Understanding AMD from a Business Model Perspective Public
Debate on AMD 29 August 2013 by Anthony Turton Water Stewardship
Council Trust Image Anthony Turton 2011
Slide 2
Emerging Trends and Issues Expect fast rollout of
infrastructure in all gold mining basins now that AMD is better
understood at technical/engineering level Who Pays for What? Two
Business Models underpinning AMD mitigation Legacy Model (simple
but costly) PPP Model (complex cost/benefit matrix) Two Process
Models are implied but latent Centralized Model (Water Boards
providing potable quality water to ALL users at a flat tariff) Dual
Steam Model (off-take agreements for non-potable AMD treated water
to industrial users at different tariffs)
Slide 3
Gold Production Life Cycle Work for the GDARD MRA Reclamation
Project shows the existence of three peaks in gold. Source:
Hartnady s specialist report in GDARD MRA Reclamation Project First
peak was shallow gold driven by surface resources that were easily
accessible. Third peak is about the recovery of gold from tailings
dams driven by metallurgical engineering. The Legacy Model follows
this trajectory because it assumes that mining has ended The PPP
Model follows this trajectory because it assumes that the business
case for mining can be reinvented Second peak was deep gold driven
by ventilation engineering and rock mechanics.
Slide 4
Legacy Model AMD is the result of irresponsible mining AMD is
generated mostly in the void AMD will be a perpetual problem dumps
remain Void remains open forever Zama Zama/crime issue Uranium
remains a hazard dust fallout Service provider will be a contracted
third party Taxpayer will foot the entire bill forever
Rehabilitation is not part of the process Mine companies inevitably
become insolvent Water has to be treated to potable standards
Economics favours Centralized Process Model Known OPEX cost to
taxpayer = R 12.00 m (neutralized water only) (best available data
might change)
Slide 5
PPP Model AMD can be mitigated by responsible Closure Mining
AMD is mostly generated on surface AMD is temporary until dumps are
rehabilitated Void can be closed out with emerging best practice
Uranium can be sequestered (possible subsidy?) Service provider is
restructured mining companies Revenues from Closure Mining will
subsidize rehabilitation Rehabilitation drives the process land is
the end product Mine companies become rehabilitation companies
Water can be treated to industrial standards Either Centralized or
Dual Stream Model Known OPEX cost to taxpayer = R 4.00 m
(neutralized water only) (best available data might change)
Slide 6
Centralized Process Model State owns all water resources State
has the sole right to treat and distribute it Energy analogy =
Eskom All water treated to one standard (potable) One price based
on average national cost Treated AMD will become drinking water
Reconciliation of demand/supply at national level Monopolistic so
price insensitive Consistent with current laws and policy
Slide 7
Dual Stream Process Model State is custodian of all water
resources Partnerships for treatment and distribution Energy
analogy = Independent Power Producers Water treated to different
standards Varied price based on local treatment cost and end-users
requirement AMD does not have to become drinking water
Reconciliation of demand/supply at local level Non-monopolistic so
price sensitive Will need some legal / policy reform
Slide 8
Centralized Process Model Dual Stream Process Model Legacy
Business Model PPP Business Model Mining is the problem State to
contract third party service provider (E-Tolls Model) Taxpayer to
pay in perpetuity Landscape not rehabilitated AMD becomes drinking
water HDS Storage facilities needed Cost = R12.00 m (neutralized)
Closure Mining is the solution Mines are service provider Mining
revenues cover majority of cost (partnership) Landscape is
rehabilitated AMD does not become drinking water HDS Storage
facilities not needed Cost = R4.00 m (neutralized) Economics do not
stack up for this combination Process can support this combination
HDS Storage facilities not necessarily needed depending on process
selected Economics supports this combination Process supports this
combination HDS Storage facilities not needed dependimg on process
selected
Slide 9
Rehabilitated Land is the result of the PPP Model Source: Tang
& Watkins (2012) The Big Picture Post-Mining
Slide 10
Flow Pathway A Genesis of AMD Flow Pathway B Gatekeeper Flow
Pathway C Aquatic Ecosystems Flow Pathway D Underground Fallout of
Uraniferous dust Rainfall Decant Ingress AR Turton 2013 Streamflow
Ingress Wind AMD is complex so we need carefully designed
interventions at specific parts of the overall cycle Misdiagnosis
of the cause-effect relationships will cause massive investment
into the wrong intervention and an angry taxpaying public over
time
Slide 11
Flow Pathway A Mine Dump Rainfall Dust Wind Evaporation AR
Turton 2013 Flow Pathway A Genesis of acidification Scale -
Localized in the dump Mechanism - acid rain falls on alkaline
tailings generating hydrogen Acid leaches Uranium Wind blows dust
over a larger geographic area Remedy: Policy on coal combustion
Rehabilitate to prevent ingress and dust Remove dump if possible
Uranium sequestration AR Turton 2013
Slide 12
Flow Pathway B Gateway to alternative pathways Scale Quaternary
catchment Mechanism mostly hydraulic Either AMD seeps from the base
of the dump into the void Or AMD flows off the dump into adjacent
wetlands Remedy: Rehabilitate to prevent slumping and erosion
Remove dump if possible Uranium sequestration Flow Pathway B
Gatekeeper Dump Surface Underground AR Turton 2013
Slide 13
Flow Pathway C Aquatic Ecosystems Scale - Catchment and beyond
Mechanism hydraulic mobilization of dust deposition and dump
erosion by rainfall BUT also precipitation in rivers Yellow Boy as
manifestation Metals accumulate in wetlands Remedy: Rehabilitate
dumps to prevent wind and water erosion Wetland rehabilitation to
sequester metals and trap sediment Ingress control into void
Neutralize decant as temporary measure Uranium sequestration Flow
Pathway C Aquatic Ecosystems Dust Rainfall Sediment from Dumps
Streamflow AR Turton 2013
Slide 14
Flow Pathway D Underground Scale Mining basin and multiple
catchments Mechanism Ingress from surface hydraulic flows Acid
mobilizes heavy metals and oxidises pyrite in pillars Bacteria
(Thiobacillus feroxidans) convert Pyrite to additional acid Remedy:
Ingress control from surface Pillar removal Closure of void by
paste backfill Drawdown of water level Neutralize as temporary
measure to prevent Uranium mobilization AR Turton 2013 Ingress from
Dump Flow Pathway D Underground Ingress from rivers Decant to
rivers
Slide 15
Image Anthony Turton 2013 Thank You
Slide 16
Tailings Management AMD Management Rainfall as a Variable
Deposited at high pH (>10) Solutions: (1) legal reform of waste
classification, (2) develop MRA policy, (3) remove/consolidate
dumps Lowers pH and triggers release of Hydrogen genesis of
acidification Acidifying (pH
