News in Brief
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National Mining Association v. EPA – In this suit against EPA “Guidance”, the District Court for DC has ruled to reject agency reliance on guidance in lieu of rulemaking. Judge Reggie Walton ruled that EPA exceeded its statutory authority and violated the Administrative Procedures Act by relying on interpretive guidance – rather than a regulation – to modify the permitting process for mining activity under the Clean Water Act. Congratulations NMA!
Corps General Permit Renewal – the Corps of Engineers has proposed re-issuance of General Permit 2006-1944 for placer mining in Alaska. They are proposing the exact same permit as is now in place with the intent that the next time the permit comes up for renewal will be on the same schedule as the State APDES permit. Permittees whose permit expires on or before May 11, 2012will receive an automatic extension until Oct 31, 2014; New applicants in 2012 and 2013 will receive the interim GP which will expire Oct 31, 2014; applicants with a lapsed permit who plan to work in 2012 and beyond must submit an updated APMA as application to the Corps for the GP; operations permitted under this reissuance will have the customary 12 month grace period after Oct 31, 2014 to complete their activity and make sure their permits are current under the new GP at that time.
Roadless Rule: State of Wy & CMA v. USDA/USFS – Wyoming Governor Mead has filed a Petition for Rehearing in this case which appeals a three judge panel ruling that confirmed the USFS decision that it did not have to follow District Judge Bremmer’s ruling. Judge Bremmer ruled that the Roadless Rule was not legal under the Wilderness Act and under the Administrative Procedures Act but the USFS decided to apply that decision only in the state where the case originated. Wy & CMA appealed and AMA and various other groups filed an amicus in the case.
ConocoPhillips CD5 – Corps/USFWS have reached an agreement that may allow construction of the bridge across the Colville River to access the CD5 area. The Corps in Feb 2010 denied the permit for the bridge.
Mingo Logan Coal Company vs. EPA – (Spruce No. 1 Permit Veto by EPA) - District Judge Amy Jackson in Washington has questioned whether the EPA has authority under the Clean Water Act to void a mining permit issued by the Corps of Engineers and deferred a decision on whether EPA's action “was reasonable and supported by the record". The lawsuit challenges EPA's revocation of the use of certain streams for placement of fill material under legally-issued Section 404 permits. A threshold issue is whether Sec. 404 of the CWA grants EPA the authority it claims to veto specifications of an approved permit or whether, as industry argues, such vetoes effectively invalidate the entire Corps-approved permit and are, therefore, an overly broad interpretation of EPA authority. NMA and others argue that once the Corps has approved a permit, EPA can only appeal to the Corps for alterations, not unilaterally invalidate it.
S.1113, Critical Minerals Policy Act – Senator Bingaman (D-NM) Chairman of Senate Energy Committee has developed a substitute for this bill sponsored by Senator Murkowski regarding critical minerals. The Bingaman substitute is a joke. It greatly reduces the provisions of the original bill and guts all the items that had any benefit, making the bill into simply a “study” bill.
John Sturgeon v. NPS – The State of Alaska announced 12/7/11 that it will join this case by John Sturgeon over access on the Yukon and its tributary the Nation River, both of which cross the Yukon-Charley National Preserve. The suit argues that the river is State property and that the NPS should change its regulations that supposedly gives NPS authority over activities on the river.
Beluga Whale Lawsuit – The DC District Court ruled against the State of Alaska on its challenge to listing the beluga whale in Cook Inlet as endangered under the Endangered Species Act. The State of Alaska sued the National Marine Fisheries Service (NMFS), the National Oceanic and Atmospheric Administration (NOAA), and the U.S. Department of Commerce challenging the listing of the distinct population of beluga whales in Cook Inlet. The State maintained that the listing process was flawed and did not adequately involve the State or consider the state conservation measures already in place to protect beluga whales in Cook Inlet. Also at issue was whether the NMFS improperly applied recovery standards in making an initial species listing decision. Interveners were: Alaska Center for the Environment, Center for Biological Diversity, Cook Inletkeeper, Defenders of Wildlife, Natural Resources Defense Council, North Gulf Oceanic Society, and Escopeta Oil Company.
H.R.3094, Workforce Democracy and Fairness Act (NLRB's "Ambush" Elections) – This passed the House and will restrain the National Labor Relations Board's (NLRB) authority to restrict employers' free speech and employees' free choice in union elections. Supported by NMA and scores of other industry and business groups, H.R.3094 would void the NLRB's recent attempt to speed up union elections and organize new worksites. So-called “ambush elections” on expedited schedules would deny employers time to inform employees of pertinent issues. The House action follows its earlier passage in September of a measure that would ban the NLRB from forcing companies to close or relocate jobs.
H.R.2354, Appropriations – Senators Barrasso (R-WY) and Heller (R-NV) have offered an amendment to the appropriations bill regarding the Corps of Engineers that would prohibit any funds to be used on “Advance Notice of Proposed Rulemaking on the Clean Water Act Regulatory Definition of ‘Waters of the United States’” and “Clean Water Act Jurisdiction Following the U.S. Supreme Court’s Decision in ‘Rapanos v. United States & Carabel v. United States.” We strongly support this amendment! If these rulemakings by Corps (driven by EPA) are not stopped or greatly changed the consequences for Alaska will be huge.
DOI Secretarial Order to Combine BLM and OSM – The House Natural Resources Committee passed an amendment by voice vote, to H.R. 3404 that rejects the Obama Administration’s recently announced intentions to merge the OSM and BLM. Specifically, the amendment keeps OSM and BLM separate, independent agencies in the DOI and under the purview of the Under Secretary for Energy, Lands and Minerals.
H.R.3446, Fair Payment for Energy and Mineral Production on Public Lands Act - has been introduced by House Resources Committee Ranking Member Ed Markey (D-MA). The bill attacks the General Mining Law and provides for AML funding. The Mining Law provisions are nearly identical to Rep. Rahall’s most recent Mining Law reform bill (H.R.699 from the last Congress). H.R.3446 would impose a 12.5% NSR on future production from public lands (Rahall was 8%); give the Secretary “mine veto” authority; eliminate patenting; impose new, duplicative environmental standards; and require the Secretary to grant withdrawal petitions from states, political subdivisions and Tribes in certain instances. The bill also effectively liminates security of tenure. The AML section would implement the president’s proposed reclamation fee of 7.8 cents/ton of material displaced, i.e. the dirt tax.
OSM Stream Protection Rule - Two of the original subcontractors who worked on the OSM draft EIS for the stream protection rule provided shocking testimony before the House Subcommittee on Energy and Mineral Resources. In written statements and during a question and answer period, Steven Gardner and Joseph Zaluski of ECSI, explained in detail how, following media reports in January of the potentially huge job impact numbers of the agency’s draft stream protection rule, OSM “suggested” that the contractors change the assumptions used to develop the economic analysis for the purpose of lowering the jobs impacts. They also testfied that “the team unanimously refused to use a “fabricated” They also testified that “the team unanimously refused to use a “fabricated” baseline scenario to soften the production loss numbers.” The experts contracted to analyze the impact of the rule initially found that it would cost 7,000 coal jobs they were subsequently pressured to not only keep the findings under wraps but "revisit" the study in order to show less of an impact on jobs. After the project team refused to "soften" the numbers, the firms working on the study were told the contract would not be renewed.
Metals Economic Group's (MEG) Corporate Exploration Strategies study - reveals a 50% increase in budgets for metals exploration expenditures in 2011, a new all-time high at $18.2B for nonferrous exploration. Latin America is expected to continue to be the leading exploration region, with Canada as the leading country; worldwide gold received the most and copper second. Study is based on information from nearly 3,500 mining and exploration companies.
Renewables No Longer Cheaper than Coal - Google has abandoned an ambitious project to make renewable energy cheaper than coal. Google said that it was pulling the plug on seven projects, including Renewable Energy Cheaper than Coal. Reuters, 11/22/11.
Coal in 2010 - EIA's preliminary release of the Annual Coal Report 2010 shows that the U.S. is home to 260 billion short tons of recoverable coal reserves, about 248 years supply at the 2010 coal consumption rate of 1.05 billion tons. The report lists the current demonstrated reserve base at 484.5 billion tons. U.S. coal production totaled ~1.08B tons; 59% of production was from the West and 41% from the East. The number of mines decreased 8.7% from 1,407 in 2009 to 1,285 in 2010. The average sales price per ton was $35.61, up 7% from 2009.
State FY-2013 Budget - Governor Parnell announced that his FY-2013 budget will contain $28.5m for roads to resources funding for increased access including: access to the Ambler Mining District ($4m), Umiat-Foothills West ($10m), a western access route through Tanana ($10m), the Klondike Industrial Use Highway ($4.5m), and other resource roads. The funding will be used for project definition, permitting, environmental work, and right-of-way acquisition.
Mat-Su Gravel Ordinance – On 12/6/11 Mat-Su Borough assembly adopted an ordinance regulating gravel mining, reclamation and mining in the water table. The major victory here is that the borough will now allow new applications for mining within or below four feet of the water table. It is great to have this issue resolved after about five years of uncertainty. The ordinance includes: exempts existing state-owned gravel sites from permitting (unless they go into the water table); exempts existing gravel sites from noise mitigation measures if a land use requiring a lower noise level moves in next to the gravel site; extends the 60% re-vegetation ground cover requirement from two to four years; allows removal of stock-piled materials from a site to qualify as site activity for the purpose of extending the site's non-conforming use status. Our thanks to Tom Healy and the Alaska Rock Products Association.
MSHA – MSHA Director Joe Main said he is adopting a new conferencing system that was piloted with mine operators earlier this year in an attempt to reduce the backlog of contested violations. The new system will help reduce the backlog by resolving disputes before they end up in litigation. The number of contested penalties rose dramatically between 2007 and 2010, creating a backlog of more than 89,000 cases. Congress funded a yearlong push to get it whittled down, and as of Sept. 30, Main said the total backlog was down to 69,000. Coal Tattoo, 12/2/11.
Climate Killers – is the name European ENGOS have given to Barclays, Royal Bank of Scotland, HSBC, JP Morgan Chase, Citigroup and Bank of America for lending money to the coal sector. JP Morgan Chase, Citigroup and Bank of America topped the list loaning at least €42bn to the coal sector since 2005. The research was compiled by a group of NGOs, including German environmental group Urgewald, the international network BankTrack and Earthlife Africa Johannesburg.
Coal Gasification – The Indiana Utility Regulatory Commission approved a 30-year contract to buy synthetic natural gas from a southern Indiana coal gasification plant. The plant will be built and operated by Indiana Gasification LLC with a goal to have the plant operating by 2015. The Indiana Finance Authority will spend an estimated $6.9 billion over three decades to buy the synthetic gas and then sell it on the open market. The project still needs environmental permits and zoning approval. AP, 11/22/11.
Geophysical Surveys? – Steve Borell noted that the Pentagon Task Force for Business and Stability Operations (TFBSO), in partnership with the USGS, will provide training and equipment specific to airborne geophysical exploration to the Afghan Geological Survey. This initiative is part of the U.S. Government’s continuing efforts to help the Islamic Republic of Afghanistan identify and develop its vast deposits of mineral resources in a transparent and responsible fashion. DOD, 11/29/11. Why not make the same investments in the US?
Alaska Ocean Observing System – has released a new version of the AOOS real-time sensor map. Go to http://data.aoos.org/maps/sensors. From this site you can check temperatures, humidity, winds, snow on the ground, etc. for about 300 reporting sites across the state.
Unemployment Rate Drops to 8.6%...The rest of the story - mostly due to a smaller labor pool with the number of working age people in the labor market down 64.2 to 64%; 50,000 of the 140,000 jobs added to the private sector in Nov were in retail, likely for the holiday season (biggest drop in those with little or no college education, while construction lost another 12,000 jobs and manufacturing added just 2,000); young people, especially young males, continued to struggle to find work the rate for those 20-24 rose to 14.2%.
Australia – Per the Australian Bureau of Resources and Energy Economics, total investment in the mining sector hit a record $232 billion in the past six months. Most is in the oil and gas, iron ore and coal industries. There are now a record 102 minerals and energy projects that have reached a final investment decision. There are also more than 300 other projects still in the pipeline with an expected cost of more than $224 billion. Bullion Street, 11/29/11.
USGS Scientific Investigations Report 2011-5162: Lithogeochemistry of Mineralized and Altered Rock Samples from the Northern Talkeetna Mountains – By Light, T.D., and Schmidt, J.M., 2011 is available at http://pubs.usgs.gov/sir/2011/5162/
Sierra Club – Carl Pope, 66, chairman of the Sierra Club has stepped down after 18 years amid discontent that the group has strayed from the woods and into corporate boardrooms [business and unions] and has compromised its core principals. He has been replaced by Michael Brune, 40, a veteran of smaller, tightly focused activist groups, who has pledged to focus on grass-roots organizing, recruiting new members and issues such as coal-fired power plants. Pope already takes credit for SC blocking 150 proposed coal-fired plants.
Full Metal Zinc Ltd. - announced that Steve Hayes is the new President and Chief Executive Officer effective November 1, 2011.
Anglo American – announced an agreement for it to acquire an incremental interest in De Beers, increasing Anglo American’s current 45% shareholding in the world’s leading diamond company to up to 85%. Nicky Oppenheimer, representing the Oppenheimer family interests, said: “This has been a momentous and difficult decision as my family has been in the diamond industry for more than 100 years and part of De Beers for over 80 years. After careful and deliberate consideration of the offer, and what is in the best interests of the family, we unanimously agreed to accept Anglo American’s offer. Anglo American is the natural home for our stake as they have been major shareholders in De Beers since 1926 and have a deep knowledge of the diamond business.
NovaGold – has announced that Greg Lang will be the President and CEO of NovaGold, effective January 2012. Mr. Lang has been President of Barrick Gold of North America, responsible for nine operations in the US, Canada and the Dominican Republic, including Donlin and has more than 30 years of mine operations, project development and evaluations with Barrick, Homestake Mining and International Corona Corporation. NovaGold also announced that NovaGold founder Rich Van Nieuwenhuyse will step down as President and CEO and will become the President and CEO of the newly formed NovaCopper Inc., a newly formed subsidiary that will now focus on the Ambler project’s 180,000-hectare property which includes the recently announced agreement with NANA. Congratulations Greg! And Rick!
Usibelli – Robert Brown has been named VP South Central Operations for Usibelli Coal Mine, Inc., located in Palmer and responsible for Wishbone Hill project. Rob has been the project manager for several years. Congratulations Rob!
Sun - Andover Ventures Inc. announced they staked another 118 state mining claims in the Ambler District adjacent to the 112 claims they already had bringing the total to 230 claims covering 36,800 acres.
Lik – Zazu Metals Corporation reports that two of the eight holes they drilled for geotechnical purposes encountered mineralization including 40m of 8.5% combined Zn + Pb.
Donlin - NovaGold announced the second Feasibility Study update. The update by AMEC found 1.5 Moz Au/yr in its first five years of operation at an average cash cost of $409/oz and an average of 1.1 Moz Au/yr at average cash cost of $585/oz over its projected 27-year mine life. The capital cost estimated at $6.7 billion includes the natural gas pipeline and nearly $1.0 billion in contingencies. This is approximately $300 m lower than the NovaGold press release of September 17, 2011. Thomas Kaplan, the newly appointed Chairman of the Board, stated, "Donlin Gold is a uniquely attractive asset. In size, it ranks among the top 1% of gold deposits in the world and its grade, long mine-life and exploration potential are exceptional.” Proven and Probable Reserves are 33.8 Moz Au, a 16% increase compared to the April 2009 feasibility study; a 27-year mine life based on a throughput of 53,500 tonne/day.
AMA Annual Convention Update – The Annual Convention was a great success with more than more than 695 registered not including about at least 225 vendor representatives. This is the largest on record for an AMA Annual Convention. Other statistics: Short Course #1 Exploring IOCG at 52; SC #2 From Prospect to Pre-Feasibility at 62; SC #3 Mining 101 at 72 over two days. Thanks to all who attended and especially to the Convention Committee for the hard work that made it happen.
NWMA Conference – in Reno was the largest ever with more than 150 attending the Alaska session. Steve Borell was elected to the Board of Trustees of NWMA.