The world’s largest mining company BHP has betrayed international efforts to reform the mining sectors’ ongoing potential to cause catastrophic impacts though the failure of tailings dams.

Operations at the Olympic Dam copper-uranium mine in South Australia show BHP has failed to learn key lesson’s regarding transparency, accountability and corporate responsibility following its complicity in the November 2015 disaster at the BHP and Vale joint venture Samarco iron ore mine in Brazil.

Samarco was a corporate mining disaster which caused the loss of 19 lives and catastrophic environmental impacts with permanent pollution of native people’s land and rivers. Brazilian prosecutors say the company failed to take actions that could have prevented the disaster.

Mine

BHP now faces a $6.3 billion (US dollars) law-suit in the UK on behalf of 200,000 Brazilian people. The case alleges the Anglo-Australian mining giant BHP was “woefully negligent” in the run-up to the 2015 dam failure that led to Brazil’s worst environmental disaster.

Mayors of two towns wiped out by the Samarco disaster assert that BHP has been using delaying tactics to avoid paying compensation to thousands of people affected by the flood of tailings waste.

There have long been calls from environmentalists and others for Australian mining companies to be required to apply Australian standards to their overseas mining operations. The logic is sound given the often inadequate practices of Australian mining companies overseas.

But the logic is also a little shaky given that mining standards in Australia leave much room for improvement. Olympic Dam is a case in point.

BHP orchestrated approval in 2019 for a massive new tailings dam at Olympic Dam ‒ Tailings Storage Facility 6 (TSF6). This tailings dam is to be built in the same risky ‘upstream’ design that featured in both the Samarco disaster and the January 2019 Vale Brumadinho tailings dam disaster that killed over 250 people – mainly mine workers ‒ in Brazil.

Community 

An internal 2016 report reveals that TSF6 has the potential to cause the death of 100 or more BHP employees and to cause “irrecoverable” environmental impacts from release of tailings waste.

Yet, contrary to the recommendations of NGOs in Australia, Federal Environment Minister Sussan Ley granted approval for TSF6 without a comprehensive safety impact assessment and without setting any conditions on BHP to protect workers and the environment.

TSF6 is to cover an area of nearly three sq km in tailings waste up to a height of 30 metres at the centre of the tailings pile, equivalent to the height of a nine-story building. BHP will leave this toxic mine waste there forever.

Australian Prime Minister Scott Morrison has announced a “fast track” taskforce to further prioritise and accelerate approvals to BHP mining interests in a major Olympic Dam mine expansion process.

BHP has clearly failed to learn the lessons of the disasters in Brazil. TSF6 represents an untenable risk to the lives of BHP employees and is unfit for community safety expectations in the 2020’s. Such approaches are clearly inconsistent with modern environmental practice and community expectations.

Secret

Radioactive tailings waste at Olympic Dam poses a significant long-term risk to the environment and must be isolated for over 10,000 years ‒ effectively forever.

In response to the Samarco disaster in Brazil in late 2015, BHP conducted a safety review of all its tailings dams across the world.

As a result, the August 2016 internal ‘TSF Dam Break Study Report’ by consultants GHD warned of the ‘extreme’ consequence rating of all existing and proposed tailings dam waste storage facilities at the Olympic Dam mine.

The Dam Break Study Report concluded that more than 100 Olympic Dam workers are at risk of losing their lives in a catastrophic tailings dams embankment breach, “primarily as a result of the potential flow of tailings into the adjacent backfill quarry and entrance to the underground mine”.

In a major breach of transparency, the company kept these warnings secret for three years.

Process

The first public disclosure that a catastrophic failure of TSF6 could kill 100 or more BHP employees and permanently pollute the environment was not made until after BHP was granted federal and state approvals to construct and operate the TSF6 tailings dam in 2019.

The Church of England Pensions Board has led global civil society interventions following the Samarco and Brumadinho tailings dam disasters in Brazil.

A priority is the need for a new independent and publicly accessible international standard for tailings dams based upon the consequences of failure.

One initiative was convened by the International Council of Mining and Metals, the Principles for Responsible Investment and the United Nations Environment Programme.

Their Global Industry Standard on Tailings Management report was released in August 2020 but the process is yet to establish an independent global entity to oversee the implementation of this standard.

Loss

Given the urgency of the safety issues, a second Church of England intervention requested mining companies provide “detailed disclosure on tailings storage facilities”.

In response, the BHP Tailings Facilities Disclosure reported that Olympic Dam has three of the four ‘extreme’ consequence tailings dams in Australia, but failed to reveal that this crucial fact had been reported to BHP in August 2016 but had been kept from the public.

BHP also conducted an Environmental, Social, and Governance Briefing on tailings dams in Sydney in June 2019. This report states that the “principal potential impact” in a “most significant failure mode” is in “employee impacts” – with the potential loss of life of 100 BHP employees at Olympic Dam.

However, the global BHP Tailings Facilities Disclosure and the ESG Briefing report conspicuously failed to disclose that BHP was at that very time pushing ahead with approval of another risky upstream design extreme consequence tailings dam ‒ TSF6 at Olympic Dam.

BHP took over ownership of Olympic Dam in 2005. In 2011, BHP designed and constructed Tailings Storage Facility 5 (TSF5) with the design study claiming: “No potential loss of life”.

Upstream

Five years on, in 2016, all the existing tailings dams and the BHP-designed TSF5 were re-classified internally as ‘extreme’ consequence tailings dams, with potential for catastrophic tailings dam embankment breaches.

Was BHP incompetent or indifferent to safety in operating Olympic Dam for a decade without apparent knowledge of extreme risks?

Meanwhile, the amount of hazardous tailings waste at Olympic Dam continues to increase and now amounts to an estimated 180 million tonnes, increasing at around 8‒10 million tonnes each year.

A June 2020 report, ‘Safety First: Guidelines for Responsible Mine Tailings Management’, by Mining Watch Canada and Earthworks USA recommends the mining sector “ban upstream dams at new mines and close existing upstream facilities.”

Upstream construction design features periodic raising of the tailings dam embankment wall built back over existing tailings waste. The stability of the raised upstream embankment wall then depends on unreliable consolidation of tailings waste located under the raised dam wall.

Seismic

In contrast, the safer downstream construction method extends rises in the dam wall away from the tailings waste, building thicker sturdier embankment walls over firmer foundations.

Over 140 NGOs and technical experts have endorsed the report’s Safety First Guidelines and the ban on new upstream construction tailings dams.

A scorecard compares the Global Industry Standard on Tailings Management to the 16 Safety First Guidelines and concludes the Industry Standard will not stop mine disasters.

A fundamental safety critique of the Industry Standard is its failure to ban new upstream design tailings dams or to phase out existing hazardous upstream dams.

The Safety First report states: “Because of the demonstrated risk associated with upstream dam construction, upstream dams must not be built at any new facilities. Upstream construction is especially problematic in areas with moderate or high seismic risk… Construction of new upstream tailings dams has already been banned in Brazil, Chile, Peru, Ecuador.”

Stringent

In terms of accountability and BHP’s claimed ‘social license to operate’, the company should surrender outdated legal privileges from a 1982 Indenture Act at governs Olympic Dam mine.

This Indenture Act takes precedence over ‒ and severely limits the application of ‒ the South Australian Mining Act, the Aboriginal Heritage Act and near all other public interest legislation and due process.

A Productivity Commission Report on Resource Sector Regulation explains: “The Roxby Downs (Indenture Ratification) Act 1982 (SA) overrides any inconsistent provisions of other laws, such as licensing, environment, heritage, and freedom of information, in the area of the town and mine.

“Instead, BHP has the power to make decisions about this legislation independently (in consultation with the SA Government). This arrangement has been subject to some controversy since its introduction for the various privileges offered to the mine.”

A mining giant operating a giant mine … good reasons for BHP to be required to apply more stringent safety standards than other mines. Yet the opposite applies.

Indifference

The Kokatha people are traditional owners and Native Title holders of the region encompassing the Olympic Dam mine. Their rights and interests to protect their country and culture should be a paramount consideration.

Kokatha Traditional Owners should have a right to exercise Free, Prior and Informed Consent under the United Nations Declaration on the Rights of Indigenous Peoples regarding any BHP Olympic Dam proposal, without limitation by outdated BHP legal privileges and prior agreements.

Other traditional owners are also affected, including the Arabana people. BHP intends to increase extraction of underground water from Arabana land to 50 million litres per day, further adversely affecting precious Mound Springs that emerge from the Great Artesian Basin.

BHP’s practices at Olympic Dam are an affront to the company’s workers, to Traditional Owners and all South Australians, and to the victims of the Samarco disaster. BHP has failed the ‘safety first’ test. The company must stop putting profits ahead of worker safety, must stop construction of risky upstream tailings dams, and switch the design of TSF6 to a safer, downstream construction method.

BHP’s understanding of Environmental, Social, and Governance (ESG) criteria seems predicated on secrecy to prevent corporate accountability.  The company should fail an investor screen on ESG criteria. Among other problems, its failures contributed to the Samarco disaster, and its record at Olympic Dam is a one of incompetence, secrecy and indifference to worker safety.

This Author

Dr Jim Green is the national nuclear campaigner with Friends of the Earth Australia and editor of the Nuclear Monitor newsletter. David Noonan is an independent environment campaigner. Click here for further information on BHP’s Olympic Dam mine.