Contaminated mine 'an embarrassment to Canada', says Yukon judge

Yukon Supreme Court Justice Ron Veale has delivered a strongly-worded 'wake up call' to Canadian taxpayers, who are now on the hook for another expensive mine cleanup in Yukon - the abandoned Mount Nansen site.

Supreme Court justice cites 'unscrupulous and unchecked profiteering' at BYG's Mount Nansen mine

The Mount Nansen mine is a former gold and silver mine, 60 km west of Carmacks, Yukon. In 1999, owner BYG Natural Resources Inc. closed the mine. (Yukon government)

A Yukon judge has delivered a strongly-worded "wake up call" to Canadian taxpayers, who are now on the hook for another expensive mine cleanup in the territory. 

Yukon Supreme Court justice Ron Veale approved a clean up plan for the abandoned Mount Nansen mine site, last spring — to be paid for by Ottawa — but issued his written decision this week.

He used the opportunity to lambaste the mine's former owner, Toronto firm, BYG Resources, for an "unscrupulous history of ... operational mismanagement" that left a big, toxic mess for government to deal with.

'It is my opinion that an account of BYG's historical activity in the Yukon should be brought to the attention of the federal and territorial taxpayers,' Yukon Supreme Court Justice Ron Veale wrote. (Philippe Morin/CBC)

"This case stands as a painful reminder of the lasting and egregious damage that unscrupulous and unchecked profiteering can bring about in the mining sector. It is an embarrassment to Canada, Yukon and the responsible mining community," Veale's decision reads.

"It is my opinion that an account of BYG's historical activity in the Yukon should be brought to the attention of the federal and territorial taxpayers, who remain fiscally responsible for remediation efforts."

'Raping and pillaging' Yukon resources

BYG began mining at the Mount Nansen site, about 180 kilometres north of Whitehorse, in 1996, but then closed shop just three years later after being charged with several environmental violations (the company was guilty of "raping and pillaging" the territory's resources, the Yukon Supreme Court found in 2007).

Five years later, in 2004, BYG filed for bankruptcy and the federal government assumed responsibility for the site. Federal lawyers estimate Ottawa has spent about $20 to $25 million since then, just to monitor and control the site.

Now, the mine is for sale to whomever is willing to take on a "government subsidized remediation project," according to Veale.

A 2011 environmental assessment at Mount Nansen estimated about 55,000 cu. metres of contaminated soil, 300,000 cu. metres of tailings and 500,000 cu. metres of waste rock at the site, all requiring attention.

Not the first time

Veale also draws a comparison to another environmental "disaster" in Yukon — the infamous Faro mine.

"[Mount Nansen] is not the first time in recent Yukon history that a mining company has conducted itself in bad faith, collapsed into bankruptcy and abdicated its responsibilities to the governments of Canada and the Yukon," he wrote.

Yukon's Faro mine produced lead, silver and zinc from about 1970 until 1998. The federal government took over the site when the owner went bankrupt. In 2009, the federal and Yukon governments agreed on a plan to deal with the estimated 64,000 hectares of contaminated soil and groundwater.

The federal government is financially liable for remediation of the Faro and Mount Nansen sites because mining there happened before 2003, when Yukon's Devolution Transfer Agreement was signed. Yukon is responsible for any mining damage since 2003.

Veale says Yukon taxpayers should take note. 

"The point to be made is that the BYG disaster could happen again and the Yukon, with approximate annual revenues of $1,303,131,000, will be liable for the costs of the environmental cleanup," his decision reads.

"This case should be a wake-up call."

With files from Vic Istchenko