Our approach to tailings storage facility (TSF) risk management at our operated assets is aligned with our standard approach to risk management, assurance and continuous improvement. It is multi–dimensional, encompassing management of controls and governance, with particular focus on four key areas:
- TSF selection (location and type), design and construction
- operation, monitoring and maintenance
- dam safety reviews
- emergency preparedness and response
BHP uses the ‘three lines model’ of risk management to define the roles of different teams across the organisation in managing risk. This sets responsibilities and accountabilities for risk management and provides ‘checks and balances’ to support us in protecting and growing value.
Under this model, the first line of risk management is provided by our frontline employees, operational management and people in functional roles – that is, anyone who makes decisions, deploys resources or contributes to an outcome is responsible for identifying and managing the associated risks with those actions. Our first line operational employees are accountable for the TSF failure risks and implement and periodically verify controls designed to reduce the likelihood and potential impacts of a failure.
Our second line functions, primarily the Resource Centre of Excellence, Tailings Excellence and Risk teams, are responsible for providing expertise, support, monitoring and challenge on risk–related matters, and defining the standard for the management of TSF failure risks. The second line supports the first line by conducting reviews and other assurance activities, which help identify opportunities to improve understanding and management of TSF failure risks.
The third line, our Internal Audit team, is responsible for providing independent and objective assurance over the control environment (governance, risk management and internal controls) to the Board and our Executive Leadership Team. This may include auditing the effectiveness of the standard and their application to TSF failure risks. Additional assurance may also be provided by external audit providers.
The outcomes and actions resulting from the activities at each line are required to be documented, monitored, actioned and communicated on a regular basis to the relevant asset personnel, Accountable Executives, Executive Leadership Team and the Board’s Committees in accordance with operational and governance processes.
Our approach to tailings storage facility risk management
TSF selection and construction
When a new TSF is required, selection and design are integral to ensuring dam integrity. The TSF type and location are selected to minimise impact to people, the environment, infrastructure and community. The TSF detailed design is then guided by performance and design criteria specified by the Global Industry Standard on Tailings Management (GISTM), local regulation and dam associations, including the Australian National Committee on Large Dams and Canadian Dam Association. Quality assurance, quality control and change management across all TSF phases, from selection through to construction, are also critical to maintaining dam integrity.
TSF operation, monitoring and maintenance
Maintaining TSF integrity requires ongoing focus on operating discipline, independent reviews and effective governance. Central to our approach is the recognition that maintaining TSF integrity is a process of continuous assessment for the life of each TSF, including post-closure.
Operation, monitoring, maintenance and review practices must operate according to TSF design requirements and be quality assured and controlled to ensure the TSF is functioning as intended. These processes, which are critical to ongoing TSF integrity, span seven dimensions with the specific details commensurate with the consequence classification and complexity of the TSF:
- Monitoring systems – instrumentation to assess ongoing structural integrity and environmental performance
- Routine inspections – visual inspections undertaken by trained and experienced operators
- Formal dam inspections – more detailed inspections undertaken routinely by the Responsible Tailings Facility Engineer
- Dam safety inspections – annual inspections undertaken by the external Engineer of Record reviewing aspects across TSF integrity and governance
- Dam safety reviews – conducted by an external third party as described below
- Technical reviews –
- Independent Tailings Review Board – a panel of qualified independent individuals established for extreme and very high consequence classification TSFs under specific terms of reference to review aspects such as the status of the TSF, proposed design changes and outcomes of inspections or dam safety reviews
- Senior Technical Reviewer – a single independent reviewer external to BHP for lower consequence classification TSFs rather than a panel of experts
- Tailings governance reviews – internal assurance reviews undertaken by the Tailings Excellence team according to a prioritised schedule, to provide assurance to the Accountable Executives that roles, responsibilities, capabilities, risk management and asset-level assurance for tailings management are effectively designed and implemented
Dam safety reviews
We undertake dam safety reviews as required by the GISTM, with the review frequency informed by the TSFs consequence classification.
Dam safety reviews are detailed processes that involve a review of dam integrity and governance. They include a review of the dam break assessment and consequence classification. The review is led by an external qualified professional engineer, who has the appropriate level of education, training and experience commensurate with the TSF consequence and complexity. They may be supported by other technical specialists from fields such as hydrology, geochemistry, seismicity, geotechnical and mechanical. At the conclusion of the review, the qualified professional engineer is required to sign an assurance statement that includes a comment as to the integrity of the TSF.
Emergency preparedness and response
An emergency preparedness and response plan provides external and internal agencies with the necessary information to mobilise and coordinate resources and equipment in a timely manner, in the event of an emergency impacting, or with the potential to impact, the site and surrounding area.
Our approach to emergency response planning for our TSFs is designed to be commensurate with the level of risk and may include:
- defined roles and responsibilities of response teams
- identifying and monitoring for conditions and thresholds that prompt preventive or remedial action
- assessing and mapping the potential impacts from a hypothetical, significant failure including impacts to people, infrastructure, communities and environment, within and outside the mine site, regardless of probability
- establishing procedures to assist operations personnel responding to emergency conditions at the TSF
- testing and training in emergency preparedness ranging from desktop exercises to full–scale simulations, with desktop and field drills scheduled at a frequency commensurate with the level of risk of the TSF
- engaging, testing and integrating our emergency response plans with external authorities as appropriate, including conducting coordinated drills to ensure readiness and transparency
- engaging with community stakeholders to maintain a shared state of readiness
Tailings storage facilities governance and standards
Effective TSF governance includes clearly defined accountabilities and appropriately qualified personnel appointed to key governance roles.
In accordance with the GISTM, we have adopted a multiple Accountable Executives model, where all appointees are direct reports of our Chief Executive Officer and accountable to the Board’s Sustainability Committee. We have appointed a single Accountable Executive Governance for company-wide TSF governance, fulfilled by our Chief Technical Officer. Multiple Accountable Executives Operations are also appointed - comprising our Regional Presidents and the Chief Operating Officer for operational assets and the Chief Technical Officer for legacy assets. Accountable Executives are accountable for the safety, environmental and social impacts of TSFs.
Frontline employees are the first line under our Risk Framework and are responsible for the day–to–day operations and safety at site, while connected via regular communication to the relevant AE. There are three first–line roles, which we mandate across our operated assets:
- Dam Owner – the single point of accountability for maintaining effective governance and integrity of the TSF throughout its life cycle, and the Accountable Executive Operations delegate for the TSF
- Responsible Tailings Facility Engineer – a suitably qualified BHP individual accountable for maintaining overall engineering stewardship of the TSF, including planning, operation, surveillance and maintenance
- Engineer of Record – an individual external to BHP who is a suitably qualified professional engineer retained by the Dam Owner for the purpose of maintaining TSF design, certifying TSF integrity and supporting the Dam Owner and the Responsible Tailings Facility Engineer on any other matters of a technical nature
TSFs with extreme or very high GISTM consequence classifications will have Independent Tailings Review Boards to strengthen the control environment for TSF failure risks. For lower consequence classification TSFs where an Independent Tailings Review Board is not required, independent, external Senior Technical Reviewers will act in this capacity. BHP assesses the TSF consequence classification, risk, and operational circumstances in determining whether to empanel an Independent Tailings Review Board.
Additional information on our approach to TSF standards and Group–level oversight and assurance is detailed in our TSF management evolution graphic.
For more information on our management of TSFs, emergency preparedness and response, commitment to recovery in the unlikely event of a failure, and transparency refer to our BHP Tailings Storage Facility Policy Statement.