What is expected of WCL (and other Mining Companies) While Closing Mines?
Vidarbha has the highest number of coal mines in Maharashtra and there are several that are being proposed for future. As such we see that there is much discussion, reporting and even controversy that surrounds proposed mines. Public hearings are organized to allow those who are directly impacted by the proposed mines as also the public at large to share their concerns and raise objections. However, there is absolutely no public discussion about what happens once the mine is exhausted or becomes inoperative due to any other reason. In other words, we are far more concerned about the future impact of a proposed mine, but are silent about the impact on environment and society after the mines are closed. There are several reasons for this – firstly, the public is not aware about the policies and regulations around mine closure and secondly, the mining companies (or mine owners) do not provide any forum for public participation in the mine closing stage.
It is in this context that we can try to understand the statutory and policy provisions around mine closure because public should be aware of what is to be expected from WCL and other mining companies, not only when they propose mines but also when mines are closed or abandoned.
Statutory Provisions
Section 5(2) (b) of Mines & Minerals (Development & Regulation) Act, 1957 states that an application for grant of mining lease should be accompanied by a mining plan duly approved by the Central Government or the State Government. Such a mining plan includes the plan for mine closure called Mine Closure Plan (MCP). As per the guidelines of Ministry of Coal issued on 29th May 2020, the Mine Closure Plan is an integral part of the Mining Plan. In October 2022, the Ministry of coal issued important guidelines for coal mines that were discontinued/abandoned/closed before 2009. Thus, as of today there are guidelines regarding mine closure which cover all coal mines in India.
The implementation of the approved MCP is the sole responsibility of the mine owner.
The key objectives of Mine Closure Plan are as follows:
- a) To allow a productive and sustainable after-use of the site, which is acceptable to the mine owner and the regulatory authority.
- b) To protect public health and safety.
- c) To alleviate or eliminate environmental damage and thereby encourage environmental sustainability.
- d) To minimise adverse socio-economic impacts.
Mine Closure Guidelines
The Ministry of Coal, Government of India issued Mine Closure Guidelines for the first time in August 2009, thereafter amended a number of times. As per the guidelines of January 2013, all coal mine owners have to include Mine Closure Plans in the Project Report/Mining Plan for each of their mines and get it approved by the competent authority constituted by the Coal Ministry.
Components of Mine Closure Plan
MCPs have two components (i) Progressive or concurrent mine closure plan which includes various land use activities to be done continuously and sequentially during the entire period of the mining operations. In other words, Mine Closure is part of the overall mining activity and the coal company has to consider this right from day one.
(ii)Final mine closure plan which includes activities that state towards the end of mine life, and may continue even after the reserves area exhausted and/or mining is discontinued till the mining area is restored to an acceptable level. The guidelines provide details of activities that are to be completed by the mine owner at various stages.
Where does the money come from for Mine Closure? – Escrow Accounts
The money to be provided per hectare of total Project Area for the purpose of mine closure is to be deposited every year after commencement of any activity on the land for the mine after opening a Fixed Deposit Escrow Account prior to obtaining mine opening permission from Coal Controller. Mining company or mine owners including PSUs have to deposit a yearly amount in a scheduled bank. If the mine owners fail to deposit the annual amount required to be deposited, the government can withdraw the mining permission.
The guideline issued in 2009 estimated that it would take aroundRs.6 lakhs per hectare of the total protect area and Rs.1 lakh per hectare for underground project area. The annual closure cost is to be computed considering the total project area at the above mentioned rated and divided by the entre life of the mine in years. An amount equal to the annual cost is to be deposited each year throughout the mine life compounded @5% annually. This amount is to be deposited in the Escrow account with the Coal Controller Organisation as the exclusive beneficiary.
According to the guidelines, mining is to be carried out in a phased manner. Afforestation or reclamation work in the mined out area has to be initiated while commencing mining activities from one phase to the other. Up to 80% of the total deposited amounted in the escrow account may be released after every five years and the amount released should be equal to the expenditure incurred on the progressive mine closure in last five years or 80% whichever is less. The balance mount is released to the mine owner at the end of the final mine closure.
An Escrow Account means that the funds are retained in the account till the conditions are met. In other words, if the Mine Owner does not fulfil the conditions of mine closure given in the guidelines, they forfeit the funds in the escrow account.
Some Important Provisions of Mine Closure Guidelines: The guidelines issued by the Coal Ministry include the following provisions which all mining companies have to follow:
Progressive mine closure plan should be prepared for every five years form the beginning of the mining operations. These plans are examined every five years by monitoring agencies appointed by the Government. This means that mine closing is not a one-time activity to be taken up at the end of the life of a particular mine; rather it is a continuous activity which has to be monitored by statutory agencies every five years. This is an important provision because if this provision is properly carried out, then there should not be OB dumps even in the case of operative mines. At least every five years, the mined out land should be progressively closed and the area should be reclaimed.
Water Quality Management – measures have to be taken for protection of water bodies including control of erosion, sedimentation, siltation, water treatment, diversion of water courses, measures for protection of contamination of ground water from leaching etc.
Waste management – the waste material i.e. overburden should either be used or these should be ‘stabilized’. The mine owners have to ensure protective measures for prevention of siltation, erosion and dust generation. The guideline is clear that reclamation and afforestation shall proceed concurrently with the mine activity. All efforts should be made and reflected to keep land requirement bare minimum for external over burden dumping to minimize land degradation.
Economic repercussions of closure of mine – at present the guidelines are mainly concerned with the impact on the people who are directly employed in mining or in ‘satellite occupations’. The guidelines are not clear regarding the social responsibilities of the mine owner in respect of economic impact of mine closure on local communities. There are five points in the Guidelines of 2009, none of which give any concrete road-map for the future rehabilitation or compensation of mine workers and their families, leave alone other sections of society.
The guidelines provide for the following five aspects with regard to socio-economic repercussions of mine closure:
(1) The mine closure plan has to report on the scope of local residents employed in the mine and their scope of joining family occupation once again after closure of mines. This is a completely absurd provision because most local residents in mining areas are farmers whose land is taken over for mining purposes. Therefore the question of their returning to ‘family occupation’ is difficult unless the mine owner reclaim the land and hand it over back to them in a condition that makes agriculture possible.
(2) Compensation given or to be given to the employees concerning their sustenance and their family members.
(3) Satellite occupations connected to the mining industry and continuance of such business after mine closure. – the guideline does not define what is meant by ‘satellite occupations’ and therefore the future of such business is also not discussed. We may take for example a canteen catering mainly to miners as a satellite business. Once the mine closes and the miners move away, this business will naturally close down. It is not clear from the guidelines, whether or to what extent the mine owner has any responsibility towards this business.
(4) Continued engagement of employees. – although the term ‘employee’ is not defined, it may construe to mean only the permanent employees because the mine owners may be reluctant to take any responsibility for contract labourers.
(5) Envisaged expectation of the society on closure of mine – this is the provision in the guidelines which is least taken care of. Neither the local community nor the society at large is asked to discuss their expectations with regard to closure of mines.
Conclusions
- The general public, especially communities who are directly impacted by coal mining as well as those whose livelihoods are dependent on mining should be aware of Mine Closure Plans.
- The Mining Companies should take steps to widely publicize their Mine Closure Plans with the public and ensure that the ‘expectations of the society’ are at least expressed if not met.
- The Mining companies should share the details of the physical progress of Mine Closures with the media and the public.
- The guidelines should be more specific about the responsibilities of the mine owners regarding the socio-economic repercussions of mine closure to include permanent workers, contract workers and the repercussions on the larger community where the mine is located.
- The ground level progress on the environmental aspects of mine closure such as removal of overburdens, water management and land reclamation activities and/or afforestation etc. should also be shared with the public and media.
- Public hearings should be mandatory regarding the progress on Mine Closure and before the Final Mine Closure.
- The Coal Controller should not certify the Final Mine Closure without a public hearing being conducted on this issue.
