Fact Sheet3.17 Closure and Reclamation

The Closure and Reclamation Section outlines how the Ajax Project will prepare for agricul-tural and other land uses once mining has fi nished, or if the Project needs to close tem-porarily. Closure is the time when mining and ore processing has stopped. If closure is per-manent, a part of the process is reclamation, which includes removing buildings and equip-ment, landscaping and planting trees and other plants, and restoring natural water fl ow across the Project footprint.

Closure and reclamation is regulated by fed-eral, provincial, and local governments, and includes feedback from the general public, local residents, Aboriginal groups, and many other stakeholders from the area. The goal of reclamation planning is to ensure mining has a long-term positive environmental legacy.

KGHM Ajax Mining Inc.'s (KAM) Objectives for Closure and Reclamation

Return the land to a state that supports cattle and wildlife.

Return the land to a state that supports agricultural activities as a priority over other uses.

Use progressive reclamation strategies during operations as much as possible.

Re-establish the natural fl ow of water between Peterson Creek and Jacko Lake.

Cover the tailings storage facility and mine rock storage facilities in a way that supports wildlife and agriculture.

Establish a holding area to temporar-ily store water while it is treated for later release into the environment.

Key Elements of Closure and Reclamation

To meet the Projects closure and reclamation objectives, KAMs activities will centre around four main elements: soil management, reveg-etation, closure, and monitoring.

Soil Management:

Soil is important to support revegetation, so topsoil removed during construction or opera-tions is stored for use during reclamation.

The most e ective way of protecting stored soil from erosion by wind or water is to plant soil storage areas with grasses and other plants to keep dust down.

Overburden is composed of deeper-lying soils less suitable for reclamation because of their coarser or harder texture. Overburden can be used for landscaping such as to create

Fact Sheet:3.17 Closure and Reclamation

Key Fact

After the useful life of the mine is complete, the Closure and Recla-mation plan will ensure the site returns to productive agricultural, recreational, and other benefi cial uses.

KGHM Ajax Mining Inc.: Fact Sheet

3.17 Closure and Reclamation

post-mining landforms and to separate mine rock or tailings from topsoil at the end of the mine life.

Scientists found some places at the site where existing soil conditions had levels of metals that exceed guidelines for agricultural or industrial use, due to previous mining (the quality of this soil will be tested again for its suitability before it is used for reclamation).

Revegetation:

The revegetation process will be progressive, using grasses and other local plant species as soon as possible, and will be monitored throughout the mine life and after Project clo-sure to ensure success. Revegetation will:

Support cattle grazing at the site, in line with the Project areas current use for agriculture;

Support wildlife habitat comparable to what was in place before mining began;

Physically stabilize disturbed areas;

Prevent weeds (invasive species) from taking over the disturbed areas;

Reduce erosion from wind and water, thereby keeping down dust; and

Provide habitat for self-sustaining ecologi-cal communities.

Closure:

Temporary closure is a state when the mine closes unexpectedly for short periods. In this case, facilities would be put into a mode called

care and maintenance, in which hazardous materials are inventoried and stored, equip-ment is locked down, the site is closed, and access is restricted.

Permanent Closure occurs once the mine comes to the end of its useful life. The per-manent closure process is estimated to take a total of fi ve years and includes the following activities:

Pipelines, power lines, and other infrastruc-ture will be dismantled, and materials will be salvaged or disposed of safely;

Water fl ows (if previously diverted to avoid contact with the mine) will be reverted into long-term natural channels and fl ow pat-terns; and

Once secured and cleaned, the open pit will be allowed to refi ll with rainwater and groundwater.

Closure costs are estimated at $195 million (in 2015 dollars) to close the site. KAMs esti-mate provides a dollar fi gure for closure and reclamation activities if the government were to undertake them, per the regulatory require-ment. Actual costs would be paid by KAM over the life of the Project.

The closure workforce is expected to be small-er than the operations workforce. Some of the workforce is expected to remain employed to implement decommissioning, closure, and reclamation activities over the course of the fi ve-year decommissioning and closure period. After this period, sta levels would be very low to intermittent.

Monitoring:

KAM will monitor the environment onsite throughout the life of the mine. Monitoring plans are reviewed and updated on a regular basis over the life of the Project. For closure, important monitoring includes:

The safety of dams, including underlying ground stability;

Types and coverage of plants in reclaimed areas, and plants uptake of minerals;

Surface water and groundwater; and

Aquatic life in the water bodies downstream of the Project.

KGHM Ajax Mining Inc.124 Seymour Street Kamloops BC, V2C 2E1

tel. (+1) 250 374 5446 fax (+1) 250 374 5443www.ajaxmine.ca

Questions & Answers

How Do We Know What the Site

Will Look Like After Reclamation?

The Ajax Project site includes historic mine operations that used open pits and mine rock storage areas. Since the end of previous mining activities, those facilities have been reclaimed and revegetated and are now largely indistin-guishable from the natural surroundings. This demonstrates the potential e ectiveness of Project closure and reclamation methods to return the area to its previous agricultural land use.

How do We Know it Will be Paid For?

B.C.s Chief Inspector of Mines requires each company to demonstrate how it will pay for a projects closure and reclamation costs before construction or operations begin. This cost estimate is updated on a regular basis over the mine's life to ensure adequate funds are available to do whatever is needed to return the area to pre-mine use.

KGHM Ajax Mining Inc.: Fact Sheet

3.17 Closure and Reclamation