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Lengthy permitting process concerns raised before congress
March 23, 2017

The burden of permitting a mining project in the United States was front and center for a U.S. House Natural Resources subcommittee as a representative of Resolution Copper told the committee that the process has created a major barrier for mining companies.

Nigel Steward, managing director of copper and diamonds for Rio Tinto, the multinational mining company developing the Resolution project, spoke to a House Natural Resources subcommittee about the permitting process.

“To date, Rio Tinto has spent over $1.3 billion on the Resolution project for permitting, studies and project shaping. The project is years away from a final permit,” Steward said. “In other countries, this project would likely be coming to the end of the permitting process.”

His remarks came during the “Oversight hearing on the importance of domestically sourced raw materials for infrastructure projects” 
at a time when demand for those materials is expected to rise, the Arizona Capitol Times reported.

U.S. Rep. Paul Gosar, R-Prescott, said in his opening statement that artificial delays caused by a bureaucratic and time-consuming permitting process for mineral extraction has led to an “unethical squandering of the nation’s resources.”

“The diversity of the nation’s mineral endowment allows for the U.S. to be self-sufficient,” said Gosar, chairman of the Energy and Mineral Resources Subcommittee, which held the hearing. “Yet domestic production of solid mineral resources is stymied by an arduous and uncertain regulatory scheme.”

“[D]elays, and more importantly uncertainties, in obtaining the necessary permits for exploration and development are driving investments away from the U.S,” Gosar said.

Steward said Rio Tinto is aware of need for regulations and that the company complies with those regulations but pointed out that Australia and Canada have similar standards but projects there are permitted within two to three years compared to seven to 10 in the United States.

He noted the delays have a real impacted and pointed to one study that said the value of the planned Rosemont copper mine, also in Arizona, fell from $18 billion to $15 billion during the years it was working through the permit process.

“The longer the wait, the more the value of the investment is eroded, even to the extent that the project ultimately becomes an unviable investment,” Steward said. “Even a large high-grade deposit will remain unmined if the balance between costs, revenue and timetable are not favorable.”

But U.S. Rep. Raul Grijalva, (D-Tucson), argued for the necessity of the regulations and asked how much of the wait for Resolution was because of a years-long campaign by the company to swap thousands of acres with the federal government for the mine – a swap that includes Oak Flat, a site the Apache claim is sacred to them. Grijalva called the 2014 land swap a sweetheart deal that he is still vowing to fight.

Grijalva said he believes the delays in permitting allow a crucial time to vet a project that is necessary to keep corporations from taking advantage of states and local communities.

 

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