Commercial Nickel Processing Plant, Long Harbour, Placentia Bay

Canadian Environmental Assessment Act Screening Report

Submitted by: Fisheries and Oceans Canada Transport Canada

June 2008

FISHERIES AND OCEANS CANADIAN ENVIRONMENTAL ASSESSMENT ACT (CEAA) SCREENING REPORT

GENERAL INFORMATION 1. EA Title: Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 2 Proponent: Vale Inco Newfoundland and Labrador Limited, Suite 700, Baine Johnston Centre, 10 Fort William Place, St. John’s NL A1C 1K4; President – Robert Cooper; EA Contact – Ms. Brenda Brown, Environment, Health and Safety.

3. Other Contacts (Other Proponent, Consultant or Contractor): 4. Role: AMEC Earth & Environmental Limited AMEC Earth and Environmental Ltd. collected baseline 133 Crosbie Road, Suite 202 information on the freshwater environment including St. John’s, NL A1B 1H3 surface water, groundwater and sediment quality, benthic invertebrate and fish quality, and classification of fish aquatic habitat. LGL Limited LGL Limited was retained by the proponent to conduct 388 Kenmount Road a review of information and to provide marine St. John’s NL A1B 4A5 environmental baseline information on sea water, marine sediment, and marine biota (i.e., fish and fish

habitat) in Long Harbour.

Canning & Pitt Associates, Inc. Canning & Pitt Associates, Inc. was retained by the PO Box 21461 proponent to provide a review of the commercial St. John's, NL A1A 5G2 environment in the Placentia Bay area including the historical context, species harvested, the monthly distribution of fishing activities, fishing gears used, and Erik Devuyst Consultant Inc. the geographic location of fishing activities. 232 Glover Road Dr. Erik Devuyst provided information on the residue Stoney Creek, ON L8E 5H7 storage options for the hydromet plant. 5. Source: The Canadian Environmental Assessment Agency (the Agency) and the Newfoundland and Labrador Department of Environment and Conservation (NLDOEC), Environmental Assessment Division, referred the proposed Commercial Nickel Processing Plant registration information to the Department of Fisheries and Oceans (DFO) and Transport Canada (TC) on March 17, 2006 and March 23, 2006 respectively. The Agency requested that DFO and TC review the information and indicate whether they were likely to be responsible authorities or expert federal authorities as per the Canadian Environmental Assessment Act (CEAA). The NLDOEC requested that DFO and TC review the information with respect to their particular departmental responsibilities and indicate whether an environmental assessment was required as per Section X of the Newfoundland and Labrador Environmental Protection Act. DFO advised that an environmental assessment of the project, as prescribed by CEAA, was required prior to issuance of a Fisheries Act Section 35(2) Authorization and recommendation of the scheduling of the waterbody as a Tailings Impoundment Area (TIA) under the Metal Mining Effluent Regulations (MMER). TC advised that an environmental assessment of the project, as prescribed by CEAA, was required prior to issuance of a Formal Approval pursuant to Paragraph 5(1)(a) of the Navigable Waters Protection Act and the potential issuance of a waterlot lease for the purposes of enabling the project. The Province required an Environmental Impact Statement as per the Newfoundland and Labrador Environmental Protection Act.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 1 6. EA Start Date: November 3, 2006 7. CEAR No.: 06-01-23173 8. PATH No.: 06-HNFL-NA2-000-000008 9. DFO File No: BAB 3970-19 10. TC File No.: ES NL 2006-056 11. NWPA File No.: 8200-06-1097 12. Provincial/Territorial File No.: Reg. #1243

BACKGROUND

13. Background about Proposed Development (including a description of the proposed development): The Voisey’s Bay Development Agreement signed in 2002 between the proponent and the Province of Newfoundland and Labrador requires the establishment of a commercial nickel concentrate processing plant in Newfoundland and Labrador using hydrometallurgical technology, provided that this technology can be shown to be technically and economically feasible. The hydrometallurgical technology (Hydromet Plant) will process nickel concentrate into a finished nickel product. A Demonstration Plant was constructed in , NL in 2005 to establish the commercial, technical and economic feasibility of hydrometallurgical technology to process the nickel concentrate. If this technology is not feasible, a nickel matte processing facility (Matte Plant) would be constructed to meet the commitment to process nickel in the province. The Matte Plant would process nickel matte from an out-of-province smelter as the input material and produce a finished nickel product. The Agreement stipulates that the technology must be selected (Processing Decision) by November 15, 2008. As such, this Environmental Assessment (EA) for the Long Harbour Commercial Nickel Processing Plant includes both processing options.

Development Proposal Vale Inco Newfoundland and Labrador Limited (Vale Inco NL - the proponent), a subsidiary of Vale Inco Limited, proposes to construct, operate, and eventually decommission a nickel processing plant to produce a finished nickel product and associated copper and cobalt products. The proponent proposes to locate the plant on the south side of Long Harbour, Placentia Bay, NL at approximately 47°25’N and 53°49’W. Some components of the development proposal are proposed for a “brown field” site (Tier 1 Port Site) on the south side of Long Harbour which was previously used as an industrial site from 1969 to 1989, first by the Electric Reduction Company of Canada Industries Limited (ERCO) and then by Albright and Wilson Americas Limited (AWA). The decommissioned site includes a wharf, a paved access road, several buildings (administration, steam, and mud residue buildings), buried service lines, several landfills, a secure hazardous waste disposal area, a slag stockpile and construction debris. Some portions of the site (e.g., the hazardous waste disposal area) are not suitable for development. Other components of the development proposal will be located on a “green field” site (Tier 2 Plant Site) above Long Harbour on the south side (Figure 1.0).

For the Hydromet and Matte Plants, Tier 1 will contain the port facilities which include: • Port facility including a wharf, an area for staging and storing of equipment and containers, and storage facilities for raw materials, reagents, wastes, and finished products; • Conveyor systems; • Stormwater capture system, sewage treatment system and general port buildings; • Underwater discharge pipe into a diffuser in Long Harbour; and • Port operations office, lunch room and change house. For the Hydromet Plant, Tier 1 will also include a lime kiln to convert limestone into lime for effluent neutralization, Sulphuric acid storage tank(s), fuel storage tanks, concentrate and limestone grinding process building. For the Matte Plant, the lime kiln and fuel tanks would be located on Tier 2.

For the Hydromet and Matte Plants, Tier 2 will contain plant Site facilities which include: • Lime kiln to convert limestone into lime to be used for effluent neutralization (Matte Plant); • Processing complex where the feed (concentrate or matte) is pressure leached in acid solution to separate

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 2 iron and sulphur from nickel, copper and cobalt; • Solvent extraction building to extract the nickel, copper and cobalt for refining; • Complex for the refining of nickel, copper and cobalt; • Oxygen plant; • Boiler plant to provide steam for heating; • Cooling tower to cool and recycle cooling, and some process water; • Diesel and No. 2 fuel oil storage tanks; • Electrical substation; • Administration, change house, warehouse, workshops and utility buildings; and • Control room and analytical laboratory.

Other components of the facility are beyond these primary sites and include: • Water supply system including a water control structure at Rattling Brook Big Pond and pipeline to the plant; • Residue storage area (Sandy Pond for underwater storage of combined residues for the Hydromet Plant, or an aboveground (sub-aerial) storage area for residue storage for the Matte Plant); • Pipelines to and from the residue storage area; • Pipelines to carry concentrate slurry, sulphuric acid, and lime and limestone slurries from Tier 1 to Tier 2 (Hydromet only); • Access roads (between Tiers 1 and 2, between Tier 2 and the residue storage area and Rattling Brook Big Pond); • Power lines between the substation and the sites; • Pipelines and pipe racks between Tier 1 and Tier 2; • Other site infrastructure including parking, water storage tank and pump houses, water distribution system, effluent treatment plant, sewage treatment plant, surface water drainage system, power distribution equipment, security fencing and access control building; • Constructed storm-water pond and effluent discharge polishing/cooling ponds; and • Standby diesel generators.

Construction at the site for the Hydromet and Matte Plant options would include the repair and expansion of the existing wharf to accommodate a single 32,000 DWT vessel with additional berthing for smaller support vessels. Shipping is estimated to be 25 vessels per year. Dredging of approximately 26,600 cubic metres of sediment at the wharf site will occur. A 3-kilometre road would be constructed from the wharf to connect the main plant preparation and processing buildings. Existing roads would be upgraded and extended as necessary. There will be three road crossings of Rattling Brook, one a multi-plate bottomless arch and two culvert installations. A 2-kilometre pipeline would be constructed to obtain process water from Rattling Brook Big Pond. Other activities would include the construction of processing facilities, sewage treatment facilities, administrative offices and laboratories. Runoff from the Plant Site will be collected in storm-water ponds on each Tier.

The Hydromet Plant option would process approximately 269,000 tonnes per year (t/y) of nickel concentrate to produce 50,000 tonnes per year (t/y) of nickel, 3,710 t/y of copper, and 2,450 t/y of cobalt. The Hydromet plant would require 65 hectares with an additional 85 hectares required for the pipeline and residue ponds to the northeast of the plant. The Hydromet proposal includes the construction of a 3.8 kilometre pipeline to Sandy Pond for the disposal of 375,000 t/y (dry basis) of neutralized slurry residue and to return clarified water to the processing facility; and the construction of three dams on Sandy Pond to contain the residue. The dams will be designed so that they can be raised to increase capacity. Decant water will be pumped back to the Plant Site on Tier 2, where excess water will be treated and discharged into Long Harbour via a 6 km sub-sea pipeline.

The Matte Plant option would process approximately 92,000 t/y of nickel bearing matte to produce 50,000 t/y of

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 3 nickel, up to 420 t/y of cobalt, and 15,000 t/y of copper in the form of copper sulphide cake. The Matte Plant would require 65 hectares with an additional 40 hectares required for the sub-aerial disposal of the gypsum residue from the refinery. Waste gypsum slurry (175,000 t/y (dry basis)) would be transported 2 kilometres by pipeline to a storage site approximately 1.3 km southwest of the plant surrounded by a 4 metre high containment berm. Excess water (run-off and leachate) would be collected in an adjacent clarification pond, from which the effluent would be carried by a return pipeline back to the Plant, with excess water treated and discharged into Long Harbour. A portion of the watershed may need to be redirected away from the storage site.

Process water will be obtained directly from Rattling Brook Big Pond, located about 2 km southeast of the site. A pump house and a pipeline will be constructed to pump water to the Plant, which will be at approximately the same elevation as the pond. A flow control structure will be constructed on Rattling Brook Big Pond to provide flows to maintain fish habitat in Rattling Brook. The Hydromet Plant will require about 4.4 million m3 of water per year. The Matte Plant would require about 2.5 million m3 of water per year.

Treated effluents totaling approximately 7.2 million cubic metres per year are proposed to be discharged to the marine environment from the Hydromet Plant. The Matte Plant would discharge approximately 2.6 million cubic metres of treated effluent. A high-density polyethylene (HDPE) effluent discharge pipeline from the Plant Site will extend approximately 6 km underwater to a diffuser located east of Shag Rocks in Long Harbour. Electrical power (a connected load of approximately 94 MW for Hydromet and approximately 74 MW for Matte) will be obtained from the provincial grid.

The construction phase of the development will begin once all necessary permits and approvals are obtained. Construction is scheduled to be complete by 2011. Current plans are to decommission the facility at the end of the planned 15-year operating life, such that decommissioning will commence in 2026. Decommissioning will include rehabilitation of the areas disturbed by the Project, and is anticipated to take approximately five years.

Rehabilitation of the Long Harbour commercial nickel processing facility will include: • Removal and appropriate disposal of all hazardous chemicals, reagents and materials; • Drainage and cleaning of process vessels, pipelines and equipment; • Removal and appropriate disposal of all salvageable equipment, materials and supplies; • Removal and appropriate disposal of all non-salvageable equipment, materials and supplies; • Demolition and removal of all above-grade buildings, foundations and other infrastructure (e.g., wharves [except phosphorus encapsulated area], pipelines, power lines, sewage treatment facilities) no longer required once the facility has closed; • Removal and appropriate disposal of all non-hazardous demolition debris; • Assessment of soil, sediment and groundwater contamination in the area of buildings and other facilities, and implementation of appropriate remediation measures to address contaminated areas identified; • Closure of the underwater residue storage area, stabilization of dams, installation of barrier or cap over waste if necessary, treatment of overflow as necessary; • As applicable, closure of aboveground residue storage area; stabilization of dams; installation of cap over waste; treatment of drainage as necessary; • Drainage and closure of storm water and process water ponds; • Removal of fencing, scarification of road surfaces, removal of culverts and stream crossings and restoration of natural drainage patterns wherever practical;

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 4 • Closure of active borrow pits and quarries; • Revegetation, where appropriate, to control erosion; • Long-term monitoring, care and maintenance of the phosphorus encapsulated in the dock; • Potential long-term treatment of effluent from the residue disposal area; and • A monitoring program to determine the effectiveness of the decommissioning.

The construction phase for the Hydromet Plant and Matte Plant will require approximately 5,750 and 4,950 person-years of employment respectively. Operation of the Hydromet Plant and the Matte Plant will require 450 and 400 employees respectively. The entire development proposal is estimated to be valued at 2.2 billion U.S. dollars.

ENVIRONMENTAL ASSESSMENT 14. DFO Trigger(s): 15. Act & Section(s): Law List Fisheries Act Section 35(2) and Section 36(5)(a) to (e) 16. Other RAs: 17. CEAA Trigger(s) of Other RA(s): Transport Canada Law List - Navigable Waters Protection Act Paragraph 5(1)(a) Land - Transport Canada may provide federal lands for the purpose of enabling this project to be carried out. 18. Lead RA: Fisheries and Oceans Canada 19. Other Jurisdiction: Province of Newfoundland and Labrador 20. FEAC: 21. Rationale for FEAC: Fisheries and Oceans Canada As Fisheries and Oceans is the lead responsible authority for the environmental assessment, and no component of the proposal development is on the comprehensive study list, DFO became the FEAC for the assessment.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 5 22. Expert Federal Authorities: 23. Area(s) of Interest of Expert FA(s): Upon referral of information to other federal Environment Canada’s expertise stems from the departments, Environment Canada (EC), department’s administration of several statutes such as the Natural Resources Canada, and Health Canada Department of Environment Act, Fisheries Act (Section were identified as expert federal authorities. 36), Canadian Environmental Protection Act, Species at Risk Act, Canada Water Act, Canada Wildlife Act, and the Migratory Birds Convention Act which are focused on promoting sustainable development, protecting the environment, conserving certain renewable resources and reporting on environmental conditions. EC is also the lead federal department in promoting a variety of federal policies and programs concerning the environment including the Federal Policy on Wetland Conservation, A Wildlife Policy for Canada, the Federal Water Policy, Toxic Substances Management Policy and the federal strategy for pollution prevention.

Natural Resources Canada’s area of expertise relates to Explosives; Management of mine wastes (tailings and overburden), protection of surface water and underground water quality, acid mine drainage; Energy efficiency, new fuels; Geological incidents (earthquakes/seismicity, landslides, flooding, deep water hazard, tsunamis, geomagnetism); Geophysics (shallow terrain and deep crustal); Geosciences (surface and underground geology, geomorphology, underground water,) ; Geotechnics and engineering geology; Groundwater and hydrogeology (flow, recharge, chemistry and aquifer delineation); Marine environmental and marine resource geosciences; Mineral and hydrocarbon geology and regional resource assessments.

Health Canada’s areas of expertise includes: • Air quality health effects • Contamination of country foods (e.g. fish, wild game, garden produce, berries, etc) • Drinking and recreational water quality • Radiation effects • Electric and magnetic fields • Noise impacts • Health risk assessment and risk management, • Federal air, water, and soil quality guidelines/standards used in human health risk assessments; and • Toxicology (multimedia - air, water, soil) Health concerns will be covered in Certificates of Approvals issued by the Province following interaction between Health Canada and the Provincial Department of Health and Community Services.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 6 24. Other Contacts and Responses: Federal Agencies contacted during the environmental assessment of this project include Canadian Environmental Assessment Agency, Transport Canada, Environment Canada, Natural Resources Canada, and Health Canada.

The Provincial Department of Environment and Conservation (Environmental Assessment Division) was also contacted. The development proposal is subject to a provincial environmental assessment in accordance with the Newfoundland and Labrador Environmental Protection Act. The federal environmental assessment has been coordinated, to the extent possible, with the provincial environmental assessment. A document outlining the information that the Proponent must provide in the Environmental Impact Statement (EIS) entitled “Guidelines for both the Environmental Impact Statement (pursuant to Part X of the Environmental Protection Act) and the Federal Environmental Assessment (pursuant to the Canadian Environmental Assessment Act) Long Harbour Commercial Nickel Processing Plant (Placentia Bay, Newfoundland and Labrador).”, was released for public review on September 6, 2006. Information provided by the Proponent (i.e. in the EIS) is used as part of both the provincial environmental assessment process, and the federal environmental assessment process. However, the federal and provincial governments will each make decisions on matters within their own legislative authorities. 25. Scope of Project (details of the project subject to screening): DFO has determined that aspects of the development proposal are likely to result in a Harmful Alteration, Disruption, or Destruction (HADD) to fish habitat and therefore require the issuance of a subsection 35(2) Fisheries Act Authorization. The proposed Tailings Impoundment Area (TIA) [Sandy Pond] will require amendments to the Metal Mining Effluent Regulations (MMER) made pursuant to Section 36(5) of the Fisheries Act and approval by Governor in Council (GIC) in order to list Sandy Pond under Schedule 2 of the MMER as per paragraph 36(5) (a) to (e) of the Fisheries Act.

TC has determined that aspects of the development proposal are likely to result in an interference to navigation and thus require a Formal Approval under Paragraph 5(1)(a) of the Navigable Waters Protection Act. In addition, construction and operation of the wharf expansion in Long Harbour may require a waterlot lease from the Harbours and Ports Branch of Transport Canada as Long Harbour is a federally administered harbour.

As such, consistent with the regulatory mandates of the responsible authorities (RAs), the federal scope of the project in relation to the Commercial Nickel Processing Plant, Long Harbour, Newfoundland and Labrador includes the following (see Appendix A for complete scoping document): • Construction and operation of the wharf expansion (including infilling and dredging); and the outfall in the marine environment; • Construction of the dam and intake in Rattling Brook Big Pond; • Changes in water levels of Rattling Brook Big Pond as a result of water extraction; • Reduction in flow on Rattling Brook as a result of water extraction from Rattling Brook Big Pond; • Construction of dams on Sandy Pond; • Dewatering of Sandy Brook; • Deposition of residue in Sandy Pond; • Infilling of two unnamed ponds (Ponds 24 and 25); • Diversion of a portion of two small streams on a tributary of Rattling Brook; and • Installation of watercourse crossings.

Spatial boundaries of the assessment area varied as they are specific to each factor. The temporal boundaries of the assessment encompass the entire lifespan of the development proposal (expected to be approximately 20 years) including construction, operation, and decommissioning.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 7 26. Factors Considered: The factors considered in this screening, pursuant to Section 16 of CEAA, are the following: • the environmental effects of the project, including the environmental effects of malfunctions or accidents that may occur in connection with the project and any cumulative environmental effects that are likely to result from the project in combination with other projects or activities that have been or will be carried out; • the significance of the environmental effects referred to above; • comments from the public that are received in accordance with this Act and the regulations; • measures that are technically and economically feasible and that would mitigate any significant adverse environmental effects of the project. In addition, because of the requirement for an MMER amendment under the Hydromet Plant option, an analysis of alternatives to deposition of waste residue underwater in Sandy Pond (i.e. alternatives to regulation) is also considered. This includes an analysis of the technical, environmental and socio-economic feasibility associated with underwater deposition/storage options versus land based storage options. 27. Location of Project: The Town of Long Harbour-Mount Arlington Heights is situated on the north side of Long Harbour, Placentia Bay, Newfoundland and Labrador. The Project will be located on the south side of Long Harbour (Topographic Map Argentia 1 N/5) at the approximate coordinates: 47°25’N and 53°49’W. 28. Environment Description: Fish, Fish Habitat and Water Quality Marine Environment The coastline of Placentia Bay is irregular with many bays, inlets, and islands. The Eastern Placentia Bay shoreline running from Little Harbour to Argentia is dominated by rocky headlands, gravel pocket beaches and rock platforms.

Long Harbour is situated on the eastern side of Placentia Bay, east of Merasheen Island and Red Island. The mean water depth in the harbour is approximately 30 m with the exception of a bathymetrical mound in the middle of the area where water depth varies between 13 m and 17 m. At Crawley Island the harbour splits into two branches, St. Croix Bay to the north and the main portion of Long Harbour to the south.

Pack ice that enters the outer part of Placentia Bay rarely occurs north of the Argentia Peninsula. Long Harbour has an ice-free port that can operate year-round, and offers access to major North Atlantic shipping lanes.

Deep Water between Shag Rocks and Crawley Island (area of effluent pipeline) The dominant substrate type in this area consists of soft sediment (silt). Water depths in this area range from 60 to 74 m. Fauna in the soft sediment regions of the candidate outfall area include winter flounder, American plaice, eelpouts (Zoarcidae), bivalves, seastars, brittlestars and small crustaceans (likely amphipods). Occasional boulder clusters are also present. Biota associated with these clusters include sea anemones, sea urchins and sea stars. A rocky hump tops off at approximately 60 m and is completely surrounded by the deeper soft sediment habitat. It is a productive area relative to the surrounding area, and biota include echinoderms (seastars, sunstars, and sea urchins), corals, sea anemones, crabs, and cod.

North Side of Wharf (wharf expansion) The predominant type of substrate in this area consists of hard sediments such as sand, gravel, cobble, and small boulder. Water depths of the area range from 8.5 to 14.5 m. Biota include kelp, areas of low-lying filamentous algae (red, brown, and green algae), cunner, winter flounder, sea stars, sand dollars, mussels, and amphipods. Considerable decomposition (likely kelp) occurs in this area. Close to the wharf, metal scraps and other industrial waste is common. A sunken vessel adjacent to the wharf on the south side will be removed by the Long Harbour Development Corporation in accordance with government regulations prior to Vale Inco NL

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 8 acquiring the site.

Rattling Brook Cove The dominant substrate type consists of hard sediments such as sand, gravel and cobble. Water depth of the surveyed area ranges from 0.2 to 9.1 m. Biota includes low-lying filamentous algae (red, brown, and green algae), coralline algae, eelgrass, and Irish moss in the shallower areas, along with periwinkles, hermit crabs, rock crabs, sea scallops, Icelandic scallops, sea stars, and sand dollars.

Resource Use Three blue mussel aquaculture sites occur within Long Harbour. Two of these are located on the north side of Crawley Island and the other within St. Croix Bay. All three sites are owned and operated by Baie Sea Farms and have been under active development since the late 1980s.

The Placentia Bay fisheries employ both mobile gear (typically towed by a ship) and fixed gear (typically anchored or weighted in place). The fisheries in Placentia Bay are pursued mainly in small (<10.7 m) boats.

There are approximately six fishing enterprises with registered home ports in the Long Harbour-Mount Arlington Heights area. Based on fisher consultations undertaken by the proponent, two enterprises operated longliners (one 13.7 m and one 10.7 m) and the remaining licence holders fished in speedboats (all less than 10.7 m). The largest vessel harvested most of its catch (crab and cod) in offshore fishing locations beyond 3Psc (based out of the port of St. Lawrence), while the other longliner operator fished crab within 3Psc/CFA 10A. The remaining smaller vessels fish a variety of species (cod, herring, mackerel, lobster, squid, blackback flounder and lumpfish) on inshore grounds within Long Harbour, as well as snow crab further out in Placentia Bay. In general, there is little fishing activity within the immediate vicinity of the Port of Long Harbour. In previous years, quantities of squid, herring, lobster and mackerel were harvested close to the existing wharf, on the north and south sides. Fishers report that catches of lobster have decreased significantly in recent years, and very few mackerel or squid are harvested in these waters.

Some harvest of lobster continues on grounds in the vicinity of the Long Harbour wharf. Approximately 15 to 20 pots are set close to the shore adjacent to the previously used industrial site. Fishers report that there is a spawning area for herring in the shallow water in the inner part of Long Harbour between Pierce Cove Point and Bottom Brook Harbour. Herring are also taken by local fishers close to shore on the south side of Long Harbour from Rattling Brook Cove (on the south side of the wharf) out as far as Tim Barrett’s Cove (located on the south side of Long Harbour). The herring fishery generally lasts about two to three weeks. Local fishers, as well as larger vessels from St. Mary’s Bay and other Placentia Bay ports, harvest herring around Crawley Island. These seining activities generally take place during March and April. Cod are harvested using hand-lines and gillnets, though the latter is the preferred gear. Fishers report that no cod are harvested commercially in the immediate area of the community. Gillnetting areas for cod are concentrated between the east end of Crawley Island out to grounds located west of the Iona Islands and in suitable areas to the south as far as Fox Island. Most of these cod fishing activities are located to the west of Shag Rocks, but at least one small-boat fisher prefers to harvest his cod on grounds inside these rocks. Lumpfish are harvested on grounds relatively close to shore near the community of Long Harbour, but also in shallow water to the east of Shag Rocks. One fisher has fished scallops in St. Croix Bay in the past but reports they have not been plentiful during the past eight to 10 years. For the most part, scallops are no longer fished on a commercial basis, although they are still taken occasionally by divers.

An anchorage area (Anchorage “FF”) is established within Long Harbour and is sometimes used by small tankers visiting the Come by Chance Refinery. This anchorage is located in the outer middle portion of Long Harbour, between Shag Rocks and Burke Island/Merchant Island is used for vessels with a draft of less than 12 m. Some local fishers harvest cod and other species within this anchorage location located at 47°24'30"N and

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 9 53°56'18"W.

Residents of the area also engage in recreational marine angling, pursuing mackerel, smelt and cod. The recreational groundfish fishery is permitted only during specified summer and fall months, with a limit of five fish per person per day. In 2007 the season ran from July 25 to August 19 and September 29 to October 7.

Freshwater Environment There are two watersheds directly within the footprint of the project (Rattling Brook, Sandy Brook). If the Matte Plant is constructed, a third watershed (Little Rattling Brook) will be affected (Figure 2.0).

Rattling Brook Watershed The Rattling Brook watershed drains a total area of 38 km2 and its outflow is near the existing Long Harbour Industrial Park and wharf. This watershed contains many large and small ponds with a large network of tributaries. It was used in the past as a source of water for the phosphorus plant owned by Albright and Wilson Americas Limited. Fish species in the Rattling Brook watershed include brook trout, Arctic char and American eel.

The main stem of Rattling Brook (Stream T1) is 3.17 km in length from its mouth at Long Harbour to its origin at Rattling Brook Big Pond with a series of steep rapids at its mouth. It is inaccessible to anadromous salmonids. A 4.5 metre high concrete weir is located approximately 400m upstream from the mouth. Approximately 200 m upstream of the weir are additional falls and rapids. The substrate composition is primarily cobble and larger, up to and including bedrock. Indications of past channelization in the area are evident. Gravels and smaller substrates occur in isolated patches behind larger boulders, however, small areas contain suitable gravels and support brook trout spawning activity. A rock fill dyke on the outflow of Sam Howe’s Pond obstructs fish passage.

Beaver Brook (Stream T1-1) is a tributary to Rattling Brook with heavy riparian vegetation and large woody debris in the upper reaches. Substrate is mainly rubble and boulders with some bedrock. It contains a culvert that crosses the access road to Rattling Brook Big Pond. Beaver Brook contains brook trout.

Several ponds in the watershed could be impacted by the development proposal. Rattling Brook Big Pond (Pond P8) has a total surface area of 189.29 ha and a drainage area of 23 km2. The maximum depth of the pond is 36m and the shoreline consists of boulder, bedrock and rubble. Deeper areas consist of fines and emergent vegetation occurs mainly in shallow area in the northeast end and near the outflow at the western end.

Sam Howe’s Pond (Pond P14) has a total surface area of 38.08 ha and a drainage area of 32.9 km2 (including the outflow from Rattling Brook Big Pond). The maximum depth of the pond is 12.3m and the shoreline consists of boulder and rubble. Deeper areas consists of fines (organic and detritus) with no aquatic vegetation.

Ponds P22 and P23 are small water bodies located at the headwater of Tributary T1-1-1. They have total surface areas of 1.18 and 2.85 ha respectively. Pond 22 has a maximum depth of 0.9 m with substrate dominated by fines (organics and detritus) with gravel, cobble and boulders along the shoreline. The pond has emergent vegetation everywhere muck/detritus is present. Pond 23 has a maximum pond depth of 3.4 m. The pond has a littoral zone comprising fines (organics and detritus) with some larger substrates around the shoreline. The profundal zone is entirely fines (organics and detritus). Emergent vegetation is occurs throughout.

Ponds P24 and P25 are located at the headwaters of Beaver Brook. They have total surface areas of 1.34 and 1.07 ha respectively. Pond P24 has a maximum depth of 1.0 m. The pond is comprised of littoral habitat only with a substrate comprising a majority of fines (organics and detritus) with boulders present along the shoreline.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 10 Emergent vegetation occurs everywhere fine substrate is present. Pond P25 is downstream of Pond P24 with a maximum pond depth of 4.41 m. The pond is comprised of littoral habitat only, with substrate comprising a majority of fines (organics and detritus) and larger boulders around the shoreline. Emergent vegetation occurs throughout the pond.

Pond P30 is on the main stem of Rattling Brook downstream from Sam Howe’s Pond (P14) with a total surface area of 4.22 ha. The maximum pond depth is 3.9 m. The pond is comprised of littoral habitat only, with a substrate comprising a majority of fines (organics and detritus) with boulder, cobble and rubble along the shoreline. Emergent vegetation occurs everywhere fine substrates are present.

The water quality of the Rattling Brook watershed is similar to that of other watersheds in the area, acidic with a pH of less than 7.0. Metals such as aluminum and cadmium show consistently elevated levels while copper, iron, lead, arsenic, and nickel show occasional elevated levels, particularly in summer and fall.

A maintenance and access road originally constructed by ERCO provides access to the watershed from the Long Harbour Industrial Park. This is used extensively by local residents, cabin owners, hunters and anglers to access the area. During surveys conducted in 2006 by the proponent, several boats were stored where the road ends at Rattling Brook Big Pond.

Sandy Brook Watershed Sandy Brook (Stream T2) is located just east of Rattling Brook and drains to the south side of Long Harbour. The watershed extends inland approximately 3.0 km and contains Sandy Pond, Pond P26 and Pond P27. The drainage area of Sandy Brook is approximately 4.8 km2. Fish species in the Sandy Pond watershed include brook trout, American eel and rainbow smelt. American eels were captured in Sandy Brook and Sandy Pond, but not in Ponds P26 or P27. Rainbow smelt were found in Sandy Pond only.

The main stem (Sandy Brook) is 2.36 km between its mouth at Long Harbour and Sandy Pond and has extensive riparian vegetation with large woody debris throughout the upper reaches. The substrate composition is primarily boulders and rubble throughout, with limited gravels and sand in the lower reaches. It is shown as intermittent on 1:50,000 topographic map and the flows appeared to go underground for a total of almost 500m in length (308m and 188m reaches).

There is a small intermittent sub-tributary that drains into the main stem of Sandy Brook approximately 1.5 km upstream from Long Harbour.

Sandy Pond (P15) has a total surface area of 37.83 ha with a maximum depth of 16.5 m. The shoreline comprises a majority of boulders and rubble with the deeper zones comprised of fines (organics and detritus). Emergent vegetation occurs at the eastern end.

Ponds P26 and P27 are small water bodies at the headwater of Sandy Brook just to the northwest of Sandy Pond with surface areas of 4.10 and 1.62 ha respectively. Pond 26 has a maximum depth of 4.32 m. The pond has a shoreline of boulders, rubble, cobble and bedrock. Gravels are present as well as muck/organics. Limited emergent vegetation occurs within the pond. No fish were captured, and therefore it is not considered fish habitat. Pond 27 has a maximum depth of 7.48 m. The shoreline is boulder-cobble. The deeper portion of the littoral zone and the profundal zone is composed primarily of organics and detritus, with limited emergent vegetation. Brook trout is the only species present.

The water quality of the Sandy Brook watershed is similar to that of other watersheds in the area. It is acidic with a pH of less than 7.0. As in the Rattling Brook watershed, there have been elevated levels of some metals identified above CCME Guidelines for the Protection of Freshwater Aquatic Life. In general, aluminum showed

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 11 consistent elevated levels while cadmium, copper, iron, lead, and mercury were occasionally elevated, particularly in spring and summer.

The Sandy Pond watershed is undeveloped with no cabins or roads. An existing trail from Highway 101 to Sandy Pond is used by anglers to access the pond, mostly during the winter season.

Little Rattling Brook Watershed Little Rattling Brook (T3) is located west of Rattling Brook and drains to Ship Harbour with a drainage area of approximately 8.55 km2. The brook is approximately 1.6 km long and has a complete obstruction approximately 500 m upstream from Ship Harbour.

Little Rattling Brook also has a low pH and elevated level of aluminum, cadmium, iron and mercury.

Fish Species Freshwater fish species in the freshwater environment of the development proposal area include brook trout (Salvelinus fontinalis), Arctic char (Salvelinus alpinus), rainbow smelt (Osmerus mordax) and American eel (Anguilla rostrata).

Air Quality Existing air quality conditions in the Region, based on available air quality monitoring data, are described in detail in the Air Dispersion Modeling Assessment (SENES 2007a) and summarized below. There are no known major sources of airborne metals in the vicinity of the Project Area; hence the actual baseline concentrations at the Long Harbour Project site are probably lower than shown.

Representative Background Air Concentrations in the Regional Study Area

Avifauna Newfoundland supports some of the largest seabird colonies in the world and Newfoundland waters host large populations during all seasons. Shorebirds, waterfowl, and raptors (Bald Eagle and Osprey) may be abundant at certain places and times. They are important socially, culturally, economically, aesthetically, ecologically, and scientifically. Seabirds are a key component near the top of the food chain and are an important resource for bird-watching (one of the fastest growing outdoor activities in North America), the tourist industry, local hunting, and scientific study. In addition, they are often sensitive to contaminants in or on water and are of prime concern from a public and a scientific perspective, locally, nationally, and internationally.

Species at Risk Five species (1 bird, 3 fish and 1 lichen species) that are listed on Schedule 1 of the Species At Risk Act (SARA) may be encountered immediately in and adjacent to the Project Area. The Red Crossbill, percna subspecies

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 12 (Loxia curvirostra percna), is listed as an endangered species. The Northern wolffish (Anarhichas denticulatus) and Spotted wolffish (Anarhichas minor) are listed as threatened. The Atlantic Wolffish (Anarhichas lupus) and the Boreal felt lichen (Erioderma pedicellatum) are listed as Species of Special Concern. The American eel is also found in the project area. Although it is not listed under SARA, the Committee on the Status of Endangered Wildlife in Canada (COSEWIC) has designated the American eel as a species of Special Concern.

The Species at Risk Act came into effect June 5, 2003 with the exception of some provisions which came into effect June 1, 2004. For species that were included on Schedule 1 when the SARA came into effect, the competent minister must include a proposed recovery strategy in the public registry within three years for wildlife species listed as endangered species, and within four years for wildlife species listed as threatened or extirpated species. As species are added to Schedule 1, the competent minister must include a proposed recovery strategy in the public registry within one year after the wildlife species is listed for a species listed as an endangered species, and within two years for a wildlife species listed as a threatened or an extirpated species. A recovery strategy is a planning document that identifies what needs to be done to stop or reverse the decline of a species. It sets goals and objectives and identifies the main areas of activities to be undertaken. Detailed planning is done at the action plan stage.

A recovery strategy for the three species of wolfish and a management plan for the Atlantic wolfish is available on the SARA Public Registry: http://www.sararegistry.gc.ca/sar/recovery/recovery_e.cfm While the three wolffish species may occasionally occur in or near the Project Area, they are usually distributed in much deeper water. Northern wolffish is the deepest residing species and Atlantic wolffish is the shallowest. There is little known information on wolffish habitat and therefore critical wolffish habitat has not been specifically defined within the recovery strategy.

A recovery strategy for the Red Crossbill, percna subspecies is also available on the SARA Public Registry. Critical habitat for this bird species is not known due to lack of knowledge regarding its existence, insular distribution, and habitat associations and thus has not been defined with the recovery strategy.

Although the American eel is not listed under SARA, a draft Management Plan has been developed by the Canadian Eel Working Group to coordinate management action among Canadian jurisdictions with responsibilities for conservation and management of American eel. A final version of this Management Plan will be completed based on input received from stakeholders. A more detailed implementation plan will be developed based on the principles and objectives identified in the Management Plan once it is completed.

Other listed species at risk can potentially be encountered in Placentia Bay. These include the Blue whale, Atlantic population (Balaenoptera musculus), North Atlantic right whale (Eubalaena glacialis), Leatherback sea turtle (Dermochelys coriacea), and Piping Plover (Charadrius melodus). These species are listed as endangered on Schedule 1 of SARA. A recovery strategy is available for the Leatherback sea turtle; however critical habitat in Canadian waters is unknown. Newfoundland marten (Martes americana atrata), is listed as threatened under SARA. Species listed as Special Concern that may be encountered include: Fin whale, Atlantic population (Balaenoptera physalu), Barrow’s Goldeneye Eastern population (Bucephala islandica), Harlequin Duck, Eastern population (Histrionicus histrionicus), Peregrine Falcon anatum subspecies (Falco peregrinus anatum), and Ivory Gull (Pagophila eburnean).

Hydrology and Water Resources On average, groundwater is found at about 3.2 m below ground surface throughout the area of the development proposal, and is encountered at depths ranging from surface to approximately nine m. The water table generally mimics the ground surface, except where it discharges into streams, ponds, springs, or the marine environment of Long Harbour. Shallow groundwater generally flows in the same direction as surface runoff, whereas deep groundwater flows more consistently in a northwesterly direction from Sandy Pond towards Long Harbour and

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 13 discharges along its southern shoreline. Surface water quality affects groundwater at this site because of the thin veneer of high conductivity surface material (glacial till) overlying fractured bedrock that transmits groundwater.

Marine Safety and Navigation Normal traffic navigating within Placentia Bay includes very large crude carriers (≤ 350,000 Deadweight Tonnes (DWT)), smaller coastal tankers, chemical tankers, general cargo vessels, container ships, passenger ferries, bulk carriers, tugs, barges, government vessels, fishing vessels, and recreational vessels. Marine safety and navigation within Placentia Bay is governed by the various regulations under the Canada Shipping Act. Vessels operating within Placentia Bay which are greater than 20 m in length (24 m for fishing vessels) must comply with the Eastern Canada Vessels Traffic Services (VTS) Zone Regulations and report their movements to the Marine Communications and Traffic Services (MCTS) center in Argentia. The MCTS center, which is administered by the Canadian Coast Guard (CCG), tracks all vessel movements within Placentia Bay.

In 2006, the Argentia MCTS tracked a total of 7,233 vessel movements within Placentia Bay. The majority of these movements were operational tugs servicing the existing refinery and transshipment facility (1,651), passenger ferries (1,841) and fishing and recreational vessels less than 20m (1,046). In 2006, there were 982 movements of tanker traffic within the bay. MCTS tracks and promulgates marine traffic and management data for the efficient and effective use of Placentia Bay waterways.

The eastern side of Placentia Bay has a Traffic Separation Scheme (TSS) and two-way routing from the entrance of the bay to the boundaries of Come By Chance Harbour. The TSS is made up of an inbound (northbound) lane, a separation zone, and an outbound (southbound) lane (Figure 3.0). Traffic is to avoid crossing lanes, but if necessary, traffic should cross lanes at or near 90°. Other than in emergency situations, the separation zone is not to be entered. Fishing vessels are permitted to fish in the separation zone and the traffic lanes but must not impede the passage of vessels that are required to travel within the designated lanes.

In addition to the TSS, there is a Compulsory Pilotage Area in the northern portion of Placentia Bay. Vessels operating within Compulsory Pilotage Area must engage the services of a licensed pilot as required under the Atlantic Pilotage Authority Regulations, or have a member of the ship crew who holds a valid pilotage certificate. The Compulsory Pilotage Area is bound by a line between St. Croix Point on Merchant Island and Ragged Point on Eastern Head. Vessels bound for Long Harbour will require the services of a certified pilot who will board the vessel just south of Red Island. The Atlantic Pilotage Authority (APA) maintains a record of all assignments performed by pilots within Placentia Bay.

29. Alternatives to the Project/Alternative Means of Conducting the Project that were Considered: Alternatives to the Project The only alternative to the project would be “no project” which was not considered as there would be no economic benefit to Newfoundland and Labrador, to Canada, or to the proponent.

Alternative Means of Conducting the Project Processing Technologies Two alternative processing technologies were considered: pyrometallurgical and bio-leaching. Pyrometallurgical A technical and economic feasibility analysis was conducted using pyrometallurgical technology to produce finished nickel products using Voisey’s Bay nickel concentrate. The analysis concluded that it was not economically viable to construct and operate such a facility based solely on the Voisey's Bay mine/mill production capacity. A pyrometallurgical facility requires more energy to operate than a hydrometallurgical

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 14 facility, and would produce significantly greater quantities of air emissions (sulphur dioxide, particulate matter containing heavy metals, and greenhouse gases) than would a hydrometallurgical process. The pyrometallurgical option was rejected for economic and environmental reasons.

Bio-leaching Bio-leaching is experimental and not commercially proven for nickel recovery. It has only been applied to base metals such as nickel and cobalt at a bench-scale level. Difficulties with metal recovery from the resulting solutions have not yet been economically resolved. Bio-leaching also generates a large quantity of acidic and ferric waste water which must be neutralized, generating large quantities of waste solids with high pH. The quantities of residues and neutralizing agents required would be much larger than for either the Hydromet Plant or the Matte Plant, and the costs of such processes is high. In addition, the commercial feasibility of the bio- leaching process could not be established within the time frame stipulated in the Voisey’s Bay Development Agreement. The bio-leaching alternative was rejected for these reasons.

Site Selection Initially, the proponent had selected Argentia as the preferred site of development of a smelter-refinery complex. However, based on the quantity of nickel to be produced, this type of facility would not have proven to be economical. Hence, the hydrometallurgical processing option was selected as the preferred technology. The change of processing option results in the production of a different type of residue, one that necessitates underwater rather than aboveground storage. As a result of this change, Long Harbour was evaluated and selected as the site for the commercial nickel processing facility.

Residue Storage Alternatives Hydromet Process Residue The Hydromet process for nickel concentrate produces two residues: an autoclave leach and an iron hydroxide gypsum residue. Both residues require neutralization. The Hydromet Plant will process approximately 269,000 t/yr of nickel concentrate resulting in approximately 381,000 t/yr of combined residue, comprising 242,600 t/yr of neutralized leach residue and 138,400 t/yr of neutralized iron hydroxide-gypsum residue. The neutralized leach residue contains about 25 per cent by weight of elemental sulphur, creating a potential for acid generation in the presence of oxygen and water. The other residue is a calcium sulphate material containing most of the iron removed from the processing of the concentrate. It does not contain elemental sulphur and is not subject to acidification or metal remobilization in solution. Combining the two residues takes up about 10 per cent less volume, enhances the stability of both products, and reduces the acid generation potential. Therefore, consideration of storage options is based upon this approach. The combined residue was considered for above- ground (sub-aerial) storage deposited as a slurry or as a paste, and under water (sub-aqueous) storage.

Desirable residue properties for sub-aerial storage include: rapid settling when deposited as a slurry, good filtration properties if deposited as a filter cake, non acid-generating, high strength for traffic-ability, low susceptibility to dusting and minimum need for long term monitoring after closure. Test results on hydromet residue indicate it has poor filterability (residue cannot be stored by dry stacking), it is slow settling if deposited as a slurry (thus requiring a large settling area) and becomes more acid-generating in sub-aerial cycles of wet and dry conditions. The residue can be deposited as a paste, but has a narrow range of pumpable % solids (60% to 63%). As such, the paste plant would need to be located near or at the storage site and would require pumping the residue as a slurry to the paste plant with the excess water being pumped back to the Hydromet plant. The residue is also susceptible to significant dusting upon drying due to the micron size iron-oxide particles in the residue.

The disposal of residue under a water cover represents the most reliable technology for containment of acid-

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 15 generating residue because it limits access of oxygen to the residue. Sub-aqueous disposal can be achieved by pumping the residue in the form of a slurry either to a natural water body (pond), or an artificial containment area in which a water cover can be established and maintained. To be effective a water cover must be sufficiently thick to prevent re-suspension of solids due to pond wave action and seasonal turnover. An accepted engineering standard is to use a minimum water cover of 1m.

Twelve potential disposal sites were selected (seven land-based and five natural water bodies) and assessed using a Multiple Accounts Analysis methodology using criteria grouped into four master categories: environmental, technical, socio-economic, and financial. These sites were designated as sites RS-1 to RS-12 (Figure 4.0). Sites RS-2, 4, 5, 6, 7, 8 and 12 qualify as land based storage sites. However, with the exception of RS-12, these sites do contain minor water bodies which are considered as fish habitat. Complete dry land sites large enough to satisfy the residue storage requirements could not be found, however a potential dry land site could be created by excavating a large volume of material and leveling a sloped area close to the plant (RS-12). Sites RS-1, 3, 9, 10 and 11 qualify as natural water body sites.

Eleven environmental criteria were assessed. These include: ♠ Distance from Plant Site; ♠ Total Watershed Area; ♠ Quantity of Aquatic Habitat Disturbed; ♠ Quality of Aquatic Habitat Disturbed; ♠ Quantity of Terrestrial Habitat Disturbed; ♠ Quality of Terrestrial Habitat Disturbed; ♠ Dam Failure Consequences; ♠ Compensation Effort and Monitoring; ♠ Water Quality; ♠ Post Closure Rehabilitation; and ♠ Dam Reliability.

Six technical and operational criteria include: ♠ Dam Design Details; ♠ Ratio of Dam Volume to Residue Storage Capacity; ♠ Dam, Storage, Quarry and Access Road Footprint; ♠ Construction Risk; ♠ Operational Risk; and ♠ Closure Risks/Uncertainty.

Economic criteria include: ♠ Total capital and operating cost; and

Socio-economic criteria include: ♠ Perceived community response; ♠ Visual impact; and ♠ Resource use and recreation.

Sensitivity analyses comparing different weightings of the four master criteria resulted in Sandy Pond being ranked as the preferred site environmentally and technically. As a result, Sandy Pond was selected as the site for long-term sub-aqueous storage of the combined residues from the Hydromet Plant.

Additional information regarding the alternatives assessment for the Hydromet Residue Storage can be found in:

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 16 Vale Inco. April 2008. Hydromet Plant Residue Storage Options for the Commercial Nickel Processing Plant at Long Harbour, Newfoundland and Labrador.

Matte Process Residue

The Matte process produces a gypsum filter cake that is neutralized and contains little iron. It does not contain elemental sulphur, and there is no requirement to inhibit oxidation. Therefore, it can be stored aboveground in gypsum stacks, either as dry or wet stacking. Dry stacking means that the gypsum is transported and stacked at the same moisture content as the produced filter cake; wet stacking involves pulping the cake with water to form a slurry that can be pumped to a storage area. Because of the wet weather conditions at Long Harbour, the ready availability of water, the ability to transport the slurry via pipeline and the lower costs as compared to dry stacking, the method selected for Matte Process residue storage would be wet stacking. The wet-stack would have a total footprint of about 20 ha enclosed by a 4-m high containment berm and would rise about 30 m above the surrounding terrain.

Effluent Line Routing Two overland routes were evaluated, one along the high-elevation ridge paralleling the shoreline and the other along the shore, near the water’s edge and above the high-tide level. Both overland pipe routes would be more difficult and expensive to construct and maintain than a marine effluent line. Hence, an underwater gravity-fed system was selected.

Dredging Dredging, by either suction or clamshell bucket, is required to provide adequate clearance for the unloading and loading of vessels at low tide. This involves removing a limited depth of sediment down to a bed level of 15 m over an area of approximately 2 ha. A clamshell bucket dredge was selected as the most appropriate method given that the required amount of dredging is limited in volume, the equipment is readily available and the bucket dredge can handle boulders, scrap steel and debris known to be present in the area near the wharf.

30. Other Regulatory Responsibilities The amount of waste residue being deposited into Sandy Pond has triggered Section 22 of the NWPA, which prohibits the deposition of any stone, gravel, earth, cinders, ashes, or other materials into a navigable body of water that is less than 20 fathoms deep. A Governor in Council may exempt any body of water from Section 22 by a proclamation under Section 23 of the NWPA. Although Sections 22 and 23 are not triggers for an environmental assessment pursuant to CEAA, the Governor in Council process will include public consultation and will be coordinated with the EA process.

The Minister of Transport may recommend that a Governor in Council issue a proclamation exempting Sandy Pond from Section 22 of the NWPA if the Minister has no major concerns regarding navigation and is satisfied that the public interest would not be injuriously affected as identified through the Federal Government Regulatory processes. Prior to proclamation, the Navigable Waters Protection Program (NWPP) is responsible to complete a Regulatory Impact Assessment Statement (RIAS) that will evaluate alternatives, benefits and costs, and public concerns. If the proclamation is granted, the only enforcement that the Department of Transport will conduct is the site inspection to ensure that the dams on Sandy Pond are constructed as per the submitted plans and approval under subsection 5(1) of the NWPA.

31. Environmental Effects: Fish, Fish Habitat and Water Quality 1. DFO has determined that the project will result in the harmful alteration, disruption or destruction (HADD)

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 17 of: 2 ¾ 25,589.5 m of productive marine fish habitat associated with the construction of Tier 1 port facilities and marine effluent outfall, ¾ 144.6 Habitat Equivalency Units (1 HEU = 100 m²) of productive riverine fish habitat due to infilling and dewatering associated with the footprint of the Tier 2 facilities (portion of Beaver Brook)and dam on Sandy Pond (Sandy Brook). ¾ 3.6 HEU (1 HEU = 10 000 m²/1 ha) of productive lacustrine habitat due to infilling associated with the construction of Tier 2 facilities (Ponds P24 and P25) and the construction of water control structures (dam’s) on Rattling Brook Big Pond and Sandy Pond.

2. DFO has determined that the project will result in the harmful alteration, disruption or destruction of 18.1 HEU (1 HEU = 10 000 m²/1 ha) of productive lacustrine habitat associated with the utilization of Sandy Pond as a TIA (if the Hydromet option is chosen) which will require amendments to the regulations under the Metal Mining Effluent Regulations (MMER) and approval by GIC in order to list Sandy Pond under Schedule 2 of the MMER as per paragraph 36(5)(a) to (e) of the Fisheries Act.

3. Potential impacts on fish, fish habitat, and water quality in the freshwater environment as a result of increased turbidity and sedimentation from project activities including construction of stream crossings and access roads, fording of streams, site clearing, grubbing, and leveling, etc. Potential impacts on fish, fish habitat, and water quality in the marine environment as a result of grading and leveling on Tier 1 near the shoreline.

4. Dam construction on Rattling Brook Big Pond could result in obstruction to fish passage, changes in water levels on Rattling Brook Big Pond, and reduction of flow on Rattling Brook.

5. Potential for blasting during construction to impact fish in the freshwater and marine environments, particularly fish eggs and larvae.

6. Potential impacts on fish and fish habitat and a decrease in water quality in the marine environment as a result of sedimentation from dredging, wharf expansion, placement of shore and scour protection and installation of marine pipeline.

7. Potential impacts on groundwater quality as a result of seepage from the Tailings Impoundment Area.

8. Wash water (may have high levels of dissolved metals) has the potential to decrease water quality if it enters the marine environment.

9. Potential degradation of water quality as a result of submarine effluent released into Long Harbour.

10. Potential exclusion of fishing activities within the construction safety zone (CSZ) in the marine construction area.

11. Construction materials could enter the waterway during wharf expansion and create a safety hazard for vessels operating near the construction site.

12. Accidental events and malfunctions such as spills of acid, nickel concentrate, lime and limestone, and fuel; and dam failure on Sandy Pond could result in damages to fish and fish habitat and water quality. This could result from spontaneous rupture or explosions or storage tanks, pipeline failure, spills from human error (e.g. overfilling tanks, leaving valves open), etc.

13. Potential cumulative effects with respect to the existing Newfoundland Transshipment Terminal (NTT) at Whiffen Head, the Come by Chance oil refinery, the Shipyard and the Cow Head Steel Fabrication Facility located near Marystown on the , on the west side of Placentia Bay, the Marine Atlantic ferry operating out of Argentia, existing aquaculture sites in Long Habour, the proposed

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 18 LNG Transshipment Terminal at Grassy Point, and the proposed oil refinery at Southern Head.

14. Potential effects of the environment on the project – Wind and waves may cause delays (mostly in regard to marine-related activities such as laying pipe or transporting cargo) or, in extreme cases, by contributing to accidental events. Extreme icing conditions can hamper various operations. High precipitation will affect run-off conditions and open holding ponds.

Air Quality Construction activities such as earthworks, wharf expansion, and vehicle traffic have the potential to generate dust and elevated levels of combustion gases such as NOx. Elevated releases of air contaminants from the operations phase of the Hydromet Plant are predicted for HCl, H2SO4, Mn, Fe, PM10 and NOx while higher concentrations of Co, Ni, Cu and SO2 are anticipated for the Matte Plant. The Hydromet Plant has the potential for a process upset that may result in elevated releases of chlorine. Fugitive emissions from offloading of limestone and nickel concentrate (vessel unloading activity) and road dust emissions from trucking activity during the construction and operation phases are likely.

Avifauna Construction activities such as site grading and leveling, dredging and installation of wharf pilings and the effluent pipeline, have the potential to introduce silt and dust into the marine environment adversely affecting the abundance of fish prey of marine birds and negatively affecting their foraging efficiency. Noise sources in the project area during construction include marine vessels, dredging, pipe-laying vessel, piling installation equipment, and heavy equipment associated with the earthworks. It is likely that some marine birds will be displaced by the visual disturbance and noise. There is little potential for underwater noise to affect marine birds.

Operational activities such as dust from the offloading of limestone and nickel concentrate, the release of washdown water, runoff water, and effluent have the potential to adversely affect the abundance of fish prey of marine birds) and negatively affect their foraging efficiency. The new electrical transmission line and commissioning of the existing transmission line have the potential to cause bird mortality through collision and electrocution. The only bird concentration in the vicinity of the Project is the gathering of Bald Eagles in early spring at the mouth of Rattling Brook and the existing wharf. Bald Eagles may interact with the transmission lines when flying between the herring concentration and roosting, loafing, or nesting areas; however, there are no known corridors of high bird use in the vicinity of the Project.

Potential cumulative effects on marine birds could arise from marine shipping and hunting activities.

Species at Risk As indicated earlier, only five species that are listed on Schedule 1 of the Species At Risk Act (SARA) may be encountered immediately in and adjacent to the project area. The Red Crossbill, percna subspecies (Loxia curvirostra percna), is listed as an endangered species. The Northern wolfish (Anarhichas denticulatus) and Spotted wolfish (Anarhichas minor) are listed as threatened. The Atlantic Wolffish (Anarhichas lupus) and the Boreal felt lichen (Erioderma pedicellatum) are listed as Species of Special Concern. The discussion of environmental effects will be confined to the Red Crossbill and Boreal felt lichen, as effects on wolffishes have been covered in the section on marine fish and fish habitat.

Red Crossbill Construction activities such as grubbing, excavation, leveling, and the installation of access roads, storm and sewage systems, pipelines, power lines and temporary generating units could result in the loss of potential habitat. Other activities including blasting, dusting, noise and traffic could disturb the Red Crossbill.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 19 Similarly, operational activities (i.e. atmospheric emissions, traffic, noise, lighting and maintenance work) have the potential to disturb the Red Crossbill.

Boreal Felt Lichen Earthworks activities involving the construction of roads, pipelines, power lines and ancillary activities have the potential to disrupt habitat and/or remove host trees within the footprint of the project. Atmospheric emissions, particularly sulfur dioxide, could adversely affect this species. 32. Mitigation Measures (including Habitat Compensation):

1. The proponent was advised of the requirement to provide compensation for harmfully altered, disrupted, or destroyed fish habitat and committed to address this issue with the Department in accordance with the “DFO Policy for the Management of Fish Habitat” (1986). As a result, in consultation with DFO, the proponent has developed a compensation strategy to mitigate losses as appropriate.

2 ¾ To mitigate the loss of 25,589.5 m of productive marine fish habitat associated with the construction of Tier 1 port facilities and marine effluent outfall, the proponent will provide fish habitat compensation in two ways: 1) the strategic placement of armour and filter stone to create a minimum of 17,325 m2 of marine habitat, and 2) the creation of rock reefs designed to provide a minimum of 8,265 m2 of marine habitat. These activities will result in the creation of habitat that will be suitable for various life stages of the American lobster (Homarcus americanus); benefit the flatfish species in the area, and provide area for a diversity of marine life to flourish.

¾ To mitigate the loss of 144.6 Habitat Equivalency Units (1 HEU = 100 m²) of productive riverine fish habitat due to infilling and dewatering associated with the footprint of the Tier 2 facilities and dam on Sandy Pond, the proponent has several fish habitat compensation activities planned:

I. Enhancement of spawning and rearing habitat in reach 18 of Rattling Brook will provide a minimum of 47 HEUs of productive riverine habitat. This involves rearranging the large boulder field in the center of this reach to create a more defined spawning channel and placement of spawning substrate with areas to provide suitable holding and rearing habitat for brook trout.

II. Previous industrial development in the area has resulted in the channelization of several reaches in Rattling Brook making them less attractive for trout spawning. These reaches will be rehabilitated using instream structures to regulate water velocities and substrate placement to provide heterogeneity. This work will provide a minimum of 11 HEU’s of productive riverine habitat.

III. As part of the facility design a diversion channel will be built around the plant site. This channel will be engineered to provide riffle and pool habitat that will be suitable for brook trout. Minimum flows will be provided in this channel and substrates in a variety of sizes will be placed on the stream bed. Riparian cover will also be provided on the stream banks. This activity will provide 20 HEUs of productive riverine habitat.

IV. Several large sections of Northeast River, Placentia will have spawning gravels and other instream features added such as boulders and rock groins to increase the spawning and rearing habitat for salmonid species. This work will take place on several sections; some which have had previous enhancement work completed in the 1960s and 1970s. These activities will provide a minimum of 61 HEUs of productive riverine habitat

V. Enhancement of rearing habitat and holding areas for adult salmonids on Northeast River, Placentia will be undertaken by deepening pool areas. Larger substrates will be used to stabilize the pools to maintain depth and reduce velocity. Spawning gravels will be added to the downstream end of these pools to increase salmonid spawning areas. This activity will produce a minimum of 7.5 HEUs of

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 20 productive riverine habitat.

VI. Major storm events of 2007 have stripped the riparian vegetation from a large portion of the banks of Big Rattling Brook, Ship Harbour that can reduce the suitability of the habitat for salmonids by altering the thermal regime of the brook . The riparian vegetation will be reestablished in this area. This option will provide 10 HEUs of productive fish habitat and will be used if the previous 5 activities cannot provide all the required fish habitat compensation.

¾ To mitigate the loss of 3.6 HEU (1 HEU = 10 000 m²/1 ha) of productive lacustrine habitat due to infilling associated with the construction of Tier 2 facilities and the construction of water control structures (dam’s) on Rattling Brook Big Pond and Sandy Pond, the proponent will create two ponds as part of the diversion channel around the plant facility. These ponds will have appropriate depth and shorelines augmented with substrate of various sizes for rearing habitat and maintenance of water depths. The inflow and outflow areas will have substrate suitable for brook trout spawning. With consideration of mitigation measures identified (i.e. fish habitat compensation program) effects are deemed to be insignificant.

2. DFO has determined that deposition of effluent into Sandy Pond will require designation of Sandy Pond as a TIA under Schedule 2 of the Metal Mining Effluent Regulations. The deposition of effluent into Sandy Pond will result in the destruction of 18.1 ha of lacustrine habitat within the TIA. Fish habitat compensation was identified as an option to mitigate the loss of productive fish habitat associated with the proposed undertaking. The proponent will undertake two activities to compensate for the loss of Sandy Pond: I. Creation of a 15 ha pond 2-8m deep near the Sandy Pond watershed in a small semi-isolated valley. The pond bottom will be prepared by vegetation removal and substrate placement. A low head barrier will be installed at the valley outflow to provide sufficient water depth in the new pond. A small man-made stream will meander downstream from the weir such that appropriate water depths and velocities for fish passage are maintained and will connect to existing stream habitat (Rattling Brook). II. Expansion/Rehabilitation of existing ponds – Within Rattling Brook there are several small shallow ponds (ponds P30, P22, P23) and unnamed bog ponds (reaches 19 and 32) which have been slowly infilling with organics and vegetation. These ponds/pools will have shorelines expanded and excess vegetation removed to regain lost surface area and depth. New shorelines will be augmented with appropriate substrate to improve rearing and spawning suitability and maintain water depths. This activity will provide a minimum of 5.0 ha of productive lacustrine habitat. With consideration of mitigation measures identified (i.e. fish habitat compensation program) effects are deemed to be insignificant.

3. Implementation of appropriate sedimentation and erosion control measures (e.g. silt fences, sediment traps, filter fabric dams, settling basins, natural vegetation filters, coffer dams, etc.) will prevent siltation/sedimentation of localized runoff and ensure the protection of fish and fish habitat during construction related activities. All activities will be conducted between June 1 and September 30, unless otherwise approved by DFO, to avoid sensitive fish spawning and/or incubation periods. ¾ Construction of stream crossings will follow accepted engineering and construction practices to accommodate runoff conditions and comply with regulatory requirements. Watercourse crossings shall be appropriately sized to handle a 25-year return flood period and avoid impacts on fish passage and the stream bed. Watercourse crossings will be aligned so that the original direction of flow is unaltered. Approaches to crossings will be constructed with erosion-resistant materials such as rock or clean gravel. They will be at right angles to streams where possible.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 21 ¾ Cofferdams will be used to keep work areas dry. ¾ Effective sediment and erosion control measures such as rip-rap, filter fabric, drainage channels or wood chip mulches should be installed before starting work in areas prone to erosion in order to prevent sediment from entering any watercourse. These control measures should be inspected regularly during construction to ensure they are functioning properly. All necessary repairs should be made if any damage is discovered. ¾ Drainage control measures, including erosion and sediment control, will control suspended solid material transport by water and erosion of disturbed ground: ♠ Silt fence/curtains – for use across streams and ditches and at toe of fill embankments; ♠ Sediment traps to filter sediment-laden runoff from the site; ♠ Sediment basins to filter sediment-laden runoff at discharge points of drainage; ♠ Rock-lined ditches to control velocities in ditches and to encourage deposit of fines; ♠ Erosion mats on slopes to stabilize against washout; and ♠ Energy blocks in ditches to control velocity and capture sediment. ¾ Fording across watercourses for the purpose of transporting construction equipment should be limited to a one-time event (i.e. over and back) at a single location. Fording sites should be situated where stream banks are stable and approaches to the crossing have low slopes, if possible. If the stream bed or banks are highly erodible or unstable (e.g. dominated by organic materials and fines) and significant erosion/degradation is likely to occur, then these areas should be stabilized or other practices should be used such as a temporary crossing structure. ¾ No discharge to freshwater bodies, other than Sandy Pond and parking lot drainage that will go through an oil/debris separator. Following mitigation, effects are deemed to be insignificant.

4. The water supply control structure constructed at the outlet will retain sufficient water in Rattling Brook Big Pond to supply the site with water, and to meet instream flow needs for protection of fish and fish habitat. Water extraction from Rattling Brook Big Pond will be conducted in adherence to proper guidelines, including installation of fish screens and appropriate timing windows to avoid impacts on fish and fish habitat. DFO guidance will be sought for detailed design and placement. The structure will be an overflow weir-type, approximately 60 m long, with an access footbridge. A flow compensation facility will be incorporated into the dam and will consist of a pipe through the dam structure to maintain flow to Rattling Brook based on a minimum flow requirement of 0.3 m3/s to protect and maintain downstream fish habitat. The facility will be designed to allow for upstream and downstream fish passage. Following mitigation, effects are deemed to be insignificant.

5. Mitigations for blasting are contained in Wright and Hopky (1998) and include: ¾ Large charges should be subdivided into a series of small charges and time delayed to reduce the overall detonation to a series of small detonations. For multiple charges, time-delay (e.g., blasting caps) should be used to reduce the overall detonation to a series of single explosions separated by a minimum of 25 millisecond delay between charge detonation; ¾ The on-land set-back distance from the blast site to the watercourse and the set-back distance (zone) around the blast site in the watercourse are based on the maximum weight of the charge to be detonated at one instant in time and the type of fish and fish habitat in the area of the blast; ¾ Blasting activities are to take place at a minimum set distance from the watercourse; ¾ If on-land blasts are required nearer to the watercourse than indicated above, then additional mitigation measures include the following:

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 22 ♠ Installation of bubble/air curtains to disrupt the shockwave. When bubble curtains are used, the curtain should surround the blast site and be started up only after fish have been moved outside the surrounded area; ♠ Blasting should be undertaken at the time of least biological activity or biological sensitivity; ♠ Isolation of the work area from fish movement; ♠ Detonation of small scaring charges set off one minute prior to the main charge to scare fish away from the site, and ♠ The use of noise generators to move fish out of the area. ¾ To confine the blast, sand or gravel should be used to backfill blast hoses to grade or to streambed/water interface ¾ Blasting mats should be placed atop the blasting holes to minimize the scattering of blast debris; ¾ Ammonium nitrate based explosives (i.e., Ammonium Nitrate Fuel Oil mixtures or ANFO) should not be used in or near water due to the production of toxic by-products (ammonia); ¾ All blasting and other associated equipment and products are to be removed from the blast area, including any debris that may have entered the aquatic environment; ¾ Mitigations will be employed to reduce the effect of noise on marine fish and fish habitat such as bubble curtains and well-maintained equipment mufflers. Following mitigation, effects are deemed to be insignificant.

6. Sedimentation control measures such as a silt curtain will be employed during dredging, wharf expansion, placement of shore and scour protection and installation of the marine pipeline. All dredge spoils (including displaced sediment from the piling installation that will be pumped from inside the pile) will be collected and disposed of on land in accordance with regulatory requirements. Floating booms should be in place during all marine construction activities to contain potential fuel leaks. No trenching will be used in the placement of the effluent pipeline. The elemental phosphorus encapsulated in the existing dock will not be disturbed. Water will be monitored for contaminants. Following mitigation, effects are deemed to be insignificant.

7. Within the TIA, shallow groundwater flow will be reduced by grouting. Any seepage will eventually discharge downgradient to the streambed 700-800 m north of Sandy Pond. The proponent will install groundwater monitoring wells down gradient of the residue storage area to monitor any potential impacts. The remaining groundwater plume discharging to Long Harbour is expected to migrate primarily in the deep rock system. This groundwater transport to Long Harbour is very slow, in the order of 1,500 years, before any discharge to the marine environment occurs. Groundwater contaminant plumes are expected to reach equilibrium after many years following Closure. Following mitigation, effects are deemed to be insignificant.

8. Mitigations will be employed to reduce impacts of washwater on marine fish, fish habitat and water quality such as collecting washdown/runoff in sumps and recycling it in plant site process water. During the winter, glycol is used to clean the vessel’s hold. The glycol is provided from a tanker truck on the wharf and is continually recycled in a closed loop during the cleaning process. After cleaning, the contaminated glycol is removed from site in the tanker truck for off-site disposal. Following mitigation, effects are deemed to be insignificant.

9. All effluent will be treated, tested and monitored to ensure compliance with regulatory requirements and then discharged through a diffuser located in an area of oceanographic mixing between Shag Rocks and Crawley Island to maximize dispersion. An Environmental Effects Monitoring program will also be developed to measure the effectiveness of the Regulations and applied mitigations in protecting the local environment. Following mitigation, effects are deemed to be insignificant.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 23 10. The CSZ for the wharf expansion will be clearly marked with buoys. To reduce the effects on fishing activities, Vale Inco NL will restrict the size of the area to be set aside for a CSZ to allow as much use of the established grounds in the vicinity of the construction area as possible (within the constraints of safety). A Project Fisheries and Aquaculture Liaison Committee will be established to facilitate fisheries-industry consultation on all aspects of the marine facilities Construction Phase as they relate to established fisheries and aquaculture operations. Following mitigation, effects are deemed to be insignificant.

11. Any material entering the waterbody must be quickly removed and disposed of. Construction of all in- waters works must be constructed and operated in accordance with the Navigable Waters Protection Act Conditions of Approval.

12. Preventative measures are the primary mitigation measures associated with the accidental events. These include: ¾ Compartmentalized tanker vessels for acid shipment and bulk concentrate and designated shipping lanes; ¾ Preventative measures for dam failure include selection of appropriate materials for construction of the process equipment and storage facilities; strict adherence to inspection/maintenance schedule; training and education for operators to ensure proper reaction to all possible scenarios. ¾ Storage tanks and facilities will be designed to conform to the Newfoundland Department of Environment and Conservation regulations with key design features including installation of impervious mats, containment dykes, and sump and collection systems. ¾ The Acid pipeline will be double-walled. All pipelines will be located within trenches or open culverts to contain and divert any pipeline spills. Pipelines will be monitored at both ends to detect any loss of pressure and equipped with automatic shutdown systems. There will be an emergency outfall bypass line so that failures within the effluent treatment system would be diverted to Sandy Pond. ¾ Before transporting or storing fuel at the project site, contracted fuel suppliers will be required to provide a copy of a fuel spill contingency plan acceptable to Vale Inco NL. Fuel and other hazardous materials will be handled by persons who are trained and qualified in handling these materials, in accordance with government laws and regulations. ¾ Construction equipment to the worksite in good operating condition, free of leaks, and with all appropriate emission filters. Equipment will be routinely inspected for leaks or mechanical conditions that might result in spills of fuel, lubricating oils or hazardous materials. ¾ Refuelling protocols include: ♠ Use of leak-free containers and reinforced rip and puncture-proof hoses and nozzles; ♠ Use of hoses that have a design pressure rating of at least 150 per cent of the maximum head of the system; ♠ Attendance for the duration of the fuelling operation; ♠ Sealing all storage container outlets except the outlet currently in use; ♠ Smoking permitted in designated areas only and prohibited within 10 m of designated fuel storage areas; ♠ Fuel unloading facilities equipped with drip pans to collect hose drainage and drips; ♠ Fuel transfer lines equipped with check valves to prevent spillage; ♠ Fuel tanks to be self-dyked or be positioned over an impervious mat surrounded by an impervious dyke; located in areas where spills, should they occur, are least likely to flow towards water courses, water bodies, feeder streams, ditches or the ocean; fuel storage at least 100 m from any water body; ♠ Drums of fuel oil, if required at site, to be tightly sealed to prevent corrosion and rust; quantities on

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 24 site during construction to be limited to that required for the current activity and minor equipment maintenance; and ♠ All storage facilities to be located away from construction activity, with secondary containment and regular inspection for compliance with regulations. ¾ Refueling and maintenance activities should be undertaken on level terrain at least 100 m from any surface water. Waste oil should be disposed of in an approved manner. Spills should be reported to the Environmental Emergencies 24-Hour Report Line – 1-800-563-9089 or 772-2083. Less hazardous products and materials should be considered and used whenever possible. ¾ Emergency response and contingency plans will be developed to provide effective and rapid mitigation to all accidents and training and education will be provided to ensure proper reaction to accident scenarios. Following mitigation, effects are deemed to be insignificant.

13. There will be no overlap or interaction with the activities and projects identified for cumulative effects assessment with the exception of marine shipping and commercial fisheries. The estimated additional maximum of 25 vessel round trips per year into Long Harbour are within historical activity for the area and represent a very small percentage of Placentia Bay vessel traffic. Vessels operating within Placentia Bay must comply with the Eastern Canada Traffic Services (VTS) Zone Regulations; Collision Regulations; and all other applicable regulations under the Canada Shipping Act to limit the potential for cumulative effects. With respect to the commercial fishery, no utilized habitat loss or displacement will occur. Following mitigation, effects are deemed to be insignificant.

14. Extreme weather and wave conditions will be accommodated in Project engineering design and planning by following or improving all relevant building and construction specifications, codes and permits. The potential effects of storm surges in Long Harbour will be considered and provided for in engineering design. Long Harbour is sheltered, so any storm surges, while they may affect water levels, would not likely be accompanied by large destructive waves. Placentia Bay is essentially free of sea ice and icebergs most years, and as the concentrate carrier is ice-strengthened for operations in Labrador, sea ice should not hamper marine activities. Structures will be built to applicable building codes, and given the low probability of a major seismic event, the effect on the Project is considered to be negligible. Settling Ponds will be designed adhering to guidelines with respect to the accommodation of storms (1:5, 1:10, and 1:100 years storms), effective capacity, retention times and location. The Project design criteria (for physical plant, process, water cycle, storm-water runoff and residue disposal) incorporates an anticipated temperature increase of approximately 2 per cent and a variation in precipitation ranging between a 4 per cent decline and a 3 per cent increase. The 24-hour rainfall depths for Probable Maximum Precipitation (PMP) and 1:100-year events will be used to design the facilities where the peak flow rate is critical (e.g., Sandy Pond spillway, runoff discharge ditch). Following mitigation, effects are deemed to be insignificant.

Air Quality For the Construction Phase, the proponent has committed to controlling emissions by: ¾ Establishing and flagging Buffer zones prior to any disturbance activities; ¾ Leaving natural vegetation in place wherever possible; ¾ Limiting any stockpiling of materials to reduce fugitive dust emissions: ♠ Spraying Areas with high dust potential with water; ♠ Using calcium chloride on roads as required to suppress dust according to EC’s “Best Practices for the Use and Storage of Chloride-Based Dust Suppressants”; and ¾ Using air filters and regular maintenance of vehicles to control emissions.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 25 The following design and operational measures will be instituted to limit the emission and subsequent dispersion of contaminants from the operations phase of the project. ¾ Air pollution control systems: ♠ Baghouses for hygiene dust control – used predominantly at concentrate and limestone transfer and handling locations; ♠ Scrubbers for venting gas streams and copper electro-winning cells – used to reduce aerosol mists, chlorine gas and particulate carryover from entering the environment; ♠ Adequate building ventilation to ensure good in-plant air quality; and ♠ Water spray dust suppression, when required, for roads and for the Matte Plant residue storage site. ¾ All equipment containing potential air contaminants will be routed through air pollution control equipment prior to release to the air. ¾ All conveyors will be covered and transfer points vented through air cleaning prior to release to air. ¾ Dust collection systems will be in place at all material transfer points and material will be conveyed between locations in covered conveyors. ¾ Air emissions will be monitored to ensure that environmental regulations are met. ¾ Environmental control equipment will be monitored to ensure that operating parameters are met. ¾ Precautions will be in place to monitor and prevent the release of chlorine gas produced during the process for the Hydromet Plant. Alarm systems and emergency safety procedures will be established to properly manage any accidental event involving chlorine.

The residual effects of construction and operation activities on air quality are predicted to be not significant based on the proposed mitigation measures.

The air quality effects, in general, do not extend beyond the property boundary. As there are no other facilities in close proximity, it is not expected that the Project will affect the air quality at/near other facilities in the area, such as the Port of Argentia, Marystown Shipyard, Cow Head, or the Come By Chance area.

Avifauna Mitigation measures to control turbidity/sedimentation associated with construction activities, such as sediment curtains, will be outlined in the Environmental Protection Plan (EPP). The EPP is required under the Provincial EA and will be reviewed by Provincial and Federal Departments. With these measures in place, effects on marine fish are expected to be temporary and minimal, resulting in negligible effects on the foraging efficiency of marine birds.

The Bald Eagle is not expected to be affected by construction noises. The residual effects of noise on other avifauna during the construction phase are predicted to be not significant based on their limited magnitude, geographic extent, duration and reversibility.

Mitigation measures for routine activities during the operation phase, as outlined below, will be described in the EPP after consultation with the Canadian Wildlife Service. ¾ Dust collection systems; ¾ Atmospheric emission control systems; ¾ Treatment of marine effluent; ¾ Careful timing and limited duration of each activity; ¾ Installation of yellow or red “bird-flight diverters” (originally derived from spiral vibration dampers) to increase visibility of phase (conductor) and ground wires; ¾ Incorporating sufficient spacing between phase wires, and between phase and groundwires to prevent

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 26 large-winged birds such as Bald Eagles from completing a circuit; ¾ Insulating jumper wires connecting transformers, protective cutouts, and surge arresters; and ¾ Insulating metal cross-arm braces or substituting wooden cross-arm braces.

The residual effects of the operation phase on marine birds are predicted to be not significant with the implementation of these mitigation measures, and taking into account the absence of high-use bird flight corridors in the area.

With regard to cumulative effects, only marine shipping and hunting have any overlap or interaction with the project. The additional approximately 25 (maximum) vessel round trips per year into Long Harbour are well within historical activity for the area and represent only a very small percentage of current or projected vessel traffic. Any effects of the project’s routine activities on marine-associated birds would be minimal.

The winter murre hunt (primarily Thick-billed Murre) is regulated by the federal Canadian Wildlife Service, therefore any effects can be considered to be not significant.

Species at Risk Red Crossbill The residual effects of construction and operational activities on the Red Crossbill are expected to be not significant once the mitigation measures (to be detailed in the EPP) are implemented (e.g. minimization of vegetation removal, establishing a buffer zone around active nests, surveys of blast sites one hour prior to blast, use of dust suppression measures, proper vehicle maintenance including mufflers and other noise suppression equipment, minimization of lighting and atmospheric emission control systems).

Boreal Felt Lichen Most of the confirmed locations of boreal felt lichen within the project area should not be physically disturbed. In addition, implementation of mitigation measures that will be detailed in the EPP (e.g., minimization of vegetation removal, installation of atmospheric emission control systems) are predicted to result in no significant residual effects.

Any added effects on the Placentia Bay ecosystem from routine activities associated with the proposed nickel processing plant at Long Harbour will likely not change the effects predictions when viewed on a cumulative basis, unless significant marine hydrocarbon or chemical spills occur. Therefore, the cumulative effect of the project in association with the effects of other projects and activities in Placentia Bay on Species at Risk is predicted to be not significant.

Accidents and Malfunctions Five potential accidental events associated with the project were assessed: 1. Marine shipping accident resulting in release of sulphuric acid to the marine environment 2. Marine shipping accident resulting in release of loose nickel concentrate to the marine environment 3. Marine shipping accident resulting in release of Bunker C oil to the marine environment 4. Large berm failure on Sandy Pond resulting in release of residue to terrestrial and freshwater environments 5. Pipe rupture resulting in release of chlorine gas to the environment

Mitigation measures will be in place to prevent these occurrences including: ¾ Compartmentalized tanker vessels; ¾ Designated shipping lanes in Placentia Bay; and ¾ Environmental Protection Plan (EPP).

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 27 In the event that an accident does occur, an Emergency Response and Contingency Plan (ERCP) will be in place. The ERCP is required under the Provincial EA and will be reviewed by Provincial and Federal Departments.

Sulphuric Acid Spill The scenario involved a springtime release of 7,500 tonnes of concentrated sulphuric acid as a result of a marine shipping accident in Placentia Bay at the mouth of Long Harbour. Any residual effects on avifauna were predicted to be not significant taking into account the reversibility and limited magnitude, geographic extent and duration of the event.

Bulk Concentrate Spill The scenario involved a springtime release of 30,000 tonnes of nickel concentrate as a result of a marine shipping accident in Placentia Bay at the mouth of Long Harbour. Considering the preventative mitigation and associated low likelihood of such a large release of loose nickel concentrate, the localized nature of any accumulation of concentrate on the sea bottom, and the likely low bioavailability of the primary chemicals associated with the concentrate, the residual effects on avifauna were predicted to be not significant.

Effects of an Oil Spill The scenario involved a springtime release of 2,180 m3 of Bunker C oil due to a shipping accident at a location between Crawley Island and southern shore of Long Harbour . The primary concern related to such an accidental event is the potential effect on the proximate shallow subtidal and intertidal zones.

Given the low probability of occurrence of an accidental release of Bunker C oil during the Project, the low probability of such a slick reaching inner harbour eagle concentration areas or inner Placentia Bay nest concentration areas, and the implementation of an appropriate Emergency Response Plan in the unlikely event of such a release, the residual effects of an accidental release of Bunker C oil on marine-associated birds were predicted to be not significant.

Effects of a Dam Failure on Sandy Pond The scenario involved in this assessment is characterized by a release of approximately 3.5 million m3 of water/residue mixture from Sandy Pond as a result of a dam failure in the fall of Year 15 of the Operation Phase. Released water/residue mixture would eventually reach the marine environment of the inner portion of Long Harbour and alter marine habitat.

Based on the low likelihood of release of water/residue mixture to Long Harbour (preventative mitigative measures), the large buffering capacity of seawater, and the low bioavailability of chemical constituents of the water/residue mixture, the residual effects of a dam failure on avifauna and species at risk were predicted to be not significant.

Effects of Chlorine Gas Release The scenario involved a springtime release of 59.2 kg of chlorine gas due to a pipe rupture at the Tier 2 plant site. Based on the low likelihood of release of chlorine gas as a result of a pipe rupture (i.e., preventative mitigative measures), rapid dispersion in air, and rapid initial loss of chlorine in seawater, the residual effects of a chlorine gas release on avifauna and species at risk were predicted to be not significant.

33. Navigation Environmental effects of the project on navigation are taken into consideration as part of the environmental assessment when the effects are indirect, that is when the effect is the result of a change in the environment. Direct effects on navigation are not considered in the environmental assessment, but any measures necessary to mitigate direct effects will be included as conditions of the Navigable Waters Protection Act approval.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 28

[X] For this environmental assessment only direct effects were identified; therefore, the effects of the project on navigation are not addressed in the environmental assessment.

For this environmental assessment indirect effects were identified and have been addressed in the environmental assessment. 34. Significance of Adverse Environmental Effects: With consideration to the mitigations that will be implemented, the project is not likely to cause significant adverse environmental effects.

35. Public Participation in Screening under Subsection 18(3) of CEAA: Was it considered appropriate in the circumstances? Yes No a) Explain why public participation was or was not considered appropriate. The responsible authorities considered public participation appropriate to encourage the public to participate in a transparent EA process and to identify public support or concerns in regard to the project. b) If considered appropriate, provide details of the public participation program. The Responsible Authorities, DFO and TC, has decided that, in accordance with subsection 18(3)(a) of CEAA, the scoping document was made available to the public via the Canadian Environmental Assessment Registry (CEAR) internet site. The scoping document provided the public with a description of the scope of project, the factors to be taken into consideration in the federal screening EA and the scope of those factors. The public was provided with an opportunity to examine and comment on the draft screening report. Comments received from the public have been considered in the EA. The finalized screening report will be available for public review for a period of two weeks, before a decision is made on whether or not the project will be allowed to proceed. 36. Summary of Public Comments and Concerns Related to Screening under Subsection 18(3): The draft screening report was available for public review between June 2 and June 16, 2008. Comments were received from Argentia Area Chamber of Commerce, Mining Watch Canada, a Private Citizen, Sierra Club of Canada, and the Town of Long Harbour and Mount Arlington Heights. Comments from each are briefly summarized below. Argentia Area Chamber of Commerce Expresses support for the project. The Chamber is confident that Vale Inco will proceed with this development in a manner which satisfies the needs of communities in terms of stewardship of the physical environment while providing for important economic growth. Taking Sandy Pond for use as a TIA does represent the loss of a natural pond, however, the proponent has committed to the important principle of No Net Loss of fish habitat and our region has an abundance of ponds which can be used for recreational fishing.

Private Citizen Opposed to the operation being built in Long Harbour and expressed concern re the amount of water that will be used; the chemicals in the effluent; the containment proposal to ensure no leaching into the water table and ocean; the size of the waste disposal area on land; and the stability of the land during heavy precipitation.

Response The impact of water use from the Rattling Brook Big Pond system was reviewed and assessed during the Environmental Assessment. The proponent will be required to maintain a minimum flow of 0.30 to 0.35 m3/s to protect fish and fish habitat downstream of the proposed freshwater intake and will monitor flows to ensure that there is no impact to fish and fish habitat.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 29 The effluent will treated and monitored to ensure it meets regulatory requirements prior to discharge to the marine environment.

Sandy Pond is located at the height of the watershed and is a natural depression in the bedrock. It has good water inflow and low metal leaching potential. Dam reliability is high for this site as the dams are founded on bedrock. There would be minimal leaching to ground water from this site and monitoring wells will be installed to verify predictions and modeling results.

The waste disposal area on land required for the Matte Plant will be approximately 40 hectares, and will be surrounded by a 4 metre high containment berm. Excess water would be collected, treated, and discharged into Long Harbour.

The potential for flood is mitigated by the terrain, as the site slopes towards the storm-water pond and from there into the polishing ponds. For Sandy Pond a sequence of two 1:100 annual runoff and 1:100 spring runoff events were combined to provide the design criterion.

Sierra Club of Canada Concern with the level of assessment for the EA, the consultation with the public and with Aboriginal Peoples; the assessment of two proposals (Matte and Hydromet) together; the modeling of one year storm events and their impacts (five hundred year events should be modeled); cumulative impacts of current and proposed undertakings; threats from invasive species; the assessment of alternatives; and impacts of ship strikes on right whales in particular.

Response A screening level assessment was undertaken as there were no components of the development proposal on the Comprehensive Study List Regulations; the impacts and the mitigation measures are well understood for this type of project, so the project is not anticipated to cause significant adverse environmental effects

The scoping document, which included the factors to be assessed and the scope of those factors was made available to the public in January 2007. The Draft Screening Report was available for public review and comment from June 2-16, 2008. Environment Canada held public consultation sessions on the proposed amendments to the Metal Mining Effluent Regulations to obtain feedback from the general public and stakeholders. Transport Canada also participated regarding a Governor in Council Decision under the Navigable Waters Protection Act. The proponent held several open house sessions. The public also had the opportunity to comment on the component studies, the EIS and the revised EIS. Aboriginal groups were not specifically consulted regarding this project as there are no known potential interests of Aboriginal groups in the area.

The EA covers both proposals (Matte and Hydromet) as the Voisey’s Bay Development Agreement signed in 2002 between the proponent and the Province of Newfoundland and Labrador requires the establishment of a commercial nickel concentrate processing plant using hydrometallurgical technology, or if this technology is not feasible, a nickel matte processing facility (Matte Plant) would be constructed. As such, this Environmental Assessment (EA) for the Long Harbour Commercial Nickel Processing Plant includes both processing options.

The potential for flood is mitigated by the terrain, as the site slopes towards the storm-water pond and from there into the polishing ponds. For Sandy Pond, a sequence of two 1:100 annual runoff and 1:100 spring runoff events were combined to provide the design criterion.

There will be no overlap or interaction with the activities and projects identified for cumulative effects assessment with the exception of marine shipping and commercial fisheries. The estimated additional maximum of 25 vessel round trips per year into Long Harbour are within historical activity for the area and represent a

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 30 small percentage of Placentia Bay vessel traffic. Vessels operating within Placentia Bay must comply with the Eastern Canada Traffic Services (VTS) Zone Regulations; Collision Regulations; and all other applicable regulations under the Canada Shipping Act to limit the potential for cumulative effects. Most vessels will arrive at Long Harbour loaded with cargo and consequently large amounts of ballast water will not be on board. Shipments will be by the concentrate carrier from Labrador, and not expected to carry any non-native species. Vale Inco NL will require contractors and vessel charters to not dump bilge or foreign ballast water outside the allowable restrictions of the Canada Shipping Act. As required, special measures will be taken for ship movements into Placentia Bay, especially with respect to any threat of invasive species introduction as a consequence of ballast water exchange in the Gulf of St. Lawrence.

Several drafts of the analysis of alternatives document was reviewed as federal agencies required changes and additions to the document. This document has been reviewed by professionals and judged to be satisfactory and consistent with industry standards used for other projects across Canada.

Once ships rendezvous with the pilot boat south of Red Island, speed will decreases to 8 knots. Bulk carriers and container ships could travel at a maximum speed of ~10 knots to within 5 nautical miles of the wharf, when they will decrease speed to 2 knots. Based on available information, marine mammals (including seals, whales and otters) will avoid the immediate area around vessels, thereby minimizing the probability of collision.

Town of Long Harbour and Mount Arlington Heights The Town endorses Fisheries and Oceans Canada’s issuance of a Fisheries Act Section 35(2) Authorization and recommendation of the scheduling of Sandy Pond as a Tailings Impoundment Area (TIA) under the Metal Mining Effluent Regulations (MMER). Secondly, the Town of Long Harbour & Mount Arlington Heights endorses Transport Canada’s issuance of a Formal Approval pursuant to Paragraph 5 (1) (a) of the Navigable Waters Protection Act and the potential issuance of a waterlot lease for the purposes of enabling the project.

Mining Watch Canada Expressed concern re the use of Sandy Pond as a waste disposal site; the selection of Long Harbour as the site for the plant; and the fish habitat compensation strategy. Mining Watch expressed concerns with the Multiple Accounts Analysis, pertaining to the Analysis of Alternatives to the use of Sandy Pond for waste residue storage. Other comments included the lack of discussion on the Rusty Blackbird, windborne air contaminants and the possible impact on species at risk, mitigation measures to stop birds from drinking Sandy Pond water; concern about Chromium 6 emissions and the possible creation of Persistent Organic Pollutants; expected level of manganese and other metals chemicals in the marine effluent; and clarification of the manganese contamination of the marine environment would be related to airborne emissions or the effluent pipe. Concern was also noted on the consultation with fishers in Long Harbour and aboriginal groups.

Response Sandy Pond is located at the height of the watershed and is a natural depression in the bedrock. It has good water inflow and low metal leaching potential. Dam reliability is high for this site as the dams are founded on bedrock There would be minimal leaching to ground water from this site and monitoring wells will be installed downstream of the main dam to verify predictions and modeling results.

The EA is based on the project description as provided by the proponent, for a development proposal in Long Harbour, NL.

Prior to finalization of the Fish Habitat Compensation Plans, the proponent must hold public sessions, providing the opportunity for local stakeholders to provide input on the proposed fish habitat compensation plans.

Several drafts of the Analysis of Alternatives document was reviewed as federal agencies required changes and

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 31 additions to the document. This document has been reviewed by professionals and judged to be satisfactory, consistent with industry standards used for other projects across Canada. Vale Inco NL Ltd. has volunteered to meet with stakeholders to explain the Multiple Accounts Analysis.

Rusty Blackbird is listed by COSEWIC as a species of special concern as a result of a continent-wide decline within the breeding range and wintering areas. It was observed incidentally outside the project area during baseline surveys. This species is not listed under the Species at Risk Act.

The residue storage pond will have little or no food to attract birds. However, pond water will be of pH eight to 10, so if birds happen to land there, they will not be harmed. The Environmental Risk Assessment Report indicates that a health risk to wildlife is not expected if Sandy Pond is used sporadically for drinking water.

Windborne air contaminants have been modeled, and in general, the air quality effects do not extend beyond the property boundary.

The effluent will have to comply with federal and provincial regulations. As per the MMER, an Environmental Effects Monitoring Program will be developed to evaluate the potential effects of the effluent on fish populations, on fish tissue and the benthic invertebrate community and to monitor effluent and water quality. This is the responsibility of Environment Canada.

37. Follow-up Program: Was it considered appropriate in the circumstances? Yes No a) Explain why a follow-up program was or was not considered appropriate. In general, sound environmental management includes initiatives such as follow-up monitoring, environmental effects monitoring (EEM), environmental compliance monitoring (ECM), impact prediction verification, and environmental protection planning. A follow-up program can incorporate elements of all the above. As per its responsibilities under CEAA, and with the support of other federal authorities, DFO will ensure an appropriate follow-up program is developed and carried out, and those mitigation measures considered in the environmental assessment are implemented.

As per the MMER, an Environmental Effects Monitoring Program will be developed to evaluate the potential effects of the effluent on fish populations, on fish tissue and the benthic invertebrate community and to monitor effluent and water quality. This is the responsibility of Environment Canada.

The development and implementation of a follow-up program is the proponent’s responsibility with respect to design, funding, data collection, interpretation, report writing, etc. As the lead responsible authority, DFO will maintain an ongoing co-ordination role with respect to the follow-up program. The Department will consult with regulatory agencies and stakeholders, as appropriate, during review and implementation of proposed monitoring initiatives to ensure that federal interests are appropriately addressed and that mitigation measures are implemented and commitments made by the proponent are fulfilled. b) If considered appropriate, provide details of the follow-up program. Vale Inco NL has committed to design an effects monitoring program (including study design, numbers of replicates, sample locations, sampling frequency, and laboratory analysis standards) in consultation with DFO, Environment Canada, and the Provincial Department of Environment and Conservation. This program will include the following: • Freshwater and sediment quality • Marine water and sediment quality • Fish and fish habitat (including aquatic species at risk if found in the area)

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 32 • Cultured blue mussels (metals) • Winter flounder • Boreal felt lichen • Top-level predator (metal body burden)

38. Other Monitoring and Compliance Requirements: The DFO has determined that a fish habitat compensation monitoring program will be developed by the proponent, in consultation with DFO to monitor the success/utilization of compensatory habitat associated with the loss of productive marine fish habitat associated with the construction of Tier 1 port facilities and marine effluent outfall, the loss of productive riverine fish habitat due to infilling and dewatering associated with the footprint of the Tier 2 facilities and dam on Sandy Pond, and the loss of productive lacustrine habitat due to infilling associated with the construction of Tier 2 facilities and the construction of water control structures (dam’s) on Rattling Brook Big Pond and Sandy Pond.

An additional fish habitat compensation program is required to monitor the success/utilization of compensatory habitat associated with the loss of productive fish habitat resulting from the deposition of effluent into Sandy Pond.

TC will conduct compliance monitoring visits to ensure that the proponent has implemented all the conditions listed on the NWPA Conditions of Approval to ensure that the potential impacts to navigation are limited. In addition the proponent will monitor the implementation and effectiveness of mitigative measures applied during the project.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 33

COURSE OF ACTION DECISION 47. Course of Action Decision: (under Section 20 of CEAA)

DFO may exercise its power, duty or function, i.e. may issue the authorization - where the project is not likely to cause significant adverse environmental effects. Confirm below the specific power, duty or function that may be exercised. DFO to issue Fisheries Act Authorization or Approval DFO to recommend to Governor in Council to exercise power, duty or function DFO to proceed with project (as proponent) DFO to provide financial assistance for project to proceed DFO to provide federal land for project to proceed

DFO may not exercise its power, duty or function - the project is likely to cause significant adverse environmental effects that cannot be justified in the circumstances.

DFO shall refer the project to the Minister of the Environment for referral to a mediator or review panel if it is uncertain whether the project is likely to cause significant adverse environmental effects.

DFO shall refer the project to the Minister of the Environment for referral to a mediator or panel - the project is likely to cause significant adverse environmental effects that may be justified in the circumstances.

DFO shall refer the project to the Minister of the Environment for referral to a mediator or review panel - public concerns warrant a reference to a mediator or review panel.

48. Approved by: ______47. Date: ______

49. Name: Wayne M. Follett

50. Title: Regional Director General

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 35 51. References:

Department of Fisheries and Oceans. 1994. Factsheets 1-26. Department of Fisheries and Oceans (Newfoundland Region), St. John’s, NL. Gosse, M. M., Power A.S., Hyslop D.E., and Pierce S.L. 1998. Guidelines for protection of freshwater fish habitat in Newfoundland and Labrador. Department of Fisheries and Oceans, St. John’s, NL. Vale Inco Newfoundland and Labrador Limited. April 2008. Environmental Impact Statement, Long Harbour Commercial Nickel Processing Plant. Submitted by Vale Inco NL, St. John’s. Vale Inco. April 2008. Hydromet Plant Residue Storage Options for the Commercial Nickel Processing Plant at Long Harbour, Newfoundland and Labrador. Submitted by Vale Inco NL, St. John’s. Voisey’s Bay Nickel Company Limited. November 2007. Environmental Impact Statement, Long Harbour Commercial Nickel Processing Plant. Submitted by VBNC, St. John’s. Wright, D.G., and G.E. Hopky. 1998. Guidelines for the use of explosives in or near Canadian fisheries waters. Can. Tech. Rep. Fish. Aquat. Sci. 2107: iv + 34p.

Screening Report Commercial Nickel Processing Plant, Long Harbour, Placentia Bay 36

Figure 1.0 – Layout of Development Proposal

Figure 2.0 – Watersheds in Area of Development Proposal 55° 40’ 20’ 54° Come by Chance Arnold’s Cove Placentia Bay Radar Vessel Traffic Services Whiffen Radar Coverage Head 45’ 45’ Traffic Separation Scheme (TSS) 9 Limits of Reporting Area

Calling in Point 8 d a n l 7 d n 30’ u 30’ f o w e Long N Harbour 6 Pilot Station Argentia Sector 2 Placentia Traffic VHF Ch 12 15’ 15’ Marystown 5B Placentia S ector B Harbour oundary 5A 4B Burin 25 Naut Pearce Peak ical M Sector 1 iles 4A Radar 14 VHF Ch 1113B 47° 47°

3A Cuslet Bass Point Radar 2B y a B Cape St. Mary’s ’s y r 2A a M 1B t. 1W S

45’ 1A 45’ VTS Outer 1E Zone Limit 1S

55°40’ 20’ 54° Figure 3.0 – Placentia Bay Traffic Scheme

Figure 4.0 – Hydromet Residue Storage Options

Appendix A

Screening Scoping Document

for Commercial Nickel Processing Plant at Long Harbour, NL

CEAR Reference Number:

06-01-23173

Prepared pursuant to the Canadian Environmental Assessment Act (CEAA)

by

Fisheries and Oceans Canada and Transport Canada

November 3, 2006

Table of Contents

Overview of the Development Proposal ...... 1

Involvement of the Responsible Authorities ...... 2

Involvement of Other Federal Authorities ...... 3

Canada-Newfoundland and Labrador EA Harmonization ...... 3

Scope of the Project for the Federal Environmental Assessment...... 3

Factors to be Considered in the Federal Environmental Assessment ...... 5

Any change to the project that may be caused by the environment ...... 6

Alternatives ...... 6

Malfunctions and Accidents ...... 6

Cumulative Environmental Effects ...... 6 Scope of the Factors to be Considered in the Federal Environmental Assessment ...... 6 Physical and Natural Environment ...... 6 Socio-Economic and Cultural Environments ...... 7

Public Participation under 18(3) of CEAA ...... 7 Public Participation during Governor-in-Council (GIC) Approval of MMER Amendment...... 7

Canadian Environmental Assessment Registry (CEAR) ...... 7

Figure 1 - Map of Development Proposal ...... 8

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Overview of the Development Proposal

Voisey’s Bay Nickel Company (VBNC - the proponent), a subsidiary of Inco Ltd., proposes to construct, operate, and eventually decommission a nickel processing plant to produce refined nickel product and associated copper and cobalt products. A Demonstration Plant was constructed in Argentia, NL in 2005 to establish the commercial, technical and economic feasibility of a hydrometallurgical technology to process the Nickel Concentrate. Should a Hydrometallurgical Plant (Hydromet Plant) option prove not to be technically or economically feasible, a commercial hydrometallurgical nickel-matte processing facility (“Matte Plant”) is proposed as an alternative means to produce refined nickel. Selection between the two processing technologies will be made in 2008. The Environmental Assessment (EA) for the Long Harbour Commercial Processing Plant will include both options.

The proponent proposes to locate the plant on the south side of Long Harbour, Placentia Bay, NL at approximately 47°25’N and 53°49’W. While some components of the development proposal are proposed for a “brown field” site (area was previously used as a phosphorus plant), other components will be located on a “green field” site above the harbour on the south side. The map attached as Figure 1 provides further details on the entire development proposal.

Construction at the site for the Hydromet and Matte Plant options would include the repair and upgrading of the existing wharf by infilling the area to a maximum width of 90 m to create a two-berth wharf and dredging of approximately 9,000 cubic metres of sediment at the wharf site. A 3-kilometre road would be constructed from the wharf to connect the main plant preparation and processing buildings. Existing roads would be upgraded and extended as necessary. A 2 kilometre pipeline would be constructed to obtain process water from Rattling Brook Big Pond. Other activities would include the construction of processing facilities, sewage treatment facilities, administrative offices and laboratories; and the extension of the power supply from the existing substation.

The Hydromet Plant option would have a design capacity to produce 50,000 tonnes per year (t/y) of nickel, 3,270 t/y of copper, and 2,460 t/y of cobalt. The Hydromet plant would require 65 hectares with an additional 85 hectares required for the pipeline and residue ponds to the northeast of the harbour. The Hydromet proposal includes the construction of a 3.8 kilometre pipeline to Sandy Pond for the disposal of 375,000 t/y (dry basis) of neutralized slurry residue; and the construction of containment dams on Sandy Pond to contain the residue and on an unnamed pond that will function as a clarification pond. The disposal of waste residue in Sandy Pond is considered a deposit of a deleterious substance under subsection 36(3) of the Fisheries Act. The proposed deposition of waste residues in natural waterbodies frequented by fish will be influenced by the results of the Analysis of Alternatives, which will analyze alternatives to waste residue disposal in Sandy Pond. Treated effluents totaling 3 million cubic metres per year are proposed to be discharged to the marine environment.

The Matte Plant option would have a design capacity of 50,000 t/y of nickel, 17,800 t/y of copper and 900 t/y of cobalt. The matte plant would require 65 hectares with an additional 40 hectares required for the sub-aerial disposal of the gypsum residue from the refinery. Waste gypsum slurry (106,000 t/y) would be transported 2 kilometres by pipeline to a storage site southeast of the plant and surrounded by a 4 metre high - 2 - containment berm and no underwater disposal area(s) would be required. An iron/arsenic residue (5,900 t/y) would be stored in a lined pond adjacent to the process plant and would be disposed of at an off-site facility (secure landfill or sent to another Inco facility for further processing and disposal). A portion of the watershed may need to be redirected away from the storage site. Treated effluents would be discharged to the marine environment.

The construction phase of the development is expected to begin in 2009, with the facility commissioned and operational by 2012. The construction phase would require approximately 3,000 person-years of employment, while operation of the Hydromet Plant and the Matte Plant would require 400 and 350 employees respectively. The planned lifespan of the facility is 20 years. The entire development proposal is valued at approximately one billion dollars.

Involvement of the Responsible Authorities

The Canadian Environmental Assessment Agency sent the environmental registration for the Commercial Nickel Processing Plant to relevant federal authorities on March 17, 2006 pursuant to sections 4 and 6 of the Federal Coordination Regulations. Fisheries and Oceans Canada (DFO) and Transport Canada (TC) indicated they would likely have decision-making authorities in relation to certain components of the Long Harbour development proposal. As a result of their respective roles, DFO and TC would be Responsible Authorities (RA’s) under the Canadian Environmental Assessment Act (CEAA). As such, both departments are required to ensure that an environmental assessment (EA) is conducted pursuant to CEAA. DFO’s responsibility to ensure an EA is completed relates to the issuance of a permit, license or other approval that is included in the Law List Regulations of the Canadian Environmental Assessment Act. TC’s responsibility to ensure an EA is completed are; 1) a potential lease requirement within the federally administered harbour of Long Harbour may be necessary to enable the project, and 2) the issuance of a permit, license or other approval that is included in the Law List Regulations of the Canadian Environmental Assessment Act.

DFO has determined that several aspects of the development proposal are likely to result in a harmful alteration, disruption, or destruction (HADD) to fish habitat and therefore require a Subsection 35(2) Fisheries Act Authorization. In addition, in order to authorize the deposit of a deleterious substance into a natural waterbody frequented by fish (i.e. Sandy Pond), Environment Canada and DFO have determined that it would be necessary to develop a regulatory framework that would require the amendment of the Metal Mining Effluent Regulations (MMER) so that they apply to Hydromet facilities. This proposed amendment and the possible listing of Sandy Pond on Schedule 2 of the Metal Mining Effluent Regulations (MMER) both require Governor in Council (GIC) approval in accordance with the Fisheries Act paragraph 36(5)(a) to (e).

Aspects of the development proposal anticipated to result in a HADD include the infilling and dredging in the marine environment for the wharf expansion; the construction of the intake, possible damming, and subsequent drawdown of Rattling Brook Big Pond; the construction of the dam(s) on Sandy Pond and an unnamed pond to be used as a clarification pond; infilling of ponds for the plant construction, the construction of a marine outfall, stream diversions to accommodate onsite infrastructure, and construction of stream crossing structures for roads and pipelines. - 3 -

TC has determined that several aspects of the development are anticipated to require a Navigable Waters Protection Act section 5(1)(a) approval to allow for an interference to navigation. Aspects of the development proposal anticipated to require a NWPA approval include the construction and operation of the dam(s) on Sandy Pond, the wharf expansion, marine outfall and water intake structure on Rattling Brook Big Pond. Also, TC has determined that construction and operation of the wharf expansion in Long Harbour may require a waterlot lease from the Harbours and Ports Branch of Transport Canada because Long Harbour is a federally administered harbour.

As the requirement to issue a sub-section 35(2) Fisheries Act Authorization; amend the MMER to add Sandy Pond to Schedule 2 under the Fisheries Act paragraph 36(5)(a) to (e); and issue NWPA 5(1)(a) approval are law list triggers under CEAA, an environmental assessment must be completed prior to these activities occurring.

Involvement of Other Federal Authorities

Environment Canada (EC), Natural Resources Canada (NRCan), and Health Canada (HC) will provide specialist or expert information and knowledge in support of the environmental assessment process.

Canada-Newfoundland and Labrador EA Harmonization

The development proposal is subject to a provincial environmental assessment in accordance with the Newfoundland and Labrador Environmental Protection Act. The federal environmental assessment will be coordinated, to the extent possible, with the provincial environmental assessment. However, the federal and provincial governments will each make decisions on matters within their own legislative authorities.

A document outlining the information that the Proponent must provide, as part of the provincial environmental assessment, was released for public review on September 6, 2006. It is entitled “Guidelines for both the Environmental Impact Statement (pursuant to Part X of the Environmental Protection Act) and the Federal Environmental Assessment (pursuant to the Canadian Environmental Assessment Act) Long Harbour Commercial Nickel Processing Plant (Placentia Bay, Newfoundland and Labrador).” The document can be viewed at http://www.env.gov.nl.ca/env/Env/EA%202001/Project%20Info/1243.htm Information provided by the Proponent (i.e. in the EIS) will be used as part of both the provincial environmental assessment process, and the federal environmental assessment process.

Scope of the Project for the Federal Environmental Assessment

Under CEAA, a project is defined as a) in relation to a physical work, any proposed construction, operation, modification, decommissioning, abandonment or other undertaking in relation to that physical work, or - 4 -

(b) any proposed physical activity not relating to a physical work that is prescribed or is within a class of physical activities that is prescribed pursuant to regulations made under paragraph 59(b).

The construction of the water intake, dams, outfall, and stream crossing structures (i.e. bridge, culvert, etc.) are physical works under CEAA. The infilling of the marine environment for the wharf, infilling of ponds for the plant construction, and dredging of the marine environment, are physical activities included under section 43 of the Inclusion List Regulations. Drawdown of Rattling Brook Big Pond is a physical activity included under section 44 of the Inclusion List Regulations, and the designation of a TIA and deposition of effluent into Sandy Pond and the unnamed clarification pond is a physical activity included under section 47 of the Inclusion List Regulations.

Section 43 of these regulations state:

The harmful alteration, disruption or destruction of fish habitat by means of physical activities carried out in a water body, including dredge or fill operations, that require the authorization of the Minister of Fisheries and Oceans under subsection 35(2) of the Fisheries Act or authorization under regulations made by the Governor in Council under that Act.

Section 44 of the Regulations state:

The harmful alteration, disruption or destruction of fish habitat by means of draining or altering the water levels of a water body that require the authorization of the Minister of Fisheries and Oceans under subsection 35(2) of the Fisheries Act or authorization under regulations made by the Governor in Council under that Act.

Section 47 of the Regulations state:

The deposit of a deleterious substance that requires authorization under regulations made by the Governor in Council pursuant to subsection 36(5) of the Fisheries Act.

As such, these works and activities are projects under CEAA and as they are not listed on the Exclusion List Regulations, an EA is required.

DFO has determined that aspects of the development proposal are likely to result in a HADD and therefore require the issuance of a subsection 35(2) Fisheries Act Authorization. Designation of a Tailings Impoundment Area (TIA) under the MMER will require amendments to the regulations and approval by GIC in order to list Sandy Pond under Schedule 2 of the MMER as per paragraph 36(a) to (e) of the Fisheries Act.

TC has determined that aspects of the development proposal are likely to result in an interference to navigation and thus require a subsection 5(1) approval under the Navigable Waters Protection Act. Also, construction and operation of the wharf expansion in Long Harbour may require a waterlot lease from the Harbours and Ports Branch of Transport Canada because Long Harbour is a federally administered harbour.

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As such, the federal scope of the project in relation to the Commercial Nickel Processing Plant, Long Harbour, Newfoundland and Labrador includes the following:

• Construction and operation of the wharf expansion (including infilling and dredging); the dam and intake in Rattling Brook Big Pond; the dam(s) on Sandy Pond and the unnamed pond, the outfall in the marine environment; and the stream crossing structures; • Drawdown of Rattling Brook Big Pond/Rattling Brook as a result of water extraction; • Deposition of residue in Sandy Pond; • Use of the unnamed pond as a clarification pond; • Infilling of several unnamed ponds; • Diversion of a portion of the watershed

DFO will work with TC to conduct a single federal environmental assessment screening report that will allow both RAs to fulfill their respective responsibilities under CEAA.

Factors to be Considered in the Federal Environmental Assessment

The factors to be considered in the screening, pursuant to Section 16 of CEAA, are the following: • the environmental effects of the project, including the environmental effects of malfunctions or accidents that may occur in connection with the project and any cumulative environmental effects that are likely to result from the project in combination with other projects or activities that have been or will be carried out; • the significance of the environmental effects referred to above; • comments from the public that are received in accordance with this Act and the regulations; • measures that are technically and economically feasible and that would mitigate any significant adverse environmental effects of the project.

As defined under S. 2(1) of the CEAA, “environmental effect” means, in respect of a project: a) any change that the project may cause in the environment, including any change it may cause to a listed wildlife species, its critical habitat or the residences of individuals of that species, as those terms are defined in subsection 2(1) of the Species at Risk Act b) any effect of any change referred to in paragraph (a) on i) health and socio-economic conditions ii) physical and cultural heritage iii) the current use of lands and resources for traditional purposes by aboriginal persons, or iv) any structure, site or thing that is of historical, archaeological, paleontological or architectural significance, or c) any change to the project that may be caused by the environment

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Any change to the project that may be caused by the environment

In relation to c) above, environmental effects, specifically effects of the environment on the project, could occur as a result of such things as: • geological events (e.g., seismic activity); • icing and winter conditions; • erosion, fire, flooding; and The environmental hazards that may affect the project will be described and the predicted effects of these environmental hazards will be documented.

It is important to note that the following effects, in relation to b) above, can only be considered when they relate to a change in the environment: health and socio-economic conditions; physical and cultural heritage; the current use of lands and resources for traditional purposes by aboriginal persons; and any structure, site or thing that is of historical, archaeological, paleontological or architectural significance.

Alternatives

In addition, because of the requirement for an MMER amendment under the Hydromet option, the screening EA will also include a detailed and thorough analysis of alternatives to deposition of waste residue underwater in Sandy Pond (i.e. alternatives to regulation). This will include an analysis of the technical, environmental and socio- economic feasibility associated with underwater deposition/storage options versus land based storage options. The analysis should also offer an explanation of why these alternatives were chosen or disqualified (e.g. feasibility, cost, etc.).

Malfunctions and Accidents

The probability of possible malfunctions or accidents associated with the project, and the potential adverse environmental effects of these events, will be identified and described.

Cumulative Environmental Effects

The cumulative environmental effects that are likely to result from the project in combination with other projects or activities that have been or will be carried out will be identified and assessed. The cumulative effects assessment will take into consideration, effects related to components of the development proposal that are not included in the scope of project (e.g., process buildings, storage buildings, admin. buildings etc).

Scope of the Factors to be Considered in the Federal Environmental Assessment

The following provides details on the proposed scope of the factors to be considered in the environmental assessment.

Physical and Natural Environment - 7 -

• water quality (freshwater and marine); • hydrology and water resources; • species at risk; • freshwater and marine fish and fish habitat

Socio-Economic and Cultural Environments • resource use (fisheries, recreational boating); • navigation (including human health and safety) • marine safety and security

Temporal and spatial boundaries will be determined for the proposed scope of the factors early in the assessment. Temporal boundaries refers to the determination of the time period during which factors are likely to be impacted by the project (e.g., during the construction phase). Spatial boundaries refer to the determination of the geographical area within which factors are likely to be impacted by the project (e.g. footprint of a building). The study area for the environmental assessment should encompass the area within which all of the proposed scope of the factors are likely to be impacted.

Public Participation under 18(3) of CEAA

In accordance with subsection 18(3) of CEAA, this scoping document will be made available to the public via the http://www.ceaa-acee.gc.ca/050/index_e.cfm internet site. The scoping document provides the public with a description of the scope of project, the factors to be taken into consideration in the federal screening EA and the scope of those factors. The public will also have an opportunity to examine and comment on the final draft of the screening report, once it is ready.

Public Participation during Governor-in-Council (GIC) Approval of MMER Amendment

Public Consultation will also be conducted as part of the Regulatory Impact Analysis Statement (RIAS) requirements in order to seek GIC approval.

Canadian Environmental Assessment Registry (CEAR)

Pursuant to the Act, section 55, a CEAR has been established to provide notice of the environmental assessment, and facilitate public access to records related to the environmental assessment. The CEAR consists of a project file and an internet site. The internet component of the CEAR can be accessed at http://www.ceaa- acee.gc.ca/050/index_e.cfm Anyone wishing to obtain copies, or view records, from the CEAR project file should contact Habitat Management Program, Fisheries and Oceans at [email protected] or 709-722-4912.

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Figure 1 - Map of Development Proposal (extracted from Voisey’s Bay Nickel Company Project Description and Project Registration for a Commercial Processing Plant, March 16, 2006).