Copper and Greed: Inside Twin Metals’ Disastrous Plan for the Boundary Waters
On December 18, 2019 Twin Metals released its Mine Plan of Operations, which outlines how the Chilean-owned company plans to process a projected 20,000 tons of ore per day, extract metals, store the waste it produces and more. While Twin Metals likes to promote the idea that this is the “kick off” to the environmental review process, the fact is, whether the company has valid mineral leases is still the subject of a hotly contested lawsuit brought by Friends of the Boundary Waters Wilderness and our partners.
Nonetheless, since the Trump administration illegally renewed Twin Metals’ federal mineral leases in May 2019, we have been anticipating this mine plan. It is the first real look at what Twin Metals’ proposed copper-sulfide mine at the edge of the Boundary Waters Wilderness will look like. This plan is a technical document that requires a high level of expertise to parse out and understand. Working with a team of experts, we are carefully studying the plan.
While the work is ongoing, here are some key takeaways.
THE MYTH OF THE ENVIRONMENTALLY FRIENDLY MINE
A favorite talking point Twin Metals likes to repeat is that it will build a supposedly “environmentally friendly” mine. The centerpiece of such a mine is in its plan to use filtered tailings (called “dry stack tailings” by Twin Metals) to store its tailings.
Tailings are the pulverized rock waste that remain after the extraction of valuable metals. The concentration of copper is low in the area where Twin Metals hopes to mine, roughly 0.5 percent. Over 99 percent of the 20,000 tons of rock it plans on processing each day will be tailings with no commercial or economic value.
Tailings release toxins into the air and water, such as lead, arsenic and mercury. Because of the reactive sulfides in the ore, when they comes into contact with water or oxygen tailings produce acid mine drainage. PolyMet, the other proposed copper- sulfide mine that is a mere 12 miles away from Twin Metals, has generated a tremendous amount of push back with its plans to store its tailings in a lake of sludge held in place by an earthen dam. This method of tailings disposal has been responsible for several catastrophic accidents that have killed hundreds of people and sent billions of gallons of toxic stew into the surrounding ecosystem.
Filtered tailings, the supposed environmentally-friendly alternative Twin Metals has put forward to store its tailings, involves stacking the tailings in a mound and does not involve this lake of sludge. This method is misleadingly referred to as “dry stacking.” In reality, the target water content for stacked tailings is about 15 percent.
It’s not dry and there is evidence that “dry” stacking can harm the environment. A 2018 report from DNR, NorthMet Project – Permit to Mine Findings of Fact, Conclusions, and Order of Commissioner, noted that, of the 100 or so dry-stacked tailings in the world, the majority were located in arid regions, where this kind of storage is more suitable. In northeastern Minnesota, the amount of rainwater would soak through and saturate the “dry” stack, which would then drain water contaminated with heavy metals into the water system. Wind erosion would further degrade the stacks and affect the surrounding environment. Overall, the report stated that environmental conditions in northeastern Minnesota were such that dry stacking would “not have significant environmental benefits over the proposed wet tailings method.”
The potential dangers cited by this study has played out at the Green Creek silver mine in Alaska. Much like the plans Twin Metals has put forward, Green Creek is an underground mine that uses filtered tailings to store its waste. Far from resulting in a harmony between industry and the environment, the mine has had a significant impact on the surrounding ecosystem.
According to the company’s own reports, wind has blown dust containing lead off the dry stacks, resulting in an increased concentration of lead in the surrounding area. At several sample sites, the amount of lead exceeded Alaska’s water quality standards.
In 1981, a baseline study of the surrounding area was conducted before the mine was built. 31 years later, independent research found that there was 646 times the amount of lead in sample areas than there was before the mine began operations. Since the mine opened, researchers have seen 11 heavy metals — including mercury, manganese and lead — increase an average of 73 times over what the pre-mining levels were in 1981. With near certainty, this can be attributed to the mine. By comparison, a control site that was not impacted by the mine, in nearby Young’s Bay, showed little increase in heavy metals from when the pre-mining baseline study was conducted.
And yet, this is the very “environmentally friendly” method Twin Metals is touting.
LACK OF WATER TREATMENT
Because Twin Metals is planning to use the filtered tailings method, it claims it will not discharge wastewater and so, will not need a water treatment plant.
This is partially based on Twin Metals claims that it will process the tailings to a point where the sulfur content is less than 0.2 percent, which it claims will be below the amount that will produce acid mine drainage. The assertion that they will build a mine with “no potential for acid generation,” as a spokeswoman for Twin Metals recently said, flies in the face of the fact that mining activity in the area has already produced acid mine drainage.
In 2010, Friends of the Boundary Waters Wilderness found evidence of acid mine drainage leaking out from Spruce Road, near the proposed Twin Metals mine. This pollution came from a bulk sample site, where 10,000 tons of rock was removed and studied in 1975, by one of the companies that first held mineral leases in the area.
If just a 10,000-ton sample (half the amount Twin Metals plans to process in a day) could produce acid mine drainage, think what a fully operational mine would do.
LOOMING FINANCIAL QUESTIONS
Though not meant to address finances, it is difficult to go through this mine plan without wondering how Twin Metals will be profitable. First, some background on Twin Metals’ shaky financial history.
Twin Metals was previously owned by Duluth Metals, a Canadian mining company. In 2014, they disclosed the projected financial returns and viability for the Twin Metals project, which, at the time, was slated to be a significantly larger mine than currently proposed. The projected initial rate of return (IRR) for the mine was only about 10 percent. An IRR is a widely accepted financial metric used to evaluate the feasibility of investments, such as building a mine or factory.
Ten percent may seem like a good return, but for a mine, it’s disastrous. So much so that this report caused Duluth Metals’ stock to plummet. Antofagasta, a Chilean mining conglomerate, swooped in and bought Twin Metals for pennies on the dollar. If it didn’t make financial sense to operate the mine in 2014, why now? What changed?
Duluth Metals based its projections off a larger mine, which, due to scale, could produce copper and nickel at a lower cost. In addition, Duluth Metals optimistically forecasted copper at $3.50 per pound. As of December 31, 2020, copper is worth 20 percent less than this projection, just $2.80 a pound.
How will a smaller mine producing metals that are less valuable be economically successful? If opened, Twin Metals would be precariously tied into the global commodities market. Because its profits would be so razor thin, it would be particularly vulnerable to economic and trading cycles. The slightest dip in copper prices could make the mine close or go bust, creating an uncertain and volatile economic situation.
While the Mine Plan of Operations provides a picture of the proposed mine, it is important to remember that whether Twin Metals can legally build this mine is still disputed. The two mineral leases Twin Metals now holds were terminated after the U.S. Forest Service determined copper-sulfide mining would cause “irrevocable harm” to this unique, water-rich environment. The leases were resurrected only after Trump came into office and Antofagasta, the Chilean company that owns Twin Metals, waged a concentrated lobbying campaign to reinstate the leases.
Friends of the Boundary Waters Wilderness sued the Trump administration, on the grounds that this move violated the law, was arbitrary and capricious. While the case is awaiting a verdict, Twin Metals is behaving like mining will be inevitable. Releasing the Mine Plan of Operations is evidence of Twin Metals’ disregard for the legal process, and how its Chilean owners believe they are entitled to our land. This document shows how little respect this foreign-owned company has for the land, and for the people who love the Boundary Waters.
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