MAC: Mines and Communities

China: a state of "tailings disaster"

Published by MAC on 2011-01-31
Source: Xinhua, Global Times, New York Times

Last year's Zijin tailings dam disaster in China was one of the most serious of its kind  - and appropriately recognised as such on MAC. See: Zijin Mining fined $1.4m for July gold mine spill

But it was far from being the only one.

Indeed, according to a recent government report, at the end of 2009 China had 12,523 tailings ponds, of which no less than 2,098 (16.8 percent) exhibited various safety problems.

It's only just over two years since the worst reported mine tailings dam disaster in history killed at least 277 people in Shanxi province.

Now, a Chinese tailings pond expert is calling on the government to "learn from foreign countries how to set up insurance systems for mining companies".

Then, "if a mining company goes bankrupt, the insurance company would provide coverage for potential pollution problems that could occur and result in liabilities and expenses for the mine owner".

Of course - to stand any chance of being effective - such a scheme should be mandatory. In any case it is intended to operate only after a potentially catastrophic event.

At least the posting of a stipulated financial bond by mining companies, designed to cover the "worst possible scenario", acts as a some deterrent to embarking on a calamitous project in the first place.

As global demand for rare earths appears to rise, so pressure is being applied on China to release supplies of these metallic elements, considered essential for computers and so-called "clean energy" technologies.  

Meanwhile - and whether or not it is designed to justify a squeeze on supplies  - the Chinese government is finally trying to impose environmental rules on its many rare earths' operations.

Tailings, and other mined wastes, from these operations are among the most hazardous dumped around the country.

[Updated on 4 February 2011]


Tailings take toll on nature and people


19 January 2011

EVERY time she meets guests from outside her village, 59-year-old Zhang Baihua asks the same question - would you dare to drink our water?

It is not a question that requires an answer, but more like a bitter joke for Zhang and her fellow villagers since their water is polluted and undrinkable.

The water from Zhang's well has turned yellow and smells foul; there's white foam on the surface.

"It's not drinkable but can be used to wash clothes after sedimentation," she said. A 120-meter-deep well provides water for the whole village.

Zhang lives in a small village called Xinguang Eight in suburban Baotou City of north China's Inner Mongolia Autonomous Region.

At the eastern end of the village, a tailings pond for the residue of ore covers more than 10 square kilometers and the water is six meters deep.

The tailings pond is an expanding man-made lake that holds by-products of rare earths and iron extraction processes, including leftover rare earth elements, heavy metals such as niobium and thorium, and other substances.

The pond, only one kilometer away from Zhang's home, has been collecting mine wastes produced by the Baotou Iron and Steel Group (Baogang) since 1965. The underground water in the areas around Baogang's tailings pond was polluted by leakage from the pond, the National Business Daily said, citing a report issued by the Baotou environmental monitoring station in 2006.

Poorly compensated

The report, based on testing of water samples from five wells in Dalahaishang Village in 1995, 2000 and 2006, said the water was not safe for drinking or irrigation. The water samples contained the same pollutants as in the tailings pond.

The Baogang Group drilled several deep wells to ensure safe drinking water for about 4,000 residents in Zhang's village, Dalahaishang Village and three other villages around the pond.

The steel maker also invested 300 million yuan (US45.39 million) to resettle these villagers. However, because of disputes about compensation, no one villagers agreed to move and completed apartments remained vacant.

"I have to pay extra charges for the resettlement housing if I move. Meanwhile, the new place is too far from my cropland and my son's working place," said 73-year-old Zhang Sanhu in Xinguang Three village.

Disputes over Baogang's tailings pond pollution have been going on for years, and this is neither unusual nor the most threatening one in China.

On September 8, 2008, an unlicensed iron ore tailings pond in north China's Shanxi Province burst, unleashing a wave of mud and mining wastes that inundated a downstream village with more than 1,000 residents.

The disaster resulted in at least 277 deaths and economic losses of more than 96 million yuan. The incident led to resignation of the provincial governor. This is still considered the world's largest disaster involving collapse of tailings dams.

A mining boom since 2000, fueled by the Chinese economy's increasing demand for metals, has left the country studded with unsafe tailings ponds, said Tian Wenqi, a tailings expert with China's State Administration of Work Safety. He is also a senior engineer at China Enfi Engineering Corp (Enfi), a company set up by China Nonferrous Engineering and Research Institute. "In terms of the pond numbers, China might top any other country in the world," Tian told Xinhua in an exclusive interview.

According to government figures, at the end of 2009 China had 12,523 tailings ponds, of which 2,098, or 16.8 percent, had various safety problems.

To make the situation worse, small ponds account for 95.4 percent of China's total. These ponds, designed with a storage capacity of less than 1 million cubic meters, are susceptible to damage from as earthquakes, hurricanes and floods.

"Tailings ponds are indispensable for the mining industry, since only a tiny fraction of mining ore contains useful metals and the rest is waste, or tailings, held in ponds," Tian said.

The ponds are major sources of environmental pollution and mining accidents. "The dams holding the tailings ponds are not always examples of high-level engineering and in some cases may be made by simply bulldozing the tailings themselves into an embankment," he said.

The majority of ponds are operated by small private mining companies, he said, and since they try to cut operating costs "they will not pay much attention to pond safety," he said.

China's huge number of inadequate tailings ponds have become a grave challenge for the country and there is a serious shortage of designers specializing in tailings ponds.

"China used to have 20 to 30 tailings pond design institutes, but that was far from enough for the growing demand," Tian said.

He warned that the scarcity of qualified designers meant that some small ponds are built without any design and others are designed by unqualified personnel and represent safety threats.

Another major problem is that pond sites are often unavoidably near populated places and ecologically fragile regions.

For example, the Majiatian tailings pond of Panzhihua Iron and Steel Group in Sichuan Province has a designed storage capacity of 187 million cubic meters. It is located on the upper reaches of the main stream of the Jinsha River, an important tributary of the Yangtze River.

Role of insurance

China has solicited public opinion on the revision of the 2006 regulation on safety management and supervision of tailing ponds.

According to Tian, the revised regulation would probably add specific rules about re-use of tailings and government monitoring.

Zhang Dezhou, a tailings pond expert at Enfi, said China should learn from foreign countries how to set up insurance systems for mining companies.

"Any mining company would have to receive an insurance company's guarantees before its operation begins," Zhang said. Under this system, if a mining company goes bankrupt, the insurance company would provide coverage for potential pollution problems that could occur and result in liabilities and expenses for the mine owner.

"The insurers would understand the mining company's technical and business conditions, as well as the potential risks. It's like arranging an examiner interview for students before they can start their tests," Zhang said.

Zijin Mining to pay $3m fine for hazardous waste water leaks


1 February 2011

HONG KONG - Chinese gold miner Zijin Mining will fork out 20 million yuan ($3 million), its latest penalty for its key role in hazardous waste water leaks last year, a court judgement showed on Monday.

Zijin, in a filing to the Hong Kong stock exchange, cited a summary of the gold miner's first trial, stating it had to pay a total of 30 million yuan, less the 9.56 million yuan it paid last October in administration costs.

Poor maintenance of the lining of the waste reservoir at the Zijinshan copper and gold mine led to two breaches in July 2010, dumping toxic waste into Fujian province's Ting river, killing a large number of fish and polluting drinking water for tens of thousands of people.

Zijin, which had enjoyed a reputation as one of China's premier mining firms and has mining interests overseas, has run into frequent trouble with tailing dams.

In September last year, the firm halted production at a tin mine in southern Guangdong province after it said a leak in the mine's residue pool caused by heavy rains had flooded nearby villages and killed several villagers.

Zijin shares closed up 0.3 percent on Monday, having fallen 3 percent in the past 12 months, underperforming the benchmark index, up 17 percent in the same period. (Reporting by Farah Master; Editing by David Holmes) ($1=6.581 YUAN)


Mineral wealth comes at a cost in Inner Mongolia

By Zhang Han in Baotou

Global Times

14 December 2010

When Li Yongkuan, 62, joined the Baotou Iron and Steel (Group) Company (Baogang Group) in the 1970s to exploit precious mineral resources, he was grateful for the opportunities for economic development generated by the project.

Li, a resident of Xinguang village in Baotou, the Inner Mongolia Autonomous Region, occasionally worked with the group over a period of about 10 years. But in recent years, any feeling of optimism Li had has been replaced by the pain of seeing his fellow villagers sickened as a result of the pollution caused by the company he worked for.

The Baogang Group's main plant processes materials taken from the Baiyunebo Mine, 150 kilometers from Baotou. It is home to the largest stores of iron reserves in North China, and the largest amount of rare earth reserves in the world.

The roads along Li's village are filled with dust, and iron tubes stretch to every corner, while massive piles of ore waste can be seen everywhere. The village itself looks like one big factory.

At the western end of the village stands an 11-kilometer-square tailings dam, which has been collecting waste from processing rare earth and iron for 45 years.

According to Du Youlu, the director of the environmental protection office at Baogang Group, the tailings are made up of 9.3 million tons of rare earth, and 70,000 tons of thorium, a radioactive substance used in producing nuclear power and other materials.

"It is a pool of treasure," Du told the Global Times.

However, villagers like Li do not see it this way. Farmland in his and four other villages have been rendered desolate due to the expansion of the Baogang Corporation, the biggest player in ore resources in northern China.

"We have suffered so much from the dam for so many years," Li told the Global Times.

Chemicals from the dam have been seeping into underground water that feeds their wells, crops and livestock. "When we water our plants, they just die quickly," Li said.

Danger levels

A report in 2002 from the Baotou Environmental Protection Bureau said the underground water has been contaminated, with more than 10 chemical substances exceeding safety limits. The amount of thorium in the soil surrounding the dam is 36.3 times that of normal soil in Baotou.

The bureau also said the amount of radioactive substance surrounding the dam, which winds can spread over a distance of 10 kilometers, is 10 times higher than in other areas. The bureau did not provide the latest pollution data.

"The lands are all deserted now, and the people here often suffer from nausea, dizzy spells, arthritis and migraines," Li said.

Li Ertao, a 66-year-old villager in Dalahai, one of the five villages, lost his teeth in his early 40s. "I was told that the radiation causes our bones to become extremely fragile."

Du said an average of 7 million tons of waste are added to the dam every year. At 30 meters high, it is growing at an average of 0.9 meters annually.

Problem solved?

For Du, this environmental catastrophe is a problem that has already been solved. He said they have invested an average of 40 million yuan ($5.9 million) a year on measures to prevent pollution, including building channels to stop water leaking underground, and keeping the dam wet to prevent the dust from being spread by the wind.

The company spent 30 million yuan ($4.4 million) on building a new residential district for the affected villagers. "If people move out, what harm could the dam do?" Du said.

However, experts fear that another environmental catastrophe looms if the dam collapses. "Overall, there is no doubt that the increasing amount of waste on the dam will do harm to the environment," Li Lemin, a professor of chemistry at Peking University, told the Global Times.

According to research carried out by Xu Guangxian, a specialist in the chemical and physical properties of rare earths, the Baogang Group continues to exploit precious mine resources despite the existence of large amounts of unused rare earth in the dam.

Xu said if that unused rare earth is utilized, exploitation of the eastern and main mines could be stopped.

However, that suggestion is not likely to be implemented, as Du said production should remain at around 12 million tons each year, the maximum capacity of the east and main plants of the Baiyunebo Mine.

Li, the chemistry professor, said the area's coal reserves will be depleted in 35 years if exploitation continues at its current rate. "Reducing production is a win-win situation, in that the mine will be protected and the pollution around the tailings dam will be reduced," he said.

However, Li admitted that authorities are caught in the all too common dilemma over whether to give more priority to environmental protection concerns or economic development.

China's cleanup campaign deletes 284 illegal mines


18 January 2011

China's Ministry of Land and Resources announced Tuesday that authorities in the country have found and ordered the clean-up of more than 280 illegal mines in an effort to regulate the exploration of valuable minerals, such as rare earths.

The number of explorations for minerals such as rare earth, tungsten, tin, and antimony were reduced to 116 from 400 in 11 provinces and regions in the country in spot checks led by teams dispatched by the ministry, a statement on its website said.

The campaign, initiated last June by the ministry, has aimed to end the illegal and sometimes widespread excavation of valuable minerals.

The ministry earlier ordered that the clean-up of illegal mines should be completed before the end of November.

China supplies 90 percent of the world's rare earth minerals, even though it has only around 36 percent of the world's reserves.

The Chinese government has also increasingly focused on the environmental impact from rare earth explorations, as its rare earth export quotas stood at 30,300 tonnes for 2010, a drop of almost 40 percent from 2009.

China Seizes Rare Earth Mine Areas

By Keith Bradsher

New York Times

20 January 2011

HONG KONG A Chinese government agency has taken steps to more tightly manage the production and export of rare earth minerals, crucial materials used in a wide range of technologies and products vital to the West.

The agency, the Ministry of Land and Resources, invoked a seldom-used mining law to take direct control of 11 rare earth mining districts in southern China.

The ministry said in a statement, posted on its Web site Wednesday and briefly mentioned Thursday by the state media, that rare earth mining in those districts, all at the southern end of Jiangxi Province, had been placed under its national planning authority.

That step removes administrative oversight of mining from provincial and municipal control; local officials in southern China are widely suspected of collusion with crime syndicates responsible for illegal strip-mining and refining of rare earths.

The ease of digging up and refining some of the most valuable rare earths from the clay hills of southernmost Jiangxi Province and northernmost Guangdong Province, together with soaring prices, has led to a surge in illegal strip-mining that has turned many hillsides into lunar landscapes. Crime syndicates have dumped the mine tailings, including powerful acids and other materials, into local waterways. The fields and water supplies of peasant farmers who live downstream have been contaminated.

The land ministry, which has inspectors, hinted that it planned to place additional districts under the control of the national government. It said repeatedly in the statement that this was the first designation of national rare earth mining areas. A legal notice dated Jan. 4 was posted with the statement and invoked Chinas obscure, decades-old planning statute.

American officials had said before the current visit of President Hu Jintao of China to Washington that they wanted some assurance that China would continue to supply rare earths. But Chinese officials have been leery of international commitments on mining output, and the 41-point joint statement issued Wednesday by the United States and China after the meeting of President Obama and Mr. Hu made no mention of rare earths.

China produces 92 percent of the worlds light rare earths like cerium and lanthanum, which are used in applications like glass manufacturing and oil refining, and 99 percent of the worlds heavy rare earths like dysprosium, which are used in trace amounts but are vital for products like smartphones and compact fluorescent bulbs.

Most of the heavy rare earths come from an unusual geological formation that straddles the hilly, sometimes lawless southern border area of Jiangxi Province with Guangdong Province. According to geologists, it is the only known commercial deposit of rare earths in the world that has virtually no contamination from thorium, which is radioactive.

Many companies in the West indirectly depend on illegal mining and smuggling. Industry experts estimate that illegal production accounts for about a seventh of the supply of light rare earths in the world and as much as half of heavy rare earths.

Smuggling is less common for light rare earths, partly because they are less valuable. They sell for about $20 a pound outside China, compared with more than $100 a pound for some of the heavy rare earths.

Most of Chinas light rare earths come from a large state-owned iron ore mine in a desert near Baotou, in northern China, where illegal mining and smuggling are more difficult and are becoming harder. Security forces have begun erecting electrified fences to discourage trespassers.

China has repeatedly cut its quotas for exports of rare earth minerals from government-approved mines and refineries in the last two years, while raising taxes on the exports. It separately imposed a two-month, unannounced ban on exports of rare earths to Japan during a territorial dispute last September and carefully checked other countries orders for rare earths to discourage trans-shipment to Japan.

The United States Energy Department concluded in a report last month that clean energy industries in America relied heavily on imports of rare earths and would be highly vulnerable to supply disruptions for as long as the next 15 years. Efforts to dig mines elsewhere face many legal and environmental obstacles.

The Obama administration has included China's export restrictions on rare earths in a broad investigation of whether China has violated World Trade Organization rules to help its clean energy exports; the United Steelworkers union has accused China of limiting exports of rare earths to force manufacturers to move their factories to China, an accusation supported by comments in 2009 by Chinese provincial officials saying exactly that.

W.T.O. rules ban most export quotas and taxes and require countries to provide foreign buyers with the same access to natural resources as the best-connected domestic buyers.

But China has recently defended the export quotas and taxes as needed for environmental protection, invoking an exception in W.T.O. rules that allows the conservation of natural resources.

Alan Wolff, a former senior United States trade official and now the chairman of the international trade practice at the law firm Dewey & LeBoeuf, said the crackdown against illegal mining, which has included numerous raids by Provincial police in northern Guangdong Province, could buttress its defense against W.T.O. cases by showing Beijings concern for the environment. But Mr. Wolff added that a W.T.O. case against Chinas rare earth export restrictions could still be successful.

In addition to seizing control of the rare earth mining districts in southern Jiangxi Province, the Ministry of Land and Resources announced that it was imposing national planning authority on an iron ore mining area in the western Chinese province of Sichuan that has two other scarce and valuable metals, titanium and vanadium. Titanium has many applications in aerospace and other industry sectors, while vanadium is used in the production of sulfuric acid, which is the main material needed to refine rare earth ores.

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