Jack Caldwell, ( who I respect and admire very much not just for his expertise on TSF’s but for his fidelity to advocating for best knowledge, best management in their design, construction, management and closure..for donkeys years.) posted this morning from his blog ( I Think Mining.Com) that Steven G. Vick publicly acknowledged at a Tailings Conference yesterday that 100% of all TSF’s will fail. If Vick is right ( and I would never dispute anything about TSF’s with Vick or Jack) then a very rough first cut calculation is that the total unfunded and perhaps unfundable public liability just from TSF’s alone is $(us)1.05 trillion. That is $(us)150 per person for every person alive on earth today ( see my post at I think Mining for details..I will post here as footnote later today) I didn’t hear the actual full context myself and I am sure he was in part simply saying “no man made structure can last forever” but having read many of his papers and many of the dam committee reports on failed TSF’s that he investigated, in particular OMAi (Guyana 1994) I think he means more than that. He has seen the deep flaws in permitted TSF’s not just in reviewing failed ones but in his other work as well as perhaps one of the top three experts in the world on TSF’s. He knows what skeletons are in the closet and I have seen that too in my deep dive into what has shaped that global inventory of currently operating TSF’s.
In my business (..Risk Assessment, Risk Management, Risk Finance), an event that is certain is not within the definition of a “risk”. If the probability of failure of a TSF is 100% as Vick is reported to have said (probability of failure=1) ( ie it is not a question of whether but when) then we are not talking about “risk” we are talking about 100’s of standing TSF’s globally every single one of which could eventually fail, not because human structures can’t last 100’s of years but because most were built without regard to known and widely accepted best practices. He knows that. That is what he is most likely pointing to.. That formula from “my industry”used by Vick & Robertson is not proper if in fact there is 100% certainty that all TSF’s will fail eventually. In my world of expertise that formula is used to evaluate the consequence of random events not the consequence of a certain event where accepted practice is to build structures that will fail.
In fact , by coincidence, the paper we will soon release arrives at exactly what Vick has said and I have been working the past two days on the best numbers to describe both the geographic scale and economic consequence of that reality.Ie the total unfunded and presently unfundable economic public and environmental consequence of the entire TSF profile globally. ( By the way every chapter in this work in progess is headed by a quote from a mining industry leaders..just this second I have switched out the lead to that chapter for Vick’s authoritative quote.(.thank you Jack) frames our point so beautifully and sets up the numbers that will follow that quote in our paper.)
I am sure Vick’s point is the same as my conclusion..that therefore we have to focus on reducing consequence to the fullest extent possible..I have been writing to Jack and others for weeks now that the policy goal has to be to move TSF’s from their historic and unsustainable loss rate down to something closer to the failure rate for water dams. In other words we have to take chronic chosen deviation from best knowledge and best practice out of the process.
The level of chosen deviation from known best practice, best science , best knowledge is not a tolerable reality for something with such massive economic consequence geographically, environmentally. It’s not acceptable that Imperials LLC and the structure of Canadian and Provincial law will effectively completely insulate Imperial from the consequence of this loss as happened with Omai( Guyana 1994) and with Bolden at Los Frailles. The creation of shells which shield a company against consequence is not an acceptable condition of the social license to operate especially where the public demand is “polluter pays”.
Business as usual is not an option. That is really what Dr. Vick is saying.
We set out just to map why it is the polluter never pays for the massive public and environmental consequences of a TSF failure, to show that it is always tax payer pays or just accept the loss. When we laid out everything it took to explain the entire context of that we almost immediately saw in the numbers what Vick has now publicly pronounced. ( we are assuming Jack has correctly reported Vicks remarks, of course because we trust and respect him)
I previously outlined in Jacks post mocking me what the strategy has to be to lower consequence. to conditions that will continue the “social license to operate” Let me preface my list by saying I have been a policy wonk for 43 years and have all my life fought against, denounced and tried to fix or eradicate command and control approaches to law and regulation. Law & regulation have to be workable and doable and understand the actual operations and constraints on an industry. It has to “map into” the actual flow of an industry. I believe the West Autralian structure, just accomplished, actually does that. It can be done. It just hasn’t been tried yet in the U.S, and Canada.
I have written extensively about flaws in U.S laws like Superfund, Lead In Construction , Asbestos Statutes &Regs etc.c. for Lloyds Environmental Risk Management, Managing Risk For Loss Control & Prevention, the CPCU Journal, Business Insurance and the Risk Management Journal. (A lovely professional photo of me & my bunny rabbit,”Bugs” actually were the full top page cover of business insurance once) So when I speak of controls via regulation I am not talking about the usual, I am talking about something more like what West Australia has done, something that can actually work, something that doesn’t add ridiculous levels of costs with out any justifiable corresponding public benefit.
(1) it is too late for incremental fixes permit by permit new TSF by new TSF.The “infestation” is too severe from too many years of building a TSF inventory that rejects best practices ( not as our paper will show out of will but out of cash flow pressures and economic realities of developing and operating a mine) Companies do what they do to survive or perish or Sam Jones put it .
(2) New entry has to be more tightly controlled not just on strict adherence to best pactices but also on the financial capacity of the operator and existence of a responsibly managed risk finance plan for all public and environmental liabilities.
(3) new entry new permits) have to be conditioned on each applicant accounting for and having an aggressive program for looking at all its standing TSF’s ( not just in the political jurisdiction issuing the permit..ALL of them and making fixes or building new TSF’s as necessary to address those at highest risk of major consequence.
As is clear in our paper when its all laid out this is a co-ventured reality of too many standing currently permitted and operating TSF’s. It is the product of a longstanding partnership and mutual consent between government and the industry. We the people were looking in the wrong places or advocating for the wrong things as all this shaped the profile of the thousands of standing TSF’s globally.
The final reality ad toughest sell where the public expects “polluter pays” is a tough sell. The consequence of loss and the costs to fix it has to be shared. Government just can’t turn back to the industry and say fix this by 2020. Every tax payer in every jurisdiction that issues permits for mines and has standing mines will have to also be part of this investment. Thank You Jack. Thank you Steven G. Vick Now Lets’ get to work working on a workable strategy together for tackling that unacceptably high consequence of unfunded public and environmental loss.
The Dam Review Committee report on Mt. Polley isn’t on the critical path to that.
We know that already.