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The White House's push to secure supplies of minerals needed to
build batteries, electric vehicles, wind turbines, solar panels,
computers, and other key elements in the energy transition is
mostly drawing skepticism from mining advocates.
While the push for permitting clarity and certainty is certainly
seen as welcome by some mining advocates, other elements of the
White House plan, such as seeking royalties for hardrock mining,
protecting "special places," and establishing "responsible mining
standards," as articulated in a 22 February factsheet, raised
eyebrows.
"I don't know whether to call this two steps forward and one
step back or one step forward and one step back," Ian Lange,
director of the Colorado School of Mines' Mineral and Energy
Economics Program, told Net-Zero Business Daily 23
February.
President Joe Biden's principles for responsible
mining call for "establishing specific up-to-date, financial
assurance, operational, performance, and reclamation standards,
which require protection of the environment during exploration,
discovery, active mining, reclamation, and post-closure."
To Lange, the White House call to establish "strong, responsible
mining standards" simply means opening up a whole new round of
debate over what is deemed "responsible" and how to define the
term.
What is "responsible"?
In other words, "we are going to argue for a long time over what
is responsible," said Lang, who, prior to his current position,
served as a natural resources economist for the White House Council
of Economic Advisers from December 2019 through April 2021.
Hardrock mining on public lands—which includes gold, silver,
copper, uranium, lithium, cobalt, nickel, and nearly all critical
minerals—is still governed by the General Mining Law of 1872
that the White House wants reformed. Echoing the White House's 22
February fact sheet, the US Department of Interior said the same day it was
establishing an Interagency Task Force that would be charged with
making recommendations to the antiquated law, which it described as
"a law that was born out of the California Gold Rush."
According to Interior, this law allows mining companies to stake
claims on the vast majority of public lands, regardless of
potential conflicts with other uses. It also does not require
royalties to be paid to the taxpayer for the extraction and sale of
valuable minerals, and does not include any financial assurance
such as bonding to ensure environmental cleanup and site
reclamation.
In a September 2020 blog, the US
Government Accountability Office found that "there are 872
authorized mining operations on about 1.3 million acres of federal
land as of September 2018—most of which aren't subject to
royalties."
Congressional action needed
However, environmental lawyers say these changes will largely
require congressional action, not a mere statement of White House
intent. And they all acknowledge that the current polarized
environment of a US Senate that is equally divided among
Republicans and Democrats makes it difficult for any congressional
action. This objective is complicated further, according to Lange,
because "Democrats themselves are not on the page when it comes to
mining."
"We believe the administration is trying to work within the
confines of the existing legislative framework as much as it can,
but it's acknowledging that it will need to work with Congress to
meet some of its goals," Lyndsay Gorton, a Washington DC-based
attorney with law firm Crowell & Moring told Net-Zero
Business Daily.
Gorton pointed to the interagency task force that the White
House has just charged with developing recommendations for Congress
by November to consider legislative and regulatory reform of mine
permitting and oversight that the 1872 mining law currently
governs.
"So without knowing exactly now what the recommendations are
going to be, because this was issued on Tuesday, it's hard to know
what will require legislative and what will drive regulatory
action, but the administration is at least thinking ahead about
what they are going to need to do, and they are prepared to work
with Congress," Gorton said. "
Existing regulations offer opportunity
Mining opponents such as Earthworks, though supportive of White
House efforts, are understandably skeptical too because they want
to see whether the administration will deliver on environmental
justice promises to protect marginalized communities from the
"historic and ongoing injustices of unfettered extraction."
According to Earthworks Senior Policy Counsel Aaron Mintzes, the
Biden administration can easily craft regulations to require
financial assurances from companies engaged in hardrock mining on
federal lands. The group petitioned the Biden
administration in September 2021, asking them to update regulations
that seek to clarify federal authority to protect tribal and
cultural resources and values as well as wildlife, water quality
and quantity, exercise authority to verify mining rights and close
loopholes that allow the mining industry to escape public review
and consultation.
He said the US Congress gave both Interior and the Department of
Agriculture authority to regulate hardrock mining on the lands they
manage through the Federal Land Policy and Management Act (FLPMA)
of 1976 and the Forest Service Organic Act of 1897. The Trump
administration initiated rulemakings at both agencies during its
four-year tenure from 2017 through 2021, but never completed
them.
Just before leaving office, the Trump administration also
identified mining as a sector to a federal rule aimed at
streamlining infrastructure permitting.
Prior to that, the Obama administration issued a US
Environmental Protection Agency rule requiring hardrock mining
financial assurances a week before it left office in January 2017.
The Trump administration, however, decided against finalizing that
rule in February 2018, and a federal court upheld the agency's
decision in July 2019.
Mining interests remain unpersuaded
Some vested interests don't see any need for changes to the
rule, and they question whether the Biden administration is barking
up the wrong tree.
Lange from the Colorado's School of Mines said the White House
is sounding all the right words, but it is a different story
altogether when you read between the lines.
The National Mining Association (NMA), a trade group for US
mining companies, questioned the White House's efforts to reform
the mining law as part of its push to boost domestic minerals
supply chain.
"We would hope that the administration's examination of minerals
supply chain issues would focus on how to restore US mining's
competitiveness on the global stage, decrease our import reliance,
and ensure that existing federal and state regulations are not
duplicated," NMA spokeswoman Ashley Burke said in a statement.
Instead, Burke said, "Interior's language suggests it
is using the supply chain review as a thinly veiled attempt to
advance misguided mining law reforms that have failed in Congress
time and time again."
While Burke did not identify the specific pieces of failed
legislation, she said "the US mining industry has long said that it
is open to a reasonable royalty, but it is important to understand
what the mining law is—and what it isn't."
Burke maintained that the only things secured by the White House
efforts will be a duplication of robust environmental and financial
assurance regulations that already exist on both the federal and
state levels and a ramping up of import dependence and supply chain
issues.
Minerals demand on the rise
Ahead of the one-year anniversary of his executive order on securing
supply chains, Biden joined California Governor Gavin Newsom and
the CEOs of a number of mining and processing companies on 22
February to announce a series of initiatives to boost supply chains
for minerals such as lithium and cobalt, for which he said demand
will increase by 400-600% over the next several decades.
"And up to now," Biden said, "we've had to import a significant
portion of them—close to 100% importation—from other
countries, particularly China, Australia, and Chile."
There is no question that US mining production lags behind
demand. The US Geological Survey (USGS) in February estimated
that 48 million metric tons (mt) of copper can be mined and
processed economically domestically, as well as 69 million mt of
cobalt, 340 million mt of nickel, and 750 million mt of
lithium.
Despite having ample reserves of these four key minerals, USGS
mineral commodity summaries for
2022 released 1 February revealed that the US in 2021 imported
48% of its consumption of nickel, 76% of its cobalt, 45% of refined
copper, and more than 25% of lithium.
Biden said when he signed the executive order to secure supply
chains a year, "I was determined to change all that."
As evidence of progress made toward securing domestic supplies,
Biden pointed to the $35 million contract MP Materials secured from
the Department of Defense's Industrial Base Analysis and
Sustainment program to separate and process heavy rare earth
elements at the company's facility in Mountain Pass, California,
for use in wind turbines, electric vehicle, and battery
magnets.
He also noted the recently announced partnership between Redwood
Materials with Ford and Volvo to recycle lithium-ion batteries, and
plans by Berkshire Hathaway Energy Renewables to extract lithium
from geothermal brines in the Salton Sea in California.
Colorado School of Mines' Lange said the announcements made by
Biden are positive steps because the White House is letting
companies know "they are going to get things done." However, Lange
added the administration is sending muddled messages to companies
when they begin discussions about financial assurances.
"What will really be a game changer is permitting certainty," he
added.
Permitting certainty
Neal McAliley, a Miami-based attorney with the law firm Carlton
Fields who has been involved in assessing the environmental impacts
of projects, agrees with Lange on the need for more certainty in
the process.
He told Net-Zero Business Daily that one of the main
ways that the federal government can boost mineral production is by
streamlining environmental reviews.
The National Environmental Policy Act (NEPA) requires federal
agencies to conduct environmental reviews of any permits issued to
mine, drill, or build on public lands.
"In theory, the federal government should be able to streamline
the review process to accelerate the process, but in practice it is
not so easy," McAliley said.
"You can make it go faster, but there are limits," he added.
In an ideal situation, a NEPA review can take at least 90 days,
but it can extend out to multiple years, according to a 2008 study
of federal agencies.
"If you look at NEPA regulations, most of the time involved in
preparing an environmental impact statement (EIS) is the time it
takes to pull together the draft and final document, which
typically takes many months," McAliley said.
Apart from federal reviews, states carry out their own
environmental reviews, which don't always necessarily take place at
the same time. For instance, McAliley pointed to Florida, where
officials in some cases require that all federally reviewed plans
for any activity on public lands be completed in minute detail
before a state environmental review can even begin.
Of the 67 lithium mines under development, the Carolina Lithium
Project has been held up since last summer because North Carolina's
Gaston County Board of Supervisors has refused to grant zoning
permits over concerns about the mine's impact on groundwater and
air quality. This is despite receiving federal and state
approvals.
Channeling US President Dwight Eisenhower's description of the
military industrial complex, McAliley said the environmental laws
and related complicated procedures have created what is "an
environmental administrative complex."
The positive aspect is that each step of the permitting process
is thoroughly examined from every possible angle so it can
withstand legal challenges, he said. The negative is that the depth
of review is slow.
Posted 25 February 2022 by Amena Saiyid, Senior Climate and Energy Research Analyst
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