Faro Mine Remediation Project - A Risk-Based Approach to Work Planning -

April, 2016

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Faro Mine Site Background • History

• Site Overview • Conceptual Closure Plan

• Remediation Schedule Faro Mine Site Project Challenges

Faro Mine Site Risk-Based Work Plan • Degrading Site Conditions (North Fork Rose Creek)

• Engineering Risk (Down Valley Hydraulic Upgrades) Next Steps

Agenda

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Timeline Faro Mine Site History

1969-1998 OPERATION - Open pit mine produced lead and zinc 1998 RECEIVERSHIP - Last operator (Anvil Range Mining Corporation) went into

receivership and Deloitte and Touche court -appointed Interim Receiver.

2003 DEVOLUTION - Authority to manage public lands and resources, including abandoned mine sites, was transferred to the Government of Yukon (YG).

-INAC maintained liability and responsibility for funding the remediation of the Faro Mine; YG took over administration and control of land and water -The First Nations identified as having been most affected by the mine are the Ross River Dena Council, Liard First Nation, Kaska Dena Council and Selkirk First Nation

2006 OBJECTIVES – All three parties agree on Closure Objectives for the Faro Site. 1. Protect human health and safety 2. Protect and, to the extent practicable, restore the environment including land, air, water, fish and wildlife 3. Return the mine site to an acceptable state of use that reflects pre-mining land use where practicable 4. Maximize local and Yukon socio-economic benefits 5. Manage long-term site risk in a cost-effective manner.

2009 CONCEPTUAL CLOSURE PLAN - All three parties agree to the preferred closure options.

Faro Mine Site History

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Faro Mine Site Overview

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•  Capture Acid Rock Drainage Seepage/Runoff •  Upgrade Surface Water Diversions

Water Management

•  Upgrade Dams and Spillways •  Stabilize Open Pit Wall

Dams and Impoundments

•  Regrade and Cover Tailings •  Regrade and/or Cover Waste Rock

Tailings and Waste Rock

•  Demolition of Infrastructure •  Remediate Contaminated Soil

Other

Faro Mine Site Conceptual Closure Plan

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Phase 1 Project

Assessment

Phase 2 Project

Definition

Phase 3 Project

Implementation

Phase 4 Monitoring and Maintenance

1998 – 2008 2009 – 2024 2024 – 2039 2039 –

• Site Assessment • Care and Maintenance

• Identify Remediation Approach

• Conceptual Closure Plan

• Interim Remediation Work

• Regulatory Approvals

• Full-Site Remediation

• Post-Remediation Adaptation

• Care and Maintenance

• Water Treatment • Long-Term Monitoring

• Care & Maintenance

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All funding provided by the Federal Contaminated Sites Action Plan

Faro Mine Site Remediation Schedule

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In October 2013, elevated level of zinc was discovered through ongoing routine monitoring

The project drills seven wells at the toe of the Intermediate Waste Rock to try and find the source of the seep.

The project drills ten additional wells upstream of the Rock Drain to try and find the source of the seep.

Newly constructed Seepage Interception System commences operation.

October 2013

March 2014

July 2014

January 2015

Faro Mine Site Project Challenges

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Faro Mine Site Risk-Based Work Plan

•  Participants: –  INAC & Yukon Government –  Independent Peer Review Panel

•  Constraints: –  Limited funding and timing ($225M over 4 years)

•  Methodology: –  Consequence (Environmental, Special Considerations,

Legal, Costs, Community/Media Reputation, Human Health & Safety)

–  Severity (Low, Minor, Moderate, Major, Critical) –  Likelihood (Almost Certain, Likely, Possible, Unlikely,

Very Unlikely)

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Faro Mine Site Risk-Based Work Plan

•  Conceptual Closure Plan: –  Divided into 10 sub-projects

•  The Scenario: –  (sub-project #1) won’t be completed until (year) and,

recognizing the ongoing deterioration of site conditions, results in additional significant impact on a valued ecosystem component.

•  Lessons Learned: –  Ensure the right people are involved in the process –  Clearly articulate all constraints, assumptions, decisions –  No such things as too much information! –  Challenge all assumptions (no ‘status quo’ option).

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Faro Mine Site Risk-Based Work Plan

Work Package   Risk   Notes 10a North Fork Rose Creek Diversion   Very High   Implement!

1 Water Treatment Plant   High   Mitigation Plan 8 Waste Rock High   Linked to 10a 2 Infrastructure Upgrades   Moderately High   Assess Risk

10b Faro Creek Diversions   Moderately High   Mitigation Plan 7 Tailings Moderate   Down

Valley Hydraulic Upgrades

9a Cross Valley Dam   Moderate  9b Intermediate Dam   Moderate  10c Rose Creek Diversion   Moderate  3 Building Demolition Low   n/a 4 Emergency Tailings Area   Low   n/a 5 Cross Valley Dam Seepage System Low   n/a 6 Surface Water Management   Low   n/a

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Deteriorating Site Conditions - North Fork

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Rose Creek Diversion Channel

Intermediate Dam

Spillway

Engineering Risk – Down Valley

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•  Design: –  North Fork Rose Creek Diversion (2016) –  Down Valley Hydraulic Upgrades (2016-2017) –  Closure Plan (2016-2017)

•  Regulatory: –  Closure Plan (2018-2020)

•  Implement: –  North Fork Rose Creek Diversion (2017-2019) –  Down Valley Hydraulic Upgrades (2018-2019) –  Closure Plan (2021+)

Next Steps