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A Nova Scotia subsidiary of Australia’s St Barbara (SBM: ASX) is scrambling to pay off a C$79.9 million ($60 million) cleanup bill by next Tuesday for its closed Touquoy gold mine.

The company, Atlantic Mining, must submit the remaining C$38.7 million of a reclamation bond for the site in Moose River, about 175 km west of Halifax, even though it’s fighting the amount in Nova Scotia’s Supreme Court. The province’s environment ministry and a local environmental group say the cleanup regulations are needed to protect the low-lying province’s groundwater. The company says they are onerous, impractical and unattainable.

“If we are compelled to pay the bond, we will need to seek financial assistance from St Barbara and arrange funding accordingly,” Atlantic Mining CEO Andrew Strelein told The Northern Miner by phone this week. “Our goal is to engage in constructive dialogue with the government to establish practical guidelines and a feasible timeline for reclamation.”

The dispute questions who will bear the brunt of the cleanup costs of the closed mine, which Atlantic operated from 2017 to 2023. The court’s ruling will not only affect Atlantic’s future but could set a precedent for mine cleanups in the region. Strelein says the provincial minister of mines supports the company’s efforts and shares a commitment to what the CEO calls effective reclamation.

Environmental violations

The government declined to comment on the case, but Halifax-based Ecology Action Centre says St. Barbara has often tried to bend regulations to suit it at a cost to the environment. The company has been charged with 23 provincial and three federal violations of environmental laws, the centre said.

“Ecology Action Centre is concerned that the company will not meet any standards required of them, given their track record,” the centre’s Karen McKendry said in an emailed reply to questions. “There is also an outstanding condition of the mine’s environmental assessment approval from 2008 that has not been met yet – that the company will provide funds to the province to protect land near the mine for nature conservation purposes.”

Atlantic Mining is pushing to renegotiate the mine closure terms, seeking what it says is a more realistic and achievable agreement.

“The conditions imposed by the minister of environment are not only unrealistic but could potentially undermine the entire remediation process,” Strelein said. “It’s challenging to understand how we are expected to cooperate under these circumstances.”

March approval

The reclamation approval issued in March includes deadlines extending to 2028 and stringent water quality monitoring requirements. Atlantic Mining claims these terms are not only impractical but also ignore the site’s historical context.

In July, Environment Minister Tim Halman denied the company’s appeal, maintaining that the criteria were essential to protect Nova Scotia’s groundwater. Halman emphasized that the timelines were based on the company’s own submissions and warned of environmental risks associated with delays.

Strelein highlighted the financial strain of the current requirements and its commitment to reclamation.

“We are pioneering mine reclamation in Nova Scotia, and this quarter alone, we’re investing C$7 million into our reclamation efforts,” he said. “It’s frustrating to be accused of delaying tactics when we are fully committed to completing the work correctly and in a timely manner.”