Sebastián Urresta, Renato Urresta and Casey Luongo

ABSTRACT 

Natural resource extraction gave rise to the concepts of “boom-town”, and “bust-town” and their important implications for mining operations. Characterized by a period of economic prosperity followed by a depression, these terms represent the risks of mining-driven community development. Today, mining companies are beginning to plan and manage these risks in a more comprehensive manner, going beyond the physical closure and environmental restoration of mine sites toward community impact planning. This paper will explore how social closure plans, when done strategically, can mitigate “bust-town” risks and lead to a better return on investment for all stakeholders, contributing to sustainable community development and a positive company legacy. In this paper, we look at the risks and challenges associated with developing strategic social closure plans, such as short-term business planning and lack of regulation to, arguably most important, limited community participation.

The core of this paper focuses on how the timely use and innovative design of participatory processes throughout a mine’s life cycle can create the social framework needed for closure. We detail how companies can position their community relations and social investment strategies to contribute toward their social closure plans, allowing companies to make efficient and impactful use of their resources. The paper closes with a practical look at how multi-stakeholder participation throughout the creation, implementation and monitoring phases of social closure planning positions with the company and community as partners for sustaining community development beyond mine operation.

INTRODUCTION 

Natural resource extraction gave rise to the “boom-town”, and “bust-town” terms, concepts with important implications for mining operations. Characterized by a period of economic prosperity followed by a depression, with social challenges throughout, these terms represent significant mining-driven community development risks.

«Boom-Town» is a term referring to a community that undergoes rapid economic growth due to the sudden development of industrial activities, while «Bust-town» characterizes the subsequent economic decline following the boom phase. These concepts are explained within the context of a temporary and significant increase in population and economic activity during the boom, followed by a marked and prolonged decrease after the decline. This definition reinforces the notion that boom-and-bust cycles are inherently linked to natural resource extraction and underscores the risks to the sustainable development of affected communities (Romich, Civittolo & Bowen, 2016).

Communities initially react adversely to mining projects in their area, leading to complex discussions and conflicts. Companies look to mitigate these social complexities for project viability through social experts, offering local employment, business opportunities, and community benefits. Mines inevitably close, often prematurely, with companies focusing mainly on physical closure and environmental restoration. Community emphasis remains on maximizing existing benefits, and regulatory frameworks for social closure are slow to develop, risking the abrupt end of previous support for community development.

Companies increasingly recognize social risks in mine closure, emphasizing sustainable development and community participation. Despite international standards and local regulations mandating consultation, there is limited evidence of meaningful participation. While there have been intentions to comprehensively address closure-related social risks, including community impact planning, companies sometimes fall short.

METHODOLOGY 

We use a participatory methodology applied in two mine closures to illustrate how timely participation processes establish a social framework for closure. It elaborates on the need for companies to synchronize community relations and social investments with closure plans, ensuring efficient resource utilization. We identify the pivotal role of stakeholder involvement for sustained community development post-mining.

Stage 1. Diagnostic and Problem Identification Workshop:

In collaboration with stakeholders, this workshop focused on breaking down the problem into parts, aiming to identify specific issues for each population segment, as well as associated risks and opportunities.

Stage 2. Co-Design Workshop for Closure Plan Initiatives:

During this stage, active participation of stakeholders was encouraged in the collaborative creation of initiatives for the closure plan. The goal was to integrate diverse ideas and perspectives to develop a comprehensive and effective plan.

Stage 3. Validation and Results Presentation Workshop:

In this final phase, the validation of developed initiatives took place, and the results obtained during the participatory process were presented. Stakeholders were provided with the opportunity to express their opinions and make final adjustments to ensure alignment with community expectations and needs.

Importantly, integrating the mine social closure process into a comprehensive Communication Plan is essential, fostering transparent and effective communication channels. This strategic alignment not only enhances community engagement but also generates a lasting positive image for the company, contributing to long-term social and environmental sustainability.

PARTICIPATORY SOCIAL CLOSURE PLANNING 

Technical aspects of closure planning begin at the early stages of exploration and mine development. Social transition and closure planning and implementation, based on multi-stakeholder participation, must also begin at the early stages. Participatory planning is an iterative process that requires continuously updated information to build a solid social knowledge base, a strategy to co-design a shared vision for closure, one that must be refined throughout the mine lifecycle, and social investment strategies focused on social closure from the outset.

Meaningful participation 

An effective social closure plan aims to mitigate risks associated with town decline, enhance the return on investment for stakeholders, contribute to sustainable community development, and uphold the company’s legacy. While there is no rigid formula for social closure planning, certain principles and positive experiences can facilitate effective planning, with meaningful participation being a crucial principle.

Meaningful participation involves several key elements, including being respectful, transparent, and equitable. It should be ongoing, timely, and proportionate to mine impacts to ensure a shared understanding of the issues. Increased community involvement and feedback in decision-making processes lead to more meaningful participation. Companies must design engagement processes to foster strong governance in communities, empowering them to manage social situations crucial for handling mine closure impacts.

Mining companies often approach participation with one-way communication, extensively disseminating project information but seldom receiving stakeholder feedback. While consultation processes may increase participation, they fall short of achieving meaningful engagement. Companies commonly rely on community representatives, who may not always represent the broader community interests. Acknowledging these limitations, companies should strive to engage diverse community members meaningfully and in culturally appropriate ways. Regarding the methodology of meaningful participation implemented in both mine closure cases, it was based on the execution of three participatory workshops involving various relevant stakeholders. In each workshop, specific focus groups were conducted for different segments of the population, including workers, local residents, women’s groups, youth, suppliers, local authorities, among others. The participatory process consisted of three key stages:

Social knowledge base 

Communities evolve with time, experiencing demographic changes, new infrastructure development (especially around mining projects), and shifts in livelihoods. To efficiently navigate these social changes, companies need an updated social knowledge base. Research, surveys, and studies are common approaches for understanding a project’s territory and stakeholders. However, a true understanding of people’s idiosyncrasies, interests, and needs requires building relationships through active participation and open dialogue, fostering trust.

Participation is an investment in time and effort with the ultimate goal of building trust. Early and continuous engagement helps identify risks, expectations, perceptions, and opportunities, informing socioeconomic indicators and the social knowledge base. Documentation, including interaction forms and audiovisual records, enhances process traceability and transparency, providing essential information for social closure planning.

Social closure plan as a living document 

As closure planning should be incorporated into business strategy from the project stage of a mine, it is important to view a social closure plan as a living document, one that is periodically updated in proportion to the development of new information. In addition to the social knowledge tools, there are various other social management tools or plans that can contribute to the planning process. Below, we identify three tools that are necessary to support an effective social closure plan.

The first is a community relations engagement plan. The community relations plan should establish who all the project stakeholders are, their interests, and the best ways to engage them. This is a simple tool that will facilitate the engagement necessary for closure planning. Also a living document, the engagement plan should be updated as both the mine operation and the company-community relationship progresses.

The second tool is a Social Impact Assessment (SIA). Through the SIA, companies can identify the potential social risks and impacts presented by the project and work to define mitigation measures. Communities must be involved in this process to create understanding and manage expectations. Moreover, they should be involved in proposing mitigation measures. In some countries, the process of public consultation is mandated. It is important to view the consultation process as an opportunity to generate key information, establish communication channels and build trust. Viewing it merely as an obligation to produce a report is a lost opportunity. The success of the consultation must not be measured by the number of participants but by their input. Impacts, both positive and adverse, must be identified and actions for managing them must be outlined from the start.

The third tool is the social investment plan. The social investment plan presents an opportunity for companies to direct their financial resources toward closure goals throughout the lifespan of the mine. In order to mitigate bust-town risks, companies need to lay the foundation to manage change from an early stage. This can be done by directing investment into key areas.For social investment to complement closure goals, it is best for companies to co-design social closure plans and, as a result, create the investment plan.If the investment plan is created separately, companies should undertake an exercise to align initiatives in both plans.

Co-designing closure 

Participatory planning begins by identifying stakeholders and defining their roles in designing a social closure plan. While mining companies lead this planning, there’s a growing emphasis on «co-design,» highlighting the joint and mutual designing process between the mining company and other involved parties.

Companies often face the challenge of clarifying and demonstrating their commitment to co-design with communities, disrupting the prevailing norm of a top-down and transactional relationship. As emphasized earlier, building trust through relationship-building is crucial. Communities, particularly in the early stages, have difficulty trusting mining companies and may doubt the feasibility of a shared vision. Trust-building is a gradual process, requiring time and consistency between communication and actions. Failure to effectively address distrust may hinder the possibility of co-design.

Companies must be transparent about their interests, challenges and limitations, as well as the project’s foreseen risks and impacts on the communities at all stages of the mine lifecycle. In addition, companies must demonstrate a genuine interest in hearing and trying to understand stakeholders’ expectations, their view on risks and impacts (both actual and perceived), and their vision of development. The conversation should keep focus on closure planning and design at all times.

To effectively involve stakeholders from different sectors such as local, regional and national government, communities, civil organizations, NGOs, and employees, among others, mining companies need to carry out a range of engagement mechanisms from the early stages. These include individual meetings and interviews, collective meetings and working sessions, and general assemblies, among other useful techniques to keep stakeholders engaged.

It is important to remember that participation must be meaningful. The dynamics of these forums need to be carried out in a way where communities are empowered to influence and, in some circumstances, make decisions. It is through increased levels of participation that company and community may come together as partners for defining, creating and sustaining development.

A helpful tool for co-designing closure plans is the exercise of visioning. Visioning is the development of a plan or vision for the future. It is best guided by a powerful question, one that enthuses participants to respond. A straightforward powerful question for closure can simply be, “How is our community once the mine is no longer here?”. This question must then be explored through using the variety of engagement mechanisms previously described with all different groups of actors. It is important to organize engagement with special attention to marginalized groups, such as women, elderly, teenagers and children. The answers to this question can typically be categorized into the following development themes: health, education, livelihoods, environment, infrastructure and governance. By understanding what the ideal future looks like in each of these areas, companies, communities and civil society can then undertake the planning process to best determine how to reach these goals. The results of the planning process can be interpreted into actions and projects that guide strategic social investment. It is in the best interest of companies and communities to have social investment plans aligned with closure plans to ensure that the revenue and effort invested throughout the lifecycle of the mine contribute to achieving the long-term vision. The sub-products of the process such as trust, communication and governance models are key to the success of generating positive impacts during mine operation and beyond, contributing to the sustainable development of host communities and a positive legacy for the company.

CONCLUSION  

Timely and participatory planning is key to ensure that communities that boom during a mining operation do not suffer at closure. Understanding that closure planning is an iterative process and that the plan itself is a living document, companies start off on the right foot. Designing and implementing participatory processes that engage communities in a meaningful manner and empower them in the decision-making process regarding social management is key. As part of this design, companies can engage communities in co-designing a closure plan to create the relationship dynamic and key information needed for success.  By creating a shared vision of community life after the mine, companies and communities are able to understand the goals of well-being and development and work throughout the mine’s lifespan to create and build upon the foundation to achieve the vision. With this, at the time of closure, communities have the relationships, tools, and structures to continue capitalizing on benefits generated by the mining operation. Companies can close operations with greater confidence that their investment benefits will continue to have a positive impact, leaving behind a positive legacy.

REFERENCES  

Gankhuyag, U. and Gregoire, F. UNDP and UN Environment (2018) Managing mining for sustainable development: A sourcebook. Bangkok: United Nations Development Programme.

International Council on Mining & Metals (2019) Integrated mine closure. Good Practice Guide, 2nd Edition. London: ICMM.

Romich, R., Civittolo, D., & Bowen, N. (2016). Characteristics of a Boomtown. Ohio State University