Ana Elizabeth Bastida

Presentation to Session 2: Mine Closure Planning as a Prerequisite for

Mining Investment
Inter-Governmental Forum, Annual General Meeting 2015
Post-Mining Transition and Environmental Management
27 October 2015
Room XXV, Palais des Nations, Geneva, Switzerland
Outline

 A review of main features of the mine closure regime in Chile

(entry into force in 2012);

 A perspective on challenges faced in practice by ongoing

operations, and the debate around the application of the
regime to small and medium mines.
The Mine Closure Regime in Chile (2012)

 1980 Political Constitution of Chile enshrined in narrow terms the ‘right to live in an
environment free of pollution’. Broadened with the enactment of the Framework
Environmental Law 19,300 in 1994. Submission of mining projects to an Environmental
Impact Assessment System compulsory from 1997.

 Provisions about mine closure were specifically found in the Mine Safety Regulation
(Decree No. 72/85, Title X, as amended by Decree Nº 132/04).

 Law 20,551 Regulating Mines and Installations Closure (“Mine Closure Law”)
published on 11 November 2011 and entered into force on 11 November 2012.
Regulatory Decree Nbr 41 entered into force on 22 November 2012.

 The competent authority (the National Geological Survey (‘SERNAGEOMIN’) has

elaborated ‘Methodological Guides for the Submission of Mine Closure Plans’ which
contain minimum standards.
The ‘Mine Closure Plan’: Core Concepts

 The Law requires a mine closure plan to be approved by SERNAGEOMIN

prior to starting mining operations.

 Focus on ensuring physical and chemical stability of the site with a view to
provide safeguards to the life, health and safety of people and the
environment.

 Mandatory progressive closure. Closure must be planned and

implemented progressively over the different operational stages of mining
projects. The plan must be implemented by the mining company before the
end of operations so that all measures under the plan are finalised and the
conditions for physical and chemical stability created.
The ‘Mine Closure Plan’: Reviews
 Mine Closure Plans are subject to audits every five years during the
operations in accordance with monitoring plan prepared by SERNAGEOMIN;

 Submission of a final audit report upon implementation of all actions to prove

compliance with the closure plan for the granting of a certificate evidencing
mine closure. There are two types of certificates: for partial and for final
closure;

 The granting of certificates will entitle the mining company to request a

proportional relinquishment of funds. Non-compliance with the closure plan
entails execution of the financial guarantee, and penalties that range from
fines to suspension of operations.

 The law also provides for the establishment of a ‘post-closure’ fund to be

transferred by the relevant company to the State to cover post-closure costs.
Two Types of Procedures

Two types of procedures for the approval of mine closure plans based on the
amount of production.

 The ‘general procedure’ applies to mining companies developing or

processing minerals from one or more orebodies and which capacity for
minerals extraction exceeds 10,000 tons per month per operation (subject
to the establishment of a financial guarantee and mandatory audits);

 The ‘simplified’ procedure applies to companies which capacity for

extracting or processing minerals equals or is lower than 10,000 tons per
month, as well as mining explorations under EIA and prospecting
(exempted from financial guarantees).
Mine Closure in Chile in Practice: Transition
Provisions

 Ongoing operations at the time of entry in force of law with plans approved
under Mine Safety Regulations: Must establish financial guarantees two years
from entry into force (due November 2014);

 Many practical questions related to the amounts to estimate costs and the
scope of closure (eg inclusion of costs for the dismantlement of port facilities);

 Close support by SERNAGEOMIN for the preparation of estimate of

guarantees through series of technical assistance workshops;

 134 operations (amounting to 90% of all in the country) complied with

establishment of guarantees.
Mine Closure in Chile in Practice: Reserves
v Resources

 The estimate of the life-cycle of the mine was on the basis of

reserves as certified by a competent person in mining resources
and reserves pursuant to the Code of Prospects, Mining
Resources and Reserves (Law 20,235);

 Small and medium companies requested change in the formulae

to calculate the life cycle of the mine on the basis of ‘resources’
instead of ‘reserves’

 Law 20,819 published on 14 March 2015 amends the basis of

calculation of life cycle based on ‘resources’.
Mine Closure in Chile in Practice

 Institutional support: Technical workshops by SERNAGEOMIN

on the implementation of the Mine Closure Law and
establishment of guarantees;

 Interface between EIA and sectoral mine closure plans;

 Community information duties very broad and general;

 Civil society concerns on climate change and on establishing

regime for mining liabilities (www.relaves.org )
References: The Mine Closure Regime

 1980 Political Constitution of the Republic of Chile

 Organic Constitutional Law of Mining Concessions No. 18,097, Official Gazette 21 January 1982 and
Mining Code, Law No. 18,248, Official Gazette 14 October 1983
 Environmental Framework Law No. 19,300, Official Gazette 9 March 1994 and Decree No. 40 Regulation
of the Environmental Impact Assessment System, published on 12 August 20132012
 Law No 20,551 Regulating Closure of Mines and Mining Installations, in force from 11 November 2012
and Decree 21 approving Regulation, 22 November 2012.
 Decree Nº 132/04: Title X, on Mine Safety Closure (regulation prior Law 20,551).
(all available from http://www.leychile.cl/ )

Guides to assist in the preparation of mine closure elaborated by the National Geological and Mining Survey:
 ‘Methodological Guides for the Submission of Mine Closure Plans’ (approved by Resolution Nbr 0598,
28 March 2014, of SERNAGEOMIN.
 ‘Methodological Guides with Technical Criteria’, including the Methodological Guide for Risk Assessment
for Mine Closure (approved by Resolution Nbr 0599, 28 March 2014, SERNAGEOMIN), and the
Methodological Guide for the Constitution of Financial Guarantees.
References

 Campos, Jorge; Lopez, Ricardo; Weeks, Björn; López, Andrés, “National guide for the
estimation of closure costs: The Chilean experience”, Proceedings of Mine Closure
Solutions, 2014 April 26−30, 2014, Ouro Preto, Minas Gerais, Brazil Published by
InfoMine, 2014 InfoMine, available at http://www.mineclosuresolutions.com/wp-
content/uploads/2014/05/Campos-Jorge-National-guide-for-the-estimation-of-closure-
costs-The-Chilean-experience.pdf

 Olivari, Alfonso, “Financial assurance for mine closure in Chile”, Proceedings of Mine
Closure Solutions, 2014 April 26−30, 2014, Ouro Preto, Minas Gerais, Brazil,
Published by InfoMine, 2014

 SERNAGEOMIN website – ‘Cierre de Faenas Mineras’,

http://www.sernageomin.cl/ambiental-cierre.php