MINNEAPOLIS — Two longstanding mineral rights leases that are critical for a proposed large underground copper-nickel mine upstream from the pristine Boundary Waters Canoe Area Wilderness in northeastern Minnesota will not be renewed, two federal agencies announced Thursday, but the company said it will press forward.
The decision by the Interior and Agriculture departments strikes a serious blow to the proposed $2.8 billion Twin Metals project near Ely, about 250 miles north of Minneapolis. The agencies also announced other steps to protect the Boundary Waters watershed from future mining projects.
However, the incoming administration of President-elect Donald Trump potentially could reverse the decision. Trump's nominee for interior secretary, Rep. Ryan Zinke of Montana, has advocated for increased mining on federal lands.
In a statement, the agencies cited "broad concerns from thousands of public comments and input about potential impacts of mining on the wilderness area's watershed, fish and wildlife, and the nearly $45 million recreation economy."
Twin Metals Minnesota, which sued the federal government in September to force renewal of its leases, said it will continue pursuing its legal options. The lawsuit remains pending. The company issued a statement saying that if the decision stands, it "will have a devastating impact on the future economy of the Iron Range and all of Northeast Minnesota, eliminating the promise of thousands of good-paying jobs and billions of dollars in investment in the region."
But environmental groups that had fought the project for years welcomed the announcement.
Becky Rom, national chair of the Campaign to Save the Boundary Waters, said she believes the project is dead, and that it would be legally difficult for the Trump administration to undo the decision, but vowed that opponents will keep up the fight.
"We're going to continue to make our case to policymakers and the American public to raise awareness of this issue," she said. "By no means is our work done."
But Frank Ongaro, executive director of the trade group Mining Minnesota, called the decision "a perfect example of why Democrats lost rural America." It will chase investment away from the U.S. and make the country more dependent on foreign governments for metals, he said. He expressed hope that the Trump administration will revisit the decision.
Agriculture Secretary Tom Vilsack said the agencies plan to take a two-year "time out" to conduct a careful environmental analysis and engage the public on whether future mining should be authorized on any federal land adjacent to the Boundary Waters. His agency runs the Forest Service, which manages the wilderness area and nearby federal lands where Twin Metals wants to mine.
Interior Secretary Sally Jewell noted that the Boundary Waters is the most visited federally designated wilderness area in the U.S., with 150,000 visitors annually. Her department runs the Bureau of Land Management, which controls the leases.
If the "time out" goes forward under the new administration, no new mineral exploration or development applications would be accepted for lands within the Boundary Waters watershed while the agencies conduct an environmental analysis to determine if the lands should be withdrawn for 20 years. A permanent withdrawal would require congressional approval.
The leases were first issued in 1966 and last renewed in 2004. They would have allowed the company to mine copper, nickel and platinum-palladium-gold group metals southeast of Ely. Environmentalists objected because the metals are bound up in sulfide-bearing minerals that can leach sulfuric acid and other pollutants when exposed to air and water. The agencies said acid mine drainage would pose a significant risk to the Boundary Waters.
But Twin Metals, which is owned by the Chilean mining group Antofagasta, said it can mine without damaging the wilderness while creating generations of badly needed jobs in an economically struggling region of the state.
Thursday's decision does not affect a copper-nickel mining project several miles to the southwest called PolyMet, which sits in a different watershed that eventually flows into Lake Superior. PolyMet, which is partly owned by Swiss commodities giant Glencore, is further along in the process. It has successfully completed its environmental review and is now applying for the necessary permits. The groups that oppose Twin Metals have also fought PolyMet.