Denver —
The company, through its subsidiary, CR Kendall, will remit its US$1.9-million environmental bond in order to complete reclamation. The DEQ also withdrew its November 2000 order declaring Canyon’s bond in default and forfeit.
The snag in the reclamation process came in 1999, when the state recalculated the environmental bond in light of new water treatment the DEQ said was needed after water samples from the toes of several waste piles showed nitrate and thallium concentrations that exceeded water quality standards. It wanted Canyon to construct and maintain a reverse osmosis treatment plant at Kendall to process the estimated 20 million gallons of contaminated water per year in perpetuity.
The bond jumped to US$8 million, up from US$1.9 million when the open-pit heap-leach operation started, in 1988. Later in 2000, the bond was increased to US$13 million, and finally to US$14 million.
Mining at Kendall stopped in 1995, with residual leaching continuing for another few years. In all, the mine produced 302,000 oz. gold and 136,000 oz. silver. By the time Kendall was closed, Canyon had already spent US$7 million on reclamation and didn’t believe the stiffer bond was appropriate.
The company complied with the DEQ’s request to capture and treat the water, but still sought other alternatives to the expensive, long-term treatment plan. More recently, Canyon proposed using the water to irrigate some of the disturbed land at Kendall, and it has since received requests for local ranchers to use the water to irrigate range-land downstream from the operation. The DEQ is expected to reach a final decision soon.
No baseline work for thallium was conducted before operations began, though Canyon did fund a third-party study of the region’s water quality in 1998. The results showed that traces of thallium (less than 1 part per million) exist in surface waters throughout most of the North Moccasin range of central Montana, at levels greater than existing standards allow.
To date, reclamation is about three-quarters complete, with two of the six small open pits fully backfilled. Waste dumps have been recontoured and revegetated with native grasses, and more than 200,000 trees and shrubs have been planted across the site. In 1997, CR Kendall received an award from the U.S. Bureau of Land Management for having reintroduced the peregrine falcon to the region.
Meanwhile, at the Briggs gold mine in southeastern California, Canyon has a US$3-million reclamation bond, plus an extra US$1-million bond to cover unpredictable events such as earthquakes (50 ft. beyond the toe of the leach pad is a 20-ft.-high escarpment in an alluvial fan).
“Environmental bonding is very site-specific and rock specific,” says Richard De Voto, Canyon’s president. “No two are the same.” Indeed, Briggs differs from Kendall in several respects. Since it is situated in the desert, near Death Valley, surface water is not a problem. At present, Canyon is pumping saline water from the alluvial fan for the operation at Briggs. Also, the rock at Briggs does not generate acid, and mineralization is hosted in quartzite, and locally in dolomite, with only minor pyrite.
Environmental bonding has been an important issue since the former Clinton administration imposed new rules governing hardrock mining on public lands. The so-called 3809 regulations went into effect the day before George W. Bush was inaugurated as president.
The Bush administration proposes suspending the new 3809 rules, and has given interested parties until May 7 to voice their opinions.
Canyon’s other major asset is the multi-million-ounce McDonald project in Montana. A state district judge has named Oct. 11 as the trial date for the company’s challenge to the I-137 ballot initiative, which outlawed the use of cyanide for open-pit gold mines.
The company is seeking to overturn I-137 or, failing that, seek a damage award for its lost opportunity caused by the ballot initiative. The award could be as much as US$500 million, says Canyon.
Be the first to comment on "Canyon reaches reclamation agreement"