17* International Mining Congress and Exhibition of Turkey-IMCET 2001, ©2001, ISBN 975-395-417-4 Linking Long-Term Environmental Liability and Closure: A Necessary Development Towards Walk-Away Closure E.C.Packee Jr. Travis/Peterson Environmental Consulting, Inc., Fairbanks, Alaska, U.S.A S .Bandopadhyay University of Alaska Fairbanks ABSTRACT: Long-term liability is a risk that must be considered prior to permanent mine closure. Current definitions of closure do not link liability release with the attainment of environmental performance standards. Indeed, contaminated sites laws of major mineral producing nations hold me mine owner, and long-term corporate profitability, accountable not only for current environmental regulations but for future regulations as well. This is known as absolute and retroactive liability. This paper uses the South African situation to address the impact that absolute and retroactive liability has on the long-term profitability of the raining industry and then uses internationally published definitions of mine closure to demonstrate the desirability of linking 'closure' with liability release. Once liability and closure have been linked, all that prevent 'walk-away' closure is the determination of the financial implications of future environmental degradation at the site. 1 INTRODUCTION Internationally, published definitions of mine closure generally indicate that closure occurs following the cessation of extractive operations at the site. South African, Canadian, and Australian mines reach closure following decommissioning and final rehabilitation, while closure initiates decommissioning and final rehabilitation at mines in the United States of America. Current definitions do not address the long-term liability for the site following closure. Linking closure to liability release means that mine closure occurs when the state accepts responsibility for the decommissioned site. In the case of South Africa, site liability varies between the three principal acts governing mine environmental management and is currently preventing closure from occurring. Closure is a necessary step in the management of South African mines because mine assets cannot be sold until a Certificate of Closure has be issued by the Department of Mineral and Energy Affairs. The current confusion surrounding closure threatens the economic survival of mining corporations in South Africa and must be resolved. Industry should take the initiative by assuming that mine owner's have absolute and retroactive liability for the impacts of mining. Although this represents 'worst case liability', it insulates the mine owner and operation from changing environmental performance standards. The Australian concept of 'safe and stable' mines provides site specific and quantifiable means for determining the impacts of mining following closure. 2 THE DEFINITION OF MINE CLOSURE Traditionally, the environmental management of collieries ceased following permanent closure. The long-term liability imposed by the 'polluter-pays- principle' fundamentally alters the 'operating environment' of coal corporations. This 'new' reality forces are-examination of conventional definitions of'closure* and 'impact' and the mining lifecycle. 2.1 Current international definitions of mine closure The operating environment of coal corporations is a dynamic system. Individual operations are sensitive to changes in corporate priorities, commodity prices, and extraction costs. Mining is venture capitalism, albeit on a grand scale. Traditionally, closure represented the final stage of the mining life cycle. Corporate involvement and site responsibility ceased following closure and the property lapsed into abandonment. Indeed, this view pervades the mining industry. Consider the following definitions: United States of America (Hardrock) "Closure - Closure involves the removal of structures/buildings, and other infrastructure, and 181