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Jericho Mine in federal hands Executives at Shear Diamonds could be on the hook for fines and jail time
Lyndsay Herman
Northern News Services
Published Monday, July 15, 2013
KITIKMEOT
A federal program has taken on the role of project operator of the Jericho Mine while executives from former owner Shear Diamonds could be facing fines and jail time.
Shear Diamonds Corp. purchased the Jericho Mine from Tahera Diamond Corp. in 2010. - photo courtesy of Tahera Diamond Corporation |
Shear Diamond Corp. was Jericho's most recent operator, purchasing the ill-fated diamond mine in 2010 from Tahera Diamond Corp. which put the project on care and maintenance after running out of money.
Shear's initial optimism eventually dwindled, particularly once diamond prices softened last fall.
On Sept. 2 the company had vacated the site, according to an Inspector's Direction issued by Eva Paul, Kitikmeot region water resources officer for Aboriginal Affairs and Northern Development Canada, dated March 8.
The Contaminated Sites Program has taken on the role of Jericho's project operator, according to a letter from Aboriginal Affairs and Northern Development Canada to the Nunavut Water Board sent June 7.
The program will manage water during times of high water levels such as during the spring melt, tailings, fuel and hazardous waste, and officially close the site.
"This will serve to manage the risks to persons, property, or the environment until such time as the project's future becomes clear," stated Paul in the letter.
Paul's letter followed a document called an inspector's direction issued on March 8 and directed to Julie Lassonde of Shear Diamonds Ltd. and Shear Diamonds (Nunavut) Corp.
The direction detailed how Shear had failed to meet certain environmental protection measures, reporting requirements, and previous deadlines and required an action plan from Shear by March 30.
The document cited its legal teeth under the Nunavut Waters and Nunavut Surface Rights Tribunal Act, which states any person who contravenes an inspector's direction of this kind is "guilty of an offence and liable on summary conviction to a fine not exceeding $100,000 or to imprisonment for a term not exceeding one year, or to both."
Every day the direction is not complied with is considered a new offence under the Act.
Aboriginal Affairs and Northern Development Canada was unable to provide an interview or clarify before press deadline exactly who, if anybody, would be charged the fine or face prison time at Shear.
Lassonde was president and chief executive officer of Shear Diamonds Ltd. after the company's founder, Pamela Strand, stepped down from the position in March 2012.
Pamela Strand and David Prince each resigned from the company's board of directors along with chief financial officer Greg Powell, according to a news release issued by Shear on Nov. 15.
According to Mining Watch Canada, a non-profit organization advocating responsible mine policies and practices, the only thing Canada can do at the federal level is use the security bond Shear was required to pay to clean up Jericho, or find a buyer for the mine, "which is kind of putting the government in a strange position because they're not usually in the business of selling mines," Jamie Keen, communications coordinator for the organization, said.
"It's a bit of a sore point. It really emphasizes the need for financial security to be put up front in any of these operations."
As of April 4, Aboriginal Affairs and Northern Development Canada informed News/North Shear had paid $8.3 million in securities, but still owed more than $2.3 million.
The Nunavut Waters and Nunavut Surface Rights Tribunal Act states failure to pay the security without a reasonable excuse could also cost those responsible at Shear $100,000 in fines or imprisonment for up to one year, per day.
According to the act, Shear may be in debt to the federal government for any funds required to pay for clean up beyond the security bond.
The Nunavut Planning and Project Assessment gives the Nunavut Impact Review Board the ability to enforce provisions made in screening decisions and project certificates through fines and jail time.
The act is one of two passed in June under Bill C-47. It isn't likely to pertain to Jericho Mine, but could mean a clearer course of action for future problematic projects.
The act will come into force on a date yet to be decided by government in council, but is expected to be in force in about one year, according to an email to News/North from Ryan Barry, the executive director of the review board.
Even then, the provisions will not apply to Jericho unless an operator starts up the project after it has been in care and maintenance for at least five years. If an operator starts up the project before that time, the act will still not apply.
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