sa nuclear fuel cycle royal commission mr kevin...

SA NUCLEAR FUEL CYCLE ROYAL COMMISSION MR KEVIN SCARCE, Presiding Commissioner MR KRIS HANDSHIN, Counsel Assisting SPEAKERS: DR ANDREA MARSLAND-SMITH, Heathgate Resources Pty Ltd MR KEITH BALDRY, MR DANIEL BELLIFEMINE and MS GABRIELLE WIGLEY, Environmental Protection Authority MS JACQUI McGILL, BHP Billiton Ltd TRANSCRIPT OF PROCEEDINGS ADELAIDE 9.29 AM, WEDNESDAY, 14 OCTOBER 2015 DAY ELEVEN PROCEEDINGS RECORDED BY SPARK AND CANNON

COMMISSIONER: Good morning and welcome to the Nuclear Fuel Cycle Royal Commission, topic 7, Expansion of Exploration and Mining. Today we will hear from Heathgate Resources, the Environmental Protection Agency, BHP Billiton. There also has been a change on the front bench. Mr Jacobi, counsel assisting is on planned leave for the birth of his second child and I 5 welcome Mr Christopher Handshin. Christopher. MR HANDSHIN: Thank you. South Australia currently hosts significant uranium mining operations and is thought to contain around 25 per cent of the world’s known uranium deposits. The commission’s terms of reference require 10 an examination of the potential for an increase in exploratory mining activities, extraction and milling processes from a regulatory economic and environmental perspective. As part of earlier public sessions, the commission has heard that some geological studies and surveys suggest that there may be significant and as yet undisturbed resources in areas of the state which have not 15 yet been subjected to any comprehensive exploration. The question for the commission is whether it is feasible for industry participants to explore these sites and in the event that proved deposits of economically recoverable radioactive mineral resources were located, develop new operations or expand existing ones to mine these sites. 20 Following on from evidence received at previous public sessions, the degree to which industry participants, government and research organisations can potentially collaborate to facilitate and promote efficient exploration and mining activities ought be considered and the commission intends to explore 25 this issue in a later public session as part of topic seven in mid-November. The focus of today’s evidence will be on the status of uranium mining in South Australia today. In recent years there have been significant developments at some of Australia’s most substantial mining operations at Olympic Dam and Beverley. At Olympic Dam, BHP Billiton’s approval to expand its operations 30 to include open pit mining has not yet been acted on and there has been a reduction in the tonnage of produced uranium oxide over the last two financial years. Beverley and its satellite mines have been put in to a care and maintenance mode by operator Heathgate Resources and attention diverted to the Four Mile Mine operated by its affiliate Quasar Resources. 35 The circumstances both local and international which have brought about these events need to be identified so that there can be informed discussion and analysis of the prospects of expanding existing mining operations or establishing new operations. These topics raise multidimensional questions, 40 including the potential local and broader community benefits and detriments of increasing exploration and extraction activities, the economic incentives and barriers to doing so and the potential environmental impacts. The relevant characteristics of current mining techniques, including open cut, underground explosive, in situ leaching and heat leaching and their respective benefits and 45

.SA Nuclear 14.10.15 P-606 Spark and Cannon

disadvantages, including waste streams and their management must also form part of the commission’s inquiry. At previous public sessions held at Port Pirie, the commission heard evidence concerning the environmental impacts of historical radioactive mineral mining and processing practices and the lessons that have been learned from that past. Today’s public session will 5 explore more recent environmental management practices within the mining industry with a view to understanding the currently accepted methods for assessing, addressing and monitoring the impacts of uranium mining within the state. 10 This morning’s first witness will be Dr Andrea Marsland-Smith of Heathgate Resources Pty Ltd. Heathgate Resources owns and operates the Beverley and Beverley North uranium mines which are located approximately 520 kilometres north of Adelaide in South Australia. Beverley which commenced production in late 2000 is Australia’s first commercial in situ recovery mine. 15 Uranium mining activities at both Beverley and Beverley North were suspended in early 2014 and the mines are currently in standby. Dr Andrea Marsland-Smith is a geologist with 23 years minerals industry experience with both Australian and international companies. The last 13 years of her career have been focussed in the uranium exploration and mining sector 20 and she has held a variety of senior geological and management roles. In 2008 she was awarded the AMEC prospector of the year for the discovery of the Four Mile Uranium deposit. Currently she is the manager of regulatory and compliance and directs Heathgate Resources state and federal government relations and regulatory approvals. 25 COMMISSIONER: Dr Andrea Marsland-Smith, welcome. We have heard that Heathgate has considerable experience since 2000 with in situ recovery mining. And the areas that we would like to start and explore initially will be in situ mining and exploration which are quite clearly linked to our terms of 30 reference. So perhaps to start, in the broader sense, can we understand the method of in situ mining and the aquifers, the work that you do to characterise the geology and broadly work us through the process of in situ mines. DR MARSLAND-SMITH: Sure. So first of all, going to first principles we 35 need to undertake the exploration process for an in situ recovery amenable deposit. Those requirements prescribe that the ore body is hosted in a permeable sandstone and is under the water table. Because it’s that groundwater that we use as our mining solution. So once that resource is discovered, we delineate the resource to some detail, to know where our high 40 grade areas are versus – leachable versus non-leachable areas and I will just go to slide four – slide five, which shows you what these deposits look like under the ground. So ISR leachable resources are not commonly referred to as roll fronts and this is what they look like under the ground. Up at Beverley and Four Mile and Beverley North, our roll fronts are between 120 metres and 45


280 odd metres below the ground. You will see they are like U-shaped or C-shaped ore body morphologies. How they form is we have the Flinders Ranges next to the Frame Basin which is a package of sedimentary layers and the northern Flinders Range is very enriched in uranium as we all know, particularly in the northern Flinders Ranges area. So what happens is the 5 rainfall percolates through the Flinders Ranges, picks up the uranium from those hard rocks, like the granites where the uranium is hosted and at neutral pHs almost like rainwater pH, leaches that uranium because uranium is very mobile. Picks it up and pushes it out in to the sedimentary basin and when that groundwater carrying that uranium reaches a reduction zone, meaning an area 10 that is enriched in carbonaceous matter, like leaf litter or where you might have some pyrite in the formation, that uranium reduces which means it comes out of solution and drops out in to that sandstone. This happens over time, so a million years this process happens time and time 15 again which is why you get to see this ore body morphology that looks like the front of a wave basically. Where the most rich part of the ore body lies is in what is called that redox front roll nose area. And that is the area that we target in our mining process because it’s at the front of that roll. It is the most easily extractable part, whereas at the back of that C-shape the upper limbs and lower 20 limbs, whilst there’s still uranium in those, they’re caught in clay, so they don’t mobilise as quickly. So we have what is called a roll front with limbs and a roll, or a nose area. So once we define where our roll and a nose is and where the limbs are, then we start looking at, well are there multiple stack rolls because these can occur in five to six different layers, as you imagine, just with 25 a wave that you see at the beach with the froth at the front of that wave. So we use drilling primarily and down hole, bore hole logging. So we send probes down our drill holes to measure the gamma radioactivity and the grade of the uranium down hole and some other things like porosity, where the water table is, so we understand exactly where that is. And then we progress to installing a 30 well field. So our well field comprises of water wells, as you would imagine because we are going to use the groundwater in that system to circulate through to our plant. So we install wells. If you just go up to the next slide. Yes. This is a 35 picture of the process, and you'll see in the picture to the top lift we have our roll-front host within our sandstone ore body. To understand how that's going to leach, we undertake several studies understanding the porosity. We do pump testing in the field to understand flow paths; groundwater gradients; where the regional groundwater flow is going to go; what is the groundwater 40 quality like, so we have to understand exactly what the baseline groundwater characteristics are; and how is this ore body confined, is it confined by clay layers, is it not. So in the Frome basin we have our ore bodies currently confined by 45


impermeable clay layers above and below the ore body, and then we then progress to the wellfield design stage. So the wellfield design stage is when we look at the shape of that roll-front and design the wells to fit exactly over that roll and nose area that I was talking about previously. And so in the top right-hand corner you'll see a picture that just shows as an aerial photograph of 5 what a wellfield actually looks like, and you'll see a number of points with lateral pipelines heading out to them. They are all the wells that we install over a wellfield. Those wells are spaced normally 30 metres apart, but again, it depends on the width of that roll-front. 10 The two pictures to the left there show you how the flow paths of these well configurations occur. So you can choose to have five spot patters where we have an extractor in the middle and we have our injectors, which is going to use as putting the mine solution into the ground, around the outside. So those configurations are set specifically to maintain the fluid flow in the vicinity of 15 the wellfield. Once you start having asymmetric configurations then you have to do some more modelling around how is your fluid flow going to look underground once you start circulating. So all of that is done by very high level, hydrological modelling and flow modelling with input parameters such as the porosity, what we know about the groundwater gradient, the pressures at 20 which we're going to flow the wells at, et cetera. So once we've established our wellfield then we connect our pipes up to a plant. If you just go to the other slide. Yes. So you'll see particularly in Heathgate's operations we have three plants in the area. We have two satellite 25 plants up in the Beverley north area, Pepagoona and Pannikin. We have the Beverley plant down in the centre of the slide. The wellfields at Four Mile, for example, are just wellfields and they are plumbed up to the Pannikin satellite plant where the fluid goes to and gets part processed and then that part-process fluid is trucked then to Beverley for the back end part of the process which is 30 drying and packing. When we operated Beverley our wellfields were right next to that Beverley plant. So we plumbed those wellfields straight into Beverley and that took care of the whole process. If you go back to that other slide then, Lucinda. Thanks. So going back to the 35 left-hand slide showing that cross section of the process, you see we have an injection well and a recovery well or an extraction well, and as I said, we have a multiple array of these. So once the wellfield is plumbed up to the plant and the whole system is closed in terms of the pipework, we start circulating the groundwater that exists within that mineralised zone. So the groundwater 40 comes out via the recovery well and goes to the satellite plant and that's when we condition that groundwater to lower the pH and we also add an oxidant to that fluid. It comes back from that plant into the injection well, as you see in that slide, all 45


again pumped using submersible pumps down these water wells. So that's what we use to push the fluid around, and they're all controlled by a control room. The pressures are constantly monitored, the flow rates are constantly monitored, to ensure that each injection well is communicating directly to that extraction well. And then as that conditioned groundwater moves through the 5 formation, through that ore body, it's pulled towards the recovery well, pulled out, and that uranium is then in solution which goes back to the satellite plant and through then the recovery process. The recovery process comprises of an iron exchange process where the fluid is 10 put through a number of iron exchange columns which you can see in the picture, those three columns that you see. So it's basically like a water softener and the water softener contains these resin beads which you see in the picture next to it. Those resin beads essentially absorb the uranium out of the fluid onto it. So the uranium sticks to those resin beads and then that that resin bead 15 slurry can then be transported anywhere you need to get it transported for back in processing. So with our process, we truck it back through our resin trucks back to Beverley, which you can see then in that bottom area for all that back end drying, thickening and packing process. So that essentially is the process. Yes. 20 COMMISSIONER: We might unpack some of that now, Mr Handshin. DR MARSLAND-SMITH: Yes. 25 MR HANDSHIN: You made reference, Dr Marsland-Smith, to drilling and probing activities as part of the stage of identifying the nature of a deposit that you're working with. I just want to go back to a step before that and get you to explain some of the general techniques that are used in the initial exploration processes. 30 DR MARSLAND-SMITH: Yes. So it's very important to understand the regional geology, and so the way that we have approached that methodology is using all of the available data to us, and that includes publicly available geophysical data such as magnetic surveys, gravity surveys, electromagnetic 35 surveys, all to try to characterise where our host rock occurs and how is it in relation to impermeable layers. Heathgate specifically has undertaken very high-resolution seismic surveying to get a very detailed pictured of the basin, and that was the first of its kind done for this type of deposit in the world, I think, about three or four years ago, so that was leading into the Four Mile 40 permitting. So we have a very good regional picture of the geology is looking like. From there, we obviously drill a lot. So we've drilled in excess of 14,000 holes in this area, and use borehole logging to characterise and detail the geology 45


down every single hole. The resolution of data is 2 centimetres. So you imagine over a 300 metre hole we have 2-centimetre resolution of the geology down the hole. So we very accurately understand where there may be small clay layers that may divert flow. So we understand that ahead of time before we start flowing through wells. From there, we also take core samples and 5 understand the mineralogy of the uranium before we look at what type pH we need to lower the groundwater at, et cetera, how much oxidant we need to put in. So the mineralogy of the uranium and how that uranium is in relation to other minerals in the ore body has an effect on those forecasts. 10 MR HANDSHIN: In what way? DR MARSLAND-SMITH: So if you have more reductant in the formation there may be a requirement to use more oxidant in the dosing stage, because the reductants, or the organic matter, competes for reagents along with 15 uranium. So the organic matter will utilise all of the reagents in the groundwater before the uranium is liberated. So you need to understand that before you start your operation, yes. MR HANDSHIN: But some of the data that you’ve referred to that’s 20 deployed in this exploration stage of the process is that generally available data or is that data that’s been collated by Heathgate as part of its commercial operations? DR MARSLAND-SMITH: Yes, we’ve spent the last 15 years, we’ve 25 deployed almost every single geophysical method to try to understand is there one single geophysical method that can map our deposits and the answer is no, but the answer to the question is it’s a combination of all of those data sets combined, so it’s almost like data mining and not one piece of data is going to lead you to the answer, but if you look at it holistically and use innovation in 30 looking at how you can integrate that data and we use organisations such as CSIRO, we collaborate with universities to innovate in that area to try to see if we can have a method that can remotely detect where these deposits are. MR HANDSHIN: Yes. What kind of collaboration are you talking about, 35 what’s involved? DR MARSLAND-SMITH: Yes. Again we’ve got a 15 year database of every geophysical method known to man undertaken and - - - 40 MR HANDSHIN: In this particular area? DR MARSLAND-SMITH: In this particular, yes, and we also have a very big database of drilling data which calibrates all of this data, so we understand if there’s an anomaly in the electromagnetics, an electromagnetic high, which 45


may indicate a saline part of groundwater we can then drill that and test that to see if that’s a channel or a sand that’s hosting some water which may be a target, so with CSIRO for example they recently published a study over Honeymoon mine where they reconstructed the paleo-hydrogeology, which is the historical – how the landscape looked back 30 million years ago because 5 how it looks today was not how it was then and so in understanding what the regional groundwater flow was back then will help us target where we need to drill in the future years and so they have some proprietary software that helps us - we use our data and we co-operate in ways like that. 10 MR HANDSHIN: It’s clear that having access to high quality data is essential to the process. DR MARSLAND-SMITH: Yes. 15 MR HANDSHIN: Are there currently programs such as the UNCOVER program that are designed to make this kind of information more accessible to prospective operations? DR MARSLAND-SMITH: I think it’s also about when you are doing an 20 investigation making every single drill hole work for you, so the UNCOVER program does that in terms of if you’re putting a probe down the hole you need to measure four things, not one thing because it’s a waste of money and time if you have to redrill that hole again to measure another parameter, so I know that that’s where the value of those programs lie. 25 MR HANDSHIN: Is Heathgate involved in the UNCOVER program in any way? DR MARSLAND-SMITH: We were in the initial stages in the borehole 30 logging field, but we have our own R and D arm as you’d appreciate, so whilst we participate in those programs we also run our own. MR HANDSHIN: Is access to high quality information in your view one of the barriers to further exploration in the state? 35 DR MARSLAND-SMITH: Yes. MR HANDSHIN: What can be done to improve both access to and the quality of the information that’s currently available? 40 DR MARSLAND-SMITH: What can be done to improve it? It’s really when companies gather information maybe reducing the time for which that becomes publically available is probably one area that there’s an opportunity to look at and particularly in areas where companies have held tenements for quite some 45


time, beyond the standard five year period would be my response to that. MR HANDSHIN: What issues does long term proprietary rights over tenements create? 5 DR MARSLAND-SMITH: Those tenements are probably held for not just uranium exploration, so they’d be multi-commodity tenements. People who were interested in just uranium can’t get access to that ground. Similar to the petroleum industry. They can take tenements over the top of a mineral tenement, so they can co-exist. I think the uranium tenement or the tenement 10 system for uranium could adopt a similar system than what we have for petroleum and geothermal leases, so a system where we can unlock some more ground for the purpose of uranium exploration. MR HANDSHIN: One of the other matters that you’ve raised is perhaps the 15 more practical side of things namely the drilling. DR MARSLAND-SMITH: Yes. MR HANDSHIN: Is that a capital intensive component of the exploration 20 process? DR MARSLAND-SMITH: Yes, it is. On average each delineated hole will cost around 15 to 20 thousand dollars, so we have a basin of 5800 square kilometres, a drill hole is this wide, so to try to pinpoint a roll-front of that size 25 that I showed you earlier is quite a challenge, but without that drilling you can’t get information about the geochemistry of the formation and, Lucinda, if you just go to that roll-front map you’ll see that in relation to a roll-front there’s the sand that is around, you’ll see some darker areas and some lighter areas and it’s that change in character of the sand that we look for in our 30 exploration, so when we hit an oxidised part of the sandstone we know there’s a cell that’s come through here somewhere and so where is our roll-front, where’s the front, so drilling is the only method that delineates that in the field. MR HANDSHIN: Are you familiar with the PACE program? 35 DR MARSLAND-SMITH: Yes. MR HANDSHIN: How do you see that as incentivising further drilling activities? 40 DR MARSLAND-SMITH: It certainly helps junior companies get out there on the ground and look at new areas that may be perspective for roll-fronts, so instead of having to find foreign investment it helps them get on the ground to do some preliminary work and it doesn’t take too long if you have a 45


Robustel program to understand what we call the redox state of the sands are, which is this system, it doesn’t take long to determine that. COMMISSIONER: Can I just go to the slide where you’ve got the four mines? 5 DR MARSLAND-SMITH: Yes. COMMISSIONER: Can you explain the current state for those mines? 10 DR MARSLAND-SMITH: Yes. Beverley commenced production in 2000 and ceased production in around December 2013, having produced approximately 16 million pounds of uranium during its lifetime. The average production rate for Beverley was around seven to eight hundred tonnes per year on average. In August 2008 seeing that the resource at Beverley was limited, 15 and you can see we did some exploration to the south and to the east of Beverley, found some small deposits, but they were not in very permeable sands and they were more difficult to extract. Nonetheless we put wellfields over those areas and they are still there for another day to redress if the uranium price goes north of $70 a pound. 20 COMMISSIONER: It’s currently at 40, isn’t it? DR MARSLAND-SMITH: It’s about 35. 25 COMMISSIONER: 35. DR MARSLAND-SMITH: Yes. Seeing that future for Beverley the company then started looking at other exploration programs in the area, so Heathgate has been exploring since 2002 and in 2005 the Four Mile deposit was discovered 30 and that’s particularly the Four Mile east and west deposits and then, just as a matter of course, in our normal exploration programs we found Pepagoona and the Pannikin deposits which lies in and around those Pepagoona and Pannikin satellite plant areas, on the Heathgate side of the boundary. You will see that Four Mile northeast ore body, that’s just recently been discovered so it wasn’t 35 known that all the deposits were connected at that point. So nonetheless, Beverley’s production time was coming to an end and so we refocussed our efforts up in to the Beverley north deposits, which was Pannikin and Pepagoona and we applied for extended mine lease in 2008 and we started production in 2010/11 on those areas. 40 COMMISSIONER: What do they produce per year? DR MARSLAND-SMITH: They produced only for around two to three years and produced around a million pounds each, one to 1.5 million pounds each 45


per year. So we still have some ore to the east and west of Pepagoona which transgresses the lease boundaries, as you can see in that diagram and so we are currently looking at how we mine across those lease boundaries and we are working through those approvals currently. So then Four Mile was subject to some litigation which was resolved earlier this year and then more recently 5 Quasar bought the remaining equity in that project from our joint venture partner in September. COMMISSIONER: Quasar in relation to Heathgate? 10 DR MARSLAND-SMITH: Quasar is a subsidiary of General Atomics, just like Heathgate is a subsidiary of General Atomics. Heathgate is the service provider for all its operations to Quasar. COMMISSIONER: Right. 15 DR MARSLAND-SMITH: Yes. So Four Mile then was put in to production in April in 2014 and is still in production now. That operation is essentially well fields linked up to that Pannikin satellite plant. Currently Pepagoona is off line, we are not using that plant at present but we have plans to reinstate 20 that plant in the coming year or so pending some infrastructure modifications to be able to increase our production through that area. COMMISSIONER: So it’s an issue of infrastructure not uranium cost? Uranium price, I should say. 25 DR MARSLAND-SMITH: Yes, it’s infrastructure and – well, it’s always uranium cost because we don’t want to make a loss, so it is break even or profit but because we already have a lot of capital invested in this area, it’s easier for us to put on lower cost or marginal well fields that may not be economic to put 30 in to production in a greenfields area, if you had to put in all the capital to start. MR HANDSHIN: Can you provide us with any more detail about the nature of the infrastructure developments that are being undertaken? 35 DR MARSLAND-SMITH: Yes. So it’s really about – it’s two things with ISR, it’s grade obviously and flow. So your plants are your limiting – how much you can flow is your limiter. So if your grade is dropping, you can increase your flow and maintain that same head grade. If your flow starts diminishing because your wells are not producing as well, or there is 40 constraints in your plant, then your head grade needs to compensate which is something you can’t control really. S it’s flow is the main thing that we look at. So if we want to increase production, it’s usually an increase in flow capacity which means putting in more of those IX columns, bigger pipes, the whole – at the beginning of a project, you have to assess what flow rates you 45


think you might go to and either build to that or build to what the price currently determines that you need to flow at because you’ll produce this in 12 months and then have no future. So it’s all a balancing act between flow rate and your future projections to how you want to develop the ore body. 5 MR HANDSHIN: Have you got a timeline for the completion of those developments? DR MARSLAND-SMITH: We are working through that currently. 10 MR HANDSHIN: Can I just pick up on one thing that you mentioned a moment ago, in the context of bringing operations at Beverley to suspension. DR MARSLAND-SMITH: Yes. 15 MR HANDSHIN: And you referred to the price of uranium needing to reach in the order of $70 a pound to make it commercially feasible again. Do you see any indications that the market might be trending in the right direction in that respect? 20 DR MARSLAND-SMITH: Heathgate takes a very long view and as you’ve seen, we have operated Beverley from a $7 a pound price through to current day to the heady prices back in 2006/7. So we are committed to the long term but we do have an expectation that the price will support our ongoing investment in this area and operation. 25 MR HANDSHIN: Are there any other broader economic commercial or regulatory factors for example that could influence what Heathgate did at Beverley in the short to mid-term? 30 DR MARSLAND-SMITH: It all comes back to; I think bipartisan support for uranium mining. We don’t invest in states that don’t support uranium mining because we don’t see what the need to explore, if you can’t mine that asset. So because we are producers, that is our end game, so it is highly essential for us to keep having that bipartisan support and that is the top of the tree for us to 35 continue our investment in SA. COMMISSIONER: Can I just explore, and if this is commercially sensitive you will let me know but what – do you have a production goal per year? I know it is clearly linked to the uranium price but I just want to get a sense of 40 where you are now - - - DR MARSLAND-SMITH: Yes. COMMISSIONER: - - - where you have been and subject to price, where you 45


might want to be in the future, based upon the deposits we see just here on this particular screen? DR MARSLAND-SMITH: Yes. As - - - 5 COMMISSIONER: In the broader sense. DR MARSLAND-SMITH: In the broader sense, yes. COMMISSIONER: I’m not interested to try and compromise - - - 10 DR MARSLAND-SMITH: Yes. COMMISSIONER: - - - commercial issues. 15 DR MARSLAND-SMITH: Look production is not going to go down from where we are at currently, so we currently produce around two million pounds a year with the current infrastructure. So to - - - COMMISSIONER: And that is exported? 20 DR MARSLAND-SMITH: Yes. So in order to increase that production, we have to do modification to the Beverley plant as well because Beverley initially was only rated at around a million odd pounds a year production. So there’s a number of things that we need to upgrade and we’re looking at that now and 25 working through those - - - COMMISSIONER: So goal is two million pounds a year - - - DR MARSLAND-SMITH: That is - - - 30 COMMISSIONER: - - - or around about? DR MARSLAND-SMITH: That is where we are at the present time. 35 COMMISSIONER: Right. DR MARSLAND-SMITH: So we are currently working through, as we speak, our plans for the future and there is a number of issues that we need to look at. In the Four Mile lease we have about 40 million pounds out of an inventory of 40 say around 60 to 80 million pounds. That is currently permitted for extraction. The other pounds are not; they are in a different geological formation and so they need to be looked at in terms of permitting again. So we have still got a way to go to be able to understand if we can extract all of these resources in this lease. 45


COMMISSIONER: Yes. DR MARSLAND-SMITH: Part of the Four Mile west deposit is in dry rock, so there’s no water around, so it cannot be extracted using our current concept 5 of ISR, so there is new technologies that we need to look at, if we are to extract - - - COMMISSIONER: Is that a substantial resource? 10 DR MARSLAND-SMITH: That’s about 20 million pounds, so that’s Beverley, so that would be at a million pounds a year, around 15 year’s production. So there is a number of issues to work through but currently we have around 40 million pounds to produce and at current rates, they will – if we don’t increase production, will be around a 10 years of production but again, 15 that’s all dependent on flow rate and how these wells produce because each well field is different. You cannot predict how a formation is going to flow in the end. You can have a good idea, but the proof is when you actually start flowing. 20 COMMISSIONER: Does anybody in the world at the moment currently produce this from a dry rock? I'm talking about the west deposit. I mean, are techniques available to do that? DR MARSLAND-SMITH: There are some deposits in the US, you know, that 25 you can raise the watertable locally in order to use that. There are other techniques such as borehole mining. That's a new technique, but not used. There's obviously open-cut mining. You know, so there's a lot of different things and options that we need to assess and also work with government on, you know, how the permitting of that would go. Yes. 30 COMMISSIONER: Right. Okay. So apart from uranium price, in terms of the investment environment, you're comfortable that there's not much else - I don’t want to put words in your mouth. Are there any things from a State government perspective that might be undertaken to further incentivise the 35 company to increase production or to increase exploration? DR MARSLAND-SMITH: Again, coming back to the partisan support, having a regulatory system that is supportive of different ideas in uranium milling and mining, so whilst this might be an ISR project for now, we may 40 need to transgress into some other option, so being fluid enough to consider those options. COMMISSIONER: Do we have a system, in your view, that is so characterised? 45


DR MARSLAND-SMITH: Yes. I think so, yes. You know, as with any project you have to demonstrate that you're not going to affect the environmental values outside of your mine lease should you undertake an extraction method X, Y, Z, and that's always - you know, we're committed to 5 that process. COMMISSIONER: That might be a good time for us to talk about some of the concerns that we read in submissions about in situ pollution. 10 DR MARSLAND-SMITH: Yes. COMMISSIONER: Kris? MR HANDSHIN: Can we perhaps go back to the configuration of the 15 wellfields and the use of water from obviously groundwater resources? DR MARSLAND-SMITH: Yes. MR HANDSHIN: Can you tell us a little bit about the process of groundwater 20 characterisation that you use and what it tells you about the water that's currently being used for Heathgate's activities? DR MARSLAND-SMITH: Yes. Before you start an ISR process and formulate your monitoring regime and your closure strategy you need to 25 understand what the water quality is obviously. So we use - and every other operation, Honeymoon, et cetera, does, and a lot of other mining operators - use the guidelines called The Australian New Zealand Guidelines for Fresh and Marine Water Quality. So we take extensive groundwater samples from every single water well available that we have. We even drill specific water wells for 30 understanding groundwater quality. It's not only mining aquifer that we grab samples from. We get samples from above and below the mining zone, kilometres away from the mining zone, and understand if there's a variation in the water quality. 35 So at Beverley, and all of the deposits in that Frome basin region, the water quality is classified as industrial and is of no beneficial use or environmental value in accordance with these water quality guidelines, and that is on the basis that the water has too much fluorine in it and also radon. So it's not usable for stock use. It's not usable for any other use now. So the water quality there is 40 of no beneficial use apart from mining. MR HANDSHIN: Is that the water occurring in its natural state? DR MARSLAND-SMITH: Yes. 45


MR HANDSHIN: Are the currently technologies available that would allow the manipulation of the water's composition to make it usable for other activities? 5 DR MARSLAND-SMITH: There amount of investment to change its original water quality from a non-usable quality to a usable quality would be not feasible, I don’t think. Yes. MR HANDSHIN: I just wanted to perhaps pick up on the second issue, which 10 concerns the use of a reagent solution in the recirculation process. Perhaps I should clarify that the operations at Beverley and Four Mile involve an acid leaching process. Is that right? DR MARSLAND-SMITH: Yes. 15 MR HANDSHIN: As opposed to an alkaline process? DR MARSLAND-SMITH: Yes. 20 MR HANDSHIN: Can you tell us what the acids that are used in the process are? DR MARSLAND-SMITH: Yes. So as I said, we grab the groundwater from the pore spaces within the sandstone that is in and around the uranium ore 25 body. So it's already got natural uranium in it anyway, and radionuclides and base metals. So when we circulate that to the plant for reagent addition, we use sulphuric acid, H2SO4, as the acid, and we use peroxide, H2O2, which is the oxidant. Now, all of those elements that make up those equations are already present in the groundwater. So we specifically choose H2SO4 because the 30 groundwater already contains sulphates, and that's extensively documented in our baseline water chemistry data. So we're not adding any element that's not already part of the groundwater elemental makeup and that's, you know, an important part of our process. 35 MR HANDSHIN: But a high concentration. DR MARSLAND-SMITH: It increases the concentration. So it lowers the acidity of that groundwater. 40 MR HANDSHIN: And that solution with the reagent in it is pumped through the aquifer? DR MARSLAND-SMITH: Yes. 45


MR HANDSHIN: Is that right? DR MARSLAND-SMITH: Yes. MR HANDSHIN: Does that give rise to a risk of the mining solution perhaps 5 disbursing beyond the confines of the mining aquifer, and if so, how do you guard against that risk? DR MARSLAND-SMITH: Okay. So inherent in a wellfield design is making sure that, again, what I said, those injectors are hydrologically communicating 10 with your extractor. So that's the first level of insurance, that you have connection and you're not injecting into somewhere else where you're not extracting concurrently from. We have a team of hydrogeologists on site which monitor the pressures of all of the pumps in every single well 24/7, and if you're injecting 1 litre you have to extract 1 litre to keep that wellfield 15 balanced. That is the key to keeping your fluids in and around the wellfield area. So you can imagine if you put 2 litres in and only take 1 litre you're over-pressuring and there's a risk that the plume can migrate out. If a pump goes down we rebalance the wellfields. We always - rebalancing, 20 relooking at it, remodelling and adjusting well flows to make sure our wellfields are balanced. Another thing over the top of that is as the groundwater is circulating through the aquifer and going to the plant, we take out what's called a bleed, which is maybe 1% of the total flow of that system, and that maintains a low pressure sink around the wellfield. So when we are 25 operating a wellfield we're overriding the local hydrogeological gradient. So we're actually overriding the natural groundwater flow system in that vicinity of the wellfield, and so that bleed helps us keep that - you imagine, fluids flow from a low to a high. So if we've got a low pressure sink over the wellfield due to this bleed then the fluids essentially contain in that area. 30 Around the wellfield too we have an extensive ring of monitor wells, which are again water wells. We have wells in the mining aquifer themselves around. So around 250 metres odd from the wellfield there'll be monitor wells that we grab water samples from the mining aquifer. We also have monitor wells above and 35 below the mining aquifer to ensure that we don’t see any migration of mining fluid above or below, but again we have clays above and below and that’s also what contains the solution above and below. MR HANDSHIN: Are they known as aquitards? 40 DR MARSLAND-SMITH: They are known as aquitards, yes. MR HANDSHIN: The monitoring system that you use does that enable you to regulate both lateral and vertical dispersion? 45


DR MARSLAND-SMITH: Yes, and there has been on occasion where you’ll see maybe sulphates elevate in a monitor well. It gives you that feedback to tell you that or there’s an issue and you need to pull back your fluids, so the monitor well ring, the lateral monitor well ring, is designed for that purpose 5 and, yes, you pull back your fluids, get that feedback from your monitor well. It’s not a non-compliance and it’s not a breach of your lease conditions, that’s the purpose of the lateral monitor network. COMMISSIONER: Can you just tell us what happens to the one per cent that 10 you bleed off, what happens to that water? DR MARSLAND-SMITH: Yes. COMMISSIONER: Presumably that is higher in concentration minerals than 15 the normal groundwater. DR MARSLAND-SMITH: Yes, it is a little bit, but the uranium has been taken out and along with all of our processed water that bleed water is then put into our evaporation ponds and we evaporate as much water as we can because 20 what we don’t want to do is dispose of more water than we need to, so it goes to the evaporation ponds along with our processed water, the plant wash down water. It evaporates off and what’s left in those ponds gets disposed in the old wellfields, abandoned wellfields at Beverley and then, as I said before, each litre you put in you have to take a litre out of an aquifer, so at Beverley when 25 we dispose of this residual water that we can’t evaporate into those abandoned wellfields we also take a litre out downstream out of that same aquifer, which is fresh water, to use back into our process, so it’s a continual water recycling system. 30 MR HANDSHIN: What is it about the Beverley wellfields that makes it an appropriate site for the relocation of the waste stream? DR MARSLAND-SMITH: Beverley is basically a bathtub, it’s called a paleochannel. You probably would have heard of that terminology, but it’s 35 essentially a clay bound channel filled with sand and it’s very stagnate. The groundwater movement is very, very slow. At Four Mile for example the groundwater flow is around 10 to 20 metres per year, which is very slow, but at Beverley it’s around one for example and that’s because of the stagnate nature of the system. It’s not open to any groundwater recharge, so it’s just this body 40 of water and sand that’s contained with this clay layer. The clay is very thick and so the likelihood of any excursion outside of the paleochannel is almost non-existent and so we have mined out areas at Beverley that are already affected and so we’re disposing into affected or altered state groundwaters already, so - - - 45


COMMISSIONER: I just need to go back. I see we still get rain in the Flinders so what happens to the water that washes off if you say there is no recharge? 5 DR MARSLAND-SMITH: Yes. COMMISSIONER: Can we go back to that? DR MARSLAND-SMITH: Yes. 10 COMMISSIONER: You’ve got all those ranges there, presumably the water still comes through. DR MARSLAND-SMITH: Yes. 15 COMMISSIONER: What happens to it? DR MARSLAND-SMITH: Because the Beverley channel is so confined, it’s 120 metres below the surface, so it gets minimal recharge. I suppose like 20 (indistinct) gets no recharge, but very limited. The rest gets pushed into the air formation which is below the Beverley aquifer. COMMISSIONER: How deep is that? 25 DR MARSLAND-SMITH: The air formation is around 200 and 300 metres depending on where you are in the region and how much vaulting is going on, so the air formation takes a lot of the recharge off the ranges which is why you see those deposits where they are because those deposits are a direct result of groundwater recharge, but it’s carrying uranium, so that in essence is evidence 30 that we have a lot of that recharge happening. Those deposits are still being remobilised and moved as we speak because we still have the groundwater coming through, so in a million years’ time our wellfield would have moved a kilometre down the way, down gradient. The basement underneath the basin, which is the Mount Painter fractured rock aquifer, also takes water. That 35 aquifer is over pressured with respect to the air formation and so that water comes into the fractured rock aquifer and moves its way up into the air formation, which is a very permeable extensive sandstone, and then that water goes through the air formation and discharges down into the frame basin area. 40 MR HANDSHIN: Presumably at Beverley in the location of the waste deposits you maintain some sort of monitoring program? DR MARSLAND-SMITH: Yes. 45


MR HANDSHIN: Does that carry reporting requirements with the EPA for example? DR MARSLAND-SMITH: Definitely, yes, so the whole system again is surrounded by a very extensive ring of lateral monitor wells. Also above and 5 below the Beverley aquifer is monitored and reported on a quarterly basis to the state authorities, both EPA and DSD and Department of Water and Natural Resources. That information is also reported biannually to the Federal Government. 10 MR HANDSHIN: Can I just go back very quickly to the issue of the reagent insulation? DR MARSLAND-SMITH: Yes. 15 MR HANDSHIN: Can you give us an idea of the sort of volumes of sulphuric acid and peroxide that are used in the process of leaching? DR MARSLAND-SMITH: I’m not an expert on that part, so I’d have to take that question on notice, but I can say that on average - because it just depends 20 on the size of the wellfield. If you have two wells you’d imagine you don’t need as much reagent as opposed to if you had a wellfield comprising 40 extractors and 70 injectors, would be a different story, so it’s just a case by case basis, but on average for every metre cubed that we circulate we get around 10 to 20 kilos of uranium extracted, but in terms of trucks and volumes 25 of sulphuric acid I would need to check and get back to you on that. COMMISSIONER: Lucinda, can we go back to this slide here please? Can you just walk us through what happens when the wellfield’s finished? 30 DR MARSLAND-SMITH: Yes. COMMISSIONER: What do you do? DR MARSLAND-SMITH: Yes. 35 COMMISSIONER: How do you monitor what’s happening below after you’ve completed your work? DR MARSLAND-SMITH: Yes. Once we turn off the wells the area reverts 40 back to its natural groundwater gradient status, so the groundwater will move according to that gradient, so we understand that gradient and where the water will go and the water will move very slowly as I said, about 10 to 20 metre per year. 45


COMMISSIONER: You take out all of the apparatus I presume? You wouldn’t leave it there. DR MARSLAND-SMITH: Yes, so all of that comes out. 5 COMMISSIONER: It all comes out. DR MARSLAND-SMITH: The wells are cemented up, so we absolutely isolate the aquifer off to any other aquifer in the region, so - - - 10 COMMISSIONER: When you say “cemented” is it cemented down to the aquifer itself? DR MARSLAND-SMITH: Yes. Yes, and all through that open area where the submersible pumps are, so the pumps are taken out, the wells are cemented 15 up. All the surface infrastructure is taken out and the beauty of ISR is that all of that infrastructure just lays on the ground, so you just take it away, you don’t need to dig up pipes or anything like that and then obviously you have mining plume left in the ore body, so that plume will move into, in accordance with the groundwater flow velocities, fresher rock and so to give you an idea of how far 20 the plume moves over time in about seven to 10 years the plume would have moved around 95 to a hundred metres from the wellfield through fresh rock. Over around a hundred years that plume would have moved around a kilometre. Now what happens to that water when it moves through fresh rock. It’s called a process of natural attenuation and it’s really just a word for the 25 rock wants to equilibrate that ground water back to its original status. So we have a higher acidic groundwater moving through the fresh rock, and inherent reactions that happen between the water and that fresh rock and particularly it is the clays that do the work in the fresh rock. Buffer that groundwater and bring that pH back up to neutral pHs. And so that is the process of natural 30 attenuation and all our modelling shows that in a hundred years, it is totally back to groundwater, original groundwater quality. Within the seven to 10 year period, you see the movement of the groundwater back to sort of pHs of four, three to four, five occurring. At Beverley we have wells - monitoring of well fields there and we certainly see those trends in our in-field monitoring. 35 As you appreciate, we do a lot of reactive transport, hydro geochemical modelling to understand how the natural attenuation is going to work at each site. MR HANDSHIN: There was 11 or 10 years ago, some contention about the 40 concept of natural attenuation - - - DR MARSLAND-SMITH: Yes. MR HANDSHIN: - - - and whether it was a legitimate science phenomenon. 45


Can you tell us how the technology or research has developed since that point in time and where there is a consolidated international perspective about it? DR MARSLAND-SMITH: Yes. There is a consolidated international perspective about it. And I will just go back to the first – one of the first 5 principle proof that NA or natural attenuation works is that if that process was not happening, we would not need to redoes our groundwater each time it goes through the cycle because if the rock is not doing any attenuating, or there’s no reactions happening, then that fluid would only need to reduce the acidity once and it would be for the next two to three years wouldn’t need to dose any more. 10 But because there’s that reaction going on, we need to dose every single cycle that we recirculate that groundwater. MR HANDSHIN: Presumably that would in part be due to the processing operations though wouldn’t it? 15 DR MARSLAND-SMITH: No, it’s exactly what’s going on. It is those clays wanting to get that groundwater back to neutral pHs, so we have to keep lowering it and keep putting in conditioning agents to lower it because of that phenomenon that’s going on. So when you turn off and stop dosing that’s what 20 process is going on when it’s moving in to that fresh rock. So in the states, 95 plus per cent of operations are in drinking water quality aquifers. So they have to consider enhanced remediation in those circumstances. At Beverley the beneficial use, environmental value of our water is industrial, so natural attenuation is an accepted methodology for closure of ISR mines in this 25 scenario. COMMISSIONER: If you were to expand exploration - - - DR MARSLAND-SMITH: Yes. 30 COMMISSIONER: - - - is there any impact in terms of the amount of water that you need? Is that a restricting factor for you? DR MARSLAND-SMITH: No, not really. We use rotary mud drilling for – 35 because we are in unconsolidated sands and we need to – we are in a sedimentary basin, when you drill a hole you need to keep the hole open once it’s drilled, so you can put your geophysical probes down hole to measure your parameters. So you need water for that process. We mix water with some drilling mud to keep the holes open and it’s a standard process in petroleum 40 exploration - - - COMMISSIONER: Yes, understand. DR MARSLAND-SMITH: - - - as well. 45


COMMISSIONER: Where does that water come from that you use? DR MARSLAND-SMITH: We just use local water bores, that are shallow bores, work with the pastoralists and/or we’ll drill our own and because there 5 are some other aquifers, shallow aquifers that have very salty water but nonetheless water that we can access for that purpose. COMMISSIONER: So it’s not a restricting - - - 10 DR MARSLAND-SMITH: No. COMMISSIONER: In terms – if I might, in terms of future exploration, where is Heathgate at the moment in relation to that? Is that something you are continuing on, or is that – because of the uranium price at the moment, it’s in a 15 bit of abeyance or how do you manage that? DR MARSLAND-SMITH: The answer is yes, we have programmes ongoing all the time. So we haven’t really ramped back because of the uranium price, it’s more we’re busy developing a project right now. What is – we don’t want 20 to grow so big that we can’t develop our projects at a cost benefit price. COMMISSIONER: Yes. DR MARSLAND-SMITH: So it’s more around what are we doing at the time 25 that requires our resources to focus on things. But nonetheless, we always have around one to two million dollars worth of exploration expenditure a year. Collectively over the last 15 odd years, we’ve invested more than 160 million dollars in exploration and that is what has led to the discovery of what you see today. There is no doubt now that further out in to the basin is now where we 30 need to look at and that poses it’s own challenges in terms of where do you start looking, apart from – because where the deposits are now, we are fairly – in terms of an exploration model, very logical places to look. Whereas now we are faced with the challenge of – well, where else do we look in this wide region and so we are again working with CSIRO, as I mentioned earlier, to 35 help us target towards where we need to have a focus look. COMMISSIONER: The annual exploration that you – budget that you referred to a moment ago is that used for both greenfields and brownfields exploration? 40 DR MARSLAND-SMITH: We don’t really discern between the two. Brownfields for us is almost getting to, well where’s our next well fields going to be. So because the roll fronts are so – it’s not like a gold scene where you can chase it along a fault for kilometres. To find a new deposit away from the 45


current system is totally greenfields exploration. MR HANDSHIN: Can I just ask one question in relation to the possible expansion of in situ mining in the state; in particular as you move away from the Frome embayment, does that raise potential issues of the use of better 5 quality groundwater as part of the in situ process? DR MARSLAND-SMITH: I think every time – each project needs to be assessed according to its own groundwater quality, so if there is a requirement to do active remediation then we would look at that and work with the 10 authorities on that issue. So it’s not – it’s really the groundwater quality determines what closure mechanisms you are going to employ. COMMISSIONER: Can I just hypothesise for a little bit, if the price of uranium went to the $70 that you were talking about, what increase in activity 15 might you expect in this facility? I mean if there was a stable price of $70 per pound, what might it do to employment? To export? Or is it pretty much a sort of two million pounds operation almost irrespective? DR MARSLAND-SMITH: Yes. The resources are always limited, so we 20 don’t have unlimited resource so we need to find more resource to be able to see us through. If the price goes up, we want to maximise the production during that time of course, we need more resource. So that is our focus right now. Yes, just - - - 25 COMMISSIONER: I am just trying to get a sense of - - - DR MARSLAND-SMITH: Yes. COMMISSIONER: I am trying to get a sense of answering the terms of 30 reference, which talk about an expansion of mining opportunities. Now you have talked about the environment being satisfactory - - - DR MARSLAND-SMITH: Mm’hm. 35 COMMISSIONER: - - - and that we have bipartisan support, so both of those conditions are pretty much met by your evidence. I am just trying to get a sense of what might the rosiest picture be, moving forward as a potential opportunity for the State. 40 DR MARSLAND-SMITH: Yes. COMMISSIONER: And I think your point is well made, that there is no infinite resource available to the company, but I'm just trying to get a sense of - you know, if we had the most positive price for uranium that we're likely to see 45


in the next decade or so, what impact do you think that would have on the operation itself in terms of output, job opportunities, in the broader sense? DR MARSLAND-SMITH: Yes. Notwithstanding an expansion of the resource, you know, we would probably increase production a few orders of 5 magnitude, but again, it just depends on our cost per pound at the end of the day. COMMISSIONER: Yes, of course. 10 DR MARSLAND-SMITH: If you employ more people that affects that. So you might have a $70 a pound price, but it's all offset by that operating cost. So it's that balance. COMMISSIONER: And the order of magnitude of two or three times, does 15 that mean an order of magnitude of a couple in terms of workforce? DR MARSLAND-SMITH: It would need to translate to something like that, but not a direct-- 20 COMMISSIONER: Not direct. DR MARSLAND-SMITH: Yes. COMMISSIONER: Yes, understood. 25 DR MARSLAND-SMITH: So, yes, we're very good at keeping our workforce at a level that sustains our production at any one time. Yes. COMMISSIONER: Yes. I understand. Could you give us an idea of the size 30 of the workforce at Beverley, for example, when it was operating? DR MARSLAND-SMITH: At Beverley, when that was operating, it was around 80 people, and so on site at any one time there would've been around 40. Currently we've got a total workforce of around 155 people and, you 35 know, about 80 of those are cycling through the mine site. COMMISSIONER: Is it logical that there are other ISR deposits throughout the State? 40 DR MARSLAND-SMITH: Certainly, and in my view, it will take people who have the expertise and the understanding of these systems, that knowledge base, to filter through, which will result in successfully planned exploration programs. So, you know, we need to look at how we can better teach this type of uranium exploration at university, for example, or even just industry 45


workshops, to get some more information around how we explore for roll-fronts. There's no such program here, so we actually send all of our key professionals overseas to get there training, and that has actually directly led to the success of our discovery here. Yes. 5 COMMISSIONER: Is it realistic with the scope of our operation that we could have such a training facility established in the State? DR MARSLAND-SMITH: Yes. I don’t think it needs to be large or funded, you know, to any large extent. Honestly, it's probably just an industry 10 workshop as a start, and to get the world's leading experts over to start disseminating around the science of roll-fronts and, you know, the interpretation of the downhole logging systems and how does the gamma radiation work and how do you interpret that to find ore bodies, and how do you look at that redox, as I was talking about before. 15 MR HANDSHIN: In the absence of that kind of development, is it your view that it really is going to take, at the moment, an ISI miner to find other ISR deposits? 20 DR MARSLAND-SMITH: It would be my guess, yes, you know, but it's not a hard thing, you know, but again, it's just getting the knowledge out there to understand how to look for them. Yes. MR HANDSHIN: There's just one more question that I forgot to ask when we 25 were talking about Beverley and the monitoring that's in place there. Have you got a timeline over which that monitoring is going to continue, and is that part of a closure or decommission plan? DR MARSLAND-SMITH: Yes. So as part of closure we have a seven-year 30 commitment to continually monitor how that natural attenuation is progressing, as well as other environmental, you know, flora, fauna requirements, but we have to establish a trend and demonstrate that the natural attenuation is working before the end of that seven-year period expires. If there is no demonstration then we need to go back to government and work together to 35 work out exactly what is the next requirement. So initially it's a seven-year time period where we demonstrate natural attenuation is working, and next year at Pepagoona, for example, we have plans to put in well arrays to start that process off. So we do it ahead of time, not just at closure. So we're proactive in that area to try to understand prior to the actual requirement in our approvals 40 to undertake those studies. COMMISSIONER: I might just have one final question, I think. In your evidence, I think it was 14,000 drill holes? 45


DR MARSLAND-SMITH: Yes. COMMISSIONER: And a 15 to 20 K drill hole? DR MARSLAND-SMITH: Mm-hmm. 5 COMMISSIONER: Is there anything on the horizon that gives you confidence that you might be able to significantly reduce the per drill hole cost? Is there any technology that’s - - - 10 DR MARSLAND-SMITH: We are constantly looking at that because that's cheap. A production well costs around 80 to $100,000 a well. So it's those cost savings that we constantly do look at and, you know, things like do we manage the consumables ourselves, you know, as apart from the drilling contractor, and things like that, but certainly - - - 15 COMMISSIONER: That's in the margin, I suspect. DR MARSLAND-SMITH: - - - that's the stuff, yes. But any advance I drilling - and I know that UNCOVER program was looking at logging and drilling at 20 the same time and utilising - you know, so there's less time taken on a particular drill hole. So it's those things that we look at all the time too and we have similar developments in that space. COMMISSIONER: Is there an active service mining industry here in South 25 Australia? DR MARSLAND-SMITH: Well, we only really use drilling contractors because our whole operation is just drilling wells and that's it, and some poly welding of poly pipes and a little bit of construction in terms of plan 30 modification, but it's not haul trucks and we don’t require mining services like, say, Olympic Dam would and that extent. COMMISSIONER: Okay. Dr Marsland-Smith, thank you very much for your evidence. 35 DR MARSLAND-SMITH: Thank you. COMMISSIONER: We'll adjourn until 11.15 when we'll have the Environmental Protection Agency. 40 ADJOURNED [10.48 AM] RESUMED [11.15 AM] 45


COMMISSIONER: Reconvene at 11.15 and welcome to the Environmental Protection Authority. Mr Handshin? MR HANDSHIN: Thank you. The Environmental Protection Authority is the independent environment protection regulator in South Australia. In addition 5 to administering legislation concerned with environmental protection and community safety, it provides advice on environmental management practices to both industry and the government. Since joining the EPA in 2004, Keith Baldry has held a number of directorial roles and is currently the director of mining radiation and regulatory services. Daniel Bellifemine has worked for 10 the EPA for 12 years and is the team leader in mining and the environment. Mr Bellifemine is experienced in the regulation of uranium mining and other areas of radiation protection. Gabrielle Wigley is a senior hydro geologist and specialises in assessments of groundwater contamination both during the life of a mine and post-closure. 15 COMMISSIONER: Thank you. Welcome all. Part of our terms of reference require the commission to look at expansion of uranium mining and other aspects of the nuclear fuel cycle and with particular reference to safety and today we want to explore some of the implications of uranium mining and 20 exploration and particularly the start with mining and in situ recovery techniques. I guess in terms of mining, the area that worries most people would be the tailings and the technique itself in terms of in situ mining. So perhaps we might just start with what does the EPA look at in terms of those two areas? In terms of tailings in the broader sense and then we’ll unpack that 25 as we go? And in situ mining, what are the areas of concern that you are particularly mindful of as you look at these activities? MR BALDRY: I think that probably the main concern is that there is control of the waste and control of the mining fluid, such that they don’t result in 30 impact in groundwater aquifers and/or surface waters or off the mining site. And so much of our work is around the assessment of proposals to see that there is an understanding of the geological and other conditions. That there is an understanding of the potential impact from the waste arising from mining activities or from mining fluids and that those can be adequately controlled and 35 that there is sufficient monitoring and standards in place such that compliance with the requirements can be understood and reported to the regulator. We obviously need a framework to be able to step in and take action if we are not confident that it’s being done sufficient to protect the environment. 40 COMMISSIONER: And that would be equally applicable to in situ recovery? MR BALDRY: Yes. In situ recovery mining is a particular technique which, as you will have heard earlier today, involves – requires to undertake the mining, a really good understanding of the geological conditions underground. 45


That is very important for us also because we – whilst the operator has to understand the movement of mining fluids in order to maximise the recovery of the uranium, we need to make sure that the hydro geology and the movement of mining fluids is understood sufficient to protect the aquifers beyond the aquifer that is being mined. 5 COMMISSIONER: Might just unpack some of that now. Mr Baldry, the EPA has involvement in the approval process of new mining operations, is that right? 10 MR BALDRY: Yes. COMMISSIONER: And so in relation to a proposal for example for ISR mining operations, can you give us an idea of the sorts of things that EPA would be looking at? And then after that we might deal with what sort of 15 control measures you might identify as part of your review process. MR BALDRY: Okay. I will give that a broad overview then I might pass over to Gabrielle who is particularly expert in this area. A mining lease proposal would be given to the Department of State Development and would 20 be referred to us for our advice on its content. So what we would be looking for is that there is sufficient understanding of the local conditions and the proposed activities such that we can be confident that it can be undertaken and the controls required to do that. But Gabrielle would be one of the people that would be doing assessments so it might be useful for her perspective. 25 MS WIGLEY: Initially a proposal will come through in terms of a mining lease proposal and we would then look through that and then give our comments back to DSD and we would refer to information on whether they had adequately defined the area that they want to mine, so that their conceptual 30 site model would be robust enough to incorporate all the base line data and then move on forward so that when they actually did start the mining, they would understand the groundwater specifically and also the geology in the area that they are proposing to mine. Then they would – when the mining lease has been approved that all has to be sort of embedded, all that information has to be 35 embedded in their PEPR which is the programme for environmental protection rehabilitation. That document would then look at the outcomes and the criteria and how that can be assessed to look at the risks and then of course the residual risks. 40 MR HANDSHIN: Why is it important as part of that process that the prospective operator demonstrate an understanding of the geology and the likely impacts of their operation on the environment? MS WIGLEY: Well, because usually there are issues that they might not have 45


considered when they’re mining. And as you actually start that mining process, specifically with the groundwater, they might impact groundwater areas that they didn’t know about, or they might impact mineralogy that they weren’t initially understood and that actually can affect when you sort of expose, for instance acid forming minerals to oxygen then you can actually get 5 acid mine drainage and that can drastically impact the groundwater. So having a good understanding of the area that you’re actually going to be mining, whether it’s in situ, recovery or open pit, or underground mining is really important and that is the things that we are looking at initially in that assessment of the mining lease proposals and PEPRs. 10 MR HANDSHIN: So can it be the case that as part of this process, that the EPA request further information or further studies be undertaken to ensure that you can check off on all of the relevant considerations/ 15 MS WIGLEY: Yes. So we will get – sometimes we will be getting a draft MLP and sometimes also mining companies might approach the EPA separately and say what are you looking for? How can we do this better? How can we get this sort of streamlined once we get this - mining lease proposals in? And the PEPRs as well. 20 MR HANDSHIN: And MLP that is an abbreviation for mining lease proposal is it? MS WIGLEY: Mining lease proposal, yes. 25 MR HANDSHIN: Okay. What role do environmental impact statements have at this stage of the process? MS WIGLEY: Generally environmental impact statements will come along 30 with the mining lease proposals and they usually detail more of the – my understanding is that they would have an impact on the actual surficial environment and they usually deal more with infrastructure that is associated with the mining lease and the municipal lease. So – or licence sorry. But it really is the mining lease proposals that we would be looking at. 35 MR HANDSHIN: Does the EPA have any role in relation to environmental impact statements? MR BALDRY: Yes, we do. We do. So we would look at both of them. 40 MR HANDSHIN: Okay. COMMISSIONER: Can I just pick up on how you keep current with what’s happening in the world in terms of ISR for instance? Because we have only 45


got one mine here? MS WIGLEY: Yes. COMMISSIONER: How do you keep yourself current with latest 5 developments in terms of regulatory oversight and techniques being used, and it’s particularly useful if we’re thinking about expanding? MS WIGLEY: Yes. Usually a couple of times a year, the EPA is invited to conferences or usually sometimes workshops or just sort of courses that DSD 10 are putting on and they want us to be sort of – have as much knowledge as we can to sort of assist them. COMMISSIONER: So these are intra-state as opposed to - - - 15 MS WIGLEY: They are intrastate as well as interstate, yes. COMMISSIONER: And international? MS WIGLEY: I think we have been invited to some international 20 conferences. I haven’t personally but, yes. MR HANDSHIN: Is there a discernible international view on ISR mining? MS WIGLEY: There is, yes. 25 MR HANDSHIN: And what is it? MS WIGLEY: We use different chemicals in different areas of the world because we’ve got different geology, so – and Australia specifically because 30 we have got the sandstone predominantly sandstone – uranium in the sandstone. We would actually use different quantities of chemicals than they might use in other countries where they might have more limestone. So we’re sort of knowledgeable about what other areas and what other geological provinces use but generally, the mining companies will work out what is the 35 best chemicals and the best technique that they need to use for their particular site and we will actually look at that information, as well as the international information to sort of compare the risks and how – if they are using the best practice. 40 MR HANDSHIN: Is it an accepted practice, and it’s implicit perhaps in what you’ve said, internationally? MS WIGLEY: Yes. So we have got some – we have actually got some guidelines that we’re actually currently updating, sort of Australian guidelines 45


that we’re actually updating to be more in line with international guidelines as well. MR HANDSHIN: And what formed the basis of those guidelines? Did you draw on international material or are they locally generated? 5 MS WIGLEY: I mean I’m not working on these guidelines, but I believe from just literature that I’ve read, that they will be looking in international standards as well. 10 MR BALDRY: So the Commonwealth government in 2007 with Geoscience Australia published the in situ recovery best practice guidelines. And that certainly drew on the sort of international experience and the US and Kazakhstan are two countries that with uranium use in situ techniques and the nature of it is that it’s very locally geology and hydro geology dependent and 15 so you can’t just take one experience and transplant here. But certainly it broadens our sort of knowledge about the best practice approaches. And in terms of best practice regulation, then certainly the EPA is involved nationally to make sure that we work with our fellow regulators in other jurisdictions and general regulatory approaches. And in relation to radiation regulation, we’ve 20 got a national committee that ensures we’ve got national standards for radiation protection. However, as the only state in Australia that actually has in situ recovery mining of uranium, then we would - - - COMMISSIONER: That’s a good point. 25 MR BALDRY: Yes. We do have a lot of experience though. We’ve had in situ recovery mining at Beverley since 2000, I think. COMMISSIONER: Yes. 30 MR BALDRY: And so it’s not as if – we would consider ourselves reasonably expert in terms of our experience with the operations that we’ve directly regulated as well. 35 COMMISSIONER: Is that experience localised at Beverley? I mean because we are looking at the potential to expand that. Are you confident that the information base for ISR within the EPA could address other locations with different geology? 40 MR BALDRY: Yes, I am. I mean the geology is different but - - - COMMISSIONER: Yes. MR BALDRY: - - - the principles of understanding geology and the controls 45


required are the same and experts within the EPA such as Gabrielle do work on non-mining activities in many parts of South Australia that require an understanding of that geology. I think even the difference between the Honeymoon mine that we did assess and approve and the Beverley and the Four Mile there is different geologies in each of those locations which require 5 slightly different approaches in the way that we require monitoring and reporting to be undertaken. MR HANDSHIN: What sort of considerations might arise in the event of a proposal to expand ISR mining outside of the Frome embayment? 10 MR BALDRY: I think that from my perspective, the two key things are the sensitivity of the receptors: are we looking at an environment where, either because it's completely sensitive or because there's a potential for movement of mining fluids to more sensitive receptors, does that require more control, more 15 monitoring, more assessment? And the other thing that would make a difference is the number of people in proximity to a uranium mine, because the consultation engagement with community is a really important aspect. Now, that is something that both Heathgate and formerly Uranium One needed to do, was engage with the local communities, but the more people you have near to 20 an activity, the more extensive the engagement program you're going to have. Those are two general aspects that would make a difference if you did it elsewhere. COMMISSIONER: Have there been any particular challenges with the 25 Beverley operation in terms of concerns for the EPA during the 10 or 15 years they've been operating? MR BALDRY: I think that certainly in the early operations of Beverley there was concern at particularly the control of the mining fluids on the surface and 30 there were some spills, and we actually introduced reporting criteria over and above our normal repeating criteria such that if there were spills they're reported not only to us but publicly as well, and I think that was in the nature of - it was a new operation for Australia and they have improved considerably since those early years, yet there were some spills in the early years that we 35 required action to be taken on. COMMISSIONER: So spills on the surface, in terms of water movement under the surface, in terms of their recovery, no particular concerns with the movement and the plume going beyond where they expected it? 40 MR BALDRY: No. I mean, there has been some movement of plumes that weren't where - - - COMMISSIONER: Forecast. 45


MR BALDRY: Yes, but we're confident that that was understood and monitored and recoverable. I think that the thing that's changed over time is - some things we've required additional monitoring or different techniques for sampling, and other things we found not to be necessary anymore and relaxed 5 in terms of the parameters that we require to be reported on. So we have learned ourselves over time as to what's important in terms of environment protection. MR BELLIFEMINE: I'll just add, certainly from a radiation protection 10 perspective, we've got sufficient data that demonstrates that over the course of time the doses to workers are quite low and certainly consistent with other operations internationally. COMMISSIONER: This is in Beverley? 15 MR BELLIFEMINE: Yes, Beverley, and the Honeymoon operation as well. MR HANDSHIN: Is that because of the nature of the technique? 20 MR BELLIFEMINE: Yes. I guess most of the workplace exposures are in the areas where product is actually handled. Obviously the in situ recovery technique means that there's less potential for exposure to the materials, which in themselves are relatively low radioactivity to begin with, but I guess the techniques that they use means that it's even more so amenable to reducing 25 those exposures. MR HANDSHIN: Mr Baldry, you referred a moment ago to some issues arising in relation to the movement of plumes and you said that you were confident that those issues were understood and they were then monitored and 30 were recoverable. Can you tell us what the EPA actually did at a grassroots level and when those issues came to its attention? MR BALDRY: We have regular meetings with operators and that - as a minimum, we meet quarterly with the Department of State Development as 35 well, and we discuss in detail the reports that are provided and so for every single monitoring well that will get reported during the lifetime that it's doing the morning, and when we have concerns we'll require further explanation at those meetings. We'll require, if needed, further information or further monitoring, and really that's a case of making sure that we're confident that the 40 operator understands and can control the mining fluids. It hasn't got to the point where we've ever required operations to stop as we were concerned about off-site impacts. So it's more of an ongoing process to ensure that they're continually in control of their operation. 45


MR HANDSHIN: Does the EPA have power to close down an operation if they consider its practices are giving rise to substantial environment risks? MR BALDRY: Yes. The Department of State Development is able to issue ministerial directions and that would be the usual first course of action in terms 5 of directing a mine to stop or change operations, but there are powers under both the Environment Protection Act and the Radiation Protection Control Act that mean that we can step in and take action if we think it's needed. MR HANDSHIN: We've heard some evidence this morning that one of the 10 ways that the containment of the mining solution used in ISR is monitored to ensure that it doesn't leave the mining aquifer is to install monitoring wells around the perimeter of the mining site. MR BALDRY: Yes. 15 MR HANDSHIN: Does the EPA have a view on whether that's a satisfactory control measure to prevent unwanted excursions of mining solution? MR BALDRY: I think it's the ideal way of seeing if you've got lateral 20 movement of the mining area, and so you need a pretty good understanding through modelling, but, you know, those perimeter bores, to actually see, you know, has it got to this point, is an essential part of the assurance program. COMMISSIONER: Do you map the location for those facilities or do you 25 take advice from the mining company itself? MR BALDRY: The mining company provides all of the maps and all of the locations and all of the monitoring results. 30 COMMISSIONER: Right. Okay. MS WIGLEY: I was just going to add that, going back to the developing conceptual site model, not only do you not want any lateral migration, that you don’t want any vertical migration as well, and that goes towards knowing that 35 you've got a robust basement at the bottom where there won't be any sort of infiltration past the depth that you're actually targeting, and so that goes to having enough baseline data in the beginning to know what you've got. MR HANDSHIN: And that's a product of the natural underlying geologies in 40 it. MS WIGLEY: That's right, and, like, we know what the geology is of South Australia, so that sort of has to be supported with the localised - the localised geology that the mining company will develop has to be supported with the 45


regional geology as well, and that's what we're looking at, that there's a consistency in their approach as well. MR HANDSHIN: One of the other topics that came up this morning was the concept of natural attenuation and how that might remediate any residue 5 mining solution that's left over in the mined aquifer post operations. Does the EPA have a view about the concept of natural attenuation and whether it's been verified on a national or international basis as a legitimate scientific concept? MR BALDRY: Yes. As part of the proposal for mining, we would require 10 that at the conclusion that there's no unacceptable legacy left, and, yes, the natural attenuation mining fluids is the expected way over the time that the sites will return to their pre-mining state. That's not to say that we're relying on that, because there's - we require monitoring over time to demonstrate that it's occurring in accordance with the scientific expectations and should it not 15 occur, then we would require alternative means of remediation, for example, removing the treatment to mining fluids or, you know, injection of different reagents. The experience we've had does tend to back up the expectation of natural attenuation, and so as the monitored fluids move through the rock there is a neutralising effect and the further it moves the more it gets neutralised. For 20 the mining aquifer there is no human or stock or other use of the aquifer other than for mining and so we don’t require a quick remediation of that at the conclusion of mining so they can be used for other purposes, so in that sense natural attenuation is an acceptable technique if it can be shown to be effective. 25 COMMISSIONER: It might work for that site, but if we’re to expand to ISI then presumably you’d need other assurances of attenuation. MR BALDRY: Yes, and certainly it would not be acceptable to contaminate aquifers that had a use or had environmental sensitivity and I think certainly 30 that’s where the international experience, for example in the US, shows that treatment of aquifers to attenuate rather than just leaving it to nature to do it is a technique that’s possible. Clearly we’d want to really understand that that was possible whatever the local circumstance was. 35 MR HANDSHIN: Post closure of an ISR site how long would you expect that monitoring of the aquifer would need to occur for to ensure that the process of attenuation is in fact operating? MR BALDRY: I think that that depends on the natural speed of movement of 40 the aquifers once you’ve stopped actually moving the fluids around for the mining itself and so there was the field trial at Oban which in relatively quick time the monitoring demonstrated that natural attenuation was going to be effective for that. I think for Beverley there’s an expectation that over a seven to 10 year period on the conclusion of mining you would be able to 45


demonstrate that your modelling and expectations on attenuation were correct, that depends on the results of the monitoring though and it may be possible to shorten that timeframe or if there was concerns it would be possible to expand that timeframe as well, but the expectation is that within a relatively few years after closure the monitoring would demonstrate whether your expectations 5 were proving correct or not. MR HANDSHIN: Apart from groundwater issues and mining solution issues does the EPA consider that ISR techniques give rise to other environmental considerations, perhaps on the surface? 10 MR BALDRY: I think any industrial activity in sensitive environments there’s a potential impact to which needs to be understood and effectively managed. The advantage with in situ recovery techniques over other mining techniques is that the footprint is considerably reduced and the impact is much 15 less. You don’t have waste rock and tailings systems, you don’t have a big hole in the ground, so the potential to return the location to pretty close to what it was before mining is good. Obviously the surface infrastructure and the sort of storage evaporation ponds need remediation, but it’s much more readily done with in situ recovery techniques than other mining techniques. 20 MR HANDSHIN: We heard this morning that some of the waste streams produced, at Four Mile for example, are relocated to the Everleigh aquifer for storage. What’s the EPA’s view on the suitability of that practice? Obviously it’s an approved one, but what’s the EPA’s view on that as being an 25 appropriate disposal method? MR BALDRY: It’s referred to in the Geoscience Australia perspective guide for in situ recovery mining is that injection to mined aquifers is the preferred disposal technique, so in principle we would support that. Every situation 30 needs to be explained to us and demonstrated the environmental impacts of course. MR HANDSHIN: What qualifications might there be when you say “in principle”? What would you need to see to develop a degree of confidence that 35 that is a suitable long term solution for waste storage? MR BALDRY: I’ll say something quickly and then hand over to Gabrielle. I think it’s the same as with the mining fluids. You want to make sure that any waste fluids you understood where it’s going to move to and what the 40 attenuation of a time was and what the ultimate sensitive receiver, whether that be another aquifer or some other use, was, so you’d need the same understanding as you would for the mining fluid. MS QUIGLEY: That’s pretty much what I was going to say. Also just what 45


Keith mentioned about monitoring we sort of consider natural attenuation, but we say it has to be monitored natural attention. It’s always MNA, it’s not just NA and that’s an important thing that we look at because it is that risk based regulation. 5 MR HANDSHIN: Can we perhaps move on to tailings more generally in relation to other tasks of operations and get an idea from the EPA on what the relevant environmental concerns are in relation to generation of tailings and there long term storage. 10 MR BALDRY: I think that tailings are common to many mining techniques and uranium is one of those. The main environmental risks with tailing systems are the fact that you’ve got things like acids and heavy metals, so the radioactive material tends to not be the most significant aspect with uranium mining, it’s just one of the additional hazards that needs to be addressed. 15 Containment, effective containment, is an issue with tailings because it’s – if you look at the examples that we’ve got such as Olympic Dam because it’s above surface they need to be engineered structures which can be demonstrated over time to effectively contain the tailings and that would probably be the most significant issue; is the demonstration of the containment. 20 COMMISSIONER: I know I’ve seen them, at Olympic Dam there are a number of tailings dams. Before a company has approval I presume they will need to have their tailings dam plan approved by the EPA; how it’s going to be managed, where it’s going to be located, the construction, the geology of the 25 area. All those issues need to be considered? MR BALDRY: Yes, certainly and the EPA and the Department of State Development have published guidelines for a miners perspective, miners on the expectations for tailings management, but, yes, we would expect to as part of 30 the proposal understand that waste can be effectively managed and that’s a key part of it. I think there’s different roles between DSD and ourselves in that there’s a lot of mining engineering requirements to make sure that structures retain the tailings and so we’d probably rely on DSD’s advice that the mining engineering aspects were effective on that and the standards were met. We’ve 35 probably got more of an interest in making sure that the impact on surface waters and aquifers were adequately understood and controlled. COMMISSIONER: In relation to the tailings at Olympic Dam, and we’re again not seeking to go back, we’re seeking to think forward as well, but 40 clearly in the management of those activities it’s relevant to expansion. How do you manage the impact of fauna and wildlife on the dam activity itself? Is that part of the EPA’s responsibility or is it - - - MR BALDRY: It’s not part of the EPA’s responsibility for example to control 45


the fact that if fauna enter the tailing facilities and drink the water that there’s - for example birds and other animals, so we don’t regulate those aspects, but we would regulate the wider environment in terms of if tailings was not effectively contained within the structure. There are other agencies that look at the impact on - - - 5 COMMISSIONER: Who is responsible for the fauna aspect? MR BALDRY: DSD is the main regulator of mining operations. They would get advice from Department of Environment, Water and Natural Resources on 10 the impact on the fauna and the flora to do that. COMMISSIONER: In relation to the Olympic Dam operation, have they actually sealed up a tailing stand yet, or are they all still operating? I am seeking to understand how you – once it’s full, how do you close it off and 15 how do you monitor it over the longer term? MR BALDRY: The tailings are constructed to be in their final form, such that they can be capped and then left as the final form and over time BHP Billiton has moved on from its original tailings. 20 COMMISSIONER: Yes. MR BALDRY: Daniel’s probably got the – best placed to answer the progress that has been made on that. 25 MR BELLIFEMINE: Yes. I mean at the moment the closure plans specific to the Olympic Dam operations are being revised and developed, so the current ones are being reviewed at the moment but the current approved ones have enough – sufficient detail for us to understand what BHP propose to do but the 30 actual operational detail of that will be developed further towards closure. I mean the operation is set to run for quite an extensive period. So that detail will be developed as time will go on. I guess the main sort of processes that have been identified at the moment is allowing the tailings to sufficiently dry to allow earthmoving equipment to go on to them. And then they would be 35 covered with soil, rock cover and the slopes reinforced and then there’d be an ongoing monitoring programme around that to demonstrate the stability criteria and also the radiation protection aspects had been achieved, so that those closure activities are able to meet those criteria. 40 COMMISSIONER: And that presumably goes on for a very long time? MR BELLIFEMINE: The monitoring, again, would need to be – and the extent of that would need to be developed as the actual detailed closure plan is developed but that would need to be ongoing until as needed. So some of the 45


lead times would be variable. COMMISSIONER: But at the moment it’s reasonable to assume that the tailings facilities will remain in their current location? So the remediation will involve capping, as you described but the facilities themselves would be there 5 in the long term? MR BELLIFEMINE: Yes. I mean given that they are around 400 hectares presently, the residues would be managed in situ. So part of that is the actual management of them as they are. 10 COMMISSIONER: Has there been any specific concerns over the operation of the mine in terms of the tailing dams themselves? Leakage? MR BELLIFEMINE: Yes, there have been some leakage from the walls. 15 COMMISSIONER: Yes. MR BELLIFEMINE: So that has triggered additional monitoring around those. 20 COMMISSIONER: Do we learn any particular lessons from those activities? MR BELLIFEMINE: Yes. So they have – probably I think it was two years ago, TSF5 was developed and that’s taken on a lot of the lessons learnt from 25 the previous tailing structures. So there’s certainly been a trigger for ongoing auditing and monitoring that government is required to sort of keep track of the tailings and the stability of those and the – any of the issues that have been seen with seepage as well. I mean for example TSF5 was also aligned within the centre to prevent or minimise the amount of seepage, keep it to an acceptable 30 level. COMMISSIONER: So the problem was an issue with engineering more than anything else? 35 MR BELLIFEMINE: I think the details, I mean Gabrielle might have a bit more detail but some of it was around the walls being constructed and engineered around some of the dunes, the natural dunes in the area. So that was sort of dealt with in the subsequent tailings that were developed. 40 COMMISSIONER: So the lessons learned are reinvested in to the next - - - MR BELLIFEMINE: Yes. Certainly, yes. MS WIGLEY: Yes, it’s specifically an engineered sort of (indistinct) whether 45


they are stable. MR HANDSHIN: You mentioned that there’s a lining in the centre of one of the tailing storage facilities. Why is it that the lining is confined to the centre of the pond? 5 MR BELLIFEMINE: Well, I guess the way the tailings are managed is that the water is collected towards the centre to allow for evaporation, so it’s more relevant operationally to have that lining in the centre of the pond. 10 MS WIGLEY: And they want to reduce the pond amount, they don’t want it sort of – they don’t want a thin layer over the whole of the tailings dam, it’s more stable if you’ve got that pond in the middle and less chance of wildlife and stuff like that getting stuck. 15 MR HANDSHIN: Perhaps it’s not much of an issue given the location but what sort of tolerances need to be built in for unexpected rainfall events for example? And are they adequately accommodated at the moment? MR BELLIFEMINE: I believe that there is a – that has been built in to the 20 tailings – was factored in to ensure that the evaporation ponds which complement the tailings dams are managed in such a way that if there is unexpected rainfall, that they have got that contingency there, so that they can manage the amount of water within the tailings and that they’re not affecting the strength of the walls around those tailings dams. 25 MS WIGLEY: That’s one of the things we look at in the mining lease proposals. We look at – for significant rainfall events and whether they’ve been appropriately estimated. 30 MR HANDSHIN: Perhaps on the other side of the coin, given the generally arid conditions in the area, how is dust mobilisation managed? MR BALDRY: The issues for BHP Billiton can – with dust tend to be operational in the sense that the people most affected are the people on site. So 35 they have a programme for managing the dust principally to control that with – if you were looking at wider dust issues, the nature being an underground operation, the nature of the operation is that regionally if there is dust storms they are going to arise from dust arising from very large and widespread area, not from the mine site itself. 40 MR BELLIFEMINE: They do have the carts to wet down the roads periodically to prevent dust and again, as Keith mentioned that is more for occupational than for impacts to the broader environment. We have dust monitors at the Roxby Downs township and certainly that, as well as radon 45


monitors are demonstrating that doses to member of public well below the one millisievert limit and in fact, it was magnitude below that. COMMISSIONER: Might be a good time to get on to personal radiation safety and your responsibilities. How you monitor it? What processes are in 5 place for that since you introduced the subject, you might as well close it? MR BELLIFEMINE: Yes. I guess so with the broad framework is that the Radiation Protection Control Act, mining and all processing is licensed – a licensed activity. As part of that licence we require compliance with the code 10 of practice for radioactive waste management which was an Australian ARPANSA published code. So we adopt that to ensure that there is national uniformity across radiation protection management within Australia. Part of that mining code requires a radiation management plan and within that plan we – that requires identification of radiation source pathways to work with and 15 requires a description of how those pathways are controlled and how they’re monitored and it also requires obviously reporting to the agency. So we are able to get periodic quarterly reports on occupational monitoring. The programme is set up and developed to ensure that those areas with the highest potential for exposure are monitored. 20 COMMISSIONER: And those areas in a typical uranium mining and milling operation are where? MR BELLIFEMINE: Principally the areas that are handling product tend to 25 have the highest potential doses, so most of the focus is on those particular areas. For example, the doses we might see work groups around tailings facility, at Olympic Dam are still within the 1 millisievert range. A dose limit for a radiation worker who is someone handling or working around radioactive material is 50 millisieverts in one year or 20 millisieverts, the 50 being 30 averaged over five years. It needs to be averaged to be 20. So, I mean, we obviously have seen that with an order of magnitude below that level. MR HANDSHIN: In relation to the reporting requirement, does the EPA have a role of auditing or verifying data that's received? 35 MR BELLIFEMINE: The data is collected by the operator, but we do have a radiation monitoring laboratory and that is - I guess the value in having that is that we have a good understanding of radiation dissymmetry and measurement techniques. Our role in verification is we do conduct it, but it's a component of 40 what we do, and our inspections are also include activities like auditing and general inspections of workplace safety. MR HANDSHIN: And in what circumstances do you generally do inspections? 45


MR BELLIFEMINE: Well, for the uranium mines we generally conduct an inspection quarterly, irrespective of whether there's a trigger or not. There may be additional inspections if there's infrastructure or a change to process which needs to be investigated. We may do inspections where we look at, say, a spill 5 if that had occurred. COMMISSIONER: Can you just walk us through what a typical inspection would be, if there is such a thing? 10 MR BELLIFEMINE: Yes. The inspections follow a general sort of format. If there's an area that we're going to focus on, we will sort of discuss that with the operator. I guess part of the reason for that is to ensure that our workers are able to conduct an inspection in a safe manner. Mines are by nature - you know, have safety requirements. So often there's a requirement for inductions 15 and that. So we generally have the radiation management plan. It's a radioactive waste management plan. So we might focus on a component of that. It tends to be anything from talking to the radiation safety staff. That's a requirement for each mine site to have a radiation safety officer. 20 But we also might discuss and determine that the staff that are actually implanting the radiation management plan have an understanding of what their roles and responsibilities are on site. And then that's normally followed up with an inspection report and you're able to continued engagement with the operators for any improvements or things that might need to be looked at 25 further. COMMISSIONER: So it's quarterly? MR BELLIFEMINE: Yes. Generally the inspections are quarterly, yes. 30 COMMISSIONER: And duration on site? MR BELLIFEMINE: Well, that varies as well. So the inspections might last from one to two days given that the sites are remote. We tend to sort of stay up 35 for prolonged periods. By contrast, an inspection for one of our industrial licences in the metropolitan areas might only take one or two hours. MR HANDSHIN: Putting radiation to one side and looking at compliance issues more generally, does the EPA have a practice in supervising compliance 40 with licence conditions, for example, or general environmental safety? MR BELLIFEMINE: Keith has already mentioned that we do work closely with the Department of State Development, so where possible our inspections are conducted jointly with that department. So we have a range of regulatory 45


tools that are available to us if there is a non-compliance. DSD being the lead regulator, we have an administrative arrangement with them. So if there is a non-compliance noted, then we would generally discuss that jointly and determine who the lead agency might be there, and then we'd select the most appropriate regulatory tool. 5 MR BALDRY: We have a role in the religion of human health impacts from radiation, but other safety aspects the EPA does not have a role in. So DSD and SafeWork, per se, would the principal regulators in that area. 10 COMMISSIONER: Who has the responsibility of transport? MR BALDRY: The transport of radioactive material is the regulator. The regulations are administered by the EPA. They are regulations under the Radiation Protection Control Act. 15 COMMISSIONER: That's what I thought. MR BALDRY: So those would be in addition to any other transport regulations that would be regulated by the police or the Department of - - - 20 COMMISSIONER: So you're concerned with the safe radiation protection of the convoys - - - MR BALDRY: Yes. 25 COMMISSIONER: - - - down to the egress site or to the port (indistinct) MR BALDRY: Yes. 30 COMMISSIONER: This mine has been operating now for quite some time. Have we had any incidents of transport issues, to your knowledge? MR BALDRY: To my knowledge, there have been no instances where the actual road transport has had an incident that threatened, for example, loss of 35 containment. There have been incidents on rail to the port of Darwin, which didn't result in a significant loss of containment, and we've had containers damaged at Port Adelaide, again, which didn't result in a loss of containment from a container. 40 COMMISSIONER: Okay. So you use rail and road. MR BALDRY: Yes. It's road transport to Port Adelaide on all occasions and then it's either shipped either from Port Adelaide or then railed from there to a port at - - - 45


COMMISSIONER: To another port. MR HANDSHIN: Can I perhaps shift the focus a little bit to down-the-track considerations, and one of those relates to decommissioning or closure plans. 5 Is it right that uranium mining operators have to have a closure plan in place as part of their licensing or approval conditions? MR BALDRY: Yes. So the permit for environment protection and rehabilitation would include the closure requirements. 10 MR HANDSHIN: And do they currently extend the provision of financial assurances for site remediation and place closure? MR BALDRY: Yes. It certainly is the case for - Olympic Dam is a special 15 case because of the particular legislation that applies to the indenture that applies to Olympic Dam. Further operations then - the Department of State Development has a process in place for assessing appropriate financial assurances of bonds and for reviewing those, I think, every two years to make sure that it covers the continual ongoing cost of remediation should the 20 operator, you know, not fulfil their obligations. MR HANDSHIN: And do you know whether that involves money being held on trust or by some other arrangement, or is it just an assurance that’s given by the operator that funds have been allocates for those purposes? 25 MR BALDRY: No, it's either cash or a bank bond. So there's no access to the money by the operator until they've met their obligations to close and remediate the site. 30 MR HANDSHIN: Can I just perhaps clarify a couple of matters that I overlooked when discussing the tailings issue, and this was part of my question in relation to dust mobilisation that I might not have made sufficiently clear. Is there a concern of dust from the tailings storage facilities being generated into the surrounding community given the conditions that generally prevail at 35 Olympic Dam? MR BALDRY: The nature of the construction of the tailings is that they're accumulated and drying in the process, and if there was a concern that there was dust being generated because they were too dry, then they would need to 40 be re-wetted in order to prevent that happening. As Daniel mentioned, the nearest community at Roxby Downs we do monitoring for both dust and radionuclides. We'd be surprised if there was a dust issue that reached there, but there'll be an expectation on the tailings system being effectively managed that it did not occur. 45


COMMISSIONER: Presumably we'd also be concerned about the workforce. MR BALDRY: Yes. Yes, in terms of radiation protection the principle routes of exposure to radiation are from dust and from radiation emissions, so there’s 5 pretty low residual reactivity in the tailings, but, yes, it would be something that would need to be – protection of workers is obviously very important. MR BELLIFEMINE: One of the controls for workers around the tailings is to limit the time spent around the tailings because of the gamma radiation is one 10 of the sort of more prominent pathways for workers in that area. As I said the doses are within the one to two millisievert range in any case, so they’re well below the dose limits, but they still do implement that control. MR BALDRY: Actually in terms of radiation doses there’s an 15 Australian National Radiation Dose Register to which all of the uranium miners in Australia report to and shows the results and that’s managed by the Australian Radiation Protection and Nuclear Safety Agency and so there is a national depository of all doses to uranium workers and in addition there’s the United Nations (indistinct) that collects radiation doses worldwide from all 20 activities involving radiation, including uranium mining, and makes assessments of risks associated with those activities. COMMISSIONER: If we were to think forward to having a nuclear industry, and we’re not there yet, what sort of development would you think EPA would 25 need to undergo to manage that sort of environment? We’re talking about an environment with potentially expanded mining, potentially conversion enrichment of fuel fabrication. Do you see a different sort of structure than the one you have at the moment? I know I’m putting you on the spot here because it’s not something we’ve discussed previously, but we do have to turn our mind 30 to that sort of issue. MR BALDRY: Yes. I think there’s a difference between an expansion in mining and an introduction of new activities such as conversion enrichment and that is potentially nuclear power. I think that we have the structure and 35 capabilities for an expansion of mining and it would be a resource capability that would need to be addressed then. If there was more mining in more locations we would need a greater capability to look at the amount of new activities that are occurring, but the regulatory structure is suitable and the skills and the type of organisation we are is suitable to manage that sort of 40 activity. When you’re looking at the conversion enrichment, and the same applies to high level waste management and certainly to nuclear power, is that there’s a different sort of approach to regulation of those and it’s around the assessment of safety cases. That’s a capability that we don’t have a significant amount of within the EPA because it’s generally not part of the sort of 45


regulation that we do, that would be different and would need to be addressed, but I don’t think that the legislation as it is – the legislation prohibits some of these activities, but other than that change I think that there would need to be a review of the legislative framework such that you could approach this sort of safety case way of assessing and controlling activities. I think if it was 5 appropriately structured around that. It’s certainly possible because there’s plenty of places where it happens and I think in South Australia we’ve got a stable government, a stable economy, so with the right approach it certainly can be done here, but I think for those new activities it certainly would require different capabilities within an organisation like the EPA, a review of the 10 legislation to see if it adequately did address those activities. COMMISSIONER: Do you think that organisation or structure might be a commonwealth led organisation or a bit of both? Do you see any benefit in a national structure as opposed to a state-wide investment? 15 MR BALDRY: I think for any regulatory structure it needs to be effective and efficient, so there’s probably a number of options and it would be crazy not to use the commonwealth experience of, for example, the regulation of facilities at Lucas Heights and its other licensees. I think that the other aspect of 20 conversion enrichment you start then getting into the uranium safeguards territory then there’s definitely a role for the Australian Government in that, so you couldn’t go it alone in South Australia without at least forming really good partnerships with the commonwealth bodies. As far as what the structure of an organisation looks like, whether it’s a commonwealth body or a state body, 25 yes, as I say, you want to make it the most effective and efficient to deal with the operations you have. COMMISSIONER: Thank you. Thank you very much for your time on both days. 30 MR BALDRY: Thank you. COMMISSIONER: We’ll adjourn now until 1400 when we’ll have BHP. 35 ADJOURNED [12.16 pm] RESUMED [2.00 pm] COMMISSIONER: Being 1400, we'll reconvene, and the issue remains on 40 expansion and exploration of mining activities, and BHP have joined us. MR HANDSHIN: The next witness to give evidence is Ms Jacqui McGill of BHP Billiton. BHP Billiton is a global resources company which produces a number of commodities, including iron ore, metallurgical coal, copper and 45


uranium. Since taking over Western Mining Corporation in 2005, BHP Billiton has owned and operated the Olympic Dam mine in South Australia. Olympic Dam is a large polymetallic underground mine located approximately 550 kilometres north-northwest of Adelaide. It is the fourth largest copper deposit and the largest known single deposit of uranium in the 5 world. Jacqui McGill is an experienced resource professional with a broad portfolio of operational experience in the resource sector, include iron ore, coal, base metals and uranium. She is currently the asset president at Olympic Dam. 10 COMMISSIONER: Ms McGill, welcome. MS McGILL: Thank you. 15 COMMISSIONER: I noticed BHP gave us a very useful submission to the Royal Commission and particularly to the area that we're interested in today, the expansion of mining for uranium in the State, and the key recommendations, as I recall, were about reducing regulatory complexity and duplication between the States and the Feds, and also improving access to the 20 body of learnings of extraction and exploration in the uranium sector. So we get to those two areas, because they get to the heart of the issue of what might we do, apart from the obvious, find more uranium, about expanding the industry. So that we have the context, could you give us a short characterisation of what's at Olympic Dam at the moment, how you mine it, 25 and the sort of output that you currently have? MS McGILL: Most certainly. The Olympic Dam operation is an underground operation. We source around 10 million tonnes of underground material, which is hauled to the surface by the Clark shaft as well as truck haulage 30 decline activities to the surface. Once the ore is transported to the surface, it's processed through a grinding circuit where the rock is ground to around a coarse sand material. That slurry then is processed via floatation processes where about 95% of the copper is recovered to a concentrate and that is then very high in grade in terms of copper concentration and also has the subsequent 35 correlation of uranium in that concentrate. Now, if we were to follow the flow of the concentrate through the flow sheet, the concentrate is then leached to recover the majority of the uranium prior to the concentrate being neutralised and sent to the smelter. The smelter then 40 processes the concentrate material and produces anodes. Those anodes are then subsequently processed through our refining process to produce what we call OlyDa copper. So it's Olympic Dam specification copper in final cathode form. In total, we produce around 200,000 tonnes of copper from Olympic Dam annually. 45


So that's the concentrate phase, which is around 5% of the total volume majority of the copper. If we were then to go back to the flotation unit operation and we take the tailings, the tailings from the flotation process is subject to a leaching process. So it's 95% of the volume and we leach that 5 tailing to remove the uranium. We remove that uranium via an acidic elevated temperature leach. We recover the uranium into solution. The solution is then concentrated and purified using solvent extraction processes, and we also recover some copper from a solvent extraction process as well on that same volume. That material, the uranium liquor, then is processed to the uranium 10 processing facility which recovers it to a final uranium oxide concentrate. We produce around 4,000 tonnes annually of the UOC. COMMISSIONER: That production, is it directly linked to the amount of ore that you crush, or do you determine the market at the moment in relation to 15 how much - - - MS McGILL: No. We process it as it flows through from the ore. COMMISSIONER: It doesn't. 20 MS McGILL: Yes. We don’t control the output on the basis of market economics at all. COMMISSIONER: And then that's transported to Port Adelaide where 25 it's - - - MS McGILL: That's right, dispatched. COMMISSIONER: There's been a lot in relation to the expansion of Olympic 30 Dam. I'm not after any commercially sensitive information, but I'm interested in the broader prospect of what you're thinking about and has been disclosed about the mine and the broader time frames that you might consider. Again, I emphasise I'm not looking, and you wouldn't give me, any commercially sensitive information. I'm seeking to get a broad overview at this stage of the 35 planning process that's currently underway. MS McGILL: Well, as you know, in 2012 we were proposing to do quite a significant expansion of the Olympic Dam facilities, which included an open-cut operation and then moving through full-scale upgrading and 40 increasing of total capacity on the surface. So all of those unit processes that I described to you would've been increased subsequent to that slow-down in the economic conditions, challenges around the economic viability of that project. We've really done a review, and where we sit today is really reviewing our position. Since Olympic Dam was founded we've probably accessed around 45


30% of the ore body. We have, in fact, that 70% of the ore body which is untouched. So our current development program is around accessing that 70% plus of the ore body, which we describe is a southern mine area. Now, that southern mine 5 area and the reason it's the same ore body - it's the same piece of the puzzle that if I was to describe to you - some people use a saucepan. I prefer a guitar in terms of the shape of the Olympic Dam ore body. So we've been mining the neck of the guitar since 1987 or five, the neck of the guitar, and right now we're working on the body of the guitar, and that's our southern mine area 10 development. Now, that area we'll access via the same mining methodology that we apply on the northern mine area. So previously we were going to dig down from the surface and expose it via an open cut. Now we're going to develop it through 15 underground developments and drives. We believe the economics are superior. It will enable us to access it over a period of time, longer than perhaps was originally planned, but in a way that's more sustainable. This then opens up new pathways for us for what the surface activity will look like. 20 Now, there are some options just to maintain our current flow sheet and configuration, exactly what we have today with some tweaks, or there could be the potential, which I'm sure you would've heard about, is the development of the heat bleaching process, and that provides, if you like, some simplicity and some benefits in terms of smoothing the variability of the ore when it's 25 presented to the processing facility. So heat bleach would come before any milling process. We would crush and stack the ore, process the ore by using a very weak acidic solution trickled over the top of the stockpile recovered via irrigation capture methods, and then we'd recover that uranium and a small amount of the copper in that subsequent solvent extraction phase that I talked 30 about. Now, the elegance with this process is that that subsequent material, which we would refer to as ripios, which is a technical term to refer to the material after it's been leached by heat bleach, could then - - - 35 COMMISSIONER: So contains copper, uranium, gold? MS McGILL: Uranium, and all the polymetallics. So we will have leached about 85% of the uranium out of that heap via a very long and slow process, 40 okay, which is - - - COMMISSIONER: It takes a year, I understand. MS McGILL: Yes. Up to a few years actually, by the time you prep the pad, 45


you do the irrigation and you neutralise the pad. So that process could then be, once we finished leaching it, we could recover that material and process it via our traditional flow sheet. It would essentially eliminate all of the high-intensity leaching processes, CDC circuit, that we have on the surface today and it would enable us to continue to produce copper cathode through to 5 a final product without the need to leach for more uranium out of the concentrate. So it actually recovers all of the uranium upfront, therefore opening up the flow sheet in the back end. Now, why that's significant is that simplifies any expansions we do the smelter, 10 because when you do that heat bleach it actually improves the overall copper to sulphur ratio, which is important for the smelting technology that we apply at Olympic Dam. Now, the economics of this project are very dependent on the performance of heat leach and around the variability potentially for the ore that will present itself to the processing. That is the process we are working on 15 now. So we are looking to refine and determine the overall economics of that to determine the best way forward for Olympic Dam. COMMISSIONER: How sensitive is the price of uranium, noting that it’s a by-product of this to your final decisions? 20 MS McGILL: Whilst it’s not immaterial, it is not a material component of the economics. COMMISSIONER: Okay. And in terms of volume, does that double the 25 output less? MS McGILL: It would depend on the scale at which we developed the heap leach. So it could be more, or it could be less or it could be the same. 30 COMMISSIONER: Sorry, you’re - - - MS McGILL: Really dependent on the rate at which we – the size of the pad. COMMISSIONER: Okay. And in terms of the timeframe for your 35 investigation? Is this - - - MS McGILL: Well it is still, as I said very much in the test work - - - COMMISSIONER: Mm’hm. 40 MS McGILL: - - - scale, even though the test work scale is quite sizeable but we’re probably looking upwards of five years before we make a final decision on the right technology to adapt. 45


COMMISSIONER: Okay. And in terms of tailings, does that increase proportionally the size of the tailing dams required, or is - - - MS McGILL: Well, again it would very much depend on the scale with which we applied it. It would perhaps change the nature of the tailings, if we were – 5 so right now, the majority of the tailings, or essentially all of the tailings would come from the intense hydrometallurgical leach process. COMMISSIONER: Yes. 10 MS McGILL: When we – so that is as a result of that, they’re relatively – so while we neutralise them to a degree, they’re relatively acidic in terms of when they’re deposited in to the tailings dam. If we were to eliminate that process and adopt the flow sheet that I described, that – those tailings would be more neutral. So you float at more of a neutral pH. So the nature of the tailings 15 would change but the volume would be very dependent on the scale, wouldn’t necessarily increase or decrease. COMMISSIONER: I presume the price of copper is the determinate in terms of the size of the activity? 20 MS McGILL: That’s very true. But also the cost that Olympic Dam incurs to process the material and our overall productivity. COMMISSIONER: Okay. If I could – he gets paid for this, I’ve got to do all 25 the work. That’s not exactly true. Can we move along, I want to understand your comment about regulation? Because clearly this is important. We’ve spoken with Heathgate this morning, in all of our miners, so I just want to get a sense of your comment about the duplication between the state and the federal legislation on this? Where you think improvements could be made to improve 30 the productivity of the mining operation? MS McGILL: Yes, certainly. So our submission was - - - COMMISSIONER: Perhaps you could start by just explaining – if you have it 35 - - - MS McGILL: Yes. COMMISSIONER: - - the sorts of planning processes that you need to go 40 through from a state perspective and also from - - - MS McGILL: I’m not sure - - - COMMISSIONER: - - - the federal - - - 45


MS McGILL: - - - I have that level of - - - COMMISSIONER: Okay. 5 MS McGILL: I mean I will – it’s part of the EPBC Act which - - - COMMISSIONER: Yes. MS McGILL: - - - is the federal Act, has a trigger, as soon as you mention 10 uranium - - - COMMISSIONER: Yes. MS McGILL: - - - it triggers significance, which requires review from the 15 federal level. And I guess our experience, we’ve operated Olympic Dam for a number of years, we believe that uranium mining and milling and processing, as we execute it and to the standards which are evident in society today, don’t warrant that level of over – increased oversight. They should put – you put through the same level of rigour and challenge as any other mining and milling 20 project is in Australia. So it’s the additional trigger if you like. Now a lot of good work has been done in terms of the overall assessment process, in terms of streamlining that but the approvals process still remains multi-faceted process for any uranium operation in Australia. So we go through the state and also the federal process. 25 COMMISSIONER: Because it’s - - - MS McGILL: Because it’s listed as – because it’s uranium. You know, if you have a mine that has low levels of uranium, and you don’t actively recover it, it 30 could still exist in your ore but because you’re not actively recovering it and the material would be considered as norm, natural radioactive materials, doesn’t trigger that threshold. So it’s a nuance but it does create a lot of administrative hurdles which you challenge whether they add a lot of value and security to the Australian public for how the mining activity is conducted. 35 COMMISSIONER: Is it a straight duplication of federal upon state, or state upon federal whichever way you want to look at it? Are we all doing the same things? 40 MS McGILL: There’s a lot of similarity in the process. I’m certainly not an expert, I wasn’t part of the approval process for Olympic Dam either through the expansion but my experience has been that when you trigger commonwealth and state, you go through a lot of the same stuff and have different signatories, different timescales and different timeframes. A lot of the 45


time the recommendations are very similar and sometimes they’re slightly different, depending on the perspective gained as part of that assessment process and approvals process. COMMISSIONER: We will follow that up with the state regulators clearly 5 but do you have a sense of the amount of effort required for these additional processes? MS McGILL: From - - - 10 COMMISSIONER: I’m not asking for a dollar sense but - - - MS McGILL: Yes. You know, time is money. COMMISSIONER: Yes. 15 MS McGILL: As we all know and whilst BHP Billiton is certainly resourced to be able to cope with that, the time burden is still significant. I guess I look at it from another perspective, I was a small player and trying to raise capital and there was – because it’s not just the time, it’s the uncertainty that having 20 duality of processes create in the minds of investors. So okay, we’ve passed - how many hurdles does a company actually have to pass before they get a successful project up and running? So we can manage, it takes additional time, I’ve seen it take months, not weeks in terms of the parallel processing required. 25 MR HANDSHIN: Could I ask, just on that topic of regulation and perhaps bringing it down to a state level, do you see any fragmentation of the regulatory process because of its division between the Department for State Development and the EPA? 30 MS McGILL: So I would draw you very significantly to our indenture and that really prescribes for Olympic Dam a framework that is – enables both the South Australian public and the government to have regulatory oversight of Olympic Dam but provides for us an aligned approach to our approval regulatory perspectives. 35 MR HANDSHIN: What do you mean by that? MS McGILL: So we work through the Olympic Dam taskforce - - - 40 MR HANDSHIN: Right. MS McGILL: - - - and whilst we interact, the EPA has quarterly visits to Olympic Dam; you know the processes with which we operate are governed by the Olympic Dam taskforce. 45


COMMISSIONER: I might just move on now to looking at your second recommendation which is the broader recommendation about the use of information. 5 MS McGILL: Mm. COMMISSIONER: And this is particularly relevant to BHP and all of those other small miners. In your recommendations you mention that improving access to the body of learnings from extraction and exploration in the uranium 10 sector is a means of cost effectively growing the sector. Can you just take us through what you had in mind with that particular recommendation? MS McGILL: Certainly, I will just find – so I make sure I work through all of the points. So there is the fascinating thing about the South Australian geology 15 is the very deep cover. COMMISSIONER: Mm’hm. MS McGILL: Which, you know basically mask the potential discovery of 20 resources in the region. There is – now when exploration is conducted, the data is handed back to the government and in fact that data provides a really valuable database and resource for prospective players to comb through, to evaluate. We believe though there is an area of opportunity for the South Australian government to really mine the data, to extrapolate more 25 information or potential insights about potential mineralisation and opportunities. You know, a number of my team have described that if we were actually able to map the crustal formation, enable to give us some insight to where – so you know, uranium is created from – so the uranium that’s being mined in South Australia is a mix of sedimentary and original deposits. So 30 when we say sedimentary, it means they’ve transported from somewhere. Now what is the mechanism for that transport? What is the pathway that those uranium minerals have gone on and how can you best help identify? So if you know how like the Beverley deposit was formed and its source gives you other methods of finding future Beverleys or future Olympic Dams, if you actually 35 understand: a) how they’re formed and b) how they could have been potentially transported, so there’s this intellectual property that exists or intellectual data set that exists within the state knowledge that could then be mined, actively developed and potentially on sold, if you like, to potential prospectors to create compelling cases for the teams to evaluate the data and potentially may find 40 more deposits of this scale and size that we’re thinking about. COMMISSIONER: So that I understand it when you do your analysis of Olympic Dam for instance that data then goes back to the state government? 45


MS McGILL: When the tenements are handed back all of that data gets handed back. After we’ve done the work there is a time frame with which the data is made available, but certainly at the completion if you hand back a tenement you hand back the data, which is really positive, that doesn’t occur in every state of Australia. 5 COMMISSIONER: It makes sense. Is BHP part of UNCOVER? MS McGILL: Yes. We’ve participated in a number of the surveys and workshops and summits and we’re a sponsor to the AMIRA project, which is 10 the unlocking Australia’s hidden mineral potential project, as well, so, yes, we have participated in UNCOVER. COMMISSIONER: How do you assess that performance which is designed really to better understand what’s underneath the South Australian cover? 15 MS McGILL: I think it’s making good progress. Unfortunately due to the scale of the state and the depth of the cover there’s still investment that needs to occur in terms of the seismic modelling, so there’s more data that needs to be added to that picture to liberate a lot of information, but early stages. When 20 you come to researching the fundamentals of the geology that is not a quick process. This is trying to understand the earth in a very deep form. MR HANDSHIN: How could the missing data, if I can put it that way, be efficiently collated? Would it be by way of government organisations 25 undertaking further research or do you see scope for commercial participation in that process? MS McGILL: I think the answer would be, yes, to both. I mean I think there’s certainly a level of fundamental work which is probably best done by 30 long term research bodies like universities or groups like AMIRA or linkages, grants through the ARC. Potential commercial interests could be explored, it really depends on the time scale with which they’d be prepared to look at it and what would be in it from a commercial routine perspective. 35 MR HANDSHIN: One of the other programs that has been discussed in the course of some of the evidence today is the PACE program, the planning for accelerated exploration program. MS McGILL: Yes. 40 MR HANDSHIN: Do you have any views on the effectiveness of that program in encouraging exploration within the state? MS McGILL: I guess I’m not really in a position to discuss that to any degree 45


from BHP Billiton. I’ve heard positive things about it. From our perspective we’re driven more by internal motivations in terms of scale and the size of the resources on our horizon. MR HANDSHIN: For junior or smaller operators it seems to be the case that 5 there are some significant barriers to entry into the sector, namely the costs of exploration. Do you see any ways in which, from the perspective of those junior operators, they might be assisted in taking the steps and embarking on a course of exploration? 10 MS McGILL: It would be all about how you can simplify the process and how you can ensure that also that you protect state interests and public interests as well, so I think there’s a happy medium to be achieved in terms of regulatory response and control. Again it’s very much dependant on how the potential for the state to unlock the - which I think is a true issue, which is the 15 level of – the majority of the deposits like Olympic Dam are called iron ore-copper-gold. They are actually all iron ore-copper-gold-uranium deposits, the uranium being a variable quantity. Now, the ability for players to find and discover certainly regulatory frame works, improving the process, access to data and improving those data sets is really important, but then it comes to 20 what are the barriers to actually creating an operating mine, which is very much around unlocking how those players would treat the subsequent concentrates produced from those operations, so not all of them will be at the OZ Minerals level where there’s negligible levels of uranium. A lot of them will have increased levels of uranium which will require processing prior to 25 sale or further production and that really, if I was to look at it from a – exploration is one part of the story, but the big part of the story which would create jobs is really around how you would unlock that deposit through an operating mine and that to me is the barrier to entry that most juniors would come against. 30 MR HANDSHIN: That being a primarily capital intensive barrier. MS McGILL: That’s right. 35 COMMISSIONER: We might move on. One of the other parts of our terms of reference talks about safety and I’m particularly interested in the regime that BHP uses in the uranium part of the business and how it protects its workforce, the process that it goes through. I wonder if you could give us just a brief outline of the procedures and the processes that BHP use. 40 MS McGILL: Yes, I certainly will and I will say it’s been developed in conjunction with a number of world regulatory authorities, as well as state and federal authorities in terms of the right management plan for Olympic Dam. Our radiation management plan is reviewed and submitted to the state on an 45


annual basis which has transparency in terms of reporting, in terms of dosage levels and impacts, potential impacts. Our view is, and certainly the view of the industry worldwide, is to focus on the principle of ALARA, which is as low as reasonable achievable, and that really, if you like, doesn’t use the annual regulatory limit to establish the dose we allow our people to have, but it takes a 5 look at it, so how low can we reasonably get it, so the annual regulatory limit for dosage in terms of millisieverts is 20 millisieverts per annum. We do not meet – we’re about 40 per cent of those. Our maximum value in terms of our radiation dose over the life of a – certainly for the last number of years is about 40 per cent of that and that is the basis which we manage our radiation 10 exposure, so we effectively measure the different causal pathways which people would be exposed to radiation, so you have gamma dose which we measure and monitor, radon decay product dose which is primarily received underground as a release of radon and in the decay products from the radon gas and then there’s also dust, in the dust dose that people can potentially - so we 15 measure the potential exposure via personal as well as area monitoring devices and we submit these results to the regulator set on an annual basis. We also provide transparency in reporting to our employees and we ensure there’s effective communication and education about the hazards associated with radiation and if I remember back in my history the first uranium mine I worked 20 at, and I came from a gold mine, and I walked in and I did a tour of the plant and I said, “What do I have to watch out for with radiation?” My boss looked at me, and I think it’s the best advice I can give anyone who goes to a uranium site, just have really good hygiene. Wash your hands and face before you eat and drink and sometimes it’s that simple advice that in fact provides the right 25 level of protection for our employees, so we have limits of where people can smoke, we have limits where people eat and drink and we ensure we have adequate hygiene facilities across our sites as well, so we apply really good practices in that regard. That, as well as the engineering controls that we have in place, as well as respiratory protection all provide a really good and safe 30 level of exposure in terms of the radiation dose well below the annual regulatory limit for the workers. COMMISSIONER: In terms of the line operation is there any requirement for face masks to be worn? 35 MS McGILL: There is depending on the area of activity, but the requirement for them is not particularly for radiation. COMMISSIONER: For dust. 40 MS McGILL: It’s for dust. It’s for diesel particulate matter, as well as potential exposure to dust from radioactive products. COMMISSIONER: But I’m assuming the safety requirements are just as stringent as if it were - - - 45


MS McGILL: Absolutely. In the packing shed we operate with positive pressure when the uranium ore concentrate is packed. If the people have to enter there they wear airstream helmets which are fully encapsulated helmets with a pump of fresh air through a filter. In other parts of the plant people wear 5 dust masks, in other parts of the plant that is more associated with the potential gases from the smelting process people wear respirators, so if you like we have a full gamut of respiratory protection, of which part of it is associated with managing radiation exposure but it also covers a very broad range of other potential risk factors in the workplace. 10 COMMISSIONER: And as I understand that, what you have described relates to the measures that you take to improve the safety of your workforce, what steps does BHP B take in relation to the broader community’s exposure to radiation coming from the site? 15 MS McGILL: Yes. Well, we also have a range of radiation monitoring that cover potential exposure for both the local community and the surrounding environment. And these controls are again, the information are captured and reported and part of our radiation monitoring plan. I mean this work is also, as 20 part of the EPA’s quarterly visit to site, they do a visit, as I said every quarter and they actually determine what it is they look at and review on that basis. COMMISSIONER: Do the tailings facilities, and in particular bearing in mind the arid conditions that generally prevail at Olympic Dam, do they 25 present any radioactive risk to nearby communities? MS McGILL: No, we have – see the way we control the risk presented by the tailings is in terms of radiation exposure to the community, there is quite a few but first and foremost, at 50 metres away from the tailings there is no gamma 30 dose. Okay. So your best engineering control is separation and the location of the tailings facility at Olympic Dam is not near any local community. The town is on the other side. We also ensure that the tailings, when they are being deposited and when they are being stored actually have a level of water cover over them, which minimises the dust removal. But we also have active 35 monitoring, as I said, on the tailings storage facilities as well as the Olympic Dam site to manage the level of exposure. MR HANDSHIN: Perhaps whilst we are on the topic of tailings we could deal with what risks have been identified in relation to the tailings storage facilities 40 at Olympic Dam and what steps have been taken to minimise those risks? MS McGILL: Certainly. We believe there’s four main risks associated with the storage of tailings at Olympic Dam. First is embankment stability, so they are dams. They have walls. So ensuring the integrity of those walls to 45


minimise the risk of unplanned release of tailings as a result of the embankment failure. There is also potential for seepage. We monitor this and ensure that seepage is controlled and the impact on the environment is minimised through seepage collection activities. We also monitor the level and the potential interaction of the groundwater with any potential seepage. And 5 we have maintained a distance between the groundwater level and our tailings seepage to the degree that there’s been no interaction between those. The other impact is the fauna interaction, particularly avian fauna but as well as terrestrial fauna. So the potential risk. We are in an arid climate; bodies of water of any kind attract wildlife. On the ponds, we do have fences around the ponds and 10 we implement a number of bird scaring and noise and sound and light to minimise the impact of avian interaction on the tailings. There’s also the risk of spillage. We transport the tailings from the plant through to the tailings dam and there is a potential for the pipes to fail. Those – and we manage that risk by having a bund around that pipeline to ensure any leaks are captured and 15 effectively remediated on that basis. COMMISSIONER: Is there likely to be any difference in the approach to tailings if the expansion of Olympic Dam proceeded? 20 MS McGILL: If the flow sheet remains the same, then the tailings approach will be the same. If the flow sheet changes, deposition method will probably be very similar but there may be less or fewer need for I guess, concerns around exposure to – in terms of it won’t be as acidic, so the acid concentration or the pH of the water will be less aggressive than perhaps it is today. 25 MR HANDSHIN: If the flow charge were to remain the same, are the current tailings storage facilities adequate to accommodate an expansion, or would you need to build new ones? 30 MS McGILL: No, and as part of our environmental management plan, we regularly apply and continue to extend – raise the heights of our dams, increase our overall storage capacity. So we don’t – it doesn’t – it’s never ending, you have to continue to grow to develop them. So if there was expanded along the current flow sheet, there would be a need for an expanded tailings facility. 35 MR HANDSHIN: What are the heights at the moment? MS McGILL: The maximum height that we’re going to is 40 metres. 40 MR HANDSHIN: Right. And where are they currently at in terms of - - - MS McGILL: So, 30. MR HANDSHIN: Right. 45


MS McGILL: Thirty. MR HANDSHIN: Okay. Could I just go back to a couple of the matters that you raised a moment ago, in relation to the tailings facility and you mentioned, 5 as part of your first point, the embankment stability and in particular the integrity of walls. What do you do in that sense to ameliorate the risk? What engineering or other controls have you got in place? MS McGILL: Well, first and foremost they have to be designed to the 10 appropriate standard and in fact it’s that compliance to design and construction which is paramount in ensuring the stability of the dam. We also manage the level of water sitting on the top of the pond. You do that to ensure that you don’t get erosion of the walls with the lapping and the action of the water. So we monitor and maintain that. We also, as we’re depositing the tailings, 15 maintain a maximum rate of growth increase. So you do it in a very staged way. So the maximum rate of tailings in the dam was two metres per annum. So that it’s done, allowed to dry, stabilise and then you continue to grow over time. 20 MR HANDSHIN: Can I just interrupt you there and ask you - - - MS McGILL: Yes. MR HANDSHIN: - - - how that particular control measure works with natural 25 rainfall events? Have you got built in tolerances to deal with those kinds of scenarios? MS McGILL: We do. We actively model rainfall and the potential impacts of extreme rainfall events to ensure that we have adequate water storage facilities 30 to manage that process. Yes. COMMISSIONER: When it hasn’t worked, when there has been spillages from the tailing dams - - - 35 MS McGILL: Mm. COMMISSIONER: - - - I assume that there have been - - - MS McGILL: We have had leaks on the line and on the embankment and there 40 has been incidents where seepage has been detected but there hasn’t been wall failures to my knowledge. COMMISSIONER: Okay. What have you learnt from those processes? Is it a question about engineering the walls, or have you learnt - - - 45


MS McGILL: Well, certainly from the pipeline perspective, it’s about maintenance strategies and ensuring the acid integrity is of the right standard. COMMISSIONER: Yes. 5 MS McGILL: As technology continues and improves and we have more real time monitoring which will give us early warning, so of potential leaks - - - COMMISSIONER: Right. 10 MS McGILL: - - - and issues that we can actively remediate them, that’s a reactive mode. In a planning mode we actively condition monitor the state of those lines to ensure that they’re the right standard and we have, in terms of seepage, we actively monitor the points where we know and we’ve modelled 15 there could be potential issues and we actively establish what the monitoring programme, if we see any areas of concern will increase the frequency and the monitoring of those processes. We also have the ability to – because we have got a few tailings dams, we can move between one to another if we need to manage that. 20 COMMISSIONER: And is this a recent occurrence, or is this something in the past? MS McGILL: What? 25 COMMISSIONER: Problems with the tailing facility? What - - - MS McGILL: So - - - 30 COMMISSIONER: Seepage or? MS McGILL: So the nature of the tailings facilities is that the lines are carrying an aggressive – it’s like pumping sand. So you will get wear on the tailings lines. The seepage is an issue that we’re actively monitoring; it hasn’t 35 been a particular issue, we’ve never had interaction with groundwater, it’s just one of the operating parameters which you’re aware of when you operate a tailings facility. COMMISSIONER: Okay. The groundwater - - - 40 MS McGILL: Mm’hm. COMMISSIONER: - - - what’s the quality? I probably should know this? 45


MS McGILL: It’s quite brackish. COMMISSIONER: It is quite brackish. MS McGILL: Yes. 5 COMMISSIONER: Okay. MR HANDSHIN: What’s the mechanism through which the seepage is – or the seepage risk is monitored? 10 MS McGILL: Mm’hm. MR HANDSHIN: What’s the actual mechanism? What do you do? Is it onsite inspections? Are there - - - 15 MS McGILL: So we have – yes, so we have onsite inspections, we have regulatory checks by the EPA, as I mentioned. At our pre-discussion, the EPA was actually out at the TSF in May. So yes, it’s part of just a routine process that’s actively prescribed and controlled as part of our environmental 20 management plan. MR HANDSHIN: The use of liners in the tailings storage facilities, is that common to all of them? 25 MS McGILL: No, the liners are used in the ponds, rather than used in the dam. The dams are used with the clay and a geotech manufactured base. MR HANDSHIN: Okay. 30 MS McGILL: The tailings themselves would erode the liner. MR HANDSHIN: Right. MS McGILL: Okay? 35 MR HANDSHIN: So in the ponds, the liners are placed in the base of them in the centre? MS McGILL: No, the whole pond is lined. 40 MR HANDSHIN: The whole pond. MS McGILL: And then we have under-pond drainage to check if there's lead - we call it leak detection. It's a very fancy name for a pretty simple process. 45


MR HANDSHIN: The measures that you spoke about as deterrents to the local fauna, when were they introduced? And I'm thinking in particular about the bird-scaring devices you mentioned. 5 MS McGILL: I couldn't tell you the actual year, but they've been in place for a number of years. We in fact just implemented the random light disco out there. That's been more of a recent innovation, but we had the bird scarers and the guns - literally gas cannons for noise, not anything else. I'll just be very clear on that. But they've been in place for a number of years. You know, we 10 actively try to minimise the impact, yes. MR HANDSHIN: Some materials that have been received by the Commission express concerns with a number of bird deaths, particularly earlier in the 2000s. Have you seen a progressive decline in the number of bird deaths since all 15 these measures have been adopted? MS McGILL: Yes, we have, yes, over a period of time, and that information is available from the environmental management plan as well. 20 COMMISSIONER: Can I go back to the expansion to get a sense of the time frame and how sensitive that is to commodity price? MS McGILL: Very sensitive. 25 COMMISSIONER: So if there was a return to perhaps more buoyant commodity prices, there's a potential to accelerate this process? MS McGILL: The constraint really would be solving the technological risks associated with the processing. There's only so much you can speed up. So 30 there would be some acceleration potentially, but it really will be dependent on the successful application of the technology. MR HANDSHIN: In relation to the heat bleaching trial, have you identified any potential environmental risks from the use of that process, and if so, what 35 are they and how are they being dealt with? MS McGILL: I think as we step through in terms of scale, there will be opportunities to ensure that we have adequate levels of protection. The heaps are quite large, potential for dust lift from the pads - - - 40 COMMISSIONER: Can I interrupt? I do understand what a heap is. MS McGILL: Yes? 45


COMMISSIONER: So is this just a concrete pad with a hole? MS McGILL: What you usually do is you do multiple liner. So you put a rubber base down, a polyurethane base. You put collection points in to collect the liquor. So you would put, like, drainage down underneath the pad, and then 5 you would stack ore that's crushed to around 8 millimetres, slightly agglomerated, so you would put - it would sort of like the mix from cement before you added lots of liquor. So it would look like the reo - that sort of material. And then you would stack it on a heap. Now, these heaps - probably the best scale I could refer to you is our operation in Escondida where we 10 operate these facilities and have, you know, over 20 years. These heaps can go through a stage of multiple lifts. They can be up to 30 to 40 metres high. They could be kilometres long. And what you do is you basically use, like, a sprinkler system over the top of that rock that you stacked 15 and slowly drip - drippers, if you like, that you put under your tree, your almond tree. You would drip that material down through the ore. The solution would collect in that collection pond at the base and you would pump that liquor through to the plant to recover it by a solvent extraction. 20 COMMISSIONER: And presumably what you don’t use gets pumped back. MS McGILL: Yes. It's a very elegant process. You recover the uranium. That liquor then goes back into the heap in a circulation process. So you don’t actually exist the liquor. You just keep recirculating it after you've removed 25 the uranium. MR HANDSHIN: And what is it that's applied to the heaps to facilitate the percolation? 30 MS McGILL: An acid solution, a weak acid solution. So it would be like lemon juice, 1.8 pH. MR HANDSHIN: What is the acid that's used? 35 MS McGILL: Sulphuric acid. MR HANDSHIN: Is it apply by drippers or is it sprayed on by some other means? 40 MS McGILL: Drippers mostly, because evaporation is a real problem, particularly in an arid climate like that. Yes. MR HANDSHIN: Given the use of the pads at the base of the piles and the other drainage facilities that you referred to, do you contemplate that there 45


might be a risk of the contamination of the subterranean surface? MS McGILL: There would be always a risk. It's how you engineer and ensure those risks aren't delivered on. As I said, these operations have operated really successfully and quite safely. Where there's been excursions that is 5 around failures of the engineering controls and potentially, you know, massive rainfall events that the sites were not capable of managing. So you'd have to be sure you had the right level of pond storage, that your water balance was correct, and that you had the right monitoring under the base of the liners to ensure that you didn't have leaks. 10 MR HANDSHIN: At the moment are leach tanks used for this part of the process? MS McGILL: That's right. 15 MR HANDSHIN: And again, and to the extent that you can comment on it, would those leach tanks still be used in the event that you went to a heat bleaching style of operation? 20 MS McGILL: No. MR HANDSHIN: They would be completely circumvented. MS McGILL: Yes. 25 MR HANDSHIN: Can we perhaps move on to another topic, Ms McGill, and that is site remediation and closure, particularly in the context it's being consideration, namely, an expansion of mining activities. Are you able to give us some information on what is currently required, what closure plan BHPB 30 has, and in particular how that accommodates the tailings storage facilities over the long term? MS McGILL: Okay. So I'll talk firstly about the BHP Billiton process for managing closure. Part of our annual planning process requires that we update 35 our closure plan and we make full financial provisionings to ensure that complete closure is captured in our financial models. As I said, this is done annually. We also have an internal audit process where people external to Olympic Dam attend Olympic Dam and verify the levels of closure provisioning and the closure requirements that we captured. 40 COMMISSIONER: Who are those people? MS McGILL: So they're from BHP Billiton group or they might be people external to Olympic Dam - - - 45


COMMISSIONER: To your - - - MS McGILL: My unit operation, a more global perspective. We also have an annual audit done by KPMG, which includes the scope - the scope of the 5 closure planning is also included to ensure that we meet those closure provisioning. Now, in 2011, when we apply for major development approval for the open pit expansion and our EMP, we also submitted to the State government for its review a copy of our closure plan as associated with the approval, and the indenture minister can request a closure plan at any time. 10 The closure plan that we submit to the State government doesn't include detailed financial information. So they're all the requirements that we comply with. Most of those requirements are done on the base of our internal controls and ensuring that we 15 are financially viable to cover all of the requirements with closure, as well as any State requirements as described by the State. COMMISSIONER: So that provision is on BHP books? It's not money actually seconded to the State or Territory? 20 MS McGILL: No, that's right. I referred to the Indenture Act. It applies for Olympic Dam. COMMISSIONER: Presumably that's a provision that would be available for 25 review on BHP's annual accounts, the extent of which - - - MS McGILL: Excuse me, I'm not - - - MS ..........: (indistinct) be - - - 30 COMMISSIONER: The quantum. MS ..........: - - - valuable? The quantum. So - - - 35 COMMISSIONER: The quantum for the provision, I am assuming, would be separately identified on BHP's financial statements. MS ..........: Correct, yes. 40 COMMISSIONER: So individuals who would want to see what the extent of the provision - - - MS ..........: I would assume so. 45


COMMISSIONER: I'm not expecting you to have that off the top of your head. MS ..........: I'm sorry, your Honour. 5 MS McGILL: I mean, a scale the size BHP Billiton, whether it's truly able to be - this is Olympic Dam. MS ..........: I think it's - - - 10 MS McGILL: Certainly the overall provision - - - MS ..........: Consolidated (indistinct) MS McGILL: - - - consolidated there would be available, but would it apply 15 to the majority of our operations rather than specifically Olympic Dam? COMMISSIONER: Yes. That might be a question we ask later on. MS McGILL: Okay. 20 MR HANDSHIN: The only other question that I have in relation to site remediation and closure concern what would actually happen to the plant at the Olympic Dam site in the event of closure? Is that something that's dealt with in the closure plan? 25 MS McGILL: It would be. I don’t have detail right now because - - - MR HANDSHIN: Can I just raise one more matter if that's - - - 30 COMMISSIONER: Of course. MR HANDSHIN: It just relates to the topic of water consumption. In the event that heat bleaching were to form part of your operations, would that have any material effect on the site's daily consumption of water? 35 MS McGILL: It's certainly a key component of what we would review in terms of the viability of the project, but I wouldn't assume it would essentially use more. It would depend on the scale of the operation. To give you an example, you know, in any tank it's 50% water. In a heat bleach you're 40 trickling it through a stockpile. So it doesn't necessarily consume more water than our current unit processes. COMMISSIONER: Thank you very much for your evidence. We'll adjourn at 1450. 45


MATTER ADJOURNED AT 2.50 PM UNTIL THURSDAY, 15 OCTOBER 2015


sa nuclear fuel cycle royal commission mr kevin...

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