U.S. blocks mining in parts of Minnesota, dealing latest blow to Antofagasta's copper project (updated)

Polymet Mining

26/01/2023 19:53

(Adds details of mineral withdrawal, reaction from various
parties)
    By Ernest Scheyder
       Jan 26 (Reuters) - The U.S. Interior Department on
Thursday blocked mining in part of northeast Minnesota for 20
years, the latest blow to Antofagasta Plc's  ANTO.L  Twin Metals
copper and nickel mining project but a step officials said is
needed to protect the state's vast network of interconnected
waterways.
    The decision further escalates the U.S. tension over where
and how to procure the minerals crucial for the green energy
transition. Copper and nickel are used to build electric
vehicles, solar panels, wind turbines and other renewable energy
devices. 
    While Congress and President Joe Biden have heavily
subsidized mining and minerals processing, administration
officials said the risk from a mine to northern Minnesota's
ecology was too great. 
    "With an eye toward protecting this special place for future
generations, I have made this decision using the best available
science and extensive public input," said Interior Secretary Deb
Haaland, who signed an order on Thursday morning withdrawing
225,504 acres in the Superior National Forest from leasing to
mining or geothermal companies through 2043. 
    Representatives for Chile-based Antofagasta could not
immediately be reached for comment.
    The region is visited each year by more than 150,000 outdoor
enthusiasts, many of whom have long feared that any mine
disaster could pollute rivers and quickly spread through the 1.1
million acres of the Boundary Waters Canoe Area Wilderness and
into the Great Lakes. 
    The underground Twin Metals mine would, if built, be a major
U.S. source of copper and nickel. The only existing U.S. nickel
mine is set to close by 2025. 
    Haaland's decision, which had been expected, came after U.S.
officials canceled the Twin Metals leases last January and
rejected the mine's plan of operations, steps that essentially
killed the project. 
    Antofagasta sued last August, claiming the decision was
"arbitrary and capricious." The leases were first granted in
1966 and have been passed between successor companies. No mining
has taken place at the site, near the town of Ely. Thursday's
move deals another roadblock to the project, regardless of the
court's decision.
    Administration officials said they do not believe blocking
the Twin Metals project showed they do not support mining. 
    "The Biden-Harris administration has been clear in our
commitment to ensuring this country can mine for the minerals
that are necessary to help us shift to a clean energy economy,
but we have to do so in a responsible manner," an Interior
Department official said.  
    'IRREPARABLE HARM'
    Antofagasta has long said it would use the most-advanced
equipment to protect the environment, but officials noted other
recent mining disasters as evidence of "irreparable harm" should
the company's efforts fail. Administration officials added they
believed the region's economy would benefit more from
recreational activity than mining. 
    The officials said it was unclear whether future
administrations could reverse the 20-year decision. Only
Congress can make the ban permanent. 
    Environmentalists cheered the decision. "You don't let the
most polluting industry in America operate next to a pristine
wilderness that contains an abundant supply of the cleanest
water in the country," said Chris Knopf of Friends of the
Boundary Waters Wilderness. 
    The mineral withdrawal does not affect Minnesota taconite
iron ore mines operated by U.S. Steel  X.N , ArcelorMittal SA
 MT.LU  and Cleveland-Cliffs Inc  CLF.N . 
    The order also does not affect a proposed nickel mine from
Talon Metals Corp  TLO.TO , which last year received funding
from the Biden administration, nor PolyMet Mining Corp's
 POM.TO  plans to build a copper and nickel mine in the state.
 (Reporting by Ernest Scheyder; Editing by Mark Porter and
Daniel Wallis)
 ((ernest.scheyder@thomsonreuters.com; Twitter: @ErnestScheyder;
+1-713-210-8512; Reuters Messaging:
ernest.scheyder.thomsonreuters.com@reuters.net))