1. High Lake Project Hydrology & Surface Water Quality Eugene Yaremko,nhc Leslie Gomm, GLL

2. Hydrology Impact Assessment Has followed an ‘Issues-based’ approach where mining activities would have an impact on: – Surface Water Quantity –Distribution of Water

3. Hydrology Impact Assessment Local study area vs. environmental impacts: –It has been assumed that impacts related to mining activities and surface water will not extend beyond the LSA

4. Hydrology Baseline Data Streamflow – 14 hydrometric stations –10 of these associated with Kennarctic River Flow –2 stream crossings along all-season road –Periods of record available range from on to three years, beginning in 2004 Climate station near south end of High Lake – installed in 2004: –Temperature, rainfall, relative humidity, wind speed and direction

5. Hydrology Baseline Data Snow course measurements immediately prior to spring freshet (2004 and 2005) Bathymetric surveys of primary lakes within LSA

6. Hydrology Regional Assessment The short streamflow and climate record available within the LSA make it necessary to utilize regional information principally: –Six water survey of Canada stations –Climate records for Lupin/Contwoyto Lake; Kugluktuk/Copper River; and Cambridge Bay.

7. Hydrology Water Balance Assessments LSA Three primary components in the process: –Annual precipitation –Annual evaporation –Coefficient of runoff

8. Hydrology Annual Precipitation Estimate of annual precipitation at mine site has to be regional information Three long-term climate stations were utilized: –Lupin/ Contwoyto Lake (combined) – centered 250 km south of High Lake –Kugluktuk/Coppermine (combined) – centred 170 km south and 50 km north of High Lake –Cambridge Bay – centred 240 km East and 175 km north of High Lake

9. Hydrology Annual Evaporation Mean Annual Evaporation for Project – 240 mm Estimate of mean annual evaporation based on regional information principally: –Lupin – 275 mm –Doris North Project – 220 mm –Salmita (Reid) – 286 mm Hydrological Atlas of Canada – MAE contours

10. Hydrology Runoff Coefficient Adopted value of 0.60 Based on local and regional information

11. Surface Water Quality Site Water Management - Overview Predicted Impacts –4 pathways Key Issues –Assessment Approach For Kennarctic River –Summary of Baseline –Total vs. Dissolved Metals and TSS –Water Quality Model –Water Management Plan

12. Site Water Management The following principles were used in the design of water-related aspects of the Project: –Minimizing the number of drainage areas (sub- catchments) affected by the Project by limiting most of the development to within the High Lake drainage area –Minimizing the disturbance footprint outside of the High Lake drainage area –Implementation of BMP’s for the collection, treatment and handling of all site runoff

13. Site Water Management –Filling pits with tailings –Routing of mill tailings, mine water, pre-treated deep groundwater, treated sewage, and runoff from the waste rock piles, mill area and buildings to the High Lake Tailings Impoundment; –Treatment at or near source –Maximizing underground mine backfilling of PAG material –Seasonal discharge to Kennarctic River (June – October) with treatment if required

14. Ore StockPile Retention Time 2 to 3 Years

16. Predicting Site Water Quality High Lake Water Quality Model: –Predict the water quality, water volumes and elevations in High Lake, AB Pit and D Pit –Source loading terms for mine rock and pit walls based on kinetic tests –Incorporates inputs due to explosives residues from mine rock and pits –Predict water quality any discharges to receiving environment including the Kennarctic River, L15, and L4 during mine operations, closure and post-closure (to Year 150) –Based on a MAP of 280 mm and MAE of 240 mm and run using different hydrological scenarios modeled including a 3 yr drought and 2 year wet period

17. Predicting Site Water Quality High Lake Water Quality Model - Results: –All predicted concentrations of regulated parameters below MMER except zinc for first 1.5 years –Chloride, nitrite, aluminum, antimony, arsenic, cadmium, chromium, copper, lead, manganese, nickel, selenium, silver and zinc – above threshold levels Copper, zinc and cadmium - existing lake conditions - decrease over time from the naturally high levels Chloride, chromium and cadmium – estimated pre-treated inflows from underground mine Ammonia, nitrate and nitrite nitrogen – explosives residues and sewage (minor) Selenium and other parameters – primarily mill effluent and secondarily mine rock

18. Predicting Site Water Quality High Lake Water Quality Model - Results: –Discharge to Kennarctic River will not occur until 3 rd year of operations –Treatment of discharge through polishing pond will be carried out to reduce metal levels in discharge – copper, cadmium, chromium and zinc - where required –Long term water cover: High Lake - 5 m D-Pit - > 10 m

19. Surface Water Quality Predicted Impacts Surface water quality impacts were assessed using the following thresholds: –CCME Guidelines for the Protection of Aquatic Life –Cadmium – U.S. EPA Criterion Continuous Concentration (CC) –Chloride – U.S. EPA CCC –Manganese - Canadian Drinking Water Guidelines aesthetic objective

20. Surface Water Quality Predicted Impacts SWQ1 – Project activities, including roads, outside immediate High Lake catchment –Based on annual load model predicted concentrations above existing baseline concentrations but below threshold values for protection of aquatic life except for: Copper in L15 – within range of baseline concentrations

21. Surface Water Quality – Predicted Impacts SWQ2 – Diversion of streams: L18 to Kennarctic River and L15 to L4 –Permanent diversion of these streams will not result in any appreciable changes in water quality

22. Surface Water Quality – Predicted Impacts SWQ3 – Construction of High Lake Tailings Facility –Discharge of treated High Lake water during dam construction will not result in any changes in the water quality in the Kennarctic River except for cadmium –Predicted cadmium concentrations are above background levels but below the threshold for protection of aquatic life

23. Surface Water Quality – Predicted Impacts SWQ4 – Discharge of water from the High Lake Tailings Facility to the Kennarctic River –Predicted open water season concentrations in the Kennarctic River immediately downstream of discharge are predicted to be above existing baseline concentrations but below threshold values except for copper and selenium –Predicted under-ice concentrations (from deep groundwater inflows after Year 34) of selenium and chromium are above threshold values

24. Surface Water Quality Predicted Impacts Selenium - Other jurisdictions acknowledge unpredictable effects with wide range of guidelines. Body burden in fish more useful than water concentration. Will monitor body burdens in fish.

25. Surface Water Quality Issues Kennarctic River –Concerns have been raised regarding the approach taken for assessment of water quality impacts in the Kennarctic River –The following outlines the approach taken in the assessment including significance determination

26. Surface Water Quality Issues Kennarctic River – Open Water Season –Fully mixed concentrations in the Kennarctic River downstream of discharge are predicted to be above existing baseline concentrations for a number of COCs but below threshold values for all except for copper and selenium

27. Surface Water Quality Issues Kennarctic River-Open Water –Copper Max. concentration = 0.0034 mg/l (LSA) Above CCME threshold (0.002 mg/L) for 5 years during operations in both LSA and RSA –Selenium Max. concentration = 0.002 mg/L (LSA) Above CCME threshold (0.001 mg/L) for 3 years during operations in both LSA and RSA

28. Surface Water Quality Issues Kennarctic River-Under Ice –Predicted under-ice concentrations (from deep groundwater inflows after Year 34) of selenium and chromium are above threshold values Selenium – Max. concentration = 0.0012 mg/l –Above threshold (0.001 mg/L) for 6 years (May only) in LSA Chromium – Max. Concentration = 0.0011 mg/l –Above threshold (0.001 mg/L) for 10 years (May only) in LSA

29. Surface Water Quality Issues Kennarctic River –Magnitude of impacts were assessed using following criteria

30. Surface Water Quality Issues Kennarctic River Summary of Significance Rating Criteria

31. Surface Water Quality Issues Assessment of significance would not change by making LSA smaller and having RSA start farther upstream – same magnitude (moderate) in both LSA and RSA.

32. Surface Water Quality Issues Plume Delineation –Downstream distance for complete mixing of the High Lake discharge ~ 230 m Based on a single point channel side discharge configuration with instantaneous vertical mixing Estimated that at 50 m downstream ~ 90% diluted –A plume delineation study will be carried out: Modelling of High Lake discharge Field monitoring to calibrate and validate model results Based on plume delineation study results, appropriate mitigation may be implemented to minimize mixing zone

33. Surface Water Quality Issues Summary of Baseline Data –Concern that baseline data not presented adequately to characterize natural variability Zinifex will provide an updated summary and evaluation of the baseline water quality data set including: –Evaluation of temporal and spatial variability –Additional data collected in 2006 and 2007 –Discussion of linkages to the future site AEMP

34. Surface Water Quality Issues Total vs. Dissolved Metals and TSS –Concerns raised of the use of dissolved metals for mine rock source terms; under-estimates metal concentrations –High Lake model: Pits and waste rock – dissolved metals Tailings supernatant, residual drainage, ore stock pile – total metals –Road model: Road construction material - dissolved metals Natural drainage – total metals

35. Surface Water Quality Issues Total vs. Dissolved Metals and TSS This approach to modelling was adopted given: –In general, in aquatic toxicology, it is the dissolved metal fraction is considered to be the metal fraction that is bio- available and elicits most of any toxic effect. –BMP’s will be used on-site to minimize TSS loadings to the receiving environment –Also note - that fractions estimated as dissolved report to tailings area but discharge to environment was estimated as total metals

36. Surface Water Quality Issues Total vs. Dissolved Metals and TSS –Concerns raised with modelling of road runoff No particulate fraction Assumed 15 mg/L only in first year –Concerns also raised about use of annual load model

37. Surface Water Quality Issues Total vs. Dissolved Metals and TSS –Zinifex is committed to re-evaluating the impacts of metals associated with particulate matter including: Assessment of the contribution of particulate fraction to overall loading and associated impacts in both models Sensitivity analysis of TSS loading in the road runoff model Monthly model has subsequently been developed for road runoff

38. Surface Water Quality Issues WQ Model –Predict the water quality, water volumes and elevations in High Lake, AB Pit and D Pit; –Predict water quality any discharges to receiving environment including the Kennarctic River, L15, and L4 during mine operations, closure and post-closure (to Year 150) –Different hydrological scenarios modeled including a 3 yr drought and 2 year wet period –Model originally in Stella – recently transferred to Goldsim

39. Surface Water Quality Issues WQ Model –Several concerns have been raised during review of DEIS regarding the High Lake water quality model including: Lack of rationale for selection of runoff coefficients Selection of drought/wet scenarios Use of average flow conditions

40. Surface Water Quality Issues WQ Model Model has been update for ease of running scenarios to adequately characterize the system and run scenarios Highlights of Goldsim Model –Water treatment at source (AB Pit, D Pit and ore stockpile) –Desalination of deep groundwater –Updated source loading terms from mine rock

41. Surface Water Quality Issues WQ Model Highlights of Goldsim Model –Increased AB Pit Cap and AB NAG cover from 5 m to 10 m –Use of thermo-siphons –Updated estimates of deep and shallow groundwater seepage –Incorporates receiving environment modelling including L4, L15 and the Kennarctic River –Climate change scenario

42. Surface Water Quality Issues Updated Model Results –Predicted open water concentrations – similar to previous results with same duration and extent –0.0032 mg/L Copper and 0.002 mg/L Selenium –Predicted under-ice concentrations – no longer any parameters above thresholds –0.0005 mg/L Chromium and 0.0009 Selenium –Reduced impact (under ice) but no change in overall determination of significance –Impacts will be further evaluated in an Aquatic Risk Assessment

43. Surface Water Quality Issues

47. Additional 100-year extreme drought scenario - test ability to maintain water cover –Year 20: 1:100 return event = 164 mm Evaporation = 292 mm –Year 21: 1:50 return event = 180 Evaporation = 265 mm –Year 22: 1:10 return event = 216 Evaporation = 240 mm

48. Surface Water Quality Issues

49. Water Management Plan –Preliminary Water Management Plan (WMP) was provided as part of the DEIS which included a summary of: Site water management facilities including treatment Mine rock storage plan Tailings management Predicted performance of water management systems (water quality and flows) High Lake Water Quality Model Monitoring

50. Surface Water Quality Issues Water Management Plan –Several concerns have been raised during review of DEIS including lack of detail on: Rationale for assumptions Schematics of water management systems Drainage management systems including sediment and erosion control Proposed treatment systems Monitoring to support adaptive management and system performance monitoring Site water modelling and associated results

51. Surface Water Quality Issues Water Management Plan –Zinifex is committed to providing an updated comprehensive water management plan with supporting detailed model documentation to address these concerns

52. Surface Water Quality Issues Additional 100-year extreme drought scenario - test ability to maintain water cover –Year 20: 1:100 return event = 164 mm Evaporation = 292 mm –Year 21: 1:50 return event = 180 Evaporation = 265 mm –Year 22: 1:10 return event = 216 Evaporation = 240 mm

53. Hydrology and Surface Water Quality