About a month ago Glencairn announced the failure of the heap leach pad at their Bellavisa Mine in Costa Rica. I commented on it at this link. The essence of the report was that the heap leach pad was moving one centimeter a day, possibly tearing the liner, possibly leaking cyanide, and they did not know what to do.
Today I read this (edited) report:
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Glencairn Gold Corp. shares were trading near a six-year low, a day after the company warned that its Bellavista mine in Costa Rica may remain closed indefinitely and that the Toronto-based company needs cash urgently. All mining and leaching operations at the gold heap leach mine in Costa Rica were suspended last month after ground movements raised concerns about risk of a cyanide spill. The company said last month that massive ground movements – first noticed in May – had caused cracks at two corners of a leach pad which contains cyanide used to dissolve gold from crushed ore.
This story is fraught with questions. The technical parts simply do not hang together. As the first reported indicated, the rate of movements clearly gives reason to be concerned about the integrity of the liner, which if breached and torn would let seepage from the pad pass to the ground beneath and presumably the groundwater. Suspending all operations won’t do a thing to address the problem. Good that they have stopped applying cyanide, but that won’t stop what is in the heap leach pad getting out.
Presumably in the period between the first and second report, they completed a “full technical analysis” and decided to “close indefinitely.” Not that the second report tells us much: only that there are cracks at two corners. Funny but the corners of piles of rock tend to be the most stable part of piles. If you look at the three-dimension geometry, the corners are the parts with the flattest slope inclinations. Makes me wonder what other problems and deficiencies there are in this heap leach pad.
They are still “expending every effort to find a permanent solution.” I do not know the mine or the site, but the obvious solutions include: a berm to stabilize the sliding mass; toe drains to dewater the perched water table in the heap; vertical dewatering wells from the top of the pad; a layer of plastic over the pad to limit further ingress of rainwater; removal of material from the crest of the slope to lighten the load on the failing mass.
I cannot understand how company can spend a month studying a failing heap leach pad that could well be polluting the mine site and beyond, and then issue a casual statement that they will probably never restart mining. No information about what they have done, what the problem is, what the long-term environmental impact is or what it will cost to clean up the mess: polluted groundwater; impacted surface water; failed masses of cyanide-saturated rock; and so on.
I normally do not have the insight or courage to offer investment advice. I had better refrain right now—but my advice is pretty obvious from this blog posting: sell your shares, or at least do not buy more, until you get some honest technical information.
A fuller report and collation of this posting and previous postings is available at this link.
