The U.S. Environmental Protection Agency is invoking rarely used legal powers to block permitting for the Pebble Mine, at least temporarily. Whether that action becomes permanent is yet to be determined and depends on the outcome of a formal process under wetlands provisions of the Clean Water Act.
The EPA announced the action in a press release and a press conference that included its top official, Administrator Gina McCarthy, on Friday Morning, saying it sought to "identify appropriate options to protect the world's largest sockeye salmon fishery in Bristol Bay," under part 404 (c) of the Clean Water Act.
McCarthy acknowledged that the EPA's moves are unusual.
"This 404(c) process is not something -- and I want to stress this -- that the agency does very often. But the Bristol Bay fishery is an extraordinary resource, and it's worthy of out-of the ordinary agency actions to protect it," McCarthy said in the news conference.
EPA has launched 404(c) reviews 29 times in the past and followed through with final vetoes on wetlands-fill permits only 13 times, McCarthy said.
The unique circumstances in the Pebble Mine case -- a special environment producing nearly half of the world's wild sockeye salmon, a huge and low-grade ore deposit for which commercialization would require a massive operation and possibly North America's biggest open pit mine -- justify use of the Section 404(c) process, she said.
Still, McCarthy reiterated that the existing processes currently in place under the National Environmental Policy Act are effective, and the move shouldn't be taken to mean changes are coming for how other projects in Alaska and elsewhere in the nation are permitted. "No one should read into this action any change in the mining permit processes, either contemplated or underway, in any other location. Bristol Bay is a very unique situation. This is a unique mine in a very unique place," she said.
Dennis McLarren, EPA's Pacific Northwest regional director, also said the step is rare but justified in this case. "This is authority we use sparingly for exceptional situations, and that is what we have with the Pebble deposit, which is an exceptionally large and low-grade deposit located in a very unique and sensitive spot, at the very headwaters of two rivers that are key to maintaining the exceptional Bristol bay salmon fishery," he said.
The Pebble Limited Partnership, owner company Northern Dynasty Minerals Ltd., the state of Alaska and any other entities or individuals have the opportunity to weigh in as EPA considers whether to make the permit veto permanent, McLarren said.
McCarthy said the EPA began its involvement at the request of several villages in the region, who petitioned the agency to initiate a 404 (c) process. Before doing so, the agency took steps, including compiling a report -- which was released last month -- on the mine's potential impact to the region's ecosystem. "We didn't come to this point lightly," she said.
The first step in this process, which EPA officials said they took Friday, was to notify stakeholders such as the state of Alaska, the U.S. Army Corps of Engineers and mine owners to allow them to provide more information before the agency takes further action.
Friday's specific action launches a formal review into whether EPA should use its Clean Water Act authority to preclude issuance of a wetlands-fill permit needed to construct the Pebble Mine. Such permits, issued under Section 404 of the Clean Water Act, are usually granted by the U.S. Army Corps of Engineers. But the Clean Water Act, in a provision called Section 404(c), give EPA the power to prevent such permits before they are issued by the Corps.
While EPA's formal Section 404(c) review is underway, there will be no wetlands permit issued for the Pebble Mine, according to McCarthy's announcement. The decision on whether that prohibition will be permanent depends on the outcome of the EPA review, she said.
McCarthy stressed that this was the beginning of a process, and agency restrictions aren't a foregone conclusion.
"It is not the end of the road," she said.
The news is a blow to Northern Dynasty. The company is the sole remaining member of the Pebble Partnership after mining giant Anglo American pulled out last fall, a departure that some speculated might doom the mine. On Friday, Northern Dynasty's stock, traded on the American Stock Exchange, dropped in price by nearly a third, from $1.47 to $1.
Tom Collier, the newly appointed chief executive of the Pebble Limited Partnership, said the company will continue to push for mine development. But he accused EPA of being dishonest in its process.
"We remain confident in our project and our position. We will continue to state our case with the EPA as we work through their process. The EPA's actions today are an unprecedented federal action and reflect a major overreach onto an asset of the State of Alaska. There is a prescribed science based process for evaluating projects such as Pebble and the EPA has initiated a step that turns this process on its head," he said in a statement issued by the company.
Collier said the Bristol Bay Watershed Assessment had been "biased throughout" and "unduly influenced by environmental advocacy groups." Northern Dynasty has already asked EPA's inspector general to investigate the assessment and the process that led to it, Collier said.
"As we have stated for many years, we look forward to the opportunity to present our full mine plan and have it properly evaluated under the environmental laws of Alaska and the United States. This is an important asset for the people of Alaska and the minerals in the ground at Pebble are important to our daily lives," he said.
Reactions to the announcement came swiftly from the project's opponents.
"Bristol Bay Native Corporation appreciates that EPA will identify appropriate options to protect Bristol Bay from the risks Pebble poses," Jason Metrokin, president and chief executive of Bristol Bay Native Corp., and a high-profile Pebble opponent, said. "While BBNC supports responsible development, including mining, the science has shown that the proposed Pebble mine presents unacceptable risks to Bristol Bay salmon, people and existing economies. BBNC shareholders and area residents overwhelmingly agree. We will continue to focus on ending the threat of the proposed Pebble mine and on creating other appropriate economic opportunities and jobs."
"It is difficult to overstate the significance of this announcement. If the EPA follows the science and follows through on this, it will rank as one of the most significant conservation achievements of the past 50 years," Trout Unlimited President Chris Wood said in a statement. "This is one of the few places left on earth where nature works as it should, and it's a breadbasket for the world, supplying literally hundreds of thousands of people with wild salmon."
Katherine Carscallen, sustainability director for the Bristol Bay Regional Seafood Development Association, said: "Though Bristol Bay supports a $1.5 billion commercial fishery and 14,000 jobs in total, our commercial fishermen have lived for a decade under a cloud of economic uncertainty created by the prospect of large-scale mining development in Bristol Bay. Today's announcement from the EPA shows that the clouds over Bristol Bay are beginning to move. The EPA has clearly listened to our voices, and we are pleased they are responding to the request for Clean Water Act protections we made four years ago."
Sen. Mark Begich, a Democrat who is running for reelection this year, released a statement on the decision that reiterated his opposition to the mine (which he recently announced), while simultaneously positioning himself as a watchdog against potential federal overreach, a favorite theme of his Republican opponents.
"While I am a strong supporter of responsible resource development -- including mining -- I have said the Pebble Mine is the wrong mine in the wrong place," he said in a press release. "However, I am skeptical of federal overreach from an administration that has already demonstrated it does not understand Alaska's unique needs."
State Sen. Cathy Giessel, in floor remarks Friday, used similar terminology.
"This is federal overreach on steroids," she said.
EPA's action was "outrageous" and represented "unprecedented steps to prevent a resource development project in southwest Alaska," she said.
Congressman Don Young was more blunt in his criticism of the move, saying it "show[ed] an agency corrupted by politics" and that "the EPA seeks to broaden its reach until their tentacles encumber every aspect of American life?." The action constitutes "is a serious threat to any future project" in Alaska, he said, with the potential for dire consequences. "I will be very clear, this overstep by the EPA today could mean the loss of our state to the federal government."
Sen. Lisa Murkowski, in a statement that was published on the Pebble Limited Partnership's website, blasted EPA's move, though she acknowledged what she characterized as legitimate opposition to the mine.
"I understand that many in Bristol Bay strongly oppose this potential mine. I have spoken with dozens of local residents, including a large group who traveled all the way to Washington, DC, this week to make their case. It is out of respect for their concerns, livelihoods, and culture that I have reserved judgment on the mine itself -- and made a commitment that we will not trade one resource for another. I do understand the importance and value of the fisheries resources that are an integral part of the Bristol Bay region. But even with that in mind, for the sake of sound law and policy, I have no choice but to remain strenuously and unequivocally opposed to a preemptive veto by EPA," she said in the statement.
"For the past three years, I have urged the agency not to prejudge this potential project before its developers sought permits or presented an official description of it. I have also called on the project's owners to present their plan so that Alaskans have greater certainty about its expected benefits and impacts. Both parties must respect and abide by the permitting process. Neither should be allowed to subvert or circumvent it.
"Today, however, EPA continued to move toward a premature veto based on what it assumes may happen with this project. We already have undeniably grave problems with federal agencies blocking resource production on federal lands in Alaska. Now to see a federal agency overstep its authority and move prematurely to block even the consideration of a permit for potential activity on state lands is something I simply cannot accept."
The president of a Washington, D.C.-based mining trade group also weighed in with critical remarks.
"Apparently EPA sees no limit on its powers to interfere with another federal or state agency process for permitting projects that create high-wage jobs," Hal Quinn, president of the National Mining Association, said in a statement. "Over the past several years, we've seen EPA tell other agencies to violate their rules and stop review, step in years later and revoke permits and, today, order agencies to refrain from consideration of a permit before it has been submitted. It seems that it can never be too soon or too late for EPA to interfere with projects and destroy the economic and job opportunities they bring for Americans."
Mine supporters have criticized EPA for studying the potential project before the Pebble partnership even applied for construction permits. The partnership has promised for years that the applications for permits to build the mine were imminent, but so far none have been filed. In November, Northern Dynasty's chief executive the target for submitting permit applications by the end of 2013 has been postponed indefinitely because of Anglo American's departure from the project.
Correction: An earlier version of this article misspelled Dennis McLarren's name.