Mining Rehabilitation Guarantees

Legislation requires that all mining operations within South Africa must make financial provision to guarantee the availability of sufficient funds to undertake rehabilitation and remediation of the adverse environmental impacts of mining activities both during the life of the mine and at closure. Traditionally, most mine owners have made use of a prescribed Trust, which is funded over the life expectancy of the mine. However, this type of funding structure does not make funds immediately available for the interim closure costs, which is also a regulatory requirement.

Guardrisk, through a structured solution housed either in a cell captive or a contingency policy, is able to provide mine owners with the required full value guarantee which is accepted by the Department of Mineral Resources.

Premium payments are comparable with the payments that would be made to a Trust. Ideally, this solution will allow the matching of the environmental rehabilitation liability against company assets over a period of time.

Key benefits

• Multi-year insurance programme.
• Guarantee with full capacity provided immediately at inception.
• Complies with all requirements of the Department of Mineral Resources.
• Annual, committed premiums (similar in value to those of the Trust).
• No risk of permanent overfunding.
• Building of insurance reserves for future rehabilitation.

Client Profile

Small to large mining houses with guarantee values in excess of R1mil.

Geography

Global