Responsible Metal Mining Will Create Jobs

Minnesota Daily (University of Minnesota)
Opinion: Rolf Westgard

The proposed Iron Range nickel, copper and palladium mines will not damage our tourist industry. It will drain south, which is away from the Boundary Waters area. The project will be more beneficial than not in the end.

Nature gave Minnesota minerals like iron ore and the nonferrous group of copper, nickel, cobalt, palladium and platinum. We’ve dug up most of the iron. However, nestled in a band meandering along the Archean granite of the Iron Range is an undisturbed deposit of nonferrous metals worth billions of dollars and thousands of jobs. Total world annual production of these metals is just 30 pounds or so per person, and the price and demand are rising.

Manufacturing renewable energy products like wind turbines, solar panels, electric vehicles, catalytic converters and smart-grid power lines require these nonferrous metals. Minnesota owns more than 6,000 acres of land in the region, and it stands to collect $2.5 billion in royalties in the coming decades if mining proceeds.

This state property is known as “school trust lands.” Under the Minnesota Constitution, income from such lands is earmarked for the Permanent School Fund, which now contributes about $60 per pupil to every school district.

An analysis by the Minnesota Department of Natural Resources projected that the school fund, with assets of $720 million, could more than triple in size with copper royalties over 25 to 30 years.

Two mining ventures have long-term, federal and state government leases to mine those metals. The largest venture is the open-pit NorthMet Project by PolyMet Corp. of Canada with its partner, the big Swiss metals company Glencore. The other mine is the underground Nokomis Project, a partnership of Duluth Metals of Canada, Twin Metals Minnesota LLC and Chile’s Antofagasta, the world’s largest copper producer.

Environmentalists are lined up in opposition to these projects, viewing them as a serious threat to water quality. The issue is these ores are reactive sulfide minerals. When mined, the sulfur comes in contact with water and oxygen, forming sulfuric acid. It’s possible this acid can dissolve and carry away toxic elements, polluting water supplies in a process known as acid rock drainage.

In the past, acidic, metal-rich waters from mining have damaged the environment when mining companies didn’t follow safe practices. Today, mining companies have to be good stewards of the environment and laws are made to ensure this happens.

In the 1990s at Ladysmith, Wis., Kennecott safely operated an open-pit, copper-sulfide mine 140 feet from the Flambeau River. All surface-area drainage and pit-pumping water was treated, successfully purified and returned to the environment. The pit was backfilled with waste rock to avoid acid rock drainage upon closure.

There were no violations of permits in construction, operation or closure. These are the kinds of practices that are required in Minnesota. Project advocates include U.S. Rep. Chip Cravaack, Sens. Amy Klobuchar and Al Franken and area mayors who want quality jobs for the depressed Iron Range.

The 714-page draft Environmental Impact Statement for the NorthMet Project from the Minnesota DNR and the U.S. Corps of Engineers confirmed good practices and generally is positive about the project. It states that if all commitments are met, there would be no serious impact on the environment.

The following quote from the draft statement on the Partridge River applies to the total area involved: “Even using relatively conservative assumptions, the Proposed Action is not predicted to result in any exceedances of surface water quality standards for the Partridge River at the modeled locations.”

It is time for the dirt to fly.


CEO Without Pretense

Mesabi Daily News
Bill Hanna

J. Andres Morel is a mining man from Chile with a quickly acquired fondness for the Iron Range its people.

It is the rich copper/nickel/precious metals underground in the region that have attracted and lured his native country's large, profitable and respected mining company – Antofagasta – from the slender-shaped nation of the southernmost part of South America to the end-of-the-road in the far northern reaches of the United States.

But it is the area's mining culture and the residents' love of its rich and storied heritage coupled with hope for yet another resurgence of extracting minerals from the ground to better people's lives that have created a strong bond between this modern day prospector with a CEO title and the Northeastern Minnesota community.

"The expectations are high. We know that. And we intend to meet them. But we also intend to be realistic with people. This is a big project and we have a very open strategy. We will be up front. And we will be here for a long time," Morel said during an interview on a recent early morning at the Twin Metals Minnesota's operational headquarters in Ely.

The $2 billion mining venture is in its infancy – prefeasibility status with the permitting process still a couple years away. Yet it has already had a $50 million impact on the Ely area, with more than a dozen employees working its new $1.5 million office; vendors providing supplies; and independent contractors cutting paychecks for those doing exploratory work.

Once permitted, it is projected to create thousands of jobs both in construction work and then permanent positions while in production. And there is great potential for value-added businesses to spring up in the area to access the minerals for new products to be made on the Range and shipped elsewhere.

But while there is a strong hunger for new jobs in the Ely area, there is also a thirst by some preservationist groups and individuals to stop the project, citing environmental concerns from sulfide mining.

Morel and other Twin Metals officials have not shied away from project opponents. Quite the opposite. They have provided plenty of opportunity for interaction and exchange of viewpoints, including a public forum held the night before the Mesabi Daily News interview.

"I think it went well," Morel said of the forum. "There are concerns, we hear them," he said, adding that some of them are rooted in environmental problems from mining in the 1970s. "There were a lot of challenges 30 years ago. There were different standards. Under current regulations we can change that.

"We have a strong commitment to bring the best engineering and science to the project," Morel said.

Twin Metals vows to meet or exceed all state and federal environmental standards; communicate regularly with all stakeholders; minimize land surface impacts; and protect air and water quality.

Morel said the minerals in the various deposits – copper, nickel, cobalt, platinum, palladium and some gold for good measure – are "strategic" metals that a new energy economy for the nation will rely on to improve people's lives while also making the country less dependent on an always unstable global marketplace.

The metals apply to building construction, stainless steel production, air pollution catalyst development, defense applications, medical advances and renewable energy equipment.

"There will be a great demand for the metals in the new economy. They are essential for our quality of life," Morel said.

He said the company has a "long-term vision to build and sustain the project."

Local and state officials have been "extremely helpful," he said. "We have been welcomed in Ely and we have and will return that feeling," Morel said.

State Sen. Tom Bakk, DFL-Cook, has been "a great partner to work with," he said, stressing that the Senate minority leader is beating the drum for value-added businesses for the project.

Iron Range Resources & Rehabilitation Board Commissioner Tony Sertich and Department of Employment and Economic Development Commissioner Mark Phillips have also been helpful and offered their support throughout the development process, Morel said.

Morel is a CEO with no pretense.

Those who work with him say he is easily approachable. And he certainly is in conversation. His eye contact is natural and at ease, reflecting a friendly, easy-going personality. He is direct in answers; evasion does not seem to be in his vocabulary.

He talks with great pride of his native Chile and its mining tradition. Mining is currently doing well in Chile, as is the economy. "Perhaps too well right now," he said with a smile, alluding to some trade issues.

Morel grew up in the most arid part of northern Chile, a narrow country of but 35,000 but with a wide variety of geography and climate ranging from desert-like landscapes to lush green forests to panoramic mountains.

"I have already loved the outdoors. That was part of my first link to mining," Morel said.

Drawn initially to geology, Morel said he was always an engineer at heart. He earned a mine engineering degree from the Universidad of Chile in 1991.

His mining career began as an open-pit mine-boss in the San Cristobal Mine in Antofagasta, Chile. He now has 20 years of mining experience.

He has a love for the profession and a passion to do it right.

"What we do is important … and it's important to do it right," Morel said.


Ingebrigtsen Blames Environmentalists

Alexandria Echo Press

State Senator Bill Ingebrigtsen, R-Alexandria, blames environmentalists for a delay in the state allowing mining companies to explore under some northeastern Minnesota lands.

“The environmentalists, I think, are behind this because they want to slow down any type of mining up there,” said Ingebrigtsen, Senate Environment and Natural Resources Committee chairman.

Governor Mark Dayton led the all-Democratic Executive Council recently in voting to delay for six months considering a proposal to allow mining companies to explore land with state mineral rights in northeastern Minnesota, including under private property.

It was the second delay this year.

Dayton and Secretary of State Mark Ritchie said too many people are unaware of state laws and regulations that allow the state to own mineral rights under people’s homes and cabins.

The proposal the council delayed only would give mining companies the right to see if minerals are present. It would not be a mining permit.

The dispute comes at a time when mining companies want to see if copper and other valuable minerals are in plentiful supply in the Ely and Isabella areas.

The so-called nonferrous mining could be a boon for the area, Ingebrigtsen said, comparing it to the current North Dakota oil boom. 

Twin Metals Donates to Local Food Shelf


In keeping with an annual tradition started by Duluth Metals Corporation in 2007, Twin Metals Minnesota made a large contribution to the Ely Area Food Shelf on Nov. 10. The company donated $3,000 to help the food shelf meet increased demand over the holidays.

“We believe in supporting the community in any way we can,” said Andres Morel, CEO of Twin Metals. “We live in a community filled with hard-working and honest families, and we hope that this donation will help make things easier for local families, and other individuals who are in need of a little help making ends meet this time of year.”

He noted the importance of providing the gift to the food shelf before Thanksgiving and the holiday season, the busiest time of the year for food shelves across the country.

“No one should go hungry during the holidays,” Morel stated.

Erin Heep, chair of the Ely Area Food Shelf board of advisers expressed her gratitude for Twin Metals generous donation.

“Organizers are preparing for an increase in food shelf use during the holiday season and all donations—large or small, food or money—are appreciated very much,” she said.

Money donated to the food shelf will be used to purchase food from food banks at a significantly lower price than grocery stores. The Ely Area Food Shelf is open on the third Tuesday of each month from 12-6 p.m. Community members can make donations or an alternative gift in someone’s name at any time of the year by mailing it to: Ely Area Food Shelf, P.O. Box 786, Ely, MN 55731.

“Twin Metals plans to be in Ely for a long time and we hope to always make a positive influence in the community,” said Morel.

Twin Metals Minnesota, LLC is a joint venture company pursuing the development of an underground copper, nickel and platinum group metals mining project in northeastern Minnesota. It is 60 percent owned by Duluth Metals Limited and 40 percent by Antofagasta PLC.


Dayton Orders Review of Environmental Permitting

Star Tribune (blog)
Baird Helgeson

Gov. Mark Dayton issued an executive order Wednesday calling for a review and plan of action to improve Minnesota’s environmental permitting process.

The governor wants to assess "whatever duplication of oversight there is that can be reduced or eliminated,” Dayton said at a news conference.

The DFL governor asked the Environmental Quality Board to conduct a thorough review and compile a list of recommendations by Nov. 15, 2012.

Dayton wants the board to help simplify the state’s permitting process and wipe out redundancy and confusion. He also directed the state to develop a report card to track and publicize the state’s performance.

Republicans welcomed the governor's call for a review.

"This is a great step in the right direction and I am thankful that Governor Dayton also believes more reform is needed with his recent executive order," said state Sen. Bill Ingebrigtsen, R-Alexandria.

The announcement came about 10 months after the governor issued a similar order directing the heads of the Department of Natural Resources and the Pollution Control Agency to speed the permitting process. The governor asked for decisions on permitting within 150 days after the application was filed.

Dayton’s commissioners reported Wednesday that 96 of permits have met those targets. The only ones that haven’t met the target have generally required complex air-quality reviews, said Minnesota Pollution Control Agency Commissioner Paul Aasen.

Dayton said he doesn’t want the state’s environmental standards “to suffer,” but is trying to ensure that projects that do meet the standards move quickly through the permitting process.

Dayton and Republican legislative leaders have been frustrated by the amount of time it can take for permits to be granted, something both sides said has sullied the state’s reputation among job creators. A signature initiative of Republican legislators early this year was to speed permitting, a cause the governor quickly embraced. In a rare flash of political harmony during the last legislative session, the governor signed the measure into law with Republican legislators at his side.

“What we’ve shown is that Minnesota can promote job growth and industry development by approving permits in a timely manner, while protecting our natural resources at the same time,” Dayton said.


Legislative Group Tours Manganese Mine

Northland Press

Last week, senators from the Senate Environment and Natural Resources Committee visited our region, including a tour of the manganese mining project in Emily. The purpose of their visit was to review projects that may be affected by a new state law that expedites regulatory permitting processes and to see how the committee could strengthen the current regulatory procedures further to insure economic growth.

The group has been instrumental in working on and promoting a legislative bill that streamlines regulatory permitting processes. The bill, Minnesota HF 1, was signed by Governor Dayton in March. Parts of the bill included setting a goal of 150 days for regulatory agencies like the MN Department of Natural Resources (MN DNR) and the Minnesota Pollution Control Agency (MPCA) to either deny or approve permits.

This year Cooperative Mineral Resources (CMR), owner of the manganese project in Emily, conducted a demonstration of how manganese could be extracted using existing groundwater and a single well. That small-scale temporary demonstration took CMR about nine months to receive all the permits required to proceed. It was noted at the meeting that if CMR decides to pursue a commercial operation that permitting would normally take at least three to five years.

In all, the project needed twelve permits and regulatory approvals that resulted in 119 compliance monitoring tasks before, during, and after the demonstration project.

Projects like the CMR manganese endeavor require a lead agency or Responsible Government Unit (RGU), which is responsible for reviewing the entire scope of a project and how each aspect would affect the environment. The RGU for mining in Minnesota is the DNR. Projects are also reviewed independently by all affected regulatory agencies. CMR needed permits and approvals from the MN DNR, the MPCA, the Minnesota Department of Health, the Federal Environmental Protection Agency, the City of Emily, Minnesota Department of Transportation and the federal Mine Safety and Health Administration.

According to Jim Agre, CMR project manager, getting approvals from that many regulatory agencies takes a lot of time and money, and that the necessary public comment periods adds considerable time.

Senator Paul Gazelka, one of the committee members, said several items in the bill help responsible companies move forward in a much more efficient fashion, which should save businesses large amounts of money and time. One such change eliminated the district court review of environmental lawsuits. Historically, a person or group could file litigation against a project and that suit would go to District Court and then an appeals process with several months of delays. The new ruling sends litigation straight to the appellate court.

Also included in the bill is a change increasing the required 25 signatures to 100 for people to petition for an environmental assessment worksheet. The 100 signatures have to come from residents in the state, but Gazelka said he would like to see that changed to a regional requirement.

Representatives from the Emily manganese project talked about their experience and what they foresee happening in the future, should they attempt to promote a commercial mineral extraction project. According to Agre, that process would take some time. Some of that time would be preparing for an Environmental Impact Statement (EIS). New ruling now allows project applicants the right to hire a third party to prepare an EIS. Prior law required the regulatory agency or RGU to prepare it.

Char Kinzer, public relations manager for CMR said, “The tour and meeting was an excellent move on the part of the Senate committee. Previous to our meeting I was not aware that we had such sharp people working for projects like ours in the Senate. They dedicated quality time to hear about our project and are intent on following through with suggestions made. I think their team will play a key role in streamlining the regulatory permitting process and help regulatory agencies work together in a more efficient manner.”

The extraction phase of the demonstration ended in August and currently CMR is studying the results of the project and the grade of the manganese extracted. No decision has been made as to whether to proceed with plans for a commercial operation.

In attendance at the Emily meeting were Frank Ongaro, Mining Minnesota; Paul Thiede, Crow Wing County Commissioner; Senator Bill Ingebrigtsen, R-Alexandria; Senator Paul Gazelka, R-Brainerd; Greg Knoppf, Senate Counsel; Mike Karbo, Committee Administrator, Becky Alery, legislative assistant to Senator Ingebrigtsen; George Pruchinofski, Barr Engineering; Doug Harren, Crow Wing Power; Jim Agre, CMR; and Char Kinzer, Crow Wing Power/CMR.

State, Feds Near Deal for Minnesota Land Trapped in Boundary Waters

Duluth News Tribune
John Myers

A deal is close that could end a decades-long dispute over state land within the federal Boundary Waters Canoe Area Wilderness.

An advisory committee of state and federal officials, environmental groups, logging and mining interests and local government land officials has met quietly several times in the past year to forge a compromise on a combination land trade and purchase.

They’ll meet again in Sandstone on Wednesday as they near agreement on how to handle nearly 87,000 acres of state land locked inside the 1.1 million-acre BWCAW.

Under the deal, the state would trade about 43,000 acres inside the BWCAW for Superior National Forest federal land outside the wilderness.

The federal government also would purchase another 40,000 or so acres of state land in the BWCAW directly from the state. The money — estimated at about $80 million — would go into the state’s permanent school trust fund that funnels interest earned to school districts across the state.

Another 4,000 acres remain in question.

The state land became locked inside the federal wilderness after Congress drew the most recent boundaries of the BWCAW in 1978. At first, Minnesota officials said they welcomed the opportunity to manage their state lands as part of the wilderness. But over the years, state officials say the land has become de facto federal land, with the state unable to cut trees, mine or otherwise develop the property.

Much of the state land in the BWCAW is “owned” by the Minnesota Legislature’s Permanent School Fund. Money earned from school trust fund land, through such activities as logging and mining, goes to help schools across the state, and the fund was getting nothing from the BWCAW property.

For years, some Iron Range lawmakers and representatives of the timber and mining industries have pushed for a straight land exchange to expand state influence in the area while diminishing federally regulated forest.

But because the state land inside the BWCAW is waterfront property and more valuable, that option would have required more than double the amount of forest land in exchange. That would dramatically reduce the size of the Superior National Forest overall — a move favored by some and strongly opposed by environmental interests.

“A straight land trade just isn’t going to happen,” said Ron Nargang a former assistant Department of Natural Resources commissioner and former state director of the Nature Conservancy who serves as a leader for the advisory committee. “But I think we can make this hybrid plan work.”

The committee forging the agreement is an offshoot of the Permanent School Fund Advisory Committee that’s charged with maximizing return for school trust-fund land across the state, including thousands of the state acres in question in the BWCAW.

Any agreement would require approval from the 2012 Minnesota Legislature and money from Congress. Federal money to buy the state land probably would come from the Land and Water Conservation Fund that’s stocked with federal royalties from off-shore oil drilling.

Identifying parcels outside the BWCAW to trade that all sides could agree on has been the key issue, said Wayne Brandt, executive vice president of the Minnesota Timber Producers forest industry group.

“Both the DNR and the Forest Service have developed some reasonable criteria this time to identify candidate parcels for the exchange,” Brandt said.

Much of the federal land being considered for the trade is at the western, southern and eastern edge of the sprawling Superior forest.

The deal was delayed early this year after the influx of new legislative leaders on the overseeing committee, and again in July when state government shut down. But Nargang said the deal already has “buy-in” from the Dayton administration, Republican officials in the Legislature and from the state’s congressional delegation.

A similar plan for the federal government to purchase all the state land died in the mid-1990s when Iron Range lawmakers vetoed it at the last minute, demanding instead to receive land instead of cash in the trade.

“I think we’re as close to something both sides can accept now as we ever will be,” said Bob Krepps, St. Louis County land commissioner, who serves on the committee. “If we don’t do this now, I don’t think it will ever happen.”

Mining foes raise concerns

Some opponents of copper mining in the region have raised flags, saying at least some of the land that would be traded to the state is in areas of high interest for mining companies. Because the newly state-owned land would be under school trust fund management, mining opponents say there will be pressure to maximize return and ignore environmental concerns.

Indeed, one of the criteria that Department of Natural Resources negotiators have asked for is to receive National Forest land in the trade that already has mineral rights owned by the state. That reconnection of surface and mineral ownership would make the land easier to open for mining and remove any federal review from the mining proposals.

“We are deeply concerned about the long-term impact of removing federal protection from high-quality natural land” proposed for the trade, said Lori Andresen, mining chair for the Sierra Club’s North Star Chapter. The group favors a federal purchase of state land rather than a trade. “We believe that the existing level of protection provided to the Superior National Forest should be maintained, and that the goals of the Minnesota School Trust can be most easily achieved by a full federal buyout of trust lands within the BWCAW.”

Nargang and others said minerals exploration potential is considered but hasn’t been a major factor as the DNR and Forest Service sit down to pick parcels for the exchange.

“I don’t see any indication that the lands are being picked specifically or mining,” Nargang said. “The primary objective has been to get land (outside the BWCAW) that the state can manage, that’s contiguous with other state lands and has access … that can provide some sort of return” for the school trust.

Members of the working group on the BWCAW school trust land issue include Nargang, Krepps, Brandt, Betsy Daub, policy director for Friends of the Boundary Waters Wilderness; Jim Sanders, supervisor of the Superior National Forest; Craig Engwall, northeast region director for the Minnesota DNR; Dan Roark, DNR lands and minerals attorney; Frank Ongaro, president of Mining Minnesota, the copper mining industry group; and Tim Dabney, deputy Superior forest supervisor.

Lake, Cook and St. Louis counties also hold land in the BWCAW, as does the permanent University of Minnesota trust fund. Lake County is just completing a land exchange with the Superior forest for much of its land in the wilderness. Nargang said he would support settling the other county and trust land issues at the same time, if possible. 

Commentary Gave Short Shrift to Company’s Safety Record

MPR News
Opinion: Tom Bader 

A commentary published Oct. 26 on proposed mining operations in northern Minnesota mischaracterizes URS, the company I work for.

URS has served the state of Minnesota for over 50 years, and has safely and successfully completed some of the largest, most environmentally sensitive projects in the state and around the country. URS has an exemplary performance record and we place paramount importance on the health and well-being of the public and our staff in everything we do. Here are some facts:

URS has unmatched experience managing challenging, complex assignments and safeguarding local communities. We have assisted the Federal Emergency Management Agency with the assessment and repair of roadways, levee systems and other public facilities following natural disasters. We also work closely with the Environmental Protection Agency to respond to oil leaks, chemical spills and other emergencies around the country that threaten public safety and natural resources. Additionally, we manage some of the federal government's most critical programs, such as safely disposing of the nation's chemical weapons stockpile.

URS is trusted by government agencies and private companies for its environmental expertise. For example, URS has successfully managed the cleanup of major Cold War-era nuclear waste sites, including the Idaho Cleanup Project, one of the largest environmental cleanup projects in history.

URS has more than a century of experience on mining projects around the world. We offer a full range of services, many of them designed to reduce impact on air quality and the water supply. We have an excellent safety record.

URS is a long-term corporate citizen of Minnesota, and we care deeply about the state, its environment and the safety of our fellow Minnesotans. We have successfully completed hundreds of projects in and around the state, recently including several transit projects in Minneapolis, landfill reconstruction and closure projects in Lake Elmo and Duluth, and the restoration of the historic Union Depot in St. Paul.

Unfortunately, the Oct. 26 commentary ignored these points, and focused on the I-35W bridge tragedy. The fact is that after a comprehensive study, the National Transportation Safety Board concluded that the I-35W bridge collapse was caused by a design flaw and compounded by other factors, none of which were the result of URS' work. URS was not involved in the design or building of the bridge, nor was it involved in any of the subsequent construction projects, including the resurfacing work being done when the bridge collapsed.

We appreciate the opportunity to set the record straight. URS is committed to assisting Twin Metals with a safe and environmentally sensitive mine design in northern Minnesota.


We Have Great Mining and Environmental Science; Now Let’s Use It More Efficiently


As explained on Page 19 in this edition of BusinessNorth, one of Gov. Mark Dayton’s key business initiatives now faces a field test: Can Minnesota regulators perform, as Dayton termed it, “at the speed of commerce.”

Reaching that goal is critically important. The need for speed is a reality. The Iron Range could lose a proposed Magnetation development – plus related construction and permanent jobs plus spinoff business with vendors – if other states are more efficient at reviewing and issuing permits for a new pelletizing plant. And lest Twin Ports residents forget, a strong Iron Range makes Duluth-Superior hum.

Wisconsin is at the same juncture. With Gogebic Taconite in the early stages of penning a mine proposal, state legislators have an opportunity to streamline the permitting process. The alternative is to endorse the existing bureaucracy, which is outdated, pathetically slow and repels investment at a time when we need it the most.

This is not a call to abandon environmental protections, as some might claim. Nobody knows better than resident up north that our pristine wilderness must be preserved for future generations. In fact, northern Minnesota and Wisconsin residents are far better positioned to understand their surroundings than the metro dwellers. We enjoy our forests, lakes and streams daily, not just a few summer weekends as an escape from the gritty urban rat race.

Decades of mining have proven it can be conducted in an environmentally friendly manner. A vast body of knowledge exists to guide regulators through the permitting process. Scientists, geologists and engineers are available at the government and corporate levels to assess environmental impacts in a timely manner. We don’t need to re-invent the wheel every time a new project emerges.

Gov. Dayton deserves credit for his efforts to light a fire under regulators and his own administration to serve northern Minnesota. Now, let’s hope he can put feet on the ground to make his philosophy work. Wisconsin should do the same. In the weak U.S. economy, mining is a shining star at a time when the third world needs our resources. The window of opportunity won’t remain open indefinitely.