THE MINE EXPANSION

On May 1, 2009, BHP Billiton released a Draft Environmental Impact Statement (EIS) promoting its plans to turn the Olympic Dam (Roxby Downs) mine in South Australia into the largest uranium mine in the world.

Please make a submission on the draft EIS before the Aug 7 2009 deadline - information posted at www.foe.org.au/anti-nuclear/issues/take-action/odmeis

The Olympic Dam uranium deposit is by far the largest on earth. Although the uranium is low-grade, the volume is staggering, amounting to about 2.4 million tonnes (and counting) − 30% of the world's known conventional uranium reserves. That's enough uranium to fuel the world's fleet of 430 power reactors for 40 years.

The mine has been operating since the late 1980s using underground mining. BHP Billiton plans to supplement underground mining with open-cut mining − it plans to make Olympic Dam the largest open-cut mine in the world by digging a pit of about 14.4 cubic kms (4.1x3.5x1 kms). Export of uranium is expected to increase from an average of 4,500 tonnes per year to 19,000 tonnes per year. Copper production is expected to increase from 180,000 tonnes per year to 750,000 tonnes per year, and production of gold and silver is also expected to increase.

The plan would lock Australia in as the world's uranium quarry and fuel unresolved nuclear waste management problems and unacceptable WMD proliferation risks

BHP Billiton expects government approval in mid-2010 and will then make final decisions on the scope and timing of the expansion project. A company representative said on the day the EIS was released: "We still have a lot of work to do before we can tell you when this project may start and how much it may cost."

At the mine site (most information from the Draft EIS):

* The quantity of ore to be processed would increase from 12 million tonnes annually to 72 million tonnes.

* The existing smelter would be expanded and new concentrator and hydrometallurgical plants would be built to process the additional ore, and generate additional concentrate for transport.

* It would take about five years of mining to remove the layer of overburden and expose the first section of the ore body. During this time, about 410 million tonnes per annum of material would be removed from the open pit. Over 40 years, the footprint of the pit would grow to be 14.4 sq kms. The overburden would be used for a 'Rock Storage Facility'.

* On-site production of refined copper would increase to 350,000 tonnes annually (about twice the current output).

* About 1.6 million tonnes of concentrate would be exported to China annually for further processing, yielding about 400,000 tonnes of refined copper along with several thousand tonnes of uranium and some gold and silver.

New or upgraded infrastructure to support the mine would include (most information from the Draft EIS):

* A 280 megalitre per day (ML/d) coastal desalination plant at Point Lowly on the Upper Spencer Gulf (to supply 200 ML/d of additional water via a 320 km pipeline connection to Olympic Dam and with the potential to supply 80 ML/d elsewhere).

* Either a new 270 km electricity transmission line from Port Augusta to Olympic Dam, and/or a gas pipeline from Moomba and a new gas-fired power station at Olympic Dam.

* A 105 km rail line to connect Olympic Dam to the national rail network near Pimba.

* A new airport to replace the existing airport at Olympic Dam.

* A landing facility on the Upper Spencer Gulf to unload equipment from barges, and an access corridor to a pre-assembly yard on the north-western outskirts of Port Augusta.

* Additional port facilities in SA at Outer Harbor and in the Northern Territory at the Port of Darwin to import supplies and export product

* A new accommodation village for workers.

* Expansion of the Roxby Downs township.

Waste and Weapons

Uranium production at Olympic Dam is expected to increase to 19,000 tonnes per year, sufficient to fuel 95 power reactors which will produce 2,850 tonnes of high-level nuclear waste per year (in the form of spent nuclear fuel). That amount of spent fuel contains 28.5 tonnes of plutonium − enough for 2,850 nuclear weapons each year. Over the lifespan of the mine, it could be responsible for the production of enough plutonium for over 340,000 nuclear weapons. If 99.9% of that plutonium is adequately safeguarded, the remaining 0.1% would suffice to build 340 plutonium bombs similar to the one that destroyed Nagasaki in 1945.

This is all the more troubling given the flaws and limitations of the international nuclear 'safeguards' system. A BHP Billiton EIS 'infosheet' states that safeguards arrangements "ensure that Australian uranium is used exclusively for peaceful purposes" and is "accounted for in full". In fact, safeguards fall far short of "ensuring" peaceful use of uranium exports and Australia's uranium exports are not fully accounted for - there are routine accounting discrepancies (known as Material Unaccounted For). International Atomic Energy Agency Director-General Dr. Mohamed El Baradei has acknowledged that the IAEA's rights of inspection are "fairly limited", that the safeguards system is subject to "vulnerabilities" and "clearly needs reinforcement", that efforts to improve the system have been "half-hearted" and it operates on a "shoestring budget ... comparable to a local police department." (More information on safeguards <www.foe.org.au/anti-nuclear/issues/oz/u/safeguards>.)

BHP Billiton sells uranium to nuclear weapons states, states refusing to ratify the Comprehensive Test Ban Treaty, states blocking progress on a Fissile Material Cut-Off Treaty, states with a history of secret nuclear weapons research, and states stockpiling 'civil' plutonium.

A new low was set in 2006 when the federal government, with BHP Billiton's support, negotiated a uranium export agreement with the secretive, repressive, militaristic, undemocratic regime in China. The Olympic Dam expansion is heavily dependent on the export of concentrate to China, leaving over one million tonnes of long-lived radioactive wastes each year for China to manage into the future. BHP Billiton intends to transport this radioactive concentrate by train through central Australia and out through the Port of Darwin. Communities and environments will be placed at risk by these hazardous bulk cargoes from Alice Springs to Darwin and across China − and none of these communities will be given a right to refuse these risks.

Dean Dalla Valle, head of BHP Billiton's uranium division, said on May 1: "Exporting uranium to new customers like China will be an integral part of creating value from the Olympic Dam ore body. We can do this with confidence because China is subject to the same strict safeguards arrangements as all of our other customers."

http://in.reuters.com/article/rbssIndustryMaterialsUtilitiesNews/idINSYD46211820090501?sp=true 

However, China is not subject to the same safeguards arrangements as all other customers. As one of the 'declared' nuclear weapons states, China's safeguards are voluntary. Assoc. Prof. Tilman Ruff noted in a 2007 paper that of the 44 proliferation-sensitive nuclear facilities in China, only 10 facilities were eligible for IAEA safeguards, only three had actually been inspected, and only one had a full suite of IAEA safeguards arrangements in place (Briefing Paper #19 at <www.energyscience.org.au>).

Australia should not sell uranium to any nuclear weapon state and must not turn a blind eye to their failure to comply with their nuclear disarmament obligations under the Nuclear Non-Proliferation Treaty, or to Russia’s illegal threat to use nuclear weapons against Poland in 2008 over US missile defence plans, or to China’s continuing practice of cultural genocide in Tibet and other human rights violations. An October 2008 Newspoll found that two-thirds of Australians oppose uranium exports to countries with nuclear weapons (73% of women and 51% of men).

The Draft EIS predicts global uranium mine production to double to about 92,000 tonnes of uranium oxide annually by 2030. The estimate is very optimistic. For a more realistic appraisal of the trajectory of nuclear power, see Schneider's analysis in the Bulletin of the Atomic Scientists:

http://www.thebulletin.org/web-edition/reports/2008-world-nuclear-industry-status-report/2008-world-nuclear-industry-status-rep

Radioactive Tailings

Under the mine expansion plan, the production of radioactive tailings, stored above ground, will increase six-fold to 58 million tonnes annually. The current tailings stockpile amounts to 100 million tonnes. BHP Billiton plans up to nine tailings dams in addition to the four that currently receive approximately 10 million tonnes of tailings annually, with their height increasing from the current 30m to 65m. The existing operation consists of 400 ha of tailings dams and 133 ha of evaporation ponds.

The tailings contain a toxic, acidic soup of radionuclides and heavy metals. There have been numerous spills and leaks – most significantly in 1994, when it was revealed that about three billion litres had seeped from the tailings dams over two years.

Mining consultants Advanced Geomechanics noted in a 2004 report that radioactive slurry was deposited "partially off" a lined area of a storage pond at Olympic Dam, contributing to greater seepage and rising ground water levels; that there is no agreed, accurate formula to determine the rate of evaporation of tailings and how much leaks into the ground; and that cells within a tailings pond covered an area more than three times greater than recommended, requiring "urgent remedial measures".

The problems have not been resolved. Photos taken by an Olympic Dam mine worker in December 2008 show radioactive tailings liquid leaking from the rock 'armoury' of the tailings 'retention' system. The leaks were ongoing for at least eight months and probably amounted to several million litres, but were not publicly reported by BHP Billiton or the SA government. BHP Billiton said that mine workers taking and releasing photos of the mine would be subject to "disciplinary action".

Managing the current tailings stockpile is challenging enough and there is every reason to be concerned about BHP Billiton's capacity to manage a six-fold increase.

Large numbers of bird deaths have been recorded in the vicinity of the evaporation ponds − over 100 deaths in one four-day period in 2004. BHP Billiton says "several measures used to deter fauna from visiting the Tailings Storage Facility over the past decade have met with varying degrees of success, but none have resolved the issue."

BHP Billiton likes euphemisms. 'Tailings retention facilities' retain some but not all tailings. The tailings dams have a 'rock armoury' - which leaks. Tailings dams are 'storage facilities' - as if to suggest that BHP Billiton has some plan for the waste other than leaving it where it is in perpetuity. BHP Billiton's plans for Olympic Dam compare unfavourably with the Ranger uranium mine in the NT, where tailings are required to be returned to the pit at the end of the mine's life and steps taken to ensure the tailings do not have a detrimental impact on the environment for at least 10,000 years.

(BHP to 'dump mine tailings on ground', Gavin Lower, May 01, 2009, The Australian, <www.theaustralian.news.com.au/story/0,25197,25411908-5013404,00.html>)

Nuclear power advocates like to compare the relatively small volume of waste produced by nuclear plants to the huge volume of waste produced by coal plants. However, to produce enough uranium to operate just one power reactor for just one year, Olympic Dam will produce 611,000 tonnes of radioactive tailings waste (58MT/95).

The Draft EIS states: "An estimated 12 cubic metres of low-level radioactive waste is  produced at Olympic Dam annually in the form of personal  protective equipment, laboratory equipment, and geological  and processing sample wastes generated following analysis  for radionuclides, but is not returned to the processing circuit.  This would increase to 48 cubic metres annually on completion  of the expanded project. After a review of disposal options and government approval in  2006, low-level radioactive waste has been packaged and  disposed of within the TSF [Tailings Storage Facility]. Inventories of the waste and its  disposal locations are recorded so that it can be managed in the  event of future disturbance if the tailings were to be  reprocessed. This disposal practice would continue for the  expanded project."

Water Consumption

BHP Billiton proposes an increase in water consumption from 37 million litres daily (from the Great Artesian Basin) to over 250 million litres daily (up to 42 million litres from the Great Artesian Basin, plus 200 million litres or more from a proposed desalination plant).

That total of 250 million litres equates to over 170,000 litres per minute ... every minute of every day in the driest state in the driest inhabited continent.

The water take from the Great Artesian Basin has had adverse impacts on precious Mound Springs − unique habitats which support rare and delicate micro flora and fauna, some species of which are unique to a particular Spring. While there is no current plan to increase the rate of water usage from the Great Artesian Basin, nor is there any intention to reduce it.

BHP Billiton's Draft EIS says the company assessed and rejected the option of a third wellfield in the Great Artesian Basin: "The two existing wellfields supplying the current operation could not sustain the additional demand. It would have been necessary to establish a third wellfield much further into the GAB to ensure the GAB springs were protected. The resulting production of much warmer water would have been technically difficult and very expensive to cool to the required temperature and pipe to Olympic Dam."

BHP Billiton pays nothing for its massive water take for the Olympic Dam mine despite recording a $17.7 billion profit in 2007-08. That arrangement is enshrined in the Roxby Downs Indenture Act 1982 − as anachronistic a piece of legislation as you're ever likely to see. (BHP Billiton also has its hand out for more corporate welfare with an ask for around $120 million of public subsidies in the form of diesel fuel rebates over the four year open-pit construction period.)

In February 2007, then Prime Minister John Howard wrote to state Premiers seeking their agreement "to establish proper entitlements, metering, pricing and reporting arrangements for water extracted from the Great Artesian Basin." Asked whether his proposed new arrangements would apply to Olympic Dam, Mr Howard said: "Everybody's got to make a contribution to solving this problem." But within days, he voiced support for BHP Billiton's "right" to free water from the Artesian Basin. In other words, everyone except BHP Billiton has to make a contribution to solving this problem.

As The Advertiser noted in a November 2005 Editorial, it is “essential … to safeguard the artesian basin water supplies”. To that end, most users are subject to the Great Artesian Basin Management Plan. But BHP Billiton is a law unto itself − its Olympic Dam mine is not subject to the Management Plan and also enjoys exemptions from the SA Natural Resources Act 2004 and the Environment Protection Act 1993.

BHP Billiton has a bore-capping program which, the company claims, saves more water than the mine currently uses. But water extraction for the mine is localised and the adverse impacts are all too apparent to people who have monitored the Mound Springs over the past 20 years. Likewise, the company's bore capping program is small comfort to pastoralists who suffer reduced water flow from the localised effects of water extraction for the mine.

The proposed desalination plant has raised concerns over its impacts on marine species and fishing industries – in particular from the discharge of brine. The Upper Spencer Gulf is a low flushing fragile marine environment unsuited to siting a desalination plant and BHP Billiton’s preferred site at Point Lowly is the breeding ground of the Charismatic Giant Australian Cuttle Fish.

David Noonan from the Australian Conservation Foundation said: "This is the worst possible place to build an internationally-sized desalination plant. The Gulf is shallow, low-flushing. It’s the breeding ground of the giant cuttlefish which is extremely sensitive to changes in salinity. The plant should be built on the ocean, not the gulf. We could build a reverse osmosis plant at Elliston on Eyre Peninsula’s west coast. Elliston has the ocean flushing that Pt Lowly lacks and enormous potential for year-round wind energy. Taxpayers are paying 20 per cent of the desalination plant’s capital cost and we should also have a big say on where it goes. It’s not good enough to leave it up to BHP.”

Adelaide University marine biologist Assoc. Prof. Bronwyn Gilanders says the sea around Whyalla is actually the world’s largest cuttlefish breeding zone, and that the plant could wipe them out: "Squids and Cuttlefish are generally short-lived. So they live a year; they breed only once. So if you damage the eggs or affect their reproductive ability then potentially that will have devastating consequences on the population.”

http://www.independentweekly.com.au/news/local/news/general/olympic-dam-eis-impact-of-the-worlds-biggest-mine/1501992.aspx?storypage=0

Electricity Demand

BHP Billiton expects the mine's electricity consumption to increase over six-fold from 125 MW to 775 MW, to be sourced from some combination of supply from:

* the SA electricity grid (and the national electricity market) with a new electricity transmission line from Port Augusta.

* a proposed gas-fired on-site 600 MW plant with a pipe from Moomba.

* a proposed co-generation plant using industrial waste heat generated from the burning of sulphur to produce the sulphuric acid required for the new hydrometallurgical plant. This waste heat could be used to generate up to 250 MW.

The Draft EIS says a study is ongoing into the feasibility of a 150 MW concentrated solar thermal plant. Geothermal power is described as an "opportunity for the future".

The proposed desalination plant would require 35 MW of electricity, which would be supplied by a new 25 km  transmission line from the Cultana substation. The Draft EIS says the electricity would be supplied by renewable energy sourced from the National Electricity Market.

Mark Parnell from the SA Greens is advocating a 500 MW solar thermal plant for the mine:

"Large scale solar thermal is the ideal power solution for the expansion project. Solar thermal electricity is a different technology to solar photovoltaics (PVs). A PV system converts sunshine into electricity, whereas solar thermal converts sunshine to heat. This heat is then transferred to a fluid, which drives a turbine to generate electricity. A big advantage of solar thermal electricity is that the heat energy can be stored, potentially allowing electricity to be generated when the sun goes down.

“Solar thermal technology is available now, with 500MW plants currently planned for California and Nevada, where the technology has been road-tested for 20 years. Australia’s biggest engineering firm, WorleyParsons said last year it wants to build 34 large-scale solar thermal power stations in Australia by 2020. The Roxby expansion is the ideal project to kick-start this plan – the Olympic Dam mine needs huge amounts of power, in a spot that’s well away from the grid and bakes in the sun all year round.

“Investing in cutting edge renewable technology will provide a huge smart job boost for South Australia, placing our state at the centre of a new growth industry. The Rann Government must insist BHP Billiton’s enormous appetite for electricity is sated from the sun, not dirty fossil fuels. Otherwise, we’ll be left struggling with old technology and old thinking as the Roxby expansion sends our State’s greenhouse pollution levels sky high.”

Greenhouse Emissions

Greenhouse emissions from the mine (and associated infrastructure) are projected to increase from 900,000 tonnes annually to 4.7 million tonnes, making it all but impossible for South Australia to reach its legislated target of 13 million tonnes. A technical assessment by Monash University engineering lecturer Dr Gavin Mudd estimates emissions would reach 4.5 to 6.6 million tonnes annually — one-third to one-half of the target of 13 million tonnes. (The technical assessment is posted at: <www.foe.org.au/anti-nuclear/issues/oz/u/roxby>.)

BHP Billiton likes to promote uranium as a fuel for low-carbon nuclear power - but that argument only holds if the comparison is with fossil fuels. According to the 2006 Switkowski report, nuclear power is three times more greenhouse intensive than wind power. Moreover, BHP Billiton wants to take credit for the alleged greenhouse benefits of its uranium exports but not for the WMD proliferation risks or the high-level nuclear waste legacy. Nor does BHP Billiton take any responsibility for the greenhouse emissions arising from the use of its extensive fossil fuel exports.

Dr Mudd said: "South Australia has a legislated greenhouse target to reduce emissions by 60%, limiting total emissions to about 12 million tonnes of carbon dioxide annually by 2050. Yet Olympic Dam alone will produce 4.5-6.6 million tonnes annually, making it virtually impossible for South Australia to meet its legislated target. BHP Billiton likes to take credit for its export of uranium to fuel low-carbon nuclear reactors, but that argument is flawed on two counts. Firstly, the end uses of energy exports are not counted in Australia's greenhouse emissions, and if they were, BHP Billiton would also need to account for its extensive fossil fuel exports. Secondly, the argument rests on the arbitrary and implausible assumption that the only alternative to Olympic Dam uranium exports is to build coal fired power plants."

Radioactive Racism

Racism in the uranium mining industry in Australia typically involves ignoring the concerns of Traditional Owners insofar as the legal and political circumstances permit; divide-and-rule tactics; bribery; humbugging Traditional Owners – exerting persistent, unwanted pressure until the mining company gets what it wants; providing Traditional Owners with false or misleading information; and threats, most commonly legal threats.

BHP Billiton claims that it consults with Traditional Owners such as the Kokatha and Arabunna. But consultation is hardly the word since the company is under no obligation to take the slightest bit of notice of their views. The mine operates under the Roxby Downs Indenture Act, which provides overrides and exemptions from the SA Aboriginal Heritage Act 1988. The latter is the key law aimed at protecting Indigenous heritage in South Australia. However, under the Indenture Act, BHP Billiton is in a legal position to determine what consultation occurs with Traditional Owners, who is consulted, and nature of any consultation. The company decides the level of protection that Aboriginal heritage sites receive and which sites are recognised. The company claims that it fully complies with Aboriginal heritage legislation even though it is not required to do so – if so, why is the company unwilling to relinquish the legal exemptions it enjoys?

It is ironic that BHP Billiton supports Reconciliation Australia's 'good governance' program and has provided over $2 million to Reconciliation Australia, yet will not relinquish its exemptions from the Aboriginal Heritage Act. The company's attitude appears to be 'do as I say, not as I do'.

One particularly notorious incident in the history of the Olympic Dam mine concerned the laying of a water pipeline on the land of Arabunna Traditional Owners in the mid-1990s, when WMC Resources owned the mine. The dispute over the pipeline led to violence, terrorism, imprisonment, and the death of one person. Jan Whyte and Ila Marks summarised the controversy in the July 1996 edition of the Friends of the Earth magazine, Chain Reaction: "It appears that WMC has embarked on a course of side-stepping consultation with the Arabunna as the traditional custodians. It has also taken similar actions in regard to the Kokatha, the traditional custodians for the actual mine site. One method used by mining companies to side-step proper consultation processes is documented in North America and Canada as well as Australia. Mining companies incorporate small Aboriginal groups in areas under dispute and give them financial support. These groups are then regarded as the official representatives for that area and mining companies proceed to consult with them. Thus, it seems as if the companies are going through the correct legal processes whereas, in fact, they are ignoring parties who have legitimate interests." (See the full article and also the ABC 'Background Briefing' transcript at <www.foe.org.au/anti-nuclear/issues/oz/u/roxby>.)

Of course, BHP Billiton cannot be held responsible for the actions of WMC Resources over a decade ago. But it seems that little has changed, including BHP Billiton's refusal to relinquish the overrides and exemptions it enjoys from the Aboriginal Heritage Act.

The Roxby Downs Indenture Act

The proposed expansion of the mine ought to be subject to legislative and regulatory controls and standards at least as rigorous as those that apply to smaller projects. To apply considerably weaker standards is indefensible. Yet the Roxby Downs (Indenture Ratification) Act 1982 provides BHP Billiton the legal authority to override important state legislation including the Aboriginal Heritage Act 1988; Environmental Protection Act 1993; Freedom of Information Act 1991; Natural Resources Act 2004 (incorporating water management issues); Development Act 1993; and the Mining Act 1971.

An indication of the sweeping nature of the legal privileges is the statement in the Indenture Act that:

"(1) The law of the State is so far modified as is necessary to give full effect to the Indenture and the provisions of any law of the State shall accordingly be construed subject to the modifications that take effect under this Act.

(2) Without limiting the generality of subsection (1), in the case of any inconsistency between the provisions of any Act or law and of the Indenture, the provisions of the Indenture shall prevail ..."

The Indenture Act is currently the subject of secret negotiations between the SA government and BHP Billiton and is expected to be modified in the first half of 2010 to accommodate the mine expansion plans. The SA Labor government has refused to commit to repeal the legal privileges although they are clearly inconsistent with the government's policy of applying the "strictest environmental standards" to uranium mining.

SA Premier Mike Rann said on the day of the release of the Draft EIS: "It [the mine expansion] has got massive benefits for South Australia but I will insist that world's best practice in terms of environment is complied with."

http://news.theage.com.au/breaking-news-national/olympic-dam-environment-impact-presented-20090501-aq24.html

If Mr Rann was serious, he would immediately announce that the indefensible clauses in the Indenture Act will be promptly repealed.

Nor has there been any indication from BHP Billiton that it will relinquish the privileges although they are inconsistent with the company's policy of meeting "internationally recognised standards". Olympic Dam does not have to comply with South Australian standards let alone international standards. BHP Billiton Chairman Don Argus said in November 2006 that "we will apply the highest standards ... we are acting within the law." However, Olympic Dam does not operate within the law that applies everywhere else in SA.

Under confidentiality clause 35 of the Indenture Act, BHP Billiton has veto power over public release of information relating to activities undertaken within the 1.5 million hectares covered by the Indenture Act, and related matters such as government/company negotiations. Monash University environmental engineer Dr Gavin Mudd notes that: "until the Indenture Act is revoked entirely there can be no truly independent, external environmental assessment of the impacts of Olympic Dam."

The Draft EIS (ch.6) says that the Indenture Act "ensures the continuation ... of a safe and environmentally acceptable operation". It does nothing of the sort.

More information

Friends of the Earth <www.foe.org.au/anti-nuclear/issues/oz/u/roxby>.

Dr Gavin Mudd's articles on Mound Springs, Great Artesian Basin etc <http://civil.eng.monash.edu.au/about/staff/muddpersonal>

ACF <www.acfonline.org.au/articles/news.asp?news_id=2324>

Sustainable Energy and Anti-Uranium Service <www.sea-us.org.au/roxby/roxby.html>

FoE Adelaide <www.adelaide.foe.org.au>