A Method for Estimating the Potential Trading of Worked Water among Multiple Mines

In many parts of the world, mine production and expansion are increasingly limited by access to water. One solution is to consider a water market that would allow trading of mine site water (worked water) from wetter mines to drier mines. However, there is currently no policy support for such a market and it is likely that without government support via incentives, mines will continue to favour freshwater use because it is relatively inexpensive. Furthermore, mines have a high capacity to pay for the water they use, and freshwater creates few risks for production. The opportunity provided by water savings within a trading scheme could be viewed as a source of money to provide incentives for the transfer of worked water between mines. In this paper, we present a new method to trade water among mines based on a site water balance assessment utilising historical climate data, and apply this method to a demonstration region containing multiple coal mines. On average, 340 ML could be transferred per year to drier mines but there remains 11,440 ML per year of water demand unable to be met by trading. The direct monetary value of the worked water that could be transferred, derived from additional coal mining, would be significant. Irrigation may be an attractive option if available infrastructure can be used to trade the saved fresh water in existing markets, thereby providing indirect monetary value (i.e. external to coal production). Alternative uses of water savings may have considerable additional non-monetary value that directly affects the mining industry’s social license-to-operate and its security of long term water supply.