Mining industry has big plans for the western UP and beyond | Steve Garske

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The rush is on for the copper, silver, nickel, and other hardrock minerals of the Lake Superior region, and especially Michigan’s Upper Peninsula. One of the latest arrivals to the UP is the recently-formed Highland Copper Company, Inc. This month geologist and Highland Vice President for Exploration, Dr. Ross Grunwald, has been on tour, giving a detailed powerpoint presentation of the company’s activities and plans in Ontonagon, Ironwood, Calumet and Houghton.

Highland Copper Company is a Canadian company based in Longueuil, Quebec. Along with its wholly-owned subsidiary Keweenaw Copper Company, Inc., the company is “focused on exploring and developing copper projects within the Upper Peninsula of Michigan, U.S.A.” Incorporated about 2 ½ years ago, they now have 21 full-time employees. They are currently exploring four deposits – three in the Keweenaw Peninsula, and another near Bald Mountain, north of Ironwood near Lake Superior. They are also in the process of buying the White Pine facility and mineral rights from Copper Range Co., a subsidiary of First Quantum Minerals LLC of Canada. Drilling is being done at all these sites. As noted in this January 10th Globe story, the drilling at Bald Mountain was not generally known until Grunwald mentioned it at the Ironwood meeting.

Grunwald explained that at this point the Highland (and Keweenaw) Copper Companies are mining exploration and development companies, not mining companies. If the prospects turn out to be economically viable, they would likely be sold to other companies that would mine them. The company provided a fact sheet with a map of their projects. Their extensive website has a fair amount of information about the company, including the results of drilling done so far.

Grunwald and his partners are not the only ones that believe there’s money to be made from these prospects. Highland has been wildly successful in raising investor funds, bringing in some $25 million since September 30th in a stock offering of 43 cents per share. The money will go to continued exploration, as well as the purchase of the White Pine mine. Grunwald stated that the if and when White Pine is reopened, a new underground mine would be constructed to access the extensive copper deposits northeast of the present mine. The tailings would be backfilled into the old, water-filled mine. While smelting would not be done at White Pine, some concentrating of copper ore could be done there using staged flotation reactor technology. Meanwhile the company’s stated intent is to continue to explore for copper and other minerals throughout the Keweenaw region.

In their online “Corporate Presentation” the Highland Company notes that Michigan has a favorable political climate for mining. Their list of “favorables” includes support from the Governor and local officials, new laws encouraging mining and making Michigan a “right to work” state, and a “supportive” Michigan Department of Environment Quality staff. They state that local citizens favor development but admit that some “have questions.”

When asked at the Ironwood presentation whether Highland Copper Company had any financial ties to billionaire Chris Cline of Florida, Cline’s GTac corporation, or the Houston-based Natural Resource Partners (NRP), in which Cline is a major investor, Grunwald gave a flat-out “No.” A bit of research, mostly of these company’s own website, reveals a complicated web of connections, though.

As mentioned in several places on their website, Highland has entered into a joint venture partnership with an entity called Bowie Resource Partners LLC (BRP LLC). As stated on the website, BRP owned approximately 8.8 million mineral acres in 29 states, including approximately 60,000 gross acres of copper rights in the Upper Peninsula of Michigan as of 2011. BRP LLC is a joint venture formed in June 2010 between Natural Resource Partners L.P. (NRP) and International Paper (IP). Both companies are listed on the New York Stock Exchange. Once mainly invested in coal, BRP’s holdings now include everything from oil, gas, and mineral rights to water rights and cell tower placement rights.

According to one source, Chris Cline owns 31% of NRP. As outlined on NRP’s website and their prospectus, NRP is the managing and controlling partner of BRP with a 51% interest, with IP controlling the remaining 49%. Furthermore, oilman Russell Gordy of Houston, owner of RGGS Land and Minerals LLC, sits on the NRP board of directors. RGGS owns most of the surface and mineral rights leased/optioned to GTAC in Iron County. BRP owns and manages current mineral leases, and manages the development of the more than 7 million acres of former International Paper land. Thus Highland has a joint partnership with BRP, which is controlled by NRP, of which Chris Cline (owner of GTac) is a major shareholder.

There can be little doubt that the descent of multiple mining companies on the UP and states west is a well-planned, well-funded effort by incredibly wealthy investors to turn the Lake Superior region into a major resource extraction zone, similar to the Appalachians of West Virginia (where Cline got his start in the coal industry). The question is whether the citizens of the region will let him.

(For more on the financial connections between Cline, GTac and NRP, check out the well-researched article “Circles of Friends – Spheres of Influence“ posted December 10, 2013.)

Steve Garske is a Board Member of Save the Wild U.P. and can be reached at steve [at] savethewildup.org.

Economist presents results of copper mining study

The Daily Mining Gazette | November 6, 2013
By Garrett Neese  - DMG writer (gneese@mininggazette.com)

HOUGHTON – Despite the economic benefits of mining, the instability and other drawbacks mean the western Upper Peninsula is better off looking elsewhere for prosperity.

That conclusion was reached by Thomas Power, who presented the results of a recent study on the economic impact of copper mining Tuesday night in the Upper Peninsula. Power, a research professor and former economics department chair at the University of Montana, prepared the report for Friends of the Land of Keweenaw, an environmental advocacy organization.

Power appeared at Michigan Technological University Tuesday as part of its Green Lecture Series.

Garrett Neese/Daily Mining Gazette
Thomas Power, a research professor and former economics department chair at the University of Montana, delivers his talk “The Economic Anomaly of Mining: Treasure and Tears” at Michigan Technological University Tuesday night.

In his report, he argues the western U.P. should concentrate on “economic gardening” – supporting start-up and existing businesses – and protecting and enhancing environmental amenities and other “quality of life” assets.

Power said he doesn’t have any animosity toward mining. He came from a metal mining family, and spent the first 18 years of his life falling asleep to the “soft thump” of the Bay View Rolling Mill in Milwaukee. But in many cases, the drawbacks of mining outweigh the positives.

Mining grew popular because of some very real economic benefits: the ability to extract valuable minerals, the high wages for workers – at times, averaging 40 percent higher the average working wage – and the tax revenues for municipalities.

However, any positive impact is tempered by instability, Power said – not just the familiar boom-bust trajectory, but the “flicker.” That occurs as prices in the international metal markets fluctuate, affecting the mine’s profitability. In turn, the mines compensate by reducing the labor force.

“It’s one thing to talk about high wages, but if the high wages are unreliable, the impact of those high wages on the local economy is going to be different than wages people think that they can count on,” Power said.

Technological advances have made mineral extraction more feasible in spots. But the increase in productivity has also reduced the number of employees neede. From 22 workers in 1970, the number needed to produce a thousand megatons dropped to six in 2004, rebounding slightly for unknown reasons to 10 now.

Because the mining job paid better than most of the alternatives laid-off miners are likely to find, they’re more likely to stay around the area and hope to be rehired, Power said.

“They hang on, hoping to be rehired,” he said. “Instead, what they see is more people being laid off.”

The economic benefits to mining are often least felt in the immediate area. Because of their high wages, miners can afford to live in more upscale areas. Often, they don’t want to live near the mine, where environmental degradation or the end of the mine can hurt property values. That potential for instability also discourages investment in local infrastructure, such as schools.

Power didn’t call for an end to mining, but said residents should apply the same kind of cost-benefit thinking mining companies use when they approach projects.

“We have to make choices, and we have to make choices because there are costs as well as benefits,” he said. “What citizens have to do, from a public interest point of view, is to weigh the clear economic benefits associated with mining, but also recognize the potential cost to the community, then make their decision and urge their representatives in government to do the same thing.”

William Keith of Houghton said he hadn’t known miners would commute so far for work.

“I thought it was an engaging presentation,” he said.

Permalink: http://www.mininggazette.com/page/content.detail/id/531850/Economist-presents-results-of-copper-mining-study.html?nav=5006

Full report available at http://www.folkminingeducation.info/wp-content/uploads/2013/07/Minings-Economic-Impact-on-Western-UP1.pdf

Rio Tinto Targets Clean Water Advocates in Wisconsin

-by Laura Gauger, Legal Affairs Coordinator, Wisconsin Resources Protection Council, October 30, 2013

Back in 2007 the Wisconsin Resources Protection Council (WRPC; Tomahawk, Wisconsin) embarked on a mission to hold Flambeau Mining Company (FMC) accountable for water pollution problems caused by the company’s Flambeau Mine near Ladysmith, Wisconsin. FMC, at one time managed by Kennecott Minerals (Salt Lake City, Utah) is a wholly owned subsidiary of Rio Tinto (London, UK).

This project was never just about us here in Wisconsin … it was about trying to help clean water advocates in the entire Great Lakes region and beyond protect their own waters from adverse impacts linked to sulfide mining operations.

As you know, the mining industry has held up the Flambeau Mine to YOU, the people of MinnesotaMichiganWisconsinAlaska and who knows where else around the world as an example of “environmentally responsible mining” in efforts to convince you to “let them in” and mine in YOUR communities. Our lawsuit was meant to bring out the facts about the serious pollution problems at the Flambeau Mine site and thereby debunk the myth of the “environmentally responsible” Flambeau Mine and give you ammunition to use in your own battles.

We scored a partial victory in 2012, when we took FMC to federal court over violations of the Clean Water Act and the U.S. District Court for the Western District of Wisconsin ruled, among other things, that the company had indeed violated the Act on numerous counts at the Flambeau Mine site.

Unfortunately, however, FMC appealed the decision, and the U.S. Court of Appeals for the Seventh Circuit proceeded to let the mining company “off the hook.” The Court remained silent on whether or not FMC had violated the Clean Water Act. Instead, they ruled that the mining permit issued to FMC by the State of Wisconsin “shielded” the company from prosecution and that we therefore could not enforce the Clean Water Act against FMC (even though the company had indeed violated the Act, as determined by the U.S. District Court).

In the process, no one was held accountable for the fact that the Flambeau Mine has polluted a tributary of the Flambeau River to the point where theWisconsin Department of Natural Resources (DNR) has recommended to the United States Environmental Protection Agency (EPA) that the stream be listed as “impaired” for copper and zinc toxicity linked to the mining operation. And absolutely NOTHING has been done about the high levels of toxins (most notably manganese) in the groundwater at the mine site. You see, groundwater pollution at mine sites in Wisconsin has been legalized by the Wisconsin DNR and State Legislature (see NR 182.075, Wisconsin Administrative Code), so we could not argue that point in either state or federal court.

The latest twist is that FMC, owned by one of the wealthiest multinational mining corporations in the world (Rio Tinto), is “going after” WRPCLaura Gauger and their fellow plaintiff (Center for Biological Diversity; Tucson, Arizona) to recover various “costs” the company accrued in the lawsuit … to the tune of $157,000.

Our lawyers are fighting the dollar amount demanded by FMC, but it appears we will be required to pay FMC/Rio Tinto many thousands of dollars.

Stay tuned.

Permalink: http://flambeaumineexposed.wordpress.com/statement/

 

New highway proposed for Eagle Mine

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Looks like Lundin Mining inherited a transportation route mess from Rio Tinto when it bought the Eagle Mine located 30 miles north of Marquette.

The Marquette County Road Commission (MCRC) is considering a plan to use eminent domain to seize private property to build a new 55 mph highway from CR 550 (“Big Bay Road”) to the Eagle Mine. The MCRC has said it wouldn’t be making these improvements if not for the Eagle Mine, making it illegal to use eminent domain for the benefit of this multi-national mining company. Area property owners and residents are speaking out against the highway and the threat of eminent domain.

This is not a plan for road upgrades, this is a plan for a brand new highway — and we must speak out! Check out the proposed route changes to the Triple A and CR 510 and responses to questions raised at the recent public hearing. Area residents deserve a new Public Hearing to weigh in on the new proposed upgrades.

The MCRC modified the proposed realignment based on public outcry. But the process is on an accelerated path; as the MCRC approved its plan modifications at the same meeting the modifications were proposed.

Your voice is important! Write a letter to the editor, or call your local Marquette County Commissioner to discuss the proposal for a new highway.

Meanwhile, the City of Marquette is struggling with Lundin Mining’s plan to run ore trucks through the city and Northern Michigan University’s campus. In July, the City Commission’s request to the Michigan Department of Environmental Quality (MDEQ) to have transportation be considered part of the Eagle Mine’s permit was denied, which would have forced the mining company to mitigate environmental impacts of truck traffic in Marquette.

Though the Lundin Eagle Mine says they’ll only increase total truck traffic by a small percentage, these trucks will be filled with ore, increasing the weight on the roadways by an estimated 50%. This poses not only a financial burden on taxpayers for years to come, but, more importantly, a huge safety risk for our communities.

** Update** The City of Marquette Public Hearing was cancelled. We are disappointed that the City of Marquette has chosen to postpone tomorrow’s Public Hearing on a truck ordinance en lieu of private meetings with Lundin Mining Company.

Stay up-to-date with these rapidly-evolving issues by checking out our FB page at Facebook.com/SavetheWildUP — together we will keep da U.P. wild!

In victory at Crandon, lessons for a new proposal | Al Gedicks and Dave Blouin

Oct. 9, 2013

The end of this month, Oct. 28, marks the 10th anniversary of the historic victory over the controversial Crandon mine project adjacent to the Mole Lake Sokaogon Chippewa Reservation.

Veterans of that 28-year (1975-2003) battle against the Crandon metallic sulfide mine will gather on the Mole Lake Reservation on Oct. 26 to commemorate the grass-roots environmental, sportfishing and tribal victory over the world’s largest energy company (Exxon) and the world’s largest mining company (BHP Billiton).

Situated at the headwaters of the Wolf River, the proposed underground shaft mine was one mile upstream from the tribe’s wild rice beds, five miles from the Forest County Potawatomi Reservation, and 40 miles (via the Wolf River) upstream of the Menominee Nation. The mine would have destroyed Mole Lake’s wild rice beds and threatened the tourism industry downstream on the Wolf River.

In the end, the Mole Lake Chippewa and the Forest County Potawatomi tribes purchased and divided the 5,000-acre Crandon mine property for $16.5 million. Mole Lake acquired the Nicolet Minerals Co., and quickly dropped mine permit applications. The land is now managed as a conservation area devoted to sustainable land-management practices, tribal cultural values and tourism suitable to this environmentally sensitive area.

The international mining industry was shocked when a broad multiracial, rural-based grassroots alliance defeated the world’s largest mining corporation. How could such a movement overcome the superior financial resources, and political access to decision-makers in the Wisconsin Legislature, governor’s office and the Department of Natural Resources?

Dale Alberts, president of Nicolet Minerals, a subsidiary of BHP Billliton, acknowledged that “a major problem in the beginning was the company did a poor job communicating to the local people. Environmental groups got out ahead and frightened people.”

But what really frightened people was the prospect of acidic mine waste piles 90 feet deep and covering 355 acres at the headwaters of the pristine Wolf. Native and non-Native groups mistrusted the DNR to defend their rights and found that tribal environmental regulations were stronger than state laws in protecting the Wolf River’s tourism economy.

After the Crandon defeat, the mining industry urgently discussed the need for a “social license to operate” where the mining companies work to win broad social support for their extractive activities. The failure to obtain such a social license raises the political and financial risks of a project and can often lead to the defeat of a mining project by widespread community opposition.

This is exactly what happened at Crandon and what is now taking place in the Bad River watershed where Gogebic Taconite has proposed a mountaintop removal operation to create the largest open pit iron mine in the world upstream from the largest remaining wild rice wetland in the entire Great Lakes basin on the Bad River Ojibwe Reservation.

GTac has followed Exxon’s strategy by using its financial and political power with the governor and the Legislature to write its own mining law, severely limiting citizen and tribal participation in the permitting process, and militarizing the mine site by deploying masked security guards with automatic weapons to intimidate the public.

The most recent public opinion survey from the University of Wisconsin-Superior shows that nearly two-thirds of the people in a random poll in Iron and Ashland counties oppose the mine project.

From the perspective of the mining industry’s own standards for a viable mine project, this project is dead in the water.

Al Gedicks of La Crosse is executive secretary of the Wisconsin Resources Protection Council. Dave Blouin of Madison is the Mining Committee chair of the Sierra Club-John Muir Chapter.

Permalink: http://www.jsonline.com/news/opinion/in-victory-at-crandon-lessons-for-a-new-proposal-b99116285z1-227139641.html#ixzz2k4R9Uitz

60-Day Notice to Sue the Environmental Protection Agency for regulatory failure at Eagle Mine

MARQUETTE — On Monday, June 24, 2013, Jeffery Loman, a Keweenaw Bay Indian Community member and Save the Wild U.P., a grassroots environmental group based in Marquette, filed a 60-day Notice to Sue the Environmental Protection Agency for violations of the Clean Water Act at the Eagle Mine near Big Bay, Mich.According to Loman, a former federal regulator with the Bureau of Ocean Energy Management in Alaska, the EPA failed to require a National Pollution Discharge Elimination System (NPDES) permit for treated mine water discharges at Rio Tinto’s Eagle Mine. In 2010 Rio Tinto told the EPA that the discharges from the revised treated water filtration system were not below the surface of the ground. The State of Michigan issued a groundwater permit while acknowledging that these discharges would actually flow into the East Branch of the Salmon Trout River.

Both Loman and Alexandra Thebert, executive director of Save the Wild U.P. agreed that “the decision to file the notice to sue was done after great circumspection and careful review of what is occurring at the Eagle Mine.”

“We seek to correct what is nothing short of a regulatory fiasco at the Eagle Mine. This is just the first step in a multifaceted plan to do that in full measure — we are also calling for a federal investigation of the relationship between State of Michigan regulators and the mining industry,” said Thebert.

“In order to protect our communities and environment, we must ensure that regulations are followed,” said Margaret Comfort, Save the Wild U.P. president. “Rio Tinto — and other mining companies — cannot operate outside the law.”

The 60-Day Notice to Sue was sent by certified mail Monday, June 24 at 2:00 p.m. EST. The notice went to the Acting Administrator of the EPA in Washington D.C., the EPA Region 5 Administrator in Chicago, the U.S. Attorney General, the Governor of Michigan, and Rio Tinto’s Eagle Mine President Adam Burley.

Citizens rally, demand corruption investigation of collusion between state regulators and mining industry

MARQUETTE —  Local residents, including KBIC tribal members, Concerned Citizens of Big Bay, and Save the Wild U.P., rallied at a joint press conference on Saturday June 8th, calling for a corruption investigation related to activities of an unusual ‘non-profit’ corporation, the Northern Michigan Geologic Repository Association (NMGRA), based in Marquette County.Nearly two dozen citizens spent Saturday afternoon in the Michigan DEQ parking lot, holding hand-lettered signs that outlined corruption concerns, speaking with locals driving by, participating in a question-and-answer session, and reviewing the murky facts surrounding NMGRA.

While Rio Tinto was in the process of planning and constructing the mine at Eagle Rock, high-ranking State officials directly charged with enforcing mining safety and environmental regulations formed the Northern Michigan Geologic Repository Association as a ‘non-profit’ corporation. The NMGRA Board of Directors features Rio Tinto and Bitterroot Resources mining executives alongside DEQ officials. At the same time, these state officials were failing to enforce environmental and safety regulations enacted to protect the health and well-being of U.P. citizens.Rio Tinto claimed it needed a 10 megawatt substation and miles of private power lines to electrify the core shed adjacent to the Eagle Mine site. However, once the power had been installed, the core shed was deemed unnecessary, and Eagle Mine was electrified instead — a bait-switch move that sidestepped permitting, due process, and public participation.

“The citizens of Michigan have consistently been denied access to information with regard to this so-called non-profit. Today we are pulling back the veil of secrecy,” explained attorney Jana Mathieu, who filed requests for information related to NMGRA which went unanswered.

Jeffery Loman, KBIC tribal member and former federal oil regulator, led the group on a walking tour of a large cinder block warehouse building located nearby, identified by signage as a “State Warehouse.” The property is actually leased by the nonprofit Northern Michigan Geologic Repository Association, and serves as its core shed, housing valuable core samples. Local workers report seeing only Rio TInto vehicles accessing the warehouse.

“This core shed symbolizes Rio Tinto’s end-run around Part 632, the legislation governing non-ferrous mining in Michigan,” said Loman.

“Something smells bad here. Why create a private non-profit to perform a function of the State of Michigan? The circumstances surrounding these dealings between State officials and mining companies look like a bad rash on this administration,” said Loman. “Sunshine is the best disinfectant. Hopefully Governor Snyder will agree.”

“This is a barrel of rotten apples,” said Mary Ellen Krieg, resident of Big Bay.

“As things stand, there’s no plan for any independent review of the quantity, content and grade of the ore removed at Eagle Mine. Essentially, that means the State is allowing Rio Tinto to self-report its income which serves as the bases for the taxes due the State. The DEQ’s Hal Fitch will just take Rio Tinto’s word for it, and in turn, Hal Fitch wants every taxpayer in Michigan to take his word for it,” explained Michelle Halley, an attorney based in Marquette.

“Great place for hiding something. It looks totally neglected. Here’s this big building covered with peeling paint, surrounded by invasive knapweed and erosion gullies — anyone driving by would assume it was a giant meth lab, not a top-secret core shed set up by mining executives and controlled by the Michigan DEQ,” says Gene Champagne of Concerned Citizens of Big Bay, a grassroots group which has been active in monitoring regulatory oversight of Part 632, the legislation governing non-ferrous mining in Michigan. “The more you look into this, the more it looks like either incompetence or fraud or even both.”

“There are serious concerns about the connections between the mining industry and the regulatory role of the state,” agrees Alexandra Thebert, Executive Director of Save the Wild U.P. “In the best interest of all Michiganders, we are calling for the Department of Justice to investigate.”

Save the Wild U.P. is a grassroots environmental organization dedicated to the preservation of the Upper Peninsula’s unique cultural and natural resources.

Local citizens skeptical of Rio Tinto Eagle Mine “Community Forums”

As Rio Tinto continues another round of community forums, local citizens voiced their skepticism surrounding Marquette’s Rio Tinto Eagle Mine Community Forum Tuesday.

“Rio Tinto portrays this data as scientific — but that could not be farther from the truth,” said Kathleen Heideman, vice president of Save the Wild U.P. “Their ‘data’ from the last round polled less than 300 people– hardly representative of the 76,502 residents of Marquette and Baraga counties. It’s a global mining corporation’s idea of democracy: first they show slides about how great they are — then we should click to indicate our agreement. That’s meaningless. It’s not voting.”

“I am surprised to see the addition of 30 miles of power lines referred to as ‘more wood on the woodpile,’” said Margaret Comfort, president of Save the Wild U.P. “Rio Tinto manipulated the public process by saying they needed 30 miles of power lines for mining exploration and then sought a small modification to their Eagle permit to bring the lines to the mine site. It might be illegal, and it’s definitely unethical. They should have had their Eagle Mine permit modified, which would have included public scrutiny to discover if the public approved of this action.”

“Rio Tinto touted 75 visitors to Eagle Rock as demonstration of their willingness to work with Native Nations. But we know full well that Rio Tinto placed the mine portal into Eagle Rock for one reason and one reason only: They knew that this would draw the attention away from what all Upper Peninsula residents value — water,” said KBIC tribal member and former federal oil regulator Jeffery Loman. “That worked yesterday but from this day forward we will, as guided by our Great Spirits, bring the attention squarely back to the protection of our waters and everything that depends on water.”

“Rio Tinto representatives announced the life of the mine has been extended to 8 years by discovering a 20 per cent increase in ore, but that’s no career for the people working in the area. The U.P. needs and deserves stable jobs to support families and send kids to college, not layoffs and short-term work,” said Alexandra Thebert, executive director of Save the Wild U.P. In early April, Eagle Mine announced the layoffs of 11 employees and downsized contractors by 20 per cent citing “economic headwinds.”