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MiningWeek Online
December 10, 2004 Volume 10, Issue 47
This Week's Issue:
NMA: National Commission ‘overlooks coal’s potential for ending energy stalemate’
A new report by the National Commission on Energy Policy (NCEP) released this week recognizes coal’s importance but overlooks its potential for “ending the energy stalemate,” NMA President and CEO Jack N. Gerard said.
The report by the two-year old private organization was aimed at developing a “consensus strategy” to “address major long-term U.S. energy challenges.” Among other things, it contains detailed policy recommendations on clean coal technology, climate change, oil security, natural gas supply, the future of nuclear energy and other long-term challenges.
“While the Commission recognizes coal’s importance, we’re disappointed that they’ve overlooked the significant environmental improvements from coal-based plants and the enormous potential that exists to reduce greenhouse gas emissions with a broad array of technologies,” Gerard said. “This can be accomplished without jeopardizing our economy with a new regulatory program that will only raise energy costs while doing little to address climate change.”
Gerard added, “Policymakers can end the energy stalemate by regarding coal not as a problem to be overcome, but as the solution to our country’s need for affordable, secure and increasingly clean energy.”
In releasing the report, “Ending the Energy Stalemate,” Commission Co-Chair William K. Reilly, former EPA administrator, said, “Coal’s abundance in the United States, and in major developing countries like China and India, makes finding clean ways to use it among our highest priorities. Coal gasification, when combined with carbon sequestration, has the potential to revolutionize energy production.”
The report recommends providing $4 billion over 10 years in early deployment incentives for integrated gasification combined cycle coal technology (IGCC), and providing $3 billion over 10 years in public incentives to demonstrate commercial-scale carbon capture and geologic sequestration at a variety of sites. The report also recommends implementing in 2010 a mandatory, economy-wide tradable-permits system designed to curb greenhouse gas emissions, based on greenhouse gas intensity. The Commission would link “subsequent action to reduce U.S. emissions with efforts by other developed and developing nations to achieve comparable emissions reductions via a review of program efficacy and international progress in 2015.”
Rather than focusing solely on one technology such as IGCC, Gerard said, “we believe the great variety of coal types and power plants argues strongly for pursuing multiple technologies – including advanced pulverized and circulating fluidized bed technologies. Multiple technologies are more likely to reduce emissions further, increase efficiency and attract needed investment in coal-based generation,” he noted.
In addition, the Commission “nowhere recognizes the significant emissions reductions already achieved in coal-based generation,” Gerard said. “Sulfur dioxide and nitrogen oxide emissions are down about 40 percent since 1970, while economic output has increased by 164 percent. The Commission also gives no consideration to further progress possible from Clear Skies legislation, or from Clean Air Interstate Rule (CAIR) and mercury reduction regulations that are expected to reduce emissions by another 70 percent within 15 years.”
The proposed mandatory cap-and-trade system “would do little to control greenhouse gases, but would result in significant economic costs,” Gerard said. “In any event, such a system is unnecessary in view of the growing strength of voluntary efforts and the promise of new technologies” for reducing greenhouse gases.
“The real imperative for policymakers is to stop treating our most abundant, secure and low-cost energy source as a problem and start treating it as the solution for slowing the rising cost of energy and our growing dependence on offshore energy sources.”
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FWS scientists recommend sage-grouse not be listed as threatened or endangered range-wide
The U.S. Fish and Wildlife Service (FWS) this week said that based on an extensive review of scientific data and analysis, senior regional agency biologists have recommended that the Service not list the greater sage-grouse as a threatened or endangered species under the Endangered Species Act across its range.
NMA submitted comments earlier this summer explaining why the listing of the sage grouse was unwarranted. NMA also described how the many existing state, federal and local and private initiatives were effective in achieving habitat conservation and restoration. Because the sage grouse’s habitat extends from New Mexico to Washington state, a decision to not list the species will avoid lengthy delays and expensive consultations with the agency for many mineral and energy development projects.
The Service’s regional directors and senior scientists this week completed the written scientific analysis and recommendation, which is currently being finalized by technical staff before being made available to FWS Director Steve Williams. He will review the recommendation before making a decision on whether to propose the species for listing by Dec. 29.
“Our biologists have conducted a thorough review of the best available scientific information and, in their view, recommend that the greater sage-grouse does not warrant the special protections of the Act across its range,” Williams said. He said the best solution for conserving the greater sage-grouse is for federal agencies and western states to continue to support cooperative efforts to conserve and restore sage-grouse habitat.
“Together we have worked effectively with local governments, tribes, local communities, conservation groups, private landowners and other partners to conserve and restore sagebrush habitat that is vital to sage grouse and many other species,” Williams said. “We must continue -- and wherever possible expand -- these efforts to achieve measurable, on-the-ground habitat conservation and restoration.”
Currently, state fish and wildlife agencies have jurisdiction to manage greater sage-grouse. These agencies and federal agencies are developing conservation plans to address issues such as habitat loss, fragmentation, and degradation and to identify opportunities for habitat restoration and enhancement. Current sagebrush habitat is estimated at 100-150 million acres - 54 percent of historic acreage.
Under the Endangered Species Act, an “endangered” species is in danger of extinction throughout all or a significant portion of its range; a “threatened” species is likely to become endangered within the foreseeable future.
Greater sage-grouse are currently estimated to number from 142,000 to 500,000, FWS said. Sage-grouse populations declined an average of 3.5 percent per year from 1965 to 1985. Since 1986, however, populations in several states have increased or generally stabilized and the rate of decline from 1986 to 2003 slowed to 0.37 percent annually for the species across its entire range.
NMA members seeking additional information should contact Bradford Frisby (bfrisby@nma.org) or Ric Fenton (rfenton@nma.org).
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Potash royalty included in measure passed by Senate
A bill that provides a royalty reduction for potash and soda ash of 1 percent for five years was included in S. 1521, one of a package of bills that passed the Senate by unanimous consent, and now goes to the House for consideration.
NMA supported the provision and earlier this year urged its enactment by Congress. “This reduction is necessary in light of the contraction of the potash industry resulting from bankruptcies, escalating natural gas prices and increasing competition from foreign producers,” NMA President and CEO Jack N. Gerard wrote in a September letter to Rep. Barbara Cubin (R-WY).
The legislation passed by the House earlier this year was originally introduced by Rep. Steve Pearce (R-NM), whom Gerard praised for leadership in “addressing the important issues confronting the nation’s potash miners.
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Mine reclamation the focus of Harvard Design School symposium
Components that contribute to mine reclamation that is not only functional but also effectively designed were explored by speakers and participants at the Harvard Design School’s (HDS) first public symposium on the subject last week.
The “Projecting Reclamation in Design” symposium featured a wide array of nationally recognized experts, including Office of Surface Mining (OSM) Director Jeff Jarrett, who discussed topics ranging from policy and design to contemporary technologies (including digital imaging of reclamation options) and evolutionary strategies for dealing with altered landscapes. NMA was among the sponsors of the event, which was organized by Alan Berger, an HDS associate professor of landscape architecture and author of the recent book, “Reclaiming the West.”
Jarrett, who was well received by the audience of students, faculty and designers working with mining companies, discussed the history of the Surface Mining Control and Reclamation Act (SMCRA) and the benefits and obstacles inherent in a prescriptive law. Other speakers in the “Policy and Design” session included Victor Ketellapper, U.S. Environmental Protection Agency, Region VIII, superfund program/project manager; T. Allan Comp, Office of Surface Mining Watershed Assistance Team; George Antoniuk, manager, Management of Abandoned Aggregate Properties Program, Ontario, Canada; Belinda Arbogast, physical scientist, U.S. Geological Survey; and Caroline Digby, development director, Post-Mining Alliance.
Session two focused on “Contemporary Technologies and Design: Digital Reclamation,” and featured Billie Clark Jr., manager of OSM’s National Technical Innovation and Professional Services Program; and Alan Berger and one of the HDS students, who briefed the symposium on the school’s Project for Reclamation Excellence (P-REX ) effort. P-REX critically examines and promotes design as a catalyst for excellence in reclaiming landscapes that have been altered by natural resource extraction, through partnerships with institutions in design, engineering and environmental services, mining, property development and manufacturing.
The third and final session, “Altered Landscapes and Design: Evolutionary Strategies,” had presentations by Peter del Tredici, senior research scientist, Arnold Arboretum of Harvard University and lecturer in landscape architecture at the Harvard Graduate School of Design; Dorian Sagan, general partner of Sciencewriters; and Frederick Turner, an internationally known environmental ethicist and Founders Profession of Art and Humanities at the University of Texas at Dallas. Symposium presentations will be posted at www.gsd.harvard.edu/PREX.
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Corps proposes two substantive changes regarding issuance of 404 permits
The U.S. Army Corps of Engineers (COE) recently published proposal to amend nationwide permit (NWP) regulations included two substantive changes to regulations governing issuance of Clean Water Act Section 404 general permits. The proposals were published in the Federal Register on Nov. 30.
The first modification would allow District Engineers (DE) to issue verification letters that expire on the same date as the expiration date for the nationwide permit. Under the current regulations verification letters can be valid for no more than two years. The impact of the two-year term limitation is that verification letters must typically be renewed at sometime before the project is completed, creating a workload issue for the Corps and an additional regulatory burden for permittees.
The second proposed modification would increase from 30 days to 45 days the pre-construction notification review period. This is the time provided for the District Engineer to review notifications to determine whether the proposed activities will result in minimal impacts to waters of the U.S.
For some nationwide permits, the proposed activities are presumed authorized should the DE fail to respond within the specified period of time. For other permits, including NWP 21 for coal mining and NWP 44 for hard rock mining, proposed activities are never presumed authorized and must await written authorization before proceeding. Furthermore, for permits relevant to the mining industry, the Corps codified the 45-day review requirement for all NWPs requiring pre-construction review when it reissued NWPs in January 2002.
Comments on the proposals are due by Jan. 31, 2005. NMA members seeking additional information should contact Karen Bennett at (202) 463-3240 or kbennett@nma.org.
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Placer Dome projects increase in gold, copper production in 2005
In an operating outlook for 2005, Placer Dome Inc. this week said gold production is expected to total 3.7 million ounces in 2005, up from 3.6 million ounces forecast in 2004.
The increase is “due to the resumption of milling at the Golden Sunlight mine in Montana, and increased production at the North Mara mine in Tanzania and the Granny Smith mine in Australia,” the company said. “These increases will be partially offset by lower projected production at the Cortez mine in Nevada. Continued strong currencies against the U.S dollar are expected to result in higher production costs for 2005 in U.S. dollar terms. Cash costs are forecast to be between $250 and $260 per ounce, and total costs are expected to be in the $315 to $325 per ounce range, assuming prevailing foreign exchange rates.”
Placer Dome said copper production for 2005 is expected to total 430 million pounds, up from 415 million pounds forecast in 2004, “due to higher recoveries at the Zaldívar mine in Chile and increased throughput at the Osborne mine in Australia.” Cash costs are expected to be in the range of $0.60 to $0.65 per pound, and total costs are forecast at $0.75 to $0.80 per pound.
“Our production costs will continue to be influenced by currency and input cost movements,” said Peter Tomsett, Placer Dome President and CEO. “However, at prevailing gold and copper prices our margins remain healthy, which combined with forecast increased production will maintain financial performance.”
Capital expenditures are planned at $250 million in 2005. Deferred stripping expenditures are expected to total an additional $35 million. Exploration expenditures are forecast at $90 million, up from $75 million in 2004. Two-thirds of 2005 exploration spending will be directed toward exploration at existing mine sites.
“Our investments in mine site exploration are delivering results, which will be reflected in our year-end reserve estimates,” Tomsett said. “Given our recent successes and the opportunities in our portfolio, the increased budget in 2005 is fully warranted. In addition, we will be making key decisions in 2005 on our development projects in Nevada, Chile and the Dominican Republic.”
Placer Dome employs 13,000 people at 17 mines in seven countries.
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National Science Teachers Association holds Eastern Region Convention in Richmond, VA
Mining professionals from the Washington, D.C. and Richmond, Virginia areas staffed the Minerals Education Coalition Booth at the eastern regional National Science Teachers Association Convention (NSTA) Convention in Richmond, Virginia last week Over 25 volunteers were on hand from December 2-4 to distribute free mineral kits, educational materials, and industry literature to nearly 1,700 teachers.
Mineral producers and mining professionals recognize this event is an excellent forum to present the mining industry in a positive light, and the teachers are extremely appreciative of the valuable teaching materials being offered to them.
A total of thirteen mineral samples were donated by Brett Aggregates, Cleveland Cliffs Inc., The Doe Run Co., Foundation Coal Co., Luck Stone Corp., Newmont Mining Corp., North Carolina State University, Phelps Dodge Corp., R.T. Vanderbilt Co., U.S. Silica and U.S. Steel Corp.
Major Booth sponsors were the American Coal Foundation (ACF), Caterpillar Inc., E. Dillon & Co., Freeport McMoRan Inc., Joy Global Mining, Luck Stone Corp., National Mining Association (NMA), National Stone (NSSGA), Sand & Gravel Association, Phelps Dodge Corp., Rockydale Quarries, and the Society for Mining Metallurgy & Exploration (SME) National and Washington, D.C. Chapters.
Additional educational materials were provided by A Capital Resource, Energy Information Administration (EIA), Interstate Mining Compact Commission (IMCC), Minerals Information Institute (MII), Sheppard & Associates, U.S. Forest Service (USFS), U.S. Geological Survey (USGS), and the Washington, D.C. Chapter of Women in Mining (WIM).
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DOE lab develops new technology for removing arsenic from water
The Department of Energy’s Berkeley National Laboratory says it has developed a low cost, highly efficient method to remove arsenic from water at levels that will meet 2006 EPA drinking water regulations.
The process, developed by the lab’s Ashok Gadgil, is based on coating the surfaces of particles of power plant bottom ash with ferric hydroxide, and using this treated ash to react with, remove and immobilize arsenic in water supplies. Bottom ash is much less expensive than solid ferric oxide particles, which are often used as a filter media to bond arsenic species.
The lab said results using the material have demonstrated that arsenic concentrations could be reduced from 500 to 10 ppb (parts per billion) in 100 liters of arsenic-laced water with just 30 grams of media. “The current best estimate, after inclusion of industrial process costs and all business costs, is that the media will cost less than $1 per kilogram,” the laboratory said.
The Berkeley Lab said among other things, its system could be effective at removing arsenic from mine tailing leachates and from power plant boiler-blow-down streams.
For more information on the technology, visit www.lbl.gov/tt/techs/lbnl1742.html.
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NWMA Platinum Award for Corporate Excellence presented to Teck Cominco
The Northwest Mining Association’s (NWMA) Platinum Award for Corporate Excellence was presented to Teck Cominco American Inc. at the association’s 110th annual meeting in Spokane, WA, this week.
The award was among five presented during the meeting – the others were: Environmental Excellence Award to Placer Dome America’s Golden Sunlight Mine; President’s Award to Greg Hahn, president and CEO of Constellation Copper; Lyle Taylor Starter’s Award to Eric Cheney, Department of Geology, University of Washington; and Life Member Award to Lee P. (Pat) Gochnour, Gochnour & Associates, Denver, CO.
Teck Cominco was presented the Platinum Award for outstanding performance in incorporating sustainable development into the mine permitting process at the Pend Orielle Mine, Metaline Falls, WA.
The Environmental Excellence Award was presented for outstanding achievement in mine reclamation and environmental protection. The Golden Sunlight gold mine is located in Jefferson County, MT, approximately 35 miles east of Butte and five miles northeast of Whitehall.
Greg Hahn received the President’s Award for important contributions and services to NWMA. This year, he played a vital leadership role in raising money for the T. Lyle Taylor Scholarship Fund at the Mackay School of Earth Sciences and Engineering at the University of Nevada-Reno.
The Lyle Taylor Starter’s Award was given to Cheney for starting a new educational program at the Annual Meeting. The Honorary Life Member award was presented to Gochnour for contributing “endless amounts of time and energy to advancing” NWMA and the mining industry.
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Apollo Gold completes construction phase of Standard Mine in Nevada
Apollo Gold Corp. this week said it has completed the construction phase of the Standard Mine and facilities near its Florida Canyon operations in Nevada.
The Standard Mine is an open pit gold operation utilizing typical heap leaching and carbon absorption mineral processing. The new mine facility consists of a 3.2 million square foot lined leach pad, carbon plant, and various mine facilities.
Pad loading began in October 2004, with heap leaching started in November 2004 and initial gold pours are planned before the end of the year. Production will be phased up throughout 2005 with total production planned at over 40,000 ounces of gold for 2005.
Apollo Gold President and CEO, R. David Russell said, “the completion of Standard Mine construction and beginning of production represents a key milestone in Apollo’s plan for profitability and growth. Standard represents our commitment to the continuing operations in Nevada and should contribute to the growth of Apollo Gold.”
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Newsbits
Peabody Energy said it has completed the acquisition of a 25.5 percent interest in the Paso Diablo Mine in Venezuela from RAG Coal International AG for a net purchase price of $32.5 million. The transaction is expected to be accretive to earnings in the first 12 months, the company said . . . . Glamis Gold Ltd. said the first gold pour at the new El Sauzal mine in Mexico took place on Nov. 30. “Approximately 1,500 ounces of gold have now been shipped from the mine for refining and sale,” the company said. Commercial production at the mine is expected to begin this month . . . . Phelps Dodge Corp. said Peter J. Faur has been promoted to vice president-corporate communications, with responsibility for the company’s external and internal communications programs. He jointed the company in 2002 as director-corporate communications . . . . Barrick Gold Corp. said it has agreed to invest in Celtic Resources Holdings PLC as part of the company’s strategy to develop gold assets in Russia and Central Asia. Among other things, Barrick will invest cast of $28 million and receive approximately 3.7 million Celtic ordinary shares and 1.84 million Celtic ordinary share purchase warrants.
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