MC Mining Limited (MC Mining) discloses information regarding its financial provision for environmental rehabilitation in its annual financial statements.
The information which is publicly available is:
- The estimated figures for environmental rehabilitation obligations, and the funds and guarantees available to meet those obligations.
- The basic assumptions used in the calculation of the environmental rehabilitation provision, and the accounting treatment of the rehabilitation obligations.
- That financial guarantees and restricted cash deposits are the financial vehicles used to provide for future rehabilitation obligations.
- One consolidated figure for financial provision for environmental rehabilitation in the annual financial statements.
While MC Mining’s disclosures are broadly in line with those of its peers, they do not, however, provide stakeholders with:
- clear, understandable, comparable information about the type and extent of environmental damage covered by these estimated liabilities;
- the methods and experts used to calculate the estimated liabilities;
- sufficient information to enable external verification that the estimated liabilities have been accurately calculated;
- clear, understandable explanations for why the estimates and funds set aside for financial provision for environmental rehabilitation fluctuate from year to year; and
- information about the way in which the funds set aside for rehabilitation are managed and protected.
MC Mining provided brief answers to the questions posed in the CER’s letter requesting further information and clarity.
MC Mining indicated that “the assessment has been performed by third parties that have the necessary skills to perform the evaluation for the costs of rehabilitation”.
MC Mining stated that it would consider making its assessments of financial provision in relation to any new authorisations publicly available. This is not a useful response as they are required by law to do so.
MC Mining stated that it would “consider disclosing information on the rehabilitation provision at each operational level in the future”.
MC Mining explained why its estimated rehabilitation obligations and restricted cash available to meet those obligations had significantly reduced from 2011 to 2016.