2 SELECTING SITES for REMEDIATION .9 Risk-Based Approach .9 Methodology .0

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(List continues on the inside back cover) WORLD BANK TECHNICAL PAPER NO. 398 PollutionManagement Series

Setting Priorities for Environmental Management An Applicationto the MiningSector in Bolivia

Wendy S. Ayres Kathleen Anderson David Hanrahan

The World Bank Washington,D.C. Copyright X 1998 The International Bank for Reconstruction and Development/THE WORLDBANK 1818 H Street, N.W. Washington, D.C. 20433,U.S.A.

Technical Papers are published to communicate the results of the Bank's work to the development community with the least possible delay. The typescript of this paper therefore has not been prepared in accordance with the procedures appropriate to formal printed texts, and the World Bank accepts no responsibility for errors. Some sources cited in this paper may be informal documents that are not readily available. The findings, interpretations, and conclusions expressed in this paper are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations, or to members of its Board of Executive Directors or the countries they represent. The World Bank does not guarantee the accuracy of the data in- cluded in this publication and accepts no responsibility for any consequence of their use. The boundaries, colors, de- nominations, and other information shown on any map in this volume do not imply on the part of the World Bank Group any judgment on the legal status of any territory or the endorsement or acceptance of such boundaries. The material in this publication is copyrighted. Requests for permission to reproduce portions of it should be sent to the Office of the Publisher at the address shown in the copyright notice above. The World Bank encourages dissem- ination of its work and will normally give permission promptly and, when the reproduction is for noncommercial purposes, without asking a fee. Permission to copy portions for classroom use is granted through the Copyright Clearance Center, Inc., Suite 910, 222 Rosewood Drive, Danvers, Massachusetts 01923,U.S.A.

Cover photo: "Miners in Bolivia," by Wendy S. Ayres.

ISSN:0253-7494

Wendy S.Ayres is an economist in the World Bank's Rural Development Department. Kathleen Anderson is a se- nior fellow at York University's Centre for Applied Sustainability and director of the Mining and Environment Insti- tute. David Hanrahan is an environmental specialist in the World Bank's Environment Department.

Library of Congress Cataloging-in-PublicationData

Ayres, Wendy S. Setting priorities for environmental management: an application to the mining sector in Bolivia / Wendy S. Ayres, Kathleen Anderson, David Hanrahan. p. cm. - (World Bank Technicalpapers; no. 398) Includes bibliographical references and index. ISBN 0-8213-4166-9 1. Abandoned mined lands reclamation-Bolivia. 2. Mineral industries-Capital investments-Bolivia-Cost effectiveness. 3. Company towns-Bolivia. 4. Corporaci6n Minera de Bolivia. 5. International Development Association. I. Anderson, Kathleen A., 1955- . II. Hanrahan, David, 1950- . III. Title. IV.Series. TD195.M5A98 1997 333.8'153'0984-dc2l 9746571 Contents

Page No.

FOREWORD ...... vii

ABSTRACT ...... viii

ACKNOWLEDGMENTS ...... ix

EXECUTIVE SUMMARY ...... 1

1 MINING AND ENVIRONMENT IN BOLIVIA .4 Bolivia and Mining .4 COMIBOL Mining Communities in Western Bolivia .5 Environmental Problems Due to Mining .7

2 SELECTING SITES FOR REMEDIATION .9 Risk-Based Approach .9 Methodology .0

3 IDENTIFYING PRIORITY ACTIVITIES AND INVESTMENTS FOR ENVIRONMENTAL MANAGEMENT .17 Framework .17 Environmental Conditions in Mining Communities in Western Bolivia .22 Choosing Priority Investments and Activities .26 Site-Specific Proposals .27 Caveats .34

ANNEXES

1 Hazard Ranking System with Example .37 2 Rapid Site Assessment .45 3 Chief Pathways and Critical and Background Levels of Key Contaminants .54 4 Calculating a Marginal Cost Curve: Example .56 5 Inventory of Mines and Smelters in Bolivia, Relative Ranking of Mines by Hazard . Potential, and Individual Mine Hazard Scores .60 6 Site Specific Recommendations for Further Investigation for Environental . Improvement ...... 69

BIBLIOGRAPHY ...... 73

iii iv

WORKBOOK ...... 75

TEXT TABLES

1 Summary of pollutants critical to human health .19 2 Drinking water quality in selected mining communities compared with Pan American Health Organization and United States standards.23 3 Heavy metals in soils in Tierra and Luna compared with critical and background levels... 24 4 Heavy metals in crops in Luna compared with critical and background levels .25

TEXT FIGURE

1 Methodology for estimating health benefits from reducing pollution ...... 20

ANNEX TABLES

Al A.1 Mine hazard scoring worksheet.39 A1 B.1 Type of commodity produced .40 A1B.2 Current status .40 AIB.3 Number of years operating.40 A1B.4 Size of production .40 A1B.5 Mill type .40 A1C.1 Exposed population .41 A1C.2 Exposed buildings and materials ...... 41 AIC.3 Sensitivity of exposed ecosystems.41 AID.1 Mine hazard scoring worksheet: Example .44

A2.1 Rapid site assessment form.48

A3.1 Chief pathways of exposure to environmental contaminants .54 A3.2 Critical and background levels of selected metals and chemicals .55

A4.1 Costs and quantities of cadmium reduction: Example .59

A5.1 Inventory of mines and smelters in Bolivia...... 61 A5.2 Relative ranking of mines by their hazard potential.62 A5.3 Mine hazard scoring spreadsheet: Luna ...... 63 A5.4 Mine hazard scoring worksheet: Javiar .64 A5.5 Mine hazard scoring worksheet: Estrella.65 A5.6 Mine hazard scoring worksheet: Jupiter .66 A5.7 Mine hazard scoring worksheet: Venus.67 A5.8 Mine hazard scoring worksheet: Marte smelter.68 v

A6. 1 Recommendations for further investigation: Sol ...... 69 A6.2 Recommendations for further investigation: Luna ...... 70 A6.3 Recommendations for further investigation: Tierra ...... 71

ANNEX FIGURE

A4.1 Cost per kilogram of cadmium removed ...... 59

MAP

Major COMIBOL mining centers in Western Bolivia

Foreword

Mining and industrial activities, if poorly managed, can damage the environment and leave behind contaminated materials which release pollutants for many years after the mines or enterprises have shut down. Cleaning up old mine and industrial sites is often extremely costly. Furthermore, cleaning up the sites may not result in appreciable improvements in human health or the environment. Given resource constraints, what decision rules should guide activities for remediation? Which sites should be addressed first? Which specific actions and investments are likely to provide the greatest benefits for the resources spent?

These questions have arisen in the context of preparing the International Development Association-assisted Bolivia: Environment, Industry, and Mining Project, undertaken to address environmental problems in communities with mines owned and operated by Bolivia's state mining corporation, COMIBOL. The project was in support of the government's efforts to revitalize the mining sector by attracting private sector investment and by transferring operating responsibility from COMIBOL to the private sector. Methodologies were developed for selecting priority sites for remediating environmental problems due to mining and then for choosing specific high priority investments which would provide the greatest benefits for the available resources. This paper describes these methodologies. The methodologies have broad application and can be used to identify priority remediation investments in other sectors or in other countries where there are environmental problems arising from activities of the past.

Robert Watson Maritta Koch- Weser Director Director Environment Department Environmentally and Socially Environmentally and Socially Sustainable Development Sustainable Development Latin America and the Caribbean Region

vii Abstract

This paper addresses the question of how to set priorities for environmental remediation. It offers a practical approach for selecting priority sites. And it provides a framework for choosing priority investments and activities for environmental management more broadly, if resources are not earmarked for remediation. A workbook illustrates with examples how to calculate the benefits of potential investments and activities, and weigh these benefits against costs.

The paper arose from work the authors conducted while preparing an environment and mining project for Bolivia, financed by the International Development Association of the World Bank Group. While the paper focuses on Bolivian mining communities, its approach is applicable to a wide-range of problems and communities.

viii Acknowledgments

The authors wish to thank Christopher Barham and Krishna Challa of the World Bank who supported this work from its inception. The authors also wish to thank Norman Hicks, Luis Hidalgo, David Hughart, Dianne Hughes, Gordon Hughes, Andres Liebenthal, Alberto Nogales, Dan Morrow, Felix Remy, Jennifer Sara and Gotthard Walser of the World Bank, Marco Giussani of COMIBOL, Fernando Loayza and Antonio Bojanic of the Bolivia Secretariat of Mines, Robert Toth of R. B. Toth Associates, and many others many others for invaluable advice and guidance. The views presented here are the authors' alone and should not be attributed to the World Bank or its member governments.

Executive Summary

MINING AND ENVIRONMENT IN BOLIVIA

Past mining activities in Bolivia have caused considerable environmental damage which may be posing a risk to human health, ecosystems and economic infrastructure. Due to a change in economic policy, coupled with a collapse in tin and other metals prices in the mid-1980s, Bolivia's state-owned mining sector is undergoing a major restructuring. The state mining corporation, Corporaci6n Minera de Bolivia (COMIBOL), has closed a number of mines and introduced major changes in the operations of others. It has also reduced its labor force significantly. COMIBOL mines with the potential of being profitable are being offered for private participation, a process called capitalization. As part of this process, COMIBOL plans to address environmental damage resulting from its past mining activities. The International Development Association (IDA) of the World Bank Group is supporting this effort through the Environment, Industry and Mining Project, which started in 1996. However, the cost of cleaning up past contamination at all COMIBOL's sites would be enormous - clearly much more than the country could afford to pay, given its many other pressing needs. Furthermore, based on experiences in the United States and elsewhere, it is by no means certain that cleaning up past contamination would result in improved health or environmental conditions.

This paper grew out of work done to assist COMIBOL in identifying how best to use finite financial resources specifically targeted for remediation of environmental contamination associated with mining. In the first part of the paper we address the question of how to set priorities for environmental remediation: given the wide-range of mining-related environmental problems in the region, what principles should guide and inform decisions on which sites to clean up first, how much to clean them up, and how to clean them up. In the second part of the paper we relax the constraint that financial resources must be dedicated to the remediation of mine waste, and we take on the question of how to set priorities for environmental management in general. While the paper focuses on Bolivian mining communities, its approach is applicable to a wide-range of problems and communities. A workbook with detailed examples of how to carry out the calculations appears following the annexes.

RANKING SITES FOR REMEDIATION

Mining sites differ with respect to their potential to damage human health, ecosystems, and economic infrastructure - even if the extent and nature of their contamination is similar. The 2 Setting Priorities for Environmental Management. Mining in Bolivia differences arise mainly from the mine's proximity to population centers and the geological, climatological and hydrological conditions of its setting. Given the differences, it makes sense to remediate the mine sites posing the greatest risks first, leaving remediation of those presenting smaller risks for later, when additional resources become available.

Chapter 2 of this paper presents a methodology for ranking mine sites with respect to their potential to cause harm. The methodology addresses environmental problems arising from historic mining activities. It is assumed that environmental issues associated with active and proposed mines will be addressed under the prevailing regulatory regime and in site specific permit negotiations.

Risk-based approach

Broadly, the approach presented here involves addressing mine sites according to the risk that they pose to people, economic infrastructure and ecosystems. The chain of logic is consistent with standard risk assessment, involving identifying the main health and environmental impacts, focusing on the sources of the pollutants, and then developing cost-effective methods to reduce the pollution loads and therefore the exposure levels and risks.

The risk-based approach differs from the standards-based approach, which is widely followed in the United States and Western Europe. With the standards-based approach, all properties must be cleaned up to meet a particular environmental standard, regardless of whether the contamination is threatening human health or causing significant environmental or economic damage. Thus an isolated desert property is required to be cleaned up to the same standards as one in a densely populated city. Such an approach almost never results in an efficient use of resources. The risk-based approach, by contrast, specifically targets those investments and activities likely to provide the greatest benefits for the money spent.

SELECTING PRIORITY INVESTMENTS AND ACTIVITIES FOR ENVIRONMENTAL MANAGEMENT

In the mining communities of Western Bolivia, as in every community throughout the world, there are numerous types and sources of environmental contamination which may pose a risk to human health, economic infrastructure and ecosystems. Many of these problems will be unrelated to contamination from mining, although they may receive less attention because they are so common. Which problems and sources should be addressed first? Which activities and investments will provide the largest benefits for the resources used? How should investment choices be made in cases where there are few or unreliable data? Chapter 3 of the paper provides a framework for setting priorities for environmental management within mining communities- these priorities may or may not involve remediating contamination from past activities. Executive Summary 3

Calculating benefits

The highest priority activities and investments are those which provide the greatest benefits for the resources spent. Calculating the benefits involves estimating a relationship between a reduction in environmental hazards at a particular site or from a specific source and its likely effects on human beings, infrastructure, or ecosystems. The next step is to value this physical damage in monetary or economic terms.

In Bolivian mining towns the most serious problems are likely to be microbiological contamination of drinking water, lead in various media, airborne dust, and possibly cadmium and arsenic in the environment. If there are available reasonable-cost investments activities or investments which reduce the incidence of water-borne diseases, cases of elevated blood-lead, and morbidity and mortality associated with exposure to airborne dust or heavy metals, these are likely to provide significant benefits to human health and the economy.

For many Bolivian mining towns, remediating contamination from past mining activities may not be a cost-effective solution to reducing the most immediate risks to health due to environmental pollution. For example, it may be more cost-effective to provide drinking water from deepwater aquifers than to remediate all sources of acid rock drainage that are making surface water bodies unfit for drinking water. Furthermore, many rivers in the Altiplano contain very high natural levels of arsenic, lead and copper, so remediating sources of contamination will not make their water any more usable for drinking. To reduce exposure to airborne dust, it may be both more effective and lower-cost to seal or pave urban roads than to cover or move tailings piles. Paving the roads would provide, in addition to health benefits, the benefits of lower transportation costs, reduced cleaning costs and the amenity values associated with having cleaner air.

The primary reason to remediate past contamination from mining is often to protect ecosystems rather than to protect human health. However, restoring aquatic ecosystems is often very difficult to achieve: it may be necessary to completely (or nearly so) remediate a very large percentage of all the sources of contamination - including nonmining sources -before the streams or rivers could support breeding populations of fish. Attaining this goal would require the remediation, control and management of all sources of pollution within a watershed (of course measures to protect human health would also contribute to protecting aquatic habitats). While there are many long-term benefits to restoring ecosystems, these benefits may take decades to realize, and are extremely costly to implement.

Still, remediation activities may be worthwhile in some places. Where acid rock drainage is clearly damaging infrastructure, such as in Sol, there may be low-cost activities which can reduce this damage. Where groundwater or sensitive ecosystems are threatened, it may be worthwhile to try to prevent further damage. 1 Mining and Environment in Bolivia

Past mining activities in Bolivia have caused considerable environmental contamination which may be posing a risk to human health, ecosystems and economic infrastructure. Due to a change in economic policy, coupled with a collapse in tin and other metals prices in the mid-1980s, Bolivia's state-owned mining sector is undergoing a major restructuring. The state mining corporation, COMIBOL, has closed a number of mines and introduced major changes in the operation of others. It has also reduced its labor force significantly. COMIBOL mines with the potential of being profitable are being offered for private participation, a process called capitalization. As part of this process, COMIBOL, with the assistance of an IDA credit, plans to address environmental damage resulting from its past mining activities. The purpose of this paper is to assist COMIBOL to identify the sites which should be addressed first and the activities and investments that should be undertaken at these sites. However, the approach in the paper has broad application and could be used to identify priority remediation investments in other sectors or in other countries where there are environmental problems arising from past mining or similar activities.

BOLIVIA AND MINING

Bolivia is one of the poorest countries in South America, with a per capita annual income of less than US$800. It has a population of about 7.1 million people, 60 percent of Indian descent. Bolivia is a country of great physical and climatological contrasts. The capital, La Paz, is at an altitude of nearly 4,000 meters and is flanked by snow-capped mountains. The second largest and the fastest growing city, Santa Cruz, is situated only 300 meters above sea level at the headwaters of the Amazon.

The history of Bolivia is closely tied to mining. The local people mined silver and gold in the Altiplano before the arrival of the Spanish. In 1545 the Spanish discovered the Inca mines of Cerro Rico (Rich Hill) in Potosi, and began to extract huge quantities of silver. In the seventeenth century Potosi was one of the three largest and most prosperous cities in the world; its silver contributed greatly to the development of Europe. In the centuries that followed a number of other major mines were developed, initially to extract silver, and more recently to exploit lead, zinc, tin, and gold.

4 Mining and Environment in Bolivia 5

Nationalization of mines

By the middle of the twentieth century, three barons controlled the major mining areas, one of whom was reputed to be the richest man in the world at the time. However in 1952 a popular revolution overthrew the government, nationalized the tin mines, carried out agrarian reform and proclaimed universal suffrage. Mining provided a significant part of Bolivia's export earnings over the next three decades, but in the mid- I 980s the tin cartel collapsed and with it the price of tin.

Shortly thereafter, the government began to restructure COMIBOL, the state mining corporation. COMIBOL closed most of its uneconomic mines and greatly reduced the workforce at others. Many of the miners who lost their employment with COMIBOL became independent contractors affiliated with state sanctioned cooperatives (cooperativas). These workers (called cooperativistas) mine some of the lower grade deposits adjoining the mines or within abandoned mines, and rework some of the tailings heaps using their own materials and tools.

Capitalization program

The government is now embarking on a program to attract new private investment to those COMIBOL mines which have sufficient reserves to be operated profitably. COMIBOL will no longer operate the mines, but will serve as an administrative body. The International Development Association (IDA) of the World Bank is assisting COMIBOL and the Secretariat of Mines in the capitalization process through the Mining Sector Rehabilitation Project. In a supplemental activity intended to support the capitalization program, IDA is providing assistance through the Environment, Industry, and Mining Project, which will address environmental damage arising from historic mining activities.

COMIBOL MINING COMMUNITIES IN WESTERN BOLIVIA

The COMIBOL mining centers that are covered by the Environment, Industry, and Mining Project include Oruro (San Jose mine), Potosi (Unificada mine), Llallagua (Siglo XX mine and Catavi smelter), Santa Fe, Huanuni, Colquiri and Caracoles (see map). Since much of the environmental data in this paper are not public information, the mining centers will hereafter be referred to by pseudonyms to protect their identity.

The mining communities vary considerably in their size, environmental conditions, proximity to markets, and potential to develop alternative industries and sources of employment. Some COMIBOL mining communities, such as Sol, are relatively large urban centers, with diverse sources of employment and good transportation links. Others, such as Nube and nearby settlements, are small, relatively isolated communities with few sources of alternative employment. Some of the mines will be attractive to new investors: Luna and Tierra appear to contain rich reserves of tin and tin/zinc which may potentially be exploited profitably. Others 6 Setting Priorities for Environmental Management: Mining in Bolivia

will not attract new capital but will be worked by small-scale miners using primitive technologies and earning very small incomes. Because the communities vary so extensively in their environmental and socioeconomic conditions, it will not be possible to suggest general remediation investments that will make sense for all. Instead, investment programs must reflect the unique conditions prevailing in each of these communities.

Characteristics of hard rock mines

The typical large mine in the Altiplano covers an area of several square kilometers, and has a number of passages (tunnels or adits) into the ore body, a haulage system (rails or road), usually one or more concentrator plants, a number of heaps of mine or concentrator wastes, and perhaps a tailings dam. The mine operations also normally include offices and workshops. The mining area generally includes settlements with housing for workers and their families, shops, health facilities, schools and other urban amenities. These settlements may or may not be owned by the mine. In some cases where mines have been closed or their workforce reduced, the number of cooperative workers or informal miners living in a community can be ten or twenty times the size of number of persons employed by COMIBOL.

Hard rock mining in the Altiplano has traditionally been underground mining with low levels of mechanization. The major economic ore bodies are made up of complex non-ferrous metals, usually with a sulfide matrix. Extracted ores usually undergo some level of processing or concentrating near the mine. Processing facilities range from very small artisanal operations relying on primitive techniques, to large relatively modern smelters.

In addition to hard rock mining, Bolivia has a growing informal gold-mining sector, which operates primarily, but not exclusively, in the Amazon basin. The Environment, Industry and Mining project is not dealing with the informal gold mining sector.

Natural environment of the Altiplano

Bolivia's environment can be categorized into three major ecological zones: the Altiplano, the Amazon basin, and the fertile slopes of the Cordillera in between. Since most hard rock mining takes place in the Altiplano, this is the area that is the focus of the Environment, Mining and Environment Project.

The Altiplano is a cold, arid highland plateau with an average altitude of 4,000 meters. About 70 percent of Bolivia's citizens live here, surviving on subsistence agriculture, llama and sheep herding, and whatever other sources of income that they can find. Mining has traditionally been an important source of income for the region's inhabitants, and despite the rigors and uncertainty of mining work, it is still an important part of life. There are a number of small towns and villages throughout the Altiplano. The main mining centers are Potosi and Sol, both of which are capitals of departments of the same name. Mining and Environment in Bolivia 7

In hydrologic terms, the Altiplano is an enclosed basin, which receives outflows from Lake Titicaca and seasonal flows from mountain rivers. The flows end in the Lake Poop6 system or in the salt flats (salars). The quantity of water in the system can vary greatly, both seasonally and over longer cycles of years or decades. Some of the mines on the edges of the Altiplano are near the continental divide. There are major mines near the headwaters of the Amazon and the Parana and Paraguay River systems.

ENVIRONMENTAL PROBLEMS DUE TO MINING

Historically, mining activities have created numerous sources of contamination which affect surface water (and in some cases, groundwater), air and soil. Tailings from the mills, waste rock, underground and open pit mine workings, roads, wastewater ponds, landfills, and smelters are among the sources which have the potential to discharge mining-related pollution into the environment. Of particular concern in Western Bolivia are those sources which generate very low-pH water (acid rock drainage or ARD). Acid rock drainage is a naturally occurring process which can be greatly exacerbated by mining due to the increased exposure of rock to air and water. It may discharge from tunnels and mine entryways (adits), seep from the toe of tailings and waste rock piles, or run off from roads and dams which have been constructed with waste materials. Acid rock drainage is a concern because it dissolves and transports metals, such as lead, arsenic, cadmium, and zinc, which may pose a threat to human health and the environment. Furthermore, very low-pH water is lethal to most aquatic organisms. In Bolivia, it is quite common for the drainage from the mine or the dumps to have a pH of 3 or less and to contain high concentrations of metals and metalloids such as lead, silver, cadmium, and arsenic. At some mining centers in Bolivia, acid rock drainage has destroyed aquatic ecosystems for up to twenty kilometers downstream from the sources of discharge. The nature, extent, and impact of acid rock drainage varies greatly, however. The environmental degradation associated with acid rock drainage is determined by many factors, including water chemistry in receiving streams and rivers, dilution and temperature.

Ore processing or concentration activities can also generate pollution. Mineral processing uses chemicals (reagents), such as cyanide and mercury, which may be hazardous to human health and the environment. Concentrating or processing the ores typically involves wet processes such as flotation or leaching which may also utilize cyanide or mercury, among other chemicals. If wastewater from these processes is not properly managed, it can contaminate the environment, threatening human health, and animal and aquatic life.

Communities have used mine waste material extensively to build impoundments, roads, and common areas such as playgrounds and sports fields. Many of these structures continue to release metals through the acid-generating process. Inhabitants frequently come into direct contact with the mine waste; children play on or adjacent to tailings and waste rock piles, and residents build houses directly on old tailings. However, it is important to note that contact - 8 Setting Priorities for Environmental Management. Mining in Bolivia

even direct contact - does not presuppose risk. Mine waste is highly variable, both in toxicity and in bioavailability. For example, some forms of arsenic or of lead are not readily absorbed into the human body, and therefore do not pose a significant risk to human health. In addition, some heavy metals or metalloids may not harm human health until persons have been exposed to a threshold level. Exposure to the element at quantities below the threshold causes no damage at all. Recent evidence suggests this is the case with arsenic (Wildavsky, 1995).

Air pollution due to mining generally arises through the release of dust from the transport, handling and processing of ore, and from dust blown from the heaps of fine tailings. Smelters may also contribute significantly to air pollution. Poorly managed smelters may emit high levels of metal-bearing dust and gases containing high levels of volatilized metals (such as arsenic) which later condense into fine particulates (of serious concern from a health point of view). In addition, poor dust control within the plant can allow fugitive dust to escape into the atmosphere in quantities equal to or greater than the levels emitted from the stacks.

Finally, mining can leave behind many physical hazards. Tunneling disturbs the landscape and can result in erosion, landslides, land subsidence and unstable ground. Uncontrolled mine openings can be dangerous to humans or animals. Mining uses explosives, chemicals and machinery, which if improperly disposed of can endanger persons or livestock with access to the site. 2 Selecting Sites for Remediation

Mining sites differ with respect to their potential to damage human health, ecosystems, and economic infrastructure - even if the extent and nature of their contamination is similar. The differences arise mainly from the mine's proximity to population centers and the geological, climatological and hydrological conditions of its setting. Given the differences, it makes sense to remediate the mine sites posing the greatest risks first, leaving remediation of those presenting smaller risks for later, when additional resources become available.

The methodology for selecting priority mine sites presented here has been developed to provide a reasonably rigorous and systematic way to identify the sites where environmental damage from past mining activities may be imposing significant human and economic costs. The approach is intended to improve the chances that scarce resources are used in the best possible way.

The methodology addresses environmental problems arising from historic mining activities. It is assumed that environmental issues associated with active and proposed mines will be addressed under the prevailing regulatory regime and in site specific permit negotiations.

RISK-BASED APPROACH

The approach presented here is consistent with standard risk assessment, involving identifying the main health and environmental impacts, focusing on the sources of the pollutants, and then developing cost-effective methods to reduce the pollution loads and therefore the exposure levels and risks. The risk-based approach differs from the standards-based approach, which is widely followed in the United States and Western Europe. With the standards-based approach, all properties must be cleaned up to meet a particular environmental standard, regardless of whether the contamination is threatening human health or causing significant environmental or economic damage.

Thus an isolated desert property is required to be cleaned up to the same standards as one in a densely populated city. Such an approach almost never results in an efficient use of resources. The risk-based approach, by contrast, specifically targets those investments and activities likely to provide the greatest benefits for the money spent.

9 10 Setting Priorities for Environmental Management: Mining in Bolivia

METHODOLOGY

The methodology comprises four principal stages:

1. Screen all sites and produce an initial ranking of their hazard potential, based on minimal data.

2. Identify priority sites for remedial action based on data obtained in short visits to the sites (and their surroundings) identified in Stage I as most likely to be hazardous. Define data needs for more complete assessments of the impacts of the hazards and sources of damage.

3. Carry out audits on high priority properties (where these are not being done by COMIBOL as part of the capitalization program) to ascertain the nature and extent of the hazards.

4. Determine appropriate actions at each of the priority sites, based on estimates of the benefits of reducing environmental contamination and on the costs of alternative actions for reducing contamination. The environmental audits being carried out by COMIBOL on its productive mines will provide information useful in identifying the priority investments and activities. Details of how to set priorities at individual sites is presented in chapter 3.

The outcome is a list of possible remediation actions, ranked (or grouped) by their likelihood to provide significant benefits for the resources spent. This list can then be used as part of a broader decision making process to allocate available funds.

Stage 1 Initial screening and ranking

la Preparing an inventory of sites

The first step in selecting priority sites for remediation is to compile an inventory of all sites under consideration, which in this case are those where COMIBOL has been active in mining, including sites that are abandoned or contain abandoned portions, as well as mines that are currently operating. This inventory should be as detailed as possible using readily available information from published sources or databases. The inventory should include as much information as possible on the following characteristics:

* Exact location * Type of operation (underground, open pit) * Current status (operating, abandoned) * Type of commodity produced Selecting Sites 11

* Minerals present on-site (including minerals surrounding the ore body and in waste rock) * Types of minerals or chemicals likely to be present in the ambient air or water * Dates of discovery, production, closure * Years of operation * Mine size (surface area, volume of ore production) * Existence of processing facilities on or near the site * Predominant methods for mining, milling, and mill processing (mill type) * Human settlements near the site: population, economic activities * Water resources on or near the site * Ownership structure, including description of cooperative activity. lb Ranking sites by their hazard potential

The next step is to rank the sites according to their potential to damage human health and economic infrastructure and ecosystems. A scoring system has been developed to allow consistent comparisons to be carried out. Each site identified in the inventory is assigned a numeric hazard value. These numbers are derived from values based on particular site characteristics, for example:

* Number of people living in proximity to the mine (number of people potentially exposed to hazardous levels of heavy metals or chemicals) * Likelihood that metals and chemicals present at the site could damage human health * Likelihood that metals and chemicals present could harm ecosystems or economic infrastructure * Existence of physical hazards (dangerous mine openings, unstable ground, unstable waste rock piles or tailings dams, and the like).

The sites ranking the highest after this initial screening are the priority sites for further investigation.

Annex 1 provides a detailed presentation of the method for assigning hazard scores to individual mines and a simple spreadsheet for calculating the total hazard value. Annex 1 also contains an example of a completed spreadsheet for Tierra mine based on data in the Tierra environmental audit.

This ranking system provides a method for comparing sites with respect to their potential to be causing human health and environmental damage. The values produced are not absolute but do provide a robust and consistent estimate of relative hazard potential. The numerics also provide a rough ranking of the individual hazards at a specific site. Annex 5 contains an inventory of the key mines in Bolivia, a table with the relative ranking of the mines by their hazard potential, and hazard scoring spreadsheets for individual mines. 12 Setting Priorities for Environmental Management: Mining in Bolivia

Stage 2 Investigating priority sites

Stage 2 involves visiting the sites that have been identified in Stage 1 as "priority sites" in order to confirm the initial assessment and to assess the nature and extent of hazards present that may warrant remediation. Sites judged to pose serious dangers are targeted for more complete environmental audits.

2a Rapid environmental assessment

The initial visits provide quick overviews or "rapid environmental assessments" of site conditions, based on visual inspection and collection of immediately available information. It is intended that the assessments should last no longer than a day or two. The field workers should record the physical conditions at the site, note any evidence of chemical contamination and should provide a first estimate of the severity of the danger to human inhabitants or to the environment. It is essential that the assessment cover not only the site itself but also the areas surrounding the site which may have been affected by contamination from the mine.

A first step in the site visit is to prepare a map showing the boundaries of the mine property (if possible) as well as important features that exist inside and outside the boundaries of the mine property and which may be affected by contamination generated by current or past mining activities.

Annex 2 contains a worksheet with the features and conditions to note during the site visit. Using this worksheet for guidance, the assessors should collect as much data as possible on the nature of the hazards, sources of contamination, and receptors of pollution.

2b Identifying pathways of exposure and areas of impact

A critical task for the assessment is to estimate the potential pathways of exposure and the number of people likely to be exposed to contaminants. These data will help in estimating the potential benefits of reducing pollution flows or cleaning up contamination from past mining activities.

For example, the field workers should note whether people are growing crops near smelters, are irrigating land with water that drains from the mine, or eating fish from water bodies affected by mine drainage or the runoff from ore processing. In each case, a best estimate should be made of the relevant numbers: hectares of crop land, quantities of fish caught, and numbers of persons eating the fish. Annex 3 Table A3. 1 summarizes the chief pathways through which persons are exposed to hazardous minerals and chemicals. Selecting Sites 13

Stage 3 Ascertaining the nature and extent of the environmental damage at a site: Detailed site assessments or audits

Sites judged to be a source of serious damage are targeted for a more complete assessment of environmental conditions (usually called an "audit"). In addition to providing information on the sources of pollution and possible remediation options, these audits should provide as much detail as possible on the human and economic impacts of the contamination. The audits must include impacts occurring outside the mining property (off-site effects). The main economic impacts to consider are damage to human health, materials damage, and ecosystem damage.

3a Collecting data on impacts of past mining operations

Human health

Physical hazards. Accidents are the major cause of injury or death on mine sites. Especially at old sites, there are numerous physical hazards which threaten the health and safety of people. It is often difficult, if not impossible, to prevent access to sites by children, vandals and others who are either unaware of the hazards or lack the training needed to deal with them appropriately. Hazards at mine sites are relatively simple to identify. The auditors should make note of as many of the site's physical hazards as possible.

Pollution. By far the best way of ascertaining whether environmental pollutants are actually damaging human health is to collect clinical health data. The existence of metals in the environment does not necessarily mean that these are causing illness or death. Not all species of metals are equally bioavailable, and exposure to those that are not will not generally damage health.' Furthermore, people's exposure to pollutants can vary greatly depending on their lifestyle. Having clinical data on body burdens of metals can allow decisionmakers to target particular populations for protection and sources of pollution for remediation, thereby potentially saving enormous resources. Simple and inexpensive techniques exist which allow clinicians to collect information on lead in blood, arsenic in urine or hair, cadmium in urine, and mercury in hair or blood. Therefore, if at all possible, auditors should collect clinical health data. These data also provide baselines which can be used to monitor the effectiveness of future remediation programs. Information on sicknesses or deaths resulting from exposure to pollutants would also be valuable.

It is also important to obtain information on levels of a contaminant in the air, water, food or soil, where these are important sources of human exposure. In the case of lead, the chief routes of exposure are inhalation or ingestion. Most persons receive their largest daily intakes through food. However, for persons living near busy roads or near point sources such as smelters,

I Speciesrefers to the varietyof physico-chemicalforms which metals may take, affectingtheir mobilityand solubility. Bioavailabilityrefers to the abilityof a biologicalorganism to take up the metal. 14 Setting Priorities for Environmental Management: Mining in Bolivia inhalation may be the key source of exposure. Children may receive large doses of lead by ingesting contaminated soil or dust. Exposure to cadmium comes mainly through ingesting food or drinking water containing cadmium. Food crops grown on contaminated soils may contain high levels of cadmium. Cadmium may also be present in the air, especially near zinc or lead production plants. For arsenic, the major routes of exposure are inhalation or ingestion. In mine drainage areas, a major route of exposure may be drinking water. Near smelters or mines, air may contain high concentrations of arsenic. Fish, especially bottom-feeders, may be an important route of exposure in some areas. The primary source of mercury exposure for humans is by consuming fish. Persons may also be exposed to mercury vapor in the air near smelters. Exposure to high levels of zinc, silver, or other heavy metals, comes mainly through ingestion of food or drinking water. Finally, exposure to cyanide occurs mainly by direct handling of the solution. Information on contamination of particular environmental media is essential for designing sensible remediation programs. Table I presents a summary of the pollutants critical to human health, table A3.1 shows their chief pathways of exposure, and table A3.2 contains information on background and critical levels of the key pollutants.

Economic infrastructure and agriculture

Field workers should note any evidence of damage to economic infrastructure being caused by exposure to mine-related pollution. They should record evidence of agricultural activity within or near the mining property. Where there is farming, analysts should collect data on average yields. Finally, analysts should test crops for the presence of heavy metals.

Ecosystems

Mine-related pollution can affect ecosystems in numerous ways. Analysts should test streams and waterways for both physical and chemical changes which can diminish the viability of the aquatic ecosystem, and indicate the length of river affected. Because impacts may vary substantially with dilution, temperature, flow rate and other factors, they should test streams at both high and low flow. They should test fish and plant life for heavy metal contamination, and sample soils in stream and river beds for the presence of heavy metals. Observers should also note whether runoff from roads or periodic releases from dams is increasing turbidity in waterways, which can affect aquatic habitats and breeding grounds. Analysts should be sure to note the many climatic, topographic and other natural factors which may influence ecosystem health, unrelated to peoples' activities. They should also note historic uses of lands abutting the streams and waterways.

3b Estimating the marginal costs of remediation at a mine

The audits should include information on the costs of alternative remediation measures along with the likely impacts of the proposed measures. For example, containment may be a relatively low-cost action for reducing leaching of metals from old tailings dams. Thus the audit should Selecting Sites 15 provide an estimate of the costs of containment, the impact this will have on metals leaching from the dam, and finally the impact this will have on ambient water quality and on aquatic life in the affected river. As another example, diversion of acid mine drainage through cement channels may redirect low pH water away from sensitive areas. The audit should then include estimates of the way this action will reduce the impacts (for example, pipe corrosion) associated with exposure to acid mine drainage. The purpose of the exercise is to identify a range of options of different costs which have varying impacts on human health and the environment.

Example. The marginal costs of reducing discharges to the environment

In Bolivia, discharges from mining activities may be contaminating streams, rivers, and underground aquifers. The pollutants of concern are principally heavy metals and acidity itself, although chemical reagents such as cyanide may be released into the environment. In addition, heavy sediment loads can disturb ecosystems of the receiving water bodies.

The environmental audit of the Tierra mine identifies a number of sources of contaminants entering water bodies. These are:

DDrainage water from mine dumps DDrainage water from galleries X Drainage from the tailings dam.

Flows from these sources contribute to a greater or lesser degree to pollution loads in the rivers draining the mine area and possibly to groundwater pollution. To identify cost-effective containment and remediation activities, the approach is to identify the pollutants which are causing damage (assumed on present evidence to be principally the heavy metals), estimate the extent of the damage, and rank measures which would reduce pollution flows from these sources according to their costs per unit of pollution avoided. Annex 4 contains an example of the calculation of a marginal cost curve.

Stage 4 Choosing remediation measures at priority sites

Selecting remediation actions involves a judgment of both the benefits and costs of remediation. High priority investments and actions are those which provide the greatest benefits for the resources used. Typically there will be a number of relatively low cost actions which have a significant effect on the release of pollutants and these should be selected as the first actions to be undertaken. An example might be diverting acid drainage away from sensitive areas. To the extent possible, the analyst should rank all possible actions at a site for which marginal benefits (that is, the additional benefits after all the previous actions have been implemented) exceed marginal costs. The highest ranking projects are those with the largest net present value. This list then represents the eligible actions at the site, but it does not mean that all of these actions will necessarily be undertaken. 16 Setting Prioritiesfor Environmental Management: Mining in Bolivia

There is a considerable uncertainty about many of the elements of the selection process: the benefits are difficult to quantify; the pathways of exposure and the effectiveness of actions in reducing the exposure are often uncertain; and the costs of the actions are always subject to a number of influences. A level of professional judgment will therefore be necessary to identify effective remediation actions and assign them priority. Still, it should be possible to roughly identify those actions and investments which will provide the greatest environmental improvements for the investment required. Details on how to compute benefits of environmental improvements are presented in chapter 3.

4a Establishing priorities across sites

Comparing actions across sites is even more difficult than setting priorities within a site. It requires a common measure of benefit, which in ideal conditions would be the net present value of the action. Even where precise net present values cannot be calculated, it will often be clear that some actions will provide much greater benefits than others. For example, actions which reduce damage to human health will normally have priority over those which reduce damage to ecosystems, especially in poor countries. Actions which reduce health risks to large populations will usually have higher priority than those which will reduce risks to only a few people. 3 Identifying Priority Activities and Investments for Environmental Management

FRAMEWORK

In any community worldwide, there are numerous types and sources of environmental contamination which pose a risk to human health, economic infrastructure, and ecosystems. If finite resources can be used for activities and investments which generate the greatest benefits regardless of the cause of environmental damage, how can priorities be set? Which problems and sources should be addressed first? Which activities and investments will provide the greatest benefits for the resources used? How should investment choices be made in cases where there are few or unreliable data? The purpose of this chapter is to provide an approach to identifying high priority activities and investments for environmental management within communities. In the context of the Bolivia Environment, Industry, and Mining Project the question is: what activities and investments should be undertaken on the sites identified as priority sites? This section proposes an approach which considers both the environmental and economic benefits and costs associated with controlling exposure to environmental hazards. The workbook at the end of the paper illustrates the approach with analyses of typical problems.

Characterizing environmental conditions

The first step is to characterize environmental conditions in the local area under consideration. What are the major pollutants contaminating the air, water, soil, and food? If there are reliable data, answering this question is straightforward. However, if there are not, as is often the case, considerable judgment will be required. Still, it is usually possible to make reasonable hypotheses based on information on factors such as major economic activities in the area, enterprises in operation, whether or not leaded gasoline is used, the main source of heating fuel, and the percentage of households with access to clean water near their homes. The second step is to identify the pollutants which are expected to be truly hazardous to human health at levels found (or likely to be found) in the local area. Efforts to collect more and better data should be focused on the critical pollutants, to establish whether they are indeed posing a risk to human health.

The next step is to calculate the potential benefits to health, economic infrastructure, and ecosystems that would arise from reducing environmental hazards. This involves estimating a

17 18 Setting Priorities for Environmental Management: Mining in Bolivia relationship between a reduction in environmental hazards at a particular site or from a specific source and its likely impact on human beings, infrastructure or ecosystems. Analysts might ask, for example, how many fewer cases of illness would occur if sulfur dioxide emissions from a power plant were eliminated. This is known as estimating the damage function. The final step is to value the physical damage in monetary or economic terms.

The general idea is to have some estimate of the benefits if an environmental hazard can be reduced. These can then be compared to the costs of reducing or eliminating the hazard. The priority activities or investments are those which produce the greatest benefits for the resources used.

Estimating benefits from pollution control

Human health

People in poor communities are often exposed to environmental hazards which make them sick or even shortens their lives. For example, drinking contaminated water is a leading cause of illness and premature death, especially among children, in many low-income countries. In parts of the world where leaded gasoline is still predominant, children may be exposed to high levels high levels of lead. Exposure to lead irreversibly impairs children's intellectual and emotional development, and very likely permanently reduces their lifetime earnings capacity. The first priority in any program to improve the local environment should be to protect human health.

Critical pollutants. The human health impacts due to exposure to various pollutants range from minor discomfort to reduced life-expectancy. The pollutants likely to be causing the greatest health damage in Bolivian mining communities are microbiological contaminants of drinking water, lead in soil, water, air, and food, suspended particulate matter in air, and cadmium, arsenic, and possibly mercury in food, soil, and water. Table 1 summarizes the impacts and chief exposure routes of the critical pollutants.

Determining the extent and severity of human health impacts due to environmental contamination is a difficult and complex task. Ideally, the analyst would have detailed data regarding ambient concentrations of contaminants for each of the potential exposure pathways, and a dose-response function linking exposure to health impacts. For example, if we know that (1) lead in ambient air averages 3 micrograms per cubic meter; (2) each microgram in air contributes 3.9 micrograms lead per deciliter of blood; and (3) each microgram of lead per deciliter of blood results in cognitive damage measured as an IQ loss of .25 points, then we can estimate the health benefits from reducing lead in air. With information regarding the size of the exposed population and the extent of the exposure, we can estimate the total burden of disease in the population that breathes the air. To estimate the full health impacts from environmental pollution, we would repeat these steps for all potential contaminants and all potential pathways. The approach is summarized in Figure 1. Identifying Priority Activities and Investments 19

Table 1 Summary of pollutants critical to human health

Contaminant Population Health impact Chief pathways of at risk exposure

Lead Children, Subtle brain damage and learning disorders, Soil, air, especially under including lower lQs, impaired attention, drinking water, age 7 speech and language deficits, and behavior food disorders

Microbiological contamination Entire Diarrheal diseases and enteric fevers, Drinking water of drinking water population, cholera, hepatitis A especially children

Particulate matter (particles Entire population Acute and chronic respiratory diseases, Air below 10 microns) cancer, early death

Heavy metals and metalloids (other than lead)

Mercury Entire population Poisoning, early death Air, fish

Cadmium Entire population Renal dysfunction Food, drinking water, soil, air

Arsenic Entire population Poisoning, skin cancer (which is easily Food, drinking detected and often reversible), liver water, soil, air dysfunction, vascular disturbances, lung cancer' a/ The association between exposure to arsenic and lung cancer is suspected but not certain. In any case, Bolivians have life expectancies of around 60 years, so the chronic, cancer-related diseases associated with exposure to heavy metals and metalloids, which affect primarily older people, may be very difficult to detect. Source: World Health Organization Regional Office for Europe 1987; Hutchinson and Meema 1987; Viessman and Hammer 1985.

Valuing health damage. Estimating the value of health damage from exposure to environmental degradation generally involves estimating the cost of treating a particular illness, the value of time lost of either the affected individual or a caretaker, and the reduction in well-being experienced by the afflicted individual and his family and friends. Typically, costs would include the costs of visiting a doctor or nurse, the cost of medications, wages lost due to days off from work, and demonstrated willingness to pay to reduce the risk of illness or premature death. If the victims of health problems bear their full costs, rather than the government or insurance programs, the benefits of reducing exposure to environmental problems accrues entirely to the household. Therefore willingness to pay is a complete measure of benefits. 20 Setting Priorities for Environmental Management: Mining in Bolivia

Figure 1 Methodology for estimating health benefits from reducing pollution

Ambient | Exposure 1 Dose-response Health impacts (cost of mealt pcae sources of No concentrations assessment modeling (incidence of disease) vl olost oductiiy exposure value of lost productivity)

Source: Authors' calculations

Unfortunately, we have very few data on either health conditions of the people or environmental conditions in mining communities of Western Bolivia. Without more data, it will not be possible to accurately estimate the health impacts due to environmental pollution. However, based on the data currently available for these communities, and on studies done in mining communities in other countries, we can provide rough indications of the types of problems that are likely to be important, and the essential data that would be needed before undertaking an investment program. Many of these data are relatively simple to collect with well-established and low-cost techniques.

Economic infrastructure and agriculture

Environmental pollutants affect materials and buildings primarily through their presence in water. Highly acidic mine drainage corrodes piping made of iron, steel or zinc. Acidic waters may also chemically erode building materials such as concrete, limestone, and dolomite. The damages are valued as the costs of replacing materials in advance of their expected lifetimes, the added costs of utilizing acid-resistant materials (such as fiberglass pipes instead of concrete pipes), or the costs of measures to mitigate damage (such as painting or sealing building surfaces exposed to acidic waters).

Yields of agricultural crops may be significantly reduced if irrigated with acidic water or with water containing arsenic. The value of crops containing heavy metals will also be much lower than those free of such contamination, and may indeed be worthless. Estimating the benefits of reducing pollution involves calculating the reductions in both the quantity and market value of agricultural output due to exposure to pollution.2

Finally, acid waters containing high concentrations of heavy metals may damage underground aquifers which supply drinking water. The damages are valued as the costs of developing an alternative water supply, of treating water from the aquifer, or of remediating the source of pollution.

2 For the proportion of the crop consumed locally, the value of health damage due to their consumption will equal the difference in the market value of the crop, as long as there are substitute supplies. One or the other measure should be used in the calculation of benefits, not both. Identifying Priority Activities and Investments 21

In cases where the details of the damage are vague or the effects are small, it is often possible to carry out a relatively quick calculation of the potential benefits of the project by estimating the value of the site if it were returned to pristine conditions (this would be related to its potential alternative uses, such as farm-land or as a fishery). This upper bound for the site-value can then be compared to possible remediation costs.

Ecosystems

Most ecosystem damage occurs through exposure to highly acidic waters or to water contaminated with heavy metals. Few fish species or other aquatic life can survive in water with a pH of less than 4.5. (Discharged mine water in Bolivia typically has a pH of 1.2-2.5.) Heavy metals can cause disease or stunt the growth of some fish and plant species. In addition, runoff from roads or periodic releases from dams may increase turbidity in waterways, which can affect aquatic habitats and breeding grounds. Estimating the benefits of reducing ecosystem contamination requires data on both the nature and severity of ecosystem impacts and the number of hectares of land affected or kilometers of river contaminated.

Valuing ecosystem damage. Estimating the value of reducing ecosystem damage is often an imprecise task and generally involves measuring society's willingness to pay to prevent or remediate damage through nonmarket valuation techniques such as the contingent valuation method or the travel cost method. Persons who use the ecosystem for recreation or to gather food may be willing to pay to preserve their opportunity to pursue these activities. Additionally, persons who never use the resource may be willing to pay to protect it (for example, people pay considerable sums to protect the rain forest of Brazil even though they never intend to visit the region). However, studies carried out in other developing countries have shown that residents are willing to pay very little for ecosystem protection, even those they use for fishing or recreation (see Choe, Whittington, and Lauria, 1995). In Bolivia, where people have relatively few resources to meet many pressing needs, it is not likely that persons would be willing to pay much to protect ecosystems. Nor have the ecosystems of the Altiplano so far attracted the interest of donors overseas. The priority, for the time being, would therefore be to prevent the extension of ecosystem damage, with remediation limited to specific areas of particularly high sensitivity.

Attracting private investment

In addition to protecting human health, infrastructure and the environment, an important benefit to Bolivia from remediation activities on COMIBOL mining sites would be to remove impediments to private investment in COMIBOL mines, including through the Capitalization Program. For example, there could be some cases where private investors require COMIBOL to remediate contamination from past mining activities to protect themselves from exposure to risks of liability in the future. These activities may be priority activities, even if they do not provide significant direct benefits to human health, infrastructure and the environment. This is because 22 Setting Priorities for Environmental Management: Mining in Bolivia

investment would raise incomes, providing resources to improve health and environmental conditions. Specific guidelines for remediating mine sites to attract private investment are provided in the workbook.

ENVIRONMENTAL CONDITIONS IN MINING COMMUNITIES IN WESTERN BOLIVIA

There are few data available on ambient concentrations of contaminants in drinking water, surface water or air in the mining communities of Western Bolivia. This lack of information is being addressed through monitoring activities conducted as part of the environmental audits now being carried out under the on-going IDA-supported Mining Sector Rehabilitation Project. What follows is a summary of the key findings from the environmental audits currently available for Tierra, Luna, and the Javiar mine in Sol.

Drinking water contamination

Drinking water in all three mining communities for which we have data is remarkably free of contamination from heavy metals or metalloids (see Table 2). The drinking water meets North American and Pan American Health Organization (PAHO) standards for concentrations of heavy metals such as lead and cadmium-by a wide margin for most parameters. For example, in all three communities for which we have data, the concentrations of both lead and cadmium average less than 2 micrograms per liter, compared with PAHO drinking water standards of 10 micrograms per liter for each substance. However, the drinking water does contain high concentrations of fecal coliform, bacteria, and salmonella, posing a risk of infection and diarrheal diseases, particularly for children. The leading cause of sickness and death among children below the age of five in Bolivian mining communities are diarrheal diseases caused by drinking water contaminated with bacteria, fecal coliforms, and viruses. In all three communities, it appears that pipes carrying drinking water have become corroded due to exposure to acid rock drainage, allowing sewage to contaminate drinking water supplies.

Surface water contamination

In contrast to drinking water, water in streams ancl rivers downstream of mines is often contaminated due to mining activities. Some of these streams and rivers have low pH values, contain high concentrations of heavy metals (especially zinc, cadmium, and copper), and carry heavy sediment loads. Surface water bodies may be contaminated for a distance of 3-20 kilometers downstream from the sources. In Tierra, Luna, and Sol, the sources of acid rock drainage are very numerous, discharging from mine adits constructed over the long histories of the mines (ranging from 400 years for Javiar in Sol to 150 years for Tierra), old waste rock piles, new waste from cooperative mining activities, and coarse and fine tailings from old and new milling operations. Many rivers also contain naturally high levels of arsenic, copper, and lead due to the geochemistry of the underlying bedrock. In some cases, these high background Identifying Priority Activities and Investments 23 concentrations exceed intemational standards for human consumption and irrigation. Three rivers with high background metal concentrations are the Desaguadero, Sevaruyo, and Marques. In addition, surface water bodies in mining towns are typically heavily contaminated with sewage. In the mining towns of Tierra, Luna, Nube, and parts of Sol for example, sewage water flows in open channels through the center of town to the downstream area of cooperative mining. In some of these towns, the informal miners use this contaminated water to treat the ore: that is, men, women, and children work directly in sewage water. Although the presence of acidic water with the sewage water to some extent controls the spread of diseases, direct exposure to sewage water is certainly a major health risk for the workers.

Table 2 Drinking water quality in selected mining communities compared with Pan American Health Organization and United States standards

Standards

Tierra Luna Sol PAHOa United Statesb

(micrograms per cubic meter)

Lead .05-2.1 .14-.9 .5-2 10 I5c Cadmium .01-1.4 .01-.09 .04-.07 10 5 Arsenic .73-6.7 .5-19 13-48 50 50

Zinc .2-97 1-106 106-154 15,000 5 ,0 00d pH 6.7-8.3 6.0-8.1 n.a. n.a. 6.5-8.5d

Microorganismcolonies per n.a. 0-10,000 n.a. 0 n.a. milliliter Coliform bacteria per 100 18-90 0-43 .1-1380 10 (e) milliliters n.a. Data not available. a/ PAHO standards are maximum acceptable concentrations. b/ Unless otherwise noted, United States standards are maximum permissible levels in public water systems. c/ Action level. d/ Secondary maximum permissible levels in public water systems. Secondary standards are recommendations only, and are not based on health impacts, but rather on issues of taste or appearance. e/ No more than 5 percent of samples per month may be positive. For systems collecting fewer than 40 samples per month, no more than one sample per month may be positive. Source: Analyses are by MeAna Konsult Laboratories, Sweden. 24 SettingPrioritiesfor EnvironmentalManagement: Mining in Bolivia

Air pollution

Dust is a problem in many mining towns, from traffic, emissions from crushing plants, and wind blowing across the dry Altiplano. Data from Tierra show that the dust contains silica (Si02 ) in small particle sizes (2-5 microns). Exposure to silica dust in high concentrations, such as are found within mines, can cause silicosis. Dust in mining towns may also contain heavy metals in high concentrations, especially zinc, but also lead, cadmium and arsenic. Among the greatest contributors to ambient dust are vehicles traveling along unpaved roads. Roads in mining towns have typically been built with mine tailings and waste rock, and analyses show that road dust contains very high levels of lead, arsenic, and cadmium - often higher than cultivated soils (see Table 3).

Still, the impact on health due to exposure to ambient dust of the type found in mining towns is not certain. For the most part, the large particles typical of road and wind-blown dust are too large to enter deeply into the respiratory system, where they cause the most damage.3 Unfortunately, there are no data at present regarding either ambient air pollution, or health conditions to provide an indication of the extent to which airborne dust is affecting health.

In some communities indoor air pollution may threaten health. Indoor air pollution is more likely to be a problem in smaller, rural mining communities, where biomass is used for heating and cooking, than in the larger towns, such as Sol or Potosi, where natural gas or electricity are widely available.

Table 3 Heavy metals in soils in Tierra and Luna compared with critical and background levels (micrograms per gram dry weight)

Tierra Luna

Cultivated soil Road dust Cultivated soil Critical levelsa Background levelsb

Lead 13-970 240 1.2-2.0 1,000 11-30 Cadmium .3-54 66 1.8-27.3 n.a. 0.12-0.15 Arsenic 70-1000 130 1.4-25.6 500 17-24 a/ Criticallevels are levels consideredpotentially dangerous to human health. The figures are from WorldHealth OrganizationRegional Office for Europe 1987;Hutchinson and K. Meema 1987. b/ Backgroundlevels are for this region. n.a. Data not available. Source: Analysesare by MeAna KonsultLaboratories, Sweden.

3 Particlesbelow 10 microns in diameter(PM, 1 ) and especiallybelow 2.5 micronspose the greatestthreat to health, since they can be breathed deeply into the lungs. This fine particulate pollution comes mainly from combustionsources, rather than from wind or traffic. Identifying Priority Activities and Investments 25

Soil and crop contamination

Soil contamination. As would be expected, concentrations of metals in agricultural soils vary greatly depending on the location of the fields relative to the mine. Some soils sampled in Tierra contained concentrations of lead as high as 970 micrograms per gram, compared with a background level of 16 micrograms per gram. Soils in Tierra and in Luna also contained levels of arsenic considered by scientists to be unsafe for food cultivation. In both communities, the affected soils lay adjacent to tailings or waste rock piles or next to busy roads, and do not indicate wide-spread contamination of the area.

Contaminated soil may pose a threat to health not only through food, but also through direct contact. Children playing on dirt with high concentrations of lead, arsenic, cadmium, or zinc may ingest large doses of these metals by putting hands covered with dust in their mouths.

Crop contamination. Analyses of the tissues of plants grown in Luna show that some types of crops are much more affected by metal contamination than others. Of the crops tested, quinua is the one most affected by metal contamination. Quinua grown on a site near a busy road contained high levels of lead, but barley from the same field contained only trace amounts. Quinua grown downwind of a sandy tailings pile contained higher levels of cadmium and arsenic than potatoes or barley grown on the same field. Interestingly, metal concentrations in quinua were not related to soil concentrations. Rather contamination appears to have come from the deposition of airborne particles, with vehicle exhaust the source of lead, and windbome dust the source of cadmium and arsenic.

Table 4 Heavy metals in crops in Luna compared with critical and background levels (micrograms per gram dry weight)

Quinua Potatoes Barley Critcal levelsa Background levels

Lead 0.8-2.7 0.02-0.03 0.05-0.5 n.a. n.a. Cadmium 0.08-0.9 0.02-0.4 0.04-0.3 0.1 n.a. Arsenic 0.6-8.9 <0.05 n.a. 10.0 1.0 n.a. Data not available. a/ Critical levels are levels considered potentially dangerous to human health. The figures are from World Health Organization Regional Office for Europe 1987; Hutchinson and Meema 1987. b/ Poposed WHO/FAO limit value. Source: Ministerio de Desarrollo Sostenible y Medio Ambiente, Secretaria Nacional de Mineria, Swedish Geological AB 1995. Laboratory analyses are by MeAna Konsult Laboratories, Sweden. 26 Setting Priorities for Environmental Management: Mining in Bolivia

The crop second most affected by metal contamination is potatoes. By contrast to quinua, levels of cadmium in potatoes are closely correlated with soil concentrations. Table 4 shows concentrations of lead, cadmium, and arsenic found in crops grown in Luna.

Physical hazards due to past mining operations

Old mining operations often leave behind considerable physical hazards which threaten the health and safety of human beings and animals. These differ by site, but include hazards such as the collapse of old tailings dams or piles, erosion or landslides, and land subsidence. In addition, unsecured mine entryways, abandoned buildings and machinery, and discarded explosives and equipment may lead to injury or death.

CHOOSING PRIORITY INVESTMENTS AND ACTIVITIES

In general, the priority problems are those causing significant damage to human health, economic infrastructure or ecosystems, and for which cost-effective control is possible. In Bolivian mining towns the most serious problems are likely to be microbiological contamination of drinking water, lead in various media, airborne dust, and cadmium and arsenic in the environment. If there are available reasonable cost investments which reduce the incidence of water-borne diseases, cases of elevated blood-lead, and morbidity and mortality associated with exposure to airborne dust or heavy metals, these are likely to provide significant benefits to human health and the economy.

For each problem, a variety of interventions are available to reduce the impacts of the pollution. The interventions may include remediating the source, intercepting the pathway, or controlling the exposure. For example, to protect against disease from contaminated drinking water caused by corrosion of piping, options include purchasing bottled water, boiling water, chemically treating water, and using acid-resistant piping for the water distribution system, in addition to remediating the source of pollution. The best interventions are those which alleviate the impacts of pollution both effectively and at low-cost.

4 The most effective and lowest-cost approach to protect health from mining pollution is to prevent the generation of acid rock drainage and other sources of mining pollution before they have begun. However, where there are already many sources of mining pollution, it may be more cost-effective to intercept the pathway or control exposure than to remediate all sources of pollution. Identifying Priority Activities and Investments 27 will not make their water usable for drinking. To reduce exposure to airborne dust, it may be both more effective and lower-cost to seal or pave urban roads than to cover or move tailings piles. Paving the roads would provide, in addition to health benefits, the benefits of lower transportation costs, reduced cleaning costs and the amenity values associated with having cleaner air.

In most Bolivian mining towns, the primary reason to remediate past contamination from mining would be to protect ecosystems rather than to protect human health. However, restoring aquatic ecosystems is often very difficult to achieve; it may be necessary to completely (or nearly so) remediate a very large percentage of all the sources of contamination - including nonmining sources - before the streams or rivers could support breeding populations of fish. Achieving this goal would require the remediation, control, and management of all sources of pollution within a watershed (of course measures to protect human health would also contribute to protecting aquatic habitats). While there are many long-term benefits to restoring ecosystems, these benefits may take decades to realize, and are extremely costly to implement.

It should be noted that, many of the old tailings and waste rock piles contain relatively high concentrations of metals, which could be re-mined profitably with the new heap leaching and batch leaching technologies.5 It would make little sense to cover or move such wastes until it is determined whether they have economic value. Furthermore, remining can contribute to environmental cleanup, since the material must be moved for re-processing, which can be carried out with modem environmental controls. Indeed, in some circumstances, it may make sense to re-mine old tailings or waste rock even if this would not be profitable, if the economic benefits of remediation were sufficiently high. Specific guidelines are provided in the workbook.

SITE-SPECIFIC PROPOSALS

Priorities for environmental improvement will depend on the characteristics of specific sites and on the needs and values of the local residents. The COMIBOL mining communities vary considerably in terms of their populations, likelihood of attracting private investment, location, existing infrastructure, size and importance of informal mining cooperatives, environmental conditions, and future viability. The proposals below represent our current judgment as to what investments will provide the greatest benefits for the resources used, based on preliminary

5 The heap or batch leachingtechnologies have existedfor only about a decade. They have made it possible to extract metals from ores previouslyconsidered worthless. New heap leachingand batch leachingfacilities are alreadyoperating in Potosi and in Sol. 28 Setting Priorities for Environmental Management: Mining in Bolivia infonnation. Most of the proposed investments would provide quick paybacks (3-5 years), so would be appropriate for mining communities whose long-term futures are uncertain. Final decisions should be made after discussions with communities and the collection of more data. Recommendations for further investigation: Sol

With a population of about 100,000, Sol is the largest COMIBOL mining community. Before being closed in July 1992, its Javiar mine had been operating for over 400 years, first as a silver mine, and later as a tin-silver-zinc mine. Over its long history, the mine operated with limited environmental controls, and with little concern to separate residential and commercial areas from mine waste or acid rock discharges. Indeed, houses, churches, stores, markets, and workshops have been built directly on top of old tailings and waste rock piles. Local residents are likely exposed daily to lead in the air and in food and through direct contact with contaminated soil. In addition, acid rock drainage has likely contributed to the corrosion of infrastructure of Sol. Low- pH water hastens the corrosion of pipes made of zinc, concrete, iron, or copper-which can permit sewage to contaminate drinking water supplies. Acid water also has the capacity to weaken building foundations constructed of carbonate material.

While the mine had been the major source of employment for Sol, the city is developing alternative sources of employment in manufacturing, food and beverage processing, metal smelting, and brick making. In addition, Sol is the commercial center and transportation hub for the Altiplano, being located on major transportation routes between La Paz, Sucre, Potosi, and Chile.

Sol would be an ideal location for a pilot project to improve environmental conditions in mining communities in Western Bolivia. There are four reasons why. First, past mining activities in Sol pose significant risks to human health and the environment, both because of the numbers of persons affected, and because of the nature of mining-related pollution at this site. Second, the city has a viable future, so inhabitants will benefit far into the future from investments made now. Third, the mine is unlikely to attract private investment. Therefore there is little expectation that private investors could undertake activities for environmental improvement. Fourth, there is more information available about environmental conditions and human health impacts than for any other mine site in Bolivia. Sol has been the site of the Sol Pilot Project, an intensive research project6 begun in 1993 to obtain data on the impacts of mining pollution on the ambient air, groundwater, surface water, ecosystems, infrastructure, and human health. This information can form a sound basis for deciding on investments in environmental improvement.

The top priority environmental investments for Sol are likely to be:

6 The Sol Pilot Project is being financed by the Swedish government and IDA under the Mining Sector RehabilitationProject. Identifying Priority Activities and Investments 29

Repairing or replacing pipes delivering drinking water to the town. These pipes have become corroded-probably at least partly through exposure to acid waters draining from the mine and surrounding tailings and rock piles-and sewage now contaminates the drinking water supplies. Repairing the pipes would increase both the quality and the quantity of drinking water, both of which would provide health benefits. Better quality water would provide direct benefits through a reduction in exposure to contaminants, while greater quantities of water would provide water for washing hands, dishes, utensils, foods, household goods, and personal hygiene to remove the residue of contaminated dust and dirt. Repairing the pipes would also reduce costs of pumping, treating, and distributing water as a result of lower water losses.

It is estimated that the project would reduce the incidence of diarrheal diseases among children by 25-50 percent. This would be valued at (a) the cost of medical care for each incidence delivered at the local health clinic (the cost of medicine plus the cost of medical services), and (b) the cost of mother's time to care for the sick child. The benefits associated with reduced water losses would be the costs of electricity and chemicals saved.

2. Sealing playgrounds and other play areas that have been built on mine waste material (or alternatively removing and replacing the dirt, for example dirt surrounding houses). This would prevent children from being exposed directly to the lead, arsenic, cadmium, and zinc contained in this material. The project would reduce the number of cases of lead poisoning, and of diseases associated with exposure to other toxins. For lead, the benefits would be valued as (a) the cost of medical care, (b) the cost of mother's time to care for the sick child, and (c) the value of reduced life-time earnings resulting from reduced IQ.

3. Controlling the dust from the roads within the town which have been constructed with mine waste. Traffic along these roads is the primary source of metal-laden airborne dust. The project would reduce the number of respiratory diseases and other diseases caused by exposure to airborne lead and arsenic. These health benefits would be valued as (a) the cost of medical care, (b) the value of time lost from work, (c) the willingness to pay to reduce discomfort from the diseases, and (d) the value of premature mortality. Paving town roads would also provide benefits by reducing transportation costs and the costs of cleaning, and by generating amenity values.

4. Remediating physical threats left by old mine operations. This would entail stabilizing slopes, sealing old shafts and adits, removing abandoned explosives and equipment, etc. The project would reduce the risk of accidental injury and death. The benefits would be valued as the willingness to pay to reduce this risk, often expressed as the value of a statistical life. 30 Setting Priorities for Environmental Management. Mining in Bolivia

5. Providing education and technical assistance to improve decisionmaking for environmental management. For example, a mechanism is needed for regulating new mining operations at Sol to limit future environmental damage. This mechanism should include procedures for permitting, inspection, enforcement and comprehensive reclamation for new mining operations.

Technical assistance is also needed to develop an environmental monitoring program which would collect data on ambient environmental conditions and on human health impacts. For example, it would be very useful to have information regarding blood lead levels of the inhabitants, so that decisionmakers know whether or not lead exposure is in fact damaging health in Sol.

Finally, technical assistance is needed to model the hydrology of the Sol watershed to determine if contamination of the shallow aquifers is threatening the deep-water aquifers which may in the future be a source of drinking water for the municipality.

6. Channeling and treating acid rock drainage. The mine drainage is an important source of very acid waters which are believed responsible for hastening corrosion of pipes and building materials in the urban area. In addition, the mine drainage is believed to be a significant source of contamination of Lake Crist6bal and of the shallow aquifers in the Sol environs. The project would lengthen the lifetime of the underground pipes, reduce building repair costs, and reduce the flow of contamination to both Lake Crist6bal and the region's aquifers. These would be valued based on (a) the incremental increase in the projected lifetime of a new water and sewerage system, (b) the reduction in building repair costs, (c) the willingness to pay to reduce the risk that contamination will reach the deep aquifers, and (c) the willingness to pay to restore the fisheries at Lake Crist6bal and improve the lake's amenity value.

7. Moving the Domingo dump, reshaping the old site, and constructing ditches to collect acid rock drainage. The Domingo waste rock dump is a major source of acid rock drainage which damages urban infrastructure and contaminates the region's shallow aquifers. In addition, located in the center of the city, the Domingo dump has been used as a building site for houses, churches, commercial and manufacturing enterprises and other urban dwellings (the surface of the dump is clearly exposed in some unpaved streets and backyards). Inhabitants of the city come into direct contact with lead, arsenic, cadmium, zinc, and copper contained in the material. The project would reduce human health damage due to exposure to heavy metals in the soil. In addition, the project would lengthen the lifetime of the underground pipes and building foundations, and reduce the flow of contamination to both Lake Crist6bal and the region's aquifers. Finally, the project would make available uncontaminated land for urban development in the center city. These would be valued as (a) the benefits of reduced health damage from lead and other heavy metals in air and soil; (b) the benefits of reducing damage to infrastructure, Identifying Priority Activities and Investments 31

aquifers, and ecosystems (see point 6, above); and (c) the increase in the quantity and quality of land available for building sites in the city.

Alternatively, it may be possible to cover the Domingo dump in situ. This solution would produce the same benefits as moving the dump, with the exception of improving the value of the property.

Before pursuing this activity it will be necessary to assess the economic feasibility of remining the material for silver. The new operator would then carry out environmental remediation in conjunction with the remining activity.

Recommendations for further investigation: Luna

Luna is a relatively isolated mining community, situated in the mountainous terrain of the Eastern Cordillera, 50 kilometers southeast of Sol. With an annual precipitation of around 500 millimeters per year, vegetation in the area is scarce, and there are almost no trees. The Luna river drains the area, joined by many small streams which flow only during the rainy season, November to March. There are no nature reserves in the vicinity of Luna, nor, so far as we know, any endangered species.

Luna has a population of around 12,000, nearly all of whom are dependent directly or indirectly on mining for a living. COMIBOL employs about 350 people, down from a workforce of over 1,000 in 1992. About 1,200 inhabitants, including former COMIBOL workers, are organized into cooperatives, and earn small incomes extracting metal from waste rock and tailings discharged from the mill.

Neither the climate nor the fertility of the soil are conducive to farming, so very little agriculture takes place in the region. Most food is trucked in from Sol or Cielo. A few families maintain farm plots to raise crops for home consumption. Some families also maintain small herds of llamas and sheep.

The prospects for Luna are very different than for Sol. The mine in Luna is very rich and has the potential to be highly profitable if operated with modern equipment and management practices. It is thus very likely to attract new investors who will be able to undertake some responsibility for remediating old mining waste and for improving environmental conditions in the community. New investors may also demand that COMIBOL remediate the site in order to reduce their exposure to liability in the future. COMIBOL therefore will want to delay investing all but small sums for cosmetic improvements in Luna, until it becomes clearer what private investors can and want to do.

Based on infornation contained in the environmental audit, the top priority environmental investments for Luna are likely to be the following. Note that the first five recommendations are 32 Setting Priorities for Environmental Management: Mining in Bolivia similar to those made for Sol and are presented here in an abbreviated form. For more information on how to value the benefits see recommendations for Sol, above.

1. Repairing or replacing pipes delivering drinking water to the town.

2. Sealing playgrounds and other play areas that have been built on mine waste material (or alternatively, removing and replacing dirt, for example surrounding houses).

3. Controlling the dust from the roads within the town which have been constructed with mine waste.

4. Remediating physical threats left by old mine operations.

5. Providing education and technical assistance to improve decisionmakingfor environmental management.

6. Activities to remove impediments to private investment. In some cases, private partners may require COMIBOL to remediate contamination from past mining activities as a condition of their investment in order to reduce their exposure to risks of liability in the future. For example, private investors might require that COMIBOL remove or treat sources of contamination upstream the mine operations, to prevent the possibility of later being held responsible for contamination that occurs downstream the mine. The benefits would valued as the incremental increase in the value of the mine property at Luna.

7. Constructing a sewage collection system. In Luna, sewage waters run freely through open channels through town to an area of cooperative mining. Men, women, and children come into direct contact with this contaminated water, standing in the river and processing their ores. This is posing a health risk to the workers by exposing them to bacteria, fecal coliform, and other disease-causing agents. The benefits of the project would be the reduced incidence of waterborne diseases, and the amenity values associated with living in a cleaner environment. These would be valued as (a) the cost of medical care, (b) the cost of days lost from work, (c) the willingness to pay for a cleaner environment.

8. Ventilating the mine. The ambient air in the underground mine at Luna is heavily contaminated with radon, which causes lung cancer, and with silica dust, which causes silicosis.7 Ventilating the mine would significantly reduce the incidence of both these diseases. The benefits would be valued at (a) the cost of medical care; (b) the cost of days lost from work; and, in the event of a fatality, (c) the value of premature death.

7 Available data from studies carried out by INSO and others indicate that silicosis is the major health problem among miners of the hard-rock mines of Bolivia. The recent environmental audit carried out for Luna did not investigate the level of silica dust in the air. Identifying Priority Activities and Investments 33

Recommendations for further investigation: Tierra

Tierra is a relatively small, isolated mining community, in mountainous terrain, 75 kilometers northeast of Sol. Vegetation in the area is scarce and there are almost no trees. Nearly all Tierra's population of 21,000 is dependent on mining for a living, and work either as miners or in activities which support the industry. COMIBOL's mining and milling operations employ about 350 people, down from a workforce of 700 in 1994. An additional 700 miners work the upper levels of the mine as artisanal miners organized into cooperatives under agreement with COMIBOL. A few families cultivate fields or maintain herds of sheep and llamas to supplement their incomes from mining. Only a few families live downstream from the mine, since the steep mountain slopes are largely unsuitable for farming.

Like Luna, the Tierra mine contains a rich tin deposit, and is likely to attract new private investment. COMIBOL should delay expending resources for remediation until it becomes clear what arrangement can be made with a new operator.

The top priority environmental investments for Tierra are likely to be the following. Note that the first six recommendations are similar to those made for Sol and are presented here in an abbreviated form. For more information on how to value the benefits see recommendations for Sol, above.

1. Activities to remove impediments to private investment.

2. Repairing or replacing pipes delivering drinking water to the town.

3. Sealing playgrounds and other play areas that have been built on mine waste material (or alternatively, removing and replacing dirt, for example surrounding houses).

4. Controlling the dust from the roads within the town which have been constructed with mine waste.

5. Remediating physical threats left by old mine operations.

6. Providing education and technical assistance to improve decisionmaking for environmental.

7. Constructing a sewage collection system. In Tierra, sewage waters run freely through open channels through town to an area of cooperative mining. Men, women, and children come into direct contact with this contaminated water, standing in the river and processing their ores. This is posing a health risk to the workers by exposing them to bacteria, fecal coliform, and other disease-causing agents. 34 Setting Priorities for Environmental Management: Mining in Bolivia

8. Stabilizing the San Marco tailings dam. The San Marco tailings dam is unstable and in danger of collapse which could result in significant human injuries and deaths and destruction of infrastructure. The project would reduce the risk of this destruction. The benefits would be valued as the willingness to pay to reduce this risk.

9. Identifying the sources and pathways for mercury contamination. If the studies find mercury contamination to be a significant threat to human health or the environment, then a priority would be addressing it by teaching and training, providing alternative technologies, or developing an institutional solution, such as fencing the affected area or prohibiting the remining of old mine tailings. This would reduce the incidence of mercury poisoning. The benefits would be valued at (a) the cost of medical care; (b) the cost of days lost from work; and, in the event of a fatality, (c) the value of premature death.

The above recommendations and the jurisdictions for their implementation are summarized in Annex 6.

CAVEATS

Even under the best of circumstances, remediating mine sites is a complex and challenging task. The mining history, topography, climate, hydrology, and geochemistry of each site are unique. Water is the primary pathway for the transport of mining-related pollution; limited information about the hydrologic regime at these sites makes it difficult to predict with certainty the magnitude of the risk facing human populations, the extent of the degradation, or the efficacy of the proposed remedies. Additionally, at each of these sites, there are multiple sources of contamination, both man-made and naturally occurring, which are causing environmental degradation. Thus improvements in water quality, and subsequently human health, may not be realized with the remediation of a single source.

Site-specific mineralogy and processing techniques affect both the toxicity and the bioavailability of contamination due to mining. Detailed site characterization, coupled with epidemiological studies, are necessary to accurately identify the risks to human health in these communities, and consequently, the remedies which will achieve the greatest benefits. The baseline data are also essential to measuring the performance of selected remedies. Flexibility in choice of remedy, and incremental implementation of remedies will increase the likelihood of success while reducing the risk of wasting resources. Annexes

Annexes 1-5 provide the worksheets for selecting priority sites, chapter 2. Annex 6 summarizes the site specific recommendations developed in chapter 3 on selecting priority investments and activities. The workbook following the annexes provides details on how to calculate benefits of specific investment options. Sources for all tables, unless otherwise noted, are authors' calculations.

Annex 1

Hazard Ranking System with Example

Annex 1 presents a spreadsheet for assigning hazard scores to individual mines and, as ani example, a spreadsheet completed for Tierra mine based on data presented in its environmental audit. The Annex contains four sections. Annex lA consists of the mine hazard scoring spreadsheet; Annex 1B consists of five tables for computing the numeric representing the overall severity and extent of problems at the site (column 2 of the spreadsheet). Annex 1C contains the tables for calculating numerics for the numbers or sensitivity of the recipients of exposure (columns 3, 5, and 7). Annex ID contains an example of the methodology applied to Tierra mine.

How to use the spreadsheet

Damage to human health and plant and animal life depends on exposure to metals or chemicals or to physical hazards. In column 1 of the spreadsheet, the analyst notes whether the hazard is likely to exist. If the substance is very likely to exist, the analyst assigns a score of 2, if it is likely to exist only in small quantities, he gives a score of 1, and if it is unlikely to exist, he gives a score of 0. Minerals which were mined at the site should in general receive scores of 2 (very likely to exist). Minerals or chemicals that are found in association with the primary metals but which are not themselves the target of mining activities, receive scores of 1 (likely to exist in small quantities). In Bolivia, arsenic and cadmium are common by-products of mining activities, so in almost all cases receive scores of 1.

If the substance is likely to exist, the analyst needs to know in what quantities, since damage depends on dose or concentration of exposure. The concentrations of metals or chemicals likely to cause damage varies, depending on the substance. For some substances, damnagewill not occur until after exposure to a minimum quantity for a minimum duration or a threshold dose. For other substances, for example carcinogens, no safe threshold level exists, and impacts are approximately linear with exposure. Together, columns 2 (severity and extent of the problem), and columns 4, 6, and 8 (hazard rankings of the chemicals and metals), provide an indication of whether the substance is likely to be damaging health, economic infrastructure, or environment.

For column 2, the analyst estimates the seriousness of environmental contamination using the numerics provided in Tables AIB.I-AlB.5 for each of five key mine characteristics. The sum

37 38 Setting Priorities for Environmental Management: Mining in Bolivia

obtained by totaling the scores for each of the mine characteristics is the number to be entered into each row in column 2. The maximum number for column 2 is 10. The characteristics most important for estimating both chemical and physical hazards are (1) type of commodity, (2) current status, (3) years of operation, (4) size of production, and (5) mill type. Mines which are currently operating will likely have higher ambient concentrations of metals and chemicals than mines which closed 20 years ago; mines which have operated over many years will likely be more contaminated than mines that are new, large mines will have more contamination than small mines, mills using flotation methods will likely generate worse contamination than mills using gravitation methods. Totaling the individual scores for each of these categories will provide a score for the overall extent and severity of environmental contamination from the mine site. This value is meant to provide a means of ranking mines relative to one another in terms of potential contamination, rather than to identify the contaminants likely to be causing the most damage.

Finally, columns 3, 5, and 7 (number of persons exposed, extent of damage to materials, buildings, etc., and sensitivity of exposed ecosystems) provide an indication of the quantity of the damage. Lead contamination is more serious in populated areas than in uninhabited regions, for example. Annex 1, Tables AlC.1-AlC.3 contains numerics for population sizes, value of damage to economic infrastructure, and sensitivity of ecosystems. There is one table associated with each of columns 3, 5, and 7. The number obtained using the tables is entered into each row of the colunmn.

Calculating hazard values

Each row in the table - representing each of the separate chemical or metal hazards - receives a score based on the potential of that substance to be damaging health, physical structures or ecosystems. The value for each hazard is computed as follows:

(column 1 x column 2) x [(column 3 x column 4) + (column 5 x columnn 6) + (column 7 x column 8)] = column 9.

The individual row scores provide an indication of how potentially damaging a particular hazard is likely to be relative to other hazards at the site, thereby providing guidance on priorities for the risks to be addressed. The site total, computed as the sum of the row scores, provides a measure of the overall hazard potential of the mine relative to other mines. Sites with the highest scores potentially pose the greatest threat to human health, economic infrastructure and the environment. These are the priority sites for further investigation. Annex 1A.1 Mine hazard scoring worksheet

Mine name

1 2 3 4 5 6 7 8 9 Likely to Severity Number of Health Extent of Materials Sensitivity Environ- Row exist?a and extent persons hazard damage to hazard of exposed mental score ofproblem exposed ranking materials, ranking ecosystems hazard l ~~~~~~~~buildings, ranking Hazard et Chemicalor metal hazards Lead 9 3 Mercury 9 4 Arsenic 8 2 Cadmium 7 3 Zinc 2 2 Silver 2 2 Acid generation 0 3 Cyanide 2 3 Physical hazards 9 SITE TOTAL a/ Very likely = 2; possible in small quantities 1; Not likely =0. 40 SettingPriorities for EnvironmentalManagement: Mining in Bolivia

Annex 1B Key mining characteristics for estimating extent and severity of contamination

TableAlB.1 Type of commodityproduced Table AIB.2 Current status Value Value Lead 2.0 Currently operating 2.0 Zinc 1.0 Closed within last 10 years 1.7 Silver 1.0 Closed 20 to 30 years ago 1.3 Tin 0.4 Closed 30 to 40 years ago 1.0 Closed 40 to 50 years ago 0.7 Closed more than 50 years ago 0.3 Table A1B.3 Number of years operating Value Over 100 years 2.0 TableA1B.4 Size of production Between 60 and 100 years 1.6 Total metric tons Value Between 40 and 60 years 1.2 Between 20 and 40 years 0.8 Large: > 1 million 2.0 Between I and 20 years 0.4 Medium to large: 500,000-1 million 1.7 Medium: 250,000-500,000 1.3 Small to medium: 10,000-250,000 1.0 Table A1B.5 Mill type Small: 1,000-10,000 0.7 Value Very small: < 10,000 0.3 Amalgamation 2.0 Arrastre 1.2 CIP 2.0 Crusher (only) 0.4 Cyanidation 2.0 Flotation 2.0 Gravity 1.2 Heap leach 2.0 Jig plant 1.2 Leach 2.0 Retort 2.0 Stamp 1.2 Unknown/possible 1.0 No mill 0.4 Hazard Ranking System with Example 41

Annex 1C Population, infrastructure, and ecosystems exposed

Table A1C.1 Exposedpopulation Value < 10,000 1 10,000-20,000 2 20,000-30,000 3 30,000-40,000 4 40,000-50,000 5 50,000-60,000 6 60,000-70,000 7 70,000-80,000 8 > 90,000 9

TableA1C.2 Exposedbuildings and materials Value Mine isolatedfrom buildingsand materials 1 Some buildingsand materials exposed 5 Extensiveurban infrastructure- As Sol 9

Table A1C.3 Sensitivityof exposedecosystems Value Mine isolatedfrom major water bodies 1 Mine contaminantsdrain into streams or river 5 Mine drainageaffects sensitiveecosystems - as Lake Poop6 9 Note: Valuesfor infrastructureand ecosystemexposure (Tables AIC.2-AIC.3) may be between0 and 9. The values in the tables are meant to representextreme points on the continuum.

41 42 Setting Priorities for Environmental Management: Mining in Bolivia

Annex IC Example: Tierra mine

The Tierra mine has produced three minerals since it was first exploited in the mid-i 800s: silver followed by tin and zinc. The mine is still operating, currently producing tin and zinc. Over the mine's long history, workers have extracted over 1 million metric tons of ore. A mill on the property currently produces concentrates of both zinc and tin using flotation methods.

Column 1: Is the hazard likely to exist?

The analyst begins by completing column 1, using judgment regarding whether or not a particular hazard is likely to exist on the site. Because the mine has been in operation almost 150 years, and because it has produced silver, lead and zinc, nearly all hazards are likely to exist on the site except cyanide and mercury. Cadmium and arsenic receive scores of 1, since they exist in conjunction with the primary minerals at the site.

Column 2: Calculating the extent and severity of contamination

The five tables presented in Annex lB are used to calculate the value for extent and severity of the contamination. The following table summarizes the values obtained from each of the five tables.

Value

Table AIB.1: Commodity Tin 0.4 Zinc 1.0 Table A1B.2: Current status Operating 2.0

Table A1B.3: Years of operation Over 100 years 2.0

Table AlB.4: Size of production Over 1 million metric tons 2.0

Table A1B.5: Mill type Flotation 2.0

TOTAL 9.0

For categories with more than one potential value, the higher value prevails. In this example, the value for zinc prevails, since zinc has a higher value than tin. The number 9 is entered into each row of column 2. Hazard Ranking System with Example 43

Column 3: Calculating values for number ofpeople exposed

According to the Tierra mine environmental audit, about 21,000 people live in the catchment area of the mine, and are potentially exposed to contamination generated from mining acti-vities. Annex 1C, Table A3.1 contains a table providing numerics for different population sizes. A population of 21,000, as in the case of Tierra, receives a value of 3. This number is entered into each row of column 3.

Column 6: Calculating the extent and severity of damage to buildings, materials, and the like

Annex IC, Table AlC.2 contains values for damage to buildings, infrastructure or materials. Since the Tierra mine drainage does not extensively affect buildings or materials, and receives a score of 2 for this category, to be entered into each row of column 6.

Column 8: Sensitivity of exposed ecosystems

Annex 1C, Table A1C.3 contains values for sensitivity of exposed ecosystems. While the drainage from the Tierra mine does enter nearby surface water sources, it does not affect particularly sensitive ecosystems. The mine receives a score of 3 for this category.

Applying the hazard value formula described in the previous section, the score for lead at Tierra is: (2 x 9) x [(3 x 9) + (0 x 2) + (3 x 3)] = 648. This is the highest score for any row on the spreadsheet, suggesting that lead is potentially the most serious environmental hazard at Tierra. Performing similar calculations for all rows, produces a total hazard score for Tierra mine of 2,340. This is rounded off to 23 for comparison with other sites.

43 Table A1D.1 Mine hazard scoring worksheet: Example

Mine name Tierra 1 2 3 4 5 6 7 8 9 Likely to Severity Numberof Health Extent of Materials Sensitivity Environ- Row exist?a and extent persons hazard damage to hazard of exposed mental score of problem exposed ranking materials, ranking ecosystems hazard buildings,|lranking Hazard elc Chemicalor metal hazards Lead 2 9 3 9 3 648 Mercury 0 9 3 9 2 3 4 0 Arsenic I 9 3 8 2 3 2 270 Cadmium I 9 3 7 2 3 3 270 Zinc 2 9 3 2 2 216 Silver 2 9 3 2 2 216 Acid generation 2 9 3 0 2 3 3 234 Cyanide 0 9 3 2 23 3 0 Physical hazards 2 9 3 9 2 3 486

SITE TOTAL 2,340 a, Very likely = 2; possible in small quantities = 1; Not likely =0. Annex 2

Rapid Site Assessment

Objective

The objective of the Rapid Environmental Assessment is to collect readily available information which can be used to (1) confirm the initial identification of the site as having potentially significant impacts; and (2) define the data needed to estimate the damage to health, ecosystems and economic infrastructure caused by contamination and physical hazards at the site. The following sections list the key points to be addressed in carrying out the assessment.

Define the scope

Define the boundaries of the site. For a mine this is the area that is under the effective control of the enterprise and may be defined by legal boundaries or by practical considerations. A map should be provided showing the boundaries adopted for the purposes of the Assessment. Details of ownership and current level of operations should also be provided.

Identify the surrounding areas. Identify on the map and provide description of the areas that have probably been affected by contamination from the site. This is clearly a question of judgment but where there is limited data, the scope considered should be around ten kilometers.

Describe the site

The site under consideration (usually a mine) should be described under the following broad headings. (These headings are provided as guidance - where appropriate they should be adjusted to reflect the reality on the site.)

Physicalfeatures and infrastructure

* Entrances and adits * Concentrators and other processing facilities * Tailings dams * Waste heaps (desmontes and colas)

45 46 Setting Priorities for Environmental Management: Mining in Bolivia

* Offices and stores * Railways and conveyors * Roads * Water supply (and sanitation) systems * Pumping stations and other plants

Human activities (specify whether the activity is supported by the mine, the cooperatives, or other)

. Housing * Schools * Shops and other facilities * Clinics * Areas of extraction and/or processing * Pumps or other plant * Agriculture * Livestock

Sources of pollution (both related to ongoing operations and those that would continiue even if the mine stopped operations). Note those parts of the site which have been identified as actral or possible sources of pollution - outlets from drainage systems, concentrator discharges, major underflow from tailings heaps, and the like.

Releases from the site. Identify major points of release from the site (rivers, etc.) and obtain copies of whatever data is available on air or water releases from the site.

Describe the surrounding area

The size of the area affected will vary according to site specific characteristics such as the nature of the water basin, the composition of the host rock, and the prevailing wind patterns. In general, the areas affected by airborne particles and gases would be ten kilometers downwind, and the area affected by waterborne contaminants, ten kilometers downstream. To estimate damage caused by mining activities, analysts should note the presence of the following within the likely area of influence:

* Housing and facilities such as schools, shops etc. * Agricultural activity: types of crops being grown, the presence and extent of grazing; * Irrigation of agriculture: availability of water and source of water supply; * Use of river water for domestic drinking water supply (or of shallow groundwater associated with the river); * Fishing for food. Rapid Site Assessment 47

In all cases, the description should be as quantitative as possible.

Identify the key pathways andpossible impacts

The major pathways expected to result in health or other damage are described under Stage 3 of the methodology. Evidence that pollutants are affecting human health, economic infrastructure, or ecosystems through any of the pathways should be noted. In addition, any evidence of physical damage to crops, building materials or underground piping, or to fisheries should be described or documented in as much detail as possible (all references should also be carefully noted for later follow up). 48 Setting Priorities for Environmental Management: Mining in Bolivia

Table A2.1 Rapid site assessment form

Mine name Date of Visit

1. Nearest sites of human activity (distance)

Dwellings

Workplaces

Main road

Schools

Commercial enterprises

Clinics

Agricultural fields

Livestock

Other

2. Major physical structures and urban infrastructure Yes No Ifyes, describe and give distance

Settlements

Underground piping

3. Sensitive environments Yes No Ifyes, describe and give distance

Wetlands

Fisheries

Other Rapid Site Assessment 49

Table A2.1 Rapid site assessment form (cont.)

4. Water bodies within 3.5 kilometers of site Yes No Ifyes, describe and give distance

Stream

River

Pond

Lake

5. Airborne pollutants Yes No Ifyes, describe

Dust

Smoke

Haze

Other

6. Evidence of contamination or damage Describe in detail

Agricultural fields yellow or unhealthy?

Buildings eroded?

Underground piping corroded?

Evidence of contaminated water?

Evidence of damaged fisheries? 50 Setting Priorities for Environmental Management: Mining in Bolivia

Table A2.1 Rapid site assessment form (cont.)

7. Physical hazards found at site Yes No If yes, describe, giving size, condition and specific location, and indicate whether the feature is likely to represent a physical hazard

Explosives

Drums/tanks/bags for chemicals

Chemicals

Overhead wires or cables

Pipes or poles

Power lines

Power substation

Transformers

Scrap metal

Towers

Placer Tramways

Wooden structures

Other Rapid Site Assessment 51

Table A2.1 Rapid site assessmentform (cont.)

8. Site features Yes No If yes, describe, giving size, condition and specific location, and indicate whether the feature is likely to represent a physical hazard Adits

Buildings

Cisterns

Leach pad

Machinery

Mill building

Mill tailings

Ore stockpile

Pit: large (> 3 meter)

Pit: small (< 3 meter)

Placer mine Quarry Shaft

Solution pond

Subsidence

Sump

Trench

Tunnel

Other 52 Setting Priorities for Environmental Management: Mining in Bolivia

Table A2.1 Rapid site assessment form (cont.)

8a. Water at features Standing Emanating or If water is present passing through

Yes No Yes No Liters! Conduc- pH Color minute tivity Adits Buildings Cisterns Leach pad Machinery Mill building Mill tailings Ore stockpile Pit: large (> 3 m) Pit: small (< 3 m) Placer mine Quarry ==_=_ Shaft Solution pond Subsidence Sump Trench Tunnel

O th e r______I______Rapid Site Assessment 53

Table A2.1 Rapid site assessment form (cont.)

8.b Vegetation at features Healthy Stressed Dead Barren Partial Full Other revegetation revegetation (specify)

Adits

Buildings

Cisterns

Leach pad

Machinery

Mill building

Mill tailings === =

Ore stockpile

Pit: large (> 3 m)

Pit: small (< 3 m)

Placer mine

Quarry__ __

Shaft

Solution pond

Subsidence

Sump

Trench

Tunnel

Other Annex 3

Chief Pathways and Critical and Background Levels of Key Contaminants

Estimating the severity and extent of damage requires judgment. Ideally, some data will exist regarding the ambient concentrations of harmful metals and chemicals in the air, water, soil, plants, or fish. Annex 3 Table 3.1 shows the chief pathways of the pollutants of concern. Table 3.2 lists the ambient concentrations of selected chemicals and metals at which human health and ecosystem damage might begin to become significant as well as normal background levels. The critical values represent, in almost all cases, significant increases over background levels, indicating contamination from man-made sources.

Table A3.1 Chief pathways of exposure to environmental contaminants Food

Water Air Soil Crops Fish

Lead Yes Yes, near smelters Yes, near Yes, near No and roads smelters smelters Mercury No Yes, near smelters No No Yes Cadmium Yes, especially in Yes, near smelters Yes, near Yes, near No mine drainage areas smelters smelters Arsenic Yes, especially in Yes, near smelters Yes Yes Yes mine drainage areas Zinc Yes, especially in Yes, near smelters No Yes No mine drainage areas Silver Yes, especially in Yes, near smelters No Yes No mine drainage areas Acidity Yes, especially in No No No No mine drainage areas Cyanide Yes No No No No

Source: World Health Organization Regional Office for Europe I987; Hutchinson and K. Meema 1987.

54 Chief Pathways and Background and Critical Values of Key Contaminants 55

Table A3.2 Critical and background levels of selected metals and chemicals

Drinking water Air Soil Food

critical background critical background critical background critical background

Lead 50 pg/I < 20 pg/I 2 pg/r3 0.00005 1000 pg/g 11-30 gg/g n.a. n.a. pg/rM3 dry weight dry weight

Mercury 2 pg/I 5-100 ng/I 100 ng/m3 5-10 ng/m3 n.a. n.a. 2000 mg/g < 20 ng/g fresh weight fresh weight

Cadmium 10 pg/I .1-2 pg/l 100 ng/m3 5-50 ng/m3 n.a. 0.12-0.15 n.a. n.a. pg/g dry weight

Arsenic 200 g/gA < 10 pg/I 750 ng/m3 1-10 ng/m3 500 pg/g < 17-24 ptg/g 10 mg/kg I mg/kg dry weight wet weight wet weight

Zinc 5000 pg/I n.a. n.a. n.a. n.a. n.a. n.a. n.a.

Silver 100pg/l n.a. n.a. n.a. n.a. n.a. n.a. n.a.

Acidity pH <4.5 pH 6-9 n.a. n.a. n.a. n.a. n.a. n.a.

Cyanide 100pg/I none n.a. n.a. n.a. n.a. n.a. n.a.

Note: pg is microgram;ng is nanogram;m' is cubic meter; n.a. is data not available. Source: WorldHealth OrganizationRegional Office for Europe 1987;Hutchinson, T. and K. Meema (eds.) 1987. Annex 4

Calculating a Marginal Cost Curve: Example

As an example, a marginal cost approach is outlined for Tierra mine using information contained in the environmental audit. The marginal cost curve cannot be developed fully because of lack of data on the engineering costs of the various remedial measures, but the steps of the procedure can be identified.

The interactions between different metals and between dissolved and suspended phases of the same metal are very complex and depend on the pH of the water and a number of other factors. Nevertheless, the data provided in the audit report allow some broad findings to be developed.

Two of the heavy metals of principal concern are cadmium and lead (although any other metal could be addressed in the same manner). Each year about 18 tons cadmium and 318 tons of lead are released to the Rio Tierra.8 Of these total loads, about 12 percent of the cadmium and 2 percent of lead is in solution. The dissolved concentrations are 20-50 times higher than background levels in a typical Altiplano stream.9 (Samples show that concentrations have dropped to background levels twenty kilometers downstream.)

To calculate the marginal costs of reducing the loads released from the mine, the analyst must first identify the sources of pollution and estimate their relative contribution to the total pollution loadings. Next he or she estimates the costs per ton (or other unit of measurement) of reducing emissions from the various sources.

Using information in the Tierra audit, it appears that the sources of dissolved cadmium and lead are different: the Pila mine dump is the source of about 10-20 percent of the total dissolved cadmium, but less than 1 percent of the lead.'° For lead, the main sources are the town and cooperative areas upstream of the plant and the tailings system, which are responsible for about 5 percent of the lead entering the river system. Some mine drainage waters have a high cadmium content - for example La Bora adit has a discharge with a concentration which is 2-40 times higher than the others."'

Tierra audit, Table 4.1 9 Tierraaudit, Table 3.8 '° Basedon Tierra audit, Figure4.2 and Table 4.1. The exactproportions are not clear. Tierraaudit, Table3.13.

56 Calculating a Marginal Cost Curve 57

A very high proportion of the total metal load in the river is in the form of suspended solids rather than dissolved metals in solution. The proportion depends on a range of factors but is most likely influenced principally by the acidity and the concentration and character of the solids. The key sources of suspended solids are the tailings from the concentrator plant. Of an estimated 8.7 million cubic meters of waste material in the mine, 85 percent is comprised of the tailings in the dam, the other fine tailings in the Pila waste heap and the sediments in the river immediately downstream.'2 The tailings dam alone accounts for 77 percent of the total waste material.

Control of the release of metals must therefore address both the dissolved phase and the solids. The audit report identifies six waste heaps (out of 64) with especially high concentrations of metals that could enter the environment. Five of these are the fine sediment heaps (including the tailings dam) and the sixth is a smaller waste heap above the town. These fine sediment heaps should be one of the top priorities of any remediation program.

Remediation actions to be considered should therefore include:

Stabilizing the sediments in the river * Reducing the releases from the Pila dump Minimizing drainage from the waste heaps to reduce the sulfide and metal levels Stabilizing the tailings dam to avoid releases of overflows and of sediment * Treating the mine drainage * Improving the capture dams to minimize the discharge of sediments to the river.

These suggested remediation actions are broadly in accord with those discussed in the audit report.

Costs of remediation

Unfortunately, the audit does not provide information regarding the engineering requirements or the costs of remediation measures. Many of the actions are potentially interconnected, with the tailings dam as a focal point for water quality control measures, for example. Relatively straightforward engineering estimates could be prepared for the major items.

Calculating the marginal costs of the different potential actions involves estimating the quantities of metals removed from the system (either as annual load or as potential load) for each action and calculating the cost per quantity of pollution avoided. An outline of how a marginal cost curve is calculated (using imaginary cost information) is shown below.

12 Tierra audit, Appendix IV. 58 Setting Priorities for Environmental Management: Mining in Bolivia

For this example, the reduction in the annual dissolved loads of cadmium is the measure of environmental improvement.

I. The Pila tailings heap has a volume of 1.086 million cubic meters and is estimated to discharge about 320 kilograms per annum of dissolved cadmium. (There is no detailed information of the composition of the tailings, but if the tailings contained, say 0.01 percent cadmium, then the quantity of cadmium in the dump would be close to 300,000 kilograms.) Assume that the costs of remediation have been estimated as follows:

a) Cap site and divert drainage, which reduces discharges to 100 kilogram per annum. Cost: US$50,000.

b) In addition to (a), construct trench to intercept subsurface water, reducing discharge to 50 kilogram per annum. Additional cost: US$30,000.

c) In addition to (b), collect and treat the drainage from the sealed dump, reducing the discharge of cadmium to 5 kilograms per annum. at a cost of another US$50,000.

I. Another source of cadmium is the concentrator tailings spillage which is estimated to contribute about 600 kilograms per annum of cadmium. To reduce flows from this source would require a mixture of operational improvements, increased power supplies and new equipment. Assume the cost is US$250,000 and that these actions reduce cadmium flows by 300 kilograms per annum.

II. Dumps and river bed sediments along the river below the concentrator contribute about another 600 kilograms per annum of metal. There will be a number of different site and remedial options which could be examined. Assume the following would be typical:

c) Cap some dumps and divert surface water which reduces discharge by 150 kilograms per annum. Cost: US$50,000.

d) Divert river in lined channels around major areas of sediment which reduces the pollution load by 300 kilograms per annum. Cost is US$500,000. This will disturb the sediments causing the release of metals in the short-run, but will isolate one of the major sources of metals in the long-run.

Table A4. 1 shows the marginal, total, and unit costs for the measures described here. This table could be expanded by including other measures which reduce cadmium. The table could also include calculations for other nearby mines to obtain regional marginal costs for removal of cadmium from the system. Calculating a Marginal Cost Curve 59

As a general rule, decision makers should choose investments which reduce a kilogram of cadmium for the least amount of money. In this example, action L.a (cap site and divert surface water), which removes cadmium at the cost of US$250 per kilogram, is the most cost-effective. By contrast, the least cost-effective action would be III.b (divert river in lined channels), which reduces cadmium at a cost of US$1,667 per kilogram.

Table A4.1 Costs and quantities of cadmium reduction: Example

Quantity of Cost Unit cost Kilograms Cumulative Cumulative cost Average cost metal reduced (USs) (per per US$ metal reduced (US$) per kilogram (kilogram kilogram) per year) la 220 50,000 227 4.0 200 50,000 250 lb 50 30,000 600 1.7 250 80,000 320 Ic 45 50,000 1,111 0.9 295 130,000 440 II 300 250,000 833 1.2 695 380,000 547 IlIa 150 50,000 333 3.0 845 430,000 508 Illb 300 500,000 1,667 0.6 1,145 930,000 812

Finding the least-cost measures does not provide guidance as to how much cadmium should be removed, only the actions to pursue first. The target quantities to be removed depend on the benefits that will be achieved from cadmium removal. Investments in reducing cadmium should be made until the point where marginal benefits equal marginal costs, so it is also necessary to compute the marginal benefits of the investments.

Figure A4.1 Cost per kilogram of cadmium removed

1800 1600-______> 1400- ______1200-

2 1000 _____

o 800 __ _ _

i. 600 -- 4400- ___ - - 200 - _

la lb I Illa Illb Action Annex 5

Inventory of Mines and Smelters in Bolivia, Relative Ranking of Mines by Hazard Potential, and Individual Mine Hazard Scores

This annexcontains an inventoryof minesand smeltersin Boliviawith informationon their location,years of operation,capacity, facilities, distance from nearesttown, nearby rivers, and whetheror not an audit has been carriedout. Data are fromthe February 1995 draft of the Inventoryof Mining Sites.

The annexalso containsa summarytable rankingthe minesby hazardpotential. And it contains detailedhazard scoring spreadsheets for individualCOMIBOL mines for which sufficientdata existsto makejudgments on appropriatescores.

60 Table A5.1 Inventory of mines and smelters in Bolivia Site Type Depart- Years Capacity Facilities Town Kms to River Audit Comments ment (tons per nearest funding year) townb agency

Bolivar Tin/lead/zinc Oruro 1980 - Antequera 5? Antequera Now in joint venture mine with COMSUR Caracoles La Paz World Bank Catavi Processing Potosi 1800? - Conc Llallagua Chayanta/Mamore Bilateral Serves Siglo XX Chocaya Bilateral Chorolque Colavi Colquechaca Colquiri Tin/zinc mine Oruro 1850- 300,000 Conc Caracollo 40 Colquiri/Beni COMIBOL Audit completed Corocoro EMO Tin smelter Oruro 1960?-1980? Smelter Oruro 0 n.a. World Bank Fund. Catavi Huanuni Tin mine Oruro 1??? - 300,000 Conc Machacamarca 30? Huanuni COMIBOL Large coop operations Japo ?/Lake Poop6 Kamin La Palca Tin smelter Potosi 1982-1984 120,000 Smelter Potosf 15 Rivera/Pilcomayo World Bank Machacamarca Smelter ? Oruro - 1985? Smelter Machacamarca 2? Lake Poop6 Bilateral Matilde Morococala Mutun Iron mine Santa - 1985? Smelter? ? Paraguay World Bank Cruz PIO Workshops Oruro 1950? - n.a. Oruro 0 n.a. World Bank PI. Telamayu Smelter Potosi 1972-1980 600 Smelter Tupiza 30? Tupiza/Pilcomayo Bilateral PI. Pulacayo Plahipo Silver leach Potosi 1980?-1990? 120,000 Leach Potosi 2? Rivera/Pilcomayo World Bank Poop6 Lake Poop6 Bilateral Porco Zinc/Silver mine Potosi 1650 - 100,000 Conc? Potosi 5? Tacara/Pilcomayo Rented to COMSUR Pulacayo Rio Yura San Jose Silver/lead mine Oruro 1650 - 1991 120,000 Conc Oruro 0 Lake Uru Uru Bilateral Major impacts in city San Vincente Mine ? Potosi Tupiza? World Bank Santa Fe Lead/silver/tin Oruro Payrumani? 10? Santa Fe/Huanuni Bilateral mine Siglo XX Tin/zinc mine Oruro 1800? - Conc Llallagua Chayanta/Mamore World Bank Large coop operations Tasna Mine? Potosi World Bank Tatasi Bilateral Telamayu Unificada Silver/tin mine Potosi 1545 - 1993 100,000 Conc Potosf 0 Rivera/Pilcomayo Bilateral Many small mines Viloco _ . Vinto Tin smelter Oruro 1972- 20,000 Smelter Oruro 8 n.a. ?? _ ? means unknown, estimate; n.a. means not available. a/ Facilities or, site. .b/ Distance from nearest town likely to be affected by pollution. 62 Setting Priorities for Environmental Management: Mining in Bolivia

Applying the hazard ranking process to nine sites using information available in the February 1995 draft of the Inventory of Mining Sites produces the following list of mines ranked in accordance with their potential to be causing damage to human health or the environment.'3 The results are tentative because of the lack of even basiic information for a number of the sites. Nevertheless, the results are reasonable according to experts in mining and the environment in Bolivia.

Table A5.2 Relative ranking of mines by their hazard potential

Site Score

Javiar 64 Estrella 62 Venus 39 Santa Fe 34 Tierra 23 Marte smelter 14 Luna 15 Jupiter 3 Castillo 2

13 The names of the mines on this list have been changed to protect their identity. They do not therefore match those in the Inventoryof Mining Sites(Table AS. 1). Table A5.3 Mine hazard scoring worksheet: Luna

Mine name Luna 1 2 3 4 5 6 7 8 9 Likely to Severity Number of Health Extent of Materials Sensitivity Environ- Row exist?a and extent persons hazard damage to hazard of exposed mental score ofproblem exposed ranking materials, ranking ecosystems hazard buildings, ranking Hazard etc. Chemicalor metal hazards Lead 9 2 9 2 3 3 243 Mercury 9 2 9 2 3 4 0

Arsenic I 2 8 2 3 2 198 Cadmium 2 7 2 3 207 Zinc 2 9 2 22 l80 Silver 1 9 2 2 3 2 90 Acid generation 2 | 0 2 3 3 234 Cyanide O 9 2 2 2 3 3 O Physical hazards 2 2 9 2 3 324 SITE TOTAL2 bl ei a/ Very likely = 2; possiblein smallquantitiles = 1;Not likely=0. Table A5.4 Mine hazard scoring worksheet: Javiar

Mine name

Javiar 1 2 3 4 5 6 7 8 9 Likely to Severity Number of Health Extent of Materials Sensitivity Environ- Row exist?a and extent persons hazard damage to hazard of exposed mental score of problem exposed ranking materials, ranking ecosystems hazard buildings, ranking Hazard etc

Chemical or metal hazards Lead 9 9 9 3 1,800 Mercury 0 9 9 9 4 0 Arsenic I to 9 9 3 2 780 Cadmium I to 9 7 9 3 3 720 Zinc 2 10 9 2 9 3 2 480 Silver 2 10 2 9 3 2 480 Acid generation 2 10 9 0 9 3 3 540 Cyanide 0 1r0 9 2_ Physical hazards 2 10 9 9 9 3 1,620

SITE TOTAL 6,420 a! Very likely = 2; possible in small quantities = 1; Not likely =0. Table A5.5 Mine hazard scoring worksheet: Estrella

Mine name Estrella 1 2 3 4 5 6 7 8 9 Likely to Severity Numberof Health Extent of Materials Sensitivity Environ- Row exist?a and extent persons hazard damage to hazard of exposed mental score ofproblem exposed ranking materials, ranking ecosystems hazard buildings, rankingl Hazard e Chemicalor metalhazards Lead 10 7 _75 3 Mercury 0 10 9 9 7 5 4 0 Arsenic 10 8 7 _ 2 820 Cadmium I 10 9 7 7 5 3 780 Zinc 2 10 9 2 2 560 Silver 2 10 9 2 2 560 Acid generation 2 10 9 0 7 2 3 580 Cyanide I 10 9 2 7 5 3 330 Physical hazards 2 10 9 9 7 1,620 SITETOTAL 6,210 a! Very likely = 2; possiblein small quantities= 1; Not likely =0. ON Table A5.6 Mine hazard scoring worksheet: Jupiter

Mine name Jupiter 1 2 3 4 5 6 7 8 9 Likely to Severity Number of Health Extent of Materials Sensitivity Environ- Row score exist?a and extent persons hazard damage to hazard of exposed mental ofproblem exposed ranking materials, ranking ecosystems hazard buildings, ranking Hazard e Chemicalor metal hazards Lead O 2 9 3 3 0 Mercury 5 2 3 3 4 0 Arsenic 1 5 2 8 3 2 110 Cadmium 1 5 2 7 3 3 115 Zinc 2 5 2 2 3 3 2 100 Silver O 5 2 2 3 3 2 | Acid generation O 5 2 O 3 2 3 3 O Cyanide O 5 2 2 3 3 | Physical hazards 5 2 9 3 3 ° SITE TOTAL 325 a/ Very likely = 2; possible in small quantities = 1; Not likely =0. Table A5.7 Mine hazard scoring worksheet: Venus

Mine name

Venus 1 2 3 4 5 6 7 8 9 Likely to Severity Number of Health Extent of Materials Sensitivity Environ- Row score exist?a and extent persons hazard damage to hazard of exposed mental ofproblem exposed ranking materials, ranking ecosystems hazard buildings, rankingl Hazard etc.

Chemical or metal hazards El" Lead I 10 6 9 5 3 690 Mercury 0 10 6 9 5 4 0 Arsenic I 10 6 8 5 2 580 Cadmium I 10 6 7 1 5 3 570 Zinc 2 10 6 2 1 5 2 440 Silver I 10 6 2 1 5 2 220 Acid generation 2 10 6 0 1 2 5 3 340 Cyanide 0 10 6 2 1 5 3 0 Physicalhazards . 6 9 1,080

SITE TOTAL 3,920 a/ Very likely = 2; possible in small quantities = 1; Not likely =0. 00 Table A5.8 Mine hazard scoring worksheet: Marte smelter

Mine name Marte smelter 1 2 3 4 5 6 7 8 9 Likely to Severity Numberof Health Extent of Materials Sensitivity Environ- Row score exist?a and extent persons hazard damage to hazard of exposed mental ofproblem exposed ranking materials, ranking ecosystems hazard buildings, ranking Hazard et

Chemicalor metal hazards _ 11 Lead 6 5 9 4 Mercury 6 5 9 4 4 O Arsenic I 6 5 8 4 2 288 Cadmium 2 6 5 7 4 3 564 Zinc 2 6 5 2 4 4 2 216 Silver O 6 5 2 4 4 2 O Acidgeneration 0 6 5 0 4 2 4 3 O Cyanide 0 6 5 2 4 4 3 O Physical hazards 0 6 5 9 4 4 0 SITE TOTAL 1,410 a/ Very likely= 2; possiblein small quantities= 1; Not likely=0. Annex 6

Site Specific Recommendations for Further Investigation for Environmental Improvement

Table A6.1 Recommendations for further investigation: Sol

Recommended lnvestments |Benefits

Responsibilityof the Secretariatof Mines

Seal playgroundsand other play areas that have been Reduce incidenceof brain damageand other health built on mine material. damagedue to exposureto lead and other heavy metals and metalloids.

Remediatephysical threats from abandonedmining Reduce risk of accidentalinjury and death. operations. Channeland treat acid rock drainage. Lengthenthe lifetimeof undergroundpipes, reduce the flow of contaminationto both Lake Crist6baland the region's aquifers.

Move the Domingodump, shapethe old site, and Reduce damageto human health,infrastructure, constructditches to collect acid rock drainage. aquifers,and Lake Crist6bal. Free land for urban development.

Provideeducation and technicalassistance to Improvedecisionmaking for environmental develop capacityfor environmentalmonitoring and management,leading to more efficientuse of the developmentof new and ongoingmining resources. activities.

Responsibilityof the municipality

Repairor replacepipe deliveringdrinking water to Improvequality and quantityof drinkingwater, the city. - reducingthe incidenceof waterbomediseases. Controldust fromurban roads built with mine waste Reducethe numberof respiratorydiseases and rock. diseasescaused by exposureto lead and arsenic.

69 70 Setting Priorities for Environmental Management: Mining in Bolivia

Table A6.2 Recommendations for further investigation: Luna RecommendedInvestments -TBenefits Responsibilityof the Secretariatof Mines

Activitiesto remove impedimentsto private Increasevalue of property. investment. Seal playgroundsand other play areas that have been Reduce incidenceof brain damageand other health builton mine material. damagedue to exposureto lead and other heavy metalsand metalloids.

Remediatephysical threats fromabandoned mining Reducerisk of accidentalinjury and death. operations. Provideeducation and technicalassistance to Improvedecisionmaking for environmental developcapacity for environmentalmonitoring and management,leading to more efficientuse of the developmentof new and ongoingmining resources. activities.

Responsibilityof the municipality

Repairor replacepipe deliveringdrinking water to Improvequality and quantityof drinkingwater, the city. reducingthe incidenceof waterbornediseases. Controldust from urbanroads built with mine waste Reducethe numberof respiratorydiseases and rock. diseasescaused by exposureto lead and arsenic. Constructa sewagecollection system. Reduce incidenceof waterbomediseases and increase amenityvalues associated wit living in a cleaner environment.

Responsibilityof new mine operatoror COMIBOL

Ventilatethe mine. Reducethe incidenceof silicosisand lung cancer. Site SpecificRecommendations for FurtherInvestigation for EnvironmentImprovement 71

Table A6.3 Recommendations for further investigation: Tierra RecommendedInvestments Benefits

Responsibilityof the Secretariatof Mines

Activitiesto remove impedimentsto private Increasevalue of property. investment. Remediatephysical threats from abandonedmining Reduce risk of accidentalinjury and death. operations. Seal playgroundsand other play areasthat have been Reduceincidence of brain damageand other health built on mine material. damagedue to exposureto lead and other heavy metals and metalloids.

Stabilizethe San Marco tailingsdam. Reduce risk of accidental injury, death, ar.d property destructionfrom a landslide. Provideeducation and technicalassistance to Improvedecisionmaking for environmental developcapacity for environmentalmonitoring and management,leading to more efficientuse of the developmentof new and ongoingmining resources. activities. Identifythe sources and pathwaysfor mercury Reducethe incidenceof mercurypoisoning and contamination. ecosystemdamage.

Responsibilityof the municipality

Repairor replacepipe deliveringdrinking water to Improvequality and quantityof drinkingwater, the city. reducingthe incidenceof waterbomediseases. Controldust from urban roads built with mine waste Reducethe numberof respiratorydiseases and rock. diseasescaused by exposureto lead and arsenic. :: g Bibliography

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Selecting Highest Priority Activities and Investments for Environmental Management in Mining Areas of Bolivia

This workbook outlines the steps and defines the data needed to carry out cost-benefit analyses for investments and actions to reduce damage from environmental degradation. The approach is illustrated with examples for a variety of problems and investment options.

The workbook covers the types of problems most likely to be found in the mining communities of Bolivia. However the approach can easily be adapted to evaluate investments and actions for environmental protection in communities with different types of issues. Sources for tables and figures, unless otherwise noted, are the authors' calculations.

Workbook Contents

1 INTRODUCTION ...... 79 Pollutants Hazardous to Human Health ...... 79 Pollutants Damaging to Infrastructure and Ecosystems ...... 79

2 CALCULATING THE BENEFITS AND COSTS OF REMEDIATING PHYSICAL THREATS LEFT BY OLD MINE OPERATIONS .81 Benefits ... 81 Costs. 8 1

3 DESIGNING A PROGRAM FOR REDUCING HEALTH DAMAGE FROM EXPOSURE TO LEAD .82 Steps Required .82 Benefit-Cost Analysis: Calculating the Present Value of Actions to Reduce Exposure to Lead .87

4 DESIGNING A PROGRAM FOR REDUCING HEALTH DAMAGE FROM EXPOSURE TO ARSENIC ...... 99 Steps Required ...... 99

5 DESIGNING A PROGRAM FOR REDUCING DAMAGE TO INFRASTRUCTURE AND ECOSYSTEMS DUE TO ACID ROCK DRAINAGE ...... 102 Steps Required to Design a Program to Reduce Acid Generation...... 102 Benefit-Cost Analysis: Calculating the Present Value of Actions to Reduce Damage to Infrastructure and Ecosystems ...... 103

6 REMEDIATING MINE SITES TO ATTRACT PRIVATE INVESTMENT ...... 107

7 FINANCIAL INCENTIVES FOR CLEANING UP THE ENVIRONMENT WHILE REMINING OLD TAILINGS AND WASTE ROCK .... 108

77 78 Setting Priorities for Environmental Management: Mining in Bolivia

Workbook Tables

W. 1 Major threats due to hard-rock mining in Western Bolivia ...... 80 W.2 Pathways of exposure with critical and background levels: Lead ...... 82 W.3 Sources of lead exposure...... 83 W.4 Data needed to develop a program to reduce health damage from lead ...... 84 W.5 Possible actions for reducing exposure to lead in Sol...... 85 W.6 Estimating the benefits of reducing blood lead levels in children ...... 89 W.7 Estimating the benefits of reducing blood lead levels in children in Sol by 20 micrograms per deciliter ...... 90 W.8 Estimating the benefits of reducing blood lead levels in adult males ...... 94 W.9 Annual and present values of reducing soil lead exposure of adult males in Sol...... 98 W.l0 Pathways of exposure with critical and background levels: Arsenic ...... 100 W. 11 Data needed to develop a program to reduce exposure to arsenic ...... 100 W.12 Possible actions to reduce exposure to arsenic ...... 101 W.13 Possible actions for reducing acid rock drainage...... 102 W. 14 Data required to estimate benefits of reducing acid rock drainage in Sol ...... 103 W.15 Benefits of reduced maintenance and repair costs and ecosystem protection in Sol ...... 106

Workbook Figures

W.1 Developing a cost-effective approach to reducing exposure to lead: Decision-tree ....86 1 lutroduction

The threats to human health from mining include physical risks, such as falling into mining shafts, and diseasesfrom exposureto heavy metals, metalloids,and chemicals. Accidentsare the most commoncause of health damage at mining sites around the world. Preventingaccidents is also relativelyinexpensive to achieve, involving closing unused adits, removing machineryand explosives, filling holes, and stabilizing tailings piles. Thus a program to reduce accidents should be the first task in remediatingmine sites where the objective is to protect human health from hazards due to mining.

POLLUTANTSHAZARDOUS TO HUMANHEALTH

The pollutants from mining that are most likely to be damaging health in Western Bolivia are lead, arsenic and cadmium. Lead is the most hazardousof these pollutants: there is considerable evidencethat shows lead causes brain damage in children and cardiovascularand other diseases in adults, even at low doses. The relationshipbetween exposure to lead and health damage has been summarizedin dose-responsefunctions which makes it possible to quantify the benefits of reducing lead exposure. The evidence for arsenic and particularly for cadmium is much less clear.

A programto remediatemine waste whose objective is to protect human health should therefore be concernedfirst with reducingexposure to lead, and then on reducing exposureto other heavy metals and metalloids such as arsenic and cadmium. A program to reduce exposure to lead would also be likely to reduceexposure to arsenic and cadmium.

POLLUTANTSDAMAGING TO INFRASTRUCTUREAND ECOSYSTEMS

Contaminationfrom mining also damages infrastructureand ecosystems. Acid rock drainage corrodesunderground piping and weakens building foundations. Acid rock drainage and heavy metals damage aquatic ecosystems;heavy metals may bioaccumulatein fish flesh and in plants exposingorganisms throughout the food-chainto toxins.

This workbookoutlines the steps and definesthe data requiredfor designingprograms to reduce damage to human health, economic infrastructure, and the environment from past mining activities in Western Bolivia. The workbook provides examplesof how to apply benefit-cost analysis to evaluate particular actions for reducing damage, once the data have been collected. The numbers used in the examples are fictitious, and are intended merely to illustrate the approach. The workbook covers the hazards most likely to be found in mining communitiesin WesternBolivia: physical hazards, lead, arsenic,and acid rock drainage. The workbookdoes not discuss mercury,since this element is not widespreadin these areas. Mercury is highly toxic to humansand to ecosystems,and shouldbe addressedwhere it is found.

79 80 SettingPriorities for EnvironmentalManagement: Mining in Bolivia

Table W.1 below lists the major threats to human health, infrastructure, and ecosystems in mining communities in Western Bolivia in order of importance.

Table W.1 Major threats due to hard-rock mining in Western Bolivia

HUMAN HEALTH

Physical hazards Accidents

Heavy metals and chemicals Lead Arsenic Cadmium

INFRASTRUCTURE AND MATERIALS

Acid generation

ECOSYSTEMS

Lead Cadmium Acid generation Arsenic 2 Calculating the Benefits and Costs of Remediating Physical Threats Left by Old Mine Operations

In many Bolivian mining centers, abandoned mining operations pose a considerable risk of injury or accidental death to those living or working nearby. The hazards may include mine openings such as shafts and adits, unstable ground, unsecured tailings or waste rock piles, abandoned explosives or electrical or mechanical equipment,dilapidated buildings, and tram cables. In the United States the leading cause of injury or death at abandonedmine sites is by falling into mine openings.'4

BENEFITS

The benefits of addressing these risks would be a reduced likelihood of injury or accidental death. The benefitswould be valued as the willingnessto pay to reduce this risk. Unfortunately there are no data regardingthe amount Bolivians would be willing to pay to improve safety. In the United States hedonicwage and contingentvaluation studies have found that individualsare willing to pay between US$2-7 each to reduce the risk of death by one in one million."5 Aggregatedover a large population,this amountsto between US$2-7 million per death avoided. This death avoidedis also called a "statisticallife." Taking the lower bound, US$2 million, and adjustingthis to reflect differencesin per capita incomesbetween the United Statesand Bolivia,"6 gives a figure of about US$59,350as a plausible minimumBolivians would be willing to pay to save a statisticallife.' 7

COSTS

A program to assess and remediate physical hazards from old mining operations in Bolivia would likely cost less than US$100,000 for each mining center. This activity would be worth doing if it would be expected to save two statistical lives. The activity would generate the highest benefits on mining sites with large populations exposed to the risks, such as Sol.

14 United StatesDepartment of Interior,Bureau of Mines,Abandoned Mine Inventoryand HazardEvaluation Handbook,May 1994. Is fHedonicwage studies derive estimates of what people are willing to pay for safety by comparingwage rates for two jobs that are identicalin all respectsexcept for the risk of accidentaldeath. Contingentvaluation studies use surveys and questionnairesto ask people directly what they would be willing to pay for non-market goods,such as safetyor environmentalservices. 16 Recentdata showper capitaincome in the UnitedStates to be US$26,980and in Boliviato be US$800. Therefore,United Statesvalues have been dividedby 33.7 to estimateBolivian values (World Bank, 1997.) 17 Of coursethis valuewill growas incomesgrow.

8I 3 Designing a Program for Reducing Health Damage from Exposure to Lead

STEPS REQUIRED

Collect data on blood-lead levels

The first step in developing a program to reduce health damage from lead-exposure is to collect data on blood-lead levels to ascertain whether lead-exposure is a problem in the community. Blood-lead levels above 10 micrograms per deciliter in children indicate that exposure is high enough to be causing health damage (in regions of the United States with few sources of lead contamination, blood-lead levels average 5 micrograms per deciliter in children and adults).

Identify the pathways of exposure

Exposure to lead comes from ingesting food, soil and dust, from drinking water or from breathing air. Table W.2 lists the pathways of exposure for lead. Table W.2 also shows levels of contamination critical for human health. These are levels at which persons exposed to contaminated food, soil, water, or air will likely experience elevated blood-lead levels, with consequent health damage. The numbers in the table are intended as guides to assist in identifying the major pathways of lead exposure, and possible areas for remediation.

Table W.2 Pathways of exposure with critical and background levels: Lead

Drinking water Air Soil Crops Fish critical background critical background critical background critical background critical background

Lead 50 l.g/l <20 gg/1 2 Zsg/m3 0.00005 1,000 ig/g 16 g±g/g n.a. n.a. n.a. n.a. Ig/ m' dry weight dry weight

Note: Critical levels are levels consideredpotentially dangerous to human health. The figures are from World Health OrganizationRegional Office for Europe 1987;Hutchinson and Meema 1987;jig is microgram;I is liter;g is gram; n.a. is not available.

Identify the major sources of lead contamination and estimate the relative contribution of each to elevated blood-lead levels

Major sources of lead in the environment are vehicles using leaded-gasoline, smelters, lead paint, road-dust, batteries, food storage cans, and lead-glazed pottery (see Table W.3). As far as possible, analysts should estimate the relative importance of each source to elevated blood-lead

82 Workbook 83 levels. A program to reduce health damage from lead should consider first the feasibility and costs of controlling lead from the most important sources.

Table W.3 Sources of lead exposure

Very important Moderately important Unimportant

Leaded gasoline

Emissions from smelters

Dust from roads

Dust from tailingspiles

Drinkingwater (may be contaminatedat the source, or throughleaching from lead pipes).

Lead paint

Lead-glazedpottery

Food storagecans

Toys and pencils

Batteryrepair shops

Others

Data needs

To estimate the relative importance of the various pathways and sources requires data on lead levels in air, soil, dust, drinking water and food. Data are also needed on the sources of lead in the home environment, such as pottery, paint and pencils. Variations in blood-lead levels by neighborhood or district can provide clues to major sources of exposure. For example, if blood- lead levels are particularly high among children attending a particular school, the source may be the school environment and involve lead paint or contaminated soil. 84 Setting Prioritiesfor EnvironmentalManagement: Mining in Bolivia

Table W.4 Data needed to develop a program to reduce health damage from lead

Data required Collectionmethod

Blood lead levels. Blood sampling.

Levelsof lead in drinkingwater, air, soil, crops, Environmentalsampling. and fish.

Sourcesof lead in the home environment. Samplingof dust in the home; surveysto determineif objectscontaining lead are being used in the home.

Sourcesof lead contamination. Variationsin blood lead levelsby residentialor school districtmay give clues to major sources of exposure. Informationabout emissions to air from vehiclesor smeltersor dischargesto water from ore processingfacilities may help identifysources.

Identify actions for reducing exposure

There are many potential actions for reducing exposure to lead. The lowest-cost actions generally involve changes of behavior, such as washing hands and living areas, installing and using window coverings, and avoiding pottery and toys containing lead. The effectiveness of these measures depends on the willingness of the community members to participate. Remediating mine waste would prevent lead exposure from mining sources without requiring changes in behavior but would cost considerably more. See Table W.5 for actions that reduce health damage from lead exposure. Workbook 85

Table W.5 Possibleactions for reducingexposure to lead in Sol

Action Cost Comments

Mine wasteremediation Paveor seal Medium Wouldreduce a majorsource of exposureto childrenunder age 7, the most vulnerable playgrounds groupto lead poisoning. Wouldalso reduceexposure to arsenic,cadmium, and copper of children.

Pave in-townroads TBD Wouldcontrol a major sourceof airbome lead,and provide otherbenefits such as lower transportationcosts and amenitybenefits.

Move or cap Medium Wouldreduce exposure to cadmium,arsenic, and copperin additionto lead. Would Domingodump providebenefits to infrastructureand ecosystemsin additionto humanhealth.

Other actions Encouragehand Low Effectivenessdepends on the willingnessof the familyto acceptthis approach,and on washing the availabilityof clean water.

Installwindow Low Effectivenessdepends on participationof the family. coveringsin homes

Fence off Low Effectivenessdepends on willingnessof inhabitantsto obey prohibitions. contaminatedareas

Teachpeople to Low Effectivenessdepends on participation. avoid leadedcans

Encouragepeople to Low Effectivenessdepends on participation. use lead-freepottery

Remediatelead paint Medium May make problemworse in the short-run. House to houseremediation can be expensive. Encouragethe useof Low Effectivenessdepends on participation. lead-freetoys

TBDis to be determined

Rankingactions in terms of benefitsand costs

The final step to developinga programto reduce health damage from lead is to analyze each of the likely actions in terms of its benefits and costs using the benefit-costframework for reducing exposure to lead outlined below. The preferred actions are those which provide the largest benefitsfor the resourcesexpended. The steps are outlined in the decision-treebelow. 86 Setting Prioritiesfor EnvironmentalManagement: Mining in Bolivia

Figure W.1 Developing a cost-effective approach to reducing exposure to lead: Decision tree

No a No need to address lead contamination

Are blood lead levels of children and adults above 10 micrograms per deciliter?

Yes Identify major pathways (see Table W.2)

Identify actions for Develop cost-effective reducing exposure, program for reducing estimate relative costs exposureto lead, by (see Table W.5) comparing the benefits and costs of each action (see benefit-cost worksheets)

Identify major sources and estimate the relative contributionof each to elevatedblood-lead levels

(see Table W.3) W7orkhook 87

BENEFIT-COST ANALYSIS: CALCULATING THE PRESENT VALUE OF ACTIONS TO REDUCE EXPOSURE TO LEAD

Paving or sealing playgrounds built with mine tailings to reduce exposure by children to lead

Lead is very damaging to human health. Children exposed to even low doses of lead mav suffer subtle brain damage and learning disorders, including lower lQs, impaired attention, speech and language deficits, and behavior problems. These effects may persist throughout a person s lifetime, with long-term effects on educational attainment, employability, and ability to cope with the stresses of life. Adult males exposed to lead are more likely to suffer hypertension. nonfatal heart-attacks, and early death. Acute exposures can cause colic, shock, severe anemia, acute nervousness, kidney damage, irreversible brain damage and even death. Women of child- bearing age are at special risk, as the potential for harmful impacts on fetal development is significant. This problem is of special concern for women working in lead industries. such as lead smelters.

The most important indicator of lead exposure for human beings is the amount of lead in the blood. There is increasing evidence that health damage begins to occur when lead in the blood exceeds 10 micrograms of lead per deciliter of blood. In the United States and other countries where lead in gasoline, paint, water pipes, and pottery has been substantially reduced or eliminated, blood lead levels among children average 4-6 micrograms per deciliter. In countries that have not yet taken these steps, blood lead levels can easily average 25 micrograms per deciliter and exceed 40 micrograms per deciliter in some cases.

Studies in the United States and elsewhere have associated an one microgram per deciliter increase in blood lead with a .25 point decline in IQ. In the United States, studies have estimated that each IQ point is worth a present value of about US$5,550 in lifetime earnings." Converting this to reflect the difference in earnings between the United States and Bolivia gives a present value of US$165 per IQ point in Bolivia.

Soil and house dust are important sources of exposure to lead, especially among those young enough to be playing on the ground, mouthing toys and other objects. and licking dirty hands. Soil lead levels above 1,000 micrograms per gram dry weight are considered critical, and likely to be damaging human health.

At present there are no data regarding either blood lead levels or the level of lead in playground soils in the mining communities of Bolivia. However, the approach for calculating benefits of paving playgrounds (or another activity) can be demonstrated using plausible assumptions, as follows:

Is This estimate is from the United States Environmental Protection Agency. 88 Setting Prioritiesfor Environmental Management: Mining in Bolivia

a) Blood lead levels are 25 micrograms per deciliter compared with 5 micrograms per deciliter for the United States (it is assumed that man-made sources of lead in the environment contribute 20 micrograms of lead per deciliter of blood in Bolivia). b) Exposure to soil lead contributes 30 percent of the total elevated blood lead levels (other sources of lead include leaded gasoline, pottery, lead in water, etc.). Thus eliminating this source of exposure would reduce blood lead levels by 6 micrograms per deciliter (20 x .30 = 6). c) The number of children age 7 in Sol (the population most at risk are children age 7 and below) is about 2,700. Each child suffers a permanent loss of 1.5 IQ points as a result of exposure to soil lead. For Sol, the total loss of IQ points for each cohort of 7-year olds is about 4,050 (1.5 points x 2,700 children) per year. d) The present value of each IQ point is about US$165. Thus the present value of the loss of productivity to each year's cohort of 7-year olds of Sol is about US$688,250. e) A project to seal or pave playgrounds in Sol would last about ten years and prevent about US$4.1 million (present value using a discount rate of 10 percent) in lost productivity. A project to prevent lead exposure from playgrounds that costs less than US$4.1 million would be worth doing.

This analysis probably underestimates the value of undertaking a program to seal or pave playgrounds, since doing so would also reduce the exposure of children to arsenic, cadmium, zinc, and copper, which may also damage health.

Table W.6 shows the full approach in summary form, including data needs. Table W.7 provides an example using plausible assumptions. Table W.6 Estimating the benefits of reducing blood lead levels in children

A 13 C ] D E F G | [

Pa/llmav's of Critical Contribution to total Calculating benefits oJ reducing blood lead levels exposure levels blood lead

IPercent Contribution Reduction in IQ point IQ point Present Number Benefits of Benefits for ten in points. blood lead per pg/dl per child value per of reducing soil cohorts of given initial due to action IQ point childrcn lead exposure remediating blood lead (US$) age 7 for each cohort each pathway of 7-year olds (presetnt value. US$)b

(A xXXg/dl)a (C x D) (E x F x G)

Soil 1.000 lig/g 30 0.25 165

Watcr 50 pg/I 10 0.25 165

Air 2 pg/m3 40 0.25 165

Food n.a. 20 0.25 165

IQ point per 100 ug/deciliter pg is microgram: dl is deciliter: g is gram: m3 is cubic meter: n.a is not available. a] Column A multiplied by current levels of blood lead, denoted by X. b/ Using a discount rate 10 percent.

00 Table W.7 Estimating the benefits of reducing blood lead levels in children in Sol by 20 micrograms per deciliter

A L3 C [) I" G(i 1 I

Pathwlavsof (Critical Contriblution to total Calcutlatingbenefits of reducing blood lead leve/s e.xposure levels blood lead

Percent Contribution Reduction in IQ point IQ point Present Numbcr Benefits of Benefits for ten in points. blood lead per lg/dl per child value per of reducing soil cohorts of gixen initial due to action IQ point children lead exposure remediating blood lead (US$) age 7 for each cohort each pathway of 7-year olds (present value. USS)b

(A x A ,Ig/dl)a ((Cx D) (E x F x G)

Soil 1.000pg/g 30 7.5 6 0.25 1.5 165 2,700 688,250 4,106,107

Water 50 pg/I 10 2.5 2 0.25 0.5 165 2,700 222,750 1,368,702

Air 2 pg/m3 40 10.0 8 0.25 2.0 165 2,700 891,000 5,474,809

Food na. 20 5.0 4 0.25 1.0 165 2,700 445,500 2,737,405

10 point per 100 25.0 aig/deciliter pg is microgram: dl is deciliter: g is gram; m3 is cubic meter; n.a is not available. a! Column A multiplied by current levels of blood lead, denoted by X. b/ Using a discount rate 10 percent. Aote. These calculations are based on plausible assumilptions.Calculating the actual benefits requires data on blood lead levels and levels of lead in the soil. Workhook 91

Remediating the Domingo waste rock dump

The Domingo waste rock dump is believed to be an important source of dust containing lead, arsenic, and cadmium in Sol, which may be damaging human health, and of acid rock drainage, which may be damaging urban infrastructure and contaminate the region's aquifers and environment. The dump has been used as a building site for urban dwellings, and is clearly exposed in some unpaved streets and backyards, allowing inhabitants to come into direct contact with the heavy metals and metalloids contained in this material.

Removing or sealing the dump would likely reduce the exposure of the population to heavy metals and metalloids through airborne dust or direct contact. In addition. remediating the waste rock dump would reduce the flow of acid waters which may be damaging the city's infrastructure and region's environment. Finally, the project would make land available in the center city for urban development. The benefits would be valued as (a) the benefits of reduced health damage, (b) the incremental increase in the lifetime of the drinking water and sewerage systems, (c) savings in operation and maintenance costs for water and sewerage systems, (d) savings in building materials and repair costs, (e) the benefits of reducing damage to aquifers and ecosystems, and (f) the added supply of urban land for development.

Reducing h7uminanhealth dam11age

Heavy metals and metalloids, such as lead, cadmium, and arsenic damage human health. Lead causes hypertension, coronary diseases, and premature mortality among adult men in addition to its impact on children described in Section 1. Arsenic has been linked to a treatable form of skin cancer, liver dysfunction, vascular disturbances and possibly lung cancer. Cadmium causes renal dysfunction.

Lead. Studies in the United States and elsewhere have associated an one microgram per deciliter increase in blood lead with an increase of (a) 3,630 cases of hypertension per 100,000 males aged 20-70. (b) 17 cases of nonfatal heart attacks per 100,000 men aged 40-59, and (c) 17.5 premature deaths per 100,000 men aged 40-59.

At present there are no data regarding either blood leads or the amount of lead in the soil of the Domingo waste rock pile. However, it is possible to estimate benefits of reducing exposure to lead in soil by remediating the Domingo waste rock pile, using plausible assumptions. as follows: a) Blood lead levels are 20 micrograms per deciliter compared with 5 micrograms per deciliter for the United States. Thus, it is assumed that blood levels can be reduced by 15 micrograms per deciliter with environmental controls in Bolivia. 92 Setting Priorities for Environmental Management: Mining in Bolivia b) Exposure to lead in the waste rock pile contributes 30 percent of the total elevated blood lead levels (other sources of lead include leaded gasoline, pottery, lead in water, etc.); thus eliminating this source of exposure would reduce blood lead levels by 4.5 micrograms per deciliter (15 micrograms per deciliter x .30 = 4.5 micrograms per deciliter). c) The number of adult males ages 20-70 in Sol is about 22,800. The number of adult males ages 40-59 is about 6,850. d) In the United States, costs for medical care and lost work time for hypertension are US$450 and for nonfatal heart attacks are US$5,667. In 1990, medical expenditures per capita averaged US$2,763, while in Bolivia medical expenditures per capita averaged US$25'9 (World Bank, 1993). If costs for hypertension and nonfatal heart attacks accounted for the same proportion of total medical expenditures in Bolivia as in the United States (16.3 percent and 205 percent respectively), then each hypertension case in Bolivia would be valued at about US$4.07, and each case of nonfatal heart attacks would be valued at US$51.25. The value of preventing one premature death in Bolivia would be US$59,350, as discussed above in the section on calculating the benefits and costs of remediating physical threats left by old mining operations. e) Thus the total annual benefits of reducing cases of hypertension in Sol would be US$15,158 (.0363 cases per person per 1 microgram per deciliter x 4.5 micrograms per deciliter decline in blood lead due to soil remediation x US$4.07 per case x 22,800 males). The total annual benefits from reducing nonfatal heart attacks due to exposure to lead soil would be about US$268. The total annual benefits in Sol from preventing a premature death would be US$319,595.

The annual benefits of reducing diseases among adult males in Sol due to lead exposure from contaminated soil would thus be US$335,000. The total present value computed for a period of 50 years would be about US$3.3 million, assuming a discount rate of 10 percent (Table W.9). These benefits would be addition to benefits to children, as described above.

Other heavy metals. There are no reliable dose-response functions available to relate human exposure to arsenic or cadmium to health impacts, so benefits from reducing exposure to these metals cannot be quantified. However, a program to monitor the concentration of these metals in blood or urine could give an indication of whether exposure levels are high enough to cause concern. Benefits from reducing exposure to arsenic and cadmium would be in addition to those from reducing exposure to lead.

19) In 1990 medical expenditures accounted for 12 percent of United States' Gross Domestic Product and 4.5 percent of Bolivia's Gross Domestic Product. Workbook 93

Infrastructure and ecosystem benefits

The approach for estimating infrastructure (categories b, c, d of the benefits defined above), and ecosystem benefits is described in chapter 5, below. Assuming that the Domingo waste rock dump is responsible for 10 percent of the total acid rock drainage seeping through the city and into the environment, benefits from remediating this source would be valued at about US$120,500 (present value).

Total benefits

Total quantifiable benefits for remediating the Domingo waste rock dump could thus be about US$3.5 million. In addition, there would be nonquantifiable benefits to health from reducing exposure to arsenic, cadmium, and other heavy metals, and by making land available for development.

Summary of potential benefits of remediating the Domingo waste dump

Benefitcategory Presentvalue (USS)

Reducedhealth damagedue to exposureto lead Hypertension 150,500 Nonfatalheart attacks 2.500 Prematuremortality 3,200,000

Reducedhealth damagedue to exposureto arsenicand cadmium n.a.

Reduceddamage to infrastructureand ecosystems 120,500

Total 3,473,500 Table W.8a Estimating the benefits of reducing blood lead levels in adult males: Hypertension

A B C [D E F G H I

Pathways of Critical Contributionito total blood Calculating benefits of reducing blood lead levels exposure levels lead

Percent Contribution Reduction in Hyper-tension Reduction in Number of Reduction in Value per case Annual benefits in points, blood lead to cases per casesdue to adult males cases per (US$) of reducing given initial 5 ptg/dl adult male age remediation of ages 20-70 in year in Sol hypertension per blood lead of 20-70 per 5 source per Sol per pathway pathway in Sol 20 ug/dl iig/dl per year 1,000 adult (US$) males

(A x X g/dl,)a (C x D) (E x F) (G x H)

Soil I .00O .g/g 30 6 4.5 0.0363 0.1634 22.800 3,724 4.07 15,158

Water 50 i-g/I 10 2 1.5 0.0363 0.0545 22,800 1,241 4.07 5.053

Air 2 sg/m3 40 8 6 0.0363 0.2178 22.800 4.966 4.07 20.211

Food nia. 20 4 3 0.0363 0,1089 22.800 2.483 4.07 10.105

IQ point per 100 20 15 ag/deciliter

pjg is microgram: dl is deciliter: g is gram; m' is cubic meter; n.a is not available. a/ Column A multiplied by total potential reduction in blood lead (in this example. 15 ptg/dl).denoted by X. Table W.8b Estimating the benefits of reducing blood lead levels in adult males: Nonfatal heart attacks

J K L M N 0 P

Pathways of exposure

Reduction in Nonfatal heart Reduction in cases Number of adult Reduction in cases per Value per case Annual benefits of blood lead to 5 attacks cases per due to remediation of males in Sol ages year in Sol per (US$) reducing nonfatal heart tLg/dl adult male ages 40- source per adult male 40-59 pathway attacks in Sol per 59 per ig/dl pathway

(A x AX,&gldl)a (Jx K) (L x MI) (Alx 0)

Soil 4.5 0.00017 0.000765 6.838 5 51.28 268

Water 1.5 0.00017 0.000255 6.838 2 51.28 89

Air 6.0 0.00017 0.001020 6.838 7 51.28 358

Food 3.0 0.00017 0.000510 6.838 3 51.28 179

Total 15

p.gis microgram: dl is deciliter; g is gram; ml is cubic meter: n.a is not available. a! Column A multiplied by total potential reduction in blood lead(in this example. 15 pg/dl). denoted by X. Table W.8c Estimating the benefits of reducing blood lead levels in adult males: Premature deaths

Q R S T U V W

Pathways of exposure

Reductionin Prematuredeaths per Reductionin cases Numberof adult Reductionin casesper Value per case Annual benefitsof blood leadto 5 adult male ages40-59 due to remediationof malesin Sol ages year in Sol per (US$)b reducing premature l.g/dl per pg/dl sourceper adult male 40-59 pathway mortality in Sol per pathway

(A x ug/dl)a (Qx R) (Sx T) (Ux V)

Soil 4.5 0.000175 0.000788 6.838 5 59.350 319,595

Water 1.5 0.000175 0.000263 6.838 2 59.350 106.532

Air 6.0 0.000175 0.001050 6.838 7 59.350 426.127

Food 3.0 0.000175 0.000525 6.838 4 59,350 213.064

Total 15 jag is microgram:dl is deciliter, g is gram; m' is cubic meter:n.a is not available. a/ Column A multiplied by total potentialreduction in blood lead (in this example, 15 jag/dI),denoted by X. b/ The valueof a statistical life as describedin chapter2. Table W.8c Estimating the benefits of reducing blood lead levels in adult males: Summary x

Annual total benefits of reducing exposure to lead by males per pathway (UJSS)

(I + P +W)

Soil 335,022

Water 111,674

Air 446,696

Food 223,348

'0 98 Selting Priorities for Environm7ental Management: Mining in Bolivia

Table W.9 Annual and present values of reducing soil lead exposure of adult males in Sol (US$ present value, discount rate = 10 percent)

Aniual benief'itsof reducing casesof Aninlualbcnefits of reducing Aninlualbcnelits ol' reducing inicidence of hypertenlsionI casesof non-fatal heart attaicks premature imiortality

1998 15,158 268 319,595 1999 15,158 268 319,595 20(X) 15,158 268 319,595 20)1 15,158 268 319,595 2(0)2 15.158 268 319.595 2(X)3 15.158 268 319,595 2(X)4 15,158 268 319,595 2(X)5 15.158 268 319,595 20()6 15,158 268 319.595 2(X)7 15,158 268 319,595 2(X)8 15,158 268 319,595 2009 15,158 268 319.595 2010 15,158 268 319,595 2011 15,158 268 319,595 2012 15,158 268 319,595 2013 15,158 268 319,595 2014 15,158 268 319,595 2(015 15,158 268 319,595 20)1( 15.158 268 319,595 2017 15,158 268 319,595 2018 15,158 268 319,595 2019 15,158 268 319.595 2(020) 15.158 268 319.595 2021 15,158 268 319.595 2(022 15,158 268 319,595 2023 15,158 268 319,595 2024 15.158 268 319,595 2025 15,158 268 319,595 2026 15,158 268 319,595 2027 15,158 268 319,595 21028 15.158 268 319.595 20)29 15,158 268 319.595 20)30 15,158 268 319,595 2(031 15.158 268 319,595 2032 15,158 268 319,595 2(033 15,158 268 319,595 2(034 15,158 268 319,595 2035 15,158 268 319,595 2(036 15,158 268 319.595 2037 15,158 268 319,595 2(038 15,158 268 319,595 2039 15,158 268 319,595 2040) 15,158 268 319,595 2041 15,158 268 319.595 2(042 15.158 268 319.595 2(043 15,158 268 319.595 2()44 15,158 268 319.595 21)45 15,158 268 319,595 21146 15,158 268 319,595 2(147 15,158 268 319,595 2(048 15,158 268 319,595

Presentvalue 150,4(08 2,660 3,171,203 4 Designing a Program to Reducing Health Damage from Exposure to Arsenic

STEPS REQUIRED

The steps required for designing a program to reduce health damage from arsenic are similar to those for lead. However, the health impacts of arsenic exposure are much less well understood than for lead. There do not currently exist reliable dose-response functions which link exposures to health damage as for lead. Thus, it is not possible to quantify benefits of reducing arsenic exposures at this time. It should be noted that arsenic is not known to damage human health at levels likely to be found in the ambient environment of the mining region of Bolivia. except near point sources such as smelters. Recent studies strongly suggest that no health damage occurs with arsenic exposure until persons are exposed to a threshold level. The lowest dose for which arsenic effects of any kind have been found is about 100 micrograms per liter in drinking water (Wildavsky. 1995). The objective of a program to reduce exposure to arsenic would be to reduce body-burdens of arsenic at reasonable cost. A program which reduces exposure to lead would also reduce exposure to arsenic, cadmium and other heavy metals, so joint benefits would be generated with a lead-reduction program.

Collect data on arsenic in urine or hair

Information on levels of arsenic in urine or hair would indicate whether inhabitants are being exposed to levels of arsenic high enough to cause concern.

Identify the pathways of exposure

Persons may be exposed to arsenic through drinking water, air, soil or dust, and food. In most places, the most important pathway is drinking water: in regions with special geochemical properties, background levels of arsenic in surface or groundwater may be high enough to damage health, when this water is used for drinking. Air may be an important pathway near smelters. Children may receive significant exposure through ingesting contaminated soil and dust. Other pathways include crops grown on arsenic-contaminated soil, fish from arsenic- contaminated water, and airborne-dust from tailings piles and roads. Table W. 10 lists the key pathways and critical and background levels for arsenic.

99 100 Setling Priorities for Environmental Management. Mining in Bolivia

Table W.10 Pathways of exposure with critical and background levels: Arsenic

Drinking water Air SSol crops Fish

critical background critical backgrotind critical background critical background critical background

Arsenic 200 <10Ot/gl 750 1-10 500 pg/g 40 sg/g 40 pg/g I 1.g/g n.a. n.a. jig/l fig/mlnig/mi dry dry weight dry dry weight Wciglht weiglht

pg is microgrami;I is liter: g is gram: ng is naniogramil:n a. is not available. Noie: Critical levels are levels considered potentially dangerous to human health. Souri-ce: World Health Orgailization Regionial Office for Europe 1987; Hutchinisoniand Meema 1987.

Identify the major sources and estimate the relative importance of each

Important sources of arsenic include smelters, mine waste, and natural sources. A program to reduce health damage from arsenic exposure should consider first the costs and feasibility of reducing exposure from the most important sources.

Table W.11 Data needed to develop a program to reduce exposure to arsenic

Data required Collection method

Arsenic levels in urine or hair Urine or hair sampling

Arsenic levels in drinking water, air, soil, crops, and fish Environmental sampling

Sources of arsenic contamination Variations in arsenic levels in urine or hair levels by residential or school district may give clues to major sources of exposure. Information about emissions to air from smelters would be valuable.

Identify actions to reduce exposure

Actions for reducing arsenic exposure depend upon its source. If the major source is a smelter, emissions controls will be needed. If the key source is naturally-contaminated drinking water, the only way to reduce exposure would be to develop alternative supplies of drinking water. If arsenic-contaminated airborne dust is a major source, then remediating mine waste may help. Preferred actions are those which achieve the largest reduction in arsenic exposure for the available funds. Workbook 101

Table W.12 Possible actions to reduce exposure to arsenic

Action Cost ('onments

Mine waste reniediation

Capping, sealiig, or revegetatinig Mcdium Would reduce a source of airborne arsenic. Would also reducc thc likelihood tailings piles children ingest arsenic throughi soil or dust.

Pave in-towniroads TBD Would control a soLurceof airborne arsenic. along witl lead and cadmitim.

Channel and treat acid rock drainage Medium Would reduce the risk of arsenic contaminating drink-ig water supplics at thic source. Would provide little immediate impact on water quality.

Reduce emissions from smelters Higih Older plants nay need expensive retrofitting. Some beniefits may be achieved by upgrading production technology.

Other actions

Encourage hanid washing Low Effectiveness depends on the willingniess of the family to accept thlis approach. and on the availability of clean water.

Install window coverings in homes Low Effectiveness depends on participation of the family.

Fence offcontaminated areas. Prohibit the Low Etfectiveness depends on williiginess of inhabitants to obey prohibitionls growinig of crops on contaminated soils

TBD is to be determined.

101 5 Designing a Program to Reduce Damage to Infrastructure and Ecosystems Due to Acid Rock Drainage

STEPS REQUIRED

In many mining communities in Western Bolivia very low-pH waters (acid rock drainage) pumped from mines and percolating through tailings piles corrodes underground piping and building foundations, and contaminates shallow aquifers and surface waters. Developing a program for reducing this damage requires (a) identifying the sources of acid rock drainage, (b) estimating the relative contribution of each source to the total load, and (c) calculating the costs and the benefits of remediating individual sources.

The environmental audits that have been completed for Sol, Luna, and Tierra have identified sources of acid rock drainage and their relative importance for those mine sites. This information will be collected for other mine sites as they undergo environmental audits.

Identify actions for reducing acid rock drainage

There are many actions for reducing acid rock drainage which vary in cost and efficacy, and have different requirements for long-term operation and maintenance. Many of the actions are experimental; knowledge is growing rapidly about which approaches work best in particular conditions. Table W. 13 contains a partial list of actions for reducing acid rock drainage.

Table W.13 Possible actions for reducing acid rock drainage

Action Cost Conmnents

Channel and treat drainage Medium to high depending on Often a cost-effective approach for reducing amouLitof acid rock drainage from mine treatment approach affecting iifrastructure and ecosystems, dependinlg on treatmenit methiod.

Plugging adits, flooding TBD Success of this approach depends on geology, the minieworkings. mine interrelationships of surface and grouLidwaterreghimes. Plugginigone adit stops one controllable source, however the water may emerge elsewhere in unconitrollableseeps.

Revegetate tailings piles Mediumi Can be cost-ef'fective and part of a public works prqject. requires source of topsoil; success depends on climaticvariables suLcias raiifall, altitude, growing season, is possible to use land ibr maniy purposes if revegetated.

Cap tailings pile with low- Medium Can be problematic lor large covers. permeability dry cover

TBD is to be deterinied

102 Workhook 103

Data needs

Data are needed to estimate the benefits of reducing acid mine drainage and the costs of particular actions. Table W.14 shows the data needed to estimate the benefits of channeling and treating acid rock drainage in Sol.

Table W.14 Data required to estimate benefits of reducing acid rock drainage in Sol

Recommended Investments Benefits

Expected savings from extending the lifetime of the Estimates from persons expert in appraising the water delivery system. capital costs of water and sanitation systems.

Savings on operation and maintenance costs for Estinates from persons expert in appraising the underground piping systems. operation and maintenance costs of water and sanitation systems.

Savings on building material and repair costs. Estimates from persons expert in appraising the costs of building repairs.

The amount adults would be willing to pay each This data would be collected using contingent year to avoid contamination of the deep aquifers. valuation survey techniques.

The amount adults would be willing to pay each This data would be collected using contingent year to protect the ecosystem of Lake Crist6bal. valuation survey techniques.

BENEFIT-COST ANALYSIS: CALCULATING THE PRESENT VALUE OF ACTIONS TO REDUCE DAMAGE TO INFRASTRUCTURE AND ECOSYSTEMS

Channeling and treating acid rock drainage in Sol

In Sol, uncontrolled acid rock drainage pumped from the Javiar mine accounts for over 80 percent of the acid water released into the environment in the city. Low-pH water, can corrode underground piping, and weaken building foundations constructed of carbonate material. Acid waters for the mine may also be responsible for some contamination of the region's shallow aquifers and the Lake Crist6bal ecosystem. Channeling and treating the acid rock drainage - which has an average pH of about 2 - would likely reduce this damage. The benefits would be based on (a) the incremental increase in the lifetime of the drinking water and sewerage systems, (b) a reduction in building repair costs, (c) willingness to pay to reduce the risk of contamination of deep aquifers, (d) willingness to pay to restore the fisheries and improve the amenity value of Lake Crist6bal. (The acid rock drainage may also be contaminating surface water sources which persons living downstream may be using for drinking or irrigation. However no attempt is made to measure these.)

103 104 Setting Priorities for Environmental Management: Mining in Bolivia

Estimating the benefits

1. Extending the lifetime of valves,.fittings. pumps, and man-holes,for water and sewerage system. A large immediate benefit from a program to channel and treat acid rock drainage would be to the underground piping system. Exposure to acid water with a pH of 2 rapidly corrodes piping of zinc, concrete, iron, or copper, and can reduce the system lifetime by as much as one- half (by 10 years for a system with a typical twenty-year design lifetime). In Sol, the piping should be replaced by an acid-resistant material, such as PVC or fiberglass, even if the acid rock drainage from the mine is collected and treated, since there are other sources of acid waters in the area. The benefits of the channelization program would thus be mainly to the valves, fittings, and pumps (many types of which cannot yet be produced of acid-resistant material in high quality), the man-holes, and the underground structural supports.

There are no data currently available regarding the costs of water and sewerage components in Sol, so it is not currently possible to carry out a full cost-benefit analysis for this activity for this site. However, the approach can be illustrated as follows using plausible figures.

Assume material and labor to install valves, pumps, fittings, and manholes costs US$1 million. Without the project, the system would be expected to last only 10 years before needing substantial maintenance or replacement. However, with the project, the system lasts for 18 years (exposure to acidic waters from other sources shortens the lifetime of the system below its design lifetime of 20 years). The channelization and treatment program is a permanent solution, so the benefits continue many years into the future. The present value of the project over a period of 53 years (the valves and fittings are replaced 3 times with the project instead of 5 without the project) would save US$404,083 in maintenance and replacement costs (see Table W. 15).

2. Savings on operation and maintenance costs for underground piping. Operation and maintenance costs would also be lower with the project than without the project. Exposure to acid waters causes leaks and water losses in the years prior to replacement, leading to higher pumping and water treatment costs and repair costs for leaks. Assuming that operation and repair costs for the underground piping system are US$5,000 each year for a 5-year period prior to replacement both with and without the project, but that these expenses are incurred less frequently with the project than without over a period of 53 years (See Table W.15). The net present value of the savings would be US$13,568 over this period.

3. Savings on building material and repair costs. The benefits for savings on building material and repair costs are calculated in the same way as the benefits for extending the lifetime of the water and sewerage system. However, it is assumed that buildings are repaired each year, rather than being replaced at discrete intervals. Assume that there are 10,000 buildings in Sol, and that each building requires US$5 to repair each year. Without the project, the total annual cost of repairing buildings would thus be US$50,000. If the project reduces repair costs by 80 Workbook 105 percent, costs would fall to US$l0,000 per year. The present value of the savings would be about US$397,673 over a period of 53 years.

4. Reduced risk to the deep aquifers. Acid drainage may be contaminating the shallow aquifers of Sol and its environs. There is a risk that acid drainage will eventually contaminate the deep aquifers, possibly irreversibly. The benefits of a project reducing this risk would be the willingness of the inhabitants of the region to pay to avoid long-term damage to an important water resource. If each adult were willing to pay US$. 10 per year to avoid this risk, recognizing that the costs of developing an alternative source of drinking water in the future would be high, then the present value from this activity would be US$99,418 (there are about 100,000 persons over the age of 20 in the region of Sol).

5. Restored fisheries and amenity values of Lake Crist6bal. Acid waters emanating from mines in the watershed have contaminated the ecosystem of Lake Crist6bal. Low-pH water has killed most of the fish in the lake, destroying a source of protein for lake dwellers, most of whom have gradually dispersed. Restoring the ecosystem of the lake would require a long-range program! addressing sources throughout the water basin. Assuming that (a) acid rock drainage from Javiar mine in Sol is responsible for 10 percent of the total acid water draining into the lake, (b) each adult of the region is willing to pay US$.05 per year to remediate this source, and (c) the number of adults is 100.000, then the present value of this activity would be US$49,709.

Total benefits

Total benefits for channeling and treating the acid rock drainage from Javiar in Sol would be about US$964,500, using these assumptions. This does not include possible benefits to those living downstream who use the water for drinking or irrigation.

Summary of possible benefits of channeling and treating acid rock drainage in Sol

Benefit Category Present Value (USS)

Reducedrepair costs for pipingcomponents 404,083 Reducedoperation and maintenancecosts for undergroundpiping systems 13,568 Reducedrepair costs for buildings 397,673 Reducedrisk to deep aquifers 99,418 Reduceddamage to Crist6baiecosystem 49,709 Total 964,451

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o:C V)U ON ' 0 6 Remediating Mine Sites to Attract Private Investment

It is important that Bolivia attract private investment to the mining sector which will help to revitalize and modernize the sector and lead to improved environmental management of individual mines. An important benefit to Bolivia from remediation activities on COMIBOL mining sites would be to remove impediments to private investment in COMIBOL mines, including through the Capitalization Program.

However, it is important that any agreements to remediate past contamination be very carefully considered, to ensure that remediation funds are used in the best possible way. Before COMIBOL commits to remediating past contamination, it should be sure that legal remedies would not be sufficient to alleviate concerns about liability for past contamination by potential private investors. Legal protections, such as indemnifications, will often satisfy potential private investors concerned about their exposure to liability for activities that preceded their presence. This approach also permits governments to retain control of the extent and timing of remediation.

In cases where legal remedies are not sufficient to alleviate concerns of private investors, COMIBOL should agree to remediation measures only after the sources of damage have been clearly identified, delineated, and quantified, and it is fairly certain that activities to eliminate risk to private investors will be effective. At many mine sites, especially those that have been operating for many years, it is often extremely difficult (or impossible) to distinguish damage due to old mining activities and damage due to new activities. Nor may it be possible to distinguish between flows from one mine and flows from another when both are in the same drainage basin. Comprehensive studies modeling the hydrology and assessing the toxicology of the mine site would be required before COMIBOL commits to remediation activities.

Finally, COMIBOL must be sure that it can indeed carryout the remediation measures more cost- effectively than the private investor. Private investors often prefer to conduct their own clean-up activities, which they carry out to meet their specific needs and standards. The costs of clean-up will be capitalized into the price of the mine in these circumstances. However, this reduction in price may be less than the costs COMIBOL incurs should it carry out the clean-up instead.

107 7 Financial Incentives for Cleaning Up the Environment while Remining Old Tailings and Waste Rock

All COMIBOL mining sites contain large quantities of tailings and waste rock from old milling and mining operations. Much of this material may now be profitably re-mined due to the development in the past decade of heap-leaching or batch leaching techniques which allow operators to extract metals from relatively low-grade ores. In Bolivia, such operations are currently underway in Potosi, Sol, and Cielo.

The remining old tailings and waste rock provides an opportunity to clean-up the environment, in addition to providing revenues. The material must be moved and treated, so modern environmental standards can be applied in handling and disposing of the waste once it passes through the leaching process.

However, not all old waste piles are of sufficiently high quality to be profitably re-mined. Still they may produce enough revenue to offset at least some of the costs of cleaning up the environment. Where this is the case, it may be economically efficient for COMIBOL to offer private entrepreneurs financial incentives to re-mine the waste material, such as subsidies. The financial incentives should not exceed the present value of the benefits of environmental remediation, calculated in the normal way.

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GASTER9CA H7S IT PA N ' 0 I AMHH,, RECENT WORLD BANK TECHNICAL PAPERS (continued)

No. 361 Laporte and Ringold. Trendsin EducationAccess and Financingduring the Transitionin Centraland EasternEurope. No. 362 Foley,Floor, Madon, Lawali, Montagne, and Tounao, The Niger HouseholdEnergy Project: Promoting Rural Fuelwood Markets and VillageManagement of NaturalWoodlands No. 364 Josling, AgriculturalTrade Policies in the Andean Group:Issues and Options No. 365 Pratt, Le Gall, and de Haan, Investing in Pastoralism:Sustainable Natural ResourceUse in Arid Africaand the MiddleEast No. 366 Carvalho and White, Combiningthe Quantitativeand QualitativeApproaches to PovertyMeasurement and Analysis: The Practiceand the Potential No. 367 Colletta and Reinhold, Review of EarlyChildhwod Policy and Programsin Sub-SaharanAfrica No. 368 Pohl, Anderson, Claessens, and Djankov, Privatizationand Restructuringin Centraland EasternEurope: Evidence and PolicyOptions No. 369 Costa-Pierce, FromFarmers to Fishers:Developing Reservoir Aquaculturefor People Displaced by Dams No. 370 Dejene, Shishira, Yanda, and Johnsen, LandDegradation in Tanzania:Perceptionfrom the Village No. 371 Essama-Nssah, Analyse d'une ripartitiondu niveaude vie No. 372 Cleaver and Schreiber, Inverserla spriale:Les interactionsentre la population,I'agriculture et l'environnementen Afrique subsaharienne No. 373 Onursal and Gautam, VehicularAir Pollution:Experiencesfrom Seuen Latin AmericanUrban Centers No. 374 Jones, SectorInvestment Programs in Africa:Issues and Experiences No. 375 Francis, Milimo, Njobvo, and Tembo, Listeningto Farmers:Participatory Assessment of PolicyReform in Zambia's AgricultureSector No. 376 Tsunokawa and Hoban, Roadsand the Environment:A Handbook No. 377 Walsh and Shah, Clean Fuelsfor Asia:Technical Optionsfor Moving towardUnleaded Gasoline and Low-SulfurDiesel No. 378 Shah and Nagpal, eds., UrbanAir Quality ManagementStrategy in Asia: KathmanduValley Report No. 379 Shah and Nagpal, eds., UrbanAir Quality ManagementStrategy in Asia:Jakarta Report No. 380 Shah and Nagpal, eds., UrbanAir Quality ManagementStrategy in Asia:Metro Manila Report No. 381 Shah and Nagpal, eds., UrbanAir QualityManagement Strategy in Asia: GreaterMumbai Report No. 382 Barker, Tenenbaum, and Woolf,Governance and Regulationof PowerPools and System Operators:An International Comparisonz No. 383 Goldman, Ergas, Ralph, and Felker,Technology Institutions and Policies:Their Rolein DevelopingTechnological Capability in Industry No. 384 Kojima and Okada, CatchinigUp to Leadership:The Roleof TechnologySupport Institutionsin Japan'sCasting Sector No. 385 Rowat, Lubrano, and Porrata, CompetitionPolicy and MERCOSUR No. 386 Dinar and Subramanian, WaterPricing Experiences: An InternationalPerspective No. 387 Oskarsson, Berglund, Seling, Snellman, Stenback, and Fritz, A Planner'sGuidefor SelectingClean-Coal Techinologiesfor PowerPlants No. 388 Sanjayan, Shen, and Jansen, Experienceswith Integrated-ConservationDevelopment Projects in Asia No. 390 Foster, Lawrence, and Morris, Groundwaterin UrbanDevelopment: Assessing ManagementNeeds and FormulatingPolicy Strategies No. 392 Felker,Chaudhuri, Gyorgy, and Goldman, The PharmaceuticalIndustry in Indiaand Hungary: Policies,Insititutions, and TechnologicalDevelopment No. 393 Mohan, ed., Bibliographyof Publications:Africa Region,1990-97 No. 394 Hill and Shields, IncentivesforJoint ForestManagement in India:Analytical Methods and CaseStudies No. 395 Saleth and Dinar, Satisfying UrbanThirst: Water Supply Augmentationand PricingPolicy in HyderabadCity, India No. 396 Kikeri, Privatizationand Labor:What Happens to WorkersWhen GovernmentsDivest? No. 397 Lovei, PhasingOut LeadfromGasoline: Worldwide Experience and PolicyImplications No. 399 Kerf, Gray, Irwin, Levesque, Taylor,and Klein, ConcessionsforInfrastructure: A Guide to Their Designand Award No. 401 Benson and Clay, The Impactof Droughton Sub-SaharanAfrican Economies:A PreliminaryExamination No. 402 Dinar, Mendelsohn, Evenson, Parikh, Sanghi, Kumar, McKinsey,and Lonergan, Measuringthe Impactof ClimateChange on IndianAgriculture No. 403 Welchand Fremond, The Case-by-CaseApproach to Privatization:Techniques and Examples THE WORLD BANK

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