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PolyMet forum outlines permit process

AURORA — The Minnesota Department of Natural Resources Tuesday night laid out how it will move ahead with developing the permits needed by PolyMet Mining Co. for what would be the state's first-ever copper mining operation.

The DNR held an open-house-style meeting at Mesabi East High School to explain how the agency will scrutinize PolyMet's permit applications, expected by mid-summer, and at which point the public will have the chance to comment at open meetings and in writing.

More than 400 people attended, many wearing "We Support Mining'' stickers, half-filling the gymnasium. But some may have gone away disappointed. The DNR steered conversation away from comments for and against PolyMet and instead focused on the complex permitting process.

The permit to mine is the biggest and most complicated of nearly two dozen permits that PolyMet will need before it can begin the project. Other permits cover air pollution, water pollution, water useage, wetlands, dams, endangered species, hazardous waste and more, to be issued by both the DNR and the Minnesota Pollution Control Agency.

The state permit to mine will lay out all of the rules the company must follow, such as mining operations, transportation, waste rock storage and financial assurance — as well as how much money the company must front to cover any problems that occur. Most of the rules had been laid out by a 1990s package of state laws that covers nonferrous mining such as copper.

Both the company and the DNR described the permit-to-mine process as an intense look at how the mine will work — even more detailed than the 3,900-page environmental review that took a decade to complete.

"This is more of a prescriptive process ... but also a much more compressed process," said Jon Cherry, PolyMet CEO, adding that he anticipates no major surprise issues after the DNR deemed the environmental review completed in early March. "What we're doing now is probably even more detailed, to back that (decision) up."

DNR officials assured those attending that they'll have ample opportunity to see PolyMet's permit applications soon after the agency receives them.

"They're going to all be posted online for anyone to see," said Barb Naramore, DNR assistant commissioner.

There are also public comment periods and public meetings planned if and when the state and the company can agree on permit specifics. State law also allows challenges of permits through an administrative law judge or the state Court of Appeals.

It's not yet clear how long the permitting process may take or when that public input will be opened.

There is a state-mandated 150-day "goal" from the date of application for agencies to either deny or award permits. That's not likely in this case because of the complexity and controversy surrounding the project. But PolyMet clearly is hoping for permits in hand to start work by 2017.

PolyMet is proposing an open-pit copper mine not far from Babbitt, with processing at the former LTV Steel Mining Co. taconite plant near Hoyt Lakes. 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 too much tied to the cyclical and now troubled taconite iron ore industry.

"This permit process is another step toward seeing this happen." said Mike Skelton, mayor of Hoyt Lakes.

"People up here are walking around with their heads hung down right now with some of the mines still down. I'm trying to see the glass as half full, that we still have a future, and this PolyMet project is a big part of that," Skelton added. "I know they can do this right and not harm the environment or I wouldn't be saying this."

But critics say the copper and other metals that PolyMet plans to mine and process are locked inside rock that is high in sulfur. 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. Environmental groups claim that runoff, if uncontained and untreated, could taint the nearby and downstream waters of the St. Louis River or even Lake Superior.

DNR Commissioner Tom Landwehr in March ruled that his agency's decade-long environmental review of the proposal is 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.

Once permits are in hand, the company said it will take 18-24 months to refurbish the old LTV taconite processing plant and tailings basin and dig the new copper mine and start production — processing ore to pull out the valuable copper, nickel, gold, platinum and palladium inside.

PolyMet also needs some federal permits, including for wetlands that would be destroyed at the site and replaced elsewhere. And state officials noted Tuesday that the federal environmental review is still underway for both wetlands and a land exchange for property at the mine site.

The project could still see state or federal lawsuits get in the way. And PolyMet still must raise an estimated $650 million from investors or creditors to "build out" the mine and refurbish the processing center to begin production. The company also will have to provide some sort of bond, trust fund or insurance policy to cover the estimated $200 million needed to pay for 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.

DNR officials say the state will require, in the permit to mine, that PolyMet have enough money in that account so taxpayers won't have to pay a dime if something goes wrong, even if the company itself fails or dissolves.