Taseko takes a second swing at New Prosperity
VANCOUVER — Nearly two years after its initial environmental impact statement (EIS) was rejected, Vancouver-based Taseko Mines (TKO-T, TGB-X) is stepping up to the plate for a second attempt at permitting its US$1.1-billion New Prosperity copper-gold project 120 km southwest of Williams Lake, B.C.
Taseko has run into staunch opposition from First Nation and environmental groups during its bid to put New Prosperity into production. And though Canada’s hybrid provincial-federal environmental review process is undergoing an overhaul under Prime Minister Stephen Harper, Taseko’s current review will fall under existing legislation — effectively forcing the company to receive approval under the same rules that rejected it two years ago.
The heart of the debate revolves around Fish Lake, a site that holds spiritual significance to the Tsilhqot'in First Nation and houses a large amount of rainbow trout. Taseko had originally planned to drain the lake and use it as a tailings facility. Though the B.C. provincial government approved the project, Taseko was later denied by the federal government, which invited the company to re-submit its proposal after addressing a number of environmental concerns.
Taseko announced on Sept. 20 that it had "formally submitted" a revamped environmental impact statement for New Prosperity to a three-member review panel. The crux of the revisions is a US$300-million plan to salvage Fish Lake by moving New Prosperity's tailings facility roughly 2 km upstream.
According to a report on Taseko's website the company will work with the watershed's drainage system in order to eliminate tailings seepage into the lake, with the constructed tailings pond and open pit effectively acting as barriers against water flow. New Prosperity's open pit would reach a diameter of 1.6 km and come within roughly 500 metres of Fish Lake.
"We are confident that the New Prosperity [environmental assessment] represents a mine development plan that delivers considerable economic value to Canadians,” stated president and CEO Russell Hallbauer. “While employing proven industry-leading engineering and environmental management techniques for which the British Columbia mining industry has become world-renowned.”
Hallabauer referenced Taseko's willingness to spending an additional US$300 million on the project to ensure the preservation of Fish Lake as an indication of the company's commitment to responsible development.
The debate has expanded to include questions surrounding the jurisdiction of the environmental review panel. Taseko has moved to eliminate any commentary surrounding First Nation spiritual and hereditary rights, stating the sole purpose of the review is to determine the environmental impact of the project.
Adding further uncertainty to the issue is a July 6 letter from Canadian Environmental Assessment Agency (CEAA) Director Lisa Wells. Taseko submitted a draft of its updated environmental report on June 8, and the CEAA's letter outlines a series of problems with the original draft that required amendment before an official application was submitted.
According to the text of the letter, "reviewers identified sections in the draft [environmental impact statement] where information specified in [guidelines] is missing, presented in insufficient detail to enable determination of the potential environmental effects of the project, and/or presented using methodologies that would also preclude such a determination."
CEAA forwarded roughly 40 pages of revisions to Taseko, though content pertaining to the watershed and tailings facility falls under section 2.2.3 of the EIS. The majority of the CEAA's concerns seemingly relate to a lack of detail regarding planning and potential impact on the water system, which could feasibly have been remedied in the four months since the draft was submitted.
“The government has sent us back their comments,” commented Hallabauer during his second quarter conference call on Aug. 9. “We believe that this will be a process that will be not a federal process but will be completely covered by the provincial government in terms of the provincial environmental assessment process. The project at this juncture is meeting our expectations and if all goes according to plans, I would expect we would be in the position to make a development decision sometime in mid-2013.”
Taseko's shares have jumped 21% or 58¢ since early August. Though there has been speculation that Taseko may fare better under the Harper government's single-level provincial review proposal, the water gets a touch murkier considering it is looking likely that B.C. may be under the reign of the often anti-mining New Democratic Party by the time a third review period rolls around.
First Nation groups have also expressed concerns that federal Environment Minister Peter Kent may overrule any findings from the panel, and simply approve Taseko's project due to its compelling national economic benefits.
Company shares have dropped 4% or 13¢ since Taseko announced it had submitted its revised environmental plan on Sept. 21. The company closed today at $3.15.