Mining for Closure: Policies, practises and guidelines for sustainable mining and closure of mines

be disadvantaged in their endeavours when com- pared to those potential miners accessing alter- native capital markets with more limited require- ments relating to closure funding. The development of corporate governance, regula- tory frameworks, financial and insurance markets to address the funding of mine closure is further complicated by involvement of some “junior inves- tors”, who unlike many major mining companies, have only limited resources to back up the mining company’s obligations, and have significantly less- er sensitivity to other factors driving responsible behaviour such as reputational risks. Such actors are more prevalent in EiTs than in more developed mining nations. Despite the relevance of these issues and the press- ing nature of the challenges, the nature of discus- sions surrounding the advancement of mining in the region is presently somewhat compromised. As such, it is expected that a key outcome of this docu- ment should be a more open and informed debate surrounding the need for mining and the ability of mining to serve as a valuable economic driver for development while still maintaining or even im- proving the environment.

cial, environmental and social liabilities associated with such sites also pose a barrier to development in such jurisdictions. In contrast to countries that have already implemented ‘good international min- ing practices’, and despite significant progress since that time, these EiTs have yet to develop sufficiently sophisticated corporate governance, regulatory frameworks, or financial and insurance markets to adequately address mine closure rules or funding. Among other things, Nazari (1999) indicates that this leads to: delays in developing projects and investments in this sector, potentially inequitable distribution and exter- nalization of closure costs, costly and time consuming tailor-made solu- tions on a case-by-case basis, and differentiating, and possibly creating the im- pression of ‘penalising’ investors seeking fi- nancing or political risk insurance through International Financial Institutions. Addressing the last point, it should be noted that international financial institutions typically require consideration of closure related issues. As a result, investors seeking finance from such sources may 1. 2. 3. 4.

Bor smelter – Serbia Photograph by EnvSec

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MINING FOR CLOSURE