we must plan effectively to mitigate impacts and risks to local communities and the local environment.

Management Approach

We start planning for a mine’s closure when the mine is still in the design stage. Each of our mines has obtained regulatory approval for its closure plan, and this is updated regularly throughout the mine’s life. New Gold operations practice progressive rehabilitation of historic mining areas and lands affected by our activities as soon as areas become available. We also understand the importance of doing our best to alleviate broader socio-economic stresses associated with closure.

Based on best practices and to capture knowledge gained from our experiences with Cerro San Pedro’s closure program (discussed below), we created the New Gold Integrated Closure Standard in 2015. This standard is being rolled out across the company and will provide guidance to sites regarding closure planning. The standard emphasizes the need for adequate financial and human resources that help ensure local communities’ interests are understood and considered during closure planning.

Reclamation and Remediation

At New Gold sites, environmental stewardship includes applying restoration practices to lands that are affected by mining to promote biodiversity. On-site restoration includes a wide range of activities such as seeding, replanting, subsidence work of filling or capping mine shafts, and removal of contaminated material. In 2017, more than 168 hectares of land was undergoing reclamation at New Gold sites, a 33% increase from 2016.

At New Afton, we have been working diligently towards developing indicators of successful remediation. New Afton has collaborated with the University of Guelph and its Barcode of Life project to use innovative technology in the area of genomics to measure differences in arthropod (insects, spiders, etc.) numbers and diversity between a disturbed and undisturbed site. By measuring these parameters, the site can optimize the composition or density of the vegetation structure to ensure the ecosystem left after final reclamation is functional. New Afton has applied this innovative technology to one round of sampling and seeks to do further sampling programs in the future to gauge its success as time goes on. Knowledge gained will be shared internally and with regulators, partners and communities of interest, to improve the success of reclamation efforts at and beyond our sites.

Peak Mines has also put a considerable effort into rehabilitation. At two sites in particular – Gladstone and Silver Peak – we have used small-scale absorption banks to make the most of the local area’s limited rainfall. Both sites are located on natural hill slopes and were subject to accelerated levels of surface erosion. The technique of absorption banks involves forming banks along the contour approximately 10 metres in length. The end of each bank is made slightly higher, enabling water to pond against the high side of the bank and encouraging growth. The addition of leaf litter and branches assists in minimizing soil erosion from rainfall run-off and provides coverage for the establishment of new growth. Seeding the site with native grasses has proven rewarding, as new growth has successfully been established.

Cerro San Pedro set a goal to reforest a total of 373.4 hectares of land in areas surrounding its operation, and by 2016, this goal had been exceeded with the assistance of volunteers from the local communities. The mine produced over 70% more plants at the on-site nursery than what had been set as an initial goal.

2017 Mine Closure Performance Spotlight

  • In 2017, 317 hectares of land were undergoing reclamation1, more than double of the undergoing reclamation in 2016. At Rainy River alone, 140 hectares were reclaimed in 2017. At New Afton, more than 114 hectares were undergoing progressive reclamation.
  • At Cerro San Pedro, 35 hectares were under reclamation as part of the mine’s closure plan, which is double the area undergoing reclamation in 2016. We have removed all historic tailings materials from the Patio Victoria contaminated site (2.2 hectares), which is located outside of our mining lease, but which we have committed to remediate.
  • The Integrated Closure Program at Cerro San Pedro partnered with five local organizations to provide about 429 skills-training hours in eight local communities. The programs offered a total of 384 seats, of which 90% were taken by local women.
  • During 2017, the Entrepreneurial Development Program at Cerro San Pedro provided direct assistance to 124 local community members and mine employees working on the development of small local businesses. To date, 17 small businesses have been assisted, of which almost half are owned by women.
  • The Todos por Cerro de San Pedro Foundation launched a microfinancing program and provided its first microloan to a local business.

Integrated Closure at Cerro San Pedro

In 2016, we ceased active mining operations at Cerro San Pedro. At the centre of our closure activities is our aim to ensure we leave a positive legacy for the communities surrounding this site. Our objective is to maximize the creation of alternative opportunities for our employees and local residents as we close the mine.

In 2017, we continued the implementation of a detailed plan guiding workforce reductions and redeployment. To minimize effects on our people during this difficult transition, we have initiatives such as training programs and workshops developed by local and non-local public and private institutions.

For our employees and contractors, our outplacement plan has offered a set of preparation courses to improve job search, interview, and leadership skills, as well as focused exploration of different employment sources. Other training provided in the local communities in partnership with local training institutions and government agencies have been: budgeting and financial planning, computer skills, automotive mechanics, and electrical and plumbing certification. Community members and employees have also developed new skills and knowledge as they learn about environmental conservation, conflict resolution through mediation, and human rights training.

The Community Entrepreneurial Development Program, in partnership with Sustainable Economic Futures (SEF) Canada, has been in place for the last two years. The Enterprise Development (ED) program aims to assist in the development and support of small businesses within local communities around Cerro San Pedro. This grassroots program, which is currently funded by New Gold, relies on a facilitator and a group of volunteers from within the communities. More than 150 local people have joined as volunteers or clients to date.

1.

This refers to all areas where reclamation activities have been initiated and not yet completed, and includes a wide range of activities such as seeding, replanting, filling or capping mine shafts, and removal of contaminated material.