As the summer of 2018 began, several media outlets began reporting on the news that Canadian mining company Glacier Lake Resources, Inc. was set to begin exploratory mining in Utah for several different metals on Colt Mesa, land that was once part of Grand Staircase-Escalante National Monument.This developing story is another piece of evidence suggesting that in the early years of the Donald Trump presidency, the priority pendulum of the federal government concerning public lands has seemingly begun to swing away from preservation and conservationtowards land use, specifically extraction of natural resources. Unsurprisingly, several organizations have spoken out publicly about the plan to mine (Greenberg2018; Sybert, Croft and Polly 2018; Cramer 2018) in what was until recently officially considered by the federal government to be an ecologically, geologically, paleontolicially, archaeologicallyand culturally important area (U.S. President 1996). As there are always two sides to every issue, the debate over what should be done with federal public lands is no different. Both sides (the federal government and the mining industry and miners on one and “environmentalists” of every stripe on the other) believe that precedent and law support their cases. These opening salvos regarding land use in what was formally federally protected land is only the latest entry in the long and complicated history that the government of the United States has had with mining, especially in the west. Historically, policy and political issues regarding mining can be grouped into two broad categories: 1) under what terms public land be used for mining and 2) identification of threats to the environment caused by mining and subsequent development of legislation that mitigates those threats. In addition to these two historic issues, global climate change presents some unique challenges to the mining industry. In order to better understand what the future holds for mining on Colt Mesa and other sites, it is important to review these three factors.
Whose Land Is it Anyway?
Industrial mining has been part of land use in the west as long as there have been Europeans and Americans on the continent. Starting in the late 1500s, the Spanish were extracting metals from mines in Mexico (Studnicki-Gizbert 2017). Americans were not far behind as thousands made their way west in the name of Manifest Destiny chasing rumors of gold and silver strikes in the mountains and deserts of the west. As the number of mining claims being staked in the west increased, the federal government felt it necessary to codify the claims process on federally owned land. This effort culminated in the Mining Law of 1872, signed into law by President Ulysses Grant. While there are other federal, state, and local laws and statutes that apply to mining claims, the Mining Law of 1872 is arguably the most contentious because, with the exception of a minor revision in 1993, the terms of the law have remained virtually unchanged since 1872.
While the full text of the Mining Law of 1872 can be easily accessed, it is still worthwhile to review the important points of the law. With that in mind, a bit of an historical perspective is useful when reviewing the terms of the law. Post-bellum America was an industrial powerhouse on the verge of entering the Gilded Age. The first Transcontinental Railroad had been completed in 1869 and because of that and other technological innovations, Americans were able to head West (and were encouraged to do so with the Homestead Acts and other enticements) with relative ease. Corporate interests were also heading west in search of raw materials for industry. Many of the federal agencies in charge of managing public lands (such as the United States Geological Survey, National Park Service, and National Forest Service) were borne out of this era. While the west might have still been metaphorically “wild,” the literal wildness of the west was becoming more tame by the year. Wallace Stenger (1992) describes the situation nicely inBeyond the Hundredth Meridian,
Postwar Washington permitted and encouraged the development of professionals and put them in charge of operations of incalculable potential. Less than twenty years after the war, Washington was one of the great scientific centers of the world. It was so for a multitude of causes, but partly because America had the virgin West for Science to open, and Washington forged keys to open it with.
In short, federal governmentwas becoming serious about cataloging and organizing the west, and the Mining Law of 1872 was one of the blunt instruments used to accomplish the task of regulating land use.
As currently constructed, the Mining Law of 1872 applies only to hard rock minerals mining (the original law specifically mentions quartz, gold, silver, cinnabar, lead, tin, copper, or “other valuable deposits”(U.S. Congress 1872), however it originally also covered coal claims. Coal, oil, natural gas and “common variety minerals” like sand and gravel were removed from the Mining Law by the Mineral Leasing Act of 1920 and the Materials Act of 1947, respectively (Morriss, Meiners, and Dorchak 2004). While there are coal mines in the western states (U.S. Energy Information Administration 2016), the majority of mining activity involves hard rock mining (Major Metals Operations in the United States 2018), therefore the relationship between hard rock mining and the Mining Law of 1872 will be the focus of the majority of the discussion in this chapter.
The leading section of the Law gives a sense of its broad scope, All valuable mineral deposits in lands belonging to the United States, both surveyed and unsurveyed, are hereby declared to be free and open to exploration and purchase, and the lands in which they are found to occupation and purchase, by citizens of the United States and those who have declared their intention to become such, under regulations prescribed by law, and according to the local customs or rules of miners in the several mining-districts, so far as the same are applicable and not inconsistent with the laws of the United States (U.S. Congress 1872).
While there may be several points of contention in that initial section of the law (such as the definition of “valuable”), things become much more interesting (or at least eyebrow-raising) when the economics of the law are first considered. While filing the paperwork to work a claim costs nothing but time, obtaining title to the claim incurs a fee to be paid to the federal government. As the law was originally written, “not less than one hundred dollars’ worth of labor shall be performed or improvements made during each year,” on any claim that has been staked on federally owned land since May 10, 1872 (U.S. Congress 1872). The labor requirement was then changed to an annual holding fee of $100 in 1993 (U.S. Congress 1872). Additionally, obtaining title (or what is more technically referred to as “patent”) will cost the applicant $2.50 per acre for placer claims and $5.00 per acre for lode claims (U.S. Congress 1872). While the law includes restrictions on total acreage of claims, the claims are subject to 1872 prices, which at first glance seems to be a clear example of fleecing the federal government. Or is it?
Still the Law of the Land
While the provisions of the Mining Law of 1872 invite plenty of criticism, it is important to consider the scope of the land to which the Law applies. In the eleven western states, five federal agencies (Bureau of Land Management, Department of Defense, Forest Service, Fish and Wildlife, and National Park Service) administer approximately 350 million acres of public land (U.S. Library of Congress n.d.). Even if one were to subtract the lands that are protected from development (DOD, FWS, and NPS), there are still approximately 314 million acres of public land up for grabs, so to speak (U.S. Library of Congress n.d.). Not all of this land is governed by the Mining Law of 1872, however. The law only applies to land that has always been federally owned. There are other laws that apply to acquired federal land (by gift, purchase, or condemnation), Indian lands, and most state-owned lands (Gerard 1997). With that said, on the eligible federal lands, there are approximately 400,000 active mining claims (The Diggings, 2019).
Critics of the Mining Law of 1872 argue that reform is needed in the form of more federal control. Proponents argue that the law is having (and has had) its desired effect, and no reform is needed (The National Mining Association (2016) lists ten federal laws and a dozen categories of state laws that currently apply to minerals mining).David Gerard (1997)of Lawrence University discusses three central issues regarding the reform debate. First is that the private sector can make land-use decisions relatively unsupervised, therefore there should be more “administrative control by government agencies.” Second is that there are no provisions within the Mining Law of 1872 that address environmental protection. Finally, there is the economic concern. Not only is the cost for staking and maintaining claims very low (as discussed above), but critics are quick to point out that the Mining Law of 1872 has no royalty provisions and the federal government is losing out on potentially billions of dollars in revenue (Gerard1997).
The Mining Law of 1872 has been referred to as, “one of the most reviled federal land laws,” (Morriss, Meiners, and Dorckak 2004)“one of the last remaining American dinosaurs of the old public resources giveaways,” (Earthworks n.d.) and “the undisputed surviving king of nineteenth century congressional underpinnings of the westward expansion.”(Leshy 1988)Yet is it still the law of the land. Why? A Cato Policy Analysis offered two very practical reasons in 1998, that arguably still hold true today: “First, the media and many mineral analysts poorly understand the distribution of wealth under the current system. Second in their moral quest to prevent giveaways and generate revenue for the federal government, reformers have proposed policies that will make the extraction of minerals less efficient and may even increase the burdens on taxpayers.”(Gordon and VanDoren 1998)A similar perspective is offered by Morriss, Meiners, and Dorchak(2004), “…[first] the Mining Law is the relic of a bygone era, persisting through a combination of inertia and special interest lobbying. In the second, the Mining Law is an institutional response to the incentive problems of public ownership of resources and an effective, evolved mechanism for solving the problem of determining how to use those resources.”
Failure to change oversight of mining via the Mining Law of 1872 could be attributed to political and economic geography. Since most federal land lies in western states, “states without mining interests form a majority coalition in favor of converting those resources into a form which potentially benefits their citizens at the expense of mining state citizens.” (Morriss, Meiners and Dorchak 2004)Expressed more simply, easterners want revenue and westerners want free access to land (Morriss, Meiners and Dorchak 2004). The bicameral structure of the federal legislature has to this point prevented eastern interests from prevailing in spite of their superior representative numbers in the House. Proponents of the law argue to keep it in place but to add more federal oversight. Earthworks (2017), a nonprofit organization that supports sustainable solutions in the mining industry have argued for federal authority to deny mining permits and greater citizen involvement in all levels of mining regulation (Earthworks, n.d.). Permit/lease systems have also been argued for because they are more in line with other federal land management practices (Gerard 1997). The problem with greater federal oversight may be obvious: more bureaucracy means more red tape which means more time and money for miners to expend. The problem of an expanded bureaucratic role is argued well by Gerard (1997), “Mineral development would be in the hands of an agency that has little interest in whether the land is developed. They [miners] argue that it would lead to de factoadministrative withdrawals of the land, as well as delays in issuing and renewing permits.”
The perceived problem of the Mining Law of 1872 that garners the most research (and is potentially one of the most contentious issues) however is the question of fair return. It is fairly easy to understand why. A miner or a mining company can stake a claim for $2.50 to $5.00 per acre, pay their $100 annual fee and owe no other money to the Federal treasury regardless of the actual value of the minerals extracted at the claim. Critics argue that the federal government is giving away billions of dollars of taxpayer money in what amounts to a massive subsidy for mining. However, closer examination of the law and the mining industry may prove otherwise. While it is difficult to empirically assess the efficacy of more or less regulation on mining claims, analyzing the economic implications of the law is easier. Three primary criticisms of the Law regard the lack of royalties, the low price of federal land, and “returns from speculation”(Gerard 1997; Morriss, Meiners and Dorchak 2004; Leshy 1988).
In the years since 1872, it has been suggested that a royalty be placed on production revenue from mining to compensate for the low cost of taking title for a claim. For example, in 1993, President Bill Clinton suggested a “12.5% royalty on the gross value of the hardrock minerals extracted from mining claims on public lands.” (Clinton, 1993)More recently, in the autumn of 2017, the Hardrock Mining and Reclamation Act was introduced in the Senate. Part of that bill includes the imposition of a more modest two to five percent royalty on the gross income of new production(Senators Introduce Bill to Reform Antiquated Hardrock Mining Laws 2017). That bill has not left the introduction phase (U.S. Congress 2017) and it can be argued that it is mostly because of the groundwork laid by retired senator Harry Reid. As the son of a miner, Senator Reid was particularly attentive the calls for reform of the Mining Law of 1872 and spent years organizing mining interests to bring their case against reform to the Senate (Simon 2018).
So what is it about the royalty, a seemingly logical measure for the Federal government to take, that has not allowed any reform to occur? There are several factors. Gerard (1997) argues that it would create a “high-grading” effect that would incentivize mining companies to mine only high grade ores. Additionally, “hardrock mining is characterized by uncertainty, long time horizons, and only rare success” (Gerard1997) and is dependent on a significant investment of capital on infrastructure and machinery. Being subject to a royalty whose rate could change on a political whim may be deal breaker for a miner who would otherwise be willing to take a financial chance on exploration. The reasonable rate for a claim and the absence of a royalty “offers a means for the government to credibly reduce the possibility of later expropriation” (Morriss, Meiners and Dorchak 2004). Morriss, Meiners and Dorchak (2004)also makes the case that “governments have a problem making credible commitments for the future through contracts”). The economic benefit of a royalty does not play out either. According to Gordon and VanDoren(1998), “If the 1872 law has created any ‘giveaways,’ they range from $2.5 million to $16 billion (with the true number probably closer to the lower figure)…,” and, “Each recipient of that ‘giveaway’ pocketed at most $8,000 that was rightfully the taxpayers’. Although subsidies are objectionable, that amount pales in comparison with the exaggerated figures [$231 billion is a number that is frequently cited by opponents of the law] that have been widely cited in news reports and in the halls of Congress.” An imposition of a royalty, unless it was at an extraordinarily high percentage, would be largely symbolic.
Another interesting byproduct of the low cost and limited bureaucracy in the Mining Law of 1872 is that it may limit government corruption. While many different systems of government regulations on mining exist in other countries, it may be useful to examine some foreign cases as examples of what could occur with expanded government involvement in the United States. In a 2017 report, Transparency International concluded “that vulnerabilities to corruption exist in mining approvals regimes across the world, irrespective of their stage of economic development, political context, geographic region, or the size and maturity of their mining sectors” (Caripis2017). In countries where the government owns key infrastructure needed for mining, is responsible for analyzing social and environmental impact, is involved with development, health and safety standards, and invests and distributes revenue from mining, opportunities for corruption are many (Ernst & Young Global Limited n.d.). Government officials are involved at several different layers of the mining process and can block or delay projects while soliciting bribes to allow the mining to proceed (Ernst & Young Global Limited n.d.). In 2017, the Organized Crime and Corruption Reporting Project reported on a mining corruption scandal in the Democratic Republic of the Congo that resulted in payments of between $750 million and $1.3 billion to various entities tied to the president of the DRC (Mackie 2017). In a 2018 study of state-owned enterprises involving natural resource extraction, the Brookings Institute remarked in countries where “state-owned enterprises play an oversized role in the fiscal health of the state,” that this could lead to “damaging shocks across the economy and political system.” (Gillies, Heller, and Kauffmann 2018). They point to bribery in Algeria, Brazil, Colombia, Iraq, and Venezuela; awarding contracts to politically favored companies in Russia, Nigeria, and the Democratic Republic of Congo; and movement of funds to illicit organizations in South Sudan (Gillies, Heller, and Kauffmann 2018). That is not to say that state-owned enterprises can not work well: Ectopetrol in Colombia and Statoil in Norway are two successful examples (Gillies, Heller, and Kauffmann 2018).
Limiting corruption may be where the Mining Act of 1872 is most successful. Although there is a very low price paid to the government on the front end of a mining project, “the government does not forego all revenue from the mineral resources, only the revenue from their sale. Revenue from the exploitation of the resource may be taxed via income taxes on the mineral rights owners’ profits or on their employees.” (Morriss, Meiners, and Dorchak 2004) Additionally, it can be argued that governments with state-owned enterprises spend significant money on corruption avoidance. However, if the layers of bureaucracy are removed with limited government involvement, “foregoing revenue from mining claim sales means a loss of one source of revenue, but it also entails a compensating savings and increased tax revenues from other sources.” (Morriss, Meiners, and Dorchak 2004) While there is certainly room for improvement of the economic factors in the Mining Law of 1872, it would appear that for the most part it has had its intended effect of promoting exploration and limiting government corruption.
Environmental Protection Under the Law
As the American west began to open up to hard-rock and other types of mining, it was soon realized that in the quest to extract as much valuable material from the ground as possible as quickly and profitably as possible, that mining was taking a toll on the environment as well as on the people working the mines and communities surrounding the mines. While this realization did not immediately result in legislation that addressed the problems, at least it provides evidence that the nascent American mining industry was aware that pulling natural resources from the earth was not going to be a simple process. Several pieces of environmental protection legislation, at all levels of government and across multiple agencies have been enacted, especially in approximately the last forty years, that apply to mining. However, at the time of the writing of this chapter, environmental protection legislation, especially at the federal level, is fluid. The New York Timeskeeps a running list of “Environmental Rules on the Way Out Under Trump” that as of August, 2018issitting at 76 (Popovich, Albeck-Ripka, and Pierre-Louis, 2018). Forty-six of those rules have been overturned and thirty are on their way out. One of the most recent rollbacks is addressed in a July, 2018 memorandum from the Bureau of Land Management that drops the mandatory “compensatory mitigation” standard from public land use and makes it voluntary(U.S. Bureau of Land Management 2018). Several of these rollbacks have been challenged in courts and more lawsuits are sure to follow (Milan, 2018). While the future of environmental policy regarding mining is in flux, it is still worthwhile to discuss environmental policy as it has historically applied to mining.
A notable criticism of the 1872 Mining Law is that it contains no provisions for environmental protection. From Earthworks (n.d.), “…because the Mining Law contains no environmental provisions, hardrock mining wreaks havoc on the environment and taxpayers are all too often left to clean up the mess that companies leave behind.” From the Sierra Club, “For well over a century, companies have been able to mine a site until they didn’t think they could profit from in any longer, then declare bankruptcy and walk away, leaving taxpayers holding the bag for cleaning up toxic metals, polluted water supplies, and anything else they happened to leave behind.” (Grijalva 2018) From the Pew Charitable Trust, “[the Mining Law of 1872] Fails to protect water quality, wildlife habitat, and other natural resources. Nearly 40% of western headwaters have been contaminated by hardrock mining, and a 2004 government analysis found that nearly 60% of mine contamination cases studied will require water treatment for 40 years to “perpetuity.” (Pew Environment Group 2009)While all of these criticisms are valid, it can be argued that they are missing the point. Although there are no specific environmental protections in place in the Mining Law of 1872, as mentioned earlier, there are plenty of environmental protection laws across many levels of government that apply to mining. In addition to state and local laws, mining is regulated on the federal level by the National Environmental Policy Act, Clean Air Act, Resources Conservation and Recovery Act, Clean Water Act, Toxic Substances Control Act, and Comprehensive Environmental Response, Compensation, and Liability Act (American Geosciences Institute 2018). Additionally, “the Environmental Protection Agency, for the time being, also helps protect the communities surrounding mines and mining operations around the United States, assuring that all generations have access to clean water and air.” (Environmental Regulations on Mining in the United States2017) Proponents of adding environmental protection language to the Mining Law of 1872 may cite the approximately fifty abandoned mine sites on the EPA’s National Priorities List (Abandoned Mine Lands: Site Information 2018). However, many of these site were abandoned long before reclamation and environmental protection laws were enacted. If the current hierarchy of environmental protection laws and enforcement agencies remains the same for the foreseeable future as it is now, Gerard (1997) argues that changing the environmental laws is where reform is needed, not addition of of environmental stipulations to the Mining Law of 1872. In a time of environmental regulatory flux, it would be wise for both proponents and opponents of environmental protection measures in mining to pay careful attention to the goings on in Washington, D.C.
Effects of Global Climate Change on Mining
In the coming years and decades, global climate change is going to affect mining just as it will many other land use issues. Although climate change has become part of the global zeitgeist with most private citizens and industry, the mining industry has been late to the table on this issue. For example, between the publication of its first issue in 2014 and January 2018, the journal The Extractive Industries and Societyhas published zero articles with “climate change”inthe title (Odell, BebbingtonandFrey 2018). In 2014, Jason Phillips (2016) reported, “Within the literature, there has been no generic review or synthesis of the fundamental interactions between climate change and surface mining.” Additionally, possibly because of the federal government’s wavering stance on the validity of global climate change, specific literature on the effects of climate change on hard-rock mining in the United States is sparse or instead, addresses the impact mining (especially coal mining) has on global climate.
However, there are some themes presented in global literature on the subject that can be applied to hardrock mining in the western United States. The advocacy organization Climate Diplomacy lists four impacts climate change can potentially have globally on the industry (Ruttinger andSharma 2016). There is no reason to think that these factors will not impact mining in the western states. First, since the mining sector is one of the major emitters of greenhouse gases, the industry will have to find a way to deal with increased pressure to reduce emissions, even as the industry need for fossil fuels increases. Second, climate change may have a direct effect on operations or an indirect effect on supply chain and or rising energy costs. Third, climate change may exacerbate changes in ecosystems, agriculture, and raising livestock. While this factor may affect developing nations disproportionately because they are not well equipped to respond to large scale changes, it can certainly affect the United States. As mining already affects ecosystems, agriculture, and raising livestock (usually indirectly with factors such as toxic runoff of mining products or wind blown heavy metal particulates), the industry will have to be aware of its effects on an unnaturally stressed environment. Finally, since a “large and increasing number of extractive resources come from developing nations which already lack resources for climate adaptation,” developed nations like the United States will have to become more involved in ensuring supply chains are protected from the impacts of climate change. While this final factor does not directly affect mining in the west, threats to foreign supply chains may cause the mining industry in the United States to increase extraction and production rates which could then in turn put more stress on an environment that is experiencing the effects of climate change. Although he also comments on the lack of available literature, Phillips (2016) conducted as comprehensive of a review as possible of available data on the impacts of climate change on the global surface mining industry and identified several factors that can potentially be affected by global climate change. The results are summarized in Table 2 (Torres,Liu, Brandt, and Lear 2017).
*Global sand supplies may already be at risk (Torres, Liu, Brandt, and Lear2017).
In addition to the environmental impacts listed in Table 2, Phillips (2016) also discusses some issues that climate change may have on the mining industry ranging from extraction practices to impacts on employees.Although Phillips (2016) and others speculate on the impacts climate change will have on the mining industry, the lack of available data and research limits the scope of the conclusions.
While the general concerns about mining in the era of climate change mentioned above can certainly apply to mining in the United States, one specific climate change related issue that is a concern for mining in the western United States, and even more specifically, the southwestern United States is the issue of water usage. In hard rock mining, water is typically used for drilling, crushing, wet screening, semi-autogenous grinding, and ball/rod milling (Mavis 2003). Much effort is also put into controlling water flow at mine sites by using “diversion systems, containment ponds, groundwater pumping systems, subsurface drainage systems and subsurface barriers.” (National Mining Association 2016) The United States Geological Survey conducts a quinquennial survey of water use across all aspects of mining. The most recent survey shows three of the eleven western states falling into the highest category of water withdrawals (California, Nevada, and Utah in the 201 to 1,140 million gallons per day range) and two falling into the second highest category (New Mexico and Wyoming in the 101 to 200 million gallons per day range) (Mining Water Use 2019). Although total water withdrawals dropped significantly between the 1990 and 1995 USGS surveys, they have been on a slow and steady rise in the years since (Mining Water Use 2019). Problematically as water usage has increased, precipitation trends have almost without exception either decreased or remained unchanged in the western states (especially in southwestern states) in both the intervals between 1988-2017 and 1895-2016 (National Trends in Precipitation, 2019). Additionally, the average mean temperature in the western states south of the 42nd parallel have increased anywhere from one to four degrees Farenheit between 1988-2017 and all of the western states have seen an increase in average mean temperature in the 1895-2017 interval (National Trends in Average Mean Temperature 2019). If these trends continue, water use for the mining industry is on an unsustainable track. Although most mining operations reuse water when possible, it needs to be present to in order to be used (Mavis 2003).
Conflicts over public lands use have existed as long has there have been public lands. While many of the so called land grab laws of the nineteenth and twentieth centuries have been repealed or altered, the Mining Law of 1872 still governs hard rock mining claims on federal public lands. Some argue for repealing the law altogether and others argue that it is effective as is. However, there is certainly room for reevaluating the terms of the law that would better reflect economic and technological advances in mining that have occured over the course of approximately the last 150 years. The Mining Law of 1872 covers Washington, D.C.’s thoughts on mining, but there are also layers of state and local mining laws that at times are at odds with federal law. This can lead to confusion at best, and outright conflict at worst.Although past efforts to pass new federal mining laws that replace the Mining Law of 1872 have been blocked in Congress, the terms of the law are in serious need of a fact-based, data-driven debate of the efficacy of its terms.
The second part of this chapter discussed the impact of climate change on the mining industry. This is an area that is in desperate need of further research. Most of the available information regarding climate change and mining has to do with discussing how the industry affects climate change, not the other way around. Most of the available data come from studies in developing nations. There are very limited data available for the effects of climate change on mining in the United States as a whole, much less the Western United States. Climate change is occurring and it would serve the mining industry well to seriously study the potential impacts of climate change on their industry. Currently, it seems as if the industry as a whole is taking a wait and see approach. This is a bad strategy for an industry that is reliant upon long term (years to decades) development to turn a profit.
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