EPA accused of power grab

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Backers of a massive planned gold and copper mining operation in Alaska are accusing the Environmental Protection Agency (EPA) of going to unprecedented lengths to torpedo the project.

The Pebble Mine, potentially the largest mine of its kind in the world, has been dealt a series of financial, political and regulatory setbacks, most recently via an EPA move in February that could halt the project’s permitting process.

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The mine’s developers insist the project remains viable, and are poised to launch a multi-pronged legal and administrative assault against the agency decision. They warn the outcome of the fight could hold implications for future projects.

“We believe that we have become the poster child for an expansion of EPA authority,” said Tom Collier, CEO of the Pebble Partnership.

The partnership planned to file documents late Tuesday challenging the EPA’s use of an obscure Clean Water Act provision to delay the project pending further environmental review. Of particular concern, the agency said, is the world’s largest sockeye salmon fishery in nearby Bristol Bay.

Permitting decisions for such projects are generally the province of the U.S. Army Corps of Engineers, though the EPA has veto power. 

That power is seldom used; the EPA has exercised it roughly a dozen times over the years.

In its formal response to be sent Tuesday, the Pebble Partnership says the February action marked the first time the EPA has initiated the action before permit applications have been filed — a preemptive strike the developers view as a bid to sabotage the project.

“Rather than allowing the filing of a mining permit application, EPA employees secretly plotted with environmental activists to undermine the ability of land owners to objectively evaluate and develop the proposed mining of the Pebble deposit in Southwest Alaska ... thereby establishing a precedent that will have long-term harmful impacts on investment and job creation in the United States,” the group wrote.

Agency officials deny the accusations, and say the action was taken to allow more time to build on EPA research about the plan’s environmental implications.

The Pebble Mine decision does not reflect an EPA policy change in mine permitting, the agency said.

“There’s no power grab here, because what we’ve essentially said is: ‘We think there might be a problem here, but we’re not making our mind up on that. Can you give us more information to help assuage the concerns that we have?’ ” according to a high-ranking EPA official with knowledge of the agency’s thinking.

The EPA move is just the latest obstacle for the project, which appears to have lost steam in recent months.

The Pebble Partnership originally included a pair of mining companies: the Canadian firm Northern Dynasty and U.K.-based Anglo American. Anglo pulled out last September, and the project lost an important investor this month when the Rio Tinto Group cut ties and donated its 19 percent stake in the mine to a pair of Alaskan charities.

Collier said the partnership is in talks with half a dozen potential investment partners, and said interest in the project is high, given the bounty of undiscovered copper, gold and other minerals present at the massive deposit.

If realized, the project would generate an estimated 15,000 permanent jobs, including thousands in Alaska, and as many as 22,000 temporary jobs during the construction phase, Collier said.

Still, the partnership has failed to shore up support from the state’s congressional delegation, with Democratic Sen. Mark Begich declaring the project “the wrong mine in the wrong place.”

The value of salmon exports from Bristol Bay was about $250 million in 2010, or about 6 percent of the total value of all U.S. seafood exports at the time, according to a report by the Institute of Social and Economic Research at the University of Alaska in Anchorage from 2013 that is cited by the mine’s opponents. The report cites the salmon industry as supporting more than 11,000 jobs.

While Pebble has largely shifted its strategy away from direct lobbying — partially due to limited resources — the environmental groups that oppose the mine are putting up a unified front. 

The Natural Defense Resources Council (NRDC) is employing every tool in its arsenal to persuade policymakers and private interests against backing the mine.

“This is one of the worst projects anywhere in the world today. I’ve been doing this work for 35 years, and I’ve never seen a worse idea,” Joel Reynolds, the NRDC’s western director, told The Hill from his office in Santa Monica, Calif. 

“The idea that you would put one of the largest open-pit mines in North America in the headwaters of the greatest wild salmon fisheries the world is not just wrong, it’s insane.”

The NRDC is working to keep investors and businesses from partnering with the mine developers.

Reynolds went to Tokyo to meet with Mitsubishi, an initial partner that held an 11 percent stake in the project before pulling out in 2011. Reynolds said he also had meetings with executives and shareholders at Anglo American and Rio Tinto before the companies withdrew from the project.

The NRDC has targeted the mine’s potential funders — including Goldman Sachs, Barclays, HSBC and CitiGroup — as well, and asked them to stay away.

Collier, once a partner at the white-shoe law firm Steptoe & Johnson, said environmental groups are waging an “enormous campaign” against the project, but said the EPA is his most pressing problem.

In addition to a legal challenge against the agency, the Pebble Partnership has requested that the EPA’s Office of Inspector General investigate the agency’s actions.

Meanwhile, Republicans on the House Oversight Committee have launched their own probe, obtaining documents they say show the EPA’s intent to use the veto years before the 2014 study the agency cited in February.

Subpoenaed documents include a January 2010 EPA PowerPoint presentation listing preemptive veto as an option for the project.

The EPA official maintained that no final decision to initiate the veto process was made until January scientific assessment was complete, and described the documents as nothing more than “staff level” communications about how to respond to the proposal.

Ultimately, the official said, the fate of some 12 local tribes was a major factor.

“They’re all subsistence farmers and they rely on salmon for their lives,” the EPA official said. “For at least a decade, the whole basis of their culture and their life as been put at risk based on this mine.”

Collier points to separate studies commissioned by the partnership concluding that the majority of the salmon population would not be affected by the project. He said the EPA is standing in the way of a time-tested permitting process that would yield a decision in favor of the mine.

“We’re confident that if we can get into that process, we’re going to prevail,” he said.