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BusinessNorth.com
December 10, 2009

Bitter cold didn't keep them away at Mesabi East High School last night. A Dec. 8 public meeting that provided an overview of the draft environmental impact statement for the proposed PolyMet NorthMet mining project drew hundreds to Aurora, MN.

The draft EIS, four years in the making, provides an overview of potential impacts from the copper/nickel/precious metal mining operation as Vancouver, B.C.-based PolyMet Mining Corp. proposes. The Minnesota Department of Natural Resources and U.S. Army Corps of Engineers are leading the environmental study effort.

PolyMet (TSX: POM; AMEX: PLM) plans to mine and process copper, nickel and other precious metals from an area known as the Duluth Complex, spanning Minnesota's East Iron Range from Hoyt Lakes/Aurora in the southwest to Babbitt in the northeast.

As proposed, the surface operation would extract 91,000 tons of rock per day, producing 228 million tons of copper-nickel-platinum ore and 394 million tons of rock and lean ore over the expected 20-year life of the mine.

While the NorthMet project holds the potential of 400 fulltime jobs, an equal number of spin-off jobs and hundreds of construction jobs, it remains controversial because of environmental damage resulting from precious metals mining elsewhere. Minnesota never has permitted non-ferrous metals mining.

The desired metals are contained within sulfide formations that would be unearthed during the mining process, posing the threat of environmental damage to both ground and surface water. Environmental groups, including Friends of the Boundary Waters, vehemently oppose the project. Here's how the environmental group assesses sulfide mining on its Web site; "It has decimated water supplies, killed fish, destroyed entire landscapes and left taxpayers holding the bag for expensive clean-up almost everywhere it's been done before."

At the Dec. 8 meeting, Steven Colvin, Minnesota DNR environmental review supervisor, acknowledged the potential hazards posed by the project. Sulfate levels in groundwater, which exceed standards and mercury in surrounding wetlands, are some of the potential impacts. He also noted the draft EIS explores alternatives that would mitigate some impacts.

In an interview, Joe Scipioni, PolyMet's president and CEO, said alternatives could be incorporated into the company's proposal during the permitting process. He called the environmental review process "very thorough and comprehensive."

"Sometimes it's a little frustrating how long things take," Scipioni said. "But, we have to make sure that this is done right."

Meanwhile, local politicians and Iron Range Resources Commissioner Sandy Layman remain supportive of the project, its economic development potential and the jobs it would create.

State Rep. Tom Rukavina, DFL-Virginia, said the metals in the Duluth Complex have numerous applications and are in demand. The often-vocal legislator called the project a question of mining here, with environmental safeguards in place, or elsewhere in the world, where lower standards might prevail. "I say we should mine here and mine right," Rukavina said. "I think it's wrong to export that pollution."

Layman said the project potentially would create a mining renaissance on the Iron Range. "We can provide that we can mine non-ferrous minerals safely," she said. "And, that could open up an industry bigger than taconite."

Despite the hotly debated subject, the tone of the Dec. 9 meeting was decidedly civil, due largely to the format. It omitted the usual open microphone format usually present at public input meetings. Those who wanted to comment were directed to stenographers.

Some in attendance criticized the change as a way to quash opposition comments. But DNR officials defended the decision, saying the large crowd would have made the usual one-comment-at-a-time methodology too lengthy.

Finally released Oct. 28, the draft EIS is a milestone in the environmental review process, but an end point could take substantial time. Colvin of the Minnesota DNR wouldn't predict when a final EIS will be finished.

PolyMet's Scipioni said the company hopes to begin construction of the $600 million project during the second half of 2010.

The draft EIS is available on the Web at: www.dnr.state.mn.us/input/environmentalreview/polymet/index.html. The public may comment on the document until Feb. 3. Comments should be mailed to Stuart Arkley, EIS Project Manager, Environmental Review Unit, Division of Ecological Resources, 500 Layfayette Road, St. Paul, MN 55155-4025. Comments also may be emailed: Environmentalrev.Dnr@state.mn.us (reference NorthMet in the subject line).

A second public input meeting in the Minneapolis-St. Paul area is scheduled tonight, Dec. 10, in suburban Blaine, MN.