Yukon might assume Victoria Gold accident cleanup

The Yukon government is considering taking over the cleanup at Victoria Gold’s (TSXV: VGCX) Eagle mine as the company struggles with the scale of remediation work.

Lauren Haney, deputy minister for Yukon’s Department of Energy, Mines and Resources (EMR), made the comment in a news briefing on Thursday. While cyanide levels in area surface water are declining, officials said Victoria must increase holding ponds and boost its treatment of cyanide-contaminated water from the landslide.

“(Victoria is) diverting water, collecting it, doing a lot of work right now to try to treat it. That’s not to say it’s enough, but it’s to say there is action being undertaken,” Haney said. “We’re looking at all the scenarios right now, and one of those scenarios is where we would be taking over activities at the site in a more complete way.”

Her comments came almost one month after the company suspended operations at Eagle following the heap leach spill and landslide that unleashed 4 million tonnes of material, with half leaving the pad’s containment. Between 280,000 and 300,000 cubic metres of cyanide-containing solution left the containment, according to government estimates. Victoria’s share price plummeted more than 85% during the last week of June. The single-asset company now has a market cap of $45.3 million. 

Victoria has issued three news releases since the accident. It has not responded to multiple requests for comment. Haney called Victoria’s sparse communication about the accident and its cleanup actions “unfortunate and unhelpful.” The precise cause of the accident is being investigated.

‘Can’t handle treatment’

Officials have ordered Victoria to increase its contaminated water storage capacity to 150,000 cubic metres by July 29 because its existing ponds are almost full.

“As a temporary measure, the company is creating additional storage space by pumping water from the storage ponds through the heap,” which it will do for 10 to 15 days, Kelly Constable, director of mineral resources with the EMR department said during the briefing. That’s meant to hold the water until it can be treated and released into the environment.

But Constable added that Victoria’s water plant can’t treat all the contaminants in the water, and it’s trying to upgrade the facility with the help of Lincoln Engineering. Those upgrades could take a few weeks.

“They have a a water treatment plant that is designed to treat to their effluent quality standards in their water licence,” Haney said. “It wasn’t contemplated that the contamination levels would be as high as they are.”

‘Lack of transparency’

While those solutions might suffice temporarily, they’re actually the lesser of evils, said Adrienne Hill, from the First Nation of Na-cho Nyak Dun’s (FNNND) Treaty Implementation Department.

“Re-circulating contaminated water back onto the pad as an emergency measure because there’s nowhere to put it, is not ideal,” Hill said in an interview after the briefing. “We don’t think the Yukon government is being transparent about how dire the situation is.”

As part of the water treatment effort, the company moved essential on-site staff to temporary overnight camps near the mine, which The Northern Miner learned about earlier this week from a leaked document.

“The existing camp is located within the path of the (land)slide area,” Haney said, adding that Victoria decided on its own to move the workers with no orders from the government.

Victoria has met government deadlines to prepare development plans on remediation, including for water flow, slope stability and water treatment, government spokesperson John Thompson said.

Lower cyanide risk

Results from testing on July 4 showed a cyanide level of 0.04 mg per litre, which is above the aquatic life guideline of 0.005 mg per litre, but less than previous tests, Tyler Williams, a water resources scientist from the Department of Environment, said during the briefing.

Further surface water testing on July 8 and 10 returned results below those guidelines.

Testing of groundwater samples in the area on July 5 and 10 revealed a detectable level of thiocyanate, a stable and less toxic form of cyanide that doesn’t have an aquatic life guideline, Williams said.

Though the government still must send its water samples to a laboratory in British Columbia for testing, it has asked the turnaround time to be shortened to five to seven days.

‘High concerns about water’

But while the thiocyanate found in the groundwater tests might not be as toxic as cyanide, that result offers little re-assurance to the FNNND, Chief Dawna Hope said.

“We have high concerns that (cyanide is) sitting in the ground water,” she told The Northern Miner. “We’re not sure where those numbers are coming from in regards to the groundwater. We’re not sure how deep the wells are.”

First Nation teams  tested surface water after the June 24 accident and sought evidence of damage to plants and wildlife. Hope said one dead fish has been found.

It also conducted lidar testing using drones to monitor ground water, and its technical team is reviewing 17,000 images, Hill said.

‘Pause on mining’

Hope clarified that even though the First Nation called for a moratorium on mining activities on its traditional territory after the Eagle accident, it’s not against mining. Rather, it wants a temporary pause while the cumulative effects of the accident can be assessed, and afterwards sustainable mining activities should be pursued.

Several contracting companies associated with the FNNND worked at Eagle, and the suspension of operations there has forced them to seek work elsewhere. Hill said the economic loss from the end of royalty payments after the accident is “significant.”