Appendix L-Receipt by DEMLR - Request for Declaratory Ruling

BEFORE THE ENVIRONMENTAL MANAGEMENT COMMISSION
ILUKA RESOURCES, INC., ) REQUEST FOR DECLARATORY
RULING
Petitioner. )
Pursuant to N.C. Gen. Stat. § 150B-4 and 15A N.C. Admin. Code 2I.0601, Iluka
Resources (NC) LLC ("Iluka") submits this request to the North Carolina Environmental
Management Commission ("Commission") for a declaratory ruling regarding the application of
the Dam Safety Law to Iluka's planned Aurelian Springs Mineral Sands Mine. In support of this
request, Iluka submits the following information:
1. Name and Address of Petitioner
Iluka Resources (NC) LLC.
413 Becker Drive
Roanoke Rapids,NC 27870
2. The Statute Upon Which a Ruling is Desired
N.C. Gen. Stat. § 143-215.25A
3. A Concise Statement as to Whether the Request is for a Ruling on the Validity of a Rule
or on the Applicability of a Rule, Order or Statute to a Given Factual Situation
Iluka is requesting a declaratory ruling on the applicability of§ 143-215.25A(a)(6) to
dams that will be built at the planned Aurelian Springs Mineral Sands Mine in Halifax County,
North Carolina. Specifically, Iluka seeks a determination of whether the dams are exempt from
the requirements of the Dam Safety of Law of 1967,N.C. Gen. Stat. § 143-215.23 et seq. (the
"Dam Safety Law") or whether it must submit an application to the Department of Environment
and Natural Resources (the "Department") before beginning construction.
RECEIVED
M Y�0 6 2014
DEi4R-D�MLR

a. Legal Background
The Dam Safety Law was enacted"to reduce the risk of failure of dams; to prevent
injuries to persons, damage to downstream property and loss of reservoir storage; and to ensure
maintenance of minimum stream flows of adequate quantity and quality below dams." N.C.
Gen. Stat. § 143-215.24. "When viewed in context, it is clear that the evils which the act seeks
to prevent are evils which ensue from dam failure." Wells v. Benson, 253 S.E.2d 602, 605 (N.C.
Ct. App. 1979). Consistent with that purpose,N.C. Gen. Stat. § 143-215.25A(a) lists seven
categories of dams that are exempt from the Dam Safety Law's requirements. For this request,
two of those exemptions are relevant: (1) Subsection(a)(5) exempts any dam that is "[u]nder a
single private ownership that provides protection only to land or other property under the same
ownership and that does not pose a threat to human life or property below the dam;" and(2)
Subsection(a)(6) exempts any dam "[t]hat is less than 25 feet in height or that has an
impoundment capacity of less than 50 acre-feet, unless the Department [of Environment and
Natural Resources] determines that failure of the dam could result in loss of human life or
significant damage to property below the dam."
The Dam Safety Law is implemented through regulations located at 15A N.C. Admin.
Code Chapter 2K, Section .0100. The regulations provide instructions for measuring a dam as
follows:
(a) For the purpose of determining size classification, the height of
a dam shall be measured from the highest point on the crest of the
dam to the lowest point on the downstream toe.
(b) The total storage capacity of a dam shall be that volume which
would be impounded at the elevation of the highest point on the
crest of the dam.
15A N.C. Admin. Code 2K.0223.
2

b. Statement of Facts'
The Aurelian Springs Mineral Sands Mine will involve the excavation of titanium and
zircon mineral sands through pit mining on land leased, and not owned,by Iluka. As the mineral
sands are excavated, they will be processed to remove the valuable minerals. The remaining
"tailings," consisting of clay, quartz sands, and gravel, will be sluiced back into the pit, where
they will settle and be dewatered. At the completion of the mining process, the pit will be filled
with this material, and the mined area will be near its original grade.
Because Iluka will be mining and producing tailings at the same time, it intends to
construct dams within the pit to isolate sections that can be used as active tailings ponds while
mining takes place elsewhere. The amount of water contained in a particular tailings pond will
always be less than the total volume of the pit, so, for a dam facing the open pit, failure would
result only in water and tailings being dispersed in the pit.2 The height of a dam from the bottom
of a pit to the crest of the dam will, in some cases, exceed 25 feet in height, and the
impoundment capacity, calculated using the distance from the bottom of the pit to the crest of the
dam, will exceed 50 acre-feet.
At times, there will be employees working in the portions of the pit. In order to protect
the employees from the risk of a dam failure, there will always be a second dam between the
employees and the active tailings ponds. This will ensure that there is always an empty chamber
between the active tailings pond and the employees. As a result, a failure of the dam on the
active tailings pond would only result in water entering the empty chamber and reaching the
second dam; it would not result in water entering the chamber where the employees are working.
1 The facts stated here reflect Iluka's plans for construction and operation of the mine. Iluka fully intends
to comply with all applicable laws,regulations,and permits and will adjust its plans as necessary in the future to do
so.
2 The pit will also involve dams along the perimeter of the pit,the purpose of which will be to keep water
from leaving the pit. Iluka is not seeking a declaratory ruling with respect to these dams.
3

Additionally, whenever employees are required to work in the pit, daily safety inspections will
be made of the dam.
DAM CREST
PIT CREST I
ACTIVE TAILINGS PIT OPEN PIT EMPLOYEES IN IT
a
0
c. Application of Law to State of Facts
Iluka requests that the Commission determine the applicability of N.C. Gen. Stat. §§ 143-
215.25A(a)(5) and (6) as follows:
i. N.C. Gen. Stat. §§ 143-215.25A(a)(5)
This exemption applies to dams with three characteristics: (1) single private ownership,
(2)providing protection to land or other property under the same ownership, and(3) do not pose
a threat to human life or property below the dam. The dams described above will meet the first
characteristic. For the second characteristic, the dams do not provide protection to land or other
property. Unlike a more traditional in-stream dam, these dams do not retain water upstream that
could, in the case of a dam failure, travel off-site to affect downstream property owners. Their
purpose is not to protect downstream property from the possibility of flooding. Rather, their
purpose is to segment the mining pit for different uses, to facilitate the disposal of mine tailings,
and to speed mine reclamation. The failure of one of these dams would result only in water and
tailings being distributed into an adjacent cell of the pit. The only harm would be to hamper
mining operations. On the third characteristic, as already stated, the dams do not pose a threat to
4

property below the dam. In the absence of appropriate safety measures, they could pose a threat
of harm to human life, based on the risk to employees working in the pit. However, as long as
employees are separated from every active tailings pit by an empty cell of appropriate size, that
threat is eliminated.3 Accordingly, a dam constructed for a tailings impoundment contained
entirely within a mining pit, and which is separated from employees by another dam, is properly
classified as a dam that is "[u]nder a single private ownership that provides protection only to
land or other property under the same ownership and that does not pose a threat to human life or
property below the dam."
ii. N.C. Gen. Stat. §§ 143-215.25A(a)(6)
This exemption applies when(1) the Department has not determined that failure of a dam
could result in loss of human life or significant damage to property below the dam and(2) either
of the other two conditions are met: (a)the dam is less than 25 feet in height or(b) it has an
impoundment capacity of less than 50 acre feet. In effect, this exemption applies to smaller
dams for which the consequences of dam failure are low.
In the context of a pit mine, the term"impoundment capacity"has a different connotation
than it would in the context of a riverine dam or surface waste impoundment. In a pit mine,
water is impounded by the pit itself. Were there no dam, the water would still be contained
within the pit. The dam's function is not to hold back water that would otherwise rush off-site
but to segregate a portion of the pit for use as an active tailings pond. The dam only functions
like a traditional dam if it creates impoundment capacity above that of the pit itself. Thus, for a
dam located in a pit mine, the impoundment capacity attributed to the dam should not include
3 The risk that the second dam would also fail could be considered in this analysis if the failure of the first
dam were likely to cause the second dam to fail. See 15A N.C.Admin.Code.2K.0105(e)("When dams are spaced
so that the failure of an upper dam would likely fail a lower dam,the consequence of the lower dam's failure shall be
a determining factor for the upper dam's hazard classification.") However,the risk of a second dam failure can be
excluded if the failure of the upper dam is not likely to cause the failure of the lower dam.
5

capacity that is attributable to the pit. That is, it should be calculated using the distance from the
pit crest to the top of the dam. In the figure below, if water were impounded to the right side of
the dam, the impoundment capacity would be "Volume A."
WATER/SILT LEVEL
LOWEST PC NT ON -
MCREST
VOLUME- - ---
IIJ--sn GROUND
When the volume calculated in this fashion is less than 50 acre-feet, a dam may still be
regulated if the Department determines that it poses a threat to human life or property below the
dam. For reasons stated above,the dams at issue here do not pose a risk to human life or
property.
4. Arguments or Data which Demonstrate that the Petitioner is Aggrieved by the Rule or
Statute or its Potential Application to Him/Statement of the Consequences of a Failure
to Issue a Declaratory Ruling in Favor of the Petitioner
Iluka is entitled to seek a declaratory ruling pursuant to N.C. Gen. Stat. § 150B-4 because
it is a"person aggrieved." A "person aggrieved" is "any person or group of persons of common
interest directly or indirectly affected substantially in his or its person, property, or employment
by an administrative decision." N.C. Gen. Stat. § 150B-2(6). Here, Iluka is adversely affected
because it has proposed to construct dams as described in the Statement of Facts above and has
been told by a representative of the Department that such dams are not exempt from the Dam
6

Safety Law. Because of this, Iluka must either change its plans and build smaller dams or submit
an application to the Department before beginning construction. Because Iluka must make
decisions now about future operations as it prepares an application for a mining permit, the
interpretation of the statutory exceptions has a current adverse impact. (Ex. A.)
Iluka first submitted a proposal for the construction of dams to the Department on May
31, 2013, in a document titled "Draft Impoundment Design Guidelines." (Ex. A-1.) The
Department responded with comments dated June 27, 2013, in which it indicated where Iluka
should make changes to the proposal. (Ex. A-2.) Iluka met with Department staff on July 26,
2013. Iluka submitted a second proposal on September 9, 2013. (Ex. A-3.) The Department
again responded with comments (Ex. A-4) and provided a separate document for determining
when dams would be regulated (Ex. A-5). According to the second document, "[v]olume
calculations will be from the lowest in-situ ground point to the maximum pool level within the
impoundment as defined by the crest elevation of the containment dike." (Id. (emphasis in the
original).)
Based on this correspondence, Iluka understands the Department's position to be that the
two statutory exemptions do not apply to the dams described above and that when Iluka files its
statement concerning the height, impoundment capacity,purpose, location and other information,
as required by N.C. Gen. Stat. § 143-215.26,the Department will require Iluka to submit an
application before constructing the dams as proposed.
5. A Draft of the Proposed Ruling
1. A dam constructed for the purpose of creating a tailings pond within a mine pit is exempt
from the Dam Safety Law pursuant to 143-215.25A(a)(5) as a dam that is under a single
private ownership that provides protection only to land or other property under the same
ownership and that does not pose a threat to human life or property below the dam under
the following circumstances: (1) were the dam to fail, all contents of the tailings pond
would be contained within the pit, and (2) the Department has determined that the failure
of the dam would not pose a threat to human life below the dam.
7

2. A dam constructed for the purpose of creating a tailings pond within a mine pit is exempt
from the Dam Safety Law pursuant to 143-215.25A(a)(6) under the following
circumstances: (1) the impoundment capacity attributable to the dam, calculated using
the distance from the pit crest to the crest of the dam, is less than 50 acre-feet, and (2) the
Department has determined that the failure of the dam would not pose a threat to human
life below the dam.
6. A Statement of Whether an Oral Argument is Desired, and, if so,the Reason(s) for
Requesting Such an Oral Argument
Iluka requests the opportunity to present oral argument for the purpose of providing
additional detail about its plans for the Aurelian Springs Mineral Sands Mine and addressing any
questions the Commission has regarding how the dams will be situated and operated.
Respectfully submitted, this the 22nd day of April, 2014.
HUNTON & WILLIAMS LLP
&4,w -1. /4
Matthew F. Hanchey
N.C. Bar# 33965
PO Box 109
Raleigh,NC 27602
[phone]
[e-mail]
8

t
BEFORE THE ENVIRONMENTAL MANAGEMENT COMMISSION
ILUKA RESOURCES (NC) LLC )
Petitioner. )
AFFIDAVIT OF CHARLES STILSON
1. My names is Charles Stilson. I am the Project Manager for Iluka Resources (NC)
LLC ("Iluka") on the Aurelian Springs Mineral Sands Mine. I have worked for Iluka and its
affiliates for fourteen years. In that time, I have held the positions of mine engineer, senior mine
engineer, technical manager and mine manager. I am a registered professional engineer in the
State of Virginia.
2. Iluka has a record of sustainability and environmental stewardship at its mining
operations, including its Old Hickory and Concord sites in Sussex County, Virginia and its Brink
site in Greensville County, Virginia. Iluka is committed to full compliance with all applicable
laws and regulations, as well as to open and meaningful engagement with stakeholders. Iluka
has already begun to engage with stakeholders in Halifax County.
3. In accordance with North Carolina's mining laws and regulations, Iluka must
obtain a mining permit before it can begin mining operations at Aurelian Springs. By regulation,
an application for a mining permit must include the following information: (1) size of the mine,
including acreage for tailings ponds; (2) measures to be taken to insure against landslides; (3) a
reclamation plan, including the general methods to be used in reclamation and methods for
rehabilitating settling ponds. 15A N.C. Admin. Code 0513.0104(a) & (b).

4. In order to prepare a mining permit application and reclamation plan, Iluka must
make a preliminary determination of the location and size of dams that it will construct for the
purpose of sectioning portions of the mining pit for the storage of mine tailings. The size and
number of dams within the pit will affect the acreage of tailings ponds. Additionally, redeposit
of tailings in the pit and grading of topsoil from the dams on top of the mine tailings will be part
of the reclamation plan. Throughout the mining process, Iluka's ability to proceed with mining
and reclamation will depend on whether the necessary dams are in place.
5. The number and size of the dams used will depend in part on whether Iluka must
obtain permits, due to the cost and time required to obtain a permit. Further, Iluka's operations
plan will depend in part on the flexibility it has to construct new dams as necessary to adapt to
site conditions.
6. As a result, Iluka is currently making decisions that will affect the efficiency of its
operations throughout the life of the project.
7. In preparing to submit its mining permit application, Iluka has engaged in
preliminary discussions with the Department of Environment&Natural Resources Division of
Energy, Mineral and Land Resources, including staff from the Mining Program, the Erosion and
Sedimentation Program, and the Dam Safety Program. The exhibits attached to this affidavit are
2

true and correct copies of correspondence exchanged between Iluka and the Division of Energy,
Mineral and Land Resources.
Executed this Z2 day of April, 2014.
r
Charles Stilson
STATE OF
COUNTY OF O-PO )
Signed and sworn to before me this day by Charles Stilson.
Date: �7 A Qc�\A
Official Signature of tary
r& Q-�4— b , Notary Public
Printed Nam f Wotary
My Commission Expires:
'.;; LINDA SUE NYBORG
[Official Seal or Stamp] ; � Notary Public, North Carolina
y, Halifax County
My7 Con Ex Tres
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3
52779.000027 EMF_US 50455589v2

Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
Draft Impoundment Design Guidelines
Guidelines for a typical mine tailings/reclamation impoundment are as follows:
• Typical impoundment areas vary from 2 to 7 acres in size.
• Constructed outer embankment walls will have side slopes of 2:1 with a top width of 15
feet.
• One foot of freeboard between the water or slurry surface and top of embankment will be
maintained at all times.
Embankments will be monitored and surveyed during construction to ensure that approved
slope angles and dimensions are met.
Embankment footprints will be inspected prior to construction. Where seeps are evident, a
blanket or toe drain will be installed to transport water away from the toe area. On the surface,
positive drainage will be maintained to drain runoff away from toe areas.
The criteria listed below are to serve as design guidelines that will ensure that impoundments
are constructed such that they are below the G.S 143-215.25A size criteria. In the future if it is
found that these criteria do not provide definitive guidance, they may have to be altered as
agreed to by the NCDENR Division of Energy, Mineral and Land Resources and Iluka
Resources, Inc. (Iluka).
G.S 143-215.25A(6) applies to impounding structures less than 25 feet in height or that have an
impoundment capacity of less than 50 acre-feet, unless the Department determines that failure
of the dam could result in loss of human life or significant damage to property below the dam.
A minimum of at least 2 feet of freeboard will be maintained for surface impoundments unless
open channel spillways are provided. In lieu of open channel spillways, the freeboard for
surface impoundments may be reduced to 1 foot if weirs and trash racks designed to handle a
50-year storm event are part of the surface impoundment design. The design for each surface
impoundment required at the facility will be developed based on the site-specific conditions and
material availability.
Waste material tailings of clay, quartz sands and gravel will serve as backfill for the mine cells,
mimicking pre-mining topographic features. After being pumped back to the mined-out cells, the
tailings are allowed to settle and dewater. The topsoil containment berms will then be graded
across the mined areas as top dressing for the final reclamation contouring. Due to the high clay
content of the ore, the final grades of some reclamation areas might be approximately 20% to
30% higher than the pre-mining contours.
General
For the purpose of this text, "in-situ ground" is understood to be unmined ground or undisturbed
ground below an excavation. The integrity of in-situ ground shall not be disturbed by excavation,
backfilling or scarification (except for keyway cuts).
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Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
Documents titled "Form to determine if a dam is governed by the Dam Safety Law of 1967" and
the "Dam Hazard Classification Form" will be submitted to the NC Dam Safety Program in order
to receive approval that a dam safety permit is not required.
Impoundment Construction Sequence
Whenever practical, impoundments will be constructed such that impoundments at lower
elevations are constructed first. This will not always be practical, and impoundments may be
constructed in any sequence. Regardless of constructions sequence, all impoundments will be
constructed according to the above-listed design criteria.
Overview
There will be three design criteria to determine if an impoundment is considered exempt. Each
impoundment will be designed and constructed in accordance with one or more of the criteria as
applicable. Diagram 1 is used to help demonstrate when the different design criteria apply to
particular structures.
Criterion 1
The first criterion is to be used when any portion of an impoundment is built on umnined ground.
In Diagram 1, this criterion would apply to:
• the north portion of Dam 1 (constructed entirely on unmined ground);
• the western portion of Dams 1 and 2 (constructed partially on unmined ground above the
pit crest and partially within the pit); and
• the eastern portion of Dams 1 and 3 (constructed partially on unmined ground above the
pit crest and partially within the pit).
Impoundments that meet the first criteria must be constructed so that they are less than 25 feet
in height and contain less than 50 acre-feet of capacity above in-situ (unmined) ground.
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Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
Diagram 1:
o�
� INSIDE
DAM 2 DAM 3
INSIDE TOE INSIDE TOE
PST
REST
For height and volume calculation purposes, the lowest in-situ ground point will be determined
as follows:
Where the inside toe of the berm falls on unmined in-situ ground, the lowest inside toe intercept
with in-site ground will be used. See magenta-shaded area of Diagram 1.
Where the inside toe of the berm falls within the mined-out pit (where the pit crest falls within the
constructed berm), the lowest point on the pit crest will be used. See green-shaded area of
Diagram 1.
For impoundments that have part of the inside toe fall on unmined ground and part of the inside
toe fall within the pit (Dam 1, for example), the lowest elevation from 1 and 2 above will be used.
Volume calculations will be from this lowest reference point to the maximum pool level within the
impoundment.
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Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
Criterion 2
The second criterion is to be used when any portion of an impoundment is shared by another,
previously constructed impoundment. This criterion applies when the proposed impoundment is
to be constructed at a higher elevation than the previously constructed adjacent impoundments.
In Diagram 1, this criterion could apply to wall of Dam 1 that abuts Dam 2 and Dam3 (assuming
that Dams 2 and 3 were constructed prior to Dam 1).
Impoundments that meet the second criteria and have dimension "A" less than or equal to 40
feet must be constructed so that dimension "B" is less than 25 feet (see Diagram 2).
Impoundment volume must be less than 50 acre-feet using the depth "B" in the calculation.
Impoundments that meet the second criteria and have dimension "A" greater than or equal to 40
feet must be constructed so that dimension "B" is less than 15 feet (see Diagram 2).
Impoundment volume must be less than 50 acre-feet using the depth "B" in the calculation.
Under no circumstances will these structures be constructed to a height of 25 feet or more
above the pre-mined natural ground elevation.
Diagram 2:
WATER/SILT LEVEL
e
WATER/SILT LEVEL A
12
IN-517U GROUND
Dimension A is the total wall height above in-situ ground. It is measured from the crest to the
lowest inside toe intercept with in-situ ground.
Dimension B is the relative difference in impoundment elevations. It is measured from the pool
elevation in the impoundment to the lowest pool elevation in any adjoining impoundment
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Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
Criterion 3
The third criterion is to be used when any portion of an impoundment is built within the pit and
the embankment faces the open pit. This criterion does not apply if the impoundment height is
less than 25 feet and total containment capacity is less than 50 acre-feet relative to the lowest
inside toe intercept with in-situ ground.
In Diagram 1, these criteria could apply to the walls of Dams 2 and 3 that abut the pit (assuming
that Dam 1 was previously constructed).
Impoundments that meet the third criteria must be constructed so that the water and tailings
volume will be completely contained within the open pit adjacent to the structure, in the event of
an impoundment failure.
For impoundment volume calculation purposes (Volume A, Diagram 3) the lowest point on the
crest of the open pit will be referenced. Containment volume (Volume 8, Diagram 3) calculations
will be the available volume below the lowest point on the crest of the open pit.
As long as the impoundment in question has an unobstructed wall that faces in the pit, adequate
volume will be maintained within the pit to contain the impounded material should failure of the
impoundment ever occur (Volume B >_ Volume A, Diagram 3).
Whenever persons are required to work on or below these impoundments, daily safety
inspections will be made of the structure.
Diagram 3:
WATER/SILT LEVEL
LOWEST POINT ON -
PIT CREST \-------------------
IN-SITU GROUND
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Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
Please see below comments from the Land Quality Section, Dam Safety Program dated
June 27, 2013.
Draft Impoundment Design Guidelines
Guidelines for a typical mine tailings/reclamation impoundment are as follows:
• Typical impoundment areas vary from 2 to 7 acres in size.
• Constructed outer embankment walls will have side slopes of 2:1 with a top width of 15
feet.
COMMENT#1: The sum of the horizontal components of the upstream and
downstream slope should be 5 (five) or greater. Base ref: NRCS Engineering
Standard 378.
• One foot of freeboard between the water or slurry surface and top of embankment will be
maintained at all times.
Embankments will be monitored and surveyed during construction to ensure that approved
slope angles and dimensions are met.
Embankment footprints will be inspected prior to construction. Where seeps are evident, a
blanket or toe drain will be installed to transport water away from the toe area. On the surface,
positive drainage will be maintained to drain runoff away from toe areas.
The criteria listed below are to serve as design guidelines that will ensure that impoundments
are constructed such that they are below the G.S 143-215.25A size criteria. In the future if it is
found that these criteria do not provide definitive guidance, they may have to be altered as
agreed to by the NCDENR Division of Energy, Mineral and Land Resources and Iluka
Resources, Inc. (Iluka).
G.S 143-215.25A(6) applies to impounding structures less than 25 feet in height or that have an
impoundment capacity of less than 50 acre-feet, unless the Department determines that failure
of the dam could result in loss of human life or significant damage to property below the dam.
A minimum of at least 2 feet of freeboard will be maintained for surface impoundments unless
open channel spillways are provided. In lieu of open channel spillways, the freeboard for
surface impoundments may be reduced to 1 foot if weirs and trash racks designed to handle a
50-year storm event are part of the surface impoundment design. The design for each surface
impoundment required at the facility will be developed based on the site-specific conditions and
material availability.
Waste material tailings of clay, quartz sands and gravel will serve as backfill for the mine cells,
mimicking pre-mining topographic features. After being pumped back to the mined-out cells, the
tailings are allowed to settle and dewater. The topsoil containment berms will then be graded
across the mined areas as top dressing for the final reclamation contouring. Due to the high clay
content of the ore, the final grades of some reclamation areas might be approximately 20% to
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Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
30% higher than the pre-mining contours.
General
COMMENT#2: Please add a definitions section to include as a minimum: 1) "in-situ
ground" (as defined below), 2) "pre-mined natural ground elevation" (obvious but please
define), 3) "downstream" (define as direction of lower adjacent impounded water/silt
levels).
For the purpose of this text, "in-situ ground" is understood to be unmined ground or undisturbed
ground below an excavation. The integrity of in-situ ground shall not be disturbed by excavation,
backfilling or scarification (except for keyway cuts).
Documents titled "Form to determine if a dam is governed by the Dam Safety Law of 1967" and
the "Dam Hazard Classification Form" will be submitted to the NC Dam Safety Program in order
to receive approval that a dam safety permit is not required.
COMMENT#3: Please also include drawing exhibits to clarify.
Impoundment Construction Sequence
Whenever practical, impoundments will be constructed such that impoundments at lower
elevations are constructed first. This will not always be practical, and impoundments may be
constructed in any sequence. Regardless of constructions sequence, all impoundments will be
constructed according to the above-listed design criteria.
Overview
There will be three design criteria to determine if an impoundment is considered exempt. Each
impoundment will be designed and constructed in accordance with one or more of the criteria as
applicable. Diagram 1 is used to help demonstrate when the different design criteria apply to
particular structures.
Criterion 1
The first criterion is to be used when any portion of an impoundment is built on umnined ground.
In Diagram 1, this criterion would apply to:
• the north portion of Dam 1 (constructed entirely on unmined ground);
• the western portion of Dams 1 and 2 (constructed partially on unmined ground above the
pit crest and partially within the pit); and
• the eastern portion of Dams 1 and 3 (constructed partially on unmined ground above the
pit crest and partially within the pit).
Impoundments that meet the first criteria must be constructed so that they are less than 25 feet
in height and contain less than 50 acre-feet of capacity above in-situ (unmined) ground.
COMMENT#4: This conclusion is valid provided the dam is not of high hazard
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Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
classification as defined by 15A NCAC 2K .0105 or .0211. High hazard dams are
jurisdictional regardless of dam height or impoundment capacity. The dam and reservoir
must meet both conditions (25 feet in height and contain less than 50 acre-feet of
capacity at top of dam elevation) to be jurisdictional if it is not of high hazard
classification. This of course will depend on the mining area location. As for an
immediate case, if mining personnel are operating in the pit on the downstream side of a
containment dam built within the pit, then the containment dam is high hazard until
mining personnel are no longer required to work in the pit. For this reason, construction
of the containment dam will require approval under the NC Dam Safety Law of 1967.
Diagram 1:
o DAM 1
O�
O
�Jn1oEJoE___
................
..:°R .:°' DAM 3
1...............
.......',.........
.
..
Pir
BEST
For height and volume calculation purposes, the lowest in-situ ground point will be determined
as follows:
Where the inside toe of the berm falls on unmined in-situ ground, the lowest inside toe intercept
with in-site ground will be used. See magenta-shaded area of Diagram 1.
Where the inside toe of the berm falls within the mined-out pit (where the pit crest falls within the
constructed berm), the lowest point on the pit crest will be used. See green-shaded area of
Diagram 1.
For impoundments that have part of the inside toe fall on unmined ground and part of the inside
toe fall within the pit (Dam 1, for example), the lowest elevation from 1 and 2 above will be used.
Volume calculations will be from this lowest reference point to the maximum pool level within the
impoundment.
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Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
Criterion 2
The second criterion is to be used when any portion of an impoundment is shared by another,
previously constructed impoundment. This criterion applies when the proposed impoundment is
to be constructed at a higher elevation than the previously constructed adjacent impoundments.
In Diagram 1, this criterion could apply to wall of Dam 1 that abuts Dam 2 and Dam3 (assuming
that Dams 2 and 3 were constructed prior to Dam 1).
Impoundments that meet the second criteria and have dimension "A" less than or equal to 40
feet must be constructed so that dimension "B" is less than 25 feet (see Diagram 2).
Impoundment volume must be less than 50 acre-feet using the depth "B" in the calculation.
Impoundments that meet the second criteria and have dimension "A" greater than or equal to 40
feet must be constructed so that dimension "B" is less than 15 feet (see Diagram 2).
Impoundment volume must be less than 50 acre-feet using the depth "B" in the calculation.
Under no circumstances will these structures be constructed to a height of 25 feet or more
above the pre-mined natural ground elevation.
Diagram 2:
WATER/SILT LEVEL
B
WATER/SILT LEVEL A
IN-SITU GROUND
COMMENT#5: The height of the dam in accordance with 15A NCAC 2K 0.223 would be
the "A" dimension as measured on the downstream (left in this diagram) side of the
containment dam. Computation of impoundment capacity is to be computed from the
in-situ ground surface to top of dam.
Dimension A is the total wall height above in-situ ground. It is measured from the crest to the
lowest inside toe intercept with in-situ ground.
Kleinfelder Southeast, Inc. Page 4 of 6 May 31, 2013

Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
Dimension B is the relative difference in impoundment elevations. It is measured from the pool
elevation in the impoundment to the lowest pool elevation in any adjoining impoundment
Criterion 3
The third criterion is to be used when any portion of an impoundment is built within the pit and
the embankment faces the open pit. This criterion does not apply if the impoundment height is
less than 25 feet and total containment capacity is less than 50 acre-feet relative to the lowest
inside toe intercept with in-situ ground.
In Diagram 1, these criteria could apply to the walls of Dams 2 and 3 that abut the pit (assuming
that Dam 1 was previously constructed).
Impoundments that meet the third criteria must be constructed so that the water and tailings
volume will be completely contained within the open pit adjacent to the structure, in the event of
an impoundment failure.
For impoundment volume calculation purposes (Volume A, Diagram 3) the lowest point on the
crest of the open pit will be referenced. Containment volume (Volume 8, Diagram 3) calculations
will be the available volume below the lowest point on the crest of the open pit.
As long as the impoundment in question has an unobstructed wall that faces in the pit, adequate
volume will be maintained within the pit to contain the impounded material should failure of the
impoundment ever occur (Volume B >_ Volume A, Diagram 3).
Whenever persons are required to work on or below these impoundments, daily safety
inspections will be made of the structure.
Diagram 3:
WATER/SILT LEVEL
LOWEST POINTON _-_-_-_F VOLUME A -_-
PIT CREST
-------------------
-------------------
-------------------
-----------------------------------------
-----------------------------------------
-----------------------------------------
------------------------------------------
------------------ VO -------------------
_7... -------------------
IN-SITU GROUND
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Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
COMMENT#6: if mining personnel are operating in the pit on the downstream side of a
containment dam built within the pit, then the containment dam is high hazard until
mining personnel are no longer required to work in the pit. For this reason, construction
of the containment dam will require approval under the NC Dam Safety Law of 1967.
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Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
Draft Impoundment Design Guidelines
Guidelines for a typical mine tailings/reclamation impoundment are as follows:
• Typical impoundment areas vary from 2 to 7 acres in size.
• Constructed outer embankment walls will have side slopes of 2.5:1 with a top width of 15
feet.
• One foot of freeboard between the water or slurry surface and top of embankment will be
maintained at all times.
• Slopes will be tracked and compacted to prevent rilling or other erosion.
Embankments will be monitored and surveyed during construction to ensure that approved
slope angles and dimensions are met.
Embankment footprints will be inspected prior to construction. Where seeps are evident, a
blanket or toe drain will be installed to transport water away from the toe area. On the surface,
positive drainage will be maintained to drain runoff away from toe areas.
The criteria listed below are to serve as design guidelines that will ensure that impoundments
are constructed such that they are below the G.S 143-215.25A size criteria. In the future if it is
found that these criteria do not provide definitive guidance, they may have to be altered as
agreed to by the NCDENR Division of Energy, Mineral and Land Resources and Iluka
Resources, Inc. (Iluka).
G.S 143-215.25A(6) applies to impounding structures less than 25 feet in height or that have an
impoundment capacity of less than 50 acre-feet, unless the Department determines that failure
of the dam could result in loss of human life or significant damage to property below the dam.
A minimum of at least 2 feet of freeboard will be maintained for surface impoundments unless
open channel spillways are provided. In lieu of open channel spillways, the freeboard for
surface impoundments may be reduced to 1 foot if weirs and trash racks designed to handle a
50-year storm event are part of the surface impoundment design. The design for each surface
impoundment required at the facility will be developed based on the site-specific conditions and
material availability.
Waste material tailings of clay, quartz sands, and gravel will serve as backfill for the mine cells,
mimicking pre-mining topographic features. After being pumped back to the mined-out cells, the
tailings are allowed to settle and dewater. The tailings initially include approximately 40% to
45% solids, of which approximately 35% is clay. Complete consolidation of the tailings is time-
dependent, but the tailings begin consolidation immediately. The tailings remain flowable for
relatively short periods of time, and Iluka has found that the material is not flowable at the time
the impoundments are broken during final grading. For purposes of Iluka's MSHA permits,
MSHA does not consider the tailings impoundments readily flowable.
The topsoil containment berms are graded across the mined areas as top dressing for the final
reclamation contouring. Due to the high clay content of the ore, the final grades of some
reclamation areas might be approximately 20% to 30% higher than the pre-mining contours.
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Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
General
For the purpose of this text, the following terms and definitions are used:
• in-situ ground - unmined ground or undisturbed ground below an excavation. The
integrity of in-situ ground shall not be disturbed by excavation, backfilling or scarification
(except for keyway cuts).
• pre-mined natural ground elevation - the existing contour elevations prior to land
disturbance activities.
• downstream - the direction of lower adjacent impounded water/silt levels
Documents titled "Form to determine if a dam is governed by the Dam Safety Law of 1967" and
the "Dam Hazard Classification Form" will be submitted to the NC Dam Safety Program in order
to receive approval that a dam safety permit is not required. See Figure 1 for the definitions
exhibit.
Figure 1: Definitions Exhibit
PRE-MINED NATURAL
GROUND ELEVATION
PROPOSED IMPO.UNDMENT
(TYP.) DOWNSTREAM
IMPOUNDED WATER
V
V
� °O
6�
- o
I
I _ I' I I I _I II II I —II II
J IN-SITU GROUND
IL Impoundment Construction Sequence
Whenever practical, impoundments will be constructed such that impoundments at lower
elevations are constructed first. This will not always be practical, and impoundments may be
constructed in any sequence. Regardless of constructions sequence, all impoundments will be
constructed according to the above-listed design criteria.
Overview
Iluka intends to operate as exempt from G.S. 143-215.25A, but Iluka will submit design plans to
NCDENR if dams exceed the jurisdictional threshold. There will be two criteria to determine if
an impoundment is considered exempt. Each impoundment will be designed and constructed in
accordance with these criteria as applicable.
Kleinfelder Southeast, Inc. Page 2 of 4 September 9, 2013

Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
Criterion 1
The first criterion is to be used when employees are working in a pit downstream of an active
tailings area. In criterion 1, the following standards apply:
• Impoundments must be constructed so that they are less than 25 feet in height or
contain less than 50 acre-feet of capacity above in-situ ground.
• To serve as a setback, an open pit must be constructed between the employees in the
downstream pit and the active tailings pit.
• The open pit shall be sized such that it can contain the volume of the upstream tailings
pit (volume B > volume A in Figure 2).
• The setbacks between impoundments must be a minimum of 100' or 10 times the height
of the dam, whichever is greater (dimension A in Figures 2 and 3).
• The height of the dam will be calculated from the crest of the dam to the lowest in-situ
ground point on the downstream side of the dam (dimension B in Figure 3).
• Volume calculations will be from the lowest in-situ ground point to the maximum pool
level within the impoundment.
Criterion 1 is shown in plan view and cross-section view in figures 2 and 3, respectively.
Figure 2: Plan View
ACTIVE ACTIVE
TAILINGS PIT TAILINGS PIT
VOLUME A
OPEN PIT OPEN PIT
VOLUME B
DIM.A
EMPLOYEES IN PIT
Kleinfelder Southeast, Inc. Page 3 of 4 September 9, 2013

Aurelian Springs Mineral Sands Mine Iluka Resources, Inc.
Figure 3: Cross-Section View
DIM A
MIN 100'OR 15'
10 x THE HEIGHT OF DAM,
{TYP.)
WHICHEVER IS GREATER
ACTIVE TAILINGS PIT OPEN PIT EMPLOYEES IN/PIT
B
0 tf o I
� o 0
0
Criterion 2
The second criterion is to be used when there are no employees working downstream of an
active tailings area. In criterion 2, the following standards apply:
• Impoundments must be constructed so that they are less than 25 feet in height or
contain less than 50 acre-feet of capacity above in-situ ground.
• The height of the dam will be calculated from the crest of the dam to the pre-mined
natural ground elevation (dimension C in Figure 4).
• Volume calculations will be from the crest of the dam to the pre-mined natural ground
elevation (volume C in Figure 4).
Figure 4: Cross-Section View
15'
(TYP.)
G IMPOUNDMENT VOLUME C
[VOLUME C]
ACTIVE NO EMPLOYEES
TAILINGS PIT IN PIT
0
I o I
O
Kleinfelder Southeast, Inc. Page 4 of 4 September 9, 2013

Jon Frazier
From: McEvoy, Steve <[e-mail]>
Sent: Monday, September 16, 2013 5:28 PM
To: Jon Frazier
Cc: Davis, Tracy;Vinson, Toby; Boyer, Janet; Denton, Bill;Idol, Tami
Subject: RE: Iluka Aurelian Springs Revised Impoundment Design Guidelines
Attachments: DEMLR Criterion Defn.pdf; Aurelian Springs-Revised Impoundment Design Guidelines_
2013-09-09.pdf
Jon:
I wanted to send this along to you ahead of our meeting on Wednesday, September 18 to facilitate discussion. Please
see attached our response to the criterion discussion for jurisdictional exemption in your proposal based on how DEMLR
would interpret 15A NCAC 2K. I also attach your proposal for reference convenience.
In addition, I recall discussion in our July 30 meeting relative to Figure 4 and in particular dimension C. DEMLR considers
the height dimension to be measured from in-situ ground elevation at the downstream toe to crest elevation of the
embankment and has consistently measured height in this manner for the mining industry. In addition, volume in like
manner has consistently been measured from in-situ ground elevation. The internal dike height and reservoir volume
shown in Figure 4 would be measured in this manner. If you eliminate the internal dike leaving only one open pit,the
reality is that if the Figure 4 cross section were cut on an axis along the fall of the terrain,the two C dimensions shown
could vary considerably given equal crest elevations. There may be cases relative to Figure 4 involving non-high hazard
conditions whereby given a single open pit for slurry storage without divider dikes and a 360 degree containment
(perimeter) dike, DEMLR would consider the largest C dimension (a downstream dimension) along the circumference of
the perimeter dike as dam height but would measure reservoir volume from the in-situ ground floor elevation of the
single pit.
Please feel free to share this with anyone you feel would be interested. I look forward to our meeting. Thank you.
Steven M. McEvoy, PE
State Dam Safety Engineer
NC Land Quality Section
1612 Mail Service Center
Raleigh, NC 27699-1612
Office: [phone]
[e-mail]
E-mail correspondence to and from this address may be subject to the North Carolina Public Records Law and may be
disclosed to third parties.
From: ]on Frazier [mailto:]Frazier(akleinfelder.com]
Sent: Monday, September 09, 2013 2:56 PM
To: McEvoy, Steve
Cc: Davis, Tracy
Subject: Iluka Aurelian Springs Revised Impoundment Design Guidelines
i

Hi, Steve.
I've attached the revised impoundment guidelines based on our discussion during our meeting on August 301h. Please
take a look and let us know if you have any questions or need any additional information.
Tracy,these guidelines will be included in the overall operations plan, which I sent to Ashley on July 23rd. This version of
these guidelines is different than what is included in the operations plan that I provided because we met with Steve
after I sent Ashley the plan.
Thanks.
Jon Frazier, PE, LEED AP
3500 Gateway Centre Blvd, Suite 200
Morrisville, NC 27560
o 1919.755.5011 ext. 135
f 1919.755.1414
c 1 919.610.1051
Kt.E1rF.7j.Z7AFR
Bryht People.Right Lo�u[rons.
2

Criterion offered bV DEMLR (9-16-13):
It is suggested that Figures 2 and 3 be renamed 2A and 3A. Two new figures would then be
created. Figure 2B would have three cells eliminating the two open pit cells in Figure 2A and
noting "no employees or others in pit". Dimension A would remain as in Figure 2A. Figure 3B
would delete the open pit and containment dike shown to the right in Figure 3A with the addition
of a note stating "no employees or others" in the far right pit. Dimensions A and B remain as in
Figure 3A.
Criterion 1
The first criterion is to be used when employees are working in a pit downstream of an active
tailings area or when there are other people and/or facilities in a pit downstream of an active
tailings area. In criterion 1, the following standards apply:
1. Impoundments must be constructed so that they are less than 25 feet in height or
contain less than 50 acre-feet of capacity above in-situ ground.
2. To serve as a setback, an open pit must be constructed between the employees in the
downstream pit and the active tailings pit.
3. The open pit shall be sized such that it can contain the volume of the upstream tailings
pit (volume B > volume A in Figure 2A).
4. The setbacks between impoundments must be a minimum of 1 00' or 10 times the height
of the dam, whichever is greater (dimension A in Figures 2A and 3A).
5. The height of the dam will be calculated from the crest of the dam to the lowest in-situ
ground point on the downstream side of the dam (dimension B in Figure 3A).
6. Volume calculations will be from the lowest in-situ ground point to the maximum pool
level within the impoundment as defined by crest elevation of the containment dike.
Criterion 2
The second criterion is to be used when there are no employees working downstream of an
active tailings area or when there are no other people and/or facilities in a pit downstream of an
active tailings area. In criterion 2, the following standards apply:
1. Impoundments must be constructed so that they are less than 25 feet in height or
contain less than 50 acre-feet of capacity above in-situ ground.
2. The setbacks between impoundments must be a minimum of 100' or 10 times the height
of the dam, whichever is greater (dimension A in Figures 2B and 3B).
3. The height of the dam will be calculated from the crest of the dam to the lowest in-situ
ground point on the downstream side of the dam (dimension B in Figure 3B).
4. Volume calculations will be from the lowest in-situ ground point to the maximum pool
level within the impoundment as defined by crest elevation of the containment dike.
END