Placer Dome advances clean-up

In the Philippines, a work crew is persevering in its attempt to seal a breached tailings impoundment that dumped 4 million tonnes of mine waste into a nearby river in March, Placer Dome (PDL-T) reports.

The tailings began leaking from a mined-out pit that was being used as an impoundment. The spill, which was caused by the failure of a concrete plug, stopped on its own just days later.

The Vancouver-based company holds a 40% interest in Marcopper Mining of the Philippines, which operates the copper mine, situated on Marinduque Island.

“We think we have a good plan now,” says Hugh Leggatt, a Placer Dome spokesman. “It’s a massive project — very complex and very challenging. We think we’ve acted correctly in taking 100% of the responsibility, even though we own only 40% of the company.”

To install a permanent plug, a second tunnel is being advanced past the area of rock failure in the drainage tunnel. In addition, a 1,000-metre-long channel has been dredged at the river’s mouth in order to capture tailings that have moved downstream and keep them away from the ocean.

Three Marcopper officials, two of whom were Placer Dome employees on secondment, have been charged in connection with the spill. At a court hearing in early September, a Filipino judge agreed to hear a motion, filed by former president John Loney, former mine manager Steven Reid and current manager Peter Hernandez, to dismiss the charges. A decision is pending.

The Philippine government has also lifted orders barring Loney and Reid from leaving the country, pending court appearances. Loney remains Placer Dome’s senior manager there, while Reid works out of the company’s Vancouver office.

As a result of the spill, Placer Dome took a US$40-million charge against earnings in the second quarter, including US$15 million for repairs and environmental mitigation. Leggatt says the expenditure will cover all costs related to clean-up.

Independent studies suggest the tailings pose no health risks to communities in the vicinity of the spill, though fish and other aquatic life were smothered by the silt.

Placer Dome has been negotiating with Provident Tree Farm, Marcopper’s major shareholder, to give the Philippine resource company a chance to reopen the mine, which was permanently closed by the government following the spill. The deal includes Placer’s acquisition of Marcopper’s US$21-million loan from the Asian Development Bank. Placer Dome must also return its 40% interest in Marcopper back to the company. The cost of those obligations is included in the company’s second-quarter charge.

John Willson, Placer Dome’s president and chief executive officer, met with Philippine President Fidel Ramos in mid-September, after which Ramos reportedly expressed satisfaction with the company’s clean-up efforts. He also is said to have invited Placer Dome to continue its involvement in the country’s mining industry.