What this lesson teaches
I can explain the impacts of extractive industries and evaluate how they are managed.
Syllabus 9173, Topic 1.1, 3. Managing Resources. How do we manage the extraction of non-renewable resources by the extractive industries?
Make a guess
A mining company promises to restore the land when the mine closes in 30 years. What makes this promise most believable?
- Money set aside now, and duties enforced.
- The company's large profits and assets today.
- Publishing its revenue figures every year.
- A well-written promise in its annual report.
Show the answer
Money set aside now, and duties enforced.
Closure funds secured in advance mean the public does not pay if the company leaves. Independent monitoring checks the work is done.
Managing mining impacts needs rules, money and accountability from before approval to long after the mine closes.
Before approval, an environmental and social impact assessment identifies risks and compares options, like other sites or designs. It is only useful if the evidence is independent, the public can scrutinise it, and the findings affect the decision.
During operation, rules on waste, water, emissions and worker safety must be monitored and enforced. Tailings are the fine waste left after processing ore, and they need long-term care. Rehabilitation restores damaged land where possible, but cannot always recreate the original ecosystem.
Money for closure should be set aside in advance, so the public does not pay if the company leaves. Local training, buying locally and fair compensation spread benefits. Developing other industries prepares communities for when the mine closes.
Revenue transparency lets citizens compare what companies pay with what governments receive and spend. The Extractive Industries Transparency Initiative (EITI) supports this. But publishing figures does not guarantee fair taxes or good spending.
- Impact assessment
- Identifies risks before approval.
- Closure funding
- Money set aside in advance for clean-up.
- EITI
- Supports public disclosure of mining revenues.
Step by step
Match the tool to the harm
Water rules, closure funds or revenue checks.
Test enforcement
Who monitors, and what happens if rules are broken?
Judge lasting results
Livelihoods and environment after closure.
Real examples to use
Norway
Norway saves its oil revenues in a sovereign wealth fund worth over US$1 trillion, so future generations also benefit.
Botswana
The government and De Beers jointly own Debswana, the main diamond miner, so diamond profits help fund schools and roads.
Worked example: Two closure plans
In a made-up example, Mine A promises to restore land when it closes. Mine B must set aside secured funds, publish monitoring and update its plan. B offers stronger protection, but still needs independent checks.
Watch out for this
Publishing revenue figures guarantees good governance.
Transparency provides evidence. People and institutions must still act on it.
Check your understanding
What most strengthens a mine's promise to restore the land?
- An advert promising a greener future for the region.
- A high mineral price, so the company can afford to pay.
- Secured closure funds, independent checks and duties.
Show the answer
Secured closure funds, independent checks and duties.
Yes. These make the promise real.