Improved Transparency for Environmental Security Bonds
From today the Department of Primary Industries and Resources will publish the amount of money that is held as environmental security by the government on behalf of individual mines. Mining companies are required under law to provide a certain sum to the government to fund the cost of rehabilitating the site after mining is complete in the form of an environmental security. Bonds also operate as a financial incentive for compliance with the Mining Management Actand cover the cost of any environmental damage as a result of regulatory breaches.
The total finance of these bonds has been withheld from the public which is a major barrier to ensuring the environmental accountability and transparency of the industry. There are no good public policy arguments for keeping security bonds confidential. $1.3 billion is currently held by the government, 90% of which is for nine mines.
This policy shift represents a major step forward in improving transparency and accountability which is drastically needed for ongoing community acceptance of mining in the NT. ALEC has been calling for greater transparency in the industry for many years and is heartened by this new direction in mining policy. These bonds represent the estimated environmental cost of an entire project so it is important that this information is in the public realm.
The capability of a mining project to gain and hold a social licence is dependent on the company being able to prove environmental credentials through providing the necessary finance for rehabilitation. Security bonds are necessary to ensure that proper environmental rehabilitation can occur regardless of the financial state of the company. It is fundamental to good governance and environmental justice that the cost of mineral extraction is born by industry rather than the land and local communities.
This decision comes at a pivotal moment for the Territory that is grappling with the issue of legacy mines that are leaching contaminants into the environment because companies are escaping rehabilitation and compliance responsibilities. Mining companies in the NT are not entirely accountable to local communities or the environment because of the barriers to accessing vital information about ongoing rehabilitation and environmental obligations.
Transparency around the value of mining security bonds will help determine whether individual mines are able to sustain their social licence to operate. Improved transparency represents a shift in favour of the public interest of environmental accountability as opposed to protecting the commercial interests of the mining industry.
The total security figures for each operating mine can be accessed at: https://dpir.nt.gov.au/mining-and-energy/mines-and-energy-publications-information-and-statistics/mining-environmental-reports/mining-securities
Note: Mining management plans for major operating mines remain commercial in confidence.