IMCC BONDING WORKSHOP

Nevada Reclamation Bonding Nevada - Bureau of Land Management

August 21, 2013

Nevada Memorandums of Understanding (MOUs) Participating Agencies:   U.S. Department of Interior - Bureau of Land

Management - Nevada (BLM)   Nevada Division of Environmental Protection -

Bureau of Mining Regulation and Reclamation (NDEP)

  U.S. Department of Agriculture - Forest Service Humboldt-Toiyabe & Inyo National Forests (USFS)

  Nevada Division of Minerals (NDOM)

BLM/NDEP/USFS MOU Establishes and maintains coordination for administration and reclamation of lands disturbed by exploration and mining operations   Bonding section provides for:

 Single required bond amount  Coordination of reviews  Concurrence required for bond

reductions

BLM/NDOM MOU Sets terms and conditions under which the BLM will accept participation in NDOM’s bond pool program as financial guarantees under 43 CFR 3809.570.

Establishes and maintains coordination between agencies for their respective responsibilities when providing bond coverage.

RECLAMATION BONDS

BLM managed bonding:   Traditional surety bonds: 67%   Letter of Credit: 24%   Corporate guarantees*: 7%   Cash: 1%   Time deposit: 0.5%   Treasury security: 0.2%   Bond pools (state held) - 0.1%

•  Corporate guarantees are no longer allowed. All current CGs are grandfathered in. The state may accept them for non-federal lands.

RECLAMATION COST ESTIMATES (RCEs)

 Periodic Review of RCEs are Required (Bond Updates)  Every 3 years for Plans of Operations  Every 2 years for Notices  More frequently if required by State

regulations or BLM Field Manager  Annually if for part of the operation

(phased bond)

SRCE Background   Federal & State Agency/Industry Effort

  Bureau of Land Management - Nevada (BLM)   Nevada Division of Environmental Protection

(NDEP)   Nevada Mining Association (NvMA)   Approximately 5 years to develop by working

groups   Implemented 2007   In voluntary use by most mining operators in NV   Available on website to public free of charge

SRCE Purpose   Estimation of required RCE amounts for reclamation of

mining and exploration operations   Provide accuracy, completeness, and consistency in calculation

of a RCE   Expedite preparation and review of RCEs   Based on applicable State and Federal laws for bonding

○  Federal Code of Regulations 43 CFR 3809.500 - Financial Guarantee Requirements

○  Nevada Revised Statutes NRS 519A.160 (4) & NRS 519A.210 (5) – Reclamation of Land Subject to Mining Operations or Exploration Projects

○  Nevada Administrative Code NAC 519A.350 - Reclamation of Land Subject to Mining Operations or Exploration Projects – Provision of Surety

○  Nevada Administrative Code NAC 534 – Construction and Plugging of Wells

SRCE Overview   Provides standardization of reclamation calculation

methods, data, and procedure   Assumes third-party contractor performs reclamation   Unit costs updated annually consist of:

  Nevada based equipment rental costs   Davis-Bacon Labor Act wages for Nevada   Material costs quotes from local suppliers

  Standardized volumetric and other quantity calculations   Standardized labor and equipment productivities

  Caterpillar Performance Handbook   RS Means Heavy Construction Data

SRCE SRCE Summary Sheet   Itemizes costs by Labor, Equipment, and Materials and is

subdivided into categories:   Earthwork/Recontouring   Revegetation/Stabilization   Detoxification/Water Treatment/Disposal of Wastes   Structure, Equipment, and Facility Removal   Administrative Costs

  SRCE Excel Worksheets   Website with links for SRCE and other cost estimators:

http://www.blm.gov/nv/st/en/prog/minerals/mining.html   Provides costs to reclaim mining components   Results report to SRCE Summary Sheet

QUESTIONS?

CONTACT INFORMATION Lacy Trapp Land Law Examiner, Bonding BLM Nevada State Office ltrapp@blm.gov Office: (775) 861-6599

Doug Siple Mining Engineer - BLM/NDEP Liaison BLM Nevada State Office dsiple@blm.gov Office: (775) 861-6636 (BLM) Office: (775) 687-9390 (NDEP)