Treasure above, riches below: Mining on the edge of the BWCA

(FOX 9) - In the coming months, Twin Metals will reveal more and more of its plan for a controversial underground copper and nickel mine near Ely, Minnesota, just five miles from the Boundary Waters Canoe Area.

The FOX 9 Investigators got an inside look at the company’s plan, the controversy, and the high stakes for people on both sides of the issue.

“It really starts now,” said Julie Padilla, Chief Regulatory Officer for Twin Metals.  

“We will be a model mine for this state and the most sustainable mine that this state has seen to date,” said Padilla.

Environmental groups are skeptical of such lofty promises.

“Most people go, ‘are you kidding?’ Next to the Boundary Waters, of all places?” said Steve Piragis, one of the founding members of Save The Boundary Waters.

JOBS VS. THE ENVIRONMENT

In the town of Ely, you will hear a familiar refrain.  

“Ely is dying, slowly,” said Nikki Engen, who comes from a fourth generation mining family.

The front yard of her tidy home is covered with signs supporting the Twin Metals mine, including a street festival last weekend called “Twin Metals Appreciation Days.”

“We can keep the Boundary Waters and do this,” said Engen. “Drive down Main Street, look at how many businesses are empty.”  

Ely was built on mining, but since the last mine closed in the 1980s, it has been surviving on tourism. Its population peaked at 6,156 in 1930, but is little more than 3,387 today. Many fear the town is becoming a retirement community. The high school graduation class this year was only 32.

Twin Metals has promised its mine would generate more than 600 jobs, many paying nearly six figures. The company claims the mine would generate 1,400 spinoff jobs. 

However, one study from a Harvard economist claimed the mine would also create a boom and bust economy, dependent on global markets. 

“That’s a bunch of hooey,” said Chuck Novak, Ely’s irascible and charismatic mayor. “Boom bust. Boom bust. Okay, that happens with mining.”

TO THE CORE AND BACK

Twin Metals has already spent $450 million dollars in exploration without mining a single rock. There is good reason for that investment.

The area targeted in the Superior National Forest contains one of the largest undeveloped deposits of copper and nickel ore in the entire world, along with other precious minerals like gold, silver, platinum, and palladium. 

When the core sample is sprayed with water, minerals bound to the sulfide ore reveal themselves as gold color flecks. The color is an appropriate metaphor.

Some have estimated the deposits to be worth at least $50 billion, and no one knows the riches that lie beneath quite like Twin Metals.

The company’s massive warehouse in Ely contains 1.5 million feet of core samples that, if stacked from end to end, would stretch from Ely to St. Paul and halfway back again.  

“We’ve taken the largest exploration drilling program in the State of Minnesota to determine this deposit,” said Dean DeBeltz, Twin Metals Director of Operations and Safety. 

“It gives us confidence in knowing where the ore is,” said DeBeltz. “From a geologic standpoint it’s very contained within a defined band.”

A SURGICAL EXTRACTION 5,000 FEET DOWN

Twin Metals is focusing on an area known as the Maturi Deposit, and claim they will perform a “surgical extraction” of the minerals that run in a thin vein from 100 to 400 feet wide (averaging 200 feet).  

To get to the deposit, Twin Metals is planning on building a large underground mine shaft at a 30 degree angle, 400 to 5,000 feet below the surface.  

Miners will crush the rock underground, bringing it back up to an indoor facility the size of a Super Target store on a 120-acre property, where the minerals will be separated using a gravity floatation system. 

A fine powder of copper and nickel ore will be shipped off site for further processing.

What is left over are the so-called mine tailings, after the 4 percent of the ore that contains copper, nickel, platinum, palladium, gold and silver are extracted. Mine tailings generally contain sulfur, which when exposed to air and water, produce acid runoff.  

The company is planning for half of the mine tailings to be mixed with cement and go back underground to support the mine structure.  

The company recently revealed the other half of the mine tailings will remain above ground using a process called dry stacking. Those tailings will be the consistency of “sandcastle sand” in a lined basin that will be topped with native soil and vegetation. 

The so-called dry stack will be a 120-foot tall hill somewhere near the processing facility. 

Twin Metals claims its mine tailings will be “non-acid producing” and contain between .12 and .15 percent sulfur, which the company said is below a .2 percent threshold that is consistent with the local geology.  

On-going hydrology tests have revealed there is very little ground water below 400 feet, and the company expects it will be a “dry mine.”

“You can walk on top of the mine, you can hunt on top of the mine; logging will happen,” said Padilla, who is charge of getting the project approved by state and federal regulators. “The Superior National Forest is a working forest in this area.”

TOO CLOSE FOR COMFORT?

What makes the project so controversial is its location. Twin Metals is focused on an area known as the Maturi Deposit, located next to Birch Lake and the Kawishiwi River. It is part of the Rainey River Watershed, which eventually leads into the BWCA. 

“Once it gets through the mine site and gets through the three or four lakes to the Boundary Waters, it’s over,” said Piragis, who also owns Piragis Northwoods Company, an outfitting store in Ely.  

Piragis, who came to the area in the 1970s as a biologist with the EPA, echoed the concern of scientists who say the geology of the BWCA, which has no limestone or calcium to absorb acid run off, makes it particularly vulnerable.

“Acid mine drainage is hard to predict and control,” said Piragis. 

“Huge piles of rock with a tiny bit of sulfide mineralization in it, it leaches slowly and insidiously into the watershed. It leads to a pollution issue you just can’t stop,” said Piragis.  

But, Twin Metals contends those are issues with traditional open pit mining, and not the state-of-the-art facility they are planning. 

“Our tailings that we leave behind will be non-acid generating,” said Padilla. “So we will have non-acid generating tailings and no waste rock on the surface.”

The mines processing facility will use water from Birch Lake Reservoir, between 300,000 and 600,000 gallons per day. By comparison, the entire town of Ely uses 533,000 gallons per day.

Any water drainage from mining or runoff from dry stacking storage, the company contends, will be recycled back into the processing facility in a “closed loop” or “zero discharge” process. 

A POLITICAL FOOTBALL AND A CHILEAN BILLIONAIRE

During a visit to Burnsville last April, President Trump said Minnesota’s natural resources had been “put under lock and key” and “just ripped away.”

The next month, the Trump Administration renewed Twin Metals leases for mining that the Obama Administration’s Department of Interior failed to renew in December 2016. Various incarnations of the company had held those leases for 50 years and 10 presidential administrations.   

Former DNR Commissioner, Tom Landwehr, who now runs Save The Boundary Waters, was not surprised.

“The administration has said we are going to unlock the resources in the public lands of the United States, and they’ve done it in a very haphazard manner,” said Landwehr.  

“The copper nickel mine is a political football,” said Ely’s Mayor Chuck Novak, who sounds more than a little resentful of the politicians in St. Paul and Washington, D.C. who have been calling the shots. “The Obama Administration took the football. The Trump Administration gave it back.”

Twin Metals Minnesota, LLC, is a wholly owned subsidiary of Antofagasta, a Chilean mining conglomerate, which purchased the company in 2015.

Beginning in 2016, Antofagasta launched an intense lobbying effort revealed in 5,000 pages of documents obtained under the Freedom of Information Act by Louis Galdieri, a documentary filmmaker who follows Midwest mining issues.  

Those memos and official calendars show high-level meetings between Antofagasta executives and top officials at the White House and the U.S. Embassy in Santiago, Chile. 

“All of this was done behind closed doors and away from public view, so you have to ask yourself, why is that?” said Galdieri.

Antofagasta is controlled by the family of billionaire Andronico Luksic, who according to reporting from the Wall Street Journal and the New York Times, in January 2016 purchased a $5 million home in Washington, D.C., that days later was rented out to presidential advisors Jared Kushner and Ivanka Trump. 

Antofagasta said the renting of the home had no bearing on the mine leases.  

A LONG WAY TO GO

“We are connecting the dots here. We don’t have a smoking gun, but when you connect the dots here there are grave concerns,” said Landweher, whose group has joined a lawsuit against the Trump Administration to terminate the mining leases. 

Twin Metals is expected to submit a formal plan of operation in the coming months. That plan will then go through a yearlong environmental review process, followed by a permitting process with the Minnesota Pollution Control Agency and the Minnesota Department of Natural Resources.   

“For us, the political winds are just part of what we are dealing with,” said Padilla of Twin Metals. “Regardless of what happens in 2020, we aren’t focused on political winds or ideology, we’re focused on moving the best project we can forward.”