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PolyMet submits first permits for copper mine

A PolyMet Mining official explains in December 2013 how the company will use rod mills, one of which is at right, to crush metal-bearing rock from 1/2-sized pieces to small pieces of gravel as part of the process of extracting copper, nickel and other metals from the planned mine. The mills are part of the old LTV processing plant now owned by PolyMet. (News Tribune file photo)

PolyMet Mining Co. on Monday submitted the first three permit applications for its proposed copper-nickel mine outside Hoyt Lakes.

The company submitted a water appropriations permit to the Minnesota Department of Natural Resources, a water pollutant discharge permit to the Minnesota Pollution Control Agency and a tailings basin dam safety permit to the DNR.

They are the first of nearly two-dozen permits from state and federal agencies the company needs before it can start building a mine near Babbitt and refurbishing a processing plant at the old LTV Steel Mining Co. site near Hoyt Lakes.

“We’ll have most of the applications in as the summer goes on, if not all of them,’’ said Bruce Richardson, PolyMet spokesman, saying the first permits mark another landmark for what would be the state's first ever copper-nickel mine.

The most critical of the permits — and the most controversial — will be the DNR-issued “permit to mine” that will lay out how the company can proceed with unearthing the mine, moving and processing the ore and dealing with any polluted water at the site. That permit also will dictate how much money PolyMet will be required to set aside as an insurance policy should any problems occur.

The company hopes to have all the permits approved and work started in 2017, along with securing financing to pay for the project, and then start mining about 18 months after construction begins.

The applications are “another important milestone for PolyMet and the NorthMet Project,” said Jon Cherry, PolyMet president and CEO “We recognize that water is one of Minnesota’s most valuable resources and we have taken extra time and effort to ensure that our permit applications detail the ways in which we will protect this resource and meet the various regulatory standards required for Minnesota’s first copper-nickel mine.”

Critics said Monday that PolyMet is proposing “to re-use a leaky 40 year-old dam left behind by previous tenant LTV Steel to hold back their tailings pond,” adding the project will remain risky because of potential dam failure sending tainted mine waste downstream.

“PolyMet’s proposal is too risky for Minnesota and the Lake Superior watershed where it lies,” stated Kathryn Hoffman of the Minnesota Center for Environmental Advocacy.

The permit applications come after the March decision by Minnesota Department of Natural Resources Commissioner Tom Landwehr that his agency's decade-long environmental review of the proposed PolyMet copper mine project was legally "adequate."

That decision signaled a transition away from environmental review and toward developing details of how the state's first copper mine might be built and operate, although it’s still possible that the state and PolyMet could hit a snag on details of a permit that could unravel the project.

Richardson told the News Tribune last week that he doesn’t think that will happen.

“I don’t see any major’’ differences or roadblocks that might stop the project's progress, he said.

The final environmental review report concluded that PolyMet operations won't raise downstream sulfate levels or harm wild rice, won't send tainted groundwater north toward the Boundary Waters Canoe Area Wilderness as some critics have suggested and won't violate downstream mercury limits in the St. Louis River watershed.

The DNR concluded that PolyMet could operate within all current state and federal pollution standards — that the the project won’t have impacts but that those impacts will be small or manageable.

Critics disagree with those conclusions, saying key elements of the environmental review are based on faulty data or false assumptions, rendering the conclusions invalid. They say the project should be stopped because of the inherent danger that acid-bearing rock will spew pollution downstream into the St. Louis River watershed that leads to Lake Superior.

PolyMet is proposing an open-pit copper mine, with processing at the former LTV Steel Mining Co. taconite plant. The project, estimated at $650 million to build, would employ about 300 workers for about 20 years.

Supporters say the jobs would help diversify the Iron Range economy that is tied to the cyclical iron ore mining industry.

But critics say the copper, nickel, platinum, palladium, gold and other valuable metals that PolyMet plans to mine and process are locked inside rock that is high in sulfide. When that rock is unearthed and exposed to air and water, it creates acidic runoff that can pull heavy metals and other contaminants out of the rock.

The state permit to mine will lay out all of the rules the company must follow, including how much money the company must front as financial assurance should problems occur. Most of the rules have been laid out by a 1990s package of state laws that cover nonferrous mining such as copper mining.

PolyMet still needs to raise an estimated $650 million to "build out" the mine and refurbish the processing center to begin production.

PolyMet also will have to buy some sort of bond or insurance policy to cover the estimated $200 million needed to cover any mishaps at the mine — and also to rehabilitate the site after mining ends — plus another $3 million to $6 million annually to cover water treatment at the site that may have to continue decades after the mine is played out.

The PCA and DNR permit updates can be found at mn.gov/polymet.

Loan repaid, land exchange decision near

Also Monday PolyMet announced that it has repaid in full a $4 million loan from the Iron Range Resources and Rehabilitation Board. Including interest, the company repaid $5.1 million.

The money was used to buy various tracts of private land within the boundaries of the Superior National Forest. That land will now be traded to the U.S. Forest Service for land at the proposed PolyMet mine site — but only if the Forest Service gives final approval to the land swap.

A decision on the land exchange is expected from the Forest Service sometime in the next few weeks.

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