This presentation was part of a talk by the author at the San Juan Mine Reclamation Conference in 2016. It discusses obstacles to the potentially beneficial re-mining of formerly mined lands and suggests a policy framework going forward.

1. Unblocking the Roadblocks to
Environmentally Beneficial
Re-mining
Mark Levin, P.E.
Mining & Environmental Services, LLC

2. Technical resource on projects involving specialized underground mine evaluation, physical or
subsidence hazards, development and remedial cost estimation, and/or environmental
evaluation at over 460 mine sites.
Construction contractor or construction project manager for tunnel/mine/mill rehabilitation,
closure, development, special project or cleanup work at over 150 sites.
Specializing in bulkheading for mine drainage control.

3. Colorado has a rich endowment of mineral resources
and mining history, with approximately 30,000 to
40,000 inactive mines of various sizes. Ranging from
small prospects to major operations; these mines ran
for decades and employed thousands of people.

4. We are left with the legacy of waste rock, water
pollution and safety hazards from mining
operations conducted before the advent of current
reclamation and other environmental laws.

5. Local governments, NGOs interested in improving water
quality, and private companies interested in either resource or
land development are all deterred from involvement with
inactive mining properties with water discharges, due to
potential Clean Water Act and Superfund liability associated
with existing mine drainage.
For over two decades, parties with various interests have
debated “Good Samaritan” amendments to the Clean Water
Act, without any resolution.

6. WHY CONSIDER RE-MINING?

7. Taxpayer funding alone cannot begin to touch the entire
problem, and should not – other priorities for Government
environmental funds exist and many of those needs are more
urgently tied to mitigation of greater health or environmental
risks than remediation of old mines in remote areas.

8. We are already living with the historic
environmental impacts of past mining, so why not
have some economic benefits to go along with
them?
A new “Mining Brownfields” regulatory approach
to encourage exploration and re-mining of
historic mineral districts, while providing tangible
environmental benefits as part of the work, may
be worth considering.

9. BARRIERS TO NEW MINERAL EXPLORATION AND
DEVELOPMENT IN HISTORIC MINING DISTRICTS

10.  Superfund (CERCLA) Liability – any company
acquiring and exploring an old mining property with
environmental impairment could become a Potentially
Responsible Party (“PRP”), even if doing everything
right.
This scares the investment community: in many
other jurisdictions, the most you can lose on a
mining investment is 100% of everything you
invested – in the US, there is significant financial risk
beyond that.

11. CERCLA LIABILITY
The framework of the National Priorities List
(“Superfund”) cleanup approach to investigate and
remediate is rooted in a legalistic, adversarial model,
tied to the concept of cost recovery from PRPs, and thus
the steps in that process often lead to long timeframes
and substantially more costs than might otherwise be
necessary.

12. But, most of the historic mines which have present day environmental problems were
operated in substantial compliance with the environmental laws and standards of the
time, and continued to operate until they lost money for an extended period.
This is because the original underlying conceptual model for CERCLA liability provisions
was one of seeking justice from greedy corporations knowingly sacrificing the
environment for more profit, in an era of growing public awareness and outrage over
chemical pollution, rivers catching fire, Love Canal, Silent Spring, etc..

13. Activist groups call for financial attacks on “Potentially
Responsible Parties”, but few active owners or operators
of these historic mines exist.

14. Our society at that time was not willing to incur the added cost for
the environmental externalities…
And, we still enjoy the benefits of much of those mined products
even today.
The entire output of metals were provided to the
benefit of the growing American economy in a
competitive market at prices that did not include
accounting for the external costs of environmental
damage by our current definitions.

15. Clean Water Act
The current CWA framework essentially looks at old mines with existing discharges as if they
were newly created point sources if a potential new operator attempts to get an NPDES permit
for the existing drainage. There is no readily available flexibility for recognizing existing water
quality impacts from historic mines as a baseline for establishing new permit limits.
Result:
• Proposed effluent limits that may not be technically attainable or realistic from an economic
perspective
• Possible perpetual treatment liability if project proceeds
• Lost opportunities for improvement of water quality - better just isn’t good enough.

16.  Regulatory Hypocrisy – mine cleanup standards
for government or NGO funded remediation projects are often
essentially relaxed ‘best efforts’ approaches, but for private
companies considering re-mining of historic sites, economically
impossible and technically impractical perfection is often the
requirement.
 “Perfection is the Enemy of Good”
 Pareto’s Rule – 80% of results typically achieved with 20% of
the cost. 100% at infinite cost.
 “Cost/Benefit Ratio Matters” – for Everyone!
Misallocation of either public or private money hurts the
overall economy and our nation’s wealth.

17.  Fragmented mineral estate

18. Environmental “NIMBY” Hypocrisy
 We all use enormous amounts of mined materials in our
daily lives – often without realizing it.
 Modern mines in the US produce within a framework of
high standards for wages, worker safety, and environmental
protection.
 Yet, it has become fashionable for some to oppose mineral
resource development in our backyards, while happily using
mass amounts of imported finished goods made with
mineral commodities that are sourced from areas where
there are very low environmental and safety standards, and
at slave labor wages.
 Efforts to render local production infeasible or uneconomic
simply displace the externalities elsewhere, and often, to a
much greater degree.

23. POSSIBLE SOLUTIONS:
 Use of permanent CERCLA (non-NPL) Agreements on
Consent (AOCs) or other means to negotiate agreements to
encourage exploration and re-mining linked to tangible
environmental betterment.
 Amendments to the Clean Water Act to enable permitting of
existing discharges using status quo as baseline for mass
loading / effluent limitations.
 Expedited permitting processes for mineral exploration and
development projects that are tied to environmental
remediation
 Expedited permitting or permit waivers for removal and
reprocessing of historic waste piles - (Montana does this
already).

24.  Policy changes to allow “trading” of environmental remediation for
flexibility and attainment of maximum environmental benefit for
funds expended, based in area-specific needs.
This could potentially involve impact reduction swaps across:
o Types of loading, e.g. - Storm water for point source;
o Media – water vs. soils;
o Watershed basins;
o Contaminants;
o Values– critical habitat vs. non-critical, visual, etc.
 Establishing a fair legal framework for unitization of fragmented
mineral estates into viable size for exploration and redevelopment.
Principles for this should include a pooled royalty structure for the
current owners.

25. Example of Successful Approach in Canada:
Keno Hill District, Yukon Territory –
• High grade silver mining district with significant legacy environmental issues
• Former owner - United Keno Hill Mines - bankruptcy ca. 2000
Alexco Resources Deal with Government and Bankruptcy Trustee
• Alexco gets mineral rights – initiates new exploration and mining program
• Alexco acts as environmental contractor to Government – full indemnity for past environmental
conditions. Alexco responsible for new mine disturbance.
• Mixture of Government and private funding from Alexco for cleanup and O&M

27. THANK YOU
ANY QUESTIONS?