I THINK MINING

In early 1983 all was well in the mining consulting world.  We had twenty people busy on a great number of mining projects: exploration; resources; site selection; design; contract documents.  All those things we did back then: no EIS; no social responsibility; no sustainable development; and no closure planning.

Jimmy Carter was president.  Then he went to the mountain and told the nation that the lousy economy was all their fault.  And so the economy collapsed, mining and all.  The molybdenum mines were stopped; gold mines were cancelled; uranium mines tottered on.

Clients called daily.  Stop work they all said.  Over the course of three months, every project we were working on was cancelled.  We marketed hard. Trips to Calgary where the mining engineers barely hung on to their jobs.  They had hours to chat and were happy to chat for hours.  For they had nothing to do and no work for mere consultants.

I personally had to sign the dismissal letters to all twenty—myself and my boss included.  All were put on a contract where we were paid per hour if engaged in billable work.  There was no billable work, so we were all essentially unemployed & and unsalaried.

One lost his half-million dollar house in West Vancouver, his wife took to cleaning houses, and he eventually got a job as a professor in the USA.  One fell back on his church that supported & fed his five kids.  One (me) went back to South Africa for six months.   One started InfoMine by cutting & pasting stock exchange listings and selling them to desperate investors.

Those were tough times.    Regan and his eternal optimism won the election.  He took harsh but necessary measures and the economy improved, a bit.   I spent two years on the Cannon Mine, Wenatchee, Washington designing (as we went) and constructing (as we went) the tailings impoundment.   That mighty dam is now reclaimed and a testament to my belief that we can mine and disposed of tailings close to human habitation successfully—if only we do it right.

We took but a year to permit the mine and a 340-ft high tailings facility.  I have written extensively about it and there is much on the web, if you want to examine my thesis that in a short time it is possible to permit and build a responsible mine—although then we knew not the term.  We simply did what we knew was right.  And Syd Hillis and John Gadsby were my peer reviewers and they made sure we did things right.  They are my heroes and I will always recall their courage to demand the right thing be done.

Then, like so many others, I drifted to other things. I went to the UMTRA Project where we had to close 24 inactive uranium tailings pile to be stable for at least 1,000 years. I spent five years on that project, and published many papers and a book.  I learnt that you can close tailings facilities for the long term to protect the environment, if only you do it right.

Then to California and ten years on landfills.  Let us face it they are tough: close to people and houses; noxious; necessary; low-budget; and complex.  They are far more difficult to design, permit, build, operate, and close than any tailings facility I have faced.  Read more on the OII Landfill if you doubt me.  I have published on that too.

The point of this long recollection of times past is the news that I read today that WorleyParsons, a large consulting company to the mining industry is about to lay off staff as a result of a slump in demand for consulting services to the mining industry in Australia.  In part the report says:

The nation’s multi-billion-dollar resources investment boom has been losing momentum in recent months as commodity prices have declined on subdued global demand at a time when both mine construction and output costs are rising. This has pushed some miners to alter or defer plans for new projects until market conditions improve. “While overall employee numbers in WorleyParsons’ Australian business have increased over the past year, some isolated pockets of the business have been impacted by project activity resulting in the redeployment of staff onto other projects and some redundancies,” its spokesman said.  The company wouldn’t provide any further details ahead of its full-year earnings report, which is due tomorrow.

We wait to see how many are laid off.  It will be an interesting measure of just how bad things are becoming.

I sympathize with those who are about to lose their consulting jobs.  I know how difficult it is.  It will demand changes in their life-styles to say the least.  But that is consulting to mining: times are good and jobs are plentiful; times are bad and you are laid off.

We hope this news is not the first in a string of such bad news.  We hope this is but an isolated instance of a company that over-expanded.  We hope this is but the give and take of consulting with it high salaries but no guarantees.

Still I advise that if you are deeply interested in the course of mining fortunes and the success or failure of mining investment, that you keep a close eye on the employment situation at mining consulting firms.  They are, I suggest, the most sensitive measure of the near-term future of mining activity and profit.