VANCOUVER — So far, the holiday season has not been very merry for Taseko Mines (TKO-T, TGB-X), which is facing a potential strike at its operating mine and a new setback in the seemingly endless effort to permit its new mine.
The latest issue arose Wednesday morning, when workers at the company's flagship Gibraltar mine in central B.C. issued a 72-hour strike notice. In announcing the news, Taseko said it is firmly committed to negotiating a new contract with the Canadian Auto Workers Union, which represents Gibraltar workers, and avoiding any strike action.
The potential for a strike at Gibraltar adds to Taseko's growing pile of problems, most of which relate to the company's New Prosperity project. New Prosperity is a copper-gold deposit 120 km southwest of Williams Lake that Taseko wants to develop into an open pit mine, but the process to permit that development has encountered one obstacle after another.
The project name includes the word 'New' to distinguish the current development plan from the old one. Two years ago the federal government rejected Taseko's initial development application, primarily because the plan involved draining Fish Lake, a site that holds spiritual significance to the local Tsilhqot'in First Nation.
In September, Taseko submitted a new development plan for the US$1.1-billion project, one that would preserve Fish Lake by moving the tailings facility 2 km upstream.
That submission kicked off a 235-day countdown, which is the time frame within which the Canadian Environmental Assessment Agency (CEAA) has to finalize its response to Taseko's Environmental Impact Assessment (EIA). However, that countdown was suspended in late November when the CEAA halted its review citing a "major deficiency" in the EIA. The deficiency concerned Taseko's approach to assessing how the new plan impacted the mine's cumulative environmental impacts.
Taseko was none too pleased with the setback. In a letter to the CEAA, the company's senior vice-president of operations, John McManus, expressed disappointment and disagreement.
"It is discouraging that the panel has used an apparent technicality to stop the timeline remaining for the panel to complete its review," McManus wrote. "Taseko does not agree that there is a deficiency in the EIA related to the approach that was used…"
McManus argued that the original assessment found there were no significant adverse effects on vegetation, deer, moose and other wildlife, or surface and groundwater. Therefore, the company does not believe it is necessary to revisit those issues.
The panel responded with a letter of its own that simply repeated its statement that the cumulative effects assessment is deficient and its request for more information.
If that late November scenario was annoying for a company trying to speed up a process that has dragged on for years, what happened next must have been downright aggravating.
On December 10, the CEAA panel sent Taseko another letter. This time the panel asked for additional information on no fewer than 50 other aspects of the EIA submission, ranging from specific characteristics of acid rock drainage to mitigation for effects on grizzly bears.
Opponents of the project jumped on the letter, claiming the request showed that Taseko has failed to consider a multitude of potential impacts. For example, Chief Marilyn Baptiste of the Xeni Gwet'in First Nation wrote that "…the Panel and the governments have now said there are serious deficiencies in [Taseko's claims that it can save Fish Lake]. It seems to us that the company has put its efforts into pushing through a second proposal as fast as it can, without doing the homework to see if it can actually back up its proposal."
Taseko was quick to respond to such criticisms.
"Regrettably, project opponents were quick to misrepresent the Panel's request for more information, suggesting the project was unsound and/or that the project itself had been halted," wrote Brian Battison, Taseko's Vice-President of Corporate Affairs. "Information requests are an expected and routine part of any panel process."
Taseko is now working to respond to all of those requests for more information, which it must do before the countdown clock will restart, while also trying to negotiate a new contract with its employees at the Gibraltar mine. In the meantime, the company's share price, which had gained more than 25% in September after Taseko submitted the New Prosperity EIA, only to lose most of that gain over the next month, continues to trade sideways near the $2.90 mark.
It all makes for a busy – and not particularly merry – Christmas season for Taseko Mines.
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