Minnesota has a long history of mining. However, most of that has historically been for iron from the state's large Banded Iron Formation deposits in the northeast portion of the state. That industry has been in general decline for a variety of economic and demographic reasons, and there is far less mining in the state than there used to be. Enter Polymet (and a few other entities like Twin Metals). These companies want to come into the state and engage in hard rock mining for copper, nickel, zinc, cobalt, and other precious and semi-precious metals. This is a very different and far more destructive form of mining that has a history of water pollution (due to the reaction of sulfides in the parent rock with air and water when exposed). Given the incredibly sensitive nature of the wetland heavy, hydrologically complex area, this is an incredibly dangerous and ill-advised plan.
Mining is a legally complex industry that also happens to have a number of privileges. First, mineral rights are what is called a "dominant estate." This means that the owner of the mineral rights (in Minnesota this is often, but not always, the state itself) has the right to explore and develop the deposits with reasonable use of the surface. While the law in Minnesota is less developed than in other states, particularly those with large oil and gas industries, the majority rule (most states have adopted) allow the use of any portion of the surface that is appurtenant to the development. This includes access roads, drilling and development pads, the harvesting of timber, the redirection of surface water, and the "reasonable" appropriation of other surface assets. While it does not allow for the outright destruction or eviction of a surface owner or tenant, development actions can sometimes result in a constructive eviction or total occupation. Whether this is allowed or actionable depends on state law and the exact facts of each situation.
Second, mineral rights are almost impossible to develop, economically, without pooling. Isolated or small parcels are generally uneconomical to develop either due to logistics or due to the efficiencies of scale required to support the large capital investment required to open a mine. This means that a mining company will often work with multiple mineral owners to acquire all of the parcels required. This creates a patchwork of interest holders that have all sold or leased their rights to the same company. It also provides an opportunity to prevent development by withholding or blocking transfer of rights held by a major or critically located rights holder. This is what may be happening with Twin Metals, which hopes to open a sulfide mine three miles from the Boundary Waters Canoe Area Wilderness, but was recently opposed by Governor Mark Dayton. While this would only affect state mineral rights, it could be enough to render the project uneconomical and kill it.
So where are we with Polymet? The mine has been in the works for years, and has been steadily losing public support as people learn more about the large potential consequences and small economic benefits. What was recently approved was not the mine itself. Rather it was the environmental impact statement (EIS) for the required land swap that would trade state land to be mined for private land outside the mining area. While not entirely unexpected given Gov. Dayton's recent comments, it is disappointing. It has also been a long process, with an initial review by the EPA outright rejected in 2009 as inadequate (and portions of the current review still awaiting Army Corps of Engineers review). This will almost certainly be subject to litigation as the project moves into its permitting phase (which will also be lengthy and have its own litigation fights). It is also possible that the project dies for lack of funding. Lower copper prices, a money-losing parent company, and a risk-heavy, speculative business model all make the project a financially unstable proposition. It is possible that additional regulatory and litigation costs in both time and dollars could be enough to sink the project. And even if that is not enough, there is still the matter of the mine reclamation bonding...
Mine reclamation bonds, in theory, are money that is put up by a company before construction begins to fund the closure, remediation, and perpetual treatment of a site. They are almost always required in modern mining after a history of companies abandoning mines, closing them without cleaning up, or going bankrupt. There are also well-documented examples of bad actors with poor records claiming a need to resume production in order to fund health, safety, and environmental compliance. These problems have resulted in mines becoming toxic, polluted wastelands, many of which ended up on the federal Superfund National Priorities List, including some of the most (in)famous. The problem with reclamation bonds is that they are very difficult to set. The state has hired an environmental consulting firm to determine the required level of funding required for the cleanup insurance fund. I wish them the best of luck, but their task is almost certainly hopeless. While some costs can be estimated based on past results, practices, and known costs from similar projects, there are many others that are unknowable or have huge uncertainty ranges. The first problem is understanding the hydrology itself. Northern Minnesota is an incredibly complex and interconnected area with lots of braided streams, wetlands, overland flow, and mysterious water courses that apparently disappear. I am incredibly skeptical that it is possible to model such an area with enough confidence to arrive at a good cost estimate for perpetual treatment. And even when the hydrology is modeled correctly, estimates of actual water treatment levels required have been notoriously bad. Following all of the analysis and uncertainty, the setting of actual bond values has also been problematic. This is true whether the mining is for coal (regulated differently) or is hard rock mining (like in the case of Polymet). Around the world, mining bonds have proved inadequate and left local, regional, and national governments responsible for massive, perpetual cleanup costs.
So, there are still many opportunities to stop the Polymet mine. They have only had the state approve their EIS for the land swap. The federal EPA and ACE still need to sign off, the EIS then needs to survive litigation. After that, while they would have the right to extract their mineral rights, they would still be subject to (ideally) strict (and expensive) regulations and permitting requirements. Each of which can be another good stage for opposing the project, litigating, or imposing public and environmental conditions on the company's behavior. The surety bond process will also be a good opportunity to impose costs on the project, and history has shown that it is probably not possible to demand enough money up front, so a strong public push for high numbers could be very helpful. Finally, it is possible that the project collapses under its own weight, with uncertain finances and high costs. The longer the process can be drawn out, the more likely this is to happen. So get involved, write to the Governor and legislature, and provide feedback on the bonding and permitting process. Every little piece helps. Together we can stop this grave threat to a unique and vulnerable place that has so far been preserved for the benefit of all Minnesotans. It would be a shame to sell that out for a handful of dollars a few temporary jobs.
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