Taxpayers should foot the bill for acid mine drainage (AMD), as they benefited from the economic growth brought about by…
This was the argument put forward by mines at a recent debate on AMD in Johannesburg. “Everything we see is a product of mining. We might as well return to living a primitive life in a cave if we want to stop mining. Society has benefited from this sector, so cleaning it up should not be the sole responsibility of mines,” said Eddie Milne, CFO of Mintails. Milne said that because mining contributed 20% of the country’s GDP, the public often wondered why mines could claim that they did not have the money to clean up.
“The mining sector has an income of R350 billion annually, but cleaning the water will cost about R7,58/ m3 and 150 mega litres of water must be cleaned per day. Even then, the water will be of a non-potable standard and can only be used for industrial purposes,” he said. At R7,58/m3 it would cost mining companies R415 million per year to treat AMD. If the water were treated to a potable standard, the cost would triple.
Milne said that introducing additional taxes on mines to pay for cleaning the environment post-mining was also out of the question, as mines were already overtaxed. “The direct tax rate for mining companies is about 38%, but then there are still stealth taxes such as environmental funds, community upliftment projects and royalties. So the true rate that mines pay is about 45%, while corporate companies only pay about 28%,” Milne said.
But Mariette Liefferink, CEO of the Federation for a Sustainable Environment, said this argument would mean that the public paid the environmental cost, while private companies made profit. “How the mines fund the clean-up is up to them. The last mine standing doesn’t have to take on the full burden, but they will have to work out how it will be funded. The government should only pay in instances where a mine is truly abandoned,” Liefferink said.
She noted that since 1912 it had been illegal to allow polluted water from exiting a mine’s property. “The National Environmental Management Act (Nema) obligates the polluter to pay for pollution. Nema has borrowed heavily from foreign jurisdictions and these countries have had no difficulty in holding the culprits responsible, no matter their economic contribution to the GDP.”
Liefferink said that neutralised AMD contained 2 500mg sulphate per litre of water, while the safe standard for sulphate in water used for irrigation is 150mg. Ken Bouch, divisional head of Fraser Alexander Water Treatment, said there was 200 000m3 of water in the Witwatersrand basin that had to be pumped and treated every day to solve the AMD problem. This water contained dissolved solids that polluted the water.
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