Environmentalists Blast Obama Mining Reversal

Obama Signals Support for Giving Mining Companies Access to Public Land to Dump Toxic Waste, Fueling Criticism

CBS News

(AP) The same week President Barack Obama riled environmentalists with plans for offshore oil drilling, he faces criticism for signaling he will support a Bush-era policy criticized as giving mining companies unlimited access to public lands to dump toxic waste.

The administration asked a federal judge Tuesday to dismiss a challenge by environmental and community groups to a rule that lifted a restriction on how much public land companies can use. The groups are also challenging a 2008 rule that says companies aren't required to pay the going rate to use the land.

Environmentalists said the administration's decision conflicts with its pledge to overhaul the nearly 140-year-old law regulating the mining of gold, silver and other hard-rock minerals on public land.

"The Obama administration can't have it both ways," said Jane Danowitz of the Pew Environment Group in Washington. "Either it stands by its earlier commitment to bringing mining law into the 21st Century, or it continues to allow the industry to dump unlimited toxic waste on public land at the expense of taxpayers and the environment."

National Mining Association spokeswoman Carol Raulston said Friday that her group is pleased with the Obama administration's decision to support the Bush policy.

Interior Blocks New Mining to Protect Tortoise in Southern Nevada

By PATRICK REIS
New York Times

The Interior Department issued an order today banning new mining on nearly 1 million acres in southern Nevada to protect the desert tortoise and other protected species.

The order blocks new claims for the next 20 years but does not affect existing mine operations. Interior originally proposed the ban in late 2007.

The Bureau of Land Management had already designated the tracts in question as "areas of critical environmental concern," as much of the land forms river corridors that provide habitat for desert tortoises and endangered birds and fish.

The area is also a historic hot spot for gold mining, and U.S. Geological Survey evaluations suggest more mineral deposits remain in the region.

Lisa Belenky, an attorney with the Center for Biological Diversity, which has filed several lawsuits against potential desert development to protect the tortoise, said the order adds desperately needed protection.

"This is a very important step to make sure there won't be mining companies coming in to override the protections," Belenky said, adding that the large quantities of mining wastes were incompatible with protecting natural resources.

But Carol Raulston, spokeswoman for the National Mining Association, said putting almost 1 million acres off-limits to new mining ignores larger threats to the tortoise -- oil and gas development, agriculture and natural predators.

"Mining operations have a great deal of successful experience in protecting the desert tortoise," Raulston said. "As such, it seems incongruous to single out mining."

Mining law reform stalls

By Kim Chi Ha
The Hill.com








The General Mining Act of 1872 turned 136 this month, despite a hard push by environmental groups and congressional Democrats to replace the measure.

Reform supporters had high hopes the Old West-era law would be updated and royalties would be placed on mining operations for the first time. One bill passed by the House would generate about $40 million annually to clean up abandoned mines that pose environmental hazards in the West.

“We’re in a period now with exceptionally high metal prices; companies are making billionaire dollars,” said Dusty Horwitt, public lands senior analyst for the Environmental Working Group.

“Now is the time for change,” he said.

A dispute over how much the royalty should be and who should pay, however, continues to bedevil reform efforts in the Senate.

Although a number of Senate Democrats back broad reform, Senate Majority Leader Harry Reid (D-Nev.) has opposed efforts to impose royalties on existing mine operations, as the House bill would do. Few issues are as personal for Reid: His father was a gold miner and his state’s economy depends heavily on the industry.

“One of the elements of the House bill is to set royalties on existing operations, and that is something that Sen. Reid will not support,” said Jon Summers, a spokesman for Reid.

“We’re paying very close attention to the work that’s being done with this bill, and he’s going to move forward with mining reform but in a way that protects Nevada’s industry and all the jobs that come with it.”

An employee at a mining operation makes on average $69,000 a year. The industry employs more than 52,000 workers, according to the state mining agency.

Reid also collects a significant amount of campaign cash from the industry. Mine operations contributed more than $100,000 to Reid from 2001 to 2006, according to the Center for Responsive Politics.

Reform advocates know they won’t be able to get much done without Reid’s help.

“The road of reform needs to go through Nevada, where 85 percent of hard-rock mining takes place,” said Jane Danowitz, director of the Pew Campaign for Responsible Mining.

“Sen. Reid is probably the No. 1 person to provide the kind of leadership needed here to get this done.”

Originally signed into law during the Indian Wars, when Ulysses S. Grant was president, the Mining Act enables mining companies to buy public lands for as little as $5 an acre and to operate on those lands without paying a royalty. It was designed to bring both economic development and settlers to the West.

Over the subsequent administrations of 35 presidents, mining companies have extracted an estimated $245 billion worth of minerals from public lands without having to pay royalties.

Oil and gas and coal producers, by contrast, already pay royalties to federal coffers.

Like those other commodities, prices for hard rocks have skyrocketed in recent years, creating an old-fashioned boom time for the industry.

Revenues of Barrick Gold Corporation and Newmont Mining Corporation, two of the largest claim holders in Nevada, jumped in the first quarter of 2008. Barrick Gold, which reported a $1.12 billion profit in 2007, reported first-quarter net income of $514 million.

The House passed a bill last year that would impose an 8 percent royalty on new mines and a 4 percent royalty on existing operations.

Industry representatives contend that an 8 percent royalty would be the highest in the world and would discourage companies from opening new mines in the United States. The 4 percent royalty on current operations could push companies to shift more operations overseas.

“We’re already operating in the highest-cost region in the world; therefore, that would be very punitive on mining investments in the U.S.,” said Luke Popovich, spokesman for the National Mining Association, the industry’s main lobbying arm.

“A royalty on current operations would penalize the industries that have already been in operation and didn’t base their business plan on having to give up more of their earnings, or we’re just going to drive another industry offshore.”

Some companies would accept royalty payments, Popovich said. But the royalty should only be applied to future mine operations, he said. Another condition is the royalty should be taken off of profits, not gross revenues, to accommodate for rising “input costs” like labor, steel and energy, Popovich said.

Environmental groups contend the industry can afford to pay more.

“That 8 percent royalty doesn’t affect the mining industry at all, it doesn’t limit their access, and it doesn’t cut their revenue,” said Keren Murphy, spokeswoman for the Sierra Club.

Popovich said the revenues companies are now getting may be temporary, but a royalty would be forever. The mining industry is cyclical, and despite the current demand for minerals on the world market, there is nothing to prevent the market from crashing should China or India slow its growth, Popovich said.

According to the Environmental Protection Agency (EPA), there are more then 500,000 abandoned mines that will cost $50 billion to reclaim.

The Bureau of Land Management, Office of Surface Mining, the Forest Service and the EPA often fund the cleanup for these sites. The EPA has spent about $2.2 billion to reclaim abandoned mines.

The royalty in the House bill would generate only $40 million a year.

The bill also imposes new environmental safeguards on mining operations. The industry contends that they are duplicative to current laws like the Clean Water Act, Resource Conservation and Recovery Act and National Environmental Policy Act.

“The current environmental laws in place to regulate the industry for hard-rock mining aren’t working, and we can see that,” said Lauren Pagel, spokeswoman for Earthworks.

The Senate Energy and Natural Resources Committee has held a series of hearings to examine the hard-rock mining industry, but a draft bill remains under discussion.

“A big part of our work at this stage right now is finding a consensus on certain provisions such as royalties and environmental protections,” said Bill Wicker, spokesman for the Senate committee.

“When you look at the law and see how antiquated it is, there’s no reason why Congress should not be tackling this issue. If the Senate fails to take action, it will serve as yet one more example of why many believe Washington is broken.” said Danowitz of the Pew Campaign.

House Close to Dismantling 1872 Statute on Mining

By DAVID M. HERSZENHORN
The New York Times

WASHINGTON, Oct. 31 — The House is expected Thursday to take a major step toward dismantling the last significant law remaining from efforts to settle the American Wild West, an 1872 mining statute that has allowed vast treasures of gold and other minerals to be carted off federal lands without any royalties paid to the government.

For 135 years, the General Mining Law has permitted prospectors to stake private claims to federal lands, although miners now tend to be corporate conglomerates, not frontiersmen with pickaxes. Environmentalists say the law has also left Western states deeply scarred by abandoned toxic mines.

A House bill, the Hardrock Mining and Reclamation Act, would permanently bar the sale of federal lands to miners and would require them for the first time to pay royalties of up to 8 percent of gross income from mining, which would go to a fund to clean up abandoned mines. It would also establish new permitting and environmental rules.

Supporters say such changes are long overdue. “This is the last that I know of those frontier-era legislation to remain on the books,” said Representative Nick J. Rahall II, Democrat of West Virginia, the chairman of the House Natural Resources Committee, who for more than 20 years has been working to overturn the 1872 law.

“The Homestead Act has long been repealed,” Mr. Rahall said. “Laws governing carrying your six-gun into saloons, or allowing a posse to hang horse thieves, as far as I know, most of those are gone. And the West pretty much has been opened up these days and is settled.” He added: “The Mining Law of 1872 is the Jurassic Park of all federal laws. It requires an extreme makeover.”

But in the Senate, the push to update the antiquated mining law will require delicate maneuvering by the majority leader, Senator Harry Reid of Nevada, who is the son of a gold miner and represents the state with the largest gold production, and by other Democrats mindful of the crucial role that Western states will play in next year’s elections.

Mr. Reid has said that he wants to update the law but opposes requiring royalties from existing mining ventures. “He is supportive of mining reform, and this is definitely a step in the right direction,” said Jon Summers, a spokesman for Mr. Reid. “But he doesn’t support this bill in its current form because it imposes royalties on existing operations.”

Senator Jeff Bingaman, Democrat of New Mexico and chairman of the Energy and Natural Resources Committee, held a hearing on the mining law in September and called for change, saying he blamed the outdated 1872 law for criticisms of the mining industry on both fiscal and environmental grounds.

Bill Wicker, a committee spokesman, said Mr. Bingaman and Senator Pete V. Domenici of New Mexico, the committee’s ranking Republican, planned to introduce a mining bill next year.

In prepared statements, both said they were looking forward to the House’s passing of its bill so the Senate could work on an issue that Mr. Bingaman described as “of great importance to New Mexico and the West.”

But other lawmakers have been less enthusiastic. Senator Larry E. Craig, Republican of Idaho, an ally of the mining industry, raised numerous questions about the House bill at a hearing this year. He said mining companies working on federal lands should pay royalties but cautioned against demanding too much.

“The royalty must be carefully set and be reasonable to avoid choking out our domestic industry,” Mr. Craig said. “An 8 percent net smelter return royalty doesn’t mean anything if there isn’t an industry to apply it to.”

The main industry group, the National Mining Association, which opposes the House bill, sounded a similar alarm on Wednesday. “The 8 percent royalty in the House bill would be the world’s highest royalty on minerals,” said Carol L. Raulston, a spokeswoman, “and the United States is already a high-cost production country, because we pay very high wages and we already have a very extensive regulatory system.”

Ms. Raulston also said that many permitting requirements in the bill were onerous, even more cumbersome than existing requirements that are not set in law but that are part of regulations enforced by the federal Bureau of Land Management.

Environmental and other advocacy groups, by contrast, have long called for doing away with the 1872 law. According to various estimates, there are about 500,000 abandoned mines in the Western states that would require environmental remediation costing some $30 billion to $70 billion.

Lauren Pagel, policy director for Earthworks, a group based in Washington, said that while the 1872 law gave state and federal regulators little ability to block mining ventures, the House bill would balance the needs of the mining industry against other land uses, including outdoor recreation, a growing priority in the West.

“Recreation, hunting, fishing are all things that are of very high value in the West,” Ms. Pagel said. “There needs to be a balance between mining, which is very important, with other uses of public land.”

Ms. Pagel said there were also grave concerns about water pollution caused by mining, given the scarcity of water in the region.

The interests of Western battleground states are most likely to be of major interest to the presidential candidates next year, particularly Democrats, who are holding their national convention in Denver.

Mr. Rahall, who is sponsoring the House bill, said that the royalties would provide roughly $310 million for environmental cleanup over 10 years and that new user fees to be paid by mining companies would reduce government spending by $380 million over the same period, while speeding up permitting and other administrative processes.

“What we are doing, hopefully,” Mr. Rahall said, “will be making common-sense reforms.”

This Land May Not Be Your Land

House bill would allow mining claim holders to purchase the federal property. Some fear it would open national parks to development.

By Janet Wilson and Tim Reiterman, Staff Writers
Los Angeles Times

MOJAVE NATIONAL PRESERVE — Standing at the foot of billion-year-old Stripe Mountain, acting park chief Larry Whalon gazed up at ancient slopes banded in limestone and copper.

"In 10 years, there could be a big house right here. Lots of houses," Whalon said.

The entire mountain in the desert preserve west of Las Vegas is covered by federal mining claims, and newly proposed legislation would allow claim holders to purchase this land outright.

Supporters say the mining law changes, part of a spending bill passed by the U.S. House of Representatives last month, are intended to revive dying rural mining towns. But the possible consequences have provoked fierce disagreement.

A House-Senate conference committee is expected in the near future to begin work to resolve the differences between the House bill and one passed by the Senate. The Senate bill does not contain the mining provisions, but it does include an equally contentious measure, rejected by the House, that would open Alaska's Arctic National Wildlife Refuge to oil drilling.

Critics fear the mining law changes could open the door to any type of locally approved development on millions of acres of public land — including national forests and national parks. Records show California's national parks have more mining claims than any others in the U.S.

Six Western governors, all Democrats, signed a letter Thursday opposing the changes, calling them "ill-conceived" with "sinister intent."

"Functionally, 6 million acres of public land could be on the selling block … including lands within our wilderness and national parks system," wrote the governors of Wyoming, Montana, New Mexico, Arizona, Oregon and Washington. "With the potential for new … claims, untold other millions of acres could be up for sale."

The governors said the sale of lands would yield a "paltry" $32 million annually, while sacrificing $2 billion worth of royalties.

Gov. Arnold Schwarzenegger's office is assessing the mining claims legislation, but spokesman Darel Ng said Friday, "He has not yet taken a position."

Supported by the mining industry, the bill is being championed by Reps. Richard Pombo (R-Tracy), Resources Committee chair, and Jim Gibbons, a Nevada Republican and Resources Committee member who wrote the legislation.

The two congressmen maintain it is a long overdue reform of an 1872 mining law that will help ease the nation's deficit and bolster rural economies. They say fears of massive development are unfounded, particularly in national parks and other protected areas.

"This is not some land sale or giveaway," said Pombo spokesman Brian Kennedy. "This legislation allows there to be jobs and economic sustainability after the mine closes."

But others worry that language in the bill could negate regulatory oversight of mining on public lands, and lead to the sale of surface lands atop claims.

"We're trying to decipher this thing. It's amazing how some of it is written," said Death Valley National Park Supt. J.T. Reynolds.

According to the park's mining engineer, Mel Essington, "They could put in a bingo parlor, gambling casinos, a McDonald's….

"A portion of the park extends into Nevada," Essington added. "They could have a legal right to a brothel out there."

Several hundred miles north in Sierra County, where there are about 1,500 mining claims and only 3,500 residents, county planning chief Tim Beals said privatization of claims would create "horrendous conflicts" between the new landowners and fishermen, hunters, hikers and snowmobilers, as well as a rush to build along the rivers. "It would be chaos."

If approved by the Senate, the law would lift an 11-year-old moratorium on the patenting, or sale, of federal lands to claim holders. Purchase prices, now $2.50 to $5 an acre, would be raised to $1,000 an acre or fair market value, whichever is greater. Claim holders could also stake and buy adjoining lands.

Mining industry officials said the ability to patent, or buy, mining claims would help ensure a domestic supply of minerals and provide incentive to make new uses of property containing shuttered mines.

Luke Popovich, vice president of the National Mining Assn., said critics have grossly exaggerated the law's potential effects. "If you put in some common-sense screens … you come up with a total acreage that is seriously possible for privatization of about 360,000" across the U.S, he said.

The bulk of active mining claims on federal land in California are in the Mojave Desert and the Sierra Nevada foothills. The lands are rich in mining history, attractive for development and used by millions of people for camping and other recreation.

The Mojave Preserve, established in 1994, is studded with 432 active claims, meaning they pay fees each year and have done exploratory work.

The existing federal Mining in the Parks Act has tough restrictions that make it difficult to actually mine, and that effectively ban other development.

The land is largely devoid of humans, except for occasional hikers or hunters who share the undulating desert valleys and five mountain ranges with jackrabbits, tortoises, coyotes and small bands of bighorn sheep.

"I call it the big openness," said acting park chief Whalon. "I don't want to lose any ground."

What concerns him most is how the legislation could affect adjacent public land just across the increasingly busy Interstate 15 from the northern boundary of the preserve.

Administered by the U.S. Bureau of Land Management, that land has less protection than the preserve, Whalon said. He fears if it is sold to private owners as a result of the new bill, it could be very profitable to put commercial strips next to the highway, exposing the preserve to light, noise and pollution.

Three hours away in Death Valley, tourists interviewed last week were mostly aghast at the possibility of new mining and development in the park.

"It would be crummy," said Laury Huckling, 35, of Ontario, Canada, marveling at the 35-million-year-old lava beds off Zabriskie Point. "This should be protected forever."

But Don Twiggs, a visitor from Ludlow, Vt., disagreed. "For 360 degrees I see nothing but a lot of rock," said Twiggs, a retired plumbing contractor. "I'm sure you could get some use out of some of it, and still have plenty left over."

Supporters of the bill say buying lands simply for development would remain illegal, and that years of costly mining work would have to be done before the land could be privatized.

"This is not a return to the Old West land rush," said Gerald Hillier, former head of the BLM's California desert office, now a consultant to county officials in four Southwestern states. "People are not going to be able to go out and stake a claim, kick the cattle off, and say 'this is mine.' "

He said market forces would also keep most national forest and BLM land from being developed, because there is still so much available private land closer to towns.

Last week in Sierra County, on snowy ground outside his DigMore Mine, David O'Donnell put on his hardhat and adjusted his headlamp with fingers gnarled from old injuries. A county road worker, he mines his claims evenings and weekends. "If I was not married," said the father of two grown sons, "I would be up here 24-7."

On one level, the legislation appeals to O'Donnell, who mines with a heavy hammer, dynamite and an ore cart inherited from his father. He figures he could acquire his 160-acre claim and cut some timber for shoring up his mine. And he could sell off an interest to raise capital for equipment and helpers.

But he is concerned about development. "I think mining property was not designed for a housing tract," he said. "If people move in, they will think the miners are making too much noise. They would complain about drills and rock crushers … and too much dust."

Mike Miller, who owns the Original Sixteen to One Mine in the nearby hamlet of Allegheny — one of the county's few commercial mining operations — said the new law would make it too easy to purchase mining claims, after as little as $7,500 in mineral development work.

"That is not right," he said.

Unlike some other foothill counties that lost mining and logging jobs, Sierra County is hardly teeming with new development. Three-quarters of the county is public land, and most of the rest has been developed or is too steep and rugged.

Officials said the proposed law could open up vast forests in the county to housing and other private uses, increasing the tax base. They said they welcome development near existing towns but are concerned that development deep in national forests could harm recreational tourism and create new costs for snow removal, ambulance services and police and fire protection.

Adam Harper, manager of the California Mining Assn., said those fears are unwarranted. "The locals have the ultimate say on what can go on a piece of property."

On a recent afternoon, Sierra County Sheriff Lee Adams III stood on a snowy outcropping, looking out over some of the mining claims that extend 40 miles along a stretch of the Yuba River favored by fishermen and whitewater enthusiasts.

"These are some of the most scenic areas of Tahoe National Forest," said Adams, speaking as a longtime county resident. "Say I pay $10,000 for a claim and turn around and sell it to a developer for $200,000. I do not think that is a benefit to the public."

Accusations of land grab in budget bill

Malls, homes feared on hundreds of thousands of acres of public forests and deserts

Zachary Coile, Chronicle Washington Bureau
San Francisco Chronicle

Washington -- California lawmakers and environmental groups warn that a provision in the House budget bill could allow individuals and companies to develop hundreds of thousands of acres of desert, forest or other public lands across the state.

The measure could affect areas from Death Valley to Lake Tahoe , where public lands subject to active mining claims could be converted to private ownership. The land could be mined or used to build homes, ski resorts, shopping malls or other commercial development.

Supporters of the provision -- which ends a 1994 ban on mining land purchases imposed by Congress and the Clinton administration -- claim it would help rural communities make the transition to new types of development after their local mines have closed.

"Without this measure, the jobs and infrastructures of these communities can literally disappear when a mine closes," said Rep. Jim Gibbons, R-Nev., the chief sponsor of the measure, whose state has a large mining industry.

But opponents see a deeper agenda aimed at privatizing vast stretches of public land across the West and boosting the profits of mining companies, developers and individual claim holders.

"With a wink and a nod, this budget proposal sells not just the minerals under these federal lands but the pristine lands that just happen to be located near high-priced ZIP codes," said Rep. Nick Rahall of West Virginia, the ranking Democrat on the House Resources Committee.

Rahall said nothing would stop claim holders who have "patented," or taken over ownership of public land -- for the purpose of mining -- from using the land to build fast food restaurants, Wal-Mart stores or condominiums.

Supporters and opponents of the measure differ sharply on how much land across the West could be affected.

Gibbons and House Resources Committee Chairman Richard Pombo, R-Tracy, who added the provision to the budget bill, cited Interior Department estimates that 360,000 acres of federal land meet the requirements for a sale and that only a third of those lands are likely to be purchased. The Congressional Budget Office estimated the sales would raise $158 million.

But environmental groups point out that much more acreage could be put up for sale under the new rules.

The Environmental Working Group, which has collected mining claims data, estimates that 5.7 million acres of public land is subject to mining claims and could be purchased by the claim holders. Nevada has the largest area of public lands with mining claims ( 2.5 million acres), followed by Arizona (641,000 acres) and California (635,000 acres.)

In California, the largest concentration of mining claims is in San Bernardino County, but the claims extend from the Gold Country to the state's border with Oregon. Even Marin County has a small mining claim on 21 acres close to Highway 1 near the town of Inverness.

The provision in the budget bill seeks to change the 1872 General Mining Law, frontier-era legislation that allows any individual to stake a claim on public land that might contain valuable minerals or precious metals such as gold or silver.

Critics have long called for reforming the law, noting that it charges claim holders 1870s-era prices -- $2.50 to $5 per acre -- for land that can yield big payoffs. In 1994, Congress instituted a moratorium on "patenting" mining claims after a Canadian company was able to buy 1,900 acres of land in Nevada containing an estimated $10 billion in gold even though it paid the government less than $10,000.

The legislation by Gibbons would lift this moratorium on purchasing public lands. The provision would also raise the cost of the land to $1,000 an acre or fair market value, whichever is higher -- which proponents say would raise more money for the federal Treasury.

Critics point out the measure appears to weaken requirements that mining claim holders prove there are valuable minerals beneath the ground before approving a sale of land. Sponsors of the measure say the requirement -- called the "Law of Discovery-Prudent Man Test" -- has simply moved to a different portion of the bill.

The mining provision was not part of the budget bill approved by the Senate and will be one of a number of contentious issues as a conference committee of the House and Senate try to reach agreement on a single bill.

Sen. Dianne Feinstein, D-Calif., sent a letter to Pombo earlier this month urging him to drop the provision, which she said could allow claim holders to buy big parcels of land, especially in national forests and Bureau of Land Management lands.

"It appears that potentially millions of acres of national forests and (bureau) lands would now be required to be put up for sale by the Interior Secretary merely because they contained 'mineral deposits' -- a term undefined in your bill -- or even 'depleted' mineral deposits," Feinstein said.

Feinstein said the measure could affect public lands in or near the Mojave National Preserve and Death Valley, as well as 40,000 acres with active mining claims in the Tahoe National Forest and west of Lake Tahoe.

Brian Kennedy, a spokesman for Pombo, said the legislation specifically bans land sales in national parks, wilderness areas, national monuments, national conservation areas, national wildlife refuges, national recreation areas, wild and scenic rivers and national trails. The bill would apply to other public lands not protected by those designations.

A spokesman for the National Mining Association said the industry is willing to accept higher costs -- $1,000 or more per acre -- in return for the government lifting the moratorium on buying lands where they have mining claims.

"The industry will be better off because we will be able to attract investment by allowing more lands to be privatized -- specifically lands that might have valuable mining claims and where investors might be reassured that they will be able to own the land rather than essentially operating under the government's heel," said Luke Popovich, the association's spokesman.

Most mining companies plan to use the land only for mining -- not real estate development -- although Popovich predicted there would be few cases where mining claim lands would be transformed into homes or ski resorts.

"It could happen," Popovich said. "There will be instances where a resort -- perish the thought -- that might employ people would take up some of the hundreds and hundreds of thousands of acres of federal land. Even if it does happen, in the minds of many people that will be a good thing."