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MiningWeek Online
June 26, 2004 Volume 10, Issue 26
This Week's Issue:
BLM revises mining claim location and annual maintenance fees
The Bureau of Land Management (BLM) this week said it is increasing mining claim fees, which by law must be adjusted for inflation based on the Consumer Price Index (CPI). The increase affects mining claim location and maintenance fees for mining claims located on federal lands subject to the Mining Law.
The one-time location fee is now $30 for each new mining claim or site – the annual maintenance fee for each claim or site is now $125. BLM said there are now about 290,000 active mining claims on federal land, and the agency collected $28 million in mining claim fees in Fiscal 2003.
The new rule incorporating the revised fee took effect July 1 and is listed on the Federal Register website at www.archives.gov/federal_register/public_inspection/public_inspection_list.html#spec_L.
Bob Anderson, BLM deputy assistant director for minerals, realty and resource protection, said the mining fee revision is the first since August 1993 and reflects a 25 percent increase in the CPI since that time.
NMA has actively opposed mining claim fee increases, especially given the slow pace of permit processing and inefficiencies in the regulatory system. Consequently, the association supports greater permitting process efficiencies, and has urged BLM to institute a tracking system as well as encourage regulatory agencies to examine the slow pace of permit processing.
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Mercury control technologies are promising, but not yet commercially available, NMA supplemental comments say
NMA believes that “neither co-benefit nor mercury-specific control technology is commercially available for coal-fired utility boilers at predictable levels of performance,” the association said in supplemental comments filed with the Environmental Protection Agency (EPA) this week. In addition, NMA reiterated its support for comments filed by the Utility Air Regulatory Group (UARG), of which the association is a member, but outlined key differences in the positions of the two organizations.
Regarding mercury technologies, NMA said: “Although some mercury will be reduced by co-benefit technology, and promising mercury-specific technology is under development, it is premature to set a Maximum Available Control Technology (MACT) floor, New Source Performance Standard (NSPS) standard or emission allowance allocations because of the lack of reliable scientific data on mercury emissions and the performance of control technology.”
NMA added, “It is unreasonable and arbitrary to base an emissions standard on the hypothetical performance of unproven technology. This is consistent with NMA’s recommendation that emissions measurements be conducted on all affected units between 2008 and 2012, that EPA set an interim cap under a national cap-and-trade program in 2012 for implementation in 2015, and set a final cap of 15-tons for implementation in 2018. This timeline will allow for an adequate understanding of the performance of co-benefit technology before setting emission allocations, and for the development through commercial availability of mercury-specific control technology that will be necessary to achieve the 2015 and 2018 caps.”
NMA said it is “supportive of the comments being filed by UARG in this rulemaking,” but noted there are “key differences in our positions:”
- “Neither NMA nor UARG supports a MACT approach to the implementation of mercury reductions. If, however, EPA chooses to promulgate a MACT standard, NMA believes that EPA should correct for the deficiencies in the quality and accuracy of EPA’s ICR Part III data set before fuel specific emission levels are set.” NMA notes that UARG, in its comments has indicated if EPA implements a MACT standard, then it would endorse the MACT floor limits that it offered during the EPA utility MACT working group meetings. “NMA does not support these floor values – more data and analysis are needed before these values can be determined.”
- Consistent with UARG’s position, NMA proposes that a phased, national cap-and-trade program (under CAA’s Section 112) be implemented to reduce power plant mercury emissions. “However, a key distinction between our proposed alternatives is that we do not believe that EPA has data that is sufficient to support setting an interim (2015) cap, or emissions allocation factors at this time. EPA should determine emissions allocation factors by coal type and set an interim cap in 2012; this interim cap should become effective in 2015.” The cap and associated factors should be based on a co-benefits analysis of the monitoring data collected in the 2008-12 period, and an assessment of commercial availability and performance characteristics of mercury control technologies for different coal types.
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Gerard: WSJ article ‘does little to foster understanding’ of complex mercury issue
A recent Wall Street Journal (WSJ) article on mercury regulation (“Mercury Issue Takes Wing – Easing of Power-Plant Emissions Plan Fuels Rival Campaigns,” June 9) “does little to foster understanding of this complex issue,” NMA President and CEO Jack N. Gerard said in a letter-to-the-editor published in the paper this week.
“U.S. power plants account for only 1 percent of global mercury emissions. Asian sources dominate mercury deposition in the U.S., not domestic power plants. And excessive U.S. regulation does nothing to reduce Asian emissions, but could impact U.S. energy costs,” Gerard wrote.
“You imply that political influence resulted in the proposal for a market-based approach to emission reduction, but you fail to mention the proven success of this approach in reducing acid rain. By contrast, the command-and-control approach favored by some would be far more costly. In either case, studies show the result would be a single-digit drop in mercury emissions nationwide.”
Gerard also noted there is no mercury abatement technology existing today “that will make it possible for the wide variety of coal-based power plants to achieve the reductions called for by proponents of the ‘aggressive’ reductions you cite.”
Gerard concluded: “Finally, you overlook consequences that are invariably the by-products of any complex regulatory policy, including this one. Coal now accounts for more than half of the electricity generated in the U.S. The economic costs of any policy that constrains the use of coal will be significant for an economy struggling with rising energy costs.”
In a related matter, NMA this week filed supplemental comments on EPA’s proposed mercury regulations (see article, page 1).
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MINExpo® hotel rooms going quickly
It’s time to book your hotel room and register for MINExpo INTERNATIONAL® 2004. The hotel rooms are going quickly and can be booked on-line through the MINExpo® web site at www.minexpo.com/Hotel_Information.htm.
Register for the show by August 6 and save $75.00 on the registration fee. By registering on-line at www.minexpo.com/attendee_registration.htm, you will receive an immediate registration confirmation.
With more than 1068 exhibitors and more than 20 sessions and workshops, MINExpo promises to be the best show ever. For the most up-to-date show information, including sessions, exhibitors, tours and special events, please visit the MINExpo web site, www.minexpo.com.
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Major gold producers and suppliers commit to International Cyanide Management Code
Six of the world’s largest gold producers, together with three manufacturers of sodium cyanide, recently announced their commitment to the International Cyanide Management Code (ICMC), a voluntary industry program for companies involved in the production of gold.
Companies committing to the code are: AngloGold Ashanti Ltd.; Barrick Gold Corp.; Kinross Gold Corp.; Newmont Mining Corp.; Placer Dome Inc.; and Rio Tinto. These companies are responsible for approximately 30 percent of annual mined gold production worldwide. Cyanide producers committing to the code are Cyanco, CyPlus and DuPont.
The ICMC provides comprehensive guidance for best practice in the use and management of cyanide at gold mines around the world and reaches beyond the already strict requirements of most governments and regulatory agencies. It covers nine key areas – production, transportation, handling and storage, operations, decommission of facilities, worker safety, emergency response, training and communications with the public.
The code was developed by a steering committee of multi-stakeholders under the auspices of the United Nations Environment Programme and the International Council on Metals & the Environment. The committee was comprised of participants selected from government, non-government organizations, cyanide producers, labor, financial institutions and the gold mining industry.
The June 18 announcement of commitment pertains to the technical aspects of the ICMC, including the Principles, Standards and Guidance. An industry advisory group is providing support for the completion of administrative elements required to implement the certification aspects of the code, including signatory procedures, auditor qualifications and audit procedures.
Sodium cyanide is an essential chemical used in the production of gold. It is the safest process for extracting gold from the surrounding rock, utilizing a controlled application (leaching) of a dilute solution of water and sodium cyanide that percolates through the rock material, carrying the gold with it. The gold bearing solution is collected at the leach pad’s base and directed to a containment facility before it is pumped to a processing plant. Collection facilities are lined, monitored and tested by environmental professionals to confirm they are operating properly and meeting environmental standards. The cyanide use process is carefully managed throughout; it’s a condition of the mine’s operating permit that process solutions be treated to efficiently destroy or recycle the remaining free cyanide component.
The ICMC is administered by the International Cyanide Management Institute, a non-profit organization. The full text of the code and related information is available at www.cyanidecode.org.
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Industry analysis focuses on tools used for assessing stream and wetland functionality
NMA this week commended the Environmental Protection Agency (EPA) and U.S. Army Corps of Engineers (COE) for completing a stream protocol review, the “Draft Stream Mitigation Compendium,” that includes various tools for assessing stream and wetland functionality. However, concern about protocol bias and appropriateness of application and use in COE’s Section 404 regulatory program resulted in NMA and state coal mining associations commissioning a protocol review similar to the one undertaken by the agencies, which makes its own assessment and recommendations.
The report, prepared by Potesta & Associates Inc., was submitted by NMA as the association’s comments on the stream and wetland functionality tools. It focuses on protocols used to regulate surface coal mining in the Appalachian states and provides a review and technical assessment of the various stream assessment protocols currently used by the Corps in the Section 404 program for coal mining.
Like the EPA/COE compendium prepared by Nutter & Associates Inc., the Potesta report finds each protocol is unique, depending in part on its intended purpose, and that most protocols are designed for region-specific usage. In addition it finds certain protocols “are more vulnerable to user bias”, or as is the case with the protocol for Louisville, KY, “may even be developed in a way that targets or is more stringent upon a specific industry.”
The Potesta Report concludes that it is “inappropriate to rely on region-specific protocols to drive regulatory decision-making outside the region in which the protocol was derived or on certain classes of streams or at altitudes for which it was not designed.” As a result, NMA recommended that “no regulatory decision should be based upon any stream protocol that has not undergone public review.”
NMA noted the industry analysis found the Norfolk, VA, protocol as the “most straightforward, consisting of simple metrics that are consistent are repeatable.” The association recommended the Corps “seriously consider developing regional stream assessment and mitigation protocols based upon the Norfolk approach,” which is an “efficient and effective methodology that determines stream condition from five physical variables.”
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House approves funding for Corps Civil Works; Senate panel expected to markup its version soon
By a vote of 370-16, the House last week passed the Department of Energy and Water Development Appropriations Bill, Fiscal Year 2005 (H.R. 4614), approving $4.823 billion for the U.S. Army Corps of Engineers Civil Works program. This amount is $242.9 million above the FY 2004 enacted level and $703.2 million above the Bush administration’s request.
The House Report accompanying the bill includes the following observations and directives regarding the Corps’ funding decisions:
- The Corps’ top priority should be to “protect the investment already made in major water infrastructure;”
- The second priority “is to complete projects that are already under construction;”
- The third priority should be completing ongoing studies regarding constraints on the nation’s commercial navigation network;
- The Corps was directed to prepare a five-year comprehensive budget plant, beginning with Fiscal Year 2006, intended to correct the perception that the Civil Works program is “nothing more than an assortment of individual projects lacking any coherent focus or guiding principles.”
- In response to growing concern about the Corps’ ongoing practice of “reprogramming” appropriated funds from one project to another, the Committee provided detailed guidance and criteria for future reallocation of funds for all phases of a project.
In March of this year, NMA filed statements with the House and Senate Subcommittees outlining the funding levels needed for a number of lock and dam replacement projects critical to the movement of mined materials on the inland waterways system. In the House-passed measure, NMA-supported projects are funded at or above the levels requested by the administration.
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Sequoia Minerals approves merger with Cambior Inc.
Shareholders of Sequoia Minerals Inc. this week approved merging with Cambior Inc., which is now expected to take effect on July 2.
As a result of the transaction, Sequoia will become a wholly-owned subsidiary of Cambior, and Cambior will acquire the 50 percent interest in the Niobec mine currently held by Sequoia, as well as assume operation of the facility.
At the close of the transaction, Cambior will hold 100 percent of the Niobec mine and the common shares of Sequoia will be delisted from the Toronto Stock Exchange. Niobec is the only niobium mine in North America, and one of three in the world. Niobium is used to make a steel-hardening agent.
Cambior President and CEO Louis P. Gignac said the transaction conforms to the company’s growth strategy. “The Niobec mine is an excellent complement for our gold operations. We intend to put in place our innovation and continuous improvement program at this operation during the second half of the year and gradually increase its asset value over time.”
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EPA grants request to reconsider some ERP provisions; opens comment period
The Environmental Protection Agency (EPA) this week granted a request to reconsider certain aspects of the equipment replacement provisions (ERP) adopted as part of the New Source Review (NSR) reform rule finalized in October 2003.
As a result, a 60-day comment period has been initiated to allow further public comment on certain aspects of the NSR program, including:
- The basis for determining that the ERP was allowable under the Clean Air Act (CAA);
- The basis for selecting the cost threshold (20 percent of the replacement cost of the process unit) that was used in the final rule to determine if a replacement was routine; and,
- A simplified procedure for incorporating a Federal Implementation Plan into state plans to accommodate changes to the NSR rules.
NMA previously submitted comments on the reform rule in May 2003. Members seeking more information on this issue should contact Todd Johnston at 202-463-2668.
In a separate action, EPA is updating the Code of Federal Regulations and restoring the Routine Maintenance Repair and Replacement (RMRR) exclusion that was in effect prior to the adoption of the ERP in order to reflect a December 2003 appeals court stay of the final ERP rule. The stay was granted until the rule can be thoroughly reviewed by the court. The regulatory update is administrative in nature and will require no change in implementation of the RMRR, which is currently in effect.
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Newsbits
American Electric Power recently announced the following additions: Carl L. English was appointed into the new position of as president, AEP utilities; John B. Keane succeeds Jeffrey Cross as the senior vice president , general counsel, and secretary and will assume responsibility for all corporate legal affairs; Helen Murray has been appointed as vice president of customer operations; Stewart Ramsay takes a position as vice president of asset management; and Craig Rhoades is the new vice president of distribution services….Quadrem, the global eMarketplace, was named to the Supply & Demand Chain Executive Magazine’s prestigious list of companies recognized fortransforming corporate supply chains in 2003. Quadrem has appeared on the listevery year since it was first put out in 2001….The American Society of Mining and Reclamation named Peabody Energy’s Scott E. Belden as the 2004 Reclamationist of the Year. This is the fourth time in recent years a Peabody employee has been recognized by ASMR. In other Peabody Energy news, David L.Webb was recently named Operations Manager at its Highland Mining Co. unit near Morganfield, KY….P&H Mining Equipment recently announced an organizational integration between P&H MinePro Services and P&H Operations team. The two organizations will work together to help customers to lowertheir costs of production.
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