Understanding Reclamation Costs and their Associated Accounting Practices

The COSIA Land EPA held a workshop to draw out information regarding the key components of the Assessment, Remediation and Reclamation (ARR) process and how they are managed and accounted for from an Accounting, Finance, Tax and Royalty (AFTR) perspective. This workshop harnessed experience and expertise of staff from ARR and AFTR areas of COSIA companies to explore accelerating environmental performance through increased reclamation cost effectiveness. Objectives were to: (1) increase knowledge of reclamation (ARR) and finance (AFTR) staff to improve corporate asset retirement efficiency, reduce costs and increase return on investment; (2) learn the languages used by ARR and AFTR practitioners; (3) test assumptions for calculating, funding and reporting ARR costs and their treatment in AFTR systems; (4) learn about ARR and AFTR processes within and between companies; and (5) identify the triggers and drivers for ARR and AFTR.

Participants had a strong interest in gaining better understanding of each other’s roles and how they could support each other to produce better results. Recommended Company Actions: (1) catalogue existing training materials and make staff aware of them; (2) prep company-specific 101 courses based on COSIA template; (3) implement Lunch ‘N Learns to explain AFTR and ARR; (4) describe how ARR costs affect company bottom line and how they can be managed; (5) develop scenario planning and sensitivity analysis tools to show impacts of ARR plans and changes; (6) increase opportunities to build relationships between people in ARR and AFTR and Commercial Economics; (7) develop mentoring program for ARR and AFTR staff (especially new hires). Recommended COSIA Actions: (1) prepare generic 101 course templates for a variety of ARR and AFTR issues; (2) develop factsheets explaining benefits and rationale for ARR and AFTR work; (3) develop factsheets to explain ARR steps and when and why to contact AFTR staff – include risk and impacts of decisions; (4) recommend CAPP drive implementation of the Record of Progressive Reclamation for mines. 8 fact sheets were generated in key areas of interest.