Obama Administration Blocks Two Mining Leases in Northern Minnesota

By Kris Maher 

The Obama administration on Thursday blocked two copper-mining leases in Minnesota, handing a victory to environmental groups that wanted to protect more than a million acres of lakes and forests in the state's Iron Range.

The Agriculture Department and Interior Department rejected the renewal of two leases that would have allowed for the mining of copper, nickel and other minerals from federally leased lands. The agencies said the step was taken to protect the Boundary Waters Canoe Area Wilderness. The U.S. Forest Service, part of the Agriculture Department, went a step further and asked Interior to withdraw parts of the watershed from consideration for future mining projects.

"The Boundary Waters is a natural treasure, special to the 150,000 who canoe, fish, and recreate there each year, and is the economic life blood to local business that depend on a pristine natural resource," said Tom Vilsack, Agriculture Secretary.

He said he asked his agency to "take a timeout" to conduct an environmental analysis and engage in public comment on whether future mining should be allowed on federal lands near the Boundary Waters.

It wasn't clear if the incoming Trump administration could easily undo the move. President-elect Donald Trump has said he wants to reverse Obama administration environmental policies that Mr. Trump argues have restricted job creation in oil and gas development and the mining sector. A spokesman for the Trump transition team couldn't immediately be reached to comment.

Twin Metals Minnesota, which had sought to renew the leases, said it was "greatly disappointed" by the administration's decision. If allowed to stand, the administration's actions "will have a devastating impact on the future economy of the Iron Range and all of Northeast Minnesota," the company said in a statement.

Twin Metals, which is owned by Chilean mining company, Antofagasta PLC, said it would continue to pursue "legal avenues" to protect its mineral rights. In September, the company filed a lawsuit in federal court in Minnesota in which it argued that the Interior Department didn't have discretion to deny renewal of the company's leases. Twin Metals said the leases were first granted by the federal government in 1966 with unlimited 10-year renewals.

Twin Metals said it has invested more than $400 million in project development activities related to the leases. The company has said it hasn't yet submitted proposed mining projects on the leases, which would be subject to a thorough environmental review by federal and state agencies.

It was the second time in a month that the Obama administration had denied an approval to a company out of environmental concerns. Earlier this month, the Department of the Army denied a permit needed by Dallas-based Energy Transfer Partners LP to complete the Dakota Access Pipeline, a four-state crude-oil pipeline, out of concerns that it endangered the drinking water of the Standing Rock Sioux.

Write to Kris Maher at [e-mail]

(END) Dow Jones Newswires

December 15, 2016 17:30 ET (22:30 GMT)

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