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News Release

Mining Companies Try to Duck Liabilities at Old Uranium Mines

Recent months have seen mining companies trying to get out of their obligations at the closed-out uranium mines in Cluff Lake, Saskatchewan and Elliot Lake, Ontario.

In January, Denison Mines Limited brought an application to the Canadian Nuclear Safety Commission (CNSC) to change its licences for the former Denison and Stanrock mines in Elliot Lake. It seems that Denison, which was on the verge of bankruptcy when the Elliot Lake mines closed, now needs to protect itself from having to pay any money back to clean up and maintain the sites.

The City of Elliot Lake objected, but since there is an agreement in place between the Ontario and Federal governments to look after the sites, the CNSC considers the liabilities adequately covered. The City also objected to the CNSC hearings taking place according to Denison's timetable, and that the City had inadequate time (only a few days) and inadequate information to respond to the proposal. The City actually wanted to be able to review the company's proposal and all the related financial information, including the shareholder's prospectus, which had not even been published.The CNSC, of course, rejected any notion that it was "unduly influenced by the applicant's business timetable."

Most interesting in this proceeding was the impatient and arrogant attitude of Denison's President and CEO, Peter Farmer, towards the City of Elliot Lake and even the CNSC Commissioners. He was dismissive and contemptuous of any suggestion that the company might have some residual obligation towards the community, having taken billions of dollars out of it over the years. The most important thing from the company's perspective seemed to be to clearly separate any liability at Elliot Lake from its other operations now that the company is once again making a profit and trying to attract investors and partners.

In February Rio Algom applied to the CNSC to have the licences for the former Quirke, Panel and Stanleigh mine sites amalgamated in order to simplify the paperwork. However, the sites have separate performance bonds which will have to be maintained in case of problems - except for the Stanleigh mine, where a contractual arrangement between Rio Algom and Ontario Hydro obligates Ontario Hydro to pay all decommissioning and "care and maintenance" costs for the site.

Interestingly, while CNSC President Linda Keen questioned how Ontario Hydro, which no longer exists, could pay for anything, it seems that the agreement is the responsibility of Natural Resources Canada, who have reviewed it and raised no objections. Again, under the Canada-Ontario cost-sharing agreement, the CNSC considers the liabilities adequately covered.

There are about 170 million tons of radioactive, acid-generating tailings in the Elliot Lake area that will have to be monitored (and in some cases, treated) for several millennia.

Meanwhile, Cogema is planning to decommission the Cluff Lake mine in northern Saskatchewan. This is the first high grade mine to be fully decommissioned. A Comprehensive Study has been initiated under the Canadian Environmental Assessment Act (CEAA), and the Comprehensive Study Report was published in December 2003 for public comment by February 27. MiningWatch Canada submitted comments, and did several other groups. Unfortunately, the report doesn't provide any actual data or justification for its conclusions and recommendations. In fact, the documentation is not even listed. At the same time, the participation and input of the general public and affected First Nations and non-aboriginal communities is not documented. The mine site may well need to be monitored for thousands of years, and it is the neighbouring communities and their descendants who will be left with the ultimate responsibility.

It is up to the federal Minister of Environment, David Anderson, whether to accept the Comprehensive Study Report, send it back, or send it to a panel review. If he accepts the report, the CNSC will proceed with licencing the decommissioning with hearings in April in Ottawa and June in La Ronge, Saskatchewan. Our submission is available here.