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MN2020 - With New Mining, The Choice is Ours
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With New Mining, The Choice is Ours

July 26, 2012 By Will Nissen, Fellow

North Dakota’s oil and gas boom has brought both benefits and struggles to the state as it deals with an enormous influx of equipment, machinery, people and money. As I’ve said before, the fact that the oil and gas resources exist underground in North Dakota is circumstantial and timely given recent breakthroughs in drilling technology.

Here in Minnesota, huge copper, nickel and other precious metal mining (also known as copper-nickel mining) proposals have surfaced in recent years at several sites in northeastern Minnesota. The fact that these resources are here is also circumstantial, but the policy choices we make regarding whether and how to extract those resources will determine the impacts, both good and bad, of new mining in our state.

There are currently two proposals for copper-nickel mining projects in northeastern Minnesota. The PolyMet Mining Corporation has proposed an open-pit mine on public lands in the Superior National Forest, between Babbitt and Hoyt Lakes, MN. Twin Metals Minnesota, LLC has proposed an underground mine on public lands in the Superior National Forest near the Boundary Waters Canoe Area Wilderness (BWCAW), southeast of Ely, MN.

These are not small projects. Current estimates from the PolyMet Draft Environmental Impact Statement (DEIS) say that 228 million tons of base and precious metals would be mined and processed over the mine’s 20 year life span. This would put the mine in the top 5 copper mines in the U.S. in terms of capacity. The Twin Metals mine would be the largest underground mine in Minnesota’s history, and the covered area of both mines encompass one of the world’s largest untapped copper deposits.

Environmental groups have raised significant and legitimate concerns over the underground sulfide ores that house the valued copper, nickel and other precious metals. According to the U.S. Environmental Protection Agency, hard rock mining is already the country’s most toxic producing industry. When sulfide ores are mined and exposed to oxygen through copper-nickel mining, they can have even more toxic effects on water and soil resources in the mining area.

A recent report released by Conservation Minnesota, Friends of the Boundary Waters Wilderness and the Minnesota Center for Environmental Advocacy highlights sulfide ore mining occurring in other states and countries. In many cases, despite guarantees that water quality standards would be met and efforts from mining companies to do so, unacceptable contamination of water supplies and soil resources happens over 75% of the time in and around mining sites.

When contamination occurs it can be difficult to cover the costs for cleanup and remediation. Mining companies go bankrupt or fail to set aside enough financial assurances ahead of time, and taxpayers can end up holding the bill to cleanup their own community. These concerns should be taken seriously given the proximity of these mining proposals to the BWCAW, and their location within the Superior National Forest and Lake Superior watershed.

As with North Dakota’s oil and gas boom, new mining in Minnesota would bring jobs to the northeastern part of the state and increase tax revenues from mining operations. But predictions of job creation for both the PolyMet and Twin Metals projects have been inconsistent, scaled back as the projects progressed, and consist mainly of non-local jobs.

Tax revenues would also increase with copper-nickel mining. Taconite mining brought in nearly $80 million through the Taconite Production Tax alone in 2010. But these increases can be offset by costs to repair and upgrade public and private infrastructure, losses in tourism revenues and lower property values, and costs to remediate contaminated mining areas.

Thankfully, Minnesota has an elaborate regulatory system in place, with the Department of Natural Resources and the Army Corps of Engineers leading the environmental review process, plus input from tribal agencies, the Minnesota Pollution Control Agency and federal regulators. PolyMet has been involved in its environment impact assessment process for several years.

However, the environmental sensitivity and public value of areas within and surrounding the proposed mining sites, as well as the disturbing environmental record of copper-nickel mining, leave no room for error in the regulatory process. Even more troubling is proposed legislation at the federal level that threatens to erode our critical environmental regulatory institutions.

True, we need the copper, nickel and other precious metals in the proposed mining sites to make many of the things we use today. Some short-term job creation and tax revenue increases will also occur from these projects. But these are not small, backyard mining projects. If we fail to account for the potentially devastating impacts of this type of mining to our water, soil and valued natural resources and landscapes, we will be paying for the cleanup and remediation of these resources for decades after mining has stopped.

We have the resources in our borders, the technology to extract them and the market demand to sell them. Our policymakers need to consider carefully whether the pros outweigh the cons of expanded mining in our state, and if they do, how to best manage this process moving forward.
 

Thanks for participating! Commenting on this conversation is now closed.

2 Comments:

  • KJC says:

    July 31, 2012 at 9:21 am

    Since these deposits are on public lands, I presume there will be a lot of public revenue generated, that this won’t be a “sweet heart” deal?  If not, this is not a good idea. 
    Example?  Texas uses “oil separation” fees… so we have all helped pay their taxes when we buy our gasoline… to generate a lot of revenue for them.  Maybe this is Minnesota’s opportunity to balance all those years where we’ve bled for the oil industry?  (We didn’t get those fees when our old growth forests were mowed down, or when our high quality iron ore was shipped out.) 
    My concern is that will be turned into a another “privatize the gains, and socialize the losses” project.  This should be a Public Good project, with industry merely being an Operating Partner.  And the record for this kind of mining is not that good.  Oh?  Imagine if the company declares bankruptcy later in the game, just as the clean-up costs start ramping up.  Yes, then the taxpayers get stuck yet again.  I am so tired of that kind of corporate welfare, where they take the money (for what they want) and then find a way to run and evade when it comes time to pay the total costs.  (And likely slip a little money to some lobbying group screaming about too many regulations and other “smaller government” rhetoric, etc.)
    Can’t happen?  Here’s where the Montana taxpayers got stuck for $33 Million on a similar mining deal…the costs of clean-up when the mining company conveniently declared bankruptcy.  <http://www.earthworksaction.org/voices/detail/fort_belknap_reservation> 
    Done as a Public Good, with what all the means?  I’d say, then: let’s do it.  Done just to enrich some company (boom to them) and then cleverly leave the costs to all of us (the bust) at the end?  I’d say: “No thank you, we’ll pass.”  This will take vigilance, I don’t want us to have a “Montana” problem.  The copper won’t be getting any less valuable, there’s no reason not to allow ourselves time for full due diligence and ask the tough questions.

  • Ginny says:

    July 31, 2012 at 10:58 am

    As one who treasures the BWCA and surrounding area—among the many things that make this state so desirable and draw people here—I don’t think we can count on ANY assurances from the industry that they will do no harm. We’ve seen their record, and we know the records of all too many of our corporations and financial groups. I would not trust any one of them.
    I would be willing to go up there and sit in front of the bulldozers or whatever they use to stop it.
    Have you seen the defunct open pit mines up north? Do you know what they looked like before they raped the earth and its treasures.
    Some things ARE priceless and should be left alone.