Closure and Reclamation

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Approach

Closure and reclamation of a mining property is a complex process. Done poorly, a closed mine can leave behind safety and environmental issues, economic and social community challenges, and ongoing costs and liabilities. Abandoned or improperly closed mines are one of the most damaging factors to our industry’s reputation. On the other hand, proper mine closure can significantly minimize risks and liabilities, reduce the need to manage the property in perpetuity, and successfully transition the land from a mine site to a stable land resource that will provide sustainable community benefits for generations to come.

Our commitment to provide for long-term environmental stability and beneficial post-mining land uses is stated in our Sustainability and Stakeholder Engagement Policy, and our approach to fulfilling this commitment is detailed in our Closure and Reclamation Management Standard.

Newmont’s closure and reclamation strategy builds on industry leading practice and takes a technically and financially sound approach to anticipating, understanding and managing our closure obligations. We continue to adjust our strategy to improve the accuracy and transparency of our closure and reclamation efforts and align them with our mine and business planning processes.

Prior to construction, each Newmont operation must have a closure and reclamation plan that:

  • Identifies the technical aspects of closure and associated costs;
  • Considers and addresses regulatory, community and stakeholder commitments and expectations identified during stakeholder engagements and social impact assessments;
  • Identifies and addresses the risks and impacts of mine closure on the stakeholders and community;
  • Establishes design and success criteria that minimize environmental, social and financial risks;
  • Includes a concurrent reclamation plan integrated into annual and long-term mine plans; and
  • Integrates closure and reclamation requirements into the annual mine planning process.

Our closure governance model ensures a balanced, multidisciplinary approach to closure planning as well as senior executive involvement and oversight of closure plans and costs. The model consists of a steering committee composed of senior leaders and a multidisciplinary Closure and Reclamation Technical Team (CRTT) that is responsible for the development and monitoring of the plans and for preparing closure cost estimates annually throughout the mine’s life.

To minimize the social and economic impact of mine closure, our standard requires sites to engage and involve stakeholders in planning, implementing and monitoring the closure and reclamation process. Currently, all of our operations engage local stakeholders whenever a significant event – such as a permit change, mine expansion or environmental impact assessment – warrants a review of the mine closure plan.

Concurrent reclamation – the act of rehabilitating land that is no longer required for operations while we are still mining – is effective in achieving successful and sustainable post-closure outcomes. It helps minimize acid rock drainage and other environmental impacts; allows time to test options; takes advantage of the equipment and personnel already on site; and reduces the time required post-closure to achieve a successful outcome. We plan and budget for concurrent reclamation before operations begin and evaluate opportunities during the annual business planning process.

Another important aspect of our commitment is the ongoing management of 15 legacy sites. Some of these are closed mine sites we acquired as a result of a larger acquisition, and some are sites we once operated but have since ceased mining operations. We are committed to safely and responsibly managing, decommissioning and rehabilitating these sites so they pose no threat to the environment or people and, when possible, repurposing the land for other uses or restoring it to its pre-mining use.

Beginning in 2016, we integrated our concurrent reclamation targets into our annual incentive compensation plan (AICP). Each region establishes a target for the number of hectares to reclaim on an annual basis. Bonus payouts are adjusted downward or upward depending on our performance in achieving the targets. This performance incentive program is considered to be industry best practice.

2016 Performance

In December, we publicly disclosed an update on our reclamation plan for the Yanacocha operation in Peru as part of the requirement to submit an updated closure plan to Peruvian regulators every five years. Based on updates to the plan, and in connection with our annual evaluation of all asset retirement obligations, we significantly increased our estimated future closure costs for Yanacocha. Additional detail on our review of Yanacocha’s closure plan and the financial impacts are included in our 2016 10-K report (see Note 6 and Note 7).

Reclamation activities during the year include:

  • Globally, we completed concurrent reclamation on more hectares than planned for reclamation during 2016, exceeding our initial target area by 131 percent.
  • All sites, with the exception of Boddington in Australia, met the target of completing at least 80 percent of their planned concurrent closure and reclamation activities for 2016. Boddington, which was impacted by delays in contractor mobilization as well as heavy rains that resulted in design changes, implemented plans to complete its 2016 objectives and achieve the targets set for 2017.
  • An additional 590 hectares globally were disturbed by our operations, and a total of 4,204 hectares are in various stages of reclamation, bringing the total cumulative disturbed ground not yet reclaimed to 32,428 hectares.

All sites had closure and reclamation plans in place. While we continually explore opportunities to extend the mine life at all our operations, at the end of 2016 three sites – Yanacocha in Peru and Lone Tree and Emigrant in Nevada – were within five years of their expected closure date based on current metal prices and our business plan.

In addition to accruing funds for reclamation costs relating to currently or recently producing mineral properties, we also have environmental obligations associated with former mining activities and sites that require developing and implementing remediation plans. For more details of Newmont’s closure and reclamation costs, please see our 2016 10-K report, pages 9, 76 and 126.

Other significant closure and reclamation activities during the year included:

  • Among our legacy sites, a key development was initiating the first remediation phase at the Midnite mine – a former uranium mine located in the state of Washington. This phase included contractor mobilization, development of site construction and support facilities, and implementation of the formal community engagement approach in collaboration with the Spokane Tribe of Indians. We also continued closure of the Dawn Mill site, which has been underway since 2013, completed surface reclamation and entered a post-closure monitoring period.
  • We finalized and implemented an updated Closure and Reclamation Management Standard that incorporates more robust guidance on managing the socio-economic impacts of mine closure on host communities. We developed a “Social Dimensions of Closure and Reclamation” guidance document to support implementation of the standard.
  • We held a workshop on closure risks that representatives from all regions attended. Key takeaways and recommendations from the sessions include the need to integrate social aspects earlier in the mine planning process; clearly communicate the risk, cost and liability reduction benefits of concurrent reclamation; and enhance guidance and emphasis on the planning and management of pits, pit lakes and in-perpetuity water treatment.
  • During the year, our Yanacocha operation held more than 80 workshops with more than 2,000 stakeholders in the Cajamarca region to discuss the operation’s potential closure and expansion plans.
  • Our Akyem operation in Ghana invited community members to observe our concurrent reclamation efforts taking place on site, which is located on 101 hectares of the Ajenua Forest Reserve. In 2016, we signed a memorandum of understanding (MoU) with the Ghana Forestry Commission to initiate the second phase of a reforestation program, which, when combined with the first reforestation program that began in 2014, covers around 300 hectares.
  • Newmont received the Excellence in Hard Rock Reclamation award from the Colorado Department of Natural Resources for work to reclaim the former Black Cloud mine in Leadville, Colorado.
  • For work performed over a 10-year period at the Bootstrap/Tara/Capstone waste rock disposal facility near our Carlin operation in Nevada, we received two Nevada Excellence in Mine Reclamation awards – Overall Mine Reclamation and Wildlife Habitat Enhancement. An interagency panel of state and federal agencies selected the project for the prestigious awards.
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Future Focus

Our 2017 closure and reclamation target focuses on increasing the annual area reclaimed concurrently with operations. Concurrent reclamation reduces the size of our impact and minimizes the infiltration of water through mine rock and disturbed soils.

Closure and reclamation target
Year Target definition Target for sites Target for Newmont
2017

Percent of concurrent final reclamation activities executed against the site plan

90 percent of Concurrent Final Reclamation Plan achieved

90 percent of planned reclamation activities achieved across Newmont

Areas of focus in 2017 to achieve our target and improve our closure and reclamation performance include:

  • We will continue to evaluate opportunities to extend the mine life of Yanacocha, which is South America’s largest gold mine. The current projection for its last year of mining is 2026, and Yanacocha anticipates significant stakeholder engagement and reclamation activities over the next 10 years. In 2017, we will continue to gather feedback on our closure plan via workshops and focus groups with local governments and community members.
  • To improve our closure planning and implementation throughout the organization, we will hold another global workshop in 2017 for sites and regions to share lessons learned on identifying closure risks and mitigation approaches. Findings from the workshop on aspects of closure that warrant focus will be communicated to the Closure and Reclamation Technical Team (CRTT) and the steering committee.
  • Phase one remediation at the Midnite mine in Washington state will continue with the primary focus on the dewatering, sediment removal and backfill of one of the two remaining open pits.