PolyMet submits application for permit to mine
PolyMet Mining Co. on Thursday submitted its massive application for a state permit to mine, the first ever for a copper mine in Minnesota.
The more-than-15,000-page document, years in the works, lays out the company's detailed plans to blast open the mine pit, build a processing center near Hoyt Lakes, design and operate water treatment technology and then close the mine and rehabilitate the site when the copper, nickel, gold and other precious metals are played out.
The permit application, which the Minnesota Department of Natural Resources will now review, also includes PolyMet’s proposal for a financial assurance package — money guaranteed and set aside to fix any problems that might happen years into the future, even if the company leaves town or files for bankruptcy.
The DNR is expected to review the applications over several months, demand changes and negotiate over how much money should be set aside to pay for any unforeseen trouble.
“There’s a certain amount of back-and-forth between the agency and the permit applicant as we identify areas where we need some supplemental information,” said DNR Assistant Commissioner Barb Naramore.
If and when the DNR approves a draft permit to mine, the document will be subject to a 52-day public review period and possibly a formal “contested case hearing” in front of an administrative law judge.
“It’s going to take a number of months to get through this application and then it will go out to the public” for review and comment, likely sometime in 2017, Brad Moore, PolyMet executive vice president of environmental and governmental affairs, told the News Tribune.
Should the DNR approve, deny or set conditions on the application, that decision can be appealed, possibly stretching a process that has no statutory deadline from months to years.
“It’s fairly likely no matter what we decide it will be appealed,” Naramore said.
The permit to mine is considered the most important, and most controversial, of nearly two dozen state and federal permits PolyMet will need before it can start construction and operations. Other key permits are for wetlands replacement, air and water emissions, water usage and dam safety.
Those permits “are really the heart of what you need to mine in the state of Minnesota,” Moore noted.
The company has vowed to use reverse osmosis to treat all water leaving the mine, processing and waste tailings areas and insists that any water that leaves its property will meet all state and federal water pollution limits. The mining plan calls for more than $100 million to be set aside in a trust just for ongoing water treatment, Moore noted. The financial assurance bonds or account will likely grow to “multiple hundreds of millions of dollars” as the mining operation advances, with the DNR renegotiating the amount each year as the mine expands and the potential for problems increases.
Moore said he expects the DNR, and the public, to demand that financial assurance number be high.
“The numbers are key. It’s very important to the company, because it going to be a huge cost, and it’s very important to the public,” he said. “There has to be the right number in there (for financial assurance) for us to have the social license to mine that we need from the people of Minnesota.”
The state has hired private consultants with expertise in mining to determine how high that financial assurance number should go.
The permit application shows no change in the amount of ore PolyMet intends to dig or process annually, or the number of proposed employees — about 300 to start with the potential of another 60 jobs if a secondary processing site is added in the future.
The processing center would be located in the former LTV Steel Mining Co. taconite facility near Hoyt Lakes with the open-pit copper mine a few miles away, not far from Babbitt.
Supporters say the all-new kind of mining will pump $550 million into the regional economy each year, welcome diversification in an area hard-hit by the cyclical iron ore industry.
But critics say the potential for polluted runoff from the site is too great, and that the potential environmental harm isn’t worth the risk — especially the risk of acidic runoff when sulfur-bearing rock is exposed to air and water, a situation unique to copper mining.
“We’re going over that permit very carefully to see that those in downstream communities are protected in terms of environment and health,” said Paula Maccabee, attorney for mine opponent WaterLegacy. “What was in the final environmental review was certainly not enough to protect Minnesota's environment or Minnesota’s financial responsibility.”
Opponents are urging a contested case hearing on the permits, overseen by a state administrative law judge, in order to get more concerns voiced and draw out the debate. A decision on whether a contested case hearing is held will follow public comments, and stem from an affected property owner or government agency’s objection, a permit denial or a “material issue of fact” raised by the DNR.
“Are there some issues that appear to be of concern that the contested case hearing could be helpful in trying to resolve?” Naramore said. “The state puts forth rules and criteria ... whether the hearing would help us resolve issues.”
PolyMet’s environmental impact statement was approved earlier this year by the DNR after a nearly 10-year environmental review period that included a do-over after the initial review was deemed inadequate by federal regulators. PolyMet still is waiting for federal approval of its plan to replace wetlands lost at the mine site and for approval of a land exchange with the U.S. Forest Service needed to acquire the mine site.
Toronto-based PolyMet, which is one-third owned by Swiss commodities giant Glencore, is a so-called “Canadian junior” mining company, and the Hoyt Lakes mine is the only project it has. The company will need to raise more than a half-billion dollars from investors and lenders to actually build out the mine, with financing likely to come after permits are approved.
Construction is expected to take about two years.
Brooks Johnson of the News Tribune contributed to this report.