Prosperity Gold-Copper Project MOE (Kym Keogh) Final Comments

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1 ID# COMMENT/ TASEKO RESPONSE COMMITMENT REQUIRED CURRENT STATUS OF 1. Analysis results for selenium in fish tissues by the Proponent were varied. Virtually all the results were greater than guidelines The QA/QC results of spiked samples always resulted in lower levels actually found in the tissues than what was known to exist. This suggests that all the results in fish were likely underestimating the true quantities. No samples were collected and analyzed for Taseko River. More samples are needed for baseline information of Beece Creek and Taseko River as these are the important fisheries resources that could potentially be impacted. As the current (background) levels in fish exceed guidelines, minimizing any further selenium accumulation will be important to the health of the fish population. Selenium levels in rainbow trout exceeded guideline in 100% of liver samples and 50% of muscle samples from Taseko River (12 fish) and 40% of liver samples and 20% of muscle samples in lower Fish Creek (10 fish), EIS p One sample from Beece Creek (composite of 3 fish) had selenium levels higher than guideline for liver tissue (Baseline Report Table 2-17). There are no changes predicted for levels of selenium or other metals in fish of Beece Creek, given that selenium levels are low ( to mg/l) in water of affected systems (Fish Lake, Wasp Lake, Beece Creek). The clean water diversions will result in an annual increase of 3.8% over baseline Beece flows, mainly during freshet there will be :1 dilution in Beece from freshet through late summer (EIS Vol 5, p and Fig. 2-5). During post-closure, there will be no diversion of clean water toward Beece Creek. Discussed further with Karen Munro of Jacques Whitford/Axys and was sent additional information from the sampling done in 1996, 1997 and 2006 that was not found in the Application. Upon review of this report, adequate sampling had been done of all the creeks and rivers of concern in this project including the Taseko River. Selenium results were within the expected ranges for both muscle and liver tissue and the QA/QC met the specifications. No further sampling is required at this time. /CONCERN No concerns with the quantity and quality of the last three years of fish tissue sampling. Taseko has committed to meet existing BC water quality guidelines for selenium for Fish Creek and Taseko River, through treatment if needed. This will reduce the risk of bioaccumulation in fish and other aquatic organisms. 2. The Application provides baseline results for lower Fish Creek sediments that have levels of arsenic and antimony that exceed guidelines. Further inputs of these two metals will have to be Additional monitoring of fish tissue, water and sediment will be done for Fish Creek and Taseko River closer to the time of discharge. The monitoring plan will be designed during the permitting process, in consultation with the regulatory agencies. Monitoring will be conducted closer to the time of discharges to Fish Creek from the pit. The monitoring plan will be designed during the permitting process, in consultation with the regulatory agencies. No further comments Taseko Mines Limited Prosperity Project Updated as of 8/6/ Page 1 of 9

2 ID# COMMENT/ TASEKO RESPONSE COMMITMENT REQUIRED CURRENT STATUS OF /CONCERN evaluated prior to discharging and mitigation may be necessary to prevent impacts to aquatic life. 3. There is a potential for mercury additions throughout the mine development process including the construction of Prosperity Lake. Mercury is typically monitored in fish tissue and levels for wildlife and human consumption will be of high importance in this project. The baseline studies indicate elevated levels of mercury (>0.1 mg total Hg / kg wet weight) in muscle of 35% of rainbow trout in Fish Lake (39 fish) and Fish Creek (10 fish). In the EIS, results were compared to guidelines for human consumption. The CCME and BC tissue residue guideline (TRG) for mercury is mg/kg methyl mercury, which is applicable to wildlife that consume fish. The TRG assumes all mercury in tissue is in the form of methyl mercury. As a result, the mercury levels in Fish Creek and Fish Lake fish would already pose a risk to piscivorous wildlife. Mercury levels will be monitored in the various waste streams during operations and closure. If elevated levels are measured, appropriate action will be taken. Commitment: Levels of mercury in water will not be used to determine mercury risk to the environment. Other methods, such as fish tissue or sediment quality, will be required and a review of study methods and guidelines will be done in conjunction with the and EC and agreement, on the best approach, will be reached prior to monitoring. and EC will be involved in determining the best method for monitoring potential mercury impacts in the aquatic environment. Prior to any monitoring, a study design will be proposed by Prosperity for review by the regulatory agencies. As stated in EIS Vol. 5, Section 3 (page 3-48), organic soils will be removed and stockpiled during development of the tailings facility and Prosperity Lake to reduce the potential for generation of methyl-mercury. 4. Big Onion Lake predictions No statements about the impacts to the lake after 100 years of pore water seepage. At that point, seepage water quality will worsen as the pores and binding sites for metals between the TSF and Big Onion Lake will have been saturated. Although the pore water will not increase in flow, it will decrease in water quality. The geochemical testing done to develop the prediction of post-closure water quality indicated no detectable levels of mercury in the majority of tests, with a few values just above the detection limit. In the strict sense of the numerical simulation, the statement that seepage water quality will worsen after 100 years is correct, as the pore water contamination source is represented as a constant source zone. In reality, this is only one possible outcome and relies on the following assumptions: 1) TSF pore water quality will remain constant in time at levels consistent with current worst case chemistry predictions, 2) cation exchange capacity, adsorption sites and other chemical This comment was acknowledging the issues for Big Onion Lake as given in the Application. Monitoring of Big Onion Lake and monitoring of Taseko River at various points should identify any potential issues and it is expected that mitigation measures will be implemented if necessary. For Taseko River Taseko Mines Limited Prosperity Project Updated as of 8/6/ Page 2 of 9

3 ID# COMMENT/ TASEKO RESPONSE COMMITMENT REQUIRED CURRENT STATUS OF /CONCERN reactions that may retard contaminant migration rates and/or attenuate some contaminant concentrations are exhausted after 100 years (no retardation mechanisms were considered in contaminant transport simulations completed to date) and 3) seepage will be permitted to reach Big Onion Lake if it will be detrimental to lake water quality. monitoring, see the Commitment in ID #8. No further comments. Taseko Mines Limited proposed monitoring approach (described in memo dated July 9, to K., M. Sabur, K. Moore and others at ) will be designed to monitor groundwater quality as it migrates towards Big Onion Lake. The design of this monitoring program will be guided in part by results of numerical simulations completed to date as part of the application. If seepage of unacceptable quality is identified through monitoring, seepage mitigation measures (e.g. groundwater interception wells) would be installed to intercept and direct this seepage back to the TSF during operations or to the pit lake during closure and post-closure. To support the design of the monitoring system and to demonstrate the feasibility of using groundwater interception wells to control seepage if necessary, Taseko Mines Limited has committed to completing additional hydrological and hydrogeological investigations in the area of the west embankment and in the down gradient Big Onion Lakes watershed prior to the construction of the west embankment of the TSF. The findings of these investigations will be used to further refine the simulation model (if necessary based on investigation results) and design appropriate monitoring and secondary seepage control measures for the TSF. No statements are made beyond the 100 years time frame, because it is not reasonable to extend simulations any further Taseko Mines Limited Prosperity Project Updated as of 8/6/ Page 3 of 9

4 ID# COMMENT/ TASEKO RESPONSE COMMITMENT REQUIRED CURRENT STATUS OF /CONCERN 5. There was no mention in the Application about changes to the design of the TSF such as an increase to the dam height, to handle a % increase in potentially acid generating (PAG) material if necessary. This would have significant impacts to all aspect of the mine plan from balancing water levels between the TSF and Prosperity Lake to the increased seepage as a result of greater pressure on the dam walls. quality predictions would need to be recalculated to account for the additional PAG in the TSF and increased seepage to Big Onion Lake and Taseko River. into the future with the information currently available. Nor, as discussed previously with Kevin Bennett ( hydrogeologist), is it really practical to predict effects a century out. The point of the numerical transport simulation model was to identify where, when and what be might an issue for water quality in the Big Onion Lake system. Now that we know what parameters may be an issue, and where along the western ridge the greatest seepage may be expected to occur, further refinement to the design of the west embankment, including seepage control measures, can be made once further data is collected in this area to better constrain the design. An increase of 70M tonnes of PAG waste rock stored within the TSF will result in an increase of approximately 2 m of the dam height. The total dam height of the base case design is 96 m. While an increase in the volume of stored PAG within the TSF would result in a different total flow through the subaqueous pile, there would be a decrease in the flux from the tailings, since the surface area of the combined stored materials is essentially remaining unchanged. chemistry would not be expected to change, as loading changes would be driven by changes in flow volumes. How can you be sure this will not be a problem? Please provide some evidence to support this prediction and in the response address the hydrology and groundwater flow changes. If additional PAG is to be deposited into the TSF, an additional evaluation may be necessary to determine whether the increase in dam heights will cause changes to the seepage water movement through the soils or create difficulties for managing Prosperity Lake. This evaluation should also address the potential for further degradation to the water quality in the TSF and porewater (groundwater and seepage) and discuss resulting impacts to the Big Onion Lakes and Taseko River if applicable. Taseko Mines Limited Prosperity Project Updated as of 8/6/ Page 4 of 9

5 Further Baseline Monitoring Further Baseline Monitoring ID# COMMENT/ TASEKO RESPONSE COMMITMENT REQUIRED CURRENT STATUS OF /CONCERN 6. quality including nutrients, metals, physical parameters, dissolved ions and carbon for sites W3, W5, and W6 as well as several sites upstream between Fish Creek and Taseko Lakes. 7. More benthic sampling on Taseko River as little sampling has been done to date due to difficulties with the substrate and high flows. Sites in Fish Creek, Taseko River and other relevant waterbodies will be monitored during operations, closure and post-closure. The monitoring programs will be designed during the permitting process, in consultation with the regulatory agencies, and will be based on the time frames relevant to updated baseline information and effect-based monitoring. Benthic invertebrates in the Taseko River were sampled in 1997 and Additional monitoring programs (if any) will be designed during the permitting process, in consultation with the regulatory agencies, and will be based on the time frames relevant to updated baseline information and effectbased monitoring. Effects-based monitoring will be important if the mine is operational; however, having an understanding of whether effects are occurring is derived from a knowledge of the baseline prior to any mining activities. Commitment: Design and implement a water quality sampling program for Years -2, -1, and 0 along the Taseko River with several sites upstream of the Fish Creek outlet which monitors metals, nutrients, carbons, dissolved ions, and physical parameters. The design will be reviewed by staff from the Ministry of Environment and Environment Canada and must meet their requirements. However, benthic sampling did not occur in 2006 on Beece Creek. There is some potential for flow and water quality changes during the early stages of mine development due to the construction of Prosperity Lake. Commitment: Prior to any water being diverted to Wasp Lake, benthic sampling will occur on Beece Creek upstream and downstream of the probable Wasp Lake overflow location. A new upstream site must be identified that is within 2.5 km of the overflow outlet. Habitat and water Baseline monitoring of Taseko River along the zone of potential impacts from the Taseko Lakes outlet to downstream of the Fish Creek outlet. This background will be supporting the proposed operational monitoring and provide information about the concerns regarding the potential for the immediate groundwater effects. Baseline information on Beece Creek was done too long ago to be of relevance. New information needs to be acquired prior to any water flowing from Wasp Lake to Beece Creek as a result of mining activities. Taseko Mines Limited Prosperity Project Updated as of 8/6/ Page 5 of 9

6 Further Baseline Monitoring ID# COMMENT/ TASEKO RESPONSE COMMITMENT REQUIRED CURRENT STATUS OF /CONCERN 8. Tissue sampling from fish in Taseko River to adequately define baseline values for selenium and mercury. This will identify the range of values and the extent of variability which will assist in developing future monitoring programs to ascertain water quality impacts from any discharges from the mine site. Fish from the Taseko River were sampled for analysis of metals in tissue in 1997 to provide baseline data. Further monitoring to augment the baseline data will be conducted before discharge from the pit begins, to be able to identify changes related to the discharges. The monitoring programs will be designed during the permitting process, in consultation with the regulatory agencies, and will be based on the time frames relevant to updated baseline information and effectbased monitoring. characteristics must also be measured. SEE ID#3. However, copper and zinc were not part of the tissue analysis. When this was noted in an earlier submission for work occurring in the 2007 field season, the response was as follows: Comments noted. While no further sampling is contemplated at this time it is anticipated that as the environmental assessment proceeds and plans for the development of the project advance additional sampling including the establishment of various monitoring protocols will be undertaken. See ID# 3 However, there is no baseline information on copper, silver and zinc in fish tissues for the Prosperity project. Any future fish tissue sampling and analysis must include these metals. Not part of the EA process but now to be part of the permitting process? Better Understan ding of Climate Change Impacts 9. A document that takes into consideration flow and water quality changes due to Mountain Pine Beetle and the predicted reduction of glacier melt inputs to Taseko River and the resulting impacts to water quality predictions. Flow changes related to Mountain Pine Beetle have been discussed, but not quantified. Considering that discharge is expected to occur nearly 50 years from now, when most of the forest in the Taseko River catchment may have begun to regenerate to at least baseline conditions, let alone significant green-up in a much shorter time frame, it was decided that modeling related to this effect would be more appropriate some time during operations when better predictions of forest regeneration post-pine Beetle can be made. There has been subsequent discussion on glacier melt between Commitment: Any future tissue sampling must include all previous metals analyzed and copper, silver, and zinc. No disagreement with the response about Mountain Pine Beetle impacts. Just a note that forestry research has shown that it takes at least 20 to 40 years of tree growth for complete hydrological recovery after this type of devastation. The discharge is predicted to begin in Year 44 but new tree growth has not necessarily started yet. Thought this issue was ironed out during If predictions for the icefield retreats are realistic, then water quality predictions could be closer to the worst case scenario for most of the season, not just during spring low flow periods. quality predictions will need to be further refined prior to discharging from the Pit to Taseko Mines Limited Prosperity Project Updated as of 8/6/ Page 6 of 9

7 ID# COMMENT/ TASEKO RESPONSE COMMITMENT REQUIRED CURRENT STATUS OF /CONCERN ( ) and project hydrologist Jamie Cathcart (Knight Piesold), which addressed this comment. Changes in Taseko River flows as a result of complete glacier melt were addressed in Comment 20 of the issue tracking document dated June 5,. As discussed in EIS Vol. 5, p and Figure 2-16, baseline hydrological studies of Fish Creek indicate March to May is when Fish Creek contributes the greatest flow to the Taseko River (up to 11% then vs. 1% on an annual basis), due to differences in the rate of snow melt in the two systems. This is when water quality of Taseko River is predicted to be most affected by discharges from the Project. The projected change in the Taseko River hydrograph after glacier melt, albeit without having the necessary data to quantify this, will result in less flow after the peak compared to the current conditions. This projected change is consistent with research conducted at UBC and the understanding of how flows are affected by retreating glaciers. Since the most sensitive time of effects on Taseko River water quality from the mine discharge is during peak flows from Fish Creek (March May, prior to the peak flows of the Taseko River), there will not be a significant change to the water quality predictions provided in the EA. Whatever changes that may occur in water quality predictions in the Taseko River will occur during the low flows from the Fish Creek system (July onwards). The relative flows between the discharge from the mine and the Taseko River will remain very similar. discussions between the consultants and me but the last paragraph indicates otherwise. The flows in Taseko River are expected to be less from July onwards while the Fish Creek flow should not be affected by the reduction in glacier inputs. Therefore, the water quality will be worse than predicted for the later months of the year and this poorer water quality will last for a longer period and therefore the aquatic species will be potentially spending more time in poorer water. Additionally, the later summer months when this water will potentially be degrading due to less glacier contributions to flow, is also a critical time for species in the river spawning. Commitment At least five years prior to the predicted discharge year, further work on flows and predictions of reduction due to glacier melt will be required. determine what the potential impacts will be based on the different flow levels. High value fisheries resources are of concern. The prediction for water quality in the Taseko River remains conservative as it is based on the most sensitive time (maximum discharge from pit vs. relatively low discharge in Taseko Mines Limited Prosperity Project Updated as of 8/6/ Page 7 of 9

8 ID# COMMENT/ TASEKO RESPONSE COMMITMENT REQUIRED CURRENT STATUS OF /CONCERN Taseko River) in May. More Certainty around the Pit 10. Predictive modeling of the pit water quality based on known information using a common mine pit lake model and provide some research into the limnology characteristics of deep water lakes and if available, deep water mine pit lakes. The monitoring plan will include flow monitoring on the Taseko River closer to the time of discharge and there will be a larger database on which to assess temporal changes in flows, refine the water quality prediction and modify effluent treatment if needed. Additional modeling and predictive work is being conducted by Roger Pieters and Greg Lawrence at UBC to clarify the description of physical limnology in the pit lake and the likelihood of lake turnover. The report is expected in late July. Information on physical limnology will be important in defining mixing volumes (i.e. thickness of quasi-stable surface layer and the depth of mixing, if any, during a turnover event). Will await the additional modeling. Unresolved. Better Understan ding of Impacts to Ground from the Pit Lake 11. The resulting mine pit at completion of operations will be approximately 450 meters in depth and will be almost 300 meters below the Taseko River elevation. At the point where the water in the pit is higher in elevation than Taseko River, groundwater seepage will migrate towards the Taseko River. No discussion has been provided in the Application about this impact to water quality. Predicted pit lake quality described in the EIS (Vol. 5, Table 2-24) is for unmitigated conditions, and will be considerably better than described in that table in order to meet water quality guidelines in Fish Creek. The potential for seepage of pit lake water toward the Taseko River was considered in the application (Appendix 4-4D Numerical Hydrogeologic Analysis). In general, it is an oversimplification to predict that once the pit lake level rises above the Taseko River level there will be a hydraulic gradient from the pit lake to the river. This does not account for the effects of local topography and groundwater elevations over the approximately 4 km between the pit and the river. During pit lake filling, no gradient is predicted from the pit lake to the Taseko River because groundwater It is not understood why the model would predict that the Pit Lake water level will eventually reside below surrounding groundwater levels. It would be expected that with surface runoff and overflow from the TSF, the Pit Lake level would be above groundwater levels and therefore would support the discharge to Fish Creek that is predicted in the Application. Please provide some evidence to support this While it appears to be reasonable speculation based on the modeling, information gathered to date and some geological and hydrological assumptions, there are still many unknowns. Mitigation may be necessary if an issue arises from Pit water infiltrating Taseko Mines Limited Prosperity Project Updated as of 8/6/ Page 8 of 9

9 ID# COMMENT/ TASEKO RESPONSE COMMITMENT REQUIRED CURRENT STATUS OF /CONCERN elevations between the pit lake and the Taseko River are higher than both the lake level and the river level, so groundwater will flow toward the pit lake or towards the Taseko River (i.e. there will be a hydraulic groundwater divide between the pit and the Taseko River during pit filling). Once the pit lake is full, field data (i.e. measured groundwater elevations) and current numerical simulation results) indicate that seepage from the lake will be at or near 0 m 3 /day. This result is considered reasonable because the pit lake water level in the simulation model typically remains lower than the surrounding groundwater elevations. response. See ID #8 which provides background on Taseko River and will be useful in monitoring potential impacts from the mine site including any movement of water from the Pit to Taseko River. groundwater at deeper locations. Depending on where the pit lake water level is maintained compared to surrounding local groundwater elevations, there may exist the potential from time to time for some seepage of pit lake water into the surrounding materials. It is reasonable to anticipate that these flows would report to Fish Creek downstream from the pit lake, and eventually discharge to the Taseko River. However, this seepage rate will generally be very small compare with the flow rate of surface water. In the event that pit lake water quality requires treatment prior to discharge, the pit lake level could be managed such that lake levels remain lower than the surrounding groundwater levels to minimize the potential for seepage from the lake to the local groundwater environment. Taseko Mines Limited Prosperity Project Updated as of 8/6/ Page 9 of 9