Alaska News

Pebble mine backers aren't ready to give up the gold

WASHINGTON -- Purveyors of the proposed Pebble mine aren't done fighting federal, activist and state efforts to stop the massive gold and copper mine in its tracks.

This month, the Pebble Partnership will test its arguments that the Environmental Protection Agency jumped the gun in its efforts to stop the project and illegally colluded with the projects' opponents before doing so. Meanwhile, the EPA's independent inspector general is nearing completion of an investigation into the agency's process.

Now it's down to the lawyers, mining legal documents and unearthing years-old emails. Pebble CEO Tom Collier hopes a few legal wins will breathe new life into the project that many Alaskans consider down and out.

Since 2007, Pebble has spent several hundred million dollars in efforts to move forward on its mineral claims about 200 miles southwest of Anchorage, according to financial statements. Between 1988 and 2013, Pebble drilled 1,355 holes in the ground to test what lies beneath, and found gold, copper and molybdenum worth hundreds of billions of dollars.

Under pressure from activists, the fishing industry and others, EPA began conducting a scientific assessment of the Bristol Bay watershed in 2010 to determine what problems a mine like Pebble could cause for downstream salmon fisheries and the environment. Last year, the federal government decided the mine would be a big problem and began a regulatory process that would limit Pebble's options for a necessary federal permit.

The agency's findings suggested that "the porphyry copper mining of the scale contemplated at the Pebble deposit would result in significant and unacceptable adverse effects to important fishery areas in the watershed," EPA said in a 2014 letter to Collier, the Alaska Department of Natural Resources and the Army Corps of Engineers.

Major funders Anglo American and Rio Tinto have dropped the project amid mounting opposition, and this year, Pebble's budget is only about $15 million.


The lion's share of it is going to fighting the EPA.

So far, on the Pebble front, "2015 has been deceptively quiet," Natural Resources Defense Council senior policy analyst Taryn Kiekow Heimer wrote in a blog post this week. In reality, the legal fight is "intensifying," and bills to revoke the EPA's authority have been introduced in Washington, Kiekow Heimer said.

On May 14, the mine's owners will take another stab, in federal court in Anchorage, at arguing that the EPA can't legally issue a preemptive "veto" of the project. The best odds for Pebble aren't in the Ninth Circuit Court of Appeals -- a lower court tossed the request last year, saying it couldn't rule on the issue since EPA hasn't made a final decision. Court precedent on "final" EPA rulemakings is long, and appeals court judges are usually wary of making new precedent.

Nevertheless, the case is a who's-who of the battle over Pebble mine, pitting the Pebble Limited Partnership and the Alaska Peninsula Corp. against the EPA and groups like the Natural Resources Defense Council, the Bristol Bay Native Corp., Trout Unlimited, the United Tribes of Bristol Bay, and Nunamta Aulukestai, a 10-tribe group formed in 2007 largely to fight the mine.

Later in the month, Pebble's lawyers will move forward in another court on another legal angle, one with which they've had more success so far.

There, the history of interactions between EPA and groups like Nunamta Aulukestai, NRDC and a slew of outside scientists and lawyers will come into play. Pebble says the EPA's chummy relationship with the mine's opponents, particularly in crafting the Bristol Bay Watershed Assessment, was illegal, a one-sided power play.

"[E]vidence exists that the EPA may have been considering a Section 404(c) veto of the Pebble Project at least as far back as 2008 – two years before it received a petition from several Alaska Native tribes," Pebble's remaining funding source, mining company Northern Dynasty, wrote in Canadian financial filings in February.

EPA argued in court that it simply hired outside contractors and came to the aid of citizens who asked -- nothing out of the ordinary.

In late 2014, Alaska District Court Judge H. Russel Holland saw some reason in Pebble's arguments and granted an injunction to stop EPA work until the case plays out in court. Holland said Pebble has "a fair chance of success" on one claim that the EPA violated the 1972 Federal Advisory Committee Act and said the analysis "strongly suggests that there is going to be a recommendation to veto the Pebble mine project."

On May 28, the court will hear arguments over EPA's motion to have the case tossed entirely. If Pebble prevails and the case moves forward, the next stop has the lawyers excited: discovery.

That means Pebble gets to go after personal emails, conduct scores of interviews and dig through every bit of EPA's and its contractors' processes. If they win the case, the EPA could not use any of the work produced by what Pebble argues is a "de facto" federal advisory committee. That means no watershed assessment, and likely no preemptive veto.

After this month's court arguments, decisions are expected in the following months that could illuminate Pebble's next steps.

Dennis McLerran, EPA's Region 10 chief, said he is "confident we will ultimately prevail in that litigation" and that the agency "stands behind its work completed to date on Bristol Bay."

Also expected this summer: the results of an ongoing investigation by EPA's own cop on the beat, the Inspector General's office, which began investigating EPA's Bristol Bay efforts after complaints from lawmakers and others. (Northern Dynasty sent eight letters to the Inspector General complaining of "bias, process irregularities and undue influence by environmental organizations," according a recent financial filing.)

The investigators are trying to find out whether the assessment was conducted "in a biased manner or whether it had a pre-determined outcome" and if the agency followed proper scientific and legal procedures, Inspector General Arthur Elkins Jr. testified before the Senate on April 14.

So far, investigators "have reviewed extensive documents, thousands of email records and other correspondence, and interviewed numerous current and former federal employees and state employees, tribal representatives, the Pebble Limited Partnership's chief executive officer, and peer reviewers," Elkins said.

Just what impact the report might have -- or what it might say -- is up in the air.


Pebble isn't letting things lie with investigations by the Inspector General and concerned congressmen: It has initiated its own independent review of the EPA's actions through the Cohen Group in Washington, D.C.

The EPA, it would seem, has had enough. Citing "three separate lawsuits initiated by Pebble" -- there is a third lawsuit over the results of a Freedom of Information Act request -- along with House and Senate investigations and the Inspector General's review, the Justice Department's Assistant Attorney General John Cruden told William S. Cohen of the Cohen Group to back off.

The "United States will not cooperate with your private evaluation, and we respectfully urge you and your client to desist in this effort," Cruden wrote in an April 23 letter provided to Alaska Dispatch News.

But even if it all goes the way of the mine, the Pebble Partnership needs more cash before it can file for the more than 60 permits needed to start digging for gold.

Right now, Pebble is trying to talk a major-league mining company into backing the project -- any one will do. Collier said he could not reveal who the company is talking with but that there are several potential "partners."

Eventually -- perhaps years down the road -- the company hopes to apply for a federal "404" permit and get an environmental impact statement crafted by the U.S. Army Corps of Engineers -- "not one that has been ginned up by our opponents," Collier said.

He asserted that contrary to what EPA, environmentalists, the fishing industry and others say, Pebble mine is "not a risky venture." That's not geologically possible, Collier said. The mine would touch on only two of nine river systems that feed into Bristol Bay, and which provide 10 percent of the area's salmon. He argues that 10 percent wouldn't be harmed. Pebble has promised state-of-the art containment systems, doubly backed-up dam systems and a comfortable co-existence with Native tribes and the fishing industry.

Pebble and its supporters have said that the EPA's assessment is "biased" and the agency "used junk science," but "we hotly dispute all of that," said EPA's Justice Department attorney Brad Rosenberg in court in November. The agency has said the mine would put a pit almost as deep as the Grand Canyon in the middle of an important ecological and economic area for the salmon industry.


Collier says Pebble just wants the chance to share its plan in due course.

But opponents don't want to wait. Some have pointed to a massive dam failure in August at the Mount Polley gold and copper mine in British Columbia. Contamination remains in the nearby Quesnel River, according to a recent report by the Vancouver Sun. Now, some Canadian Natives are fighting reopening of the mine, the Vancouver Observer reported Wednesday.

Erica Martinson

Erica Martinson is Alaska Dispatch News' Washington, DC reporter, and she covers the legislation, regulation and litigation that impact the Last Frontier.  Erica came to ADN after years as a reporter covering energy at POLITICO. Before that, she covered environmental policy at a DC trade publication and worked at several New York dailies.