There’s no way to know yet just how the proposed Water Sustainability Act (WSA) will impact the mining industry. Though the proposal outline states there will, for the first time, be fees for the use of groundwater for the industry, those new fees have yet to be decided.
The Ministry of Mines explains if this new act becomes legislation, the mining industry will have to monitor groundwater use. “Regarding the volume of water used, there is currently no requirement to monitor and report groundwater. Under the current Water Act, surface water licensees may be required to monitor and report water use. This requirement is left at the discretion of the regional water manager, who, as part of the authorization, can require a licensee to monitor and report water use. This decision is based on water usage for a particular water source and how much water is available for use. Under the proposed Water Sustainability Act, large-volume users of both surface and ground water, such as industrial operations like many mining operations, would be required to measure, record and report their water use and related information,” states the ministry.
All surface and groundwater users that divert or extract more than 250 cubic meters (m3) per day would also be required to measure and report their water use.
The Ministry of Environment adds, “Except if the well is designed for a withdrawal rate equal to or greater than 75 litres per second. Currently, if this threshold is exceeded then an environmental assessment is required under the Reviewable Projects Regulation of BC’s Environmental Assessment Act. There are currently no water application fees or annual water rentals specific to groundwater withdrawals for the mining industry.”
The proposal, which has been in the works for years, has now closed for comments from stakeholders, such as the Mining Industry.
David Ewing, vice president environment & technical affairs for the Mining Association of BC (MABC) says, “The industry wants to protect the environment, while staying competitive,” he continues, “Essentially, it’s a proposal for the act. In advance of writing the legislation, the province felt the need to consult one more time. Something we support. We like the transparency. But one of the issues is the info does not contain the impact, the process, and the costs associated with it.”
The proposal explains, “The provincial government is contemplating changes to the structure and rates for water fees and rentals. It is likely that rates will be increased so as to help improve services to water users, better support sustainable water management, improve program cost recovery and enable implementation of the WSA.”
The proposed Water Sustainability Act is intended to update and replace the existing Water Act, responding to current and future pressures on water. The trouble is, with no data to go on when it comes to ground water use in industries such as mining, no one knows how the new fees and rental rates will impact the companies.
Since 2009, the BC government has received more than 2,250 written submissions from individual citizens, First Nations organizations and stakeholder groups. This is the third time government has invited British Columbians to comment on its proposals for a new WSA.
Changes to the current act include protecting stream health and aquatic environments; to consider water in land-use decisions; regulating and protecting groundwater; regulating water use during times of scarcity; improving security, water use efficiency and conservation; and measuring and reporting large scale water use.
The Ministry of Environment explains how the WSA will impact the mining, as well as the oil and gas industry, “Under the WSA, all non-domestic users of groundwater, including the mining sector, would be required to pay fees and rentals for groundwater. It is proposed that the structure and level of fees and rentals would be the same for surface water and groundwater. The specific costs to users will be dependent on the amount of water used and the purpose for which it is used.”
Currently, in addition to annual rental fees, new proposals for surface water use are typically subject to application fees, explains the ministry. The new WSA would also include application fees for both surface and groundwater use. Some of the current application fees relative to mining and oil and gas are: $500 annually for each purpose (mining equipment, oil field injection, placer mining, pressure testing and flushing) and $5,000 annually for each purpose (hydraulic mining, processing of ore, washing coal).
As noted, the new WSA proposes the mining and petroleum sectors will have an increase to the water fee and rental rates as ground water will now be included, but just now much is yet to be determined.
Mining and petroleum operations also pay water rentals. The current rates for mining and petroleum is $1.10 per million litres (1,000 m3) with a minimum annual rent per sector of $100. This is only for surface water, as ground water is yet to be regulated.
The Oil and Gas industry, as regulated by the Oil and Gas Commission (OGC) also pays a fee for a well permit. This costs $10,700 as the Fee, Levy and Security Regulation. Since 2007 52 active water source wells have been created, which gain operations access to ground water. In 2011 the average depth of a water well was 219 metres deep, with 74 percent of these wells being between 20 and 200 metres deep. In 2012, The Montney heritage basin (Tumbler Ridge is on the cusp) had 193 wells, which extracted about 0.5 million m3 of ground water from water source wells. The latest water use report from the OGC states about seven percent of water used for hydraulic fracturing comes from water source wells. However, in a community presentation to Tumbler Ridge on Oct. 19 2012, Allan Chapman, hydrologist for the OGC stated that for hydraulic fracturing, 10 percent of the water used is from shallow groundwater (less than 200 metres) and 10 percent is from deep ground water (more than 800 metres).
This is interesting because, the new WSA, states some deep ground water could be exempt from regulations of the act. The Ministry of Environment states, “Water use for hydraulic fracturing would require authorization under the WSA, regardless of whether the water comes from a surface or groundwater source. However, water from deep saline aquifers is proposed to be exempt from the requirement for authorization. Saline groundwater from these deep formations is not suitable for drinking water or irrigation, but may be a viable source of water for the oil and gas sector. Not regulating or charging for deep saline water provides an incentive, thereby taking pressure off the demand for the freshwater.”
The proposal states, “The WSA would include the authority to exempt deep, saline groundwater, and to set depth thresholds and salinity levels. Deep, saline aquifers would be expected to have minimal hydraulic connection with shallower groundwater.”
Saline water is salty and can contain naturally occurring hydrocarbons such as gas or petroleum. The WSA states, “[This is] Thought to reflect that deep, saline groundwater is disconnected from shallower ground and surface water. These deep formations would not be suitable for use as a water supply (drinking water, irrigation) however; saline groundwater might be a viable source of water for some commercial and industrial development. E.g. oil and gas production, recovery of oil and gas supplies, and thereby take pressure off the demand for the freshwater. Groundwater found under 600 metres, below the ground surface that contains either: 10,000 milligrams per litre (mg/L) total dissolved solids; or 4,000 mg/L total dissolved solids and contains amounts of hydrocarbons or hydrogen sulfide.”
The proposal also states companies will have to begin regulated monitoring of all water use. “It is proposed that the WSA would enable the development of a regulation requiring larger water users (e.g. 250 m3 or more per day) to measure, record and report actual water use and related information on a more comprehensive and consistent basis. This would support compliance verification with licensed water volumes and promote water use efficiency. Obtaining information about actual water use would help in assessing sustainability and in determining whether a Water Sustainability Plan may be warranted. It is proposed that a measuring and reporting regulation could, for example, identify who would be required to install and operate measuring or testing devices and report measurements of or test ground or surface water that is diverted, extracted, stored or used,” states the report.
The MABC is concerned about how the WSA will impact the companies, since the WSA does not provide any particulars when it comes to the impact, the process, and the costs. Ewing says, “The bulk of the burden lies on the industry to provide the information. And it’s dependent on the requirements in regards to the monitoring. Mining companies are interested in social licence, and they do value the environment. We would like this to roll out in terms of process and retain a competitive industry going forward.”
With many questions left to answer in regards to the impacts the WSA will have in terms of fees for the mining and oil and gas sectors, the Ministry of Environment explains the other implication could be regulation during times of scarcity, which could affect access to water and operations.
The MABC has also recently become the first provincial association to adopt the Mining Association of Canada’s Towards Sustainable Mining Initiative (TSM). In 2013, MABC launched a three-year plan to implement TSM. TSM is a protocol and a set of performance indicators that was developed in collaboration with communities of interest and key stakeholders in six areas of operational performance: tailings management, energy and greenhouse gas emissions management, Aboriginal and community outreach, crisis management planning, safety and health, and biodiversity conservation.
Ewing believes mining to already be one of the most regulated industries in Canada, and he supports the WSA. In regards to their input for the WSA, Ewing says, “We did provide comment over the phone last week and we will be following up with written comments as well.”
Another organization that has put in their comments is the Canadian Union of Public Employees (CUPE), they are in full support of having new legislation for water use by industry. BC CUPE President Mark Hancock says, “It is obvious this 100-year-old legislation needed to be modernized. We cannot miss this opportunity now to make sure the new WSA takes into account many future generations who will also depend on our vital water.”
CUPE believes the fees and rentals rates for industry need to be higher. Hancock says, “It is not enough to charge private water companies a mere 85 cents for every 1,000 cubic meters of ground water. We must have legislation that provides full cost recovery reflecting the true value of this precious resource.”
Further, CUPE BC states the new Act must address water use in other sectors, including oil and gas, mining and power production.
“If BC wants to make history with this new Act then let’s work together to create legislation that will be celebrated by our grandchildren’s grandchildren,” adds Hancock.