Mining company fails cyanide ban challenge

HELENA – Montana’s 7-year-old ban on using cyanide in gold mining did not violate the constitutional property rights of a company hoping to develop an open-pit mine near Lincoln, a unanimous Montana Supreme Court ruled Wednesday.

The fact that Canyon Resources Corp.’s Seven-Up Pete Joint Venture just had the chance to develop state mineral leases for its mine did not give it a property right that could be taken away by passage of the ban, the justices said.

“We conclude, therefore, that the Venture’s opportunity to seek a (state) permit, which required convincing the state that this cyanide leaching project was appropriate, did not constitute a property right,” the court held. “The state had wide discretion to reject the Venture’s permit application, even without enactment of I-137.”

The ruling, which upheld a district judge’s findings, did not resolve all the legal battles over voters’ passage of Initiative 137 in the 1998 general election. Several federal court cases raising the same issue settled by the state’s high court are pending.

But the Supreme Court’s decision does lay to rest claims under the Montana Constitution, which prohibits the taking of personal property without compensation. Canyon Resources had argued that is what the cyanide ban did in halting plans for its gold mine.

A spokesman for the leading environmental group behind I-137 applauded the court’s decision.

“It is quite clear that Montanans have a right to make laws to protect their water and air, and that doing so does not result in a loss of private property rights, especially when there is no private property right to begin with,” said Jim Jensen, executive director of the Montana Environmental Information Center.

Jim Hesketh, president and chief executive officer of Canyon Resources, said he had not seen the ruling and could not comment on specifics. But he did say the outcome was not surprising.

“It’s been pretty tough to get a fair shake up there on any of this,” he said.