Joe Mehrkens is a retired forest economist living in Petersburg.
On Oct. 24, a public forum was held on the potential impacts to the Southeast fishing industry from new large mines in British Columbia. This is not the same old battle between greenies and boomers over development. It is a large, growing problem that has no institutional mechanisms to ensure environmental safeguards or provide any means to compensate third parties for potential damages.
This summer, a large tailings dam failed at the Mount Polley mine. The broken dam dumped 14.5 million cubic feet of water and slurry into salmon waters (Polley Lake, Hazeltine Creek, Quesnel Lake and Cariboo Creek). Even more disturbing, these polluted waters are a tributary of the Frazier River — the most productive sockeye salmon river in British Columbia. While total damages will be not quantified for years, it is characterized as Canada’s worst environmental disaster in modern times. Many more large mines are planned as BC expands its energy grid to new mineral deposits.
The Mount Polley failure may be a harbinger of the future. Environmental restoration will be minimal or nonexistent, and there will be no compensation for damage to non-mining interests — on either side of the border. Even if damaged parties successfully sue for damages, the mining company can go bankrupt. That process can result in shallow pockets when it comes to damage awards.
One root cause for no redress is that catastrophic events have low probabilities of occurring but result in large negative consequences. As Dr. David Chambers presented at Friday’s forum, no insurance company is willing underwrite these operations — not even Lloyds of London. The risk pools (other mines) are too small and the liabilities are too great. The same is true for bonding. The risks are too uncertain to accurately determine fair bid prices. That leaves public taxpayers and private victims — on both sides of the border — holding the bag.
Since catastrophic events are nearly impossible to mitigate, trust fund investments are required for stronger safeguards to finance long-term waste management and perpetual pollution control. They are also needed to compensate for economic damage. Qualifying damage needs to include both catastrophic problems as well as low-level chronic problems to water quality and fish habitat.
The only possible solution is an international treaty that allows both industries to coexist. While no solution exists today, there is a U.S.-Canada treaty signed in 1908 that provides for an International Joint Commission. More importantly, there are explicit treaty provisions to protect water quality. This is a good start, but this policy group cannot enforce its recommendations.
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