The federal government is failing to properly monitor resource development projects north of the 60th parallel despite recorded concerns raised internally by government staff, according to a new report by Canada’s environmental watchdog.
Last week’s report by the Commissioner of the Environment and Sustainable Development, Scott Vaughan, claims both the environment and government coffers have been left unprotected by a lack of monitoring on the part of the department of Aboriginal Affairs and Northern Development (AANDC).
The audit found AANDC failed to conduct over 70 per cent of required site visits to all resource development projects in the Northwest Territories in 2011, including mines, and that employees within the department had raised red flags to no avail.
“Departmental records indicate that members of the department’s staff raised concerns internally about the level of monitoring being done,” Vaughan’s report states.
Those inspections, Vaughan noted, are a necessary condition for companies obtaining a licence or permit, and ensure that terms governing such issues as fuel storage, the structural soundness of tailings ponds and disposal of hazardous wastes are being adhered to.
Vaughan also found that AANDC is not keeping satisfactory records of existing projects required to ensure companies have enough money to cover the full cost of decommissioning a facility and restoring the site – and whether those assurances are expired or not – so that the department is not stuck footing the bill.
He also found that the department doesn’t compare on a regular basis whether or not the financial deposits from companies for each licence and permit are sufficient to meet the costs of reclamation of land and water.
He said assurances from three of 11 mines in Nunavut, alone, accounted for security shortfalls totalling $11 million.
In addition, the commissioner raised concerns about the government’s “polluter-pays principle,” which holds that liability for impacts on human health and the environment remains with the owner or operator of the mine, but does not require them to have insurance.
“In the event that the funds on hand are not sufficient to restore a site on federal lands, there is a risk that the government would have to assume these financial implications,” reads the report.
Further analysis showed AANDC accepted $17.6 million in promissory notes for reclamation costs from companies, which are not guaranteed by a bank in Canada and thus do not satisfy legislative and regulatory requirements.
“We have concerns about the continuing enforceability of this security,” the report states.
Additional concerns raised include the outdated values contained within 1971 regulations, which cap securities for land-use permits at $100,000.
“This limit does not reflect current costs for reclaiming a site,” the commissioner wrote.
Vaughan recommended that AANDC follow the regulations for inspections and develop a “comprehensive inventory system” to keep track of projects and the securities required to meet expected reclamation costs.
AANDC spokesperon Geneviève Guibert told The Journal that the department is already engaged in the appropriate monitoring required.
“Aboriginal Affairs and Northern Development Canada (AANDC) regularly verifies the level of securities for mines and other projects to ensure security is sufficient to cover the costs of reclamation,” she said in an email.
“The department’s risk management process ensures that each operation is monitored in a careful and considered manner to protect people, property and the environment.”
She said the frequency of inspections is dictated by the risks posed by the projects.
“While some operations require monthly inspections, lower risk operations require less frequent inspections. Inspectors assess each file based on possible impacts on people, property or the environment.”
The department as a whole has responded that it agrees with Vaughan’s recommendations, promising to implement a risk assessment framework and management strategy for inspections and adjust securities as required to reduce the liability of the department.
“We have reviewed the commissioner’s report and will continue working to improve the risk management and inspections processes, and ensure that appropriate securities are maintained at all times,” Guibert said.