1. Mining, sustainability and the EECCA region

This chapter discusses the environmental impacts of mining operations at different stages of the mine lifecycle, including impacts on water, soil, biodiversity and climate change. It also provides context on sustainability trends and drivers in the mining sector. Mining across the countries of Eastern Europe, the Caucasus and Central Asia (EECCA) is explored, with a focus on its economic importance and the need to improve environmental performance. Finally, this report is put in context with ongoing OECD work related to the region and to the mining sector, as well as projects and conventions at the international level that can help shape sustainability and the mining sector in the EECCA region.

    

1.1. Introduction

Mining remains an important economic sector for many countries in the Eastern Europe, Caucasus and Central Asia (EECCA) region. At the same time, EECCA countries are adopting strategies to promote green growth. They aim simultaneously to improve livelihoods, while decoupling economic growth from destructive environmental practices. Determining the role of government policies in rationalising green growth strategies with the extractive sector, and improving the environmental performance of mining operations, are critical challenges.

The immediate impact of mining on ecosystems and human health, as well as long-term concerns about climate change and global ecosystem sustainability, is sharpening focus on the environmental footprint of the mining sector. Whether underground or open pit, mines have the potential to affect their environment, both locally and over broader geographic areas, including across borders.

Despite the potentially negative environmental impact of mining, the transition to a greener economy will continue to require new sources of minerals and metals. Even the most optimistic circular economy projections anticipate a continued need for new primary sources of metals and minerals. In this context, governments play a vital role in ensuring better environmental performance in the mining sector and ensuring that industry can be a progressive part of greening the economy. Although there is an inherent contradiction in the term “green mining”, the mining sector can improve its environmental performance and reduce impacts.

1.2. Environmental impacts of the mining sector

As its name suggests, the extractive sector involves the permanent removal of natural resources from the ground. This takes a variety of forms, including surface mining (most commonly open-pit), underground, in-situ and heap leaching, as well as small scale and artisanal mining. Each of these carries its own environmental challenges. Beyond that, the geographic characteristics and location of the mine form the underlying environmental risks and challenges for both ecosystems and surrounding communities.

The potential environmental impacts of mining can be seen as a series of nested circles. They begin with the immediate impact of the mine – the hole that is dug, the tunnels that are built, the soil and water that are displaced. They continue with impacts on the wider ecosystem – how water is used or contaminated, how habitats are disturbed or destroyed, and how biodiversity suffers. This is not just limited to the mine site itself, but also encapsulates the transportation and energy infrastructure needed for most projects. Going larger still, airborne emissions from mining can contribute to both local air pollution and greenhouse gases.

Figure 1.1. Environmental impacts of mining

Note: GHGs = greenhouse gas emissions.

Source: Author’s graphic; MIT 2012. “Environmental risks of mining,” Massachusetts Institute of Technology.

Related to these environmental impacts, but potentially distinct in terms of the policy responses, is the impact of mining on people. Most directly, noise and air pollution affects the health of workers involved in mine operations. These impacts affect people in nearby communities as well, who in addition suffer from habitat destruction. The productivity of those who earn their livelihood from the land, including from food production and agriculture, is affected by contaminated water and soil. Contaminated air, water and soil can also have major health impacts.

1.2.1. Impacts on water, air and soil

The degree and type of environmental impact depend on the mining method, on the geography and ecology, and on the geology and the specific metals and minerals mined. Beyond the extractive process itself, most mined materials need to be processed to separate the economically valuable metals and minerals from the waste rock. This process normally occurs on site to reduce transportation costs, and is itself a major component of both energy and water use, as well as potential emissions.

The mining of a wide number of base metals, including gold, copper and nickel, can result in mine waste that acidifies water. It causes significant ecological damage, impacting biodiversity in both land and water. In addition to being highly acidic, the water also dissolves heavy metals and other toxic elements into it. Damage can occur from tailings and mining waste, as well as from the active mining site itself. Acidification can occur through a variety of chemical processes, but most often with iron sulphide associated rocks (Akcil and Koldas, 2006[1]).

Acid mine drainage can form during any stage of the mining process, including both surface and underground mining. During the operational phase, the danger is normally not as significant. In a properly regulated mine, water is pumped and treated, and prevented from mixing into the groundwater. However, after a mine has closed, monitoring is generally reduced, if it occurs at all. In both underground and open pit mines, mining often occurs below the water table. With the pumps shut, returning water dissolves minerals and rock, and becomes acidic. In waste dumps and tailings storage areas, this same process can have even more devastating results as the base material is more concentrated. Even where tailings are managed, unexpectedly high rainfall or other weather conditions can cause dams and earthworks to fail. This, in turn, can lead to destructive discharges of highly acidic water into the water table (Johnson and Hallberg, 2005[2]).

The effects of such accidents, especially if transboundary rivers are polluted, can affect neighbouring countries. The 2000 Baia Mare accident in Romania, for example, triggered by heavy rainfall, released 100 000 m³ of cyanide into the Somes River. It had severe effects outside the country, threatening the drinking water supply of more than 2.5 million Hungarians. It also killed 1 200 tonnes of fish, causing 15 000 people in Hungary’s fishing industry to lose their livelihoods. Other than high rainfall, severe weather events such as earthquakes, floods and extreme heat can also cause tailings failures. Technological accidents trigged by natural hazards can, in turn, trigger domino/cascade events (OECD, 2015[3]).

Box 1.1. Environmental impact by mine type

Surface mining, including open pit, strip and mountain top removal, is the most common form of mining. Material is excavated and processed, with different techniques depending on the metals or minerals being sought. Because the economically viable minerals or metals are generally not on the surface, substantial quantities of overburden and “waste rock” must be removed and relocated. This has direct environmental impacts – the destruction of habitats for flora and fauna, and the exposure of ore that can contain radioactive elements and asbestos.

The pits often go below the level of the water table. To facilitate deeper mining, water is progressively pumped out. In addition to the risks of water contamination during the mining process, the pumping also leads to issues when the mine is shut down and the water table rises again. Mining by-products left behind can contaminate the water and drastically change its pH level, leading to broader damage to surface and underground water.

Underground mining also involves the removal of substantial amounts of waste rock and the disturbance of flora and fauna. It can contribute to changes in the landscape when tunnels collapse, land subsides and sinkholes develop. Water contamination is a common issue, as water is pumped out of mines that are below the water table. As with open pit mining, pumped water can contaminate surface and groundwater if not properly monitored and controlled. The same issues exist with tailings ponds.

In-situ leaching (ISL) causes minimal surface disturbance. Holes are drilled from the surface; once the mineral deposit is reached, a leaching solution is pumped into the holes to dissolve the minerals. The solution containing the minerals is then pumped to the surface, where the desired minerals are processed out of the solution.

ISL does not cause dust or airborne radiation pollution or disturb flora and fauna on the surface. However, it does require treatment of substantial quantities of wastewater. Because the dissolving solution is highly acidic, it can also dissolve toxic and radioactive elements. The solution needs to be thoroughly treated before being released again to avoid contamination of the water table. Otherwise, it must be stored in tailings ponds.

Similar to ISL, heap leaching involves dissolving (leaching) valuable minerals from waste rock. However, the ore is first mined and piled on to a large area with a sealant underneath to prevent leakage. Heap leaching avoids releasing dust from pulverising the rock, and thus avoids the risk of leaking directly into the water table associated with ISL. However, the solution still needs to be properly treated and disposed of. In addition, the heap leaching area itself must be properly sealed, with waste stored in tailings ponds or treated.

Different mineral concentrating and beneficiation processes, including smelting, electrowinning and floatation usually take place at or nearby the mine site. They have significant environmental impacts. Ore is pulverised and mixed with water into a thick solution to separate the targeted material from the waste rock. Separating minerals and metals can introduce other environmentally harmful substances, such as arsenic. Once separated, the mixed waste rock and water is left in tailings ponds, which can be toxic and radioactive. If not properly stored, tailings can leak into the water table and surrounding environment.

A tailings failure may also result in uncontrolled spills of tailings, dangerous flow-slides and release of hazardous substances. This, in turn, can lead to major environmental catastrophes within and across borders. Pulverising the ore creates dust, which leads to air pollution and can further release the aforementioned elements. In addition, tailings can dry out and the dust can be spread over tens of square kilometres due to strong winds. This can affect human health and the environment in the surrounding areas.

Source: MIT (2012), “Environmental risks of mining.” Mission 2016: The future of strategic minerals.

The impact of the mining sector on air, water and soil is evident across the EECCA region. In Armenia, there are at least 15 active tailings ponds covering 700 hectares. There is little oversight of these ponds. They are vulnerable to weather events and have significant potential to impact human health (World Bank, 2014[4]). Pure Earth, a non-governmental organisation, organised a Toxic Site Identification Program in conjunction with the World Bank and other development partners. It found these sites were contaminating soil, groundwater and surface water with toxic metals such as cadmium, lead and arsenic. Toxins were found to be entering into ecosystems. When contaminated water was used for irrigation or the tailings were used for local building materials, the toxins were affecting human health (World Bank, 2014[4]).

Bioaccumulation is a major issue with many heavy minerals. Through this process, toxins concentrate as they move up the food chain from water, to soil, to the plants that grow in soil, to the people that eat the plants or use them for livestock feed.

In Armenia, a study found that mercury from mining operations had polluted soil and water fed into crops and cows’ milk. It found mercury in the hair of children living in impacted areas (Sahakyan, 2015[5]).

In Ukraine, the metallurgy industry is a leading source of wastewater discharges, while mining and quarrying were responsible for 37% of industrial air pollution in 2004. Waste rock and mining tailings from ferrous metal mining operations have contributed significantly to acidification of local water. They have also led to leaching of heavy metals such as cadmium, arsenic and lead. The mining sector generates about 120 million tonnes of waste annually (UNECE, 2007[6]). The past tailings accidents in Kalush (2005) and Nikolaiev (2011) demonstrate the urgent need for action to deactivate some of these “ticking time bombs”.

In Kazakhstan, the mining and metallurgical sector (excluding hydrocarbons) is one of the biggest polluters in the country, with varying impacts depending on the metals mined and the associated geography. For example, one study estimated that by 2006, 21 billion tonnes of solid waste had accumulated from the mining sector, with an additional 1 billion tonnes added every year. Tailings ponds from polymetallic mining operations continue to leak into groundwater, while gold mining operations often still use cyanide in their processing (UNECE, 2008[7]). The negative environmental impact that an uncontrolled spill of hazardous substances from tailings facilities could create, have been demonstrated, not least, by the mining waste spill in Ridder in 2016 (The Siberian Times, 2016[8]).

1.2.2. Impacts on biodiversity and ecosystem integrity

Mining impacts biodiversity in a variety of ways. It destroys habitats in the immediate area of mining activity. It breaks up wildlife corridors through the construction of transportation infrastructure. It contaminates air, water and soil with toxins. And it changes the pH balance of water and soil, thus affecting flora and fauna in those habitats. Depending on the size and type of mine, as well as the controls taken to reduce impact, the loss of biodiversity may be local without broader impact.

The type of mining can influence its effect on biodiversity. Open-pit mining tends to have a greater impact on biodiversity, destroying or significantly disturbing habitat in the immediate impact of the mine. Underground mining, heap and in-situ leach mining do not necessarily cause as much surface damage. However, they can still have major negative effects on biodiversity through water, soil and air quality damage.

Impact on biodiversity can be difficult to predict. Pools created by closed underground mines can form valuable habitats for certain species (Dolný and Harabiš, 2012[9]). The same can be true of open pit mines, but it depends significantly on the underlying geology and the potential for acidification.

Compared to agriculture, mining can actually have a relatively controlled effect on biodiversity. Even open pit mines tend to use less land than agriculture. However, this does not account for other indirect and direct means through which mining can impact ecosystem integrity and biodiversity (Rolfe, 2001[10]). The local effect on biodiversity in the immediate area around a mine can become more significant and widespread if numerous mine sites are operating in the same area.

Releases of mining waste into water, unplanned or planned, can massively expand the geographic impact on biodiversity. This is relevant for the countries in EECCA. There are numerous mines developed under older mining regimes with more lax regulatory setups. Similarly, many mines continue to operate for socio-economic reasons despite violating environmental regulation.

Box 1.2. Industry solutions to biodiversity concerns in mining

Major mining companies have shown a strong interest in trying to address threats from mining to biodiversity. They are responding both to regulatory pressures and the need for “social licence to operate. The International Council of Mining and Metals collaborated with the International Union for Conservation of Nature to develop the Good Practice Guidance for Mining and Biodiversity ( (ICMM, 2006[11])). Approaches to addressing risks to biodiversity from mining projects emphasise:

• having a deep understanding of the ecosystem and the biodiversity that exists through baseline studies

• the importance of addressing the situation before the mining process starts, and including specific considerations for biodiversity at the exploration, operations, and closure and rehabilitation stages

• avoiding decisions that would damage the ecosystem and, if the ecosystem will necessarily be impacted, then minimising the damage as much as possible

• taking steps to repair damage to specific ecosystem features

• offsetting damage by investing in improving or protecting other areas if damage around a mine site cannot be avoided or restored.

Source: ICMM 2017, “Good Practice Guidance for Mining and Biodiversity”, International Council of Mining and Metals (ICMM).

1.2.3. Mining, climate change and GHG emissions

Mining operations contribute to climate change through energy use in day-to-day operations, through the release greenhouse gases (GHGs) in smelting and other beneficiation processes, and through the destruction of carbon sinks, mainly in the form of forests. Many mining companies are reducing their carbon footprint through more efficient use of fuel and other energy inputs, electrification of vehicles and use of renewable energy. However, they will also need to adapt to climate change itself (Odell, Bebbington and Frey, 2018[12]). With its remote locations, reliance on water sources and exposure to severe weather, the mining sector could be significantly impacted by climate change.

In filings with the Carbon Disclosure Project from 2009, more than three-quarters of responding mining companies identified climate change as a concern. Areas of concern included disturbance to mine infrastructure and projects, changing access to supply chains and distribution routes, worker health and safety conditions, environmental management and mitigation, community relations, and exploration and future growth (Nelson and Schuchard, 2010[13]).

Major weather events, warmer or colder than normal temperatures, and droughts or floods are becoming more common, although it is difficult to attribute particular events or shifts to climate change. Weather events can have a major impact on mining operations. Although mining companies acknowledge these risks, many are reluctant to act because there are other more immediate costs (David Suzuki Foundation, 2009[14]). Companies would do well to plan for a storm that occurs once in 500 years; if it occurs, the breach of a tailings dam could have disastrous environmental impacts. However, climate change is a long-term threat for many operators, and heir priority is complying with regular environmental restrictions to their operations.

Box 1.3. Impact of climate conditions on mining operations

Climate change presents risks to the mining sector, both for those operating in remote areas and for mines that are grid-connected and closer to population centres.

• Increased frequency of extreme weather events: mines generally need to be prepared for an extreme weather event that will occur once in 50 years or once in 100 years. The risk of these events is manifold – high-water levels can cause tailing dams to breach with catastrophic results. Storms considered to occur once every 100 years now arrive with much more regularity.

• Transportation challenges related to extreme weather: mines in remote areas in cold climates often rely on ice roads. A warming climate is already making those roads less reliable and shortening the season of their operation. Other remote mines rely on air resupply, which faces a different set of challenges: more frequent extreme weather makes flying much more difficult.

• Impact of rising temperatures on air quality: rising temperatures and humidity levels contribute to reduced air quality through retention of particulate matter. This is an issue in areas where mines are operating close to population centres. It can force mines to shut operations on a daily basis to avoid exceeding pollution limits.

Source: (David Suzuki Foundation, 2009[14]).

1.3. Sustainability trends in the mining sector

One of the oldest industries known to humans, mining has constantly evolved with new developments in technology. However, it has adapted to environmental concerns more slowly. Mining most often occurs in remote or sparsely inhabited areas. Consequently, access to information on environmental impact has historically been low except in cases of environmental catastrophe. This is no longer the case. Today, sustainability reports are de rigueur for leading mining companies, and environmental concerns are increasingly at the forefront of discussions (Jenkins and Yakovleva, 2006[15]).

While environmental impact is intrinsic to mining, new driving factors have begun to shift the industry towards better environmental performance. These drivers, which include technology development, economic trends and societal expectations, are highlighted below:

• better awareness and understanding among the public about environmental issues related to mining, including the danger from tailings dam disasters, as well as better information dissemination concerning environmentally impacts when they occur (Jenkins and Yakovleva, 2006[15])

• global concern about climate change and GHG emissions, influencing both mining operations, as well as mineral fuels being mined (coal and bitumen) (Odell, Bebbington and Frey, 2018[12])

• increasingly stringent environmental regulation in jurisdictions like Canada, Australia and the United Kingdom that are home to globally active mining giants

• international initiatives that force better standards across entire value chains, thereby providing a strong incentive for large publicly listed multinational mining companies to ensure that suppliers and sub-contractors abide by the same environmental performance standards as the parent company espouses to its shareholders

• technology advancements that ensure better environmental performance, both through pollution management and control, as well as from optimising operations to use fewer inputs and the shift to renewable energy

• increasing interest in circular economy considerations and waste reduction (OECD, 2019[16]).

Responding to these drivers, governments from resource-producing countries are attempting to improve the environmental performance of the mining sector through a range of different policy and regulation.

This is a vitally important topic for the EECCA region, a vast geographic area with a diverse range of countries within it. Although mining varies in economic importance in the different countries, the sector plays a role in almost all of them. Exports are only one measure of economic value. They do not reflect associated employment and taxes, or related industries, such as equipment production. Belarus, while lacking the resource-oriented economy of Kazakhstan, is a key manufacturer of mining equipment. How the region addresses sustainability in the mining sector will be an important factor for both supporting economic development and improving environmental performance.

1.4. Mining in the EECCA region: Centrality, challenges and opportunities

The mining sector plays an important role in most EECCA countries, contributing to export earnings, employment and economic growth. This is evident across a range of indicators. The International Council of Mines and Metals1 measures the significance of the mining sector’s contribution to national economies through the 2016 Mining Contribution Index.2 The index showed three EECCA countries (Uzbekistan, Kyrgyzstan and Tajikistan) ranked among the top ten globally. Two others (Ukraine and Armenia) were in the top 20. In 2015, in the Kyrgyz Republic, Uzbekistan, and Armenia mineral rents constituted 7.5%, 4.6% and 3.2% of gross domestic product (GDP), respectively. In the same year, ores and metal exports contributed 44.4%, 15.6% and 12% of total merchandise exports in Armenia, Georgia and Kazakhstan.

The following rankings illustrate the importance of mining to the region. Kazakhstan is the largest producer of uranium, the second largest producer of chromium and a significant producer of many other metals. Belarus is the third largest exporter of potash. Armenia was the sixth largest world exporter of molybdenum in 2015. Tajikistan is the second largest producer of antimony and the third largest producer of mercury. Uzbekistan is a globally significant producer in many mining products, including gold, rhenium, titanium, kaolin and others. Ukraine is a top producer of gallium, rutile, titanium and iron ore, among other minerals. Even Azerbaijan, whose exports are dominated by crude oil and natural gas, produces a range of minerals and metals. These include aluminium, iron ore, steel, bromine and iodine. Finally, Turkmenistan is a leading producer of bromine and iodine (United States Geological Survey 2016).

Many EECCA countries also produce coal, both from open pit and underground mines. Kazakhstan is a coal exporter, while other countries such as Georgia produce it for domestic consumption. All EECCA countries also quarry building materials, which have some environmental impacts, though relatively smaller than most metals extraction.

Countries in the EECCA region are often divided into two groupings. On the one side are the resource-rich countries (Azerbaijan, Kazakhstan, Turkmenistan, Ukraine and Uzbekistan). On the other are those with lesser natural endowments (Armenia, Belarus, Georgia, Kyrgyz Republic, Moldova and Tajikistan). However, as Table 1.1 illustrates, minerals and metals still play an important economic role even in countries not traditionally considered resource-rich.

Table 1.1. Key export minerals and metals in EECCA countries
Country	Selected minerals and metals (as percentage of national exports)
Armenia	Copper ore (20), copper (4), ferroalloys (3.9), molybdenum (0.4)
Azerbaijan	Gold (0.6), aluminium (0.5)
Belarus	Potassic fertiliser (10), iron and steel (2.9)
Georgia	Copper ore (9.3), ferroalloys (7.3), gold (4.4)
Kazakhstan	Copper (6.2), uranium (5.1), ferroalloys (3.4), zinc (1.5), chromium ore (0.35)
Kyrgyz Republic	Gold (42)
Moldova	Gypsum and aggregates (0.3)
Tajikistan	Aluminium (30), gold (17), lead ore (6.7), zinc ore (6.6)
Turkmenistan	Sulphur (1)
Ukraine	Iron and steel (21.2), iron ore (5.5)
Uzbekistan	Gold (32), copper (9)
Source: UN Comtrade, Observatory of Economic Complexity, author’s own calculations.

As shown in Figures 1.2 and 1.3, mining accounts for an important share of GDP. Moreover, products from the mining sector still make up substantial portions of most EECCA country exports. Strong growth in the People’s Republic of China and other emerging economies from 2000-12 drove increased demand for almost all minerals and metals. Even while minerals and metals as a share of exports have remained relatively steady (Figure 1.1), increased commodity prices ensured that its importance to government revenue grew (Figure 1.2).

Beyond its contributions to export earnings and government revenue, the mining sector is also an important source of employment in many EECCA countries. In Kazakhstan, the mining and quarrying sector employees 277 000 people, amounting to approximately 3% of total employment (KAZ Stat, 2019[17]). In the Kyrgyz Republic, the Kumtor Mine is the largest private employer in the country, as well as the largest private sector purchaser of goods and services (Centerra Gold, 2019[18]). In 2014, Armenia’s mining sector accounted for 10% of total industrial employment (World Bank, 2016[19]). Mining is not always a significant employer on the national scale, but mines are often in rural and remote areas in which they are regionally important employers.

Direct employment from mines only captures one dimension of the overall impact. Other factors comprise royalty and tax revenue, goods and services purchased locally, development of related industries and horizontal linkages such as power and transportation infrastructure. In some cases, mines also support forward linkages to downstream industries.

Figure 1.2. Ores and metals as share merchandise exports for EECCA countries (1997-2017)

Note: (1) Uzbekistan and Tajikistan were not included due to insufficient data; (2) merchandise exports refers to exports of goods only (excludes services); (3) ores and metals comprise the commodities in Standard International Trade Classification sections 27 (crude fertiliser, minerals), 28 (metalliferous ores, scrap) and 68 (non-ferrous metals).

Source: World Bank Development Indicators database.

Figure 1.3. Mineral rents as percentage of GDP for selected EECCA countries (1996-2015)

Note: (1) Belarus, Moldova and Turkmenistan were not included due to insufficient data; (2) mineral rents are the difference between the value of production for a stock of minerals at world prices and their total costs of production. Minerals included in the calculation are tin, gold, lead, zinc, iron, copper, nickel, silver, bauxite and phosphate.

Source: World Bank Development Indicators database.

Almost all EECCA countries have unexploited resources. They have not been tapped for various reasons, including unfavourable investment environments, insufficient exploration data, and poor electricity and transportation infrastructure. Governments in the region have expressed interest in supporting new mining development. For example, in Kazakhstan, the government has developed a new mining code that draws on the experiences of Australia and other OECD member countries (Deloitte, 2018[20]). It has also been working to attract new investment (supported by the OECD, through the OECD-Kazakhstan Working Group on Mining Competitiveness). Tajikistan’s government has pledged to support the development of its minerals sector through a better permitting process, and the establishment of a Geological Information Centre (US International Trade Administration 2015). Armenia has seen strong growth in its mining sector in recent years; it joined the Extractive Industries Transparency Initiative in 2017.

At the same time, the legacy of Soviet-era mining continues to pose a challenge, with ageing mining facilities and equipment that is inefficient and environmentally polluting. Mining waste and tailings facilities are not constructed to modern standards. Furthermore, many sites are abandoned and unmonitored, posing an ongoing environmental risk. One challenge of moving forward with the environmental performance of the mining sector in EECCA will be addressing this legacy.

1.5. Building on the foundations of ongoing OECD and GREEN Action Taskforce work

Against this backdrop of diverse drivers, countries in the EECCA region are attempting to shift towards greener economic growth, while also maintaining the extractive sector as an engine for jobs and revenue. This is true for resource giants like Kazakhstan and also for smaller countries like Armenia that export minerals as a key source of revenue. But it is equally true for countries like Tajikistan that have substantial resource potential but lack the necessary conditions or frameworks to encourage significant new mine development.

Countries in the EECCA region are faced with the ongoing legacy of environmentally damaging mining practices from the Soviet-era. They must also develop a modern approach to mining that can minimise environmental and health impacts, while maximising social and economic benefits. At the same time, many countries are eager for investment, and for the potential influx of both revenue and technology that new mining developments may bring.

The avenues to improve environmental performance in the mining sector are well documented, but considerably more complex to implement. Mining companies need to use processes that monitor and control pollution effectively. They need to invest in processes and equipment that improve input efficiency and reduce emissions. And they need to ensure the rehabilitation of environmental damage incurred during the mining process. The question is less about what to do, than how companies can get there and how governments can encourage it.

As part of a broader project on green growth and the mining sector, the report aims both to motivate and inform governments in the EECCA region, as well as companies operating there. Today, trends and new directions in the sector reveal a strong push for going green. This is motivated by the need to reduce the negative impact of mining on the environment and local communities. But companies are also increasingly going green to remain competitive in a fast-changing sector.

The report aims to help policy makers in EECCA reconcile environmental and competitiveness objectives in the mining sector. An in-depth review of environmental impacts and trends in the mining sector complements international knowledge and efforts to provide new evidence and best practices from leading mining jurisdictions.

This project has been developed in the context of the OECD’s ongoing work on the mining sector, including the intersections of mining, economic growth and diversification with the environment.

• The OECD’s mining competitiveness project in Kazakhstan, with a first phase that ran from 2014-18, included work on how environmental payments in the mineral sector could improve environmental performance.3

• The OECD through the GREEN Action Taskforce is building on this initiative. It has launched a project on reforming environmental payments in Kazakhstan generally, supporting the development of a new environmental code.

• The OECD Policy Dialogue on Natural Resource-based Development brings together governments from resource-producing economies, major extractive enterprises and civil society organisations. Together, they discuss solutions to issues around extractive-driven economic development. Environmental issues are increasingly a component of this dialogue, including recent work on the role of renewable energy in the extractive sector.4

• The OECD’s work on mining regions held its first meeting in Chile in 2017 and second in Australia in 2018. It focuses on economic diversification and improved regional development outcomes in mining-intensive regions. It involves sub-national and national governments, as well as the private sector and civil society.5

1.6. Ongoing work at the international level is driving forward the discussion

At the international level, a number of the Agenda 2030 Sustainable Development Goals (SDGs) are relevant. More specifically, a number of increasingly widely adopted international conventions positively shape the mining sector towards better environmental performance. These conventions, to which many EECCA member countries are parties, provide tools, norms and approaches that countries can already adopt. They also help establish international standards, and provide frameworks to work through transboundary environmental issues arising from mining.

1.6.1. The Sustainable Development Goals and Agenda 2030

The SDGs, adopted at the United Nations as part of the 2030 Agenda for Sustainable Development in 2015, are relevant to mining across a number of different areas. This provides a framework for contextualising the need to improve the mining sector’s overall environmental performance.

• SDG 6 relates to water pollution and the release of hazardous chemicals, the treatment of wastewater and efficiency of water use.

• SDG 8 promotes inclusive and sustainable economic growth and employment.

• SDG 9 promotes the safe management of industrial installations to make them sustainable.

• SDG 12 encourages the shift to more sustainable consumption and production patterns, structured over eight targets. This includes the use of natural resources and the integration of sustainable practices into production processes.

• SDG 13 requires that countries and the international community take urgent action to strengthen resilience and combat climate change and its impact.

• SDG 14 (Life below water) and 15 (Life on land) are connected to mining’s impact on biodiversity.

• SDG 16 ensures participatory decision making by involving the public in discussions related to the siting and prevention of, and preparedness for, hazardous activities.

This is against the backdrop of international agreements, conventions and frameworks that can help countries improve environmental performance in the mining sector, while also standardising approaches. This, in turn, helps discourage a “race to the bottom” in which mining jurisdictions compete for investment by lowering standards.

1.6.2. United Nations Framework Classification

The United Nations Framework Classification (UNFC) provides a unified way to sustainably manage mineral resources, as well as oil, gas, uranium, different forms of renewable energy and anthropogenic resources (recycling). Vitally, anthropogenic resources focus on secondary resource use and recovery from mining wastes, tailings and other already processed materials. The UNFC provides a triple axel accounting system of socio-economic viability (including environmental impact), project feasibility and geological knowledge level. Though not focused exclusively on environmental impacts of mining, it provides governments with a holistic means to track projects and reserves through an internationally comparable system (UNECE, 2018[21]).

1.6.3. The Aarhus Convention

The UNECE Aarhus Convention on Access to Information, Public Participation in Decision Making and Access to Justice in Environmental Matters entered into force on 30 October 2001. National parties to the Convention are required to make the necessary provisions at the federal, sub-national and local levels to ensure the public (both individuals and organisations) has the following:

• access to environmental information held by public authorities, both through specific requests for information with a maximum of one month following a request, as well as through the active dissemination on the part of public authorities

• the right to participate in environmental decision making on projects that are relevant to them, including plans, proposals and projects that are likely to directly or indirectly impact the environment

• access to justice so that environmentally damaging actions can be challenged in court, and so that the justice system can be used as a means to enforce the first two rights listed.

Most countries in the EECCA region are either full signatories or are party to the Convention, with the exception of Uzbekistan (United Nations, 2018[22]), (UNECE, 1998[23]).

1.6.4. The Minamata Convention

The Minamata Convention on Mercury, which was signed in 2013 and entered into force in 2017, aims to improve environmental protection from mercury. Mercury occurs naturally, but various industrial processes including small-scale mining and mineral processing can release significant concentrations into the environment. These large concentrations have major ecosystem and human health impacts. The Convention bans new mercury mines, and also addresses site remediation for areas contaminated with mercury. It has 128 signatories, but does not include any of the five Central Asian countries from EECCA (UNEP, 2018[24]).

1.6.5. The Espoo Convention

The Espoo Convention on Environmental Impact Assessment in a Transboundary Context entered into force in 1991. It obliges its signatories to conduct joint environmental impact assessments (EIAs) for projects with the potential for transboundary environmental impacts. It counts Ukraine, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan and Armenia among its signatories. It has already been used as a framework for action in the region. In 2013-14, the UNECE Secretariat to the Espoo Convention supported Ukraine and Belarus in a post-project analysis of an EIA for the Hotislavskoe project in Belarus. The chalk deposits, located 250 metres from the border with Ukraine, led to the establishment of a bilateral working group to implement a joint monitoring programme. In another example, Kazakhstan and Kyrgyzstan conducted a pilot EIA in 2007. This process was supported by the Organization for Security and Co-operation in Europe under the auspices of the Espoo Convention and in co-operation with non-governmental organisations, industry and the appropriate national government bodies in Kazakhstan and Kyrgyzstan (OSCE, 2009[25]).

1.6.6. Convention on the Transboundary Effects of Industrial Accidents

The Convention, originally adopted in 1992, came into force for 26 UNECE members and the European Union in 2000. It has now risen to encompass 41 parties, including Armenia, Azerbaijan, Belarus, the Republic of Moldova and Kazakhstan. The Convention aims to reduce the frequency of industrial accidents, including those at tailings management facilities (TMFs). If accidents do happen, the Convention aims to lower their severity and mitigate their effects, protecting both human health and the environment (UNECE, 2016[26]). It includes both mining and mining waste. UNECE has two pilot projects to strengthen the safety of mining operations, particularly TMFs. The pilots run in Kazakhstan (2018-19), as well as in Tajikistan and the broader Central Asia region (2019-20). Sponsored by the Swiss Federal Office for the Environment, the projects draw on UNECE’s experience in improving tailing and mine waste facilities. This experience includes two previous projects focused on Ukraine, as well as UNECE’s Joint Expert Group on Water and Industrial Accidents (UNECE, 2017[27]). This group brings together industrial safety and water experts on an ad-hoc basis to support development and implementation of new guidelines that bridge disciplinary silos, in particular in EECCA and South East Europe.

1.6.7. UNECE’s Environmental Policy Reviews

Within the region, the UNECE’s series of Environmental Policy Reviews (EPRs) have regularly featured chapters on the mineral sector. They recommend how to improve environmental performance at every stage of the development process (from exploration to site reclamation and mine waste management). Lessons from UNECE EPRs are incorporated into this report. A recent EPR on Belarus, for example, looks at mining waste and extractive sector taxation (UNECE, 2016[28]). One on Georgia includes pollution flows from mining, damage to soil in mining regions, water contamination and mine waste among other topics (UNECE, 2016[29]).

References

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[18] Centerra Gold (2019), Procurement and Logistics, https://www.kumtor.kg/en/procurement_logistics/.

[14] David Suzuki Foundation (2009), Climate Change and Canadian Mining: Opportunities for Adaptation, David Suzuki Foundation, Vancouver.

[20] Deloitte (2018), What’s New in Subsoil Use and Regulation: Subsoil and Subsoil Use Code, Deloitte Legal, New York, https://www2.deloitte.com/content/dam/Deloitte/kz/Documents/legal/LegalAlert/180417_Newsletter_Code%20On%20the%20Subsoil%20and%20Subsoil%20Use_ENG.PDF.

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[2] Johnson, D. and K. Hallberg (2005), “Acid mine drainage remediation options: A review”, Science of The Total Environment, Vol. 338/1-2, pp. 3-14, https://doi.org/10.1016/j.scitotenv.2004.09.002.

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[3] OECD (2015), “Addendum No. 2”, OECD Guiding Principles for Chemical Accident Prevention, Preparedness and Response (2nd ed.) to Address Natural Hazards Triggering Technological Accidents (Natechs), OECD, Paris, http://www.oecd.org/officialdocuments/publicdisplaydocumentpdf/?cote=env/jm/mono(2015)1&doclanguage=en.

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[21] UNECE (2018), “About UNFC and Sustainable Resource Management”, webpage, United Nations Economic Commission for Europe, Geneva, https://www.unece.org/energywelcome/areas-of-work/unfc-and-resource-management/about-unfc-and-sustainable-resource-management.html.

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Notes

← 1. The International Council on Mines and Minerals counts the world’s largest mining companies and associations among its 23 members.

← 2. The Mining Contribution Index (MCI) is included in the publication the Role of Mining in National Economies. The MCI is scored based on a composite of four different indicators: the total contribution of mining to export earnings, the change in export earnings in the preceding five years, the value of mineral production as a percentage of gross domestic product (GDP) and mineral rents as a percentage of GDP. Available at: www.icmm.com/website/publications/pdfs/society-and-the-economy/161026_icmm_romine-supplement_third-edition.pdf.

← 3. http://www.oecd.org/env/outreach/sustainablemininginkazakhstan.htm

← 4. http://www.oecd.org/dev/natural-resources.htm

← 5. www.oecd.org/cfe/regional-policy/mining-regions.htm.

1. Mining, sustainability and the EECCA region