Mr. Brian Kynoch reports

IMPERIAL METALS CORPORATION: REPORT BY THE MOUNT POLLEY INDEPENDENT EXPERT ENGINEERING INVESTIGATION AND REVIEW PANEL

The Mount Polley independent expert engineering investigation and review panel has released its report on the cause of the Aug. 4, 2014, tailings storage facility (TSF) breach at Imperial Metals Corp.'s Mount Polley mine.

The panel's determination of the cause of the breach is in agreement with the results of the investigation of mine operator Mount Polley Mining Corp. (MPMC). The panel found no evidence of failure due to human intervention, overtopping, or piping and/or cracking resulting in internal erosion. The panel indicated that the water accumulation within the TSF was not a cause of failure but contributed to the release of tailings. The company had earlier recognized that water levels would increase in the TSF, and had taken steps commencing in 2006 to address this issue.

The panel concluded that the perimeter embankment of the TSF failed because a glacio-lacustrine layer (GLU) lying approximately eight metres below the base of the dam in the area of the breach was not as strong as had been assumed in the design of the TSF.

Construction over the 18-year life of the TSF was at all times carried out in accordance with design criteria provided by the engineers of record and approved by the Ministry of Energy and Mines (MEM). The panel noted that the omissions associated with site characterizations remained undetected notwithstanding the large number of experienced geotechnical engineers associated with the TSF over the years.

Design criteria accepted for the TSF required a factor of safety of 1.3 during the operating life of the mine, increasing to 1.5 at closure. Based on the calculations presented in the design reports, the factor of safety of the perimeter embankment where the failure occurred exceeded 1.5 at the time of failure.

The panel stated in its report that it "considers the technical qualifications of the MEM geotechnical staff as among the best that it has encountered among agencies with similar duties." MEM's Sept. 13, 2013, geotechnical inspection report to MPMC stated that "based on our observations and information reviewed, we consider that the TSF is being designed, constructed and operated in general conformance with the requirements of the geotechnical components of the (health, safety and reclamation code), permit M-200, and accepted engineering practices." The ministry observed that a quality control/quality assurance program was in place, and considered MPMC's revised operations, maintenance and surveillance manual to be well thought out.

In summary, the TSF was constructed in accordance with design criteria established by the engineers of record and accepted by the MEM. Had the GLU beneath the TSF been as strong as assumed by design criteria, this sudden and unanticipated failure would not have occurred.

The company continues to make good progress in repairing the effects of the breach, working closely with the Ministry of Environment in co-operation with first nations and local communities.