A new practical approach to risk management for underground mining project in Quebec

Highlights

• A new practical approach to risk management in mining projects is presented.

• This approach is based on a novel concept called “hazard concentration”.

• This study shows the importance of taking OHS into account in all operational activities of the mine.

• An adaptable database cataloguing about 250 potential hazards in an underground goldmine was constructed.

Abstract

The mining industry worldwide is currently experiencing an economic boom that is contributing to economic recovery and social progress in many countries. For this to continue, the mining industry must meet several challenges associated with the start-up of new projects. In a highly complex and uncertain environment, rigorous management of risks remains indispensable in order to repel threats to the success of mining.

In this article, a new practical approach to risk management in mining projects is presented. This approach is based on a novel concept called “hazard concentration” and on the multi-criteria analysis method known as the Analytic Hierarchy Process (AHP). The aim of the study is to extend the use of this approach to goldmines throughout Quebec. The work is part of a larger research project of which the aim is to propose a method suitable for managing practically all risks inherent in mining projects.

This study shows the importance of taking occupational health and safety (OHS) into account in all operational activities of the mine. All project risks identified by the team can be evaluated. An adaptable database cataloguing about 250 potential hazards in an underground goldmine was constructed. In spite of limitations, the results obtained in this study are potentially applicable throughout the Quebec mining sector.

Introduction

The mining sector has been experiencing a period of strong growth over the past few years. Mining companies and subcontractors (construction, consulting engineers, equipment suppliers, etc.) are all benefiting from renewed exploration, development and start-ups (Schmouker, 2011). Governments of countries in which these projects are underway view the current boom as a lever for helping the economy out of the recession that has been hindering economies around the world for at least as many years (Humphrey, 2011). These countries, including Canada, pin much hope on the contribution of mining to economic recovery and have put many projects on the fast track by contributing to innovation and the promotion of mining entrepreneurship (e.g. MRNF, 2012).

Canada is a leader among mining nations, world leader in the production of potash and uranium, second producer of nickel and cobalt and third in extraction of several other metals (The Canadian Mining Journal, 2008). Like several other Canadian provinces, Quebec is benefiting from the current development of the mining industry, with numerous high-potential mineral and metal deposits, including gold, nickel, cobalt, zinc, platinum, iron, copper, lithium, vanadium and rare-earth elements (Quebec Government, 2011). This industry contributes an estimated 2.7% of the provincial GDP (QMA and QMEA, 2010, 28 p.), a figure growing in view of the number of mining projects underway in the context of the Plan Nord^® program. There are currently 11 new projects well into the developmental phase (Rousseau, 2011).

A territory twice the size of France has been thus marked for new mining projects (Fig. 1). The Plan Nord^® represents investment potential valued at $80 billion, of which $33 billion will be earmarked for the mining sector, related industries and workers, including roads, housing, transportation, schools, health, telecommunications, airports and so on (Rousseau, 2011).

The development of the mining industry in sparsely populated areas lacking infrastructures poses several challenges, risks and uncertainties associated with overcoming long distances, appealing to an ageing labour force, recruitment, training and keeping workers, and availability of subcontractors and suppliers (CSMOM, 2012; Doggett, 2007; Kral, 2006). Starting up several projects at the same time in a given region requires careful planning and huge efforts from both the business community and public authorities. Poor synchronisation between the development of mining projects and of the required infrastructures and labour can lead to early failure. Interruption of projects would have province-wide political and economic fallout and is not an acceptable risk. The mining industry itself will not agree to begin activities in a climate of uncertainty, given the financial burden and complexity of the projects being considered (Chinbat & Takakuwa, 2009). In addition, public pressure to ensure safe and responsible mining of deposits as well as economic benefit to the taxpayer is huge and adds considerably to the challenges of any business or government contemplating such an undertaking.

In an effervescent economy, mining companies must identify and implement risk and uncertainty monitoring and control strategies. The mining industry must also adapt and implement major measures in order to deal with a variety of problems and challenges (e.g. Rousseau, 2011). Concerns with productivity and the advantages of using innovative equipment and new methods of extraction must not be examined only from an economic perspective, nor should personnel requirements be evaluated only in terms of operational indicators. Interdisciplinary and participative evaluation of operational needs and activities throughout all project phases reduce the likelihood of overlooking relevant risks (Pal & Dewan, 2009). A mining project is by nature very complex and marked by numerous interactions between endogenous as well as exogenous factors, thus requiring major efforts in order to eliminate risks that threaten to delay or block the achievement of goals (Badri, Nadeau, & Gbodossou, 2011).

Systematic management of risks and uncertainties remains the most effective means of ensuring maximum safety of a mining project and covering all phases of the project life cycle (e.g. Orsulak, Kecojevic, Grayson, & Nieto, 2010). For increased effectiveness, risk management should go beyond technical and environmental feasibility studies and take into consideration several types of threats often neglected, underestimated or hidden because of the complexities of the industrial context. Setting and achieving such objectives will not only improve the social capital and image of the industry, it will also increase feelings of security among workers, businesses and surrounding communities as well as throughout the mining sector in general.

This article aims to promote the use of a new practical approach to risk management in underground goldmines in Quebec. New concepts developed, validated and utilized in open-pit mining have been adapted to underground mining. This work identifies limitations, proposes improvements to implementation and considers opportunities expanding the range of applicability. This work is part of a larger research project with the aim of devising an approach suitable for managing practically all types of risks associated with mining projects.

Section 2 reviews the particularities and challenges in the mining industry and discusses risk management as well as several methods thereof in mining companies. Section 3 presents the research methodology and describes the proposed practical approach to risk management. The results are presented in Section 4, while Section 5 contains discussion of the value and limitations of the approach. Section 6 contains a summary of the findings as well as the conclusion.