The economics of mine closure and what comes next

Mine closure is supported by extensive technical guidance, established frameworks and decades of industry experience. Even so, some questions continue to generate discussion as our understanding, expectations and operating context develop.

Many sit at the intersection of engineering, science, policy, risk, economics and competing stakeholder expectations. How they are approached can influence closure outcomes, investment decisions and the long-term future of mined land.

The ACG Mine Closure Conference provides an opportunity to compare experience, hear different perspectives and consider how similar issues are being approached in different parts of the world. As Chris Meikle observes, some of the most useful conversations come from seeing a familiar issue through a different lens.

These questions are not new, and there is no single answer to any of them. The perspectives below reflect some of the discussion around why they remain relevant and how approaches continue to develop.

How do we create value after mining?

By Dr. Chris Meikle

A common theme is how we define and create value once operations cease. That value can take many forms. It might be natural capital and nature-positive outcomes, lower operating and capital costs during closure, greater lender and insurer confidence for forward investments, reduced reputational exposure, or taking long-term risk and liability off the balance sheet.

Of course, stalled relinquishment has many causes. In some cases, owners genuinely want to relinquish land but are constrained by poorly defined future land uses, completion criteria that were never designed with relinquishment in mind, or regulatory uncertainty. However, there's also a narrow issue where there is a credible next use and a capable future owner but transfer still stalls because of residual liability concerns.

Redundant land holdings are a good example. Mining companies can continue to spend money on monitoring, maintenance, and chasing ever-moving goalposts, even where the land has another productive future. Sometimes there is a credible new owner with a viable proposal, who understands the residual risks, is prepared to accept responsibility for them and can manage them as part of redevelopment. In this case, we need to develop clearer pathways for transferring that land, and the responsibility that comes with it. But often, hesitation is a common. What if something happens in the future and it comes back to us as the former owner?

The concern is understandable, but it can leave sites in limbo for decades. The owner continues carrying the liability because there is limited confidence that a transfer will genuinely separate them from future risk, including reputational risk. The alternative can be worse. Sites are simply left long enough that corporate memory fades, companies change or disappear, ownership becomes unclear, and eventually responsibility falls to the State. The land can then stagnate for another generation.

Industry, government and regulators should all want these sites positioned for future success, rather than defaulting to the State or long-term stagnation. The real problem is the decades that can be lost between mining ending and the land finding its next use.

In those circumstances, if a credible new owner understands the risks, accepts them and has a practical plan to manage them, there is often no scientific or engineering reason why the land cannot transition to another use. The barriers are more often policy, liability, process and uncertainty about what might happen later.

How do we bring closure costs into decision-making earlier?

By Jeremy Collyard

One of the things we've seen through our work is that often closure cost estimates from planning through to execution are often significantly underestimated. A big reason for that is the purpose those cost estimates are being developed for.

Closure costing has traditionally been done for bonding and regulatory requirements, where the objective is often to establish a bond value that both the regulator and the client are comfortable with. That's a very different driver from developing a closure cost model that helps guide closure planning over the life of the asset. Simply stated, closure cost modelling is a key component of closure planning, not just the result of a closure plan.

Many of the tools used today were not designed for closure planning, adapting and reducing uncertainty over time, and ultimately producing a closure cost estimate that is accurate at the time of execution. They are designed and utilised for bonding. They serve their purpose well; however, that purpose is limited. This is where a closure cost model is needed to serve the purpose of planning.

What we're trying to do is shift the focus of closure costing to support planning, identifying risks and opportunities, and, to do so, developing closure cost models focused on uncertainty and risk. We work with clients to develop closure cost models, SLR has developed a closure cost model that is being utilised globally to serve this purpose. The goal isn't necessarily to arrive at the lowest number or the most efficient bond or even a highly accurate cost estimate (AACE class 2 or 3 versus class 5). The goal is to identify where the uncertainty sits, understand what drives it, and determine what actions will reduce it over time. This is the fundamental difference between closure cost estimating and closure cost modelling and why SLR has developed the tools and the process that we have integrated into our closure planning programs.

To support that approach, we've developed tools that identify uncertainty not only by facility but also by activity. As we're building closure plans and cost models, our intent isn't to produce a bond value. It's to identify what's driving risk and what needs to happen next to reduce uncertainty.

Closure cost models not only allow for the identification of risks and uncertainties but also identify the facilities or activities that influence the closure cost estimate the most, allowing our clients to focus on the appropriate next steps. A good example of this is a closure activity that has little impact on the cost, such as a seed mix for revegetation. There can be a high level of uncertainty for that unit rate; however, the impact is minimal. On the other hand, activities such as the availability and location of cover materials can have a significant impact and represent a greater risk at a lesser level of uncertainty. So, a good closure cost model not only identifies risk and uncertainty for facilities and activities, but it also allows our clients to determine the most effective path forward to achieve the goal of an accurate closure cost estimate at the time of execution.

The recommendations that come out of the process aren't necessarily about refining the estimate itself. They're about improving the closure plan. Do we need more confidence in cover material availability? Do we need a better understanding of fleet requirements, scheduling or construction methodology? Those are the things that reduce uncertainty over time.

Sometimes that planning-focused estimate is very different from the bonding estimate. We often run both exercises, and they can produce very different numbers. Regulators may be satisfied with the bond value, and clients may be comfortable with it, but at the same time they need a realistic understanding of the closure challenge they're ultimately working towards.

How do we design landforms that remain stable long after operations cease?

By Elysśa De Carli

I approach that question from a geomorphic perspective. In mine closure, I've noticed a shift away from designing landforms to be simply geotechnically stable towards designing landforms that are geomorphically stable, designing with the land in mind. That means using underlying geomorphic principles and natural analogues to guide how we think about designing mining landforms and how these are expected to evolve over time.

The premise behind that approach is that erosion is a key driver of landform evolution. Obviously, we don't want mining landforms to erode to the point where underlying materials are exposed or environmental risks are created, but there needs to be an appreciation that some erosion will occur and that realistically this can and should be considered an acceptable process.

In some cases, erosion can actually be beneficial. It generates sediment, and when that sediment accumulates in certain areas, it can create conditions that support vegetation establishment and growth. Ultimately, rehabilitation through vegetation colonisation is what we're trying to achieve.

The challenge is understanding what constitutes an acceptable level of erosion. That's still a significant question for the industry and one that doesn't yet have a simple answer.

I think there also needs to be greater recognition that some erosion processes, such as gullying, can self-stabilise over decadal timescales. Stability can still be achieved, but perhaps not in the way we've traditionally defined it.

For me, a key discussion is how we reframe what we consider to be a safe, stable and non-polluting landform. If we acknowledge that some erosion is both inevitable and potentially acceptable, then we need to rethink how those outcomes are assessed.

Different questions, same reality

How do we create value after mining? How do we bring closure costs into decision-making earlier? How do we design landforms that remain stable long after operations cease?

They are very different questions, yet each highlights the same reality, successful closure depends on decisions made well before a site reaches the end of its operational life and requires a multi-disciplinary approach.

The discussion is no longer simply about achieving closure objectives and is increasingly about reducing uncertainty, clarifying future responsibilities, and creating outcomes that remain practical, resilient, and fit for purpose decades into the future.

The questions explored here do not have universal answers, but they continue to shape how the industry thinks about closure and what comes next.

How SLR can help

SLR supports mining clients across the full asset lifecycle, from early planning through to closure implementation, relinquishment and future land use planning.

Our specialists work across closure planning, closure cost modelling, landform design, rehabilitation, geochemistry, tailings management, and stakeholder engagement, helping clients address challenges through integrated, practical solutions.