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2010 Report to Society CanadaMaximizing the value and life of the resource
De Beers Canada Inc. - 2010 Report to Society i
ContentsThe Family of Companies ii
The diamond pipeline iii
Summary of sustainability goals iv
Acronyms v
Preamble
The year at a glance 01
Outlook for 2011 01
About this report 02
Foreword 04
Financial overview 06
Introduction
Company profile 07
Target audience 10
Feedback from stakeholders 11
Governance and transparency through policies and practices
12
Approach
Management approach 16
Snap Lake Mine 17
Victor Mine 19
Gahcho Kué Project 21
Exploration 22
Operating highlights
Management approach 24
Risk and climate change 26
Risk assessment
Management approach 27
Investment in people and infrastructure 28
Corporate social investment 28
Feedback from communities and external stakeholders 29
Stakeholder engagement
Management approach 31
Financial highlights 34
Economics
Management approach 35
Ethics
Management approach 37
Strategy - Snap Lake and Victor Mines 38
Diversity and discrimination 39
Human rights 40
Compensation 41
Freedom of association 43
Employee training 43
Feedback mechanism 44
Harnessing and developing talent 45
Social issues 45
Communities’ and external stakeholders’ concerns, grievences and feedback from employees
45
Employee health and safety 46
Health and wellbeing 49
HIV/AIDS 49
Employees
Management approach 50
General approach to communities of interest 51
Agreements signed and implementation 55
Community, economic, environmental, health and safety, and social performance
55
The roll of our PVVs in how we work with our com-munities of interest
59
Issues raised, grievences, and disputes 59
Communities
Management approach 64
Environment at Snap Lake Mine 68
Environment at Victor Mine 70
Strategy 70
Biodiversity 71
Energy and climate 71
Energy efficiency 72
Greenhouse gases 73
Water management 73
Materials and waste 76
Storage of waste rock and processed kimberlite 77
Rehabilitation - Snap Lake and Victor Mines 78
Mine closure - Snap Lake and Victor Mines 80
Environment
Management approach 81
Contractors 81
Procurement 81
Procurement
Management approach 83
Status of certification 85
Assurance 86
Product responsibility
Glossary 89
Appendix A - GRI compliance table 90
Appendix B - ISO26000 compliance table 95
Appendicies
De Beers Canada Inc. - 2010 Report to Society ii
De Beers Canada Inc. - 2010 Report to Society iii
De Beers, established in 1888, is the world’s leading rough diamond company with unrivalled experience in the exploration, mining and marketing of diamonds. Together with its joint venture partners, De Beers operates in more than 20 countries across six continents employing more than 16,000 people, and is the world’s largest diamond producer with mining operations across Botswana, Namibia, South Africa and Canada. De Beers produces and markets approximately 35% of the world’s supply of rough diamonds by value. As part of the company’s operating philosophy, the people of De Beers are committed to Living up to Diamonds by making a lasting contribution to the communities in which they live and work. In the countries in which we have mining operations, this means carrying out profitable business, whilst at the same time helping Governments achieve their aspirations of turning natural resources into shared national wealth. De Beers encourages sustainable working to ensure long-term positive development. For example, in Africa, we return more than US$2.0 billion to the continent every year. For further information about De Beers visit www.debeersgroup.com
At De Beers, we have committed to live up to diamonds by making a lasting contribution to the communities in which we live and work. This means driving returns on capital, operating sustainably and working with our partner governments and communities to transform natural resources into shared national wealth.
The term Family of Companies is used to refer to the collective grouping of all the De Beers companies around the world.
The Family of Companies
Central Holdings Group
DB Investments (Lux)
Government of the Republic of Botswana
De Beers Diamond Jewellers
De Beers sa (Lux)
Anglo American plc
Element Six1
De Beers sa and shareholders Owned and controlled subsidiaries and divisions Joint ventures and independently managed subsidiaries
The De Beers Family of Companies
1 Non-abrasive - 100%, abrasives - 59.78%2 Marked entities are divisions rather than subsidiaries
45% 15%40%
74%50%50%
100%
100% 50%
100% 100%100%
Debswana Diamond Company
Namdeb Diamond Corporation
De Beers Consolidated Mines De Beers Canada De Beers UK
De Beers Group Services (RSA) Diamdel
DTC Botswana Namibia DTC DTC2 Forevermark DTC South Africa1
100%
100%50%50%
The diamond pipeline
Ups
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idst
ream
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eam
Access and explorationThis is where it all begins. Working with local communities and governments, we get our people on the ground to search for indicator minerals and diamondiferous kimberlites.
GrowthAdvancing projects, building new mines and creating a wealth of job opportunities through comprehensive education and skills training programs.
MiningTwo shifts work around the clock to liberate millions of rough diamonds every year.
Sorting and valuationThe sorting and valuation of rough production from De Beers Canada is done by the Diamond Trading Company (DTC).
Rough diamond salesThe DTC then arranges the diamonds into economic parcels for sale to Sightholders. Sightholders are selected in part for their adherence to our Best Practice Principles (BPP).
Cutting and polishingThe cutting and polishing industry then crafts each rough stone to highlight its individual attributes.
Jewellery manufactureMillions of designers, artists and craftspeople then set diamonds into their creations.
MarketingDe Beers has been at the forefront of diamond marketing for decades. Forevermark is currently shaping the future for global demand for diamond jewellery.
Jewellery retailAt last, a diamond’s journey through the diamond pipeline ends when you enter the jewellery store.
De Beers Canada Inc. - 2010 Report to Society iv
Summary of sustainability goalsOperations
Goal Degree achieved
Snap Lake Mine
Total mined target 1,060,000 tonnes.
Actual 1,079,000 tonnes. Target met.
Total ore mined target 760,000 tonnes.
Actual 855,000 tonnes: +15%.
Total tonnes treated target 789,000 tonnes.
Actual 869,000 tonnes: +10%.
Recovery target 1,137,000 carats.
Actual recovered 926,000 carats: -13%.
Victor Mine
Total mined target 8,339,000 tonnes.
Actual 9,612,000 tonnes: +8%.
Total ore mined target 2,780,000 tonnes.
Actual 2,660,000 tonnes: -1%.
Total tonnes treated target 2,631,000 tonnes.
Actual 2,773,000 tonnes.
Recovery target 749,000 carats. Actual 826,000 carats: +4%.
Gahcho Kué Project
Complete Feasibility Study. Feasibility Study completed except for a few minor adjustments.
File Environmental Impact Statement (EIS).
EIS filed with regulators on 23 December 2010.
Exploration
Complete large diameter drill sampling in 6 holes on Tango Extension.
4 holes completed, one hole stopped short, one hole not drilled.
Complete core drilling in 11 holes on Tango Extension.
Completed 11 core holes.
Complete 8 core holes on Delta-1.
Completed 8 core holes.
Complete scout sampling in two areas.
Completed.
Economics
Goal Degree achieved
Target EBITDA $94M; free cash flow $5 million
Actual EBITDA $128.8 million; free cash flow $50 million
Successful execution of Victor Resource Extension Plan
Achieved.
Gahcho Kué Project positive feasibility study
Feasibility study positive and robust.
Employees
Goal Degree achieved
Ensuring existing talent is maximized.
Great strides made on both mine sites.
Ensure all positions filled with capable and qualified people; conduct gap analysis.
98% of positions filled.
Sound Human Resources infrastructure with fair consistent policies, procedures, salary, benefits and pension administration.
Support mechanisms, policies and procedures are functional for operational effectiveness.
Minimize frequency and number of third party challenges and legal cases.
Majority of matters handled without legal intervention, and with favourable outcomes.
De Beers Canada Inc. - 2010 Report to Society v
Environment
Goal Degree achieved
Reach conformance with De Beers Family of Companies’ 6 standards for environmental management.
Four standards (life cycle planning, water, pollution and waste management, environmental reporting) over 80% complete. Remaining 2 standards (biodiversity and climate change risk) well advanced.
Improve change and risk management.
Procedures implemented based on corporate standard. Integrated into work practices.
Achieve a Level 3 for TSM by end of 2010 for both Snap Lake and Victor Mines.
Snap Lake achieved 50% of indicators (9/18); Victor achieved 66% indicators (12/18).
Snap Lake: Reduce number of spills.
Spills reduced 45% in 2010 over 2009.
Snap Lake: Zero wildlife deaths caused by mine activities.
Achieved. No wildlife deaths caused by mine activity.
Reduce resource wastage/shipment of waste off-site.
50% reduction of wastes shipped off-site compared to 2009.
Snap Lake: Meet water quality guidelines.
Not achieved. Currently redesigning for a new diffuser for installation in 2011.
Submit land use permit applications.
Achieved. Permit application for renewal submitted.
Victor: All Environmental Incident Frequency Rate target of 20.0 or less set in 2008.
Achieved rate was 18.6 by end of 2010. Currently aiming to reduce this further.
Victor: Implement diesel fuel reduction program.
Instrumentation and tracking system installed.
Procurement
Goal Degree achieved
Appoint manager for asset manager and supply chain.
Appointment made.
Align and improve asset management and procurement Canada-wide for De Beers Canada.
Progress has been made. Much still remains to be done.
Product responsibility and Assurance
Goal Degree achieved
Monitor uses and properties of diamonds to detect any negative emerging issues related to the physical properties of diamonds.
Work on this ongoing by various laboratories and research facilities of the De Beers Family of Companies around the world.
Achieve a Level 3 across the board for all 18 performance elements for TSM by the end of 2010.
Snap Lake achieved 9/18 (50%): Victor achieved 12/18 (66%).
AcronymsAB AlbertaAIDS Acquired Immune Deficiency SyndromeBPP Best Practice PrinciplesCBBC Canadian Business and Biodiversity CouncilCBSR Canadian Business for Social ResponsibilityCOI Community of Interestcpht Carats per hundred tonnesDBC De Beers CanadaDBIA De Beers Internal AuditEBITDA Earnings Before Interest, Taxes, Depreciation and AmortizationECoHS Environment, Community, Health and Safety EIS Environmental Impact StudyEITI Extractive Industries Transparency InitiativeEMS Environmental Management SystemGRI Global Reporting InitiativeHIV Human Immunodeficiency VirusIBA Impact Benefit AgreementIIA Institute of Internal AuditorsINAC Indian and Northern Affairs CanadaISO International Standards AssociationIT Information TechnologyJBET James Bay Employment and TrainingKPI Key Performance IndicatorLTIFR Lost Time Injury Frequency RateLTISR Lost Time Injury Severity RateMVEIRB Mackenzie Valley Environmental Impact Review BoardMVLWB Mackenzie Valley Land and Water BoardNWT Northwest TerritoriesOHSAS Occupational Health and Safety Assessment SeriesON OntarioPACI Partnership Against Corruption InitiativeSHE Safety, Health and EnvironmentSLEMA Snap Lake Environmental Management AgreementTDS Total Disolved SolidsTIFR Total Incident Frequency RateTSM Towards Sustainable MiningWHMIS Workplace Hazardous Materials Information Sheet
De Beers Canada Inc. - 2010 Report to Society 01
2010 saw exceptional growth in global demand for rough diamonds, after two consecutive years of market decline. Average rough diamond prices rose by 27% over the course of the year, to levels surpassing pre-recession highs of 2008. This was due to increased demand from retail markets, particularly India and China, and a strong US Christmas sales season.
De Beers Canada increased production in 2010 in line with this growing demand. Overall carat production from the company’s two mines increased by 53.4% compared to 2009 (1.75 million carats in 2010: 1.14 million carats in 2009). Snap Lake gradually increased output from a single shift at the end of 2009 to close to full production by the end of the year, while Victor mine continued at full production.
Despite this significant increase in production, our profitability was impacted by the strength of the Canadian dollar. Our revenue from the sale of diamonds is in U.S. dollars, while our costs are in Canadian dollars. Since the opening of the Snap Lake and Victor Mine in 2008, the weak U.S. dollar reduced the margin between our revenue and costs by almost 20%, putting a considerable strain on Canadian teams to contain costs through efficiencies and careful management of expenditures.
The diamond recovery in 2010 re-affirmed the importance of securing increased supply, and investing in future capital projects. At Gahcho Kué, a feasibility study by De Beers Canada in collaboration with our joint venture partner, Mountain Province Mining Inc, was completed with just a few areas requiring minor amendments at year end that should be closed off in early 2011 for a board decision whether to go ahead or not to proceed into the formal project phase. An Environmental Impact Study (EIS) was prepared and submitted to the Mackenzie Valley Environmental Impact Review Board in December 2010. On the exploration side, work focused on previously identified targets close to the Victor Mine as potential future resources.
Pressure from the exchange rate and a focus on maintaining the cost efficiencies that were gained through the challenges of the recession, resulted in ongoing cost-efficiencies throughout the year. Staff worked continually to identify additional ways to contain expenditures and increase efficiencies without increasing costs. Work centred on actively
searching for methods of shortening the project development timelines, focusing exploration efforts, examining acquisition, divestment and joint venture strategies, and building a strong group of sustainable projects. Both the Snap Lake and Victor Mines met their commitments to community, business and government partners throughout the year.
Our efforts were focused on the Towards Sustainable Mining initiative of the Mining Association of Canada. Considerable progress was made in this regard (see the assurance section for details). Several environmental initiatives were actively pursued and good progress was made with research for revegetation and rehabilitation at the Victor Mine. Our Corporate Social Responsibility and Social Investment activities were continued.
We were honoured to receive several awards during 2010. These were: the first ever Timmins & Area Chamber of Commerce’s President’s Award (Victor) for achieving a level of business excellence that merits special recognition including business contribution to Community, marketing innovation, environmental and Aboriginal partnership; an Ontario Chamber of Commerce Business Excellence Award (Large Business) – (Victor); and the John T. Ryan Safety Award (Western Region) – (Snap Lake) for safety in 2009.
Outlook for 2011De Beers Canada is well positioned for 2011. The continuing strength of the Canadian dollar presents an ongoing challenge. The various forecasts that we have seen consistently predict that the Canadian and US dollars are likely to remain close to parity for at least the next year and that the Canadian dollar may even strengthen a little more. We will have to remain focused on innovation and cost containment in the months ahead to ensure that operations remain viable. Conservation of cash remains a priority: production will continue to be geared to meet client demand and to generate sufficient income to service interest and debt payments. Revisions to the work plans will be made as required during the year to maintain these business goals. At the same time, we will pursue the environmental assessment for Gahcho Kué so that this project is ready to be developed if approved by the board in 2011. We will continue our journey toward Zero Harm with renewed vigour and focus on reducing the number of incidents and accidents across the company.
The year at a glance
De Beers Canada Inc. - 2010 Report to Society 02
This is the third annual Report to Society for De Beers Canada. As with previous years, the report provides an account of our sustainability performance over the preceding calendar year, and presents data captured over our annual production period of 16 December 2009 to 15 December 2010. None of the information provided in earlier years has been re-stated, except for water data (see Environment section).
This report contains a broad overview of the De Beers Family of Companies and where De Beers Canada fits into this, an overview of the ‘Diamond Pipeline,’ and sections addressing ethics, economics, employees, communities and the environment. Our focus is on the activities of De Beers Canada within Canada. In addition, we report on operations at the two mines including, procurement, product responsibility, exploration and assurance. Our theme this year is “Maximizing the Value and Life of the Resource”.
This company-level report is prepared in addition to reports produced to meet regulatory requirements for our operations. For Snap Lake Mine these include Socio-Economic Reports for (2005-2009), and Environmental Reports (2005-2009), with the 2010 Environment Report planned for release by the end of June 2011. Similar reports on the environment were issued for Victor for the construction period (2006 - 2007) and for the first two years of operations (2008 and 2009), while the report for 2010 is scheduled for release by the end of June 2011. In the future, the statutory
reports will continue to be produced, and will also be linked to this report in the web based version by hyperlinks as they are produced. Note that the reporting period for most of the statutory reports is not a calendar year, but the period defined in the regulatory instrument.
Lessons learned from our first two reports showed that while the main sections provided much information, there was insufficient detail in several areas. We have reduced the use of technical terms and jargon to make the report easier to read and understand. We are increasing the use of graphs and figures to show progress now that we have three years’ worth of data to work with. We have also increased the number of areas where we share our goals, and increased the information on Management Approaches. We hope that these changes will provide clearer information to the reader.
In keeping with our commitment to sustainable development, we are changing the format of our Report to Society to reduce our use of natural resources. The detailed full report will continue to be produced, but will be made available electronically on our website www.debeerscanada.com. Links are included to point to where more information is available on line. For those who prefer to receive the report in hard copy, a shorter, summary version can be requested and is available for download. We would love to hear back from our readers what you think of the summary printed report, and of the on-line version (see Contact Us > Feedback Form for alternatives to provide feedback).
What you will find in this reportThis report summarises our activities with regards to sustainability and corporate social responsibility. We also include brief descriptions of our operations and exploration activities together with a summary of our economic performance to provide a “One Report” overview of De Beers Canada. We have tried to provide the information that our communities of interest have indicated is of interest to them. If there is additional information that you would like to see in the future, please let us know. We are producing this Report to Society to increase transparency and provide information to our communities of interest and stakeholders.
The priorities for communities indicated within this report flow from the comments heard at the meetings with the various communities during the period.
About this report
Download the complete report atwww.debeerscanada.com
De Beers Canada Inc. - 2010 Report to Society 03
De Beers Canada uses the Brundtland definition for sustainable development, namely “ensuring that activities today meet the needs of the present without compromising the ability of future generations to meet their own needs”. Following discussions with our communities of interest, six areas of common priority have been identified as significant.
Three areas are:(i) business opportunities,(ii) training and education, and(iii) employment.
These are in addition to:(iv) economic growth,(v) protection of the environment, and(vi) health and safety of the communities and their members.
Taken together, these form the building blocks for sustainable communities that would have the wherewithal to continue to develop and thrive after our activities have ceased, and to benefit the future generations of community members.
We had planned to have a more formal methodology to capture feedback and information from these communities in place during 2010. This will now only be in place in 2011. While our impact and benefit agreements define minimum frequencies for meetings with the communities, we have found it useful to hold meetings on a more regular basis where this can be arranged. Most of the information in this report summarizes data that communities have requested.
In line with the De Beers Family of Companies, we place greater emphasis on risks and risk assessment in this year’s report. Other areas of focus include climate change, water and impacts on communities and their feedback.
Material for inclusion in this report was selected on the basis of what we have heard from our communities of interest as being topics of interest to them, and on the requirements for both the Global Reporting Initiative (GRI) and the ISO 26000 guidance document. An alignment check was made with the requirements of the Prospecting and Developers Association of Canada’s “e3 Plus” program. There have been no changes from measurement methods used in 2008 and there are no re-statements of information from earlier reports, except for water data.
Where De Beers Canada is the operator, we report on Joint Ventures and statistics are included. Where De Beers Canada is not the operator, or where it is a minority partner, statistics are not included. Statistics are also not included where De Beers Canada has an un-exercised option or retains a gross overriding royalty in a former property that has not reached the feasibility stage of development. Currently there are nine such properties and these are considered to have a possible but currently unquantifiable potential.
This report is in general conformance with the GRI, including the Mining and Metals Sector Supplement, and the ISO26000 requirements (2010). Compliance tables for GRI and ISO26000 are attached as Appendices A and B.
Data are measured through a variety of methods. Employee and contractor numbers are collected by the Human Resources Department, and reflect actual numbers. Economic numbers for the financial section are from the corporate accounts and records, and are rounded. Materials consumed are from direct readings: volumes and tonnes mined and processed are from survey calculations, and direct tonnage measurements from scales called ‘weightometers’ that measure the mass of material passing over them in the process plant. The latter are reconciled with the materials mined. Information for communities is taken from notes and minutes of meetings, and from correspondence with stakeholders.
This report covers the period January 1, 2010 to December 31, 2010 in line with the intention for these reports to cover a calendar year, and the reporting period is unchanged from previous years. The statistics reflect our production period from 16 December 2009 to 15 December 2010. None of the information provided in earlier years has been re-stated, except for water data.
De Beers Canada Inc. - 2010 Report to Society 04
Welcome to the 2010 De Beers Canada Report to Society, our third comprehensive assessment of our business unit, community engagement and efforts in the area of corporate social responsibility and sustainability.
Sustainability and corporate social responsibility are at the core of our business as we work to minimize our impact on the environment and maximize the benefits to all interested parties. Sir Ernest Oppenheimer, a former Chairman of the De Beers Family of Companies, of which De Beers Canada is a part, stated “Our aim is to make profits but to do so in a way that makes a positive and lasting contribution to the communities in which we operate.” These words still serve, 56 years after they were uttered, to motivate and guide us on our path to sustainability.
As part of our progress towards sustainable development, we merged our environmental, occupational health and safety policies with our previous sustainable development policy to form a single broader and more comprehensive sustainable development policy.
As we move forward into 2011 and away from the issues of the economic downturn, it is our intention to increase our focus on the sustainability of our activities in order to improve the life of our operations, to control costs, reduce negative impacts and to improve positive benefits to our communities of interest over the longer term. 2010 was a year of consolidation for De Beers in Canada. The slow recovery in 2009 gathered momentum in 2010, resulting in a significant increase in demand. Throughout the year, our employees, community partners and business partners collaborated well and responded to the changing circumstances we faced collectively. It was inspiring to see many of the relationships strengthened by year-end as we focused on our production plans for 2011 and beyond.
Implementation of the seven Impact Benefit Agreements (IBAs) for our two mines continued, and considerable progress was made in most areas with regards to employment, training and business opportunities.
De Beers Canada has built a strong foundation through social investment, with our Books in Homes program and our investment in learning and training centres. We recognize the importance of literacy as an investment for the future, and we remain committed to supporting these initiatives through the life of our operations. We will consider additional initiatives as the opportunities and available resources permit.
In this report, you will find figures outlining our training efforts and the scale of the business opportunities that our communities have been able to realize. While the business opportunities reflect the total value of the contract awarded and do not reflect the quantum of the profit to the respective communities, the numbers show a steady growth year over year.
A number of initiatives will have priority in our corporate social responsibility and sustainability spheres over the next three to five years. With regard to safety, we will continue our drive for ‘Zero Harm’ and develop more leading indicators to augment the existing lagging indicators. We will expand the Internal Responsibility System, and once we have obtained our OHSAS18001 registration, it will help strengthen our safety and environmental management systems.
Our environmental management plans focus on biodiversity, energy and greenhouse gas management and reduction, and pollution prevention. This ties in with our Towards Sustainable Management (TSM) initiative as a member of the Mining Association of Canada. Our commitment is to reach level 3 across all the four existing performance elements by the end of 2011, and to improve this to a Level 5 by 2015. As the additional performance elements for TSM are launched over the next few years, we will attain a Level 3 and improve this to a Level 5 in a practical, safe and timely manner. Specific projects are identified for energy management and greenhouse gas emissions. Other environmental issues will be managed under adaptive management and continuous improvement processes. We will evaluate how best to verify those sustainability activities that fall outside the TSM initiative to strengthen our social license to operate.
The lessons that we have learned from the construction of our two existing mines, together with our operating experience over the last three years since they opened in 2008, will be incorporated into the design for Gahcho Kué, should it receive the go-ahead.
On the exploration front, we remain committed to best practices and our long history of early and proactive community engagement with our communities of interest. This engagement will continue to be grounded in respect, responsibility, and recognition of treaty and aboriginal rights. We will look for opportunities to leverage our skills and experience to assist our communities of interest with those issues and priorities that match our strengths.
Forewordfrom the Chief Operating Officer, and Acting Chief Executive Officer Chantal Lavoie
De Beers Canada Inc. - 2010 Report to Society 05
Operational highlightsWith the improvement in global demand for diamonds in 2010, the production targets for De Beers Canada were increased by 54% at the start of the year in comparison to the actual carats produced in 2009. Already operating at full production, the Victor Mine was able to deliver 826,000 carats by the end of the year – an increase of 18.7% over 2009. The team also reduced costs and expenditures considerably, which was a tremendous help in off-setting the strong Canadian dollar.
Much of the work at Snap Lake featured growing the workforce and ensuring the employees were well trained by year-end in support of the return to full production targets. The year-end carat production for Snap Lake was 926,000, an increase of 108.6%. Considerable effort was expended on underground development to prepare a sufficient number of different areas for mining in the future and to provide us with the ability to be flexible in where we are mining.
Our performance in the areas of safety, occupational health and environment shows that we still have work to do to build a more resilient safety culture. The number of Classified Injuries (Lost Time and Restricted Work) is unacceptable, having increased from three (3) in 2009 to thirty-two (32) in 2010. An analysis indicated the majority of the injuries were the result of complacency with respect to the hazards in day-to-day tasks, weak task planning and inconsistent application of procedures for field-level risk assessments. The most common agencies of injury were slips, trips and manual handling of material. Injuries to the leg or ankle were most common resulting from slips, trips and falls followed by hand injuries resulting from manual material handling and improper use of non-power tools. Observations at the end of the year indicate that:
i) under the leadership of the new Mine General Manager, Victor has made significant improvements in creating a culture of shared responsibility and no-fault reporting, and
ii) continued strengthening of the safety culture at Snap Lake is required. An improvement strategy is being implemented at Snap Lake and progress will be monitored closely
All operations have maintained Environmental Management Systems certified to ISO 14001. Safety and Health Management Systems based on the OHSAS 18001 standard are in place. The goal to be certification ready by the end of 2010 was met by Exploration and full certification is on track for March 2011; however, the mines experienced a set-back in achieving this goal. The delay was related primarily to turnover of key staff and competing priorities. Key occupational health components including engagement of employees and training needs to be completed before the first stage of certification can be completed. The revised targets for achieving certification are July 31 and September 30 in 2011 for Victor and Snap Lake, respectively. These targets will be included as KPIs for the Mine General Managers and progress reported monthly to the Executive Committee of De Beers Canada.
Thank you for taking the time to learn more about De Beers Canada. I hope this 2010 Report to Society will provide you with a better understanding of our purpose, vision and values. I encourage you to provide feedback to us on the nature of this report and its content. At the end of this report, there is information on how to submit comments, and there is a link online to help readers do so.
Snap Lake Mine Victor Mine
De Beers Canada Inc. - 2010 Report to Society 06
2010 was an incredibly dynamic year. We saw robust price increases for rough diamonds against the backdrop of continued global economic fragility. We sell our diamonds to our sister company, the Diamond Trading Company (DTC). The DTC set about addressing the price reductions felt across the industry in 2009, through a series of cautious but consistent price increases in 2010 as the global economy continued to recover. These increases took into account the state of the returning global demand, the sense of optimism across the diamond industry, buoyancy in the retail market and the stability among our Sightholder customer-base. These price increases exceeded those forecast in our 2010 budget and went a long way to countering the impact of the weak U.S. dollar and difficult foreign exchange rates.
Although Victor Mine exceeded its planned production in terms of the number of diamonds recovered and sold, Snap Lake Mine did not meet its target of diamonds recovered. This resulted in De Beers Canada producing fewer diamonds than planned in 2010. Despite this shortfall, the price increase was significant enough to offset both the negative impact of the foreign exchange position and the shortfall in diamond sales to leave De Beers Canada with higher reported revenues than those forecast. This outcome emphasizes the importance of price on the bottom line of the company. To maximize the benefit of strong prices, it was essential throughout the year to demonstrate an ability to control our operating costs and capital program to ensure that both came within budget. This required us to revisit our planned expenditures in order to absorb unforeseen costs. We did this by adjusting our thinking in other areas, and looked for new innovative solutions that required less investment. The De Beers team responded to this continuous challenge to make sure the books remained ‘balanced’. I am pleased to announce that we not only achieved this, but we came in under budget.
We completed the investment in the accommodation complex at Snap Lake Mine in 2010, transitioning from the aging construction camp to this modern, fit-for-purpose unit. This inter-connected facility forms one of the commitments we made to Snap Lake during the project phase, and was an essential investment to ensure we attract and retain the right employees in an increasingly competitive mining industry.
Outside of our current mining operations, we continued to move forward with our exciting prospective project, Gahcho Kué, with our joint venture partner, Mountain Province Diamonds Inc. During 2010 we made significant progress in assessing the entire capital and operating solution for the potential mine. De Beers Canada and Mountain Province retained JDS Energy and Mining who produced a draft feasibility study, which Mountain Province have reported as demonstrating robust financials. The study is currently undergoing review by the Joint Venture Partners.
During 2010, we also responded to new initiatives by the De Beers Family of Companies to continuously improve the effectiveness of our reporting processes. We successfully implemented a new reporting process on-time and on-budget and are benefiting from the efficiency of the automated production of our monthly financial reports. Similar system-developed initiatives launched in 2010 will continue into 2011, delivering smarter and more efficient solutions to report accurate data quickly and with the flexibility to accommodate any changing scenarios the market may dictate. In a similar vein, 2010 saw an overdue investment in our Information Technology (IT) infrastructure with the creation of an entire independent centre for our communication and infrastructure hub, providing the redundancy a company of our spread and complexity requires. Other investments in our IT infrastructure included the adoption of upgraded hardware and software aimed at improving our ability to continuously access, process and interpret the many essential business information items that we rely on to make smart decisions ahead of issues arising.
In summary, 2010 proved to be another challenging but rewarding year. We made great strides across all operational aspects of the business, advancing the knowledge within the business while building the robustness needed to anticipate and react to future challenges. No doubt 2011 will prove to be an equally dynamic year. We will face it with increased optimism due to the steady improvement in the global economy, the continued forecast growth for the diamond industry and the confidence in our team at De Beers Canada to continue to overcome both the known and unexpected challenges De Beers Canada has already faced in our young history.
Financial overviewfrom the Chief Financial Officer, Steve Thomas
De Beers Canada Inc. - 2010 Report to Society 07
Management and GovernanceDe Beers Canada subscribes to the De Beers Family of Companies’ “Purpose, Vision and Values”. For details visit www.debeersgroup.com
De Beers Canada also subscribes to the principles of accountability, transparency, ethical behaviour, respect for the rule of law, respect for international norms of behaviour and respect for human rights.
Purpose, Vision and Values With input from across the entire De Beers Family of Companies, a Purpose, Vision & Values (PVV) was created in 2005. The intent on an economic and business level is to define the parameters of our goals and strategies as they change over time - what things we will pursue in our strategy and why we will pursue them. The PVV also assists us in our decision making by providing boundaries for our choices and a common organizational focus worldwide on what we need to do to achieve our goals and strategies. The PVV is not about achieving performance levels but about achieving personal value in our accomplishments – pride in the company and pride in what we do. Simply put, it gives us a higher purpose beyond financial goals.
PurposeThe purpose of the company is to implement the De Beers Family of Companies’ activities for exploration and mining in Canada.
VisionUsing the Family of Companies’ PVVs as a foundation, De Beers Canada has a corporate vision of “Delivering value growth through diamonds: We will be the premier diamond company in Canada by setting new standards for growth, shareholder value, employee commitment, social responsibility and reputation”.
Company profile
Be Passionate - We will be exhilarated by the product we sell, the challenges we face and the opportunities we create.
Pull Together - Being united in purpose and action, we will turn the diversity of our people, skills and experience into an unparalleled source of strength.
Build Trust - We will always listen first, then act with openness, honesty and integrity so that our relationships flourish.
Show We Care - The people whose lives we touch, their communities and nations and the environment we share, all matter deeply to us. We will always think through the consequences of what we do so that our contribution to the world is real, lasting and makes us proud.
Shape the Future - We will find ways. We will set demanding targets and take both tough decisions and considered risks to achieve them. We will insist on executional excellence and reward those who deliver.
Values
StrategyThe strategy regarding its contribution to sustainable development is:
“To operate in accordance with the principles of sustainable development. This means ensuring that activities undertaken today meet the needs of the present without compromising the ability of future generations to meet their own needs. This requires all employees and contractors to take account of the longer term economic, social and environmental implications of their decision making and actions – not just for business but for society at large.”
De Beers Canada Inc. - 2010 Report to Society 08
Who we areDe Beers Canada is a diamond exploration and mining company operating in Canada only and it is the Canadian arm of the De Beers Family of Companies. De Beers Canada consists of three divisions: corporate, exploration and mining.
The corporate division, based in Toronto, provides financial and other centralized services.
The exploration division, also based in Toronto, has a processing facility in Sudbury, Ontario (ON). The exploration division is responsible for exploring, discovering or locating and testing new diamond deposits. There are a number of exploration projects in different parts of Canada. Currently exploration work is focused on exploration in Ontario. There is one joint venture, the Gahcho Kué Project in the Northwest Territories, in the feasibility stage. The Gahcho Kué Project entered the Environmental Assessment phase at the end of 2010.
The mining division consists of the two mines, the Snap Lake Mine in the Northwest Territories (NWT) and the Victor Mine in Ontario. Snap Lake is an underground mine, while Victor is an open pit mine. While De Beers Canada has its head office in Toronto, there are offices in Yellowknife (NWT) supporting the Snap Lake Mine, in Timmins (ON) supporting the Victor Mine, and in Sudbury (ON) supporting the exploration activities. The Gahcho Kué project is supported by both the Yellowknife office and the Toronto office, and moved to the mining division during 2010.
All De Beers’ Canadian production is sold under contract to the Diamond Trading Company (DTC) in the United Kingdom. Through an undertaking with the government of the Northwest Territories, up to 10 per cent of the production by value from Snap Lake is made available for purchase by sightholders in the NWT. There is a similar agreement with the government of Ontario whereby 10 per cent of the production by value is made available for sale by the Diamond Trading Company to sightholders in Ontario. All sightholders are approved by the province or territory and the Diamond Trading Company. For more on the DTC and a listing of DTC Sightholders, please click the links provided. Those diamonds that are not sold under the above two agreements are sold by the DTC to sightholders from around the world.
De Beers Canada is a wholly-owned subsidiary of De Beers Société Anonyme which in turn has three shareholders: Anglo American plc (45 per cent), the Central Holdings Group, representing the Oppenheimer family (40 per cent), and the Government of Botswana (15 per cent). There
were no significant changes regarding size, structure or ownership during the period.
De Beers began formally working in Canada in the early 1960s, with its activities dedicated to the exploration for diamonds. More recently, activities focus on the exploration and mining of diamonds. From an initial staff of four people in Canada, the company has grown to its current staff level of 1,087 employees including full-time, part-time and seasonal workers of which 75 were part-time and contract workers at the end of December 2010.
The Gahcho Kué Project, formerly known as Kennady Lake, is a joint venture between De Beers Canada (51 per cent) and Mountain Province Diamonds Inc. (“MPV”; MPV 49 per cent).
All mining operations undertaken by De Beers Canada have undergone environmental assessments in accordance with the applicable Canadian legislation prior to the commencement of construction and operations.
In addition, De Beers Canada also is moving to compliance with the Mining Association of Canada’s ‘Towards Sustainable Mining’ initiative within three years of the commencement of commercial production for both the Snap Lake and Victor Mines. Towards Sustainable Mining (TSM) is an initiative developed by the Mining Association of Canada (MAC) to improve the industry’s performance by aligning its actions with the priorities and values of Canadians.
This report is based on the Global Reporting Initiative (GRI) Mining and Metals Sector Supplement and the 2006 version of the Reporting Guidelines (v3.0). The following GRI sections are not included, and the reasons are summarised in Table 1-1. A full GRI concordance table is attached as Appendix A.
For more information:www.mining.ca
www.mountainprovince.comwww.dtcsightholderdirectory.com
www.dtc.com
The main pumping station underground at Snap Lake Mine
De Beers Canada Inc. - 2010 Report to Society 09
Table 1-1: GRI principles or protocols that are not included
GRI Principle or protocal description Reason why not included
EN30 Environmental protection expenditures and investment by types.
Environmental expenditures are grouped with safety and health, and are not available as a separate discrete number.
Based on a self-assessment, this report is in general conformance with GRI, and is also in general conformance with the ISO26000 2010 guidance document. Exceptions are noted below in Table 1-2. A full concordance table for the ISO26000 guidance is attached as Appendix B.
Table 1-2: Exceptions ISO26000 2010 requirements
Requirement Reason excluded
7.8.2 Voluntary nature of participation Insufficient data.
7.8.3 Considerations Insufficient data.
The Glossary (see page 89) contains the definitions and criteria used in economic, environmental and social benefit descriptions.
exempli gratiaEnvironmental monitoringDivers were below the ice of Snap Lake in mid January to install temperature loggers on an artificial reef created on the lake bottom and to identify and locate old drill holes that could result in lake water getting into the mine. Pictured here, one diver remains on the surface while the others are below. The artificial reefs were constructed by De Beers Canada as part of an impact reduction program under the Department of Fisheries and Oceans.
De Beers Canada Inc. - 2010 Report to Society 10
Table 1-3: Main stakeholder groups
Priority Communities of Interest Stakeholder Type of engagement Rationale
1 Communities of interest
Snap Lake Mine Tlicho Government; Yellowknives Dene First Nation; Lutsel K’e and Kache Dene First Nation; North Slave Métis Alliance.
Through IBA consultation. • Communities most impacted• Source for bulk of labour
Victor Mine Attawapiskat First Nation;Fort Albany First Nation;Kashechewan First Nation;Moose Cree First Nation.
Through IBA consultation and communications through meetings and the media.
• Communities most impacted• Source for bulk of labour
1 Communities of interest
De Beers Canada
De Beers Family of Companies;De Beers Canada employees;Shareholders.
Through internal communications.
Employees, parent company and shareholders.
1 Communities of interest
De Beers Canada Exploration
Attawapiskat First Nation;Kitchenuhmaykoosib Inninuwug; Bearskin Lake First Nation; Wapekeka First Nation.
Through meetings with community leadership and community members.
Communities where we are working or where we wish to work.
2 Communities of interest
Snap Lake Mine Federal government departments; Government of the NWT; City of Yellowknife.
Through dialogue and general communications.
Regulators and governments with whom we work.
Victor Mine Federal government departments; Ontario provincial government; City of Timmins.
Through dialogue and general communications.
Regulators and governments with whom we work.
2 Communities of interest
De Beers Canada
Contractors; Suppliers; Regional aboriginal organizations; Non-governmental organizations.
Through direct communications and meetings.
Parties with whom we work.
3 Communities of interest for both mines
Snap Lake MineVictor Mine
Other communities;General public.
Through direct communications or posting of public information.
Interested parties.
Target audienceThis report is aimed at the company’s main groups of stakeholders which we refer to as Communities of Interest (COI). These are summarised in Table 1-3.
De Beers Canada Inc. - 2010 Report to Society 11
All of De Beers Canada’s exploration and mine operations have environmental management systems (EMS). One of the basic tenets of the EMS used by De Beers Canada is inclusion of both the precautionary approach, and of adaptive management. Wherever practical, traditional ecological knowledge is also combined with ‘western science’ to ensure an optimal work plan can be derived. The same basic approach is also followed for social issues.
De Beers Canada maintains membership in a number of key industry and community associations, including the Mining Association of Canada, the NWT/Nunavut Chamber of Mines, the Ontario Mining Association, and the Canadian Business for Social Responsibility. Through its parent company, De Beers is a signatory to the Millennium Goals, the Extractive Industries Transparency Initiative (EITI), the Partnership Against Corruption Initiative (PACI), the Global Reporting Initiative and the UN Global Compact.
Feedback from StakeholdersThe first Report to Society for Canada was released for the year 2008 in mid-2009 and 155 printed copies and 198 digital copies were sent to our external stakeholders. No formal feedback mechanism was included in the report although details were provided on how to obtain additional information. No comments or feedback were received from any of these external stakeholders, and none was received from our internal stakeholders.
The second Report to Society was released for 2009 in mid-2010 and we sent out 239 printed copies to our external stakeholders. Readers were invited to submit comments by completing a reader’s survey card, or by submitting comments on line. No comments or feedback were received from any of these. We did receive four comments from our employees which are summarised below.
Interestingly, the employees were evenly split into those who preferred a digital report to a printed report (labelled Digital below). However, the sample was really too small to be meaningful.
Table 1-4: Summary of feedback on Canadian Report to Society
Year Comment Action
2008 None Not applicable
2009 None Not applicable
2010 4 individuals submitted comments: 2 from Toronto office and one each from Snap Lake and Victor. See chart for details. Respondents 3 out of 4 felt there was enough information, 1 individual wanted more. One felt the report was a bit long, the other 3 thought the length was about right. Respondents were divided equally between those who would prefer a print copy and those who prefer a digital copy.
• Format changed to provide an in depth version on line and a shorter overview report
• Materials re-organized to simplify the flow of information and group like materials
• Environment section restructured
• Ethics section expanded
5
4
3
2
1
Digital copy?
Report too long? Readability Approach Commun-
ities Economics Environ-ment Employees Ethics Operating
Highlights
Feedback summaryRespondents ranked their opinion of the following from 1 to 5 (low to high).
Legend:Respondent 1 2 3 4
De Beers Canada Inc. - 2010 Report to Society 12
Management ApproachOur approach is to operate in a legally compliant manner, using consistently good management and sound governance.
De Beers Canada, as a member of the De Beers Family of Companies, participates in the Diamond Trading Company Best Practice Principles (BPP) Assurance Program. This monitors economic, ethical, environmental, human resources including health and safety aspects of De Beers Canada’s activities in Canada, and also incorporates corporate governance, code of business conduct, anti-bribery and corruption, anti-money laundering, combating terrorist financing and human rights, as well as compliance with the ‘Kimberley Process Certification Scheme’ for rough diamonds, and the World Diamond Council’s ‘System of Warranties’. Work is in progress to merge these with the Responsible Jewellery Practices before the end of 2011. In addition, De Beers Canada is a member of the Canadian Diamond Code of Conduct, a non-profit volunteer industry body that administers the Code establishing the minimum standard required to authenticate a claim of Canadian origin of a diamond through a chain of warranties. For further details, please see the ‘Ethics’ section.
The BPP Assurance Program is a self-assessment that is then subject to the company’s Internal Audit department, and later externally assessed by an independent third party, currently SGS. De Beers Canada had been undergoing external assessment since 2006. In 2010, a physical third party independent assessment was undertaken of the Victor Mine site. There were four major non-conformances, two minor non-conformances and one opportunity for improvement. No other non-conformances or non-compliances were reported during 2010 for the previous year (2009) by any of the other entities within De Beers Canada.
Policy statements for anti-money laundering and combating terrorist financing, human resources, social investment, sustainable development (including environment, occupational health and safety, economic and social aspects) and working with Aboriginal communities can be found on our website. Many other policies are in place and are hosted on the company intranet. Specific policies are also in place at each mine to address unique aspects of that particular mine that are not addressed by the corporate
policies or to accommodate specific provincial or territorial requirements.
De Beers Canada is aligned with the following codes and standards that the De Beers Family of Companies also voluntarily complies:• The De Beers Family of Companies Best Practice Principles• Global Reporting Initiative (GRI Mining supplement)• Millennium Goals• EITI - Extraction Industries Transparency Initiative• PACI - Partnering Against Corruption Initiative• Voluntary Principles on Security and Human Rights• UN Global Compact• Universal Declaration of Human Rights
In addition, the ISO26000 guidelines (2010) were used in the preparation of this report for Canada.
Governance andtransparency through
policies and practices
For more information:www.responsiblejewellery.com
www.canadiandiamondcodeofconduct.comwww.debeerscanada.com
Mobile equipment crews working at the Victor Mine.
De Beers Canada Inc. - 2010 Report to Society 13
Governance structure and management systemsDe Beers Canada has a Board of Directors consisting of five members. As at December 31, 2009, the Directors were:
* Executive member
** Independent, non-Executive member.
An independent member is considered to be an individual that has no financial interest or other potential interest that could constitute a conflict of interest. An Executive member is considered to be an individual that is a Director of the company and who holds an Executive Management position within De Beers Canada or within the De Beers Family of Companies. A non-Executive member is an individual who is a Director but is not an Executive of either De Beers Canada or any of the De Beers Family of Companies.
The Chairman, Jonathan Oppenheimer is the Chair of the De Beers Canada Board: he is not employed by De Beers Canada, but he is an employee of the parent company De Beers Société Anonyme where he is the Head of Chairman’s Office De Beers Group. Mr. James Gowans
stepped down as president of De Beers Canada at the end of 2010 to take up other duties within the De Beers Family of Companies. We thank him for his guidance and contributions to the success of De Beers Canada. Mr. Robin Mills resigned as a Board member on 23 April 2010, and Mr. Chantal Lavoie was appointed to the Board with effect from 23 April 2010. There is an Executive Committee that reports to the Board of Directors for De Beers Canada, and in addition, each of the Snap Lake and Victor Mines has its own Executive Committee that reports to the main corporate Executive Committee. There is an Internal Audit function across the entire De Beers Family of Companies, and De Beers Canada has its own Internal Audit function and an Audit Committee (appointed 23 November 2008) that reports to the De Beers Société Anonyme Audit Committee and to the De Beers Société Anonyme Board. Beside an Audit Committee, De Beers Canada does not have any other committees under the Board of Directors that are responsible for setting strategy or for oversight of the organization. Currently all of the De Beers Canada Board Members also serve on the Audit Committee.
The Board of De Beers Canada is comprised of the President, CEO and CFO of De Beers Canada Inc, plus one non-executive Director ; the non-executive Director is a senior partner of a premier Toronto legal firm. The Board composition has changed several times during the last four years and throughout has been reconsidered by the Board members to ensure it retains the right combination of extensive business experience, industry specific experience and technical skills covering De Beers Group practices, mining specific in-depth technical knowledge, and financial and legal expertise based on global and Canadian experience. The Directors are familiar with the specific governance requirements issued by De Beers Société Anonyme, to which all De Beers Group companies are expected to comply and as experienced personnel are expected to bring that knowledge and experience to bear in their duties. Several key governance documents with which Board members are familiar and expected to comply include, the BPP, Code of Business Conduct and Ethics, Declaration of Interests, and Criminal History Self Declaration Form.
The executive Directors are specifically involved in the formation, endorsement and communication of the sustainable development policy, including Safety, Health and Environmental elements, guidelines and practices. The company has invested heavily in these fundamental aspects of business practice and this is evident in the maintenance of internationally recognized standards such as ISO 14001, OHSAS18001 and the commitment to producing a Report to Society document in respect of De Beers Canada in addition to contributing to the production of the Family of Companies’ report. The company has also committed to meeting
Jonathan Oppenheimer*, Chairman, De Beers Canada Inc.
Robert L. Shirriff**,Q.C., Fasken Martineau LLP (also senior legal counsel for De Beers Canada)
James K. Gowans*, President De Beers Canada Inc. and Chief Operating & Technical Officer, De Beers Family of Companies
Steven J. Thomas*,Chief Financial Officer, De Beers Canada Inc.
Chantal Lavoie*, Chief Operating Officer, & Acting Chief Executive Officer, De Beers Canada Inc.
De Beers Canada Inc. - 2010 Report to Society 14
the requirements of the Mining Association of Canada’s drive Towards Sustainable Mining, which has required the support of the Board and senior executive management across De Beers Canada to devote the time and resources necessary to meet this challenge.
The Board endorsed the formation of an audit committee, with defined Terms of Reference in order to separate the duties specific to that body from the Board in keeping with best practice principles in Canada and to match practice elsewhere throughout the Group. The Board also considered the adoption of a comprehensive Board Charter and at that time did not feel the formality of such a document was necessary but will revisit the benefit of such a document being formally adopted, in light of the increasing focus on the role of the Board as a key aspect of the demonstrating commitment to good governance.
The Board of De Beers Canada has specific duties to approve the Financial Statements of the Corporation, approving the Budget for the next Fiscal Year prior to presentation to Group and approving the internal audit plan and appointment of the External auditors, as recommended by the Audit Committee. In doing this the Board is then subject to scrutiny by the parent through its subsequent consideration and approval of these documents.
The Board members have been selected to provide a considerable mix of professional and technical skills allied with extensive experience of the mining industry and operation of De Beers’ global business. Mr Oppenheimer has extensive knowledge and experience of the De Beers Family of Companies, together with a holistic view of the diamond industry. Mr Lavoie is a registered professional engineer in the Northwest Territories, Ontario and Quebec, who brings technical skills and a first-hand knowledge of the incorporation of sustainability, social and environmental matters into operations. Mr Thomas is a Chartered Accountant and provides strong financial and commercial skills from both the mining and sales and marketing operations within De Beers. Mr Shirriff practices corporate/commercial law, with emphasis on mining, corporate finance and securities law. He has over 45 years’ experience in the field of commercial, corporate and mining law and is experienced in the negotiation of all manner of commercial arrangements and in the implementation of major corporate acquisitions, restructurings, mergers and financings and brings a deep understanding of the legal and corporate governance area. All of Messrs Oppenheimer, Lavoie and Thomas have first-hand management in the safety and health realms.
Our analysis of the inherent level of risk that the Corporation has with regards to staff being exposed to incidents of unacceptable and undesirable business interactions, over and above the avoidance of prohibited transactions, is assessed as low. Operating procedures require the settlement of all business being transacted with third parties or vendors to pass through the centralized accounting and administration function, which manages the establishment of vendors to whom settlement can be made and the sign–off by independent senior management of all payments to these external parties. Training was conducted in 2006, and in 2008 specialist auditors were engaged to consider whether the landscape had changed and whether this warranted further across the board training from external trainers. This was deemed unnecessary and training continued through internal leadership by management and revised practices following the implementation of a fully integrated enterprise resource planning system requiring financial, and supply chain procedures to be updated and specific roles and segregation of duties redefined. Furthermore, a new anti-corruption policy and procedure is being launched across the whole De Beers Family of Companies to coincide with new legislation in the United Kingdom. While the entire business in Canada was analyzed for risks including corruption, no specific analysis only for corruption was undertaken. Similarly, training of employees has been deferred until 2011 to coincide with the launch of the new policy and procedures.
The Total Rewards Package for the Executive consists of an annual base salary, perquisites, benefits and pension provisions, in addition to a Short-term Incentive Plan which is made payable upon achievement of company, departmental and personal objectives. The company objectives comprise financial and non-financial metrics.
Performance in 2010 was evaluated against the Short-term Incentive Plan measures and where achieved, payments were calculated and will be issued in 2011 subject to the approval of the Chairman and CEO of De Beers Family of Companies.
There is no Long-term Incentive Plan in place at present, however, plan design is underway through Group Executive Compensation.
Integral to the internal governance and management of the company, there is an internal ‘Code of Business Conduct and Ethics’ (revised in April 2008), which is available upon request, which all employees review during the hiring process. All employees are required to read and sign this as part of their annual performance appraisal at the year-end.
De Beers Canada Inc. - 2010 Report to Society 15
Each of the De Beers subsidiary companies is represented on the main De Beers Société Anonyme Board so that they may provide recommendations or direction to the Board of Directors. The De Beers Société Anonyme Board provides overall direction and recommendations to all parts of the De Beers Family of Companies, including De Beers Canada. Jim Gowans, President of De Beers Canada, sat on this Board on behalf of De Beers Canada in 2010.
The following includes a summary of the decision-making principles that guide how we delegate decision rights:• Final accountability for performance, and therefore full authority
for decisions is delegated to individuals (not committees) to give single-point accountability;
• Committees can approve, provide input or recommend. The De Beers Société Anonyme Board and the De Beers Société Anonyme ExCo (executive committee) retain decision rights;
• Decision-makers should seek input and recommendations from key individuals and only convene committees when absolutely necessary;
• Recommendations should include an evaluation of several alternative options but should always include the preferred option. If individuals wish to consider or decide on an option not included in the recommendation, they should ask the recommender to evaluate it first;
• Decisions are final. Individuals and committees must commit fully and visibly to supporting decisions once decision-makers have made them; and
• Decisions only deliver when implemented. It is important to deliver/implement decisions and hold the decision-makers accountable.
The relationship between our board, our parent and the various committees with Canada is summarized in the following chart:
DBsa Board
DBCI Board
DBCI Audit Committee
DBCI Executive Committee
DBfocExploration Operating Committee
DBCI Snap Lake Executive
Committee
DBCI Victor
Executive Committee
DBCI Exploration
Executive Committee
The above, coupled with regular risk assessments for all areas of our business, are used to ensure that a high standard of corporate governance is achieved and maintained so that we can provide confidence to our clients and communities of interest that we work with, that we work to high ethical and effective governance standards, and that these various elements are integrated.
De Beers Canada is a private company, with one shareholder, De Beers Société Anonyme. There are no minority shareholders. Several of the board members for De Beers Canada also sit on the boards for other related companies within the De Beers Family of Companies. These directors provide a direct conduit for information from related companies to flow to De Beers Canada. Information on the De Beers Family of Companies is available at www.debeersgroup.com. Employees are encouraged to provide feedback through their departmental managers or through the various mechanisms for continuous improvement and for suggestions.
DBfoc = De Beers Family of CompaniesDBCI = De Beers Canada Inc.DBsa = De Beers Société Anonyme
Students from the Mineral Process Operator Trainee program offered by Aurora College in Fort Smith, NWT, tour the process plant at Snap Lake Mine.
De Beers Canada Inc. - 2010 Report to Society 16
Management Approach - OperationsOur overall approach is to ensure we operate in a safe, healthy and environmentally responsible manner to maximize revenue and minimize expenses, bearing in mind that in doing this we have to do so in a way that makes a positive and lasting contribution to the communities in which we operate. This means that we have to balance the different aspects of our activities to find the optimal way forward.
Operating highlights
Table 1-5: 2010 Operations goals and objectives
Goal Degree achieved Successes Shortcomings Additional remarks
Snap Lake Mine:Resume ramp up, achieve carat target of 1,137,000 cts and 760,000 tonnes mined, and dilution 39%.
Tonnes mined +15%; carats recovered -13%;dilution 42%.
926,000 carats recovered from 855,000 tonnes mined.
Carat and dilution targets not met.
Victor Mine:continue operations and achieve carat target of 749,000 cts and 2,708,000 tonnes mined.
Tonnes mined -1%; carats recovered +4%.
826,000 carats recovered from 2,660,000 tonnes mined.
Target for tonnes mined, not met.
Gahcho Kué:Feasibility study completed.
Feasibility study essentially completed by year-end. Some minor issues to be closed out.
Feasibility study first complete draft submitted. EIS submitted to regulators at year-end.
Both the Snap Lake and Victor Mines continued operations successfully, albeit at a reduced throughput due to the economic downturn. Snap Lake produced 926,000 carats, and Victor produced 826,000 carats.
There are no small-scale manual diamond diggings (i.e. artisanal) or small-scale mining within either the Snap Lake or Victor areas of operations.
The process plant at Snap Lake Mine.
The process plant at Victor Mine.
De Beers Canada Inc. - 2010 Report to Society 17
This year was one in which an improving global economy allowed us to commence our careful ramp-up back toward full production, following the significant production curtailment we had put in place for 2009. We hired approximately 175 new employees and this hiring was substantially complete by the third quarter, and many employees who had worked for us in 2009 returned to work with us again at Snap Lake.
A significant achievement that is being enjoyed now by all our employees and contractors was the completion of our brand new permanent accommodations complex. The facility officially opened in December, and includes a new training centre, recreation and exercise facilities, a cultural centre and 400 new dormitory units. This project was part of a $48 million capital plan that also included the start of construction of the East Cell of the North Pile, our processed kimberlite containment facility.
In 2010, 926,000 carats of diamonds were recovered in the process plant, which is designed to handle up to 3,150 tonnes of ore a day.
There was a continued focus on safety throughout the year. Early in 2010, the Snap Lake Mine received the John T. Ryan Western Regional Safety Award from the Canadian Institute of Mining, to commend our
excellence in safety performance for 2009. Sadly, our safety performance decreased in 2010, although we were seeing improvements toward the end of the year.
An application to renew the mine’s Land Use Permit, which expires in May 2011, was filed in October, following significant community engagement activities to explain our plans and hear comments and concerns from residents in communities close to Snap Lake. The Mine’s water license is also set to expire in April 2012. Community engagement activities to explain water license application plans began late in 2010 and continued through the first quarter of 2011.
As Snap Lake moves forward, we remain committed to working safely, protecting the environment, and controlling costs, with the goal of reaching full production by the end of 2012.
Brad CorriganMine General Manager
Snap Lake MineNorthwest Territories
Snap Lake Mine.
De Beers Canada Inc. - 2010 Report to Society 18
Management Approach – Snap Lake MineThe approach for 2010 was to meet the production targets for tonnes and carats, to control working costs and to reduce dilution, all in a safe and environmentally responsible manner expected by our company and the community. To achieve our goals, a number of initiatives were developed and implemented, focusing on Best Practices. Work to reduce dilution and extend the reserves for the mine will contribute to maximizing the life of De Beers Canada and the life of its resources.
OverviewThe Snap Lake Mine is an underground mine. It is developed on a shallowly inclined kimberlite dyke. This dyke is about two metres thick, dips at average of 12 - 15 degrees from the horizontal. Access underground is via a portal and an incline. Ore is mined at a number of places underground, is crushed and then brought to the surface for processing by a conveyor. Information on the Snap Lake Mine can be found on our web site at www.debeerscanada.com. Production was increased in 2010 following the global economic slow-down in 2009.
Double shift operations resumed and production continued to increase throughout 2010 as we strived to reach full production by the end of the year. In order to do this, we focused on recruiting and training of labour and developing new areas underground. These initiatives positioned up for an increase production by providing our team the flexibility of multiple workings to avail of once we are in full production.
Production in 2010 totalled of 926,000 carats.
Table 1-6: 2010 Operations goals and objectives - Snap Lake Mine
Goal Degree achieved Successes Shortcomings Additional remarks
Snap Lake Mine:Resume ramp up, achieve carat target of 1,137,000 cts and 760,000 tonnes mined.
Tonnes mined +15%; carats recovered -13%.
926,000 carats recovered from 855,000 tonnes mined.
Carat and dilution targets not met.
Total mined target 1,060,000 tonnes. Actual 1,079,000 tonnes.
Target met.
Total ore mined target 760,000 tonnes. Actual 855,000 tonnes mined, +15%.
Ore mined target met.
Dilution target 39%. Not achieved. Actual 42%.
Total target treated 789,000 tonnes. Actual 869,000 tonnes processed, +10%.
10% more tonnes processed than planned.
Recovery target 1,137,000 carats. Recovered 926,000 carats: target not achieved.
-13% below target.
A Bolter Operator hard at work underground at Snap Lake Mine.
De Beers Canada Inc. - 2010 Report to Society 19
Building on the strong foundation since the opening of the Victor Mine almost three years ago, 2010 saw the mine increase output and reduce costs while undergoing a significant change to the senior management team, including my new role as General Manager. In all, five of the nine senior management positions saw changes in 2010 as career development continued. The team pulled together to focus on safety, best practices and finding efficiencies while developing the abilities of those at the mine to step up to the next level.
While production has been consistently delivering, we are not satisfied with our internal safety performance of the past year. Large, complicated tasks are being carried out extremely well with minimal safety concerns, however our collective performance on the routine-day-to-day tasks was disappointing as the number of first aids and medical aids – minor as they may be – is unacceptable. An aggressive ‘Near Miss/Near Hit’ reporting program was put in place in the second half of 2010 and a noticeable improvement in safety performance followed. Increased commitment to safety will be a priority as we move forward.
Continuous improvement in our operations is essential for Victor, which despite its output, is a relatively small mine with a short life-of-mine
compared to most other mining operations. As we work on responsibly developing Victor with our community and business partners, the mine is also supporting the work being carried out by De Beers Canada Exploration on extending the life of the mine, which is even more challenging in a remote environment with limited access to targets and increased working costs.
Our work in the communities continued to be a major focus in 2010 and we’re pleased to report a new milestone regarding business capacity as the first wholly-owned business contract for our local First Nation communities was put in place in 2010. We all shared in the excitement of that accomplishment and will continue to work together with our community and business partners to maximize the opportunities that come from the Victor Mine in 2011 and beyond.
Rory Greyvensteyn,Mine General Manager
Victor MineOntario
Victor Mine.
De Beers Canada Inc. - 2010 Report to Society 20
Management Approach – Victor MineThe approach for 2010 was to meet the production targets for tonnes and carats in a safe and environmentally responsible manner, to control working costs. A number of initiatives were planned and implemented to help us achieve this. Work to reduce dilution and extend the reserves for the mine will contribute to maximizing the life of De Beers Canada and the life of its resources.
OverviewThe Victor Mine is an open pit excavated into kimberlite. The kimberlite is present as two roughly carrot shaped bodies that pierce the surrounding rocks which are mostly limestone. Both the limestone and the kimberlite are covered by a series of sediments deposited by the glaciers, and then capped by muskeg, which forms a wet peatland. The overburden is removed and stockpiled for later use during rehabilitation at the end of
operations; the overlying glacial sediments are removed and stored in waste piles, and the kimberlite is broken by drilling and blasting, and is then loaded into trucks and transported to the processing plant where the diamonds are extracted.
Commercial production commenced on August 1, 2008, and a total of 826,000 carats was recovered during 2010.
Table 1-7: 2010 Operations goals and objectives - Victor Mine
Goal Degree achieved Successes Shortcomings Additional remarks
Victor Mine:continue operations and achieve carat target of 749,000 cts and 2,708,000 tonnes mined.
Tonnes mined -1%; carats recovered +4%.
826,000 carats recovered from 2,660,000 tonnes mined.
Target for tonnes mined, not met.
Total mined target 8,339,000 tonnes. Actual 9,612,000 tonnes: +8%.
Stripping was advanced during the period in the summer while planned maintenance took place on the plant.
Total ore mined target 2,780,000 tonnes.
Actual 2,660,000 tonnes: -1%.
Total target treated 2,631,000 tonnes. Actual 2,773,000 tonnes.
Tonnes treated on target.
Recover target 749,000 carats. Actual 826,000 carats: +4%.
Material from the halo between the payable and unpayable ore containted more carats than anticipated.
Surveying within the open pit at Victor Mine.
De Beers Canada Inc. - 2010 Report to Society 21
Gahcho Kué ProjectNorthwest Territories
Management Approach – Gahcho Kué ProjectThe approach for the Gahcho Kué joint venture is to work with our partner, Mountain Province Diamonds Inc through the Environmental Impact Review process, and to complete the review and approve the feasibility study. This involves ensuring good management of all the technical aspects to ensure reliable results as well as regular communications and relations with the communities of interest for the project. A complete positive feasibility study, followed by successful environmental assessment and permitting will lead to a new mine and help contribute to maximizing the life of De Beers Canada and the life of its resources.
The Gahcho Kué Project is a joint venture between De Beers Canada (51per cent) and Mountain Province Diamonds Inc. (49 per cent).
The majority of the year was spent in compilation of data for the feasibility study and for an environmental impact statement.
In December 2010, Mountain Province Diamonds published a Technical Report for the project which established the mineral reserves estimate for the property in accordance with National Instrument 43-101. The Gahcho Kué Project completed a feasibility study in October of 2010, and this is currently in review prior to finalization. The Environmental Impact Statement was completed and was submitted in December of 2010 to the Mackenzie Valley Environmental Impact Review Board.
A total of 447,132 hours of work have been completed for the Gahcho Kué Project without a lost time injury or reportable environmental incident.
With the completion of a feasibility study during 2010, the project has now migrated from the exploration division to the mining division.
Table 1-8: 2010 Operations goals and objectives - Gahcho Kué Project
Goal Degree achieved Successes Shortcomings Additional remarks
Mountain Province to complete feasibility study.
Feasibility study undertaken.
Study essentially complete. The study is under review awaiting finalisation early in 2011 .
File environmental impact study before end of 2010.
Achieved. EIS submitted 23 December 2010.
Waiting for MVEIRB to complete conformance check with terms of reference, and advise of any deficiencies.
Gahcho Kué Project
De Beers Canada Inc. - 2010 Report to Society 22
Exploration
Management Approach – ExplorationExploration uses a multi-faceted approach to finding and evaluating new resources for the corporation, including the use of new technologies. We undertake research of potential target areas, plan exploration programs and then implement these programs. We exercise strict cost controls and monitor the quality of the work undertaken to ensure reliable results. We review past results periodically in the light of new information and technology, and re-evaluate old areas to increase the probability for identifying and proving new resources. We also continuously review our approach to access to land and seek ways to improve.
The success of our exploration programs is very important for the long-term growth and survival of the company. It is the main source of new resources and reserves. Work to increase reserves are primary drivers to increase the value and life of our resources.
The Exploration Division of De Beers Canada has a combined environmental, health and safety management system. The environmental component is certified to ISO14001, while the health and safety section is conformant to OHSAS 18001, and now will be registered during 2011
Table 1-9: 2010 Operations goals and objectives - Exploration
Goal Degree achieved Successes Shortcomings Additional remarks
Complete a program of 6 large diameter drill holes on Tango Extension and recover bulk samples for preliminary assessment of kimberlite.
Mostly achieved. 4 holes completed as planned; 1 hole stopped short because of onset of spring thaw. 1 hole not drilled. Drilled 5 holes totalling 1,173m and recovered ~800tonnes kimberlite.
Late start due to delay in permit approval. Early closure of winter road due to mild weather.
Results from program pending from laboratories.
Complete a program of core drilling to better delineate Tango Extension.
Achieved. 11 holes totalling 2,039m completed.
Complete a program of core drilling to better delineate Delta-1 internal geometry and provide micro-diamonds for assessment of this kimberlite.
Achieved. 8 holes totalling 1,662m completed.
Drill program was an addition to 2010 work plan.
Undertake preliminary scout sampling in selected areas to check previous sample results.
Achieved. Scout programs completed. Results pending from laboratories.
Covered drill rigs on the ice at Kennady Lake.
De Beers Canada Inc. - 2010 Report to Society 23
when the rest of De Beers Canada is registered to the system. The scope of this combined management system includes processes associated with diamond exploration including office activities, sediment sampling, drilling, geophysics and sediment and bulk sample processing.
The management system underwent external surveillance audits in 2010 for our field operations within the Victor Resource Extension project, the Sudbury Sample Treatment Plant and the Toronto Exploration Office. In addition, there was a recertification audit for the Sudbury facility. There was a series of internal environmental audits at all of these exploration facilities as well. There were no major findings associated with these audits. For health and safety, there was one external Stage 1 audit for OHSAS18001, and internal audits for the Victor Resource Extension project, Toronto and Sudbury.
There was one non-compliance issue relating to taking water in excess of a permitted daily volume for winter road construction where a local sub-contractor failed to abide by permit requirements. The issue was not detected for several days because the sub-contractor and contractor were delinquent in the reporting. Subsequently, operating practices have been modified and this should prevent a repetition.
Exploration work was focused around the Victor Mine to systematically explore the other kimberlites and determine their potential as additional resources for the Victor Mine because the Victor Mine life is very short (anticipated closure in 2019). Work was undertaken on the Tango Extension and Delta-1 kimberlites. Small diameter core drilling, and ground geophysics were completed. Material collected at Tango Extension by large diameter drilling for macro-diamond evaluation was treated at the sample plant at the Victor Mine, and the diamonds recovered are currently being evaluated. Delays in permitting caused the planned large diameter drilling program to be stopped after only four of the six planned holes had been completed and a fifth hole was partially drilled and stopped about 100 metres short of its planned depth.
A helicopter slings a small boat to a lake near the Gahcho Kué Project as part of environmental baseline studies.
De Beers Canada Inc. - 2010 Report to Society 24
Management Approach - RiskBy recognizing where our risk areas lie, we can take steps to reduce these risks and thus increase the probability of activities proceeding well without mishap or interruptions, and more importantly ensure the health, safety and wellbeing of our employees, the environment and the public. If an issue has the potential to significantly affect or impact risk, then it is material to the corporation.
IntroductionFull risk assessments are undertaken by De Beers Canada. Each mine and each department undertakes risk assessments at least twice a year and in most instances, these are updated quarterly. A common risk assessment template and set of risk assessment criteria are used across the company. All risk assessments are reported to the De Beers Canada Board and to the main Board of Directors for De Beers Société Anonyme. Risk assessments and analyses are used to highlight areas of concern that could materially affect the operations of the mines or the exploration projects, our employees and the communities in which we operate. These risk assessments include adherence or compliance with international agreed standards, codes of conduct and principles that are applicable to us. The risk assessment findings help us identify mitigation steps to reduce the risk to our activities, and to provide alternatives for different risk scenarios.
The company’s rigorous risk assessment process assesses the existence of all internal and extraneous factors that could undermine the company’s ability to meet its strategic objectives. These objectives fall under the broad aspirations of value growth, reputation protection and being a centre of excellence. Specific attention is directed towards the security of the diamond product and as a result, a holistic assessment is undertaken separately for the high risk areas of the mines specifically considering the potential incidence of corruption and what controls are required to mitigate the company against any inherent risks. The physical sections of the operations and ancillary offices that are considered less risky from a product security perspective were the subject of a more detailed risk assessment by a Diamond Control and Security Effectiveness Review undertaken by the De Beers Group Services in October 2010. The final report was still pending at the year end. The risk of corruption is included within the general assessment of risk within the lower risk areas of the mines and in the offices and these were reviewed during more detailed risk assessments during 2010.
In order to manage risks effectively, each department on each mine and in the corporate office and exploration division undertakes a detailed
risk assessment using a common methodology. The risks are initially assessed and ranked within a matrix to provide an “inherent risk”. The “inherent risk” is the original risk before any controls or mitigation steps. The risk assessment is then adjusted after consideration of existing risk management strategies and controls to reach a “residual risk”. This residual risk in turn is then considered, and additional mitigating strategies and controls are considered to provide improvements through consideration of what could be done, by who and when. The outcome of this third step is a “remaining risk”, The remaining risk is what is left over after all the controls and mitigation steps that can be usefully employed are in place, and is used as the basis of the final risk assessment. Revisions of the risk assessment are undertaken at least every six months, and usually every quarter where risks are significant.
In the environmental area, for example, risk assessments are used to highlight priority areas for management plans and controls to reduce or eliminate the likelihood of minor, moderate or major environmental incidents. The risk assessments also assist in identifying opportunities for continuous improvement regarding responsible environmental behaviour. Examples of such behaviour include the reduction and re-use of material consumption, reduction of energy consumption and related emissions that could negatively affect climate change. Similarly, risk assessments of our communities of interest are used to identify potential areas where proactive or remedial action is required to increase two-way communication and understanding of our operations in order to reduce any misunderstandings or perceptions of on-going or future business plans. In general, we use the precautionary principle to guide the way we plan and undertake our activities across the company.
Similarly, risk assessments for other areas of the company are used to provide information on critical areas that warrant special attention. By focusing on these areas, we are able to adapt our way of carrying out our business so that both the likelihood of an event occurring, and also the severity of any incident are reduced.
At Snap Lake, work is continuing to find more effective ways to reduce the total dissolved solids content of effluent. Progress was made in the area of total dissolved solids concentrations. Several initiatives are currently underway to develop an effective management program that will proactively address a forecast increase during the later years of the mine life. Regarding the ramp up to full production at Snap Lake, the team is refocusing on new development and other efficiencies in 2011 that will help position the mine for a reaching their full production target.
Risk assessment
De Beers Canada Inc. - 2010 Report to Society 25
Table 2-1: Major risks and opportunities for De Beers Canada as at 31 December 2010
Risk Opportunity
Snap Lake Mine and Victor Mine
Unfavourable exchange rates between the Canadian and US dollars (i.e. Canadian dollar near or at parity).
Greater efficiencies; tight cost controls; improvements in technology and processes.
Limited access to or no winter road (i.e. poor weather).
Increase stocks of consumable materials at site including fuel, pursue opportunities to reduce consumption of consumables.
Snap Lake Mine Total dissolved solids (TDS) level exceeds water licence parameters.
Close monitoring of TDS and complete hydrological studies to better understand changes in TDS levels and identify better methods to reduce TDS level in effluents. This risk has decreased since 2009, but may well increase later in the mine life.
Inability to ramp up to full production after the downturn because of a shortage of skilled employees.
Attract, recruit and retain skilled employees.
Inability to reduce excessive dilution. Increase run of mine grade and recovery through reducing dilution by reducing mining country rock.
Victor Mine Civil disobedience / unrest closing winter road to site or interrupting power supply.
Increased community engagement and more effective communications.
Exploration Inability to gain access land for exploration because of unresolved issues between Aboriginal communities and government, or Aboriginal communities and De Beers results in longer timeframes for discovery and resource definition.
If access to land is obtained, this would be a strategic lever for success in growing the company.
Uncertainties with the permit approval process and the new Mining Act amendments and Far North Act in Ontario create uncertainties and delays in work programs.
Discussions with Ministry of Natural Resources and First Nation personnel allow for clear understanding of process and streamlining of process going forward.
Lower funding level following the economic downturn result in longer timeframes for discovery and resource definition.
Accelerated funding would help move projects forward faster and any discovery would thus have a shorter timeframe to reach a defined resource.
De Beers Canada Inc. - 2010 Report to Society 26
Risk and Climate ChangeThe risks to both our mines associated with the winter road access are a concern because of climate change. Mitigation efforts are focused on ways to reduce the dependency for fuel and other consumables. While most consumables are difficult to reduce, studies are underway to use wind power to reduce the fuel required for power at site, and thus reduce the volume of fuel needed annually. The implications of climate change for both the Snap Lake and Victor Mines are identified as significant risks for both mines because both are serviced by seasonal winter roads for a short time each year. These winter roads are dependent upon temperatures being low enough for significant freezing to build an adequate ice base and sufficient snowfall to permit road construction and smoothing out of the winter road surface so that it is not too rough for vehicular traffic. If the climate is too warm for winter road construction, if there is insufficient snowfall, or if the winter road season becomes too short, the alternatives are (i) to build permanent roads, which is considered to be cost-prohibitive; (ii) to move all consumable spares and equipment by air; or (iii) to build a road less frequently in those years that are cold enough. The difficulty with this third alternative is that weather forecasting is not good enough to tell in advance whether or not the winter will be cold enough to freeze hard or have enough snow. The cost implications of both of the second and third alternatives are being monitored. The airstrip at Victor is being completed to its full designed and permitted length so that it can accommodate a large aircraft in case the need arises. However, there are some pieces of equipment that are too large to be moved by air, and other alternatives are being considered for these. Supply by air is estimated to be at least twice the cost of supply by road or more. The second alternative would result in increased costs for keeping larger stocks of consumables at site, and it does not address the issue of how to resupply the sites if there are warm winters for several years running.
Additional climate change risks include litigation risks, regulatory risks and reputational risks. Currently litgation risks are low because there is little relevant legislation linked to climate change. Emerging issues around carbon targets and carbon trading could result in a risk. However, this is not quantifiable at present. Similarly, regulatory risks are low and these are expected to evolve and grow if and when regulations are promulgated for carbon emissions.
A greater risk is a reputational one if we are not seen to be acting both proactively and responsibly to the issues related to climate change and to greenhouse gas emissions and our efforts to reduce our energy footprint. In this regards, our steps to investigate alternate energy sources and energy conservation must be reported to our communities of interest so that they can see that we are addressing this important issue.
The flags of Canada, the Northwest Territories, and De Beers Canada fly at an exploration camp.
De Beers Canada Inc. - 2010 Report to Society 27
Formal stakeholder identification and mapping exercises are undertaken for each project and for each mine to identify our Communities of Interest (COI). It is also required for the External Relations component under the Towards Sustainable Mining initiative. These exercises are reviewed regularly to ensure that the identified stakeholder lists are accurate and complete. Stakeholders or COI, are those communities or organizations that have a business or public interest in our activities, or may be affected in some way by our activities.
The external stakeholders include but are not limited to the communities close to and around the two mines, and those communities on whose traditional lands exploration activities are undertaken; the federal, provincial and territorial governments of the jurisdictions where the company is active are also stakeholders, as are interested non-government organizations, the business community, media and the general public.
Internal stakeholders are considered to include all employees, contract and business partners on site, shareholders and the De Beers Family of Companies.
Using the Guidelines for External Relations, for Towards Sustainable Mining, we are also reviewing our stakeholder list with current COI to ensure we identify other relevant stakeholders we may not be aware of at this time. A list of the main communities considered to be stakeholders is included in Table 6-3.
For additional information on COI and stakeholders, please see the community section.
Stakeholder engagement
Sponsored in part by De Beers Canada, Aboriginal youth take part in Dene Hand Games during a tournament in Behchoko, Northwest Territories.
De Beers Canada Inc. - 2010 Report to Society 28
Investment in people and infrastructure
Management Approach – Investment in people and infrastructureFollowing dialogue with our communities of interest (COI), our focus in 2010 was on education and youth with an emphasis on literacy, and on general community development. Lesser amounts were spent in other areas. This reflects not only what we heard from our communities of interest, but also the availability of resources to meet the requests we received. We have deliberately avoided providing infrastructure, particularly where this is the responsibility of government, and we have focused on those areas where community investment would have the greatest impact on a substantial number of community members rather than on a few individuals. We continue to focus on programs that reflect “a hand up” rather than “a hand out” with the rationale that this should help contribute to sustainable communities through building skills, self-confidence and pride. Communities are unique, and because of this, our approach has to be flexible in order to accommodate this.
Corporate Social InvestmentCorporate social investment by De Beers Canada has been and will continue to focus on our COI. Each operation is responsible for identifying their local COI, which includes but is not limited to local communities, our business partners and industry partners.
The main priority for De Beers Canada will continue to be our local Aboriginal partners with whom we have Impact Benefit Agreements in place. Through joint discussion, it was determined the focus in this early stage of development and operations will include:
Disbursements in 2010 totalled $5.9 million including cash, in-kind and staff time. Each community has individual needs and as such, each decision regarding corporate social investment is made accordingly.
Table 3-1: 2010 goals and objectives - Corporate Social Investment
Goal Degree achieved Successes Shortcomings Additional remarks
Align corporate strengths with community needs and priorities for social investment.
Objective largely achieved.
Focus was on education, Youth, and general community development.
Many community priorities and needs are beyond our abilities because we do not have the resources (people, skills, funds) to address them.
Payments under IBAs almost doubled corporate social expenditure.
Maintenance work at the exploration camp site
(i) health,(ii) education and youth,(iii) environment,(iv) general community
development,
(v) arts, culture and heritage,(vi) housing,(vii) policy and advocacy,(viii) small business development, and(ix) sports.
De Beers Canada Inc. - 2010 Report to Society 29
Hea
lthEd
ucat
ion
and
Yout
h (L
itera
cy)
Envi
ronm
ent
Gen
eral
Com
mun
ity D
evel
opm
ent
Art
s, C
ultu
re a
nd H
erita
gePo
licy
and
Adv
ocac
ySm
all B
usin
ess
Dev
elop
men
tSp
orts
Oth
er (I
nclu
des
over
all s
taff
tim
e)
$ 3,072,280 Education and youth (literacy)
$ 69,105 Health
$ 760 Environment
$ -- Small business development
$ 569,200 Other (includes overall staff time)
$ 15,370 Sports
$ 28,723 Policy and advocacy
$ 65,716 Arts, culture and heritage
$ 2,112,566 General community development
Total CSI Spend$5,933,200
In addition to the above, $5,231,000 was paid to the eight communities in terms of the different impact benefit agreements.
In the on-going discussion with the communities in which we operate, De Beers Canada has targeted a number of specific initiatives to address building capacity through business opportunities for the supply of goods and services, employment and training (including education). These initiatives have been chosen because these are the areas that these communities of interest have indicated are priorities for them. In addition to these priority areas, limited support is given from time to time in other areas that are of lesser priority but which also contribute to sustainable communities and community well-being.
Sustained contribution through diversificationOne of the strengths of the De Beers Canada labour force is the diversity of its workforce. The variety of nations represented provides many different views and approaches to problem solving that are stimulating for all involved. This enables the company to integrate local traditional ecological knowledge (TEK) into our planning and project design. Incorporation of both traditional and “conventional western science” ensures that we arrive at an optimal design for our mines and our exploration projects.
Stakeholders, or COI, are identified as outlined below in the community section.
Traditional knowledge in the areas where we work is a tremendous asset and important tool in the success of our environmental management. Incorporating the knowledge and experience of our Aboriginal partners into the planning and execution of our environmental initiatives increases the effectiveness of the initiatives and ensures our community partners are involved throughout the process. We have learned a great deal from our aboriginal partners and have a tremendous respect for their commitment to work collaboratively to ensure our mines provide economic and social benefits in an environmentrally sustainable way.
For more information, please see the employee section.
ExplorationThere is still one unresolved issue from 2006 involving Muskrat Dam First Nation. This relates to exploration activities at Agusk Lake, where the First Nation asserts interference with its traditional spring hunt. The First Nation has refused to meet with De Beers Canada to discuss this, and has also refused to indicate where its traditional lands are located. There has recently been a change in leadership in the community, and efforts will continue to try and resolve this matter.
Feedback from communities and external stakeholdersA formal corporate-wide feedback mechanism was put in place in December 2010 in accordance with External Outreach requirements under the Towards Sustainable Mining initiative of the Mining Association of Canada. It solicits feedback from the general public and identified COI, including Aboriginal communities located close to the company’s mine sites. The various IBAs with our Aboriginal partners contain provisions for a Senior Implementation Committee, which acts as a formal feedback mechanism for those communities . In addition, public community meetings and Question & Answer sessions are used for formal feedback. Both mine sites were in a continuing state of change related to the changing economy. Plans for a 2010 implementation of a formalized community engagement system for COI and the community at large were nearing completion at the end of the year with approval and implementation expected in Q1 2011.
The Snap Lake Mine implemented a formal community engagement program in 2010 in advance of submitting its application for a new land use permit with the Mackenzie Valley Land and Water Board (MVLWB) in the autumn. This engagement program included meetings with leadership, presentations, publication and distribution of materials relating to the company’s use of the land, information sessions and site visits. Four delegations from Aboriginal communities visited the mine during the summer. A summary of this engagement program was supplied to the MVLWB, which included a summary of the concerns and questions raised by communities and the company’s response to these. This is available on the MVLWB Public Registry. While most communities had questions and suggestions, no major concerns were raised regarding De Beers’ management of its land use, two Aboriginal communities raised concerns that other groups have IBAs and they do not.
Figure 3.1: Corporate social responsibility spend in 2010
De Beers Canada Inc. - 2010 Report to Society 30
In 2010, De Beers provided annual reports to each of the communities with which it has IBAs for the Snap Lake Mine. The company has offered to review these reports with the communities directly, however communities have not taken the company up on this offer. In some communities, capacity has continued to be an issue with respect to community participation in the implementation of those agreement aspects that require community and company to work together.
At Victor, similar issues occurred. Dialogue also included concerns by a segment of the community and environmental non-governmental organizations about a potential issue related to release of pre-existing mercury in the local muskeg. When water is removed from muskeg either through natural causes such as dry weather or drought, or through a dewatering program often used in mining, mercury that has accumulated in the muskeg may be released. A subsequent uptake of this mercury by fish could endangering the local food chain. The matter was considered during the federal Environmental Assessment for the Victor Mine and was found not to be a significant issue. In the interests of public health, wellbeing and safety, a five-year research program began in March 2008 to confirm whether or not this is a significant issue. This program is being funded by De Beers Canada ($1.4 million) and by a Natural Sciences and Engineering Research Council of Canada (NSERC) grant ($968,000) over the five-year duration. Results to date support the Environmental Assessment (see environmental section for more details). The background for this study is that there is a naturally-occurring pre-existing high mercury content in the river water. The results to date (June 2010) appear to indicate that the change in concentration of mercury after adding mine waters is so small that it is less than the accuracy of the instruments taking the measurements. Large, and thus older, fish contain high naturally occurring mercury concentrations and it is recommended that these large fish not be eaten. Smaller, and thus younger, fish do not contain high levels of mercury.
Under the IBA with Attawapiskat, two annual community meetings are held jointly with the members of the Senior Implementation Committee from both the First Nation and the company to provide feedback to the community and to listen to what the community has to say. One community meeting was held in the spring. The second meeting was held mid-year. A variety of other meetings were held with the community to address different issues. Difficulties persisted through most of the second half of the year in holding meetings with the community membership in Attawapiskat. Attempts to reconvene were unsuccessful due to repeated postponement of meetings by the community while it dealt with a variety of other higher priority issues. This adversely affected the company’s ability to provide information
to the community members in a timely manner. However, a “trades show” was held in the community in mid-November to highlight what skills are used on the mine by the various departments, and what each department actually does. This show was well received by the community. Alternative methods for keeping the community informed included delivering information through a newsletter, a local television community channel and over the regional radio station.
Key stakeholders take a tour of the process plant at Victor Mine.
De Beers Canada Inc. - 2010 Report to Society 31
Management Approach - EconomicsEconomics goes farther than merely considering the financial figures. We look at what is behind them, and what are the key factors contributing to them. We ask ourselves “Are there specific factors that either add value, or diminish it? How do we recognize these and what do we do about them?” One of the key factors contributing to the economics of a deposit is the value of the product. We take a lot of care to preserve the value of the diamonds we mine through undertaking the best recovery of diamonds that we can during the processing of ore to minimize diamonds being lost with the waste products, and also to minimize breakage of the diamonds themselves. Breakage could vary from shattering of individual crystals to chipping off small portions, both of which negatively affect the value and thus ultimately the revenue. Part of our internal due diligence in our processing plants is thus aimed at monitoring and minimizing losses to the value through breakage. The costs of operations themselves and the various overheads incurred by the offices are monitored and managed with care as well because these expenses also affect the overall value realized. Regular cost reviews and monitoring of revenue from sales against expectations help us to ensure that all reasonable steps are being taken to maximize the value of our product.
De Beers Canada contributes through its own two mines (Snap Lake and Victor) to both the economics of the De Beers Family of Companies and to the socio-economic wellbeing of Canada, particularly in Ontario and NWT where our mines are located. The economic recovery that started in 2009 continued through much of 2010. In gross terms, we employed 1,087 people and injected approximately $474,900,000 into the Canadian economy in 2010. At Snap Lake, about 26 per cent of our work force is Aboriginal and at Victor, about 40 per cent. The salaries and wages for these individuals should flow to their communities, provided the individuals are still resident there. This financial contribution was through our operating costs, capital purchases and salaries and wages (for details, see Figure 4-2). Within this total, the breakdown into benefits from the purchase of goods and services from Aboriginal and northern suppliers is summarized in Figure 4-1. All of the production from both the Snap Lake Mine and the Victor Mine was purchased by the Diamond Trading Company (DTC) which is part of De Beers UK; 10 per cent of the carats by value from Snap Lake were offered for sale to local Canadian sightholders in the NWT for cutting by local sight holders under an agreement between De Beers Canada and the government of the NWT. A similar arrangement is in place for Ontario whereby 10 per cent of the carats by value from Victor were offered to sightholders for cutting under an agreement between De Beers Canada and the government of Ontario. Prices for rough (uncut) diamonds have returned to pre-recession levels and the demand for DTC sales in general has picked up. As rough prices
recovered, the polished prices have remained fairly consistent. Many additional steps were taken to reduce and contain costs and conserve cash to ensure that the company remains in good shape for the future.
Table 4-1 shows the economic goals for 2010, and summarizes the main successes and shortcomings. The major risks and opportunities for the company are summarised in Table 2-1. The economic goals remained essentially unchanged throughout the year although plans were in place to adapt to the changing economic circumstances if necessary. Note that all financial figures are rounded to the nearest thousand dollars. All amounts are in Canadian dollars, unless noted otherwise.
Economics
At Snap Lake Mine, a Jumbo drills holes in preparation for explosives.
De Beers Canada Inc. - 2010 Report to Society 32
Table 4-1: 2010 economic goals and objectives
Goal Degree achieved Successes Shortcomings Additional remarks
• EBITDA $94M• Free Cash Flow $5M
Achieved. • EBITDA = $128.8M,• Free Cash Flow actual
= $50M
Successful Execution of Victor Resource Extension Plan
Achieved. 4 holes completed to their planned depth, 1 hole was stopped about 100 m short because of the spring thaw.
Late arrival of permits caused the program to be modified from 6 drill holes to 5: 4 holes were completed, and one was stopped prematurely because of the onset of spring.
Some results for this work are still awaited.
Gahcho Kué: Positive feasibility study
Achieved. Gahcho Kué feasibility study positive and robust.
A few items remain to be closed out and these are not expected to significantly change the viability.
Safety LTIFR 0 LTIFR = 0.88 LTIFR = 0.88
Environment AEIFR 18.5 or better Achieved. AEIFR = 7.1
Talent Management program implementation by end of Q4 2010.
Gap analysis complete by end of Q4; plan in place for 2011.
Objective met.
Snap Lake• Carat target: 1,137,000• Safety LTIFR: 0• Dilution less than 38%
Not achieved. • 926,000 carats recovered;
• LTIFR = 1.1;• Dilution 42%
Issues with dilution and safety; carat recovery for the year not met.
Victor• Carat target: 749,000• Safety LTIFR: 0
Carat target met. LTIFR not met.
• 826,000 carats recovered;
• LTIFR = 0.64
De Beers Canada Inc. - 2010 Report to Society 33
Snap
Lak
e M
ine
Vict
or M
ine
Expl
orat
ion
Corp
orat
e
$ 119,106,000 Snap Lake Mine $ 104,194,930 Northern Expenditure1
$ 48,062,961 Aboriginal Expenditure2
$ 13,747,000 Corporate
$ 12,087,000 Exploration
$ 92,827,000 Victor Mine $ 49,070,000 Aboriginal Expediture3
Total Expediture$237,767,000
Notes1. Northern Expenditure for the NWT is included in the total expenditure.2. Aboriginal expenditure for the NWT is included in the Northern expenditure.3. Aboriginal expenditure is included in the total expenditure for Victor.
All contracts were paid in accordance with agreed terms, excluding any agreed penalty arrangements.
Total payroll and benefits, including wages, pension, and other benefits, consisted of $14,770,887 for the corporate and exploration divisions, $1,080,439 for Gahcho Kué, $59,273,309 for Snap Lake and $47,449,993 for Victor for a grand total of $122,574,628 for Canada. In addition, redundancy payments were made totaling $138,049 during 2010. Out of the 1,087 employees only 37 are within a defined benefit plan and this is not material for this report. The decision was taken during 2009 to freeze the defined benefit plan from December 2010, with all non-retired employees of the defined benefit plan then becoming members of a defined contribution plan beginning January 2011.
No corporate, federal, provincial taxes or government royalties other than personal income taxes were paid in 2010 as the company was in a loss position for tax purposes. In future years there are accumulated tax allowances from exploration, development and construction phases that will reduce tax payments for a while. A total of $26,044,637.59 was paid in federal and provincial income taxes on the payroll, Canada Pension Plan contributions and employment insurance. Property taxes (including land use payments) totalled $4,887,000 during the period. No federal, provincial or territorial subsidies were received during the year. Figure 4-2 shows the contribution to date to the economy.
No investment was made in public infrastructure through any commercial, in-kind or pro-bono engagement
Legend:
Contribution through purchases of goods and services
Contribution through capital purchases
Contribution through salaries and wages
De Beers Canada Total ($ millions)
50 100 150 200 250 300 350 400 450 500
Snap Lake Mine ($ millions)
50 100 150 200 250
Victor Mine ($ millions)
50 100 150 200 250
Gahcho Kué Project ($ millions)
1 2 3 4 5 6 7 8 9 10 11 12
Corporate and Exploration ($ millions)
10 20 30 40 50
Figure 4-2: Total contribution to the economy in 2010
Figure 4-1: Total contribution to the economy in 2010
De Beers Canada Inc. - 2010 Report to Society 34
Management Approach – Financial highlights:Accurate recording and compilation of financial information are required in order for us to understand the financial state of the corporation, and also for us to plan and forecast what is likely in the future. Linked to this is a rigorous internal audit function, reinforced by external audits by independent third parties to ensure that we are functioning in a legal and compliant manner, and to provide the necessary checks and balances that any corporation requires. Part of our operating system is to reduce the use of cash within the company, and to centralize the collation of invoices and statements and to use a centralised payment system to the extent that it is practical. This reduces the risk to the company and lowers our vulnerability to some aspects of crime.
Financial SummaryDiamond production during the period was 1,751,000* carats made up of 926,000 carats from Snap Lake, and 826,000 carats from Victor. Total net receipts from the sale of 1,661,000 carats to the Diamond Trading Company were US$446,020,000. The difference between the carats produced and the carats sold represents the change in diamond inventory on hand during the period.
Pension and benefit payments included in Table 4-2 totalled $8,693,700.
Financial highlights
Table 4-2: Financial highlights as at 31 December 2010.
($ thousands)
Revenues 460,711
Operating Costs (excluding wages) 218,787
Employee wages and benefits 106,839
Operating Assets Amortization 93,058
Payments to Providers of Capital 71,286
Payments to Government 34,525
Non-Operating Costs (excluding wages) 16,828
Employee wages and benefits 19,991
Non-operating Assets Amortization 942
Table 4-3: Distributions to providers of capital
($ thousands)
Interest on debt and borrowing 15,068
Re-financing fee 4,280
Net debt repayment 51,938
Note: Net debt repayment: $69,709,000 repayment of bank loan less $17,771,000 increase in intercompany payable balance.
Table 4-4: Other distributions
($ thousands)
Dividends on shares --
Dividends of preferred shares --
Arrears of preferred dividends --
Indirect economic impacts to the economy in general have been estimated by the Mining Association of Canada as being over 60 percent more than the direct economic impacts.
Four Impact Benefit Agreements are in place for the Snap Lake Mine, and there are three Impact Benefit Agreements and one Working Relationship Agreement in place for the Victor Mine. Each agreement is slightly different, reflecting the needs and priorities of the individual groups. Total payments to all eight Aboriginal communities with ratified and signed Impact Benefit Agreements and including the Working Relationship Agreement totalled $5,231,000 during 2010. These payments include components for compensation, environmental monitoring, scholarships and the like, but exclude financial benefits related to business opportunities through the supply of goods and services.
A convoy of trucks deliver loads up the winter road in northern Ontario.
* Errors due to rounding
De Beers Canada Inc. - 2010 Report to Society 35
Management Approach - EthicsAt De Beers Canada, we believe responsible, ethical practices form the backbone of a company. In maximizing the value and life of our resources, we consider not only the value in dollar terms, but also the value to our various local communities and other stakeholders. While the life of the mine is important, we plan and operate in a way that looks to achieve a balance between economically mining the ore and maximizing employment, business and other opportunities for our Communities of Interest.
In Canada, we focus on the actual life of mine that begins in exploration and moves through production and then onto the sale of our product to the downstream part of the diamond pipeline. The downstream industry specializes in the cutting, polishing and retail portion of the diamond pipeline. Most of the production from the Victor Mine is gem, or near gem, quality and is destined for jewellery. The production from Snap Lake Mine contains not only gem and near gem diamonds, with the same end uses, but also diamonds destined for industrial applications. The life of these rough diamonds, once cut, can be as long as the life of the piece of jewellery it is placed in, unless the stones are re-cut or remounted. The life of diamonds with industrial applications is often dependent upon the wear of the diamond in its specific application. Our related companies further along the diamond pipeline play a significant role in these downstream aspects of the life of the resource.
Our management systems, policies and procedures guide our behaviour and our ethics at each stage of the diamond pipeline, while our Best Practice Principles measure how we do. We comply with the Kimberley Process Certification Scheme, the World Diamond Council’s System of Warranties, the Canadian Diamond Code, the DTC’s Best Practice Principles (BPP) Assurance program, and through the De Beers Family of Companies, we are aligned with the Global Reporting Initiative (including the Metals and Mining supplement), the Millenium Goals, Extractive Industries Transparency Initiative (EITI), the Partnership Against Corruption Initiative (PACI), the Voluntary Principles of Security and Human Rights, the UN Global Compact and the Universal Declaration of Human Rights. Wherever practical, we provide metrics for our statements to illustrate our progress. In summary, we take a broad based approach and consider as many relevant factors as practical.
The Canadian Diamond Code of Conduct helps us with respect to our code of conduct and to provide a minimum standard for authenticating a claim that a diamond is a “Canadian diamond”. The Code states that there is a requirement for an in-house tracking system that secures and reconciles all rough diamonds extracted from a Canadian mine.
IntroductionThe Family of Companies is committed to fighting corruption and the damaging effects it has on business and economic growth. Accepting or giving bribes in all forms is prohibited in business transactions undertaken by the Family of Companies or through third parties. This includes subsidiaries, joint ventures or agents. This requirement is present in our Values, the BPPs and our Code of Business Conduct and Ethics. It is further supported by our commitment to the 10 principles of the UN Global Compact, the UN Convention against Corruption, our support for the EITI and our participation as a founding signatory of PACI.
All De Beers Canada’s employees and contractors are expected to behave in an ethical manner. All employees are required to abide by the Code of Business Conduct and Ethics, as well as a range of policies addressing corruption, anti-money laundering, and bribery. All transactions are transparent, and show respect for the rule of law, respect for international norms of behaviour, and respect for human rights. In addition, fair operating practices and consumer issues are part of our ethics. Senior managers were required to participate in a web-based legal training session on competition law compliance.
We do not have a formal consumer issues policy because De Beers Canada has a single consumer, the Diamond Trading Company in London, which is a related company. If the marketing arrangements change in the future, we will review whether a formal consumer policy is required.
Fair operating practices are relevant because these deal with the way we deal with other organizations that we may do business with, whether they are government, non-government organizations, other companies, Communities of Interest or stakeholders. Observance, promotion and encouragement of standards of ethical behaviour are key components, and performance is assured through our code of business conduct and ethics. Each employee signs this code annually as part of their annual performance appraisal and undertakes to abide by our code of business conduct and ethics. Fair competition, respect for the rule of law and adherence to ethical standards including accountability and transparency are essential. These are reinforced by our anti-corruption, prevention of money laundering, bribery, and practices with regards to political donations all of which are important.
In line with the De Beers Family of Companies’ policy, no political donations were made during 2010. Any Lobbying was undertaken only through trade organizations.
Ethics
De Beers Canada Inc. - 2010 Report to Society 36
The nature of our product, diamonds, requires a high level of customer confidence. We therefore have developed a “Best Practice Principles” (BPP) program for the De Beers Family of Companies to monitor how we are doing with respect to the many facets of ethics, namely corporate governance, legal compliance, combating corruption, bribery and anti-money laundering, human rights, safety, occupational health, environmental protection, product safety and our procurement supply chain. This means that we can provide our customers with a level of certainty that diamonds from De Beers Canada are not tainted in any way. The recent debate over diamonds from the Marange diamond fields in Zimbabwe has raised consumer fears that conflict diamonds may become a concern again. Anything that we can do to inform our customers and provide them with greater confidence in our product is advantageous and will help to protect our reputation. In addition, the BPP third party Assurance Programme verifies compliance with national and, where appropriate, international legislation with respect to:
The Best Practice Principles consists of a list of about 140 different questions. This list is tailored to the specific risk-based requirements
of each entity and each entity completes a customized questionnaire. This customized questionnaire takes into account the nature of the entity’s activities, their risks, and their position in the diamond pipeline. Where questions are not relevant to a specific entity, they are not asked. The completed questionnaires are then reviewed by the internal audit department of the De Beers Family of Companies, and are then reviewed by an independent third party. Currently this independent third party is SGS (formerly known as Société Générale de Surveillance). SGS then carries out a physical field verification of about one third of the entities each year to check whether or not the answers provided in the questionnaire are correct.
The Victor Mine was the subject of one of these physical field verificationvisits in November 2010. The Victor Mine participated in a successful physical field verification in November 2010. In Victor’s first-ever field visit, results were very positive with only six non-conformances (two minor and four major), all of which saw immediate Corrective Action Plans prepared and implemented. Findings are expected to be closed out in the first quarter of 2011.
To reinforce our position on ethics, De Beers Canada created a whistle blowing hotline. The hotline provides individuals with a safe and secure
means to report possible fraud, corruption, or theft; issues with diamond control or intellectual property, or deviations from good corporate governance practice. Reports can be submitted anonymously and without fear of recrimination.
Recent changes in legislation come into force in the United Kingdom relating to corruption with effect from April 1 2011. All the divisions of the De Beers Family of Companies will have to meet the requirements in order to comply with this new legislation. The De Beers Family of Companies is implementing a new anti—corruption policy and guidelines to ensure that its various business units are compliant, and these will be rolled out with an accompanying training program in the first quarter of 2011. During 2010, no training on anti-corruption or anti-money laundering took place as both of these are considered to be low risk in a Canadian context. This is mainly because we do not handle any significant amounts of cash and payments are centralised with good financial controls and are made by electronic transfer or by cheque.
No incidents of corruption were reported or detected during 2010.
•Money laundering• Terrorism financing• Bribery• Corruption• Smuggling
• Embezzlement• Fraud• Transfer pricing• Tax evasion
De Beers Canada Inc. - 2010 Report to Society 37
Management Approach - EmployeesEmployees are a critical factor in the success of any company. This subject covers a very broad area including employment, health and safety, human rights, training, compensation, freedom of association, talent management, social issues, feedback, and grievances. All of these are managed through a comprehensive set of policies and procedures for the company, augmented by site-specific policies and procedures for the two mines to reflect their particular needs and different regulations. Health, safety and environmental matters, together with legal compliance, are our highest priorities in managing employees.
IntroductionDe Beers Canada is extremely proud of its employees and the success they bring to our operations and our community and business partners. The Aboriginal component of our labour force is drawn, for the most part, from the communities closest to our two mines. This forms a significant part of our contribution to the sustainability of these communities through employment, skills development and work experience programs.
De Beers Canada has a combined approach to consideration of environment, communities, occupational health and safety, which are dealt with collectively. In the interests of transparency, the individual
Employees
Table 5-1: 2010 Human Resource Goals and Objectives
Goal Degree achieved Successes Shortcomings Additional remarks
Working together ensuring production targets are met through an effective harmonious business climate (examining our labour efficiencies on a continuous basis).
Great strides made working with the mine sites and ensuring we are maximizing the talent we have.
Critical positions filled through established regular recruitment methods or through creative means for maximizing talent already on staff.
Two critical technical positions are being recruited for and are being covered on an interim basis.
Devising recruiting strategies in order to address the challenge of attracting qualified candidates to remote site locations.
Ensure all positions are filled with capable and qualified people, and conduct required Gap Analysis.
98% of positions filled through efficient attraction, transfer, retention and development of employees.
Gap Analysis complete: identified and reviewed development opportunities.
Due to pressures on the front-line, not all development plans have been completed for management teams.
Scheduled for completion in 2011.
A sound Human Resources Infrastructure with fair and consistently applied policies and procedures, salary, benefits and pension administration.
Support mechanisms, policies and procedures are functional for operational effectiveness.
Defined Benefit Plan frozen and members enrolled in Defined Contribution Plan. Benefit renewal achieved significantly under target.
Regular market comparisons being made to ensure competitiveness of benefits programs.
Minimize the frequency and number of third party challenges and legal cases.
Majority of matters have been handled without legal intervention and with favourable outcomes.
Matters resolved expediently and at minimum cost.
Need to further reduce the number of third party challenges and legal cases.
Training and communication should reduce number of cases.
A supervisor checks safety cards to ensure employees are working safely.
De Beers Canada Inc. - 2010 Report to Society 38
components are safety, health and wellbeing, HIV/AIDS, human rights and harnessing and developing the talent of our employees. Environmental matters are dealt with in the environmental section below. Note that all references to Aboriginal employees in this section refer to those who have self-identified as being of Aboriginal ancestry. These figures are likely under-reported as some individuals choose not to self-identify themselves. All employees are included in an annual performance appraisal system. Training is available to all employees annually to help each individual to grow and advance through self-improvement.
Feedback from employees and suggestions for improvements are obtained through a Joint Consultative Committee at each mine. The input to these committees by employees is forwarded to senior management for action where appropriate. During 2010, mechanisms were examined to capture input from employees at other venues, and a policy and procedure for an ‘External Outreach and Feedback Form’ was drafted and submitted to the Executive Committee for approval. This would apply to all employees and feedback and suggestions could be made through the internal corporate Intranet and would facilitate input from the venues where there is no formal Joint Consultative Committee such as the offices in Timmins, Toronto and Yellowknife. This will be in place early in 2011.
There were no work stoppages during 2010 at any mine, exploration project or operation.
Please note that specifics for grievances and disputes are dealt with under Communities of Interest.
StrategyOur strategy is to train workers for skilled and semi-skilled positions and increase the capacity of northern workers for our operations within Northwest Territories for our Snap Lake Mine and the neighbouring communities with which we work in Ontario for the Victor Mine. Employees from outside of these catchment areas are essential for the capacity building effort as they bring an average of 15 – 20 years of experience to their positions. They are keen to share their knowledge and act as mentors. In order to ensure maximum exposure of available positions to local communities, all vacancies are posted in local newspapers, communities and online. At Snap Lake, the shortlist of candidates and initial interviews are conducted from the northern applicants prior to any southern candidates being considered. At the Victor Mine, applications from the coastal First Nations communities receive first consideration. Then applications from other First Nations applicants, then residents of Timmins and Northern Ontario and finally those applicants from Southern Ontario and outside of Ontario.
Snap Lake MineFollowing the increase of activities after the economic slowdown in 2009, the numbers of contractors and temporary workers on site increased. At the end of 2010, there were 455 permanent employees at Snap Lake Mine. Snap Lake has eight senior managers, all of whom reside in Yellowknife, and four of these are from the north. Figure 5-2 shows the statistics at the end of the year and figure shows the employment trends for the period 2008 to 2010.
Snap Lake is the third diamond mine in the NWT, and many of those in the local labour pool already had employment before De Beers Canada commenced hiring. Progress continued to be made in employing Aboriginal employees from nearby communities, despite the limited pool of labour and competition for a skilled workforce from the other two diamond mines in the region. Steps will continue to be taken to increase the numbers of Aboriginal people employed together with the number of Aboriginal employees in skilled, supervisory and management positions.
Victor MineAt Victor, 503 persons, including 52 part-time and contract people, were employed at the end of the year. The details are shown in Figure 5-2. At the Victor Mine, of the eight Senior Managers at the mine site, six reside in Timmins or the immediate area.
Hauling ore from the open pit at Victor Mine.
De Beers Canada Inc. - 2010 Report to Society 39
The breakdown of labour at the end of 2010 for the Victor Mine is shown in Table 5-2. Figure 5-1 shows the turnover in 2010 by both age and gender.
A more detailed breakdown of the Aboriginal component is available in the socio-economic reports for Snap Lake. The report for 2010 will be available in mid-2011 as the analysis of statistics takes some time and a review of all contractor statistics needs to be incorporated as well as formulas for rotational work to report on both numbers of people and person-hours, prior to the figures being finalized and released.
Absenteeism during 2010 amounted to a total of 7,803 days, all of which were non-work related (non-work related includes sick days, short-term disability, and long term disability). Details are shown in Figure 5-5.
Good progress was made in employing Aboriginal employees from nearby communities. Career and job fairs were held in many communities, and recruitment was focused within communities of interest. In most instances, there are hiring preferences resulting from the impact benefit agreements, which provide for hiring priorities for particular communities. Steps will continue to increase the numbers, and to increase the number of Aboriginal workers in skilled, supervisory and management positions.
Figures for Gahcho Kué are also included in Figure 5-2.
There was no significant restructuring at De Beers Canada in 2010. Changes in complement reflected variations in personnel as circumstances dictated changing requirements at the mines.
At Snap Lake, recruitment was undertaken as part of the resumed ramp-up to full production after the slowdown in 2009 and 175 positions were filled. At Victor, there was limited restructuring when the workforce was rationalised in the third quarter and seven vacant positions were eliminated. There was no restructuring within at the corporate or exploration divisions. A breakdown of the turnover figures shows that of the 202 people that left, 49 were female and 153 were male.
Although De Beers Canada has freedom of association, no collective bargaining agreements were in place during the reporting period.
Diversity and DiscriminationEqual opportunity is assured through a company policy on the intolerance of any form of discrimination. During the Best Practice Principles assessments, a random sample of employees was questioned about discrimination, including equal opportunities. Each mine has negotiated impact benefit and/or socio-economic monitoring agreements that outline the requirement for, and monitoring of, preferred hiring criteria for Aboriginal people from local communities in which De Beers Canada operates.
All members of the Board of Directors are male; however the senior management and corporate governance bodies include 53 employees of which 13 are female and three are of Aboriginal ancestry on the senior management team. The breakdown by age within this group is shown in Figure 5-3. A management and supervisors program is in place to help develop management capacity within the workforce and currently there are two trainees enrolled in this program at Victor.
De Beers Canada employees (1,087)
50 100 150 200 250 300 350 400 450 500 550
Snap Lake Mine
Victor Mine
Gahcho Kué Project
Corporate
Exploration
Figure 5-2: Employment statistics as at 31 December 2010
Legend:
Aboriginal workers
Non-Aboriginal workers
Part-time and contractors
Figure 5-1: Employment turnover
Turnover by age
5 10 15 20 25 30 35 40 45 50
Snap Lake Mine
Victor Mine
Gahcho Kué Project
Corporate
Exploration
Legend:
20-29
30-39
40-49
50-59
60-69
70-79
Turnover by gender
5 10 15 20 25 30 35 40 45 50
Snap Lake Mine
Victor Mine
Gahcho Kué Project
Corporate
Exploration
Legend:
Female Male
De Beers Canada Inc. - 2010 Report to Society 40
Number of employees by age
5 10 15 20 25 30
60+
50-59
40-49
30-39
20-29
Figure 5-3: Employment statistics as at 31 December 2010
The ratio of male to female employees by skill band is shown in Table 5-2.
At Snap Lake, two cases of alleged discrimination were before the Human Rights Commission. The first case was related to alleged discrimination based on a disability and race complaint. This was denied by the Commission and dismissed. The second complaint is regarding discrimination against a northern aboriginal employee during the drug and alcohol-testing program. The complainant is an employee of a contractor, and this case is currently before the Commission. De Beers Canada is one of three defendants in this matter.
In total, De Beers Canada received three informal complaints under the Harassment and Discrimination policy, all were resolved through the Informal Complaint Procedure. No action was required.
An additional two complaints were filed under the formal complaint process. One of the complaints was resolved prior to an investigation having to be completed and the second complaint was dismissed by the Human Rights Commission.
Human RightsDe Beers Canada is focussed on maximizing the rich culture of a diverse workforce, and providing a work environment where each employee is treated fairly, and with respect; where each employee has the opportunity to contribute to the success of the business and to realize their full potential as individuals. Human rights of the individual employee and communities are protected through our Principles, application of the Best Practice Principles, our Protective Services, our Human Rights Policy and our comprehensive company policies. Our Human Rights policy covers the right to dignity, respect and protection, working conditions and practices, absence of any form of harassment, absence of corporal punishment, freedom of religion, freedom of political choice, freedom of association and collective bargaining, forced labour (also known as compulsory labour), child labour, non-discrimination, training and development.
Both the De Beers Family of Companies and De Beers Canada have Human Rights policies that prohibit all forms of discrimination. Application of these policies is tracked through the Best Practice Principles program. The De Beers Canada Human Rights policy is based on clear principles that confirm an individual’s right to dignity, respect and protection; for working conditions and practices that do not infringe on inherent dignity; freedom from any form of harassment whether manifested in behaviour, language, or gesture; freedom from abuse whether corporal punishment, mental or physical; and the right
to belong to any cultural, religious or linguistic community and not be denied the right to practice their religion or their culture.
We welcome the new draft “Guiding principles for the implementation of the United Nations ‘Protect, Respect and Remedy’ Framework” tabled by the Special Representative of the Secretary General late in 2010, and we are studying this carefully to see how we can best align our practices with these so that we can proactively implement these recommendations.
During the year, there were three informal complaints at Victor that were resolved through the Internal Complaint Procedure. There were two formal complaints, The first was filed at the end of 2009 and was reported last year, but was investigated at the beginning of 2010 and the individual was counselled appropriately. In the second case, the complainant was unavailable for the investigation and the respondent’s employment was terminated prior to the completion of the investigation for reasons unrelated to the harassment investigation.
In addition, individuals have freedom of association for the protection of their interests and to bargain collectively if they so wish, but are not compelled to do so.
Forced labour is forbidden; overtime is voluntary and restricted to the national and regional permitted levels and at least the statutory remuneration levels; individuals have freedom of movement and shall not be unreasonably or unnecessarily restricted. Employing child labour is not considered a high risk for De Beers Canada. There are Provincial laws and regulations governing minimum age restrictions for working in both office settings as well as on the mine sites. In addition, De Beers Canada follows a strict Human Rights Policy that outlines parameters regarding child labour. Photo identification along with birth registration information is required as part of the hiring process to ensure employees are of the correct age to work at either the office or mine site.
No discrimination on the basis of race, colour, religion, political opinion, gender orientation, national extraction or social origin is tolerated. There is equal pay for work of equal value. The only exceptions to this are where we have hiring and training priorities in the NWT as part of our Social Economic Agreement with the Government of the Northwest Territories, and also Impact Benefit Agreements for Victor Mine.
All Protective Services employees are trained in the De Beers Human Resources (HR) and Security Human Rights Policy (DBGS-GRPS-001).
Table 5-2: Ratio of Basic Salary by Gender and Patterson Skill Band
Male : Female Male : Female
F N/A CU 1.093:1
EU 1.073:1 CL 1.093:1
EL 1.085:1 BU 1.093:1
DU 1.095:1 BL 1.093:1
DL 1.095:1
De Beers Canada Inc. - 2010 Report to Society 41
The policy and documents referred to in this policy are made available to our employees for self study. These documents include the following:
The UN Universal Declaration of Human RightsDe Beers Purpose, Vision and ValuesDiamond Trading Company Diamond Best Practice PrinciplesThe De Beers Code of Business Conduct and EthicsThe UN Global CompactThe Voluntary Principles on Security and Human RightsThe UN Code of Conduct for Law Enforcement OfficialsThe UN Basic Principles on the use of Force and Firearms by Law Enforcement Officials
In addition to this all Protective Services employees undergo training irrespective of previous training or experience. This training is scheduled as soon as possible after the employee joins De Beers Canada and relates to federal, provincial and territorial statutes governing the security industry.
The following is a breakdown of the average number of hours by category that each employee has received concerning aspects of human rights.
There were no significant investment agreements that included human rights clauses. No significant suppliers or contractors have undergone screening on human rights nor have any actions been taken. All contracts indicate that contractors have to abide by De Beers Canada policies and practices, which include our Harassment and Discrimination policy and program.
All new employees, contractors and visitors at both mine sites are required to complete a site orientation prior to commencing any
activities at site. The site orientation includes information and instruction on De Beers Canada’s Harassment and Discrimination policy, procedure and program. In addition, refresher training is provided annually along with an eight hour cross cultural awareness training.
CompensationDe Beers Canada offers a comprehensive benefit package that far exceeds legally mandated requirements and is competitive within the market place. Table 5-4 shows the ratio of standard entry level wages compared to those offered at our corporate, exploration, Snap Lake and Victor locations.
Table 5-3: Human Rights training per employee by Patterson Skill Band
Average hours Average hours
F 3 CU 8
EU 3 CL 8
EL 3 BU N/A
DU 8 BL N/A
DL 8
An apprentice cook with Bouwa Whee Catering working in the kitchen in the new accommodations facility at Snap Lake Mine.
De Beers Canada Inc. - 2010 Report to Society 42
Table 5-4: Entry level wages by location and Patterson Skill Band
Business unit Entry level wage Minimum wage Ratio
Corporate
B3 18.01 10.25 1.75:1
B4 20.98 10.25 2.05:1
C1 22.81 10.25 2.23:1
C2 25.31 10.25 2.47:1
Exploration
B3 18.01 10.25 1.75:1
B4 20.98 10.25 2.05:1
C1 22.81 10.25 2.23:1
C2 25.31 10.25 2.47:1
Snap Lake Mine
B3 18.01 9.00 2.00:1
B4 20.98 9.00 2.33:1
C1 22.81 9.00 2.53:1
C2 25.31 9.00 2.81:1
Victor Mine
B3 18.01 10.25 1.75:1
B4 22.98 10.25 2.05:1
C2 22.81 10.25 2.23:1
C1 25.31 10.25 2.47:1
Gahcho Kué Project
B3 18.01 9.00 2.00:1
B4 22.98 9.00 2.33:1
C2 22.81 9.00 2.53:1
C1 25.31 9.00 2.81:1
Highlights of the programme include Life Insurance equal to 250% of annual salary to a maximum of $1,000,000 and equal coverage with Accidental Death and Dismemberment. To guard against financial hardship should an employee become ill and be unable to work as a result of a non-occupational injury or illness, the company provides 8 occasional sick days and Short Term Disability up to 180 calendar days on a declining scale of payment, i.e. Day 1-30 100% of base salary, Days 31 – 92, 75% of base salary and Days 93 – 180, 70% of base salary. Long Term Disability coverage beyond the initial 180 calendar days of Short Term Disability is paid at a benefit of 66.7% of the employee’s monthly earnings to a maximum of $10,000 per month. Extended health care coverage includes a prescription drug card, semi-private hospital coverage, vision care coverage of $200 every 24 months and 100% of basic dental coverage. All premiums required for this coverage are paid by the Company. The company also sponsored a Non-Contributory Defined Contribution Pension Plan and a Defined Benefit Pension Plan (for employees with a start date earlier than January 1, 2004). No benefits are offered to part-time employees.
In 2010, the company paid $3,878,575 in benefit premiums and contributed a total of $4,326,743 to the pension plans.
A full benefit package review was completed in 2006, and is continually reviewed for improvements compared to market comparisons.
Benefits offered:
• Hospital care• Home nursing care• In-Canada prescription drugs• Smoking cessation products• Fertility drugs• Hearing aids• Custom-made orthotics and
stock item orthopaedic shoes• External breast prosthesis•Myoelectric arms • Chiropractors• Podiatrists• Osteopaths• Speech therapists• Eye examinations•Mechanical or hydraulic
patient lifters
• Outdoor wheelchair ramps• Blood-glucose monitoring
machines• Transcutaneous nerve
stimulators• Long term disability• Short term disability• Life insurance• Surgical brassieres• Extremity pumps for
lymphedema• Physiotherapists• Naturopaths• Psychologists/Social Workers•Massage therapists• Glasses, contact lenses and
laser surgery
De Beers Canada Inc. - 2010 Report to Society 43
All employees are covered by accidental death and dismemberment insurance and business travel accident insurance.
Freedom of AssociationA Joint Consultative Committee comprised of representation from management and workers meets regularly at the Snap Lake Mine site to discuss issues and resolve concerns that are identified by both management and the workforce. There is also a separate Joint Consultative Committee at the Victor Mine site. The Victor committee is supported on site by an Aboriginal Employees Advisory Committee that is also comprised of representation from management and First Nation workers at the mine.
De Beers Canada has a non-unionized workforce and therefore, no employees were covered by collective bargaining agreements. Employee representatives cover health and safety through the Joint Occupational Safety, Health and Environment Committee. The JOSHEC covers all employees.
Although no minimum notice periods regarding operational changes are required by law, unless unusual circumstances occur, the company provides a minimum of three to four weeks notice to employees of organizational or rotation changes. Because we have non-unionized workplaces, there are no risks to freedom of association and collective bargaining rights at any of our operations or joint ventures,
Employee TrainingTraining is important for the safety and success of our operations, and for the personal growth of our employees. It is an opportunity to provide each employee with new or improved skills and knowledge to position them better for the future, not only working for De Beers, but also in their own lives once a mine has closed. The following table outlines the time spent on training employees in 2010 which is dependent upon their banding position. With slightly easier economic conditions in 2010, we were able to expand training beyond provision of only essential core training required for day-to-day operations.
The key to De Beers Canada training program is to engage in active collaboration with all departments and with individual employees. This is to ensure that all training is targeted to support essential operational requirements and in growth of the individual employee. All Managers and Supervisors are involved in identifying, defining and refining departmental training needs within the training matrix to prioritize outcomes. This review also serves to ensure Ministry compliance. Successful delivery of training programs provides employees with skills that are useful in the workplace, and can also be transferred to the communities or to other jobs after the
mines close. The development of skills is an important component of the benefits provided by the company. During the annual performance review, employees have the opportunity to discuss individual training requests and requirements with their supervisor. Once these requirements have been agreed they are included in the development program for the individual.
De Beers Canada offers several types of training opportunities on site as well as encouraging and supporting continuing education for employees. A number of the on-site training courses are mandatory, e.g. safety and orientation and others are job or departmentally specific. Professional growth and development is supported through course reimbursement and a “time for time” program which matches an employee’s willingness to study. For instance, if an employee commits two hours of their own time to get their General Equivalency Diploma (GED), they would be given two hours off work to continue that study. There are also workplace instructors at both mine sites to provide additional support and training.
Some of the programs offered at both Snap Lake and Victor Mines are shown in Table 5-6.
Table 5-5: Training per employee by Patterson Skill Band
Average hours Average hours
F 0 CU 36
EU 0 CL 61
EL 10 BU 61
DU 41 BL 46
DL 36Eight young people from the James Bay Coast shadowed De Beers Canada Victor Mine employees as part of the OJT Northern College program.
Elders pass along traditional ecological knoweldgeThe Snap Lake Mine practices many different environmental monitoring activities as mapped out in its Environmental Agreement. One such activity is to host members from the Aboriginal communities to participate in catching, cooking and eating fish caught from Snap Lake to monitor the impact of the mine on aquatic life. The group, which includes local community Elders and De Beers employees, travel to an island near the Snap Lake Mine site for this annual event.
Elders from four Impact Benefit Agreement groups - Tlicho Government; North Slave Métis Alliance; Yellowknives Dene First Nation and Lutsel K’e Dene First Nation - visited Snap Lake Mine in September to take part this year.
After they were caught, the trout were cut open and their organs examined. The fish were filleted for frying or boiling over a fire. The fish tasting was a success, and resulted in the passing along of traditional knowledge.
exempli gratia
De Beers Canada Inc. - 2010 Report to Society 44
Mandatory (e-learning or classroom)General Site Orientation
WHMIS
Safety, Health & Environmental Operating Procedures
Waste/Wildlife Management
Accident/Incident Awareness
Fire Extinguisher*
5-Point Safety System
Spills Awareness
SUPA (See, Understand, Plan, Act)
Mandatory ClassroomSHE Awareness
SHEOPS Safety Health & Environmental Operating Procedures
Drug & Alcohol Awareness
Cross Cultural Awareness
IRS Internal Responsibility System
Workplace Harassment and Discrimination
Job Specific TrainingAccident Incident Reporting
Arc flash high voltage Safety IH07 - 8801
Blasting certification*
Surface Drivers Permit
Lock Out/Tag Out
Confined Space Entrant and Attendant
Crisis Management
Diamond Value Management
Equipment (specific to site and equipment to be used, e.g. Cement mixer, dozer, Fuel Truck, Grader, Haul Truck, Loader, School Bus, Tandem Truck, Water and Sewer Truck, Fork Lift etc)
ERT – Specific to site and needs (e.g. Basic Mine Resue Training, Emergency Vehicle Operation, Fire Extinguisher Training, Live Fire Training, Practice)
Fall Protection
Fire Watch*
Hot Works
Ives Training (Aerial Boomlift, Bobcat Skid Steer, Counterbalance Forklift, Rough Terrain Forklift, Scissors Lift)
JOSHE Committee Training
Overhead Crane
Radiation Safety Awareness
Radiation Training for Fixed Nuclear Gauges
Radiation Safety Officer
Safe Work Plan
SAP 101
Surface Common Core**
Surface Driver’s Licence*
Transportation of Dangerous Goods
Train-the-Trainer
Working with Nuclear Gauges
SupervisoryConfined Space Entry Supervisor
First Aid
Supervisor Certification (WSCC)
IRS for Supervisors
Supervisory Tools
Accident/Incident Investigation Training
Safe Work Place
Drug & Alcohol Awareness – Supervisors
General InterestMicrosoft Office
GED Preparation
Apprenticeship tutoring
Stretch Your Pay Cheque
Local Community SchoolsStay-in-School (High School)
Career counselling (High School)
Stretch your Pay Cheque*
* Offered at Snap Lake Mine only
** Offered at Victor Mine only
In addition, training is carried out in some of the communities to help prepare people for future employment. Current training is offered for First Aid, Train-the-Trainer, Stay-in-School and WHMIS. There are plans to expand this list in the future.
There are procedures in place to guide the recruitment of new employees, allow the reporting of any cases of unfair discrimination without fear of redress and to allow employees to be coached, mentored, trained and appropriately equipped to be skilled, productive and efficient in their current positions.
Monitoring mechanisms are in place and any incidents of harassment or discrimination are investigated and results reported.
Feedback mechanismA Whistle Blowing policy exists and is posted on the intranet. It was also distributed to all staff to review the policy and become familiar with the procedure. Posters highlighting the aspects of the Whistle Blowing policy are posted throughout the offices and mine sites. A bi-weekly overtime report is reviewed and the divisions are required to provide rationale for overtime hours worked ensuring no forced overtime was worked. In addition, feedback and suggestions from employees at the two mines are captured through the joint consultative committee at each site. Input to these committees is forwarded to senior management for consideration and action where appropriate.
De Beers Canada has a formal complaint procedure as part of its workplace Harassment and Discrimination Policy and Procedure. In addition, there is a separate Issue Resolution Procedure that includes a review and appeal to Senior Management.
The grievance processes outlined above are combined with a whistle blowing policy and procedure that includes the no recrimination against anyone brining a matter to the attention of the company.
In summary, De Beers Canada endeavours to maximize the participation of Aboriginal people at its mines and during exploration. Cross cultural awareness training is provided to employees to the main concerns and issues of Aboriginal people. De Beers Canada is an equal opportunity employer, and our strength is through cultural diversity. Engagement with Aboriginal peoples is guided by two policies, “Working with Aboriginal Peoples”, and the De Beers Canada “Community Policy”. Both of these are available from De Beers Canada offices, and both are also available on our website.
Table 5-6: Employee training opportunities
De Beers Canada Inc. - 2010 Report to Society 45
Harnessing and developing talent Employees are encouraged to embrace lifelong learning so that they can improve and advance themselves. Training programs are run at the mines; employees are encouraged to participate in courses and funds are budgeted for each employee for training every year. There is relevant subject training inclusive of apprenticeship programs at the two mines.
Social IssuesDialogue is undertaken with affected communities to ensure that any mitigating measures for project related impacts are understood, and that where possible, are aligned with the community’s priorities.
There is a zero-tolerance for bribery and corruption. De Beers Canada has a Code of Business Conduct and Ethics, and Workplace Harassment and Discrimination policy, supported by an Anti-Money Laundering Policy. A new policy is being drafted for the entire De Beers Family of Companies to address corruption, bribery, anti-money laundering and similar issues in order for the company to be compliant with new legislation being enacted in the United Kingdom. This new policy will be launched in the first part of 2011. There is also a zero tolerance for alcohol and substance abuse at both mines. These policies are rigorously enforced, and are further supported by a Whistle Blowing Policy. Compliance with these is mandatory and each employee and contractor is required to read and sign these policies acknowledging that they understand the guidelines in the operation of their daily job.
De Beers Canada follows the De Beers Group practice that guides contributions to political parties, and has a code of business conduct and ethics that supports this concept.
De Beers Canada was not involved in any court decisions regarding cases pertaining to anti-trust and monopoly regulations during the reporting period.
Concerns, grievances and feedback from employeesThere are a number of mechanisms for employees to raise concerns, issues or grievances, or to provide feedback. On the mines, there are Joint Occupational Safety, Health and Environment Committees (JOSHEC). Both mines also have joint employee committees. During the year, a web based system was implemented for employees using the intranet where individuals could provide feedback, raise concerns of issues, or air a grievance anonymously, or provide their name if they so wish. Individuals are also able to raise concerns at any time with their supervisor or manager, or through the Human Resources department. There is a separate confidential whistle blowing system to alert management about actual or suspected improprieties.
An employee with Tlicho Landtran hooks up a hose to unload fuel at Snap Lake Mine. Containers are placed beneath each hose connect to ensure no fuel is spilled on the ground.
De Beers Canada Inc. - 2010 Report to Society 46
Employee Health and SafetyOur Occupational Health and Safety Policy was merged with our Environmental Policy and our Sustainable Development Policy at the beginning of 2010 to form a new broader-based Sustainable Development Policy. This has allowed us to align these policies, reduce duplication and strengthen the overall policy itself. The new Sustainable Development Policy is available on our website. We will align our Sustainable Development strategy and philosophy over the next couple of years with the remainder of the De Beers Family of Companies. We no longer have a stand-alone Occupational Health and Safety Policy.
Occupational accidents and diseases are recorded in accordance with governing Canadian legislation of respective Workplace Safety and Insurance Boards and/or Workers’ Compensation Boards, as appropriate in the geographic region of our operations. The respective Boards set the basis upon which the Mining Industry’s occupational accidents, injuries and diseases are recorded and reported.
A combined joint occupational safety, health and environment committee (JOSHEC) operated throughout the reporting period at the Toronto office. All other office and mine site locations have their own joint occupational safety, health and environment committees. All committees have both management and worker representation. These committees effectively cover the entire workforce.
There were no fatalities during the period.
There are no formal agreements with trade unions, therefore there are no health and safety topics covered within such agreements.
All De Beers Canada operations have health and safety management systems in place based on the requirements of the OHSAS 18001 standard for occupational health and safety.
Safety There is a single overarching objective of ‘Zero Harm’ at De Beers Canada. The company has a Sustainable Development Policy that includes an Occupational Health and Safety Policy which applies to all parts of De Beers Canada. The exploration and mine sites are covered by separate safety management systems that is consistent with OHSAS 18001 standard, and the intention is to certify these early in 2011 to this standard. The goal of achieving certification in 2010 was not achieved because all the preparatory work could not be completed in time. Work continued during 2010 to ready employees, sites and these systems for certification early in 2011. Exploration undertook internal safety management system audits at Sudbury and Toronto.
In each workplace and exploration camp, there is a Joint Occupational Health Safety and Environmental Committee (JOSHEC) with representation from management and employees. On the mines and in the offices, the employees’ representatives are elected and the management members are appointed. In the exploration camps, where the numbers of employees are usually below the threshold for a formal joint occupational safety and health committee, employees are encouraged to participate either by volunteering or more usually by selection by co-workers.
Daily safety talks and checks are undertaken at each mine, in each mine office and exploration camps as the risks are high. In the Toronto, Timmins and Yellowknife offices where the risks are lower, weekly safety meetings are held.
Combined health and safety statistics are summarized in Table 5-7. Unfortunately, Exploration suffered one Lost Time Injury (LTI) following failure of a component on a drill rig during operations. Snap Lake incurred eight LTIs and Victor incurred four LTIs during the year.
Each operation has specific emergency response plans, based on the risk assessment for each mine. Generic response plans are used by the exploration teams because of the number of areas that are prospected. Where activities are within the area of interest of a community, the emergency response plans are discussed and integrated with those for the community in question. Emergency response plans call for a minimum of two drills per year, involving all persons present at any particular facility.
Trucks remove ore from the open pit at Victor Mine.
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Table 5-7: Health and safety statistics for 2010
Metric MilestoneSnap Lake
MineVictor Mine
Gahcho Kué Project
Exploration DBCI 2010 DBCI 2009
Fatalities 0 0 0 0 0 0 0
LTI 0 8 4 0 1 13 2
LTIFR 0 1.1 0.64 0 1.8 0.88 0.18
LTISR N/A 25.5 15.3 0 20.3 18 18
Safe hours (millions)
N/A 0.096 0.72 0.45 0.017 1.27 N/A
TIFR 2.0 3.7 4.3 7.1 5.5 3.9 2.2
Near hit ratio >5 3.0 18.5 0 16.6 N/A N/A
LegendLTIFR: Lost Time Injury Frequency RateLTISR: Lost Time Injury Severity RateSafe Hours: Hours worked without an LTINear hit ratio: (Near hit reports to all incidents)
TIFR: Total Injury Frequency Rate (all injuries except first aids)Milestone: 2008 target improvement milestoneN/A: Not ApplicableDBCI: De Beers Canada Inc.
A snow plow from Tlicho LandTran clears snow off the ice as part of maintenance the winter spur road to Snap Lake Mine.
De Beers Canada Inc. - 2010 Report to Society 48
Snap Lake LTIs
5 10
2008
2009
2010
Figure 5-4: Safety Statistics for Snap Lake and Victor Mines, 2008 -2010
Snap Lake LTIFR
0.5 1.0 1.5
2008
2009
2010
Snap Lake LTISR
10 20 30 40
2008
2009
2010
Snap Lake TIFR
2 4 6 8
2008
2009
2010
Snap Lake Near hit ratio
1 2 3 4
2008
2009
2010
Victor LTIs
1 2 3 4 5
2008
2009
2010
Victor LTIFR
0.2 0.4 0.6 0.8
2008
2009
2010
Victor LTISR
10 20 30 40
2008
2009
2010
Victor TIFR
2 4 6 8
2008
2009
2010
Victor Near hit ratio
10 20
2008
2009
2010
Days (000s)
0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 5.5
Snap Lake Mine
Victor Mine
Gahcho Kue Project
Corporate
Exploration
Figure 5-5: Absenteeism by business unit
Legend:
Lost days
Absenteeism
5
33
De Beers Canada Inc. - 2010 Report to Society 49
Health and wellbeing Health and wellbeing of all employees and contractors is encouraged and promoted within the company. Programs and periodic presentations were made during the year on diabetes, HIV/AIDS and various other topics including healthy eating, diets, exercise.
No instances of occupational diseases were noted during 2010.
Education and training on accident prevention, health and safety is provided to employees using a training matrix within the health and safety management system. This identifies the requirements for the different positions. This is reinforced by daily toolbox talks in the workplace on the mines, and by at least weekly sessions in the offices. Counselling services, at the company’s expense, are available to employees and their dependents through a contract service.
At Snap Lake and Victor, much of the year was spent reviewing and updating the integrated safety health and environment management system to comply with the Fatal Risk Control Guidelines for the Family of Companies, for ISO14001 and OHSAS18001. Auditor training was completed in preparation for the certification for OHSAS18001 which is now scheduled for mid-2011.
HIV/AIDS Unlike many of the countries where the De Beers Family of Companies operates, the prevalence of HIV/AIDS in Canada is much lower. The focus for De Beers Canada is thus on HIV/AIDS prevention and awareness. The Global HIV/AIDS Policy for the De Beers Family of Companies applies in Canada and an approach in Canada is aligned with the risk.
Environmental Coordinator Deborah Flemming examines a water sample in the environmental lab at Snap Lake Mine.
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Management Approach - Communities and stakeholdersCommunities of Interest (COI) include all our stakeholders, ranging from employees to the communities that we work with, as well as government, non-government organizations and the public. We are aware the exploration, construction, operation and closure phases of a mine have varying effects on our COI. Engagement programs help us understand the interests and concerns of our stakeholders, which is considered when formulating our plans for further community engagement, social responsibility practices and sustainability. We have learned that it is important to discuss plans with our COI and to listen to their comments, and then where practical, incorporate them. Our feedback mechanisms continue to be refined to ensure we meet the needs of our stakeholders and the ‘Towards Sustainable Mining’ (TSM) initiative run by the Mining Association of Canada. As we move forward with the TSM initiative, we will look to meet even higher standards in this regard, including the establishment of a COI Advisory Panel for each of our operations as part of our goal of continuous improvment.
Communities
Table 6-1: 2010 community goals and objectives
Goal Degree achieved Successes Shortcomings Additional remarks
Improved community engagement for Victor to avoid blockades of winter road.
Achieved: no blockades of 2010 winter road.
Also used to improve interaction with Communities of Interest for the mine.
Further work still needs to be done in this area.
Community meetings held with main Communities of Interest.
Development of community engagement plan for Snap Lake Mine for 2010 - this will allow us to collaborate with our Communites of Interest and gain a deeper understanding of planned Land Use Permits and provide an opportunity for our COI to express comments, questions and concerns prior to the formal application.
Plan implemented and submitted to regulator as part of Land Use Permit Application.
Significant involvement of lands & environment staff, committee members, leadership and elders in site visits and meetings.
Some communities chose not to participate due to capacity constraints.
Some communities who are included by the company in engagement activities are frustrated that they do not have Impact Benefit Agreements.
Jessica Abel (left) from De Beers Canada, watches a student from Kaw Tay Whee School in Dettah demonstrate a new Macintosh computer.
De Beers Canada Inc. - 2010 Report to Society 51
Table 6-1: 2010 community goals and objectives
Goal Degree achieved Successes Shortcomings Additional remarks
Design and planning for Community engagement for Gahcho Kué (GK) Project - to ensure a mutual understanding of project implications between De Beers Canada and the Communities of Interest and to incorporate feedback of local people into project planning.
Community engagement plan implemented.
Plan and progress to plan submitted as part of the Gahcho Kué Environmental Impact Statement sent to the Mackenzie Valley Environmental Impact Review Panel December 23, 2010.
Weather and limited program dates for the exploration camp prevented De Beers from being able to host all Aboriginal groups at GK when they were available.
The MVEIR Panel will confirm conformance to Terms of Reference, including community engagement in Q1 2011. An updated engagement plan for the EIR phase of the project will be created for 2011 which will take into consideration the MVEIR Panel response to EIR.
Establishment of panel to facilitate feedback from Communities of Interest for each mine.
Not achieved. Insufficient resources available in 2010. Implementation deferred until 2011.
Linked to implementation of TSM goals.
General Approach to Communities of InterestStakeholder engagement begins early, preferably before activities commence on the ground, and continues through the life of a project, even after closure. Frequency of engagement depends on the nature and duration of planned activities and the preference of the stakeholders or community. The process evolves through a series of steps: first an information exchange to set the scene; second, dialogue on how each party wishes the discussions or consultation to proceed; third, consultation; fourth, a period of digestion to assimilate feedback heard during consultation and to work out how the issues and concerns raised can be addressed; fifth, feedback on these decisions to the community and capture of any new issues or concerns (this process continues until as many issues and concerns as possible have been addressed, accepting that some may not be resolvable, and the community has to be informed and given the reasons why); and sixth, collaboration with the community to move the plans forward, and; seventh, empowerment of the community to provide free prior informed consent for any significant developments. In addition, an exit strategy is prepared in case it is required during the implementation or on the completion of a project.
Each community is unique. The approach to engagement has to remain flexible to accommodate the priorities and needs of our COI. The best progress is made where community requirements align with the company’s strengths. We do not commit to things that we cannot practically or reasonably deliver as this serves neither the community nor the company. We believe the process has to be open, transparent, respectful and honest. One of the main themes to our approach is to work in terms of “a hand up” rather than “a hand out.” We find a hand up helps build community capacity, individual self esteem and empower those looking to grow beyond the life of the mine. A hand out may resolve an immediate issue, but we believe does not help a community or group overcome a similar situation in the future. The life of a mine is often short and we believe it would be irresponsible for us to contribute to a developing dependency within a community through non-sustainable hand outs.
We have adopted a flexible “site approach” to engaging our COI rather than a single prescribed model. This approach allows any issues within our eight IBA communities related to the Snap Lake and Victor mines to be managed more effectively to the benefit of all parties.
Our policyWhile the De Beers Family of Companies has a community policy, De Beers Canada has one that is specific to Canada and that addresses Canadian conditions. Our community policy (available on our website or upon request from [email protected]) requires free, prior, and informed consent before the commencement of any significant mining operations. Consultation continues until planned activities have been completed, and periodic reporting back by De Beers Canada to the communities of interest and stakeholders on activities.
De Beers Canada has a consultation protocol and an informal/draft community management system to ensure a consistent approach to all communities of interest. A policy for working with Aboriginal communities governs our engagement with indigenous communities (Available in several languages on our website).
A Tlicho government representative examines a bottle of treated water from the water treatment plant at Snap Lake Mine.
De Beers Canada Inc. - 2010 Report to Society 52
At the operations level, stakeholder consultation focuses for the most part on four areas:
(i) benefits in the form of education, training, and business opportunities as well as any applicable financial component;
(ii) impacts and monitoring of these related to the environment;(iii) impacts and monitoring associated with socio-economic
impacts, and(iv) implementation of the various impact benefit agreements.
A fifth step for issues and grievance resolution is applied when required. Other areas that may be addressed (this varies from agreement to agreement) include environmental protection, social and cultural issues, and resolving any disputes that arise. We strive to identify jointly priorities within a community of interest, particularly those that align with the company’s strengths and abilities. At the same time, we recognize that each community is unique and may have individual priorities. Our engagement therefore is sufficiently flexible to accommodate this.
A Corporate Social Investment Policy guides investment in other areas.
Information obtained from stakeholder engagement is used to ensure that plans and mitigation programs are adjusted to accommodate concerns raised through an adaptive management process.
Dialogue is undertaken with affected communities to ensure that any mitigation measures for project related impacts are understood, and that where practical, these are aligned with the community’s priorities.
Both the Snap Lake Mine and the Victor Mine are remote fly-in sites with limited winter road access. The closest community to each of these mines is Lutsel K’e which is about 130 km distant (Snap Lake), and Attawapiskat which is about 90 kms away (Victor) respectively. Each mine is situated within lands traditionally used by a number of separate groups of Aboriginal peoples. In the case of Snap Lake, four impact benefit agreements have been concluded and in the case of the Victor Mine, three impact benefit agreements have been concluded. No resettlement of any group has been required for either mine.
There were no incidents of violations involving rights of Aboriginal (Indigenous) people during the year.
There are formal Impact Benefit Agreements (IBA) with four groups near the Snap Lake Mine (Tlicho Government, Yellowknives Dene First Nation, North Slave Métis Alliance and the Lutsel K’e and Kache Dene First Nation). There are three IBAs in place with four First Nations for the
Victor Mine (Attawapiskat First Nation, Moose Cree First Nation and a jount agreement with both Fort Albany First Nation and Kashechewan First Nation). There is a Working Relationship Agreement with a fifth First Nation for the Victor Mine.
The total financial benefits shared under all the agreements in 2010 was $5,231,000.
Contributions to the local economy within the affected communities are also achieved through business opportunities for the supply of goods, materials and services, and through the supply of labour.
An important long-term goal for De Beers Canada is building strong relationships with the communities that we work with. Where an issue or a grievance arises, the practice is to resolve the concern with those able to provide the best solution within the company, often at the first line managerial level. Should a resolution require support from a more senior position, the concern will escalate accordingly. In each instance, a resolution is sought as quickly as is practical, following the principles outlined within the dispute resolution chapter contained with the agreement for that community. Most instances are resolved early and without triggering the formal dispute resolution process located within these agreements.
The sign post at Victor Mine reminds everyone that it’s a small world.
De Beers Canada Inc. - 2010 Report to Society 53
Table 6-2: 2010 community risk assessment
Risk Mitigation
Failure to obtain social licence to operate in key areas – stemming from inadequate resources to ensure Free Prior Informed Consultation prior to exploration.
Develop strategy for engagement with higher level political bodies. Develop strategy to address Traditional Territory boundaries / overlap.
Aggrieved elements or entire communities disrupt logistics route. Improve relationship management and information gathering. Implement IBAs more effectively. Consider new winter road.
Inability to obtain access to land due to lack of support from local Aboriginal communities.
Stakeholder engagement plan to be implemented in full.
Implementation of Snap Lake or Victor agreements. Deliver commitments. Develop ways to address poor participation by communities and/or by poor performance by the economy.
Delays in the development of the Gahcho Kué Project due to challenges by communities related to Crown consultation.
Ensure Environmental Assessment related consultation is as thorough and extensive as practical and that the Crown is kept informed regarding progress and action identified gaps.
Permitting Manager Paul Cobban, right, leads a tour of the Gahcho Kué Project site for Tlicho Government representatives in September 2010.
De Beers Canada Inc. - 2010 Report to Society 54
Table 6-3: Communities of interest
StakeholderStakeholder Category
Area of Interest
Type of engagement
Federal government
CanNor for Economic Development Government - federal M F
Department of Fisheries and Oceans Government - federal C, M, E
Environment Canada Government - federal M F
Indian and Northern Affairs Canada Government - federal C, M, E C, F, L, T
Natural Resources Canada Government - federal C, M, E T
Northern Project Management Office (NPMO) Government - federal M F
Government of the NWT Government - territorial C, M, E
Ministry of Industry, Tourism, and Investment Government - territorial M, E
Ministry of Environment and Natural Resources Government - territorial M, E
Ministry of Education, Culture and Employment Government - territorial M, E
Government of Ontario Government - provincial C, M, E
Ministry of Aboriginal Affairs Government - provincial M, E F
Ministry of Natural Resources Government - provincial M, E F, L
Ministry of Northern Development, Mines and Forestry Government - provincial M, E F, L, T
Ministry of Finance Government - provincial M C
Mining Division - Snap Lake Mine
Deninu Kué First Nation Aboriginal C, M, E C, L, M
Lutsel K’e and Kache Dene First Nation Aboriginal M, E C, L, M, T
North Slave Métis Alliance Aboriginal M, E C, L, M
NWT Métis Nation Aboriginal M, E C, L, M
Tlicho Government Aboriginal M, E C, P, L, T
Yellowknives Dene First Nation Aboriginal M, E C, L, T
City of Yellowknife Government - local M, E C
Mining Division - Victor Mine
Attawapiskat First Nation Aboriginal C, M, E C, F, L, M, P, T
Fort Albany First Nation Aboriginal M, E M, P
Kashechewan First Nation Aboriginal M, E M, P
Moose Cree First Nation Aboriginal M, E M, P
Taykwa Tagamou Nation Aboriginal M L
Mushkegowuk Council Aboriginal M, E C, M, P
Town of Moosonee Government - local M, E L
City of Timmins Government - local M, E L, F
Town of Cochrane Government - local M
Exploration Division
Kitchenuhmaykoosib Inninuwug Aboriginal E C, T
Bearskin Lake First Nation Aboriginal E C, L, T
Wapekeka First Nation Aboriginal E C, T
City of Sudbury Government - local M, E C
Nishnawbe Aski Nation Aboriginal M, E C, F, T
Note: Area of Interest: C = Corporate; M = Mining; E = Exploration Type of engagement: C = Correspondence; F = Face-to-face meeting; L = Meeting with leadership; M = committee; P = Public meeting; S = Meeting with specific community segment; T = Telephone
On average, we met with the membership of the four prime Communities of Interest (COI) for Snap Lake two times in 2010, and with the prime communities of interest for Victor ranged from two to five times per year. There were frequent and numerous exchanges of letters and e-mails with all of these communities.
Considerable difficulty was encountered during 2010 with two COI that refused to meet or engage in consultation with the company about exploration. Attempts continue to resolve this issue.
Key COI for the Snap Lake Mine are the four communities that have IBAs with us and the government of the Northwest Territories. Key COI for the Victor Mine are the four communities that have IBAs with us and the various Ontario government ministries. Key COI for exploration are the communities that we are working with for exploration, and those where we are building relationships for future exploration.
A student from Deninu School presents a certificate and drawing to De Beers Canada representatives, from left, Snap Lake Mine General Manager, Brad Corrigan; Director, External & Corporate Affairs, Cathie Bolstad; and Superintendent, Human Resources and Administration, Gaeleen MacPherson; commemorating the first Books in Homes visit to the School in June 2010.
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Table 6-3: Communities of interest
StakeholderStakeholder Category
Area of Interest
Type of engagement
Non-government organizations
Mining Association of Canada Industry organization C, M, E C, M, T
NWT/Nunavut Chamber of Mines Industry organization C, M, E C, M, T
Ontario Mining Association Industry organization C, M, E C, M, S, T
Prospectors and Developers Association of Canada Industry organization C, M, E C, M, P, S, T
Assembly of First Nations Aboriginal C C
Canadian Business for Social Responsibility Industry organization C C, F, P, T
Canadian Aboriginal Minerals Association Aboriginal C, M, E C, P
Conference Board of Canada (Council on Corporate Aboriginal Relations)
Industry organization C C, M, S, T
Canadian Institute of Mining and Metallurgy (CIM) Industry organization C, M, E C, F, L, M, P
World Wild Life Fund Non-governmental Organization
C, M, E C
Canadian Boreal Initiative Non-governmental Organization
C, M, E C
Status of Women Council of the NWT
Mine Training Society F, M, T
Note: Area of Interest: C = Corporate; M = Mining; E = Exploration Type of engagement: C = Correspondence; F = Face-to-face meeting; L = Meeting with leadership; M = committee; P = Public meeting; S = Meeting with specific community segment; T = Telephone
Agreements signedNo new agreements were signed in 2010.
Agreement implementationImplementation of the four IBAs for the Snap Lake Mine continued throughout the period, and implementation of the three IBAs for the Victor Mine also advanced during the year. Currently there are signed and ratified agreements with the Tlicho Government, the North Slave Métis Alliance, the Yellowknives Dene First Nation and the Lutsel K’e and Kache Dene First Nation for Snap Lake. Agreements are signed and ratified with the Attawapiskat First Nation, the Moose Cree First Nation, and the Fort Albany First Nation and Kashechewan First Nation for Victor. In addition, there is a Working Relationship with the Taykwa Tagamou Nation for Victor. The latter relates to the project-related hydro line that crosses this nation’s traditional lands.
An analysis was undertaken during 2010 to identify any gaps that relate to the nature, scope and effectiveness of our programs and practices that assess and manage the impacts of our operations on communities, including entering, operating and exiting. The current reporting and practices were compared against the requirements for the Socio-Economic Assessment Toolbox (SEAT) used by Anglo American plc. Snap Lake has a separate socio-economic agreement, and the only weaknesses relate to updated community profiles. Victor does not have the same statutory reporting requirements as Snap Lake because it is in Ontario. Up-to-date community profiles are also required, and there are no other significant gaps. Information is widely spread through a number of different reports, and is not collated in a single place. Further analysis will be undertaken in 2011 to determine whether any additional work is required in this area.
Community, economic, environmental, health and safety, and social performanceBoth the Snap Lake and Victor Mines have procurement policies with preference for local suppliers.
In the exploration area, opportunities are much smaller. Nevertheless, De Beers Canada endeavours wherever practical and cost effective to involve local communities in the supply of goods and services, especially where this can be done in a fashion that helps build local capacity.
One such method currently being considered is to break down large contracts into smaller individual segments without causing a significant increase in costs to the company. However, this is proving difficult.
Project and mine management is regularly encouraged to find innovative ways to increase the opportunities for local economic participation for the supply of goods and services. Staff members work with external institutions to help deliver workshops on creating and enhancing entrepreneurial start ups, and on future opportunities.
The procurement expenditure by De Beers Canada and its contractors with local communities is monitored on a monthly basis and compared to the procurement plan. Where there are negative deviations from the plan, corrective actions are initiated to keep or to return to the plan. However, during operations, opportunities for new contracts are very limited.
Internal auditing of progress is undertaken at the end of each month and at the end of each quarter by the mine business development and aboriginal affairs staff, and by the mine executive committee. Their findings are reported to the De Beers Canada Corporate Executive Committee.
The Attawapiskat First Nation requested the company to make a proposal to assist the First Nation on two occasions. The first was to assist with the management of the construction of a new elementary school, and the second was to assist with preparation of a housing plan to update a pre-existing plan. The First Nation rejected both the proposals that were prepared. The company remains prepared to assist COI where we can.
De Beers Canada Inc. - 2010 Report to Society 56
Table 6-4: Key communities of interest perspectives
Community of Interest
Who is included
Why are they important to DBCI
What are their main issues
How has the company addressed these issues
What are the outcomes (metrics)
Snap Lake Mine
Lutsel K’e and Kache
Dene First Nation
All members of
the LKDFN
• Snap Lake Mine is within
lands traditionally used by
the LKDFN
• Snap Lake has an IBA
with the LKDFN with
commitments by each
party to the other
1. Employment
2. Education and training
3. Business Opportunities
4. Environmental
protection
5. Cultural protection
6. Health & Wellness
7. Financial benefit
All 7 issues are covered in the IBA
and in an Environmental Agreement
in which LKDFN is a signatory. In
addition, ongoing dialogue and public
community meetings help address
emerging issues.
Currently there are no significant
outstanding issues: 7 persons
are directly employed, 1 person
is currently in apprenticeship or
internship programs; business
contracts totalled $4,417,460
in 2010, and financial benefits
flowed as per the IBA.
North Slave Métis
Alliance
All members of
the NSMA
• Snap Lake Mine is within
lands traditionally used by
members of the NSMA
• Snap Lake has an IBA
with the NSMA with
commitments by each
party to the other
1. Employment
2. Education and training
3. Business Opportunities
4. Financial benefit
All 4 issues are covered in the IBA with
NSMA. In addition ongoing dialogue
and public community meetings help
address emerging issues. The NSMA is
also a signatory to the Environmental
Agreement.
Currently there are no significant
outstanding issues: 9 persons
are directly employed, 3 persons
are currently in apprenticeship
or internship programs; business
contracts totalled $1,688,595
in 2010, and financial benefits
flowed as per the IBA.
Tlicho Government All the Tlicho
citizens
• Snap Lake Mine is within
lands traditionally used by
the TCG
• Snap Lake has an IBA with
the TCG with commitments
by each party to the other
1. Employment
2. Education and training
3. Business Opportunities
4. Environmental
protection
5. Cultural protection
6. Financial benefit
All 6 issues are covered in the IBA
with TCG and in an environmental
agreement in which the Tlicho
Government is a signatory. In
addition ongoing dialogue and public
community meetings help address
emerging issues.
Currently there are no significant
outstanding issues: 59 persons
are directly employed, 3 persons
are currently in apprenticeship
or internship programs; business
contracts totalled $24,031,428
in 2010, and financial benefits
flowed as per the IBA.
Yellowknives Dene
First Nation
All members of
the YKDFN
• Snap Lake Mine is within
lands traditionally used by
the YKDFN
• Snap Lake has an IBA
with the YKDFN with
commitments by each
party to the other
1. Employment
2. Education and training
3. Business Opportunities
4. Environmental
protection
5. Cultural protection
6. Financial benefit
All 6 issues are covered in the IBA with
YKDFN. In addition ongoing dialogue
and public community meetings help
address emerging issues.
Currently there are no significant
outstanding issues: 23 persons
are directly employed, 5 persons
are currently in apprenticeship
or internship programs; business
contracts totalled $13,506,258
in 2010, and financial benefits
flowed as per the IBA.
De Beers Canada Inc. - 2010 Report to Society 57
Table 6-4: Key communities of interest perspectives
Community of Interest
Who is included
Why are they important to DBCI
What are their main issues
How has the company addressed these issues
What are the outcomes (metrics)
Victor Mine
Attawapiskat First
Nation
• Victor Mine is within lands
traditionally used by the
AttFN
• Victor has an IBA with the
AttFN with commitments
by each party to the other
1. Employment
2. Education and training
3. Business Opportunities
4. Environmental
protection
5. Cultural protection
6. Financial benefit
All 6 issues are covered in the IBA with
AttFN. In addition ongoing dialogue
and public community meetings help
address emerging issues.
Currently there are no significant
outstanding issues: 78 persons
are directly employed, no
persons are currently in
apprenticeship or internship
programs; 2 persons are
in management or trainee
programs; business contracts
totalled $39,366,428 in 2010, and
financial benefits flowed as per
the IBA.
Fort Albany First
Nation
• The winter access road for
Victor Mine crosses lands
traditionally used by the
FAFN
• Victor has an IBA with the
FAFN with commitments
by each party to the other
1. Employment
2. Education and training
3. Business Opportunities
4. Environmental
protection
5. Cultural protection
6. Financial benefit
All 6 issues are covered in the IBA with
FAFN. In addition ongoing dialogue
and public community meetings help
address emerging issues.
Currently there are no significant
outstanding issues: 14 persons
are directly employed, no
persons are currently in
apprenticeship or internship
programs; business contracts
totalled $4,110,929 in 2010, and
financial benefits flowed as per
the IBA.
Kashechewan First
Nation
• The winter access road for
Victor Mine crosses lands
traditionally used by the
KFN
• Victor has an IBA with the
KFN with commitments by
each party to the other
1. Employment
2. Education and training
3. Business Opportunities
4. Environmental
protection
5. Cultural protection
6. Financial benefit
All 6 issues are covered in the IBA with
KFN. In addition, ongoing dialogue
and public community meetings help
address emerging issues.
Currently there are no significant
outstanding issues: 9 persons are
directly employed, no persons
are currently in apprenticeship
or internship programs; business
contracts totalled $4,108,929
in 2010, and financial benefits
flowed as per the IBA.
Moose Cree First
Nation
• The winter access Road
for Victor Mine crosses
lands traditionally used by
the KFN
• The marshalling yard for
supplies in Moosonee lies
within lands traditionally
used by the MCFN
• Victor has an IBA with the
LKDFN with commitments
by each party to the other
1. Employment
2. Education and training
3. Business Opportunities
4. Environmental
protection
5. Cultural protection
6. Financial benefit
7. Disposal of timber in
stockpiles along hydro
right of way
The first 6 issues are covered in the
IBA with MCFN. In addition, ongoing
dialogue and public community
meetings help address emerging issues.
The stockpiled timber issue remains.
Permit conditions stipulated that
De Beers should pile timber neatly for
salvage by community members: MCFN
demands that all timber be hauled back
to their community. DBC has done what
it can over the past 3 years and does
not have the resources to do more.
Currently there are no significant
outstanding issues: 13 persons
are directly employed, no
persons are currently in
apprenticeship or internship
programs; business contracts
totalled $1,292,410 in 2010, and
financial benefits flowed as per
the IBA. MCFN plans to burn the
remaining piled timber because
in its opinion, the piles are
unsightly.
De Beers Canada Inc. - 2010 Report to Society 58
Table 6-4: Key communities of interest perspectives
Community of Interest
Who is included
Why are they important to DBCI
What are their main issues
How has the company addressed these issues
What are the outcomes (metrics)
Exploration
Bearskin Lake First
Nation
The traditional lands of BLFN
occupy an area that DBC
would like to explore
1. Protection of Aboriginal
& treaty rights
2. Community support
3. Employment
4. Prerequisite Land Use
Plan
5. Training and education
6. Environmental
protection
7. Business opportunities
8. Financial benefit
DBC met with the BLFN leadership
and held a community meeting. The
community indicated after the meeting
that it is not ready for any mineral
exploration.
Zero progress in 2010
Kitchenuhmaykoosib
Inninuwug
The traditional lands of KI oc-
cupy an area that DBC would
like to explore
1. Adherence to KI
protocols
2. Recognition of
indigenous rights,
jurisdiction and control
over its territory
3. Adherence to Free Prior
Informed Consent,
protection of biodiversity,
pollution prevention,
mitigation of historical
pollution issues and a
general respectful and
inclusive consultative
approach,
DBC discussed possible exploration
in 2011 with the lands and resources
Director, and submitted a draft proposal
for consideration as a prelude to
advising provincial government of its
plans so that government could start
consultations. KI indicated that it was
not ready for any mineral exploration
and outlined 14 issues that will have to
be addressed. Some of these are issues
for KI and government to address. Most
of the remaining issues are not issues
from De Beers’ perspective as they are
within our existing operating pactices
and policies .
Zero progress in 2010.
Wapekeka First Nation The traditional lands of WFN
Nation occupy an area that
DBC would like to explore.
Within the WFN traditional
lands there are 7 claim blocks
held by DBC which the
company has been unable
to access since 2003 because
of opposition from the
community.
1. Protection of the
environment
2. Protection of traditional/
heritage values
3. Refusal to meet for
discussions without
direction from
community
4. Community reluctant
to support exploration
without meeting and
dialogue
De Beers has made several attempts
to start a dialogue with the WFN
leadership as a prelude to a community
meeting. The leadership refuses to meet
without a directive from the community
and the community refuses to provide
a directive as it does not know enough
about the reasons for a meeting. This is
a circular argument. De Beers is looking
at alternatives to move forward with
WFN.
Zero progress in 2010.
De Beers Canada Inc. - 2010 Report to Society 59
The role of our purpose, vision and values in how we work with our Communities of InterestThe Purpose, Vision and Values help form the foundation of our relationship with our COI and guide our decision making in all matters for De Beers Canada. Employees of De Beers Canada and the De Beers Family of Companies are committed to living our values every day.
We believe that these are important and guide our relationships both within the company and in our relationships with communities of interest. It is not enough for us to say what our vision, principles and values are: we have to live them and demonstrate that we walk the talk. This is not easy, and we have each to hold our colleagues accountable. It is by putting our vision, principles and values into daily practice, and to be seen to be doing so that we can lead by example and prove that we say what we do, and do what we say.
Issues raised, grievances, and disputes The following significant issues were raised by communities or interested parties affected by one of the mines or by exploration activities. Most disputes are resolved prior to reaching a formal grievance procedure. In some instances, the procedure has advanced to the first or the second formal step. The second step is a meeting between the First Nation Chief and the company CEO to discuss the issue.
An interpreter translates information for an elder from the Tlicho Government, visiting Snap Lake Mine in the summer of 2010.
De Beers Canada Inc. - 2010 Report to Society 60
Table 6-5: Community issues and themes
Issue / Theme Response Results / Status
The Deninu Kué First Nation has expressed concern that the Company should be providing an Impact Benefit Agreement for the Snap Lake Mine.
The Company has outlined all of the factors it used in determining which communities would be offered an IBA and has advised the DKFN that impacts and potential impacts of the mine are addressed for the DKFN in permit and license conditions, and other tools such as the Socio Economic and Environmental Agreement. The company has offered the DKFN a training agreement and has added the community of Ft. Resolution to its annual “Books in Homes” literacy program.
The DKFN has expressed an intention to use the permitting process on De Beers’ upcoming Land Use Permit renewal as a means to obtaining an Impact Benefit Agreement.
Representatives from a variety of communities have expressed concern that mining may be causing a decline in the caribou population and have asked De Beers to ensure its activities don’t contribute to the decline.
De Beers has outlined how it mitigates its impact on caribou and confirmed there would be an opportunity to work more closely with the company with respect to its caribou monitoring programs in the fall.
De Beers coordinated a caribou camp in the fall with elders and the Snap Lake Environmental Monitoring Agency to ensure ongoing dialogue with elders regarding Snap Lake caribou monitoring programs. The company also participated with the other two NWT Diamond Mines in a workshop on October 5th and 7th that enabled community representatives and Traditional Knowledge holders to have input on the three diamond mines wildlife monitoring programs for 2011.
Snap Lake MineThe Snap Lake Mine did not encounter any significant disputes relating to land use or customary rights by local indigenous peoples in 2010 however in engaging communities regarding the Snap Lake Land Use Permit application, a number of important issues were raised with the company.
A member of J Fish, a hip hop dance team based in Medicine Hat, Alberta, performs for students in Whati in January 2010. De Beers Canada sponsored the visit as part of the Aboriginal Sport Circle.
De Beers Canada Inc. - 2010 Report to Society 61
Table 6-5: Community issues and themes
Issue / Theme Response Results / Status
GNWT is concerned that De Beers is not achieving its Socio-Economic Agreement Commitments for 60% employment being the employment of NWT Residents.
The Company participated in a survey with GNWT Bureau of Statistics in 2009 and 99% Snap Lake employees participated. The biggest barrier to achieving the target is lack of skilled workers in the NWT, low literacy levels in unemployed workers and high cost of living in NWT which is preventing relocation of southern workers to the NWT. The company is working with the other two diamond producers and the GNWT through a Memorandum of Understanding to recruit, retain and develop a northern workforce. In 2010 De Beers participated with the GNWT in a joint response to employee survey results, in a Canadian wide Campaign to attract skilled workers to the NWT. The Program was called “Come Make Your Mark”.
De Beers continued to partner with the Mine Training Society and Aurora College to train underground miners, apprentices and Process Plant Operators in 2010.
Communities are concerned about the proximity of De Beers’ fuel storage to Snap Lake and seek assurances there is a spill management plan in place to protect the environment.
De Beers has shown communities its fuel storage area, including the lined bermed area that can hold 110% of the largest tank in the event of a spill. The company has outlined its spill prevention and contingency plans and has shown where reporting of spills takes place. Where communities are not able to see this first hand on site, De Beers provides photographs as part of presentations and in response to questions.
There is an increased understanding of the measures in place to protect the environment from spills, including fuel spills.
Representatives from communities have raised concerns about how water from the North Pile on surface is being handled, seeking assurances the water being put back in Snap Lake is safe and will not harm the aquatic life.
De Beers has provided site tours to the North Pile, and has shown how sumps and water systems ensure water from the North Pile is routed to the Water Treatment Plant before release to Snap Lake. Tours and demonstrations of the Water Treatment Plan and how it works were provided on site in 2010 and more demonstrations are planned in 2011 as part of community workshops.
Communities were invited in 2010 to participate with De Beers in technical workshops regarding the Aquatic Effects Monitoring Plan and in a review of monitoring results. Results for a five year period were summarized and presented to regulators and communities in 2010 and opportunities to improve the AEMP have been discussed with communities and regulators.
Communities are concerned that the company must have a solid plan for progressive reclamation and closure and enough security set aside to cover the costs of closure and reclamation as a safety net.
The company has hosted a number of community delegations at the mine site in 2010 to show them how the mine site is being managed, and has given communities notice that the reclamation and closure plan will be reviewed with them in 2011 and updated with their input.
Communities have welcomed the opportunity to come to site to see how the processed kimberlite containment facility is working and to see how De Beers is managing its use of the land. A workshop on closure and reclamation has been planned in Yellowknife for May 4, 2011. Communities and regulators will be invited to participate.
De Beers Canada Inc. - 2010 Report to Society 62
Victor MineAt Victor, there were several disputes.
Table 6-5: Community issues and themes
Issue / Theme Response Results / Status
Complaints by community members from Attawapiskat that they are not provided information by their leadership about what is happening with regards to the Victor Mine and to the community.
The company has increased its community engagement in Attawapiskat through additional meetings, increased presence in the community, more use of radio and the community TV channel and through introduction of a newsletter delivered to every household in order to raise the flow of information about the mine. The company is unable to address communications by the community’s leadership to their membership. We have urged the leadership to increase the frequency and depth of its communications with its members.
There are many frustrated individuals in Attawapiskat who still assert that they are not receiving enough information, particularly from their leadership. The company will continue to urge the leadership to address this. The company will also increase its engagement further.
Assertions by Attawapiskat First Nation members of discrimination.
The company has investigated all allegations brought to its attention in 2010 by those affected using qualified investigators. These allegations covered a period of __ years and also included allegations sbout contracts.
Five cases were investigated at Victor in 2010. Updates are reviewed at the Senior Implementation Management Committee table to deal with issues as they arise.
Dissatisfaction of some Attawapiskat First Nation members with IBA benefits. Demands for significantly increased financial benefits.
Provided information on the IBA content and encouraged the First Nation leadership to work with the company to educate the community members about the direct and indirect benefits. The mine has a short life, and construction capital is not recovered until late in year 7. The community negotiated for a deal with annual cash payments, and the quantum of these will increase once capital has been recovered in line with how well the mine does financially.
Many community members still have many questions after more than five years of explanations. Further education and information is still required and is being planned. Further information on the financial status of the mine may be required to close out this issue.
Dissatisfaction of some Attawapiskat First Nation members with lack of new elementary school in the community after delays of over 9 years.
Although the company is not responsible for infrastructure, and the mine does not have the resources to finance and build a school, the company worked with the community leadership to encourage the federal government to make provision of a new school a high priority. Company has offered to assist with project management for construction of any new school as this is a corporate strength, and the offer was rejected.
Federal government announced in December 2009 that the community is now on the priority list, and that funding for a new elementary school will flow, commencing in 2015.
Lack of housing in Attawapiskat. Capital funds for housing are part of the funding provided by government. The company does not have the financial resources to replace government. Company is working with the community by assisting with an update of its comprehensive community plan for housing. Company has offered to assist with project management for any major housing construction project.
Issue not resolved. Company supported an Aboriginal consultant to work with the community and a long term housing strategy.
Victor Mine employees discuss safe work practices before their shift.
De Beers Canada Inc. - 2010 Report to Society 63
Table 6-5: Community issues and themes
Issue / Theme Response Results / Status
Dissatisfaction of some community members with the Attawapiskat First Nation’s leadership.
This is a matter internal to the community and the company will not become involved. A facilitator was supplied to work with the community to draft a custom governance code including an electoral code. If this is adopted by the community membership, this should resolve many issues in this area.
Since this issue arose the leadership has changed. In addition, support was provided for preparation of a “custom electoral and governance code’ , this was ratified by the community and then rejected by the previous leadership.
Issues with infrastructure for potable water and sewage in Attawapiskat.
Company has offered to look at existing operating and maintenance plans and see if there are improvements that could be incorporated; also offered to develop maintenance schedules, budget guidance plans, and lists of consumables and spares that should be kept in the community; company offered to help train operators at its own facilities at the mine.
Proposal currently still being considered by the community’s leadership and technical staff.
Compensation payments to families from Attawapiskat impacted by Victor Mine.
Company has paid and continues to pay compensation to the First Nation as outlined in the IBA. It was agreed that the First Nation would be responsible for distributing this amongst affected parties as these are in terms of communal rights and the First Nation knows who these are. To the best of our knowledge, none of this compensation is currently flowing to the affected parties. Company is working with the First Nation and its legal counsel to resolve this and has provided legal assistance to the primary affected parties.
Discussions between the First Nation and the affected families were satisfactorily concluded in mid-2010. Compensation payments are now being made to affected parties by the First Nation.
Concern by some members of the Attawapiskat First Nation over possible mercury pollution of potable water supply.
There is pre-existing, naturally occurring high mercury content in the local river water. This was considered during the environmental assessment and considered not to be significant. Nevertheless, a monitoring program has been put in place, together with a multi-year research program to understand the issue better.
Results to date support the predictions made in the environmental assessment. Research and monitoring are continuing.
Demand by Moose Cree First Nation for timber cut during the construction of the new electricity transmission line from Otter Rapids to Moosonee to be salvaged and transported back to Moosonee and Moose Factory. Demand subsequently modified to burn the timber stockpiles.
The permit and approvals issued for this work required the company to stack the cut timber next to the right of way for the transmission line for later recovery by interested parties. Over and above permit requirements, the company provided limited funding in excess of $320,000 from 2008-2010 to assist with recovery of timber.
The company has gone beyond its requirements in its permits and approvals. It does not have the resources to do more than it is currently doing. Timber salvaged in 2010 could not be delivered to Moose Factory because of an early deterioration of the ice road. This will be delivered in 2011. The First Nation has indicated that it will burn the remaining stockpiles.
Moose Cree First Nation refuses to allow use of herbicides within its traditional lands.
It is requirement of the conditions for handover of the new transmission line to the transmission company that the right of way be sprayed with herbicide before any handover. Covenants by First Nation in its IBA undertake to provide Company with continuing and uninterrupted access to facilities including transmission line for construction and operation.
Discussions are close to completion with power transmission authority for an alternative way forward in view of the intransigence of the First Nation.
A series of 28 issues in 162 sub-categories raised by some community members from Attawapiskat following a blockade of the seasonal winter road in 2009.
These issues represent a mixture of issues between the community members and their own leadership, the community members and its leadership and the company, and the community and Indian and Northern Affairs Canada (INAC). It was necessary to disentangle and separate the issues into their main groupings in order to resolve them.
All the issues with the company were resolved early in 2010.
De Beers Canada Inc. - 2010 Report to Society 64
Management Approach - EnvironmentThe overarching environmental strategy remains to work in a responsible manner, using the precautionary principle and adaptive management techniques to minimize negative impacts, prevent adverse environmental effects, including preventing pollution, protect and enhance biodiversity where we work, and to manage energy consumption and minimize greenhouse gas emissions to reduce the negative impact on climate. Water use is to be minimized and recycling maximized: material use is to be to be minimized and wherever practical reuse and recycling is encouraged. Waste production is to be managed and production of wastes reduced where practical; hazardous wastes are to be managed appropriately and disposed of in accordance with legislation and good operating practices. Legal compliance with legislation is imperative.
Our strategy affects not only the environment and its long-term sustainability, but also the ability to secure our social licence to operate as well as reputation.
IntroductionOne of the concerns shared by both our communities of interest and ourselves is environmental protection. We all have to live on the same planet: we all have to use the same water, breathe the same air, use the same plants and animals. We consider this to be a shared and important value.
Our environmental policy was merged with our occupational health and safety policy and our sustainable development policy at the beginning of 2010 to form a new broader-based sustainable development policy. This has allowed us to align these policies and reduce the duplication and improve the overall policy itself. The new sustainable development policy is available on our website. We no longer have a stand-alone environmental policy. We will align our sustainable development strategy and philosophy over the next couple of years with the remainder of the De Beers Family of Companies.
Expenditures for environmental protection and investments are not tracked separately but are grouped with expenses for safety, health and environment.
Environment
Table 7-1: Environmental performance for 2010
Metric MilestoneSnap Lake
MineVictor Mine
Gahcho Kué Project
Exploration DBCI 2010 DBCI 2009
Major incidents1 0 0 0 0 0 0 0
Moderate incidents2 0 2 1 0 0 3 1
Minor incidents3 273 252 115 1 29 284 225
AEIFR4 18.5 35.0 18.6 7.1 49.8 19.3 20.5
Legend1 A reportable environmental incident associated with widespread, long-tem, irreversible negative ecological or social impacts with a high risk of legal liability:
also contains all of the following aspects: complete disruption of natural systems, high degree of irreversibility (>5 years), non-compliant with legislation and high likelihood of prosecution, significant negative public perception, and reportable to the authorities in terms of relevant legislation.
2 An incident associated with a widespread or localized, medium-term, reversible significant ecological or social impact and/or has a risk of legal liability: also contains all of the following aspects: an impact on the natural system, reversible impact within 5 years, non-compliant with legislation, reasonable likelihood of prosecution, potentially negative public perception, incidents likely to be reportable to the authorities in terms of legislation.
3 An incident limited to the immediate area of occurrence associated with a short-term ecological disturbance or environmental nuisance or a transgression of an internal standard including complaints from interested and affected parties): also is entirely reversible impact after once-off intervention, limited impact on natural system, non-compliant with legislation but a low likelihood of prosecution, insignificant or no negative public perception.
4 All Environmental Incident Frequency Rate
Different vegetation is considered as part of a reclamation study conducted by Laurentian University in partnership with Victor Mine.
De Beers Canada Inc. - 2010 Report to Society 65
Both mines and the exploration division have Environmental Management Systems that are certified to ISO14001:2004. Part of the Management System requirements includes training and awareness plans being in place, and implemented. All new hires undergo environmental awareness training. More specific training related to their job and the environmental risk is provided where appropriate according to a training matrix that forms part of the individual environmental management system.
The following graph shows the frequency and size of hydrocarbon spills during 2010.
Number of spills from 2008-2010
50 100 150 200 250
2008
2009
2010
Figure 7-1: Environmental spills
Figure 7-2: Number of hydrocarbon spills by volume and by frequency (2008-2010)
60
55
50
45
40
35
30
25
20
15
10
5
0-2 3-10 11-100 101-200 201-400 401-600 601-1000 >1000
1.0
0.9
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.1
2008 2009 2010
Legend:
Volume (litres)
FrequencyN
umbe
r of s
pills
Environmental monitoring near Victor Mine.
De Beers Canada Inc. - 2010 Report to Society 66
Both mines had goals of achieving a Level 3 in the Towards Sustanable Mining initiative. The criteria follow a five-level performance rating scale where 1 is low and 5 is high. Level 3 is taken to indicate that the necessary systems and processes are developed and implemented to allow effective management to occur, and this is the initial goal for the Mining Association of Canada for its members. Levels 4 and 5 indicate a higher performance level, and members are encouraged to reach for a Level 5 through a process of continuous improvement over time.
Table 7-2: 2010 corprate environmental goals and objectives
Goal Degree achieved Successes Shortcomings Additional remarks
Reach conformance with the De Beers Family of Companies’ 6 standards for environmental management.
Four standards, over 80% implemented.
Four standards implemented for(i) Life Cycle Planning,(ii) Water,(iii) Pollution and Waste
Management, and(iv) Environmental
Reporting;effectively in place.
Two standards for biodiversity action plans and climate change risk analysis well advanced.
Improve change and risk management.
Procedures implemented based on corporate standard.
Integrated procedures into work practices.
Ensure continual robust application of procedures.
Muskeg surrounding the Victor Mine site.
De Beers Canada Inc. - 2010 Report to Society 67
Table 7-3: 2010 Snap Lake Mine environmental goals and objectives
Goal Degree achieved* Successes Shortcomings Additional remarks
Achieve a Level 3 for TSM at Snap Lake in all 4 areas.
• Crisis Management** one criterion ‘Yes’ and two ‘No’
• Tailings management four criteria level 2 and two level 1
• External and Aboriginal outreach level: one criterion level 5, two criteria level 4 and one criterion level 3
• Energy and greenhouse gas emissions management four criteria level 2 and two criteria level 1
Crisis Management lacked plan implementation and annual risk review. Energy and Greenhouse Gas emissions level “1” for Energy intensity performance target and Greenhouse gas emissions intensity performance target.
Work is planned to raise all the assessment criteria to level 3 or above.
Reduce number of Spills; Improve incident reporting.
In 2009 we had 29 reportable spills, in 2010 we only had 16, 45% reduction in reportable spills.
With the construction of the new permanent accommodation we reduced overall grey water spills.
We still require increased awareness of negative impacts of spills, especially with the water license application in 2011.
In 2010 we stopped reporting raw water/potable water spills as per the letter from the regulatory Inspector. A portion of the reduced spills is likely caused by this change in reporting structure.
Zero wildlife deaths caused by mine activities.
100% In 2010 we had no wildlife deaths caused by mine activity. Deterrent methods were effective.
Work needs to be done to improve waste segregation and storage to prevent attracting wildlife.
Reduce Resource Wastage/Shipment of Waste off- site.
50%
In 2009/2010 37 loads (super B trailers) were back hauled.
Improved recycling programs (ie burning waste oil program).
Useable materials continue to be thrown into the landfill; further awareness training required to address disposal, storage and processing of materials.
For future, estimate the volumes of materials sent to the landfill and winter road back haul.
Meet Water Quality Guidelines. 0% Engineered design for a new diffuser accepted, to be constructed in 2011.
Nine non conformances in 2010 (elevated TSS and faecal coliforms).
Submit land use permit application.
100% Finished successful community visits.
Submit final land use permit application.
There is an opportunity to improve communication throughout the permit application process, both internally and with regulators.
Experience will be helpful in successfully applying for a water license permit.
* Based on a verified assessment at the end of 2010/beginning of 2011.
** Crisis Management is graded as “Yes” or “No”.
De Beers Canada Inc. - 2010 Report to Society 68
Environment at Snap Lake MineThe Snap Lake Mine is situated within Barren Lands of the NWT. This is an extensive tundra landscape with till sheets, extensive boulder fields (felsenmeer) and outcrops of gneisses, metavolcanics and granites. There is some exploration in the region around the mine by third parties outside the lease area to explore for minerals. There is currently no exploration within the Snap Lake lease area. There are no other operations or planned operations within a protected or sensitive area. There are no International Union for Conservation of Nature (IUCN) Red List species or habitats in the immediate vicinity of the Snap Lake Mine.
There were two incidents of non-compliance with any applicable international declarations, conventions or treaties, national, regional or local regulations associated with environmental issues. The first relates to an operational review completed as part of planning for the renewal of the mine’s Water License which identified risks associated to the functioning of the pipeline and diffuser used to convey and mix treated water - collected from the underground workings, processed kimberlite disposal and surface run-off – into Snap Lake. This pipeline and diffuser system is not operating according to the original design objective due to entrainment of air within the pipeline, which causes the pipeline to move towards the water surface. The mine maintenance department drilled holes near the shore to release entrained air; however, these modifications prevent proper mixing and have created a second discharge point. The pipeline and diffuser system will be replaced in 2011 to ensure ongoing compliance with regulatory approvals, capacity to discharge water to Snap Lake, and mitigate potential claims for additional fish habitat compensation.
The second relates to an operational review completed as part of planning for the renewal of the mine’s water license which identified a non-conformance with the current Closure and Reclamation Plan approved by the regulators, which requires that the mine undertake progressive reclamation. The Closure and Reclamation plan is currently being updated together with the financial assurance model. This will provide a basis for initiating progressive reclamation and recovering equivalent assurance funds.
In addition, there were two moderate spills at Snap Lake during 2010. The first relates to approximately 662,000 litres of water being transferred from a water collection sump during the spring thaw to Snap Lake with elevated amounts of suspended solids. The water was tested to ensure it met all discharge requirements of the Water Licence prior to commencing the discharge; however, during the pumping operation, increased flow into the sump went undetected and created turbulence, which in turn, increased the amount of suspended mud particles in the
sump water. A root-cause analysis was completed to identify corrective actions required to prevent a recurrence. The investigation was reviewed as a significant incident by the SHE committee for DBCI. The regulatory agencies were informed and no enforcement action was taken.
The second incident relates to a sump used to capture drainage from the processed kimberlite containment, which overflowed onto an access road. A root-cause analysis was completed to identify corrective actions required to prevent a recurrence. The regulatory agencies were informed and no enforcement action was taken.
Neither of these spills triggered Emergency Preparedness procedures.
In addition, there were 252 minor incidents, 94% of which were less than 100 litres, reflecting the high level of awareness and reporting of relatively minor incidents.
No materials were used that were either processed or unprocessed wastes from sources external to De Beers Canada.
Energy use for Snap Lake totalled 96,195,109 KWh, and all of this was direct energy from diesel generation on site.
Table 7-4: Materials use at Snap Lake Mine for 2010
Material Unit Amount How measured
Ferrosilicon Tonnes 156 Direct reading
Oils & hydraulic fluids Litres 137,921 Direct reading
Grease Kilograms 8,650 Estimated
Sulphuric acid Litres 16,440 Direct reading
Oxygen Cubic metres 738.3 Direct reading
Argon Cubic metres 400.76 Direct reading
Nitrogen Cubic metres 84.6 Direct reading
Cleaning solvent Litres 1640 Direct reading
Degreaser Kilograms 21.5 Estimated
A view from Snap Lake Mine’s walking trail.
De Beers Canada Inc. - 2010 Report to Society 69
Table 7-5: 2010 Victor Mine environmental goals and objectives
Goal Degree achieved* Successes Shortcomings Additional remarks
Achieve a Level 3 for TSM at Victor in all 4 areas.
• Crisis Management all three criteria ‘Y’
• Tailings management five criteria level 3 one at level 2.
• External and Aboriginal Outreach one criteria level 4, and three criteria level 3
• Energy and greenhouse gas emissions management four criteria level 2 and two criteria level 1
Achieved target for Crisis Management and External and Aboriginal Outreach.
Energy and Greenhouse Gases Energy intensity performance target and Greenhouse gas emissions intensity target which are both level 1.
Work is planned to raise all the assessment criteria to level 3 or above.
All Environmental Incident Frequency Rate target of 20.0 or less set in 2008.
Achieved 18.6 by end of 2010
Formed a team to address spills reduction and elimination. Hydraulic hose failure indentified as high frequency incident and joint team with manufacturer and maintenance representatives came up with a solution.
Diesel fuel reduction in usage: a fuel consumption tracking system has been purchased and implemented.
In progress. Analysis of the data in 2012 will identify opportunities for improvement. Fuel usage is tracked for each piece of mobile equipment.
* Based on a verified assessment at the end of 2010/beginning of 2011.
** Crisis Management is graded as “Yes” or “No”.
Exploration conducts a field program in the Hudson Bay Lowlands to understand the glacial history of the area.
De Beers Canada Inc. - 2010 Report to Society 70
Environment at Victor MineThe Victor Mine is situated within the James Bay Lowlands, an area of extensive wetlands or muskeg, forming part of the James Bay – Hudson Bay Lowlands. There is some exploration in the area around the mine to explore and evaluate the adjacent kimberlites for possible resources to extend the life of the mine. There are no other operations or planned operations within a protected or sensitive area. There are no IUCN Red List species or habitats in the immediate vicinity of the Victor Mine.
No materials were used that were either processed or unprocessed wastes from sources external to De Beers Canada.
There were no major spills of chemicals, oils or fuels during 2010 at Victor. There was one moderate spill of about 3,500 litres of diesel when a front-end loader came into contact with a fuel tanker. The spill was contained within the ramp to the primary crusher and cleaned up to the satisfaction of the regulators and the Attawapiskat First Nation. Contaminated soil will be treated through bio-remediation on-site. A root-cause analysis was completed to identify corrective actions required to prevent a recurrence. The investigation was reviewed as a significant incident by the SHE committee for DBC. None of the diesel reached the natural environment.
Emergency response and management procedures were triggered for the above incident.
There were no incidents of non-compliance with any applicable international declarations, conventions or treaties, national, regulations associated with environmental issues.
In addition, there were 115 minor spills during the year as a result of mechanical failures on the mobile mining equipment, most specifically hydraulic hoses. Victor Mine now uses specially designed hydraulic hoses to help mitigate against spills.
StrategyBoth of the mines operated by De Beers Canada in Canada are remote, with seasonal access by road for usually less than 60 days. The short time for access and the distance to recycling depots make it challenging to
recycle many materials. Recycling is thus limited. All hazardous wastes are removed from the sites for disposal at licensed hazardous waste disposal sites.
The largest volumes of wastes produced are waste rock from the mining and processed kimberlite material in the form of coarse sand to gravel sized particles, and a fine sand-sludge. Transport costs from the mine site to other potential users preclude reuse of this material. Where practical, inert waste rock may be crushed and used as aggregate or fill for construction and road building.
We use management systems to manage and control our approach to the environment. Risks are regularly assessed and reviewed, and are used in identifying environmental management plans. We continue to encourage proposals from affected communities about collaborating to incorporate Traditional Ecological Knowledge into our approach to environmental management.
Strategy – Snap Lake MineThe strategy for 2010 for Snap Lake was to plan and complete community engagement information sessions related to our Land Use Permit and Water License Renewal prior to the application process in October for the Land Use permit, and the second quarter of 2011 for the Water License Renewal.
The land use permit has to be renewed every five years, and is a requirement for leasing land from the Crown. The community engagement for all communities of interest is a key requirement. This also provides a good opportunity to spend time in the communities and understand their concerns, ask questions and develop a relationship that is trusting and genuine.
Community meetings, stakeholder information sessions and site visits were all used to disseminate information about the mine, provide updates on new developments and understand what information was required by our communities of interest. A record of community engagements was completed and forms part of the land use permit application that was submitted in September to the Mackenzie Land and Water Board. This application has now been circulated to all the communities of interest for review.
Work on the Water Licence renewal is continuing and the process followed is similar. More technical models and information sessions are required, and there are tighter deadlines. The water licence expires in April 2012.
Operations at Victor Mine
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BiodiversityBiodiversity plans are required for both the Snap Lake Mine and the Victor Mine (100% of our operations require biodiversity plans). The Canadian Business and Biodiversity Council (CBBC) was retained to review the Snap Lake and Victor environmental programs and provide training on how to incorporate existing programs into the biodiversity context.
The current activities do not endanger the biodiversity of the mine areas significantly because each of the two mine areas is a small part of a much larger biodiversity region. Currently two specific biodiversity management plans are in place and biodiversity is addressed through the general environmental management plans rather than through separate specific plans. Monitoring of potential impacts on surrounding ecosystems is in place at both mines. Should any indications of significant impacts be noted, appropriate adaptive management action would be undertaken. A thorough review of our biodiversity activities was undertaken during 2010 and we are preparing detailed biodiversity plans for release in 2011.
Biodiversity plans for Victor include several foci. First is for the monitoring and assessment of caribou in the Victor Mine study area to determine the effect, if any, that the project may have on the caribou. This monitoring and assessment work is being performed by a combination of mine personnel, consultants, government and First Nations. One of the tools that is proving very helpful in understanding the caribou migration patterns is the use of radio collars to provide radio telemetry tracking. The second area of focus is the use of only native plant species in revegetation of the site, and thus the exclusion of imported noxious weeds. A revegetation research program is underway, in cooperation with Laurentian University and is funded in part by NSERC research grants (Natural Science and Engineering Research Council). This research is identifying plants, ecological structure, propagation potential and revegetation techniques. Also the site environmental management system procedures for revegetation and slope stabilization prohibit the use of agricultural seeds, straw and the like to prevent weeds being introduced, and this is monitored by the environmental staff.
Another area of environmental research is the muskeg. This program is being undertaken by a consortium from the universities of Waterloo, Toronto and Queen’s. The program will evaluate the regional connectivity between the upper and lower aquifer systems through the clay and bioherm formations in the project area. The research will quantify changes to the peatland hydrology caused by dewatering of the Victor Mine pit. At the same time, the mercury mechanisms in the peatlands will be
investigated. This peatland and muskeg program is a five-year program started in August 2007 and due for completion in July 2012. Funding for this research is estimated at about $2,000,000 over the five year period, and this total includes use of site facilities, logistics and field support.
Peatland research is also being undertaken by Laurentian University, and this program is to develop practical, cost effective techniques for the reclamation of disturbed peatland. This is a three year program that commenced in July 2007 was extended, and now is due to be completed by the end of 2011.
Key biodiversity plans for Snap Lake include an Acquatic Effects Monitoring Program, a Wildlife Effects Monitoring Program, a Vegetation Management Plan, and an Air Quality Monitoring Plan. In 2010, the Aquatic Effects Monitoring Program was updated in consultation with regulatory agencies and discussions with community representatives.
Energy and climateWe are all aware of the growing interest in climate change, and in energy management.
Other conceptual studies included the possible use of wind generation. The use of waste heat from compressors underground at Snap Lake was studied and a program instituted. Waste heat from the Snap Lake generators is already re-used. Steps to manage and reduce emissions from mobile and static equipment are also under review.
One of the challenges we face is that as both our mines become older, mining takes place deeper. We therefore face increased energy consumption for transport of ore and waste rock, as well as increased pumping requirements for water control. Furthermore, underground mining requires more energy for ventilation. All of these contribute to growing demands for fuel and energy consumption. Energy management is therefore important.
Environmental monitoring includes a comprehensive fish study of the waterways surrounding the Victor Mine.
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Energy EfficiencyExploring energy efficiencies that have the potential to drive savings in fuel consumption is the mandate behind the Snap Lake Wind Power Research Project.
Two 60 metres high, self contained weather stations, installed within the boundaries of the Snap Lake Mine site, have been effectively collecting data pertaining to wind speed at site since September 2008. These two towers have effectively collected data pertaining to wind speed at site in support of a study to determine the viability of constructing a wind farm at the Snap Lake Mine. A scoping study to determine the feasibility of integrating wind power at Snap Lake was completed in December 2010, based on 15-months worth of data. The report showed that wind power integration at Snap Lake would have a small net impact on the net present costs. The wind power integration project would have no net cost if one of the following events occurred;• Short-term rise of diesel cost to $1.00/litre;• 10% reduction in thermal loads through energy efficiency;• 12% reduction in wind power capital costs;• Improvement of the heat recovery.
It was recommended that the collection of wind data should be extended to provide a 36-month data set that would be more reliable.
The potential is considered likely to be there, but has not been demonstrated to be viable at present.
The study identified other potential opportunities. One significant opportunity is that the thermal load at the mine is larger than the electrical load. Fresh Air Raises represent a significant portion of the thermal load and it is not currently linked to either of the heat recovery loops for the main diesel generators. This opportunity is being evaluated.
The buildings at Snap Lake are heated primarily using glycol warmed by waste heat. The mine endeavors to recover the maximum amount of waste heat from the diesel generators in order to reduce the load on the diesel-fired glycol heaters. This is done through the use of heat exchangers which remove the heat from the engine coolant, transferring it to the glycol. All four of our heat exchangers were increased in size. This increase in-turn improved the ability of the exchanger to recover heat by an estimated 30 per cent. It is expected that the additional heat recovery capability of the exchangers will reduce or eliminate the need to use the diesel fired boilers to support building heating needs most of the time, which could reduce our diesel fuel consumption by 800,000 to 1million
litres per year. Currently we do not have the mechanisms to track energy savings being realised at either mine, and we are looking at how best to address this.
2010 presented a number of challenges for the mining industry and the production at the Snap Lake Mine increased throughout the year following the slowdown at the end of 2008 and throughout 2009. This resulted an increase in energy and fuel consumption.
At Victor, a survey was completed of cooling issues at the mine site. The results of this are being evaluated and any opportunities will be identified and prioritized.
Throughout 2010, De Beers Canada and the Snap Lake Mine endeavoured to implement the Mining Associations Towards Sustainable Mining (TSM) protocols, which focused on Crisis Management, External Outreach, Tailings Management and of no less importance, Energy and Greenhouse Gas (GHG) Emissions Management.
The key focus areas pertaining to energy and GHG management specifically were those of improved data tracking and an increased awareness of energy use and GHG generation among the general site population at the mine The intent is that this knowledge will better enable Snap Lake to make the incremental changes needed to improve our management of GHG.
Furthermore, we continuously promote awareness around the consumption of fuel and the related emission of GHG. Through awareness we can reduce our consumption of fuel by (for example) reducing idle time on vehicles, and reducing the distances that equipment must haul rock and by parking.
We do not have any initiatives to provide energy-efficient or renewable energy based products and services as these are not applicable to diamond mining. There are therefore no reductions in energy requirements.
Control room operator monitors the process plant from the central control room at Snap Lake Mine.
De Beers Canada Inc. - 2010 Report to Society 73
Greenhouse gasesGreenhouse gas emissions were created by the on-site diesel generation, from the earthmoving and light vehicle fleet, and incineration. Energy use for Snap Lake in 2010 totalled 90,469,458 kWh. Total fuel energy used was 1,118.080 GJ, of which 998,828 GJ relate to power generation and heating. Within this total, mobile equipment emissions totalled 119,234 GJ, Using the World Resource Institute “Scope 1” parameters for direct greenhouse gas emissions, it is estimated that the CO2e for all activities at the Snap Lake Mine totalled 82,554 tonnes, all of which were direct emissions. NOx emissions are estimated at 3,162 tonnes CO2e which are included in the above total. There were no indirect emissions. The only use of ozone-depleting substances during 2010 was in kitchen coolers and fire extinguishers and no emissions took place.
Energy use for Victor totalled 96,195,109 kWh. This was all drawn from the national grid. In addition, emergency power was generated by on-site diesel generators when the grid power was temporarily unavailable for several hours. Total fuel energy used was 729,780 GJ, of which 58,566GJ relate to stationary fuel consumption for boilers, 8,477 GJ relate to stationary fuel combustion and 316,434 GJ relate to mobile equipment. Greenhouse gas emissions for this emergency power generation are captured through the figures for the consumption of diesel fuel. It is assumed that all of the grid power was generated by the Otter Rapids Hydro-Electric Generating Station operated by Ontario Power Generation from water.
Using the World Resource Institute “Scope 1” parameters for direct Greenhouse gas emissions, Greenhouse gas emissions were created by the on-site diesel generation, from the earthmoving and light vehicle fleet, and incineration and it is estimated that the CO2e for all activities at the Victor Mine totalled 49,003 tonnes, of which 27,840 tonnes were direct emissions and 21,163 tonnes were indirect emissions. NOx emissions are estimated at 275 tonnes of CO2e which are included in the direct emissions total above. The only use of ozone-depleting substances during 2010 was in kitchen coolers and fire extinguishers and no emissions took place.
Currently we do not track World Resource Institute “Scope 2” or “Scope 3” environmental impacts for transporting product, goods and materials outside the mine area boundaries defined within “Scope1”
Water managementWater used at both sites requires careful management. Water is essential to the health and wellbeing of all plants and animals including humans on this planet. It is thus very important to the company and to its stakeholders. Water management falls into several categories: (i) water produced by dewatering of the mine workings; (ii) disposal of water from mine dewatering, which may require pre-treatment prior to discharge to bring the outflow to an acceptable quality level; (iii) supply of potable water: (iv) disposal of ‘grey water’; (v) supply of water for the process plant (including recycling); (vi) disposal of process water (including recycling), and in the case of Victor (vii) supply of supplementary water to existing waterways to ensure that they are not adversely affected by the mine dewatering activities; (viii) water recovered from processed kimberlite and waste rock containment; and (ix) surface run-off.
Total water use for mining operations and exploration totalled 42,097,686m³ excluding the recycled water (1,019,358m³ [2.4%]). None of the water withdrawal significantly affected any water source.
Water consumption figures for 2008, and 2009 are restated because we discovered an inconsistency in the reporting for potable water. In some instances it was included in the totals twice. The way we track and record data for water has been modified to prevent this error recurring. Please note that there were problems with water flow meters at Victor in 2009 that has resulted in an under-recording of the water use at Victor during 2009.
Staff from environmental consultant Golder Associates collect a water sample from Snap Lake through the ice.
De Beers Canada Inc. - 2010 Report to Society 74
Table 7-6: Water use at Snap Lake Mine for the period 2008 to 2010
Use 2008 (m3) 2009** (m3) 2010 (m3) How Measured Source
Mine dewatering 4,603,497 6,220,097 7,408,035 Direct reading Mine. Water is sent to the Water Treatment Plant (WTP) for treatment.
Potable water (treated) 0 0 0 N/A All potable water is derived from treated non-potable water.
Non-potable water 424,143 352,550 344,563 Direct reading Seepage from sumps at the North Pile, pits, sumps at the ammonium nitrate storage, airport, fuel berms and similar sites pumped to the WTP for treatment and discharge
Recycled water 429,872 163,048 296,056 Direct reading Recycled water is pumped from the WTP to the process plant.
Total* 5,027,640 6,572,647 7,752,598
Snap Lake Mine Water ManagementThe water management system at Snap Lake is designed to collect, transport, treat and discharge both surface and underground water. Mine water is pumped from multiple collection sumps underground, through pipelines which bring the water to surface into the Water Treatment Plant. There, water is treated to meet required standards before release to Snap Lake. Some of the mine water arriving in the Water Treatment Plant is recycled for use in the Main Process Plant, or is used for surface dust control and concrete production. Water is also used to transport fine processed kimberlite to the North Pile (deposition cell on surface). All water from the deposition cell and all surface runoff is collected and transported to a Water Management Pond. Water in the Water Management Pond is pumped to the Water Treatment Plant before being released to Snap Lake. Fresh water is withdrawn from Snap Lake
at a pump-house for potable water use in the camp/accommodations. The water is treated to meet health guidelines for human consumption. Sewage and ‘gray water’ from the camp is treated in one of the Sewage Treatment Plants on-site to meet the required standards. It is then transported to the Water Treatment Plant for further treatment and then is released to Snap Lake. Regular sampling of water occurs at points within the water management system and at adjacent watercourses throughout the year. De Beers is currently in compliance with regulated limits. The receiving body, Snap Lake itself, is about 200 hectares in area. Because of the size of the lake and the relatively low flow of water through this body, this lake has a limited absorption capacity.
Destinations for wastes are shown in Tables 7-9 and 7-10.
* Excludes recycled water.** Snap Lake operated only a single shift for much of 2009.
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Victor Mine Water ManagementThe Victor Mine is an open pit operation and a well field around the pit dewaters the pit area. That water is then discharged into the Attawapiskat River at the volume and rate outlined in the environmental permit. Studies for the Environmental Assessment indicated that the water being discharged into the river mixes and dilutes within 150 metres of the discharge point.
Water used in our processing plant in 2010 was discharged to the first cell of the processed kimberlite containment facility and then discharged to the Central Quarry. This containment facility consists of a series of storage cells, each surrounded by a compact coarse processed kimberlite retaining wall or berm. Water from these cells is directed to the old Central Quarry on the mine site and is then recycled. The overflow from the containment cells and the Central Quarry drains through the muskeg which traps any remaining fine solids prior to discharge into adjacent creeks during non-frozen periods of the year. During winter, excess water is discharged to the Attawapiskat River in accordance with environmental permits. Regular sampling of adjacent water courses throughout the year has not shown any unpredicted anomalies and total suspended solids and effluent quality has been as anticipated. The receiving body is the Attawapiskat River. At the point of discharge into the river, the catchment area is about 49,000 square kilometres, and the average flow is in excess of 49 million cubic metres per day. The volumes discharged are therefore very small in comparison.
At Victor Mine, the Attawapiskat River had a pre-existing, naturally high level of mercury prior to the construction and operation of the mine. NGOs and community members continued to raise concerns about the
potential for mercury from dewatering muskeg (from methyl mercury) polluting the potable water supply and the food chain through disposal into the Attawapiskat River system. This issue was considered extensively during the mine’s federal Comprehensive Study Level Environmental Assessment and was found not to be a significant impact. Nevertheless, further studies continue to be undertaken in conjunction with experts from AMEC Earth & Environmental, the University of Waterloo, Queen’s University, and the University of Toronto to obtain additional data for additional assurance. Early results continue to support the Environmental Assessment findings, however the full results for this study will not be available until 2013 at the conclusion of this five-year program. Professors Dr. Jonathan Price (Waterloo), Dr. Vicki Remenda (Queen’s) and Dr. Brian Branfireun (Toronto) are recognized experts in their respective fields and are leading this program. Stronger concerns were raised about peat decomposition in ‘dewatered areas’ and the potential for the release of increased amounts of methyl mercury. In response to these concerns, and based on updated hydrogeological modeling, predictions of expected rates of increased total and methyl mercury were developed by our environmental consultants (AMEC Earth & Environmental) and submitted as part of the permit application packages for the Ontario Ministry of the Environment for well field dewatering. The most recent predications (2010) still indicate only very slight increases in mercury release that would be difficult to detect within the context of natural background variation. The mercury concentration levels in the receiving waters are expected to continue to be well within federal and provincial water quality guidelines for the protection of aquatic life, consistent with the Comprehensive Study Report predictions.
Table 7-7: Water use at Victor Mine for the period 2008 to 2010
Use 2008 (m3) 2009** (m3) 2010 (m3) How Measured Source
Mine dewatering 22,081,721 25,671,197 27,780,956 Direct reading Mine: Discharged to Attawapiskat River.
Potable water (treated) 0 0 0 N/A All potable water is derived from treated non-potable water.
Non-potable water 3,779,670 968,757 6,417,174 Direct reading • Process plant supply is from the Attawapiskat River;• Mine dewatering from perimeter well network;• Surface water is diffuse seepage from muskeg, surface
runoff and precipitation;• Creek flow supplementation is from Attawapiskat River;• Ice road water is taken from mine dewatering wells,
Attawapiskat River, Nayshkootayaow River, and various small un-named creeks.
Recycled water 0 1,740,540 723,302 Direct reading All recycling is in the process plant.
Total* 25,861,391 26,639,954 34,198,130
* Excludes recycled water.** Figures for 2009 are significantly under-reported because of issues with flow meters for the several months.
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Table 7-8: Materials consumed by division (Gahcho Kué Project was on care and maintenance)
MaterialSnap Lake
Victor Exploration Total
Aircraft fuel (litres) 7,658 63,140 35,499 106,297
Diesel (litres) 33,219,439 9,836,626 147,713 43,203,778
Electricity purchased (kiloWatt hours) 0 96,195,109 211,818 96,406,927
Heavy fuel oil (litres) 0 0 0 0
Intermediate fuel oil (litres) 0 0 21 21
LPG & liquid fossil-fuel gases (tonnes) 1.9 0.8 0 2.7
Natural gas & fossil-fuel gases (cubic metres) 0 0 24.600 24,600
Unleaded gasoline (petrol) (litres) 1,445 14,776 15,522 31,743
Treated potable water (cubic metres) 59,425 43,609 3,298 106,332
Natural potable water (cubic metres) 0 0 0 0
Non-potable water excluding re-used / recycled water (cubic metres)
7,364,551 17,794,294 4,196,284 29,355,129
Re-used / recycled water (cubic metres) 296,056 723,302.06 11,716 1,031,074
Ferrosilicon - FeSi (tonnes) 1,010 750 0.5 1,760.5
Grease (kilograms) 33,946 9,453 10 43,409
Hydrochloric acid (litres) 0 0 0 0
Oils & hydraulic fluid (litres) 144,302 134,600 9 278,911
Sulphuric acid (litres) 21,234 5 0 21,239
Nitric acid (litres) 0 0 0 0
Sodium hydroxide (litres) 0 7 0 7
Reused oil/grease (litres) 40,000 0 0 40,000
Cans sent for recycling (tonnes) 0.2 0 0.6 0.8
Cardboard/paper sent for recycling (tonnes) 0 0 0.2 0.2
Contaminated water (litres) 200 0 0 200
Drums sent for recycling/reuse (number) 0 369 0 369
Earthmoving tires sent for recycling (number) 33 0 0 33
Electrical and electronic items sent for recycling/reuse (kilograms)
0 0 0 0
Glass sent for recycling (tonnes) 0 0 0.1 0.1
Lead acid batteries sent for recycling/reuse (number) 0 250 0 250
Light vehicle tires sent for recycling (number) 111 0 0 111
Liquid hazardous waste (litres) 24,835 98,000 0 122,835
Non-hazardous waste to land-fill (cubic metres) 1,050 1,764 14 2,828
Plastic sent for recycling/reuse (tonnes) 0 0 0 0
Scrap metal sent for recycling (tonnes) 0 0 0 0
Solid hazardous waste (cubic metres) 66.0 284.4 0 350.4
Toner\Ink sent for recycling\reuse (number) 40 0 50 90
Used oil/grease sent for recycling/reuse (litres) 4,000,568 0 0 4,000,568
Waste incinerated (cubic metres) 625 178 0 803
Oxygen gas: O. Sz 44 6.9 m³/cylinder (cubic metres) 1690.5 2249.4 0 3,939.9
Oxygen gas: O. Sz 22 3.45 m³/cylinder (cubic metres) 0 44.85 0 44.85
Acetylene gas C2H2.Sz 8, 23 & 69 (cubic metres) 896.1 926.9 0 1,823.0
Argon gas: Ar, Blueshield 8 Sz 44 9.32 m³/cylinder (cubic metres)
913.36 1,239.56 0 2,152.92
Nitrogen gas: N. Sz 50 8.46 m³/cylinder (cubic metres) 219.96 25.38 0 245.34
Solvent: Varsol 3139, Drum-205 litre (litres) 615 0 0 615
Cleaner; Cleansolv HF EP, for Gear Degreaser (litres) 615 0 0 615
Degreaser: Emulsifying, Liq. Clr, Aer/32oz. (kilograms) 18.14 0 0 18.14
Materials and WasteVirtually none of the materials consumed are recycled or reconditioned materials, reflecting difficulties relating to the remoteness of the site and the seasonal access. Currently a detailed life-cycle assessment is not undertaken. We regularly review processes to improve the recyclability, material reuse, energy use and reduction of material and energy use on a regular basis, together with a review of the environmental impacts. We support scientific research into rehabilitation, specifically for revegetation. Our materials stewardship is still in its early stages of development.
The largest waste stream is waste rock. Opportunities to reduce this appreciably are relatively small, and there are no realistic uses for these wastes as both mines are remote with only seasonal access and transport costs would be prohibitive. Nevertheless, continual improvement in efficiencies and sustainability remains a goal. The opportunity to use waste rock is examined periodically, but the distance to the nearest community (approximately 100 km) would require a round trip of 200 kms and the short duration of the winter road season make this an unattractive opportunity. Nevertheless the economics for this are being considered by entrepreneurs in the communities from time to time.
During the Environmental Assessment, the nature of all overburden, rock, processed materials, mineral waste (processed kimberlite and waste rock) or residues was characterised, and the risks associated with these was assessed. Mitigative measures were put in place as part of each mine’s environmental management system to manage these materials in a responsible manner and to minimize any residual risks associated with them. Ongoing monitoring of the materials during operations confirms whether or not actual operational results are as predicted. Adaptive management is used, in conjunction with consultation with affected communities and regulatory bodies, to adjust mitigable measures as required.
De Beers Canada Inc. - 2010 Report to Society 77
WasteMaterials consumtion is summarized in Table 7-8.
Hazardous wastes include hydrocarbon-contaminated materials, used dry cell and lead acid batteries, paints and varnishes, used oils and lubricants, used aerosol containers, fluorescent and compact light bulbs and tubes, and, cleaning chemicals used in the accommodation complex and workshops,
Storage of waste rock and processed kimberliteStorage facilities for processed kimberlite and waste rocks are designed in accordance to the Canadian Dam Association and the Mining Association of Canada recommendations. All storage facilities are subject to at least an annual inspection by a suitably qualified certified external geotechnical engineer, and slopes for retaining walls are monitored continuously. During 2010, the first containment cell for processed kimberlite was completed at Victor (and the construction of the second lift for this cell commenced).
The potential for metal leaching was assessed during the Environmental Assessment for each mine. To date, results from this monitoring have been within the predicted range. Where such potential is present, periodic monitoring is undertaken to monitor actual conditions and compare these to predictions. Runoff water from stockpiles, the waste rock and processed kimberlite containment areas is periodically tested and monitored for potential contaminants of concern. Results are reported to the regulatory bodies, and are included in an annual Environmental Report. Adaptive management will be used to adjust mitigation plans for any unpredicted adverse effects where necessary. Risks are higher at Snap Lake than Victor due to the carbonate rocks at the latter providing a natural neutralizing buffering.
The hazardous potential and properties of any of the overburden, rock, tailings or sludges/residues were characterized during the Environmental Assessment prior to each mine being developed. Periodic monitoring during development and operations compares the actual properties with the predicted ones. These results are submitted to the regulatory authorities and are included in an annual Environmental Report. To date, no unpredicted hazardous properties have been recognized. If any unpredicted hazardous materials were observed, adaptive management would be used to design and implement appropriate mitigable steps. No hazardous materials were transported outside Canada.
At the Snap Lake Mine, there is limited potential for acid drainage from rock stockpiles that contain metavolcanic rocks, and a much smaller chance for some of the granite stockpiles. The potential for hazards from these is low. Impoundment of mineral waste (processed kimberlite and waste rock) has a low hazard potential. It is not acid-generating and the impoundment areas are remote from the mine portal and from the camp so there is little hazard to these if there were to be a breach of the containment. The North Pile processed kimberlite containment area is close to Snap Lake itself and there is a potential for a sudden influx of sediment to Snap Lake itself. The containment structures are regularly inspected for defects, and the probability of a breach is low.
At the Victor Mine, there is minimal potential for acid drainage because the country rocks are carbonates. The mineral waste (processed kimberlite and waste rock) for the first 18 months of production was used to fill a quarry used for construction, and the potential for a hazardous breach is negligible. The impoundment areas for mineral waste (processed kimberlite and waste rock) are well away from major waterways and from the mine pit.
Table 7-9: Destinations for materials, waste and water use at Snap Lake Mine during 2010
Waste Destination
Non-potable water Discharge to Snap Lake
Lead acid batteries Battery recycler
Non-hazardous waste to landfill Landfill at site
Solid hazardous waste Hazardous waste disposal facility off-site
Waste incinerated Incinerated
Table 7-10: Destinations for materials, waste and water use at Victor Mine during 2010
Waste Destination
Non-potable water Discharge to Attawapiskat River
Lead acid batteries Battery recycler
Non-hazardous waste to landfill Landfill at site
Solid hazardous waste Hazardous waste disposal facility off-site
Waste incinerated Incinerated
Processed kimberlite is stored at the extremities of Victor Mine.
De Beers Canada Inc. - 2010 Report to Society 78
Table 7-11: Hazard potential at Snap Lake Mine for 2010
Material Volume (m3) Hazard potential Remarks
Overburden 88,500
Rock – country 1,890,673 Acid rock discharge Low: limited to metavolcanic waste rock
Low-grade ore
Tailings 715,594
Sludge 603,359
Rehabilitation - Snap Lake MineLands owned, leased or managed for the Snap Lake Mine totalled 550 hectares. None of this total lies within a biodiversity-rich habitat. Table 7-12 shows any changes made to the total amount of land owned, leased or managed for production activities or extractive use.
Most of the land leased at Snap Lake is impermeable: the bedrock consists of gneisses, metavolcanics and granites which have very low permeabilities. These rock units are overlain by a sequence of glacial tills, and sands with variable permeabilities.
There were no significant environmental impacts caused by the principle product, diamond, or by services related to the mine. Diamond is an inert and non-toxic form of carbon. Diamonds have many uses. The waste from diamond cutting and polishing is normally re-used in the drilling, cutting or polishing industries. Diamonds that are cut as gem stones are occasionally re-cut with the waste being re-used as above. Most gem and near-gem quality diamonds are used in jewellery and are reclaimable. Industrial quality diamonds are usually consumed during the industrial processes that use them. These processes make use of the physical properties of diamond (e.g. hardness, electrical and optical properties). There are no percentage figures available for the product that is reclaimable or reclaimed at the end its life.
Table 7-12:
Hectares
Total land disturbed and not yet rehabilitated (opening balance) 188.4
Total amount of land newly disturbed within the reporting period 33.1
Total amount of land newly rehabilitated within the reporting period to the agreed upon end use
0
Total amount of land disturbed and not yet rehabilitated (closing balance) 188.4
De Beers Canada Inc. - 2010 Report to Society 79
Rehabilitation - Victor MineThere was no change in the lands owned, leased or managed for the Victor Mine and these totalled 6,686 hectares, all of which lie within the James Bay Lowlands. These Lowlands are extensive areas of muskeg (peat lands) which were pristine prior to exploration and development. None of this total lies within a biodiversity-rich habitat. Table 7-14 shows any changes made to the total amount of land owned, leased or managed for production activities or extractive use. This total includes the freight handling yard in Moosonee.
None of the land leased at Victor is impermeable: the bedrock consists of dolomitic limestone and carbonates which have significant permeability. These rock units are overlain by a sequence of glacial clays, tills, sands and gravels with a low permeability overall. This glacial sediment package is overlain by a zone of waterlogged muskeg (peat) which is permeable.
There were no significant environmental impacts caused by the principle product, diamond, or by services related to the mine. Diamond is an inert and non-toxic form of carbon. While diamond has many uses, the waste from diamond cutting and polishing is re-used in the drilling, cutting or polishing industries. Diamonds that are cut as gem stones are occasionally re-cut with the waste being re-used in the drilling, cutting or polishing industries. Most gem and near-gem quality diamonds are used in jewellery and are reclaimable. Industrial quality diamonds are usually consumed during the industrial processes that use them. These processes make use of the physical properties of diamond (e.g. hardness, electrical and optical properties). There are no percentage figures by weight available for the product that is reclaimable or reclaimed at the end its life.
A summary report under the Follow Up Program Agreement for Victor was produced in mid-2010 as required and compared predicted results with actual results for the 2006-2007 construction period, for 2008 and 2009, the first two years of operations. Observed impacts were all within the range predicted by the environmental assessment. Future reports will cover each calendar year. The Follow-Up Program Agreement report for 2010 is currently in preparation and should be issued before the end of June 2011.
Table 7-13: Hazard potential at Victor Mine for 2010
Material Volume (m3) Hazard potential Remarks
Overburden 2,670,000 Excludes peat
Overburden - Peat 600,000 Fire
Rock – country 750,000
Low-grade ore 1,165,000
Tailings 400,000 m3 Excludes volume in Central Quarry: volume for latter not available. Includes fine and coarse processed kimberlite used to construct dykes and berms. Excludes small volume used for current dyke construction.
Sludge N/A Sewage sludge is incinerated
Table 7-14:
Hectares
Total land disturbed and not yet rehabilitated (opening balance) 732.3
Total amount of land newly disturbed within the reporting period 136.0
Total amount of land newly rehabilitated within the reporting period to the agreed upon end use
0
Total amount of land disturbed and not yet rehabilitated (closing balance) 868.3
De Beers Canada Inc. - 2010 Report to Society 80
Mine Closure Both our mines in Canada and our one advanced project have closure plans.
Snap Lake MineA closure plan was prepared and approved by the regulators prior to the commencement of operations. The plan aims to establish stable landforms, protect the water resources in the local area; facilitate natural recovery of areas affected by mining and the mining related activities at the project site; and, re-establish productive use of the land and water in the vicinity of the mine site consistent with the pre-development use of the land and water.
The cost for closure at Snap Lake is estimated at the end of 2010 as $55,400,000 and includes the cost for final mine reclamation and post-closure monitoring and maintenance. Financial security is in place with the Federal government to cover these costs. The closure plan and financial assurance are reviewed periodically by the regulators, and updated to ensure the plan and security coverage are appropriate.
Victor MineEstimates for closure under both scenarios were reviewed and revised during 2010. Two closure plan scenarios have been considered for Victor. The first of these is a premature cessation of operations entailing removal of all infrastructure, land rehabilitation, pollution remediation, post-closure monitoring and aftercare, and also includes a contingency. A cost for closure under a premature cessation of activities was estimated at $34,488,000 in 2010 dollars. The second case is a closure cost for the end of operations (currently forecast as in 2019). This forecast also covers removal of all infrastructure, land rehabilitation, pollution remediation, post-closure monitoring and aftercare, and also includes a contingency. A cost for closure at the end of the life of the mine was estimated at Cdn$47,294,000 in 2010 dollars. Financial assurance for the full cost of mine closure at the end of operations has been provided to the Ontario government as required by legislation. Preliminary discussions on labour transition from operations to the post-closure state commenced in 2010 with the affected communities, and will continue in 2011 for inclusion in periodic closure plan updates as these transition plans are agreed, probably from 2012 onwards.
Gahcho Kué ProjectOne closure plan is in place for Gahcho Kué, and the cost is estimated at $16,500,000 to remediate and close the current site and infrastructure. Predictions for closure costs in the feasibility study are estimated at $36,500,000.
Environmental legal compliance At the Victor Mine, there is an ongoing issue with non-compliance of the waste incinerator with the provincial point-of-emission (in-stack) standards, due to a carryover of particulates in fine droplets or mist from the wet scrubber. Most of these are sodium and potassium salts formed within the incinerator itself. This is a very small source so point-of-impingement standards are not at risk. While there is a potential for enforcement action, we are operating under a voluntary compliance program, and we are working with the incinerator manufacturer to find a solution.
One local contractor involved in winter road construction exceeded the allowable water take from an unlicensed creek for 11 days in January-February 2010, and did not provide records in a timely manner to the mine site so detection and reporting to the regulatory agency was delayed. The regulator has investigated on site and felt De Beers due diligence was acceptable. No charges are anticipated.
Well seals failed on two remote groundwater monitoring wells allowing saline artesian water to flow to the surface. There was some limited vegetation damage and a legal non-compliance for leaving artesian wells unsealed. The seals have been replaced. No legal consequences are anticipated.
There were four legal non-compliance incidents at Snap Lake. There were two moderate spills, a discharge of non-compliant water to Snap Lake where the total suspended solids were above the permitted level, and a deficiency in the operational review of planning for closure. This incident is currently still being investigated by INAC.
No fines were incurred or paid for any environmental infraction during 2010.
Environmental Incidents, Accidents and Near HitsThere were no major environmental incidents or accidents at either the Snap Lake or Victor Mines during 2010. There were 284 minor incidents and three moderate incidents, all of which were reportable under environmental legislation. In each instance, spills were cleaned up effectively and completely, and there was one unauthorized discharge of contaminants into to a water body at Snap Lake.
De Beers Canada Inc. - 2010 Report to Society 81
Management ApproachContractors, Suppliers and ProcurementOur approach is to coordinate procurement for both our Canadian mines to obtain economies of scale where practical while maintaining quality and reducing cost considerations where we can. We are moving to standardize on equipment where practical so that material is interchangeable between operations. Within these boundaries, we endeavour to encourage businesses within the local communities to work to supply us with goods and services so that they can maximize opportunities, and develop new businesses that may be sustainable after our mines close. In this context, local communities means the eight communities with whom we have impact benefit agreements.
The role of the manager for supply chain and asset management is to provide a leadership role in asset management, including maintenance philosophy, continuous improvement programs and the management of supply chain activities such as warehouse and purchasing/procurement of strategic commodities and/or services for De Beers Canada to manage risk, ensure maximum savings and identify and deliver value-added opportunities.
De Beers Canada starts its activities with exploration and there is no upstream impact as this is the beginning of the diamond supply chain. Downstream impacts relate to the marketing of the rough diamonds produced from its mines, and the impacts of its exploration and mining activities. We need to develop a Canada-wide procurement system that makes the best use of our resources, and maximizes the purchasing
power of the company by standardization where practical between our various operations.
ContractorsEach De Beers Canada vendor signs a contract outlining the requirements to comply with the Law and Policies of De Beers Canada. This includes but is not limited to the vendor making themselves aware of the United Nations Universal Declaration of Human Rights; International Labour Organization Conventions; Minimum Age Convention, 1973 (No. 138); the Worst Form of Child Labour Convention, 1999 (No. 182) and the Forced Labour Convention, 1930 (no.29). In addition, the vendor covenants in respect of all Child Labour, between the ages of 16 and 18 that it will comply with all other requirements under the Conventions. Further, the vendor certifies that the workers it uses, and will use to produce product, provide services or manufacture or supply material are present voluntarily and that they do not nor will not knowingly use forced labour.
ProcurementProcurement through the use of local suppliers for goods and services is one of the commitments that we have in our IBAs. We work diligently to ensure that opportunities are provided to our Communities of Interest, and we regularly review future opportunities to see how these could be presented in a way that will enable communities to participate and tender for them. Our procurement practices are guided by a Northwest Territories Business Policy, and by a preferred purchasing from local suppliers where practical elsewhere.
Contractors, suppliersand procurement
Table 8-1: 2010 human resource goals and objectives
Goal Degree achieved Successes Shortcomings Additional remarks
Appoint a manager for asset management and the supply chain.
Appointment made. New manager is in place and working on updating and implementing appropriate policies and procedures.
There is much work to be done in this area.
Align and improve asset management and procurement Canada-wide for DBCI.
Progress has been made.
Much still remains to be done.
De Beers Canada Inc. - 2010 Report to Society 82
At Snap Lake, a total of $119,106,000 was spent on operations’ contracts during 2010; $104,194,930 (87 per cent) of these goods and services were supplied by “northern businesses”, and $48,062,961 or 46 per cent of this total has been provided by Aboriginal suppliers during the three years of construction. For definitions of northern and Aboriginal, please see the glossary.
At Victor, during 2010 a total of $157,317,000 was spent on goods and services: $49,070,000 or 31 per cent of this total for the goods and services was supplied by Aboriginal businesses.
All suppliers of goods and services are expected to comply with the basic conditions of the Best Practice Principles (BPP). The Best Practice Principles program provides confidence and assurance that the participants are acting and operating in a responsible manner, and are adhering to good practices with regards to ethics, business conduct, legal requirements, human rights, safety, health and environment and general security. Those individual businesses that provide a significant percentage (>10%) of the goods and services are required to provide a written statement that they are adhering to Best Practice Principles,
At Snap Lake, four vendors supplied goods or services totalling more than 10 per cent of the total expenditure to De Beers Canada. These were Imperial Oil with sales of $17,500,000; Sandvik Mining and Construction with sales of $16,685,600; Tli Cho Logistics with sales of $15,833,900; and Ek’ati Services Ltd. with sales of $12,7167,000. At Victor, none of the vendors supplied goods and services totalling 10 per cent or more of the total expenditure. In Exploration, four vendors supplied goods or services totalling more than 10 per cent of the total expenditure. These were Les Forages LBM with sales of $2,305,000; Foraco Canada Ltd with sales of $2,075,000, Fugro Airborne Survey Corporation with sales of $1,6789,000, and De Beers Group Services for administration and laboratory services with sales of $1,553,000. At the Corporate offices, there were two vendors who supplied goods and services totalling more than 10 per cent of the total spend. They were Marsh Canada Ltd with sales of $3,589,000; and De Beers Group Services with sales of $1,986,000.
The BPP program helps to provide assurance and confidence to customers of the Diamond Trading Company that the diamonds marketed by the Diamond Trading Company have been produced in an ethically, environmentally and socially responsible manner. De Beers Canada provides very limited services to related companies and these services have to be provided within the framework and expectations of the Best Practice Principles assurance program.
Employees on the floor of the main warehouse at Snap Lake Mine.
De Beers Canada Inc. - 2010 Report to Society 83
Management Approach - Product responsibilityFrom a Diamond Liaison and product responsibility perspective, we ensure De Beers Canada’s product, rough diamonds, are valued appropriately to sell to the Diamond Trading Company (DTC) in order to realize the maximum value for the diamonds and De Beers Canada.
Our approach is to ensure the cleaning, sizing, breakage analysis, royalty valuation and export processes of the rough diamonds are conducted safely, effectively and professionally. All data relating to these tasks is reported and stored on appropriate systems. No shortcomings were noted in 2010.
De Beers Canada has a single customer, the DTC, which is a related company. No product information or labelling is required as the raw materials produced (i.e. rough diamonds) are considered non-hazardous, non-toxic and inert. There are no initiatives to mitigate environmental impacts of the product because these are not required and no services are provided. During the exploration, development and operations phases, our activities are governed by environmental, health and safety management systems that are registered to ISO14001 and compliant with OHSAS 18001. This helps us to provide some assurance that diamonds are explored for and recovered in a responsible manner. All the product sold to the DTC is sold to sightholders and all the packaging materials are recycled in accordance with the DTC recycling program. There were no infringements of environmental laws or non-compliance related to products or services and no fines.
De Beers Canada has one single major customer that purchases all of its production from each mine. Up to 10 per cent of the production, by value, from each mine is then sold by this purchaser to government-approved sightholders in the NWT (Snap Lake Mine) and Ontario (Victor
Mine). A similar agreement is also in place with the Government of the Northwest Territories and will become effective if and when the Gahcho Kué Project begins production.
De Beers Canada’s customer is a related company. It is the practice not to disclose any information about customers without their prior consent, unless instructed to do so by a court of law. There were no complaints related to breaches of customer privacy or losses of customer data, nor were there any fines for non-compliance with laws and regulations concerning the provision and use of our product or services.
Product responsibility
Table 9-1: 2010 product and responsibility goals and objectives
Goal Degree achieved Successes Shortcomings Additional remarks
Monitor uses and properties of diamonds to detect any negative emerging issues related to the physical properties of diamonds.
Work on this is carried out by the various laboratories and research facilities of the De Beers Family of Companies around the world.
No adverse properties were noted in 2010.
No shortcomings were noted in 2010.
De Beers Canada Inc. - 2010 Report to Society 84
During the year, no instances occurred of non-compliance with regulations concerning customer health and safety in relation to our product, and no penalties or fines were levied for any such breaches. No complaints were upheld by any of the regulatory or similar bodies that oversee health and safety of product and services. Both the Snap Lake and Victor Mines and the Exploration division are certified to the ISO14001:2004 standard. Similarly, there were no legal actions for anti-competitive behaviour, antitrust or monopoly practices against De Beers Canada in 2010.
There have been no instances of non-compliance with regulations concerning product information or labelling during the year and thus no fines or penalties were assessed. All diamonds produced were exported in accordance with the Kimberley Certification process and World Diamond Council system of warranties and in compliance with applicable legislation.
De Beers Canada has a single major customer. No complaints were received from this customer, and there was regular and frequent dialogue to ensure that the customer was satisfied.
De Beers Canada does not have policies regarding anti-competitive behaviour and is not in a position to exert undue influence in any commercial setting in this regard because it has a single customer, which is a related company, for its product.
De Beers Canada does not engage in advertising or marketing activities for the retail or consumer markets. Thus, there were no breaches of advertising or marketing regulations during 2010.
Product lifecycle management is controlled by the end user of the product.
2010 CEO Safety, Health and Environment Award2010 was the second year for the De Beers Canada CEO Safety Health and Environment Award program. Three awards are made in recognition of an individual, or group of individuals who have achieved outstanding contributions or performance in the area of Safety, Health or Environment within any of the De Beers Canada mines, projects, exploration, or offices.
This initiative is aimed at: • Building SHE awareness among employees, • Building a friendly competition within the organization, • Recognizing those who go above and beyond the call of SHE duties, and • Recognizing SHE excellence in our employees.
There were 13 nominations company-wide in 2009, with our three winners being:
Dwayne Thompson, Manager Sudbury Treatment Plant for consistently demonstrating his dedication, passion and leadership of SHE. He does this through a caring attitude, personally reinforcing safety as the top priority and ensuring his staff have the training and knowledge required to work safely and protect the environment. Dwayne also achieved a high level of performance as confirmed by internal and external audit results.
Kevin Oberkirsch, John Rafasz and Mike Penkala, Snap Lake Mine Underground Mine Trainers implemented the “Why We Work Safely” campaign. This campaign used the site-based TV network to display pictures of family and loved ones waiting for employees to return home to reinforce the importance of working safely. The initiative was very successful and involved encouraging employees to bring in photos and working with IT to display the photos on the TV network.
Don Larivee, Victor Mine Electrical Supervisor and Rick Doiron, Victor Mine Instrument Technician jointly won the award in 2010 recognizing a significant potential eye injury hazard involved in realigning laser in a piece of recovery equipment. Existing practices required the technician to look at the laser during alignment while wearing protective glasses. During a realignment Rick inadvertently forgot to switch glasses and put on the laser protective glasses on and reported it as a near miss incident. Don and Rick worked together to share this information with their counterparts at Snap Lake and the technical team at Deb Tech in South Africa. They also worked on developing an innovative solution involving the use of video cameras for aligning the laser eliminating the need for the technician to look directly at the laser. Much of the initial background work on finding a solution was completed by Rick and Don while they were off-rotation. The camera solution will be incorporated by Deb Tech at mines across the Family of Companies. The nominees demonstrated leadership, individual initiative and a caring attitude which will benefit their counterparts across the Family of Companies.
exempli gratia
De Beers Canada Inc. - 2010 Report to Society 85
All the exploration programs and the mining operations are registered to the ISO14001:2004 Environmental Standard. The exploration programs are also compliant with the OHSAS 18001 Occupational Health and Safety standard through an integrated SHE (Safety, Health and Environment) Management system. Unfortunately, we were unable to complete the process for registration to OHSAS18001 during 2010. Both Snap Lake and Victor Mines are working to be compliant and achieve certification with OHSAS 18001 in 2011, and both mines are currently working in accordance with the requirements of OHSAS 18001.
Status of certification
Table 10-1: 2010 product and responsibility goals and objectives
Goal Degree achieved Successes Shortcomings Additional remarks
Complete registration to OHSAS18001 by the end of 2010.
Gap analyses were completed by year-end. Corrective actions to address gaps were well advanced.
Registration was not completed by the end of 2010, mainly due to a lack of resources..
Revised schedule is for Exploration and for Victor to be registered by end of Q2 2011, and Snap Lake by the end of Q3 2011.
Summer time in the exploration camp at Gahcho Kué Project.
De Beers Canada Inc. - 2010 Report to Society 86
Management Approach - AssuranceAssurance for De Beers Canada is provided by internal audit as well as by external assurance providers that take the form of numerous verifications, reviews and audits throughout the year. Included in this is the verification under the Mining Association of Canada’s Towards Sustainable Mining initiative. De Beers self-declared under this initiative in the latter part of 2010 and both mines will however undergo an external verification assessment in 2011. In addition, there are separate assurance programs to ensure that the requirements are met for the Kimberley Process Certification Scheme and the World Diamond Council System of Warranties.
Towards Sustainable Mining Initiative“Towards Sustainable Mining (TSM) is an initiative developed by the Mining Association of Canada (MAC) to improve the industry’s performance by aligning its actions with the priorities and values of Canadians. TSM provides a way of finding common ground with communities of interest in order to build a better mining industry, today and in the future. TSM is based on a set of guiding principles that in turn are supported by performance elements and indicators.”
TSM currently covers four key performance elements, namely Mine Closure, Energy and Greenhouse Gases, Tailings Management and External and Aboriginal Outreach. These four performance elements in turn contain 18 specific indicators. One of these performance elements, Crisis Management has “Yes/No” answers for its three specific indicators, while all the other three remaining performance elements have a number of specific indicators The criteria follow a five-level performance rating scale from level 1 (low) to level 5 (high). All of these specific indicators have to be in place and functioning to satisfy the requirements of a specific indicator rating level. If they are not, then criteria for a specific indictor rating level are not eligible to be considered as part of a score, and the score drops to the next level for which all the specific indicators are complete.
Additional performance elements are in preparation by MAC for biodiversity, safety and health, and mine closure.
Assurance
Table 11-1: 2010 assurance goals and objectives
Goal Degree achieved Successes Shortcomings Additional remarks
Achieve a Level 3 across the board for TSM by end 2010.
Partially met.See Table 11--2.
See Table 11-2. Energy and greenhouse gas section requires a lot of work. Some work to be done on other criteria.
Some additional work required to get Crisis Management and Tailings Management to an acceptable level 3. Longer term goal is to raise performance in all areas higher.
The transfer tower at Victor Mine feed coarse kimberlite into the process plant.Employees pass throught security at site.
See the full TSM guidelines at:www.mining.ca
De Beers Canada Inc. - 2010 Report to Society 87
Table 11-2: 2010 TSM ranking summary
Corporate Snap Lake Mine Victor Mine
Self1 BSi2 Self BSi Self BSi
Crisis ManagementPreparedness – Crisis Management plan in placeReview – Updated, Appropriate to risks and best practicesTraining – Annual training, including simulation
YYY
YYY
NNN
NNY
YYY
YYY
Energy and Greenhouse GasesEnergy use management systemsEnergy use reporting systemsEnergy intensity performance targetsGHG emissions management systemGHG emissions reporting systemsGHG intensity performance target
33
22222
23
21221
23
21221
23
21221
Tailings ManagementTailings Management Policy and CommitmentTailings Management SystemAssigned Accountability and ResponsibilityAnnual Tailings Management ReviewOperations Management System Manual
33332
33332
33323
33333
External OutreachCommunities of Interest (COI) IdentificationEffective COI Engagement and DialogueCOI Response MechanismReporting
4554
4354
3334
3334
Notes:
1 De Beers Canada ranking itself.
2 Verification assessment carried out by BSi, an independent assessor.
3 Level 1 (low) through 5 (high) indicate the performance rating. For details see MAC web site section for TSM.
Internal audit was not required to conduct the Best Practice Principles (BPP) Assurance Review (see below), but the completed questionnaires were reviewed by the external assessor, currently SGS and a physical verification/assessment was conducted at the Victor Mine.
The BPP program was amended for the 2010 Review to facilitate the transition to reporting under the Responsible Jewellery Council program. The number of questions asked in the questionnaire was increased, and at the same time, the questionnaires were tailored for the individual business units so that only relevant questions were asked in 2010. Further improvements are likely to made in 2011.
A questionnaire was completed for each operation, office and exploration project at De Beers Canada. The physical assessment at Victor Mine site however produced four major and two minor non-conformances or non-compliances as well as one opportunity to improvement (see Table 11-3). Corrective Action Plans have been prepared to address the identified findings and are being implemented. None of the findings were closed out by the end of 2010.
An environmental consultant prepares to cast out a minnow trap as part of environmental baseline studies.
De Beers Canada Inc. - 2010 Report to Society 88
Table 11-3: BPP third party audit findings - Victor Mine
Audit finding Severity
Lodging conditions, in temporary trailers used by contractors and newly hired De Beers employees pose a high safety risk due to frost heaves moving foundations.
Major
Appearance of mould in the temporary trailers living accommodation onsite at the mine.
Major
Inadequate change room locker facilities in the Dry process area. Major
Issue over hours worked resulting from no formal flight cut off time for flights that are delayed because of weather or mechanical issues.
Major
Inconsistent repetitive Non-Conformancesindicating inadequate implementation of High security Area General Rules.
Minor
Inadequate lockers for employees leaving high security area. Minor
The company’s business practice does not conform to the policies/provisions communicated to employees.
Opportunity for Improvement
Diamond exportsAll diamonds produced were exported to the Diamond Trading Company in compliance with the Kimberley Process Certification Scheme and the World Diamond Council System of Warranties. The export and import Kimberley Process certificates were reviewed by Deloitte and Touche to ensure compliance with the Kimberley Process Certification Scheme and World Diamond Council System of Warranties and there were no significant non-compliances.
Internal Audit at De Beers CanadaThe Internal Audit department at De Beers Canada is part of De Beers Internal Audit (DBIA) which operates throughout the Family of Companies. DBIA is an independent, objective assurance and consulting activity designed to add value and improve the operations of the De Beers Family of Companies that has been mandated by the Board Audit Committee, a sub-committee of the Board of De Beers Société Anonyme.
All DBIA reviews are performed in accordance with the International Standards for the Professional Practice of Internal Auditing as prescribed by the Institute of Internal Auditors (IIA). Our Quality Assurance and Improvement Programme (introduced in accordance with IIA Standard 1300) found Be Beers Canada Internal Audit to be “generally compliant” with the IIA Standards, the highest rating on the degree of conformity scale.
DBIA follows a prescriptive, documented risk based audit methodology that culminates in its annual report on risk management, the internal control environment and governance to the Audit Committee.
Audit work conducted includes a thorough review of internal systems, procedures and programmes of work for each audit unit included on the annual audit coverage plan.
Verification of this report
Global Reporting Initiative assessmentNo formal verification of the content of this report has been undertaken. Our self-assessment of this report suggests that it meets the criteria for a level of “A” under the GRI system.
Canadian Business for Social Responsibility (CBSR) supported our reporting process by helping us identify the actions required in order to move from a ‘C’ to ‘A’ GRI Application Level report. In pursuit of reaching the ‘A’ Application Level and reflecting future reporting trends, CBSR developed recommendations to meet Standard Disclosures as required by GRI, including:• Strategy and profile•Management approach, and• Performance indicators.
This work was performed using the Mining and Metals Sector Supplement. In addition to identifying reporting gaps against the requirements of the GRI Sustainability Reporting Guidelines, CBSR reviewed the reporting practices of peers, in order to reinforce recommendations on improving the De Beers Canada Report to Society.
Responsibilities and IndependenceDe Beers Canada was responsible for preparation of its Report to Society.
CBSR was paid by De Beers Canada to conduct the gap analysis and make the above recommendations. In addition, De Beers Canada is a member of CBSR and had commissioned CBSR with an assessment of De Beers Canada’s draft Report to Society based on the GRI Reporting Principles. Other than these payments, the assurance team declares itself independent in relation to De Beers Canada and its stakeholders.
De Beers Canada Inc. - 2010 Report to Society 89
Aboriginal Business A business that complies with the legal requirements and meets the following criteria:a) Is a limited liablility company with at least 51% of the company’s voting shares beneficially owned by one, or more, Aboriginal(s);b) Is a co-operative with at least 51% of the co-operative’s voting shares beneficially owned by Aboriginals;c) Is a sole proprietorship, or the proprietor of which is an Aboriginal; ord) Is a partnership, the majority interest in which is owned by one, or more, Aboriginals and in which the majority of the benefits under the
partnership agreement, accrue to such Aboriginal(s) and maintains a place of business, a manager and undertakes the majority of its management and administrative functions within the appropriate geopgraphic region.
Note: The actual definition varies slightly between individual agreements but broadly matches the above definition.
Brown Field: Land that has been explored or developed in whole or in part. This may include sites that are sparingly used or abandoned, or may contain evidence of earlier work by De Beers or other companies. It also refers to land that may contain possible contamination.
Bulk Sample A large sample of mineralized rock, frequently hundreds of tonnes, selected in such a manner as to be representative of the potential ore body being sampled. Used to determine metallurgical characteristics, diamond grade or value.
Carat Refers to the measure of weight of a diamond. One carat is equivalent to 200 milligrams. One carat can also be divided into 100 “points.” A 0.75-carat diamond is the same as a 75-point or 3/4 carat diamond.
Community of Interest Communities of Interest include all of the individuals and groups who have, or believe they have, an interest in the management of decisions about operations that may affect them. These include employees, contractors, Aboriginal or indigenous peoples, mining community members, suppliers, customers, environmental organizations, governments, the financial community and shareholders. These groups and individuals are often referred to as ‘stakeholders’ or COI.
Core The long cylindrical piece of rock approximately one and a half inches in diameter brought to the surface by diamond drilling.
De Beers Family of Companies A term used to refer to all the different entities that comprise all the De Beers companies, whether they are wholly owned or joint ventures, e.g. Debswana and Namdeb.
De Beers Group A term used to refer to all wholly owned elements of the De Beers Family of Companies. This would include, for example, De Beers Canada Inc., De Beers Botswana, the Diamond Trading Company.
Dyke A long and relatively thin body of igneous rock that, while in the molten state, intruded a fissure or crack into older rocks and that cuts across the layers of rock (bedding or strata). Dykes may be vertical, near vertical or inclined.
Felsenmeer Derived from the German meaning “sea of rock.” In a felsenmeer (also known as a block field), freeze-thaw weathering has broken up the top layer of rock, covering the underlying rock formation with jagged, angular boulders.
Green field Land that is unexplored and undeveloped but is available for exploration, industrial or commercial development.
Muskeg A bog, usually with grassy tussocks, growing in a wet, poorly drained boreal region, often in areas of intermittent permafrost. Tamarack and black spruce are commonly associated with muskeg areas. Old muskeg areas evolve into peat deposits.
Northern business A business that complies with the legal requirements to carry on a business within the NWT and meets certain criteria for permanent place of business, residence of the manager, undertakes the majority of its business within the NWT and is a business on which NWT residents have a substantial management authority or significant ownership.
Open pit A mine that is worked entirely from the surface. Also referred to as an open-cut or open-cast mine.Permafrost Soil or ground that is at or below freezing point of water for two or more years (i.e. it is permanently frozen). Ice is not always present, but it
frequently occurs and may be abundant. Most permafrost is located in high latitudes (i.e. land close to the North and South poles), or at high elevations (i.e. alpine permafrost).
Portal The surface entrance to a tunnel used to provide access to a mineral deposit underground.
Sampling The process of collecting representative portions of a material in order to study its constituents. Usually sampling is undertaken to determine the concentration of a mineral (for example diamond) in a deposit.
Sustainable development Industrial development that does not detract from the potential of the natural environment to provide benefits to future generations.
Whistle blowing The process of raising concern about a perceived, a potential or an actual wrongdoing or policy violation that has occurred or may occur in an organization or a body of people or to a person. When such concerns are raised, there is no retribution on the person or party raising the concern.
Glossary
De Beers Canada Inc. - 2010 Report to Society 90
Appendix A
GRI compliance table
Performance Indicators – GRI (G3) Sustainability Reporting Guidelines Page reference Extent
1.1 Statement from the most senior decision maker about the relevance of sustainability to the organization and its strategy. 4
1.2 Description of key impacts, risks and opportunities. 24-26
2.1 Name of the organization. 8
2.2 Primary brands, products and/or services. 8
2.3 Operational structure including main divisions, operating companies, subsidiaries, joint ventures. 8
2.4 Location of organization’s headquarters. 8
2.5 Number of countries where the organization operates, names of countries with major operations or that are specifically relevant to the sustainability issues covered in the report.
8
2.6 Nature of ownership and legal form. 8
2.7 Markets served (geographic breakdown, sectors served, and types of customers/beneficiaries). 8
2.8 Scale of the organization, including number of employees, net sales, total capitalization broken down in terms of debt and equity, and quantity of products produced.
8, 32-34
2,9 Significant changes during the reporting period regarding size, structure or ownership 8
2.10 Awards received in the reporting period. 1
Report profile
3.1 Reporting period (e.g. fiscal/calendar year) for information period. 2
3.2 Date of most recent previous report (if any). 2
3.3 Reporting cycle (annual, biennial). 2
3.4 Contact point for questions regarding the report or its contents. Inside back cover
Report scope and boundary
3.5 Process for defining report content, including: determining materiality; prioritizing topics within the report; identifying stakeholders the organization expects to use the report.
5, 22, 25
3.6 Boundary of the report (countries, divisions, subsidiaries, leased facilities, joint ventures, suppliers). 2, 8
3.7 State any specific limitations on the scope or boundary of the report. 8
3.8 Basis for reporting on joint ventures, subsidiaries, leased facilities outsourced operations, and other entities that can significantly affect comparability from period to period and/or between organizations.
3
3.9 Data measurement techniques and the bases of calculations underlying indicators and other information in the report. 3
3.10 Explanation of the effect of any re-statements of information provided in earlier reports and the reasons for such re-statement (e.g. Mergers/acquisitions, change of base years/periods, nature of business, measurement methods).
3, 73, 74
3.11 Significant changes from previous reporting periods in scope, boundary, measurement methods applied in the report. 3
GRI content index
3.12 Table identifying the location of the Standard Disclosures in the report. iv, v, 12, 16, 18, 20, 22, 24, 28, 31, 34, 35, 37, 50, 64, 81, 83, 86
Legend = Not reported = Partially reported = Fully reported
De Beers Canada Inc. - 2010 Report to Society 91
GRI compliance table
Performance Indicators – GRI (G3) Sustainability Reporting Guidelines Page reference Extent
Assurance
3.13 Policy and current practice with regard to seeking external assurance for the report. If not included in the assurance report accompanying the sustainability report, explain the scope and basis of any external assurance provided. Also explain the relationship between the reporting organization and the assurance provider(s).
86-88
Governance
4.1 Governance structure of the organization, including committees under the highest governance body responsible for specific tasks, such as setting strategy organizational oversight.
12-15
4.2 Indicate whether the Chair of the highest governance body is also an executive officer (and, if so, their function within the organization’s management and the reasons for this arrangement.
13
4.3 For organizations that have a unitary board structure, state the number of members of the highest governance body that are independent and/or non-executive members.
13
4.4 Mechanisms for shareholders and employees to provide recommendations or direction to the highest governance body. 15
4.5 Linkage between compensation for members of the highest governance body, senior managers and executives. 14
4.6 Process in place for the highest governance body to ensure conflicts of interest are avoided. 13, 14
4.7 Process for determining the qualifications and expertise of the members of the highest governance body for guiding the organization’s strategy on economic, environmental and social topics.
14
4.8 Internally developed statements of mission or values, codes of conduct, and principles relevant to the economic, environmental, and social performance and the status of their implementation.
7, 12, 14
4.9 Procedures of the highest governance body for overseeing the identification and management of economic, environmental, and social performance, including relevant risks and opportunities, and adherence or compliance with international agreed standards, codes of conduct, and principles..
13-15
4.10 Processes for evaluating the highest governance body’s own performance, particularly with respect to economic, environmental and social performance.
13-15
Commitment to external initiatives
4.11 Explanation of how the precautionary approach is addressed by the organization. 11
4.12 Externally developed economic, environmental, and social charters, principles or other initiatives to which the organization subscribes or endorses.
12, 41
4.13 Memberships in associations (such as industry associations) and/or national/international advocacy groups in which the organization: has positions in governance bodies; participates in projects or committees; provides substantive funding beyond routine membership dues; or views membership as strategic.
8
Stakeholder engagement
4.14 List of stakeholder groups engaged by the organization: communities. Examples of stakeholder groups are: communities, civil society; customers; shareholders and providers of capital; suppliers; and employees, other workers and their trade unions.
10, 54, 55
4.15 Basis for identification and selection of stakeholders with whom to engage. 27, 28, 50, 51
4.16 Approaches to stakeholder engagement, including frequency for engagement by type and group. 27, 28, 50-52
4.17 Key topics and concerns that have been raised through stakeholder engagement and how the organization has responded to those key topics and concerns, including through its reporting.
52, 57-63
Economic
EC1 Direct economic value generated and distributed, including revenues, operating costs, employee compensation, donations and other community investments, retained earnings and payments to capital providers and governments.
31-34
EC2 Financial implications and risks/opportunities to the organization’s activities due to climate change. 26
EC3 Coverage of the organization’s defined benefit pension plan obligation. 33
EC4 Significant financial assistance received from government. 33
Aspect: Market presence
EC5 Range of ratios of standard entry level wage compared to local minimum wage at significant locations of operations. 42
EC6 Policies, practices and proportion of spending on locally based suppliers at significant locations. 31, 34, 81, 82
EC7 Procedures for local hiring and proportion of senior management hired from the local community. 38
EC8 Development and impact of infrastructure investments and services provided primarily for public benefit through commercial, in-kind or pro bono engagement.
28
EC9 Understanding and describing significant indirect economic impacts, including the extent of impacts. 31
Legend = Not reported = Partially reported = Fully reported
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GRI compliance table
Performance Indicators – GRI (G3) Sustainability Reporting Guidelines Page reference Extent
Aspect: Materials
EN1 Materials used by weight or volume. 76
EN2 Percentage of materials used that are recycled input materials. 76
Aspect: Energy
EN3 Direct energy consumption by primary energy source. 72, 73
EN4 Indirect energy consumption by primary source. 73
EN5 Energy saved due to conservation and efficiency improvements. 72, 73
EN6 Initiatives to provide energy-efficient or renewable energy based products and services and reductions in energy requirements as a result of these initiatives.
72, 73
EN7 Initiatives to reduce energy consumption and reductions achieved. 72, 73
Aspect: Water
EN8 Total water withdrawal by source. 73-75
EN9 Water sources significantly affected by withdrawal of water. 74, 75
EN10 Percentage and total volume of water recycled and reused. 74, 75
Aspect: Biodiversity
EN11 Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected area.
78, 79
EN12 Description of significant impacts of activities, products and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas.
71
EN13 Habitats protected or restored. 71
EN14 Strategies, current actions, and future plans for managing impacts on biodiversity. 71
EN15 Number of IUCN Red List species and national conservation list species with habitats in areas affected by operations. 68, 70
Aspect: Emissions, effluents and waste
EN16 Total direct and indirect greenhouse gas emissions by weight. 73
EN17 Other relevant indirect greenhouse gas emissions by weight. 73
EN18 Initiatives to reduce greenhouse gas emissions and reduction achieved. 71-73
EN19 Emissions of ozone-depleting substances by weight. 73
EN20 NO, SO and other significant air emissions by type and weight. 73
EN21 Total water discharge by quality and destination. 74, 75
EN22 Total weight of waste by type and disposal method 76, 77
EN23 Total number and volume of significant spills. 64, 65, 68, 70
EN24 Weight of transported, imported, exported or treated waste deemed hazardous under the terms of the Basel Convention and percentage of transported waste shipped internationally.
76-79
EN25 Identity, size, protected status, and biodiversity value of water bodies and related habitats affected by the reporting organization’s discharges of water and runoff.
74, 78
Aspect: Products and services
EN26 Initiatives to mitigate environmental impacts of products and services and extent of mitigation. 78, 79
EN27 Percentage of products sold and their packaging materials that are reclaimed by category. 83
Aspect: Compliance
EN28 Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with environmental laws and regulations.
80
Aspect: Transport
EN29 Significant environmental impacts for transporting products and other goods and materials. 73
Aspect: Overall
EN30 Environmental protection expenditures and investment by types. 64
Legend = Not reported = Partially reported = Fully reported
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GRI compliance table
Performance Indicators – GRI (G3) Sustainability Reporting Guidelines Page reference Extent
Aspect: Employment
LA1 Total workforce by employment type, employment contract and region. 31, 38
LA2 Total number and rate of employee turnover by age group, gender and region. 39
LA3 Benefits provided to full time employees that are not provided to temporary or part-time employees, by major operations. 42
Aspect: Labour management relations
LA4 Percentage of employees covered by collective bargaining agreements. 39, 43
LA5 Minimum notice period(s) regarding operational changes, including whether it is specified in collective agreements. 43
Aspect: Occupational health and safety
LA6 Percentage of total workforce represented in formal joint management-worker health and safety committees that help monitor and advise on occupational health and safety programs.
45, 46
LA7 Rates of injury, occupational diseases, lost days and absenteeism and number of work-related fatalities by region. 47, 48
LA8 Education, training, counselling, prevention and risk control programs in place to assist workforce members , their families or community members regarding serious diseases.
49
LA9 Health and safety topics covered in formal agreements with trade unions. 43, 46
Aspect: Training and education
LA10 Average hours of training per year per employee by employee category. 43
LA11 Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing their career endings.
43, 44
LA12 Percentage of employees receiving regular performance and career development reviews. 14, 35, 43
Aspect: Diversity and equal opportunity
LA13 Composition of governance bodies and breakdown of employees per category according to gender, age group, minority group membership and other indicators of diversity.
13, 38
LA14 Ratio of basic salary of men to women by category. 40
Aspect: Investment and procurement practices
HR1 Percentage and total number of significant investment agreements that include human rights clauses or that have undergone human rights screening.
41
HR2 Percentage of significant suppliers and contractors that have undergone screening on human rights and actions taken. 41
HR3 Total hours of employee training on policies and procedures concerning aspects of human rights that are relevant to operations, including the percentage of employees trained.
41
Aspect: Non-discrimination
HR4 Total number of incidents of discrimination and actions taken. 40
Aspect: Freedom of association and collective bargaining
HR5 Structure including main divisions, operating companies, subsidiaries, joint ventures. 43
Aspect: Child labour
HR6 Operations identified as having significant risk for incidents of child labour and measures taken to contribute to the elimination of child labour.
40
Aspect: Forced and compulsory labour
HR7 Operations identified as having significant risk for incidents of forced or compulsory labour and measures to contribute to the elimination of forced or compulsory labour.
40
Aspect: Security practices
HR8 Personnel trained in the organization’s policies or procedures concerning aspects of human rights. 41
Aspect: Indigenous rights
HR9 Total number of incidents of violations involving rights of indigenous people and actions taken. 52
Aspect: Community
SO1 Nature, scope, and effectiveness of any programs and practices that assess and manage the impacts of operations on communities, including entering, operating, and exiting.
50-55, 59
Legend = Not reported = Partially reported = Fully reported
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GRI compliance table
Performance Indicators – GRI (G3) Sustainability Reporting Guidelines Page reference Extent
Aspect: Corruption
SO2 Percentage and total number of business units analyzed for risks related to corruption. 14, 24
SO3 Percentage of employees trained in organization’s anti-corruption policies and practices. 36
SO4 Actions taken in response to incidents of corruption. 36
Aspect: Public policy
SO5 Public policy positions and participation in public policy development and lobbying. 35
SO6 Total value of financial and in-kind contributions to political parties, politicians and related institutions by country. 35
Anti-competitive behaviour:
SO7 Total number of legal actions for anti-competitive behaviour, antitrust, and monopoly practices and their outcomes. 45, 84
Compliance
SO8 Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with laws and regulations. 84
Aspect: Customer health and safety
PR1 Life cycle stages in which health and safety impacts of products/services are assessed for improvement. 84
PR2 Total number of incidents of non-compliance with regulations and voluntary codes concerning health and safety impacts of products/services.
84
Aspect: Products and services labelling
PR3 Type of product and service information required by procedures and percentage of significant products and services subject to such information.
84
PR4 Total number of incidents of non-compliance with regulations and voluntary codes concerning product and service information, labelling, by type of outcomes.
84
PR5 Practices related to customer satisfaction, including results of surveys measuring customer satisfaction. 83
Aspect: Marketing communications
PR6 Program for adherence to laws, standards and voluntary codes related to marketing .communication. 84
PR7 Number of incidents of non-compliance with regulations and voluntary codes concerning marketing communications. 84
Aspect: Customer privacy
PR8 Total number of substantiated complaints regarding breaches of customer privacy and losses of customer data. 83
Aspect: Compliance
PR9 Monetary value of significant fines for non-compliance with laws and regulations concerning the provision and use of products and services. 83, 84
Revised MMSS as at 12Jan09
MM1 Amount of land (owned or leased, and managed for production activities or extractive use) disturbed or rehabilitated. 78, 79
MM2 The number and percentage of total sites identified as requiring biodiversity management plans according to stated criteria, and the number (percentage) of those sites with plans in place.
71
MM3 Total amounts of overburden, rock, tailings, and sludges presenting potential hazards. 78, 79
MM4 Number of strikes and lockouts exceeding one week’s duration, by country. 38
MM5 Total number of operations taking place in or adjacent to Indigenous People’s territories, and number and percentage of operations or sites where there are formal agreements with Indigenous Peoples’ communities.
51, 52
MM6A Number and Description of significant disputes relating to land use, customary rights of local communities and indigenous peoples. 52
MM6B The extent to which grievance mechanisms were used to resolve disputes relating to land use, customary rights of local communities and indigenous peoples, and their outcomes.
60, 63
MM7 Number (and percentage) of company operating sites where artisanal and small-scale mining (ASM) takes place on, or adjacent to, the site; describe the associated risks and the actions taken to manage and mitigate these risks.
16
MM8 List sites where resettlements took place, the number of households resettled in each, and how their livelihoods were affected in the process. 51
MM9 Number and percentage of operations with closure plans. 80
MM10 Significant incidents involving communities in which grievance mechanisms have been invoked to address them, together with their outcomes. 60-63
MM11 Number and description of incidents affecting employees, communities, or the environment in which emergency preparedness procedures were activated.
65, 68, 70
MM12 Programs and progress reports relating to materials stewardship. 76, 77
Legend = Not reported = Partially reported = Fully reported
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ISO26000 First edition 2010-11-017.2 The relationship of an organization’s characteristics to social responsibility 4
7.3 Understanding the social responsibility of an organization 2, 4
7.3.1 Due diligence 11, 24, 31, 64, 80
7.3.2 Determining relevance and significance of core subjects and issues to an organization v, 3, 5, 7, 14, 15, 24-26, 31, 36, 40, 43, 46, 49, 53, 64-68, 70, 76, 77, 80, 81, 87
7.3.2.1 Determining relevance 3
7.3.2.2 Determining significance 24-26
7.3.3 An organization’s sphere of influence 8, 13-15
7.3.3.1 Assessing an organization’s sphere of influence 8, 13-15, 35
7.3.3.2 Exercising influence 8, 35, 81, 83, 84
7.3.4 Establishing priorities for addressing issues 24-26, 37, 39, 45, 52
7.4.1 Raising awareness and building competency for social responsibility 2, 4, 6, 29
7.4.2 Setting the direction of an organization for social responsibility 4, 28, 29
7.4.3 Building social responsibility into an organization’s governance systems and procedures 13-15
7.5.1 The role of communication in social responsibility 2-5
7.5.2 Characteristics of information relating to social responsibility 3, 4
7.5.3 Types of communication on social responsibility 27-29, 50-55
7.5.4 Stakeholder dialogue on communication about social responsibility 50-63
7.6.1 Methods of enhancing credibility 50, 87-89
7.6.2 Enhancing the credibility of reports and claims about social responsibility 50, 87-89
7.6.3 Resolving conflicts of disagreements between an organization and its stakeholders 51-63
7.7.2 Monitoring activities on social responsibility 50, 87
7.7.3 Reviewing an organization’s progress and performance on social responsibility 50, 87
7.7.4 Enhancing the reliability of data and information collection and management 2, 3, 50, 54, 55, 59
7.7.5 Improving performance 4, 6, 15, 19, 24, 50, 55, 66, 72, 81
7.8.1 General 12
7.8.2 Voluntary nature of participation not reported
7.8.3 Considerations not reported
Appendix B
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Contact informationReaders are encouraged to provide feedback on this report and its content to the Director of External and Corporate Affairs (contact details below). We would especially like to know about any shortcomings in this report and areas that you would like to see included in future reports. Additional information may be obtained by any of the following means:
(i) See contacting any of the individuals listed below;(ii) by going to the De Beers Canada website and following links to the
Report to Stakeholders; or(iii) By submitting a request to [email protected]
For further information, please contact one of the following:
For De Beers Canada Inc., Corporate division, Exploration division and Victor Mine:
Tom Ormsby – Director, External and Corporate Affairs900-250 Ferrand Drive, Toronto, Ontario, Canada, M3C 3G8.Telephone: +1 416-645-1710 ext 2151Facsimile: +1 416-429-2462E-mail: [email protected]
For De Beers Canada Snap Lake Mine and Gahcho Kué Project:
Cathie Bolstad – Director, External and Corporate Affairs, NWT ProjectsSuite 300, 5102 50th Avenue, Yellowknife, Northwest Territories, XIA 3S8.Telephone: +1 867-766-7325Facsimile: +1 867-766-7347
Website: www.debeerscanada.comRelated websites: www.debeersgroup.com www.dtc.com
Reporting StandardNo formal verification of this report has been undertaken. Our self-assessment suggests that it meets the criteria for a level of “A” under the Global Reporting Initiative (GRI), including the Metals and Mining Sector Supplement.
Canadian Business for Social Responsibility (CBSR) supported our reporting process by helping identify the actions required to move from a GRI Application Level “C” to a Level “A” report. For further details, please see the Assurance section.
Feedback and additional information