ST. PAUL - A southwest Minnesota legislator claims the company proposing a northeastern copper-nickel mine is a shell corporation that does not have enough financial assets to assure that environmental problems it leaves could be cleaned up.
Rep. Andrew Falk, D-Murdock, also questioned Tuesday whether PolyMet intends to follow up with financial promises.
Falk received few answers as he hammered away at Vice President Brad Moore of PolyMet Mining Corp. with financial questions at the end of a five-and-a-half-hour state House committee hearing. Moore said he would have to get others to answer the questions, which did not set well with Falk or the committee chairwoman.
Falk was critical of Moore for representing PolyMet on Tuesday without having basic financial information about the company.
“I look forward to getting your list of questions so we can have the appropriate people answer them,” Moore said.
Also at the hearing, Minnesota officials said other states' experience may help as they decide how to ensure that PolyMet put up enough money to fix any environmental harm.
Opponents of the PolyMet proposal Minnesota told the committee that mines elsewhere have a poor history of leaving the environment clean.
“The cost of making a mistake is high…” said Executive Director Scott Strand of the Minnesota Center for Environmental Policy. “There is no such thing as a risk-free mine.”
The testimony came during a House Environment, Natural Resources and Agriculture Finance Committee. No action was taken and Chairwoman Rep. Jean Wagenius, D-Minneapolis, said she has not seen a bill on the topic, even though many in the Capitol expect legislation to surface requiring PolyMet to provide more financial assurances than current law provides that the environment will not be harmed.
Jess Richards of the state Department of Natural Resources said his staff is looking at several mines in the western United States to see how they have handled financial commitments mine owners made there to take care of environmental concerns once the mines close.
He promised to look into other mines and “what has worked and what hasn't worked.”
Laura Skaer of the American Exploration and Mining Association said Minnesota cannot compare PolyMet with mines in other states. "Each site has to be analyzed on its own."
Richards said the DNR will hire additional financial experts to help the state determine if PolyMet’s plan to repair any damage is sufficient.
However, Richards said, it is too early in the process to go through a so-called “financial assurance” plan. Environmental studies now are going on, he said, and PolyMet has yet to even file an application for a permit to mine.
It never is too early to learn about finances, mine opponents said.
Moore told the committee that mine opponents’ fears that the company would leave environmental damage on the Iron Range are unfounded.
The company cannot decide how to financially prepare for environmental cleanup, he said.
Although PolyMet will suggest a financial plan, Moore said state regulators are in charge. “Those regulators then independently make the decisions ... on whether what we propose is good adequate or not.”
Water quality specialist Margaret Watkins of the Grand Portage Band of Lake Superior Chippewa said plenty of study is needed because other mines affect the environment far less than would PolyMet, which she said would disturb 1,700 acres of land. Much more waste rock would be left once the mine closes compared to other mines, she added.
Also, she said, Minnesota mines cannot be compared with those in the western United States because Minnesota is far wetter, which presents more problems for the environment.
The DNR is using old and insufficient data in discussing financial assurances, she said.
The DNR will not issue a permit to mine unless they are assured that a PolyMet post-mining financial plan is in Minnesotans’ best interest, Richards said. And, he added, the public will be invited to comment further.
Executive Director Frank Ongaro of MiningMinnesota said existing state law already requires a mining company to put up enough money to take care of any environmental problems.
“The state protects the taxpayers,” Ongaro said. “No company will be released from its liability until all of those post-closure conditions are fixed.”
Ongaro said the northeastern Minnesota area that PolyMet wants to mine has “one of the largest precious metal deposits in the world,” enough to last at least 100 years.
Richards said the DNR will have inspectors at the mine to take measures to ensure that there is minimal environmental harm, which would keep down any funds needed after the mine closes.
He said there are several ways for PolyMet to put up money needed for post-mining needs. One he plans to investigate is what he called a “trust fund,” a bank account the DNR could access if PolyMet does not adequately take care of the environment.
Becky Rom of Ely, with Minnesotans for Wilderness, said that mining is bad for her area’s economy. “Mining displaces sustainable jobs.”
But a union leader disputed that.
“Mining is good for Minnesota and it has been good for 150 years,” Harry Melander of Minnesota Building Trades said.