Newmont has ceased gold production at WA’s Telfer mine after spotting ‘cracking and seepage’ on tailings dam wall

Newmont has halted gold production at the remote Telfer WA gold mine after spotting early signs of tailings dam problems.

Newmont’s Telfer operation in the Sandy Desert in northwestern Western Australia, which has been operating since 1977.

Newmont has been forced to shut down the mill at its giant Telfer mine in WA over safety concerns around the mine’s tailings facilities.

The Australian understands the mill at Telfer could be out of commission for as long as six weeks after structural problems emerged at the remote mine’s newest tailings facility just before Christmas.

Newmont confirmed the closure on Wednesday, saying it had halted work at Telfer’s mill on December 24 after the company detected “cracking and seepage” on an internal embankment between the newest tailings facility – where most of the mine’s waste is now deposited – and its predecessor.

The gold mining giant confirmed it had closed Telfer’s mill as a result of the problems, with a return to gold production not likely until a safe way can be found to dispose of waste produced from the giant production facility.

“Following initial detection of cracking, Telfer activated its emergency response plan including closure of some work areas near the tailings storage facilities while analysis and monitoring was undertaken using radar and drone technology,” a spokesman said.

Telfer has been operating since 1977 and has eight tailings dams, only two of which are currently in use – TSF7 and TSF8.

“On January 6, 2024, Newmont’s Engineer of Record signed off on the stability of both of Telfer’s tailings storage facilities which will allow Newmont to undertake works on TSF 7 as the first step towards recommencing tailings deposition into TSF 7,” the company said.

“The Engineer of Record and our Newmont tailings teams are continuing to work on developing a comprehensive tailings deposition plan so that the processing operations can be restarted. This planning includes consideration of remediation options for TSF 8. Mining operations at Telfer are continuing with crushed material being stockpiled while the processing operations are suspended.”

Newcrest Mining operated Telfer until Newmont’s $26bn takeover of the Australian gold major last year.

Reports published by Newcrest in August 2023 on Telfer’s tailings facilities noted historical problems at TSF 7 “with respect to stability and internal erosion of the embankment”.

The WA Department of Mines, Industry Regulation and Safety confirmed on Wednesday it had issued prohibition notices to Newmont requiring the company to “limit the use of the tailings storage facility until repair work has been done”.

Acting Worksafe commissioner Sally North said departmental officers issued prohibition notices on January 8, replacing earlier interim orders affecting the facility’s operations.

The fact the structural weakness sits between two existing tailings dams means there is little risk to the safety of mine workers. But any failure of the wall between the two facilities poses a significant risk to continuing operations at the mine, as a spillover could reduce the capacity of the most recent tailings dam – only built in 2021 – and potentially force Newmont to seek approval for an entirely new containment facility.

Sources say Newmont is unlikely to be able to return the mill to operation until at least the end of January, with the potential for its stoppage to last as long as eight weeks.

Telfer produced almost 349,000 ounces of gold last financial year, under Newcrest’s management.

Newcrest’s tailings facility reports last year also noted the need for a formal assessment of the stability of the mine’s first six tailings dams, saying a dam safety review for all of the mine’s facilities was being planned.

Newmont is currently considering the future of Newcrest’s assets, although Newmont boss Tom Palmer last year told The Australian Telfer’s infrastructure in the prospective Paterson district of the Pilbara – and the nearby emerging Havieron joint venture with Greatland Gold – meant Telfer remained a key asset for Newmont.

Newmont’s stock closed down $2.61, or 4.4 per cent, on Wednesday at $57.19.