Swedish government proposals for safety on finishing costs for mining operations will be costly for the operators, says Foyen Law Firm.
The Swedish government decided on June 1, 2017, to instruct a particular investigator to investigate and analyze possible actions or measures that, in a more effective way than today, can ensure that there is sufficient collateral for finishing and other restoration measures in mining operations. The investigation took the name of the Mining Fund Financing Survey and was handed over to the City Council Karolina Skog in June 2018 in the form of (SOU 2018: 59).
The Environmental Code now contains general provisions for the lodging of safety at, for example, environmentally hazardous activities. The provisions also include after-treatment due to the mining operations, security is given to the state.
In order not to the state and ultimately taxpayers will be forced to bear the cost of finishing in case a mining company eg. goes bankrupt and the collateral is under-dimensional, the investigation has looked at alternative ways of providing collateral that is better in line with what it means to be the actual finishing costs incurred in mining operations.
The investigation proposes that changes be made to the Environmental Code and the Mineral Act and that a new law on financial collateral for mining activities with associated regulations is introduced. The investigation has identified what is considered to be four key areas for reducing the state's risk of post-treatment of mining operations.
According to today's system, the safety of the Land and Environmental Court is examined when applying for a permit under the Environmental Code. The investigation is of the opinion that this implies an excessively fragmented authority responsibility. The Land and Environmental Court makes decisions regarding both size and form of safety and the state is often represented in these contexts by the Swedish Environmental Protection Agency or any of the relevant county administrative boards, which lack the specialist competence in the field. This, according to the investigation, weakens the state's ability to protect its interests.
The investigation, therefore, proposes that the Swedish Environmental Protection Agency be relieved of the task of deciding on the size of the collateral and that this task is submitted to the Debt Office, which will be the supervisory authority for the financial collateral in the mining waste financing system. The review of the after-treatment plan is proposed by the Land and Environmental Court to renew or change the permit for mining according to the Environmental Code and by the County Administrative Board for revisions.
