Officials delay decision on mineral rights leases

Minnesota Public Radio
Stephanie Hemphill 

St. Paul, Minn. — Top elected officials have delayed for a second time the approval of 94 leases to explore for copper, nickel and other valuable minerals in northeastern Minnesota.

The officials faced a barrage of complaints from landowners who were recently notified that the state was planning to lease exploration rights to minerals beneath the surface of their land.

Nearly three hours of sometimes emotional testimony persuaded Gov. Mark Dayton and his lieutenant governor, secretary of state, auditor, and attorney general to postpone approval of exploration leases on private land the Department of Natural Resources had awarded last spring.

Dayton said his administration and the legislature should take six months to review the state's mining policies.

The issue arises because most property owners in Minnesota don't own the minerals below their land. The mineral rights were "severed" years ago, and in many cases the current owner is the state. Minnesota's constitution says the state government should manage the minerals to benefit all citizens.

For years, the DNR has been leasing exploration and mining rights with little complaint. But as worldwide demand grows for copper, nickel, platinum, gold, and other metals, interest in Minnesota for mining exploration also grows.

Gus Axelson, who with his family owns a cabin near Isabella, Minn., said state officials explained to him that according to state law, when a mining company and a landowner can't come to an agreement on how the company can explore for minerals, the mining company can move to condemn the land.

"These mining laws were written long ago, and they're skewed against property owners," Axelson said. "We're asking for Minnesota to have its say at the legislature about whether or not they think it is proper to condemn family homes and cabins in this manner."

DNR officials explained that ordinarily landowners and mining companies do come to agreement, and that condemnation has never been used for this purpose. But Bob Tammen wasn't buying that argument. Tammen is a retired miner from Soudan, Minn.

"Most of the time access to property is granted, and I believe the reason it's granted is because eminent domain is sitting there," Tammen said. "You don't have to use it. If you've got a big enough club, people are going to listen."

Doug Lande is in the unusual position of owning one-third of the mineral rights under his land in Lake County.

Lande was questioned by Secretary of State Mark Ritchie, who asked, "Would you be interested in buying the other two-thirds?" Lande responded, "I would."

Ritchie continued, "Do you think your neighbors would be interested in buying mineral rights?" Lande answered that they would.

But State Auditor Rebecca Otto offered a word of warning.

"For anybody in the room who thinks that might be a possibility, it's not a possibility," Otto said. "The state doesn't allow property owners to purchase their mineral rights in statute currently. It would take a legislative act."

Some property owners said the state doesn't need to sell mineral rights on private property; there's plenty of state and federal land in northeastern Minnesota. Others ask for a fairer balance of power between landowner and mining company.

Frank Ongaro, executive director of the trade group Mining Minnesota, works on behalf of non-ferrous mining companies. He said the DNR and the mining companies followed all the existing rules, so the executive council should have approved the leases.

"That would have sent the best message to the investment community about the interest of inviting investment into the state for mineral development long term, and that didn't happen today."

But the governor said it's time for a public review of old mining laws.

"This is about how do we approach this from the beginning point into the future, if this mining does turn out to be environmentally sound, this will provide a better foundation for future projects to be approved more expeditiously, which will mean more jobs sooner rather than later," Dayton said.

The executive council is scheduled to deal with the mineral leases again in March.