1 Introduction This Advisory Note is designed to assist in the establishment of the level of security required to ensure performance in relation to liabilities incurred by mining activities. Securities are to be regularly reviewed such that the amount required reflects the current site liability. A security calculation can be triggered by: The Application for an Authorisation process; A request from operator based on changes in potential lease liability; Findings of periodic audits and inspections, which highlight deviations from an approved Mining Management Plan (MMP); Amendments to an approved MMP; and At the time of sale, transfer or mine closure. 2 Legislation Pursuant to section 40(2)(g) of the Mining Management Act (MMA), a costing of closure activities must be included in a MMP submitted to the department in support of an application for Authorisation of a site, or submitted in response to changes to operational activities. A security is required under section 43 of the Northern Territory (NT) MMA to enable the Minister to prevent, minimise or rectify environmental harm resulting from mining activities. 3 Purpose and Background Security will be applied to all Authorisations granted under the MMA. The Minister shall determine the level of security commensurate with protecting the community from closure liabilities and optimising the benefits to the community from the proposed project. The default expectation for operators of mining interests under the MMA is to submit 100% of the security calculated for rehabilitation. Calculation of securities will be based on the actual cost of rehabilitation commensurate with the size, environmental risk and expected project life in accordance with advisories approved by the Minister. Securities will be regularly reviewed and adjusted taking into consideration progress in rehabilitation as well as new or expanded activities. The operator of mining interests is responsible for rectifying any environmental harm arising from mining activities and for final rehabilitation of the affected area. If there is a transfer of operators, liability for outstanding rehabilitation will become the responsibility of the new operator and as part of the transfer the new operator will be required to replace the existing security held for the project. A security will be released once criteria specified in the approved closure plan have been met. These criteria include commitments and responsibilities pertaining to post closure monitoring and management of potential liabilities at the site. Security will be sought in the form of Cash or Bank Guarantee.
1 Introduction This Advisory Note is designed to assist in the establishment of the level of security required to ensure performance in relation to liabilities incurred by mining activities. Securities are to be regularly reviewed such that the amount required reflects the current site liability. A security calculation can be triggered by: The Application for an Authorisation process; A request from operator based on changes in potential lease liability; Findings of periodic audits and inspections, which highlight deviations from an approved Mining Management Plan (MMP); Amendments to an approved MMP; and At the time of sale, transfer or mine closure. 2 Legislation Pursuant to section 40(2)(g) of the Mining Management Act (MMA), a costing of closure activities must be included in a MMP submitted to the department in support of an application for Authorisation of a site, or submitted in response to changes to operational activities. A security is required under section 43 of the Northern Territory (NT) MMA to enable the Minister to prevent, minimise or rectify environmental harm resulting from mining activities. 3 Purpose and Background Security will be applied to all Authorisations granted under the MMA. The Minister shall determine the level of security commensurate with protecting the community from closure liabilities and optimising the benefits to the community from the proposed project. The default expectation for operators of mining interests under the MMA is to submit 100% of the security calculated for rehabilitation. Calculation of securities will be based on the actual cost of rehabilitation commensurate with the size, environmental risk and expected project life in accordance with advisories approved by the Minister. Securities will be regularly reviewed and adjusted taking into consideration progress in rehabilitation as well as new or expanded activities. The operator of mining interests is responsible for rectifying any environmental harm arising from mining activities and for final rehabilitation of the affected area. If there is a transfer of operators, liability for outstanding rehabilitation will become the responsibility of the new operator and as part of the transfer the new operator will be required to replace the existing security held for the project. A security will be released once criteria specified in the approved closure plan have been met. These criteria include commitments and responsibilities pertaining to post closure monitoring and management of potential liabilities at the site. Security will be sought in the form of Cash or Bank Guarantee.
aa7-013-security-calculation-advisory-note.docx