Melting glaciers add to woes at Kumtor

28 October 2014, Asia Times Online

Kumtor mine is the largest open pit gold deposit in Central Asia, whose majority shareholder since 2004 has been Centerra Gold, a Canadian mining company. The mine sits at an altitude of 4,000 meters above sea level, in the Tien Shan mountain range and among some of Kyrgyzstan’s – and the region’s – most important glaciers. These feed into the Naryn (Kyrgyzstan) and Syrdarya (Uzbekistan) rivers. Kumtor’s main gold-bearing ore lies under glaciers adjacent to Kyrgyzstan’s Sarychat-Ertash state reserve.

Centerra Gold has consistently dismissed as untrue that operations at Kumtor have had negative implications for the

glaciers, which are reportedly melting with observable speed due to years of dumping rock tailings onto the ice sheet. The Canadian company has backed its position with expert evaluations from consultancies such as Environmental Resources Management Ltd (ERM) and AMEC Earth and Environmental UK Ltd.

Nonetheless, local and international environmentalists have been ringing alarm bells over the glaciers’ melting ice sheet at Kumtor, as well as over Centerra’s withholding information related to the effects of mining operations on the Davydov and Lysyi glaciers. Environmental concerns only add to Centerra’s predicament, as the company has been marred in an ongoing public controversy over corruption allegations that occurred under the watch of previous Kyrgyz governments.

In 1994, the government of the Kyrgyz Republic approved Environmental Impact Assessment study for Kumtor mine. The study specifically referred to the removal of the waste rock and seized ice from the mining site, which should be placed in the valley below, downstream from the Lysyi and Sarytor glaciers. This is in line with domestic environmental legislation, such as the 1991 law “On the protection of nature”, as well as the 1994 law “On Water”.

Local environmentalists have long opined that operations at Kumtor mine violate Kyrgyz law. From its part, the State Commission on Kumtor found in a 2012 probe that since the beginning of operations at the mine, the guidelines of the waste rock and ice recycling plan were not followed and that the company had instead chosen the option of dumping tailings onto the surface of the glaciers.

This could have a serious impact on water resources in Kyrgyzstan, and beyond. Centerra’s refusal to allow independent expert Robert Moran to inspect the mining site in 2012 has led to increased public scrutiny on this issue. Mr Moran claimed then that “water testing has shown numerous chemical pollutants have high concentrations around the mine area, sometimes exceeding international water quality standards”. Centerra’s representative Stephen Lang statedthat Moran’s report “paints an inaccurate picture of Kumtor’s environmental practices and of the regulatory framework within which it operates … The Kumtor mine has a record of safe, environmentally responsible mining in the Kyrgyz Republic”.

Centerra Gold, however, admitted to dumping waste rocks on glaciers in its 2012 environmental report, which reads: “Historically, Kumtor deposited waste rock on glaciers, mainly the Davidov Glacier, located near the open mine pit.” The report adds: “This practice has changed and waste rock is no longer being deposited on the Davidov Glacier.”

It thus appears that Canadian mining giant Cameco first – one of Kumtor’s main shareholder from 1994 to 2009 – and Centerra since its 2004 inception have operated in breach of local environmental legislation – at least until 2012.

The impact of these dumping on the glaciers should not come as a surprise. In a 2006 research paper by the International Glaciological Society on glacier changes in the central and northern Tien Shan during the last 140 years, the authors point out that already ‘by the mid-1990s, the right side of the [Davydov] glacier terminus had been buried under a bank of waste from the gold mining.’ Likewise, the paper continues, ‘”The surface of [the Lysyi] glacier has also been covered by a bank of waste from the gold mining and by blocks of ice that were removed from a hanging glacier to accommodate gold mining.”

Moreover, while Centerra’s Boroo gold mine in Mongolia produces 1,6 million ounces of gold, the land-reclamation fund allotted to the project in 2011 amounted to $25,9 million. Company records in the same year have shown that Centerra allocated to Kumtor mine’s reclamation fund only $27.9 million, despite the fact that the project had yielded 8,4 million ounces of gold, or roughly five times more than Boroo’s. In 2013, following recommendations by the State Commission and consulting company AMEC, the figure was increased to $33.4 million.

No permit for waste disposal
Kumtor Operating Company produces 13 different kinds of waste. Since the time it started operations in 1997, however, it has not acquired the necessary permits for waste disposal. In an August 27, 2012, letter to co-author Dinara Kutmanova, KOC president Michael Fisher himself admits to this breach: “Concerning the permission to dispose of waste, we would like to inform you that the sites allocated for the disposal of domestic and industrial waste are currently operating without the relevant documentation.”

ERM, a leading global consultancy on environmental issues, comes to the same conclusion in a 2012 report commissioned by Centerra Gold on environmental due diligence, which states: “Permit for wastes (solid domestic waste and secondary production waste) disposal into environment” are “currently not formally in place and should be obtained from the relevant supervisory agencies by the Site”.

On February 18, 1992, Kyrgyzstan, Kazakhstan, Uzbekistan, Tajikistan and Turkmenistan signed an agreement on cooperation, joint management and protection of trans-boundary water resources. The signatories committed not to allow any operations in their respective territories that would harm the interests of the other states parties, that would inflict damage on them and lead to the contamination of their water resources (Article 3), as well as to promote broad exchange of information on the integrated use and protection of water resources in Central Asia (Article 5). The negative effects of mining at Kumtor on Kyrgyzstan’s glaciers raise questions about the legality of Centerra’s operations in view of the existing conditions that do harm source of the regional water resources.