Politics & Government

Billions of dollars in gold sparks mine expansion, promise of 250 jobs near SC town

Potentially rich deposits of gold in South Carolina are fueling the expansion of a huge mine that has boosters excited about the prospect of 250 new jobs in a tiny community with a history of unemployment.

OceanaGold’s expansion plan says the Australian company would increase its existing 4,552-acre Haile Gold Mine site by more than 900 acres near Kershaw, a town in Lancaster County halfway between Columbia and Charlotte.

But the proposal to expand won’t happen until federal and state environmental regulators decide whether to approve the bigger mine — and some folks are leery of how more digging might affect the landscape from a gold mine that already is larger than any ever established in South Carolina.

The S.C. Department of Health and Environmental Control calls the mine expansion “substantial.’’

“We recognize that mining jobs are valuable to the local economy, but there are boom and bust problems that the gold mining industry has a painful history with,’’ the Sierra Club’s Bob Guild said. “From an environmental perspective, we are trying to make sure we address these problems.’’

According to plans filed with the state, OceanaGold is seeking to dig an underground mine that would extend up to 1,314 feet below the surface, while combining five existing excavation pits at the site in southern Lancaster County.

A waste lagoon, known as a tailings pond, would be enlarged by about 20 percent to handle more mining waste, according to plans. Records show the area of the tailings pond, which will hold cyanide waste, would rise from 524 acres to 632 acres. The bigger pond would have the capacity to hold 72 million tons, up from 40 million tons

The Haile Gold Mine expansion also would roughly triple the amount of potentially acid generating rock that will be piled up and stored at the mining site, according to an application to expand the mine filed June 13 with the S.C. Department of Health and Environmental Control.

Acid drainage and cyanide are among the major environmental threats from gold mines across the country, contaminating groundwater and rivers in some places.

OceanaGold says it will take every precaution to make sure the mining operation is safe for workers and doesn’t scar the environment.

“Safety is a priority at OceanaGold,’’ said David Thomas, a vice president with OceanaGold.

Among other things, waste areas will have synthetic liners to keep toxins from seeping into the ground, the company says. The company plans to fill in many of the pits it digs once it has pulled out all the gold. And the company says it will continue using a cyanide treatment process to lower the waste’s potential toxicity to birds that might land in the tailings pond.

OceanaGold’s expansion includes acquisition of a 49-acre tract that includes eight acres across from the Lancaster County mine in Kershaw County. The company says the Kershaw County property won’t be mined, but instead used as a buffer zone.

OceanaGold’s Haile mine is the largest open-pit gold mining operation in the eastern United States, rivaling the size of some mines in the West. The South Carolina mine cranked up operations about three years ago, following approval by state and federal regulators to begin the work.

At least $2 billion worth of gold was initially projected to exist far below the surface. OceanaGold now wants to mine some gold that previously had been too expensive to dig up. The rising price of gold in recent years has made it affordable to dig for those deposits, the company says. The price of gold this week was about $1,400 per ounce.

So far, the OceanaGold operation has relied on strip mining to extract gold. One mining pit is projected to reach more than 1,200 feet into the ground, making it the deepest mining pit in South Carolina, according emails from OceanaGold and the S.C. Department of Health and Environmental Control. The new underground mine would involve digging a tunnel into the earth and hauling gold-bearing rocks to the surface.

The strip-mining operation is at the site of a historic gold mine that reopened after more gold deposits were found in the area. Romarco Minerals, which sold the mine to OceanaGold in 2015, discovered substantial deposits of the precious metal about a decade ago.

Kershaw Mayor Mark Dorman said the mine has provided an economic boost to the one-time textile community since opening. Vacant houses have been rented or sold to mine workers, tax revenues are up and restaurants are bustling, he said. A new Huddle House restaurant is expected to open this summer, Dorman said.

A 2018 study by the University of South Carolina’s business school said reopening the Haile Gold Mine has had an $87 million annual economic impact on Lancaster County, OceanaGold says.

“When Springs Mills closed .... that’s where most of the people were employed,’’ Dorman said of the plant that shut down more than 20 years ago. “People had to start seeking employment elsewhere. With the gold mine coming in, that kind of took the place of the textile industry. That gives the people an opportunity to work.’’

The company now employs about 400 people at the site near the town of Kershaw, but will increase its work force by 250 people as the mine reaches peak production in the next five years, records show. The mine’s original owner, Romarco Minerals, at one point said the mine would employ 800 people.

New jobs coming to the site will mostly be surface support positions, including maintenance jobs, OceanaGold says. Some truck drivers will be hired to haul material from the underground mining venture. Employment will be highest in 2024, when the mine is expected to be running at its peak, records show.

The mine is expected to close in 2031, but Dorman said the community will benefit with more gold mining. He said he trusts that government regulators will make sure the mine doesn’t hurt the environment.

“I think it’s a great thing they are going to expand,’’ Dorman said. “It’s going to create more jobs in this community and surrounding area.’’

Despite company assurances and the promise of jobs, the Sierra Club’s Guild said the expansion will need a thorough environmental review. DHEC should require the company to post more money to pay for a cleanup if an accident occurs at the site, Guild said. The company said it is willing to do that.

The Sierra Club, the only South Carolina environmental group to fight the mine’s opening, succeeded in 2015 in forcing the company to put up an extra $5 million in cash to pay for a cleanup if any environmental damage occurs. That increased the cleanup bond required by DHEC to $65 million. The Sierra Club took action after The State newspaper reported on contamination that resulted from metals mining in Montana and South Carolina.

Acid mine drainage is one of the biggest concerns with big metals mines, such as the gold digging operation in Lancaster County. When sulfide-rich rocks are dug up to extract gold, the exposure to air can cause them to create acid. The acid then releases an array of metals into groundwater and creeks.

Many western gold and copper mines have produced acid drainage that experts say could linger in the environment for centuries. South Carolina has two closed gold mines that are federal Superfund cleanup sites.

“If you expand the volume of material that you are going to be processing to get those trace amounts of gold, you expand the potential long-term acid mine impact,’’ Guild said.

The U.S. Army Corps of Engineers plans to conduct an environmental study to see how the expanded mine would affect wetlands and creeks around the mining site. The agency held a hearing on it in April attended by 94 people, some of whom said they supported the Haile Gold Mine, corps officials said. The environmental study could take much of this year to complete.

When the mine was approved in 2014, federal regulators gave owners permission to destroy or alter up to 1,100 acres of wetlands, an unusually large amount. Wetlands provide wildlife habitat and control flooding by soaking up storm water. The expansion is expected to affect as much as 90 acres of wetlands, according to the Corps of Engineers.

Regulators at DHEC said they won’t make a decision on the mine expansion permit until after the Corps’ supplemental environmental impact statement is completed. That could take months to complete.

OceanaGold says it will offset the environmental impacts of the operation through mitigation, a process that often involves protecting land elsewhere. The company acquired land that became a nature preserve in Richland County during its effort to open.

Guild said people need to be aware that Kershaw’s economic gain will only be temporary since the mine plans to close in the next 15 years.

“Fifteen years down the road, all those jobs go away, all those stores close and suddenly those houses get abandoned and not maintained,’’ he said, noting that there is “nothing to suggest they have adequately addressed the additional environmental burden on South Carolina once the gold rush is over.’’

Sammy Fretwell has covered the environment for more than 20 years at The State. He writes about an array of environmental subjects, including nature, climate change, energy, state environmental policy, nuclear waste and coastal development. Fretwell is a University of South Carolina graduate who grew up in Anderson County. Reach him at 803 771 8537.
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