July 5, 2017
Mr. Oskar Lewnowski, CIO
Orion Mine Finance Group
1211 Avenue of the Americas
New York, NY 10036
Dear Mr. Lewnowski,
I am once again writing in regard to Orion’s 19% investment in Aquila Resources’ Back 40 metallic sulfide project in Michigan’s Upper Peninsula. Local and statewide
opposition to this project has grown considerably since my last update (November, 2016) and should be of great concern to your shareholders.
While Aquila now has three of the four permits for the project it still does not have the support of the people and communities that may be adversely affected by pollution from the proposed mine, including the Menominee Indian Tribe of Wisconsin, that has filed a petition for a contested case hearing challenging the Michigan Department of Environmental Quality’s (DEQ) approval of the mining permit.
Since my last update several counties and townships downstream from the proposed mine have joined the Marinette County Board in passing resolutions urging the Michigan DEQ to deny permission for the mine. These include Brown and Menominee Counties in Wisconsin, the City of Peshtigo in Wisconsin, and the Towns of Porterfield and Wagner in Wisconsin. Door County in Wisconsin will be considering a resolution against the proposed mine at their next meeting. The headline from WeAreGreenBay.com (June 23, 2017) sums up the political sentiment succinctly: “Northeast Wisconsin county leaders making resolutions to condemn Back 40 Mine.”
In addition to the counties and townships opposed to the mine, there are ten tribal governments in Wisconsin and Michigan that have passed resolutions against the project. Seven intertribal organizations, including the National Congress of American Indians (NCAI), have also passed resolutions against the mine. The NCAI has promised to assist the Menominee Tribe to oppose the mine “through media exposure, governmental relations, and to support a call for Congressional oversight hearings to highlight the trust, policy and statutory responsibilities of federal agencies in these matters.”
The April 2017 designation of the Menominee River as one of the 10 most endangered rivers by the national conservation group, American Rivers, has given national visibility to local protests against the mine in Menominee, Michigan and Marinette, Wisconsin. In
announcing the designation of the Menominee River, American Rivers noted that “the proposed mine would pose a significant threat to the cultural and natural resources of the Upper Peninsula, Wisconsin and the Great Lakes Region. Groundwater, rivers and ultimately Lake Michigan would become contaminated if acid mine drainage were to seep into surface and groundwater, posing a significant danger to fish and other aquatic life.”
If you have been reading the press releases from Aquila celebrating the progress of the permitting process, you may be surprised to learn that opposition to the project has been steadily growing to the point where Joe Maki, the head of the DEQ’s mining division has refused to participate in informational meetings before the Menominee and Marinette City Councils because he would rather avoid “a potentially hostile environment” (Penny Mullins, “City council hears mine talk,” Eagle-Herald, June 12, 2017). I have provided a sampling of the news coverage in this packet to document this political reality.
You may dismiss this growing opposition as irrelevant because Joe Maki has stated that public opposition will have no impact upon the mine permit decision. As long as Aquila meets the conditions of the permit requirements, they will be granted permission to mine.
As I pointed out in my last update, this perception is at odds with the growing realization within the mining industry that a social license to operate (SLO) “is an essential part of operating within democratic jurisdictions, as without popular support it is unlikely that agencies from elected governments will willingly grant operational permits or licenses” (Fraser Institute, “What is the Social Licence to Operate (SLO)?” 2012).
As early as 2003, Business for Social Responsibility warned investors “that where there was well-organized, significant opposition to a mining project, no matter their country or political stripe and no matter the prevailing laws, politicians were reluctant to go against
it. In fact, global companies are under greater pressure to respond to broader social expectations today, regardless of the prevailing legal structure, than at any other time in recent history.” (“The Social License to Operate” San Francisco, CA).
Once again, I urge you to review the extensive documentation of community opposition in this packet and make your own judgment about whether this project has a social license to operate.
Al Gedicks, Executive Secretary
Wisconsin Resources Protection Council