Abstract
For many years, mine-impacted water has been regarded as a problem and linked to long-term environmental liabilities. However, this water can be a renewable and a sustainable resource, provided that it is managed in a responsible and sensible manner. South Africa's National Water Resource Strategy (NWRS, 2013) considers water that can be used to contribute to economic activity to be a water resource. Although all water resources are considered as belonging to the State, government does not appear to have meaningfully explored the use of mineimpacted water to contribute to the country's economic activity. Africa is blessed with more sunshine than anywhere else, apart from Australia, yet we see no rollout of vast quantities of solar panels to ensure every African family has access to affordable power. This suggests that governments are incapable of managing such a free resource. At the same time, apart from the equatorial areas, water is a seriously constrained resource and yet we expect the same entities to manage a commodity none of us can live without. This paper explores the conversion of mine-impacted water from waste to a resource and how the inclusion of other stakeholders (such as water users, landowners, and ordinary South Africans) could benefit the process.
Highlights
Mining activities have been accompanied by a legacy of environmental issues resulting from the discharge of mine-impacted water from old mine operations
As many of the decommissioning and closure activities of mining operations have the potential to vary on a year-on-year basis, the International Financial Reporting Standards (IFRS) require that an Asset Retirement Obligation (ARO) is recognized within the auspices of International Accounting Standard (IAS) 37
Liability—The future sacrifices of economic benefits that the entity is obliged to make to other entities as a result of past transactions or other past events, the settlement of which may result in the transfer or use of assets, provision of services or other yielding of economic benefits in the future. (International Financial Reporting Standards, 2008)
Summary
Mining activities have been accompanied by a legacy of environmental issues resulting from the discharge of mine-impacted water from old mine operations. For many years, this mine-impacted water has been regarded as a residual problem and linked to long term environmental liabilities. The National Environmental Management Act No 107 of 1998 (NEMA) requires that this liability, including the responsibility for extraneous or polluted water, continues after closure. The inclusion of this requirement, setting out how to calculate the financial provision, is a clear indication that the quantum of the provision will necessarily increase over time. This will reflect as a significant liability on the balance sheet
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