Mine Industry Overcomes Its Poor Image Despite Bad Publicity, Development Continues

For certain, the mining industry has been pummeled in recent years by environmentalist bent on stopping all mining.

Mining executives who gathered in Spokane this month acknowledged once again the ill will the public continues to hold about the industry, worsened by well-funded and well-delivered rhetoric from anti-mining forces.

Research unveiled at the Northwest Mining Association Convention showed that aside from tobacco companies and firearms makers, mining receives more negative media coverage than any other industry.

But despite the negative press, miners have been able to get metals from domestic soil.

Unlike fierce opposition to tobacco, which has made mild dents in demand for cigarettes and raised the spectre of government regulation of the product, opposition to mining hasn’t done much to halt new development.

This year alone, at least nine new mines opened, several expanded or re-opened and several got the corporate go-ahead for opening later, said Douglas Silver of Balfour Holdings Inc. of Denver.

“That’s pretty good,” he told the convention concluded last Friday, “for an industry that was considered dead and buried.”

Even Sunshine Mining and Refining Co. of Boise, with about $240 million in losses this decade, managed to raised millions to pay for its expansion of the Sunshine Silver Mine in Idaho’s Silver Valley.

The exception to that business-as-usual rule occurred this summer when backers of the New World mine accepted a government swap worth $65 million in exchange for abandoning their project near Yellowstone National Park.

Until mining companies cannot obtain permits for new mines, and until they cannot raise money to build them, mountains of bad press won’t prevent mining from continuing here.

In fact, mine opponents such as Larry Tuttle, director of the Center for Environmental Equity, believes that once proposed mines start receiving permits, they inevitably will be built.

“You can’t stop a mine,” Tuttle said during a tour of journalists to a controversial mine in Western Montana last summer. “You can only hope to improve it.” Tuttle walked from Western Oregon to Denver in August 1995 to protest the lack of reform in the 1872 Mining Law. The law allows companies to “patent” public land, technically turning it to private land, for scant fees, and requires regulatory agencies to process mine permits.

Efforts to change the law have failed several times this decade, and legislative analysts doubt reform will emerge from the upcoming Congress.

Handcuffed by the antiquated law, government agencies have no choice but to move mine permits along, Tuttle believes.

While a mine cannot be railroaded in every case, the lengthy permitting process has no mechanism to stop a mine, said George Brown, a geologist at the Spokane office of the Federal Bureau of Land Management.

If the mining claim meets general criteria, the permit process is designed to allow the company to extract the minerals in the safest way possible. It is not, however, designed to toss mine projects aside for perceived public interest.

If the land being mined has an endangered species on it or some other conflict with existing federal law, the company must come up with a plan to comply, Brown said. If it does, it gets to mine.

Mining companies say acquiring the permits for a new mine requires at least five years and millions of dollars to smooth compliance through dozens of public agencies.

That length of time, Brown said, can scuttle a mine because companies that raised money sometimes can’t wait that long to get a return on the investment.

A darker spectre on the mining horizon continues to be the mine patent moratorium, enacted legislatively in October 1994.

Patenting is a crucial step in the evolution of a deposit of minerals to refined metals. Mining companies don’t have to have one to get metals from public lands, but it strengthens their legal grip on the land and can make expanding the mine far easier.

Mining foes single out the patent process as a large public ripoff, publicizing “billion-dollar giveaways.” That sentiment helped lead to the October 1994 moratorium, which freezes government agencies ability to grant mineral patents.

The moratorium is likely to continue for at least another year, said Bob Webster of the National Mining Association in Washington, D.C.

“Moratoriums have a funny way of becoming permanent,” Webster said. “It won’t likely be changed until we get mining law reform through.”

Getting a patent can take six or seven years, Webster said, meaning that fewer domestic mines will open in the future if patents can’t be processed.

Brown at the Spokane BLM office said there were projects in his district, which covers Washington state, being held up by the moratorium. “But I can’t tell you what they are off the top of my head because the moratorium prevents us from processing them.”

As of last January, the Department of the Interior had 603 patent requests pending, Webster said. Of those, 386 had been “grandfathered” out of the moratorium, meaning the applications had progressed far enough so that the Department of the Interior will have to process the patents in the next five years.

The moratorium and the rising anti-mining sentiment has sent mining companies to friendlier shores. Indonesia, South America and the former Soviet Republics remain hot prospects for development, siphoning more exploration dollars away from the United States and Canada.

“People are still looking here and developing mines,” Webster said, “but the highest grade deposits are being tapped offshore.”

One mining executive predicted that rush to explore overseas may fade once companies discover how difficult it is to actually put a mine into production there.

“See if any of the companies in Indonesia actually develop a mine there,” Richard Duncan, an executive with Placer Dome Inc., one of the largest mining companies.

While it may seem easier to develop mines away from the rigorous United States permitting rules, the challenges of dealing with a new culture and political instability may eventually bring mining companies back to North America and its timeconsuming but stable rules.

“The companies that are able to work with new cultures abroad will be the ones that really succeed,” Duncan said.

Back home, the purchase of Santa Fe Pacific Gold Inc. by Homestake Mining Inc. shows that companies are still very interested in working here, Webster said.

“Instead of trying to develop mines themselves, companies are just buying up other companies with established reserves,” he said. “It’s a lot easier to do that than look for deposits themselves.”

, DataTimes