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Hard-Rock Mining Final

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Economics 471

HARD-ROCK MINING
Abstract
An economic examination of the historic, yet still applicable mining laws and
regulations pertaining to hard-rock mining practices. The specific environmental
and social implications of hard-rock mining techniques will be studied. Closing
with the solutions to the economic externalities and the relevance of general
policies to the modernized mining industry.

Winter, Stefinie L
Economics 471

Introduction
Historically, mining began in the United States before the War of 1812, utilizing a
large scale of individuals and thereby creating jobs and aiding in incentivizing the
economic growth of society. However, after the beginning of The Gold Rush, the
individual level of mining morphed into a corporate phenomenon. This transformation
led to the development of new technology and mining techniques, giving birth to the
General Mining Laws and Regulations in the United States. These laws and regulations
began with the General Mining Law of 1872; however, their primary goals have
drastically changed as the outcome of mining proved to be more valuable. As recognition
spread of the monetary values that accompanied the mining of earth elements, the
General Mining Act of 1872 grew increasingly outdated and loopholes developed. The
over-arching goal of this paper is to address, discuss, and argue why todays mining laws
are outdated by illustrating the damages that have already been done due to their lack of
updating.
Mining Brief
The history of surface mining began in Wisconsin during the 1820s, and rapidly
developed popularity as started to spread northwest into Illinois, eventually reaching out
into the west (Wisconsin-Mines). Generally, surface mining is defined as a mining
technique that exposes the mineral deposits by the removal of topsoil and any
overburden, which can ranges from rocks and soil to entire ecosystems. This technique
can be divided into categories: open-pit, strip, and mountaintop removal. During open-pit
mining, a cut, which later forms a quarry, is made at the grounds surface in preparation
for the removal of valuable mineral(s) or ore(s). In both open-pit and strip-mining

commercially valuable deposits are located near where the overburden is thinnest. Unlike
open-pit, strip mining is done by the creation of repeating long narrow bands (Great
Mining, n.d.). While each of these are environmentally invasive, they are trumped by
mountaintop removal. Used to replace most underground mining retrieval methods, the
mountaintop removal process begins by destroying the forest; then powerful explosives
are applied to remove up to 800 feet of mountain rock; finally, draglines are used to dig
into any remaining rock to reach the valuable deposits that are closer to the surface
(Dawson et al., 2015).
The placer mining is a special method created to reach alluvial deposits of
valuable minerals; usually located in a stream-bed or floodplain (Humphries & Vincent,
2001). Originally, placer mining involved miners taking a shovel to the stream bed
sediment or floodplain and sifting the sediment in a sluice box. This type of mining has
evolved to encompass technological machinery advances, (Butterman & Amey, 2005).
Despite these advances the laws for placer mining have not been updated.
Further building on this the General Mining Act of 1872 was also not expanded to
cover the mining of precious metals or stones and hard-rock minerals. These hard-rock
minerals are commonly mined through methods known as underground mining. The
methods of underground mining are otherwise referred to as lode mining, which is any
non-placer mine. Underground mining is applied when hard-rock minerals and precious
metals or stones are located far beneath earths surface. Accessing the valuable ore,
involves a decline with the aid of a box cut, portal (entrance) back to the surface. Then
shafts are placed vertical and suck adjacent to the ore; then one of the three ventilation
systems will be installed (Great Mining, n.d.).

Mining Policies
Introductory Thoughts
143 years ago President Grant enacted the General Mining Law of 1872, which
set the price claim of hard-rock mining land between 2.50 and 5 dollars per acre with
many of its contents still governing hard-rock mining today (Earthworks, 2015). The
General Mining Law of 1872 also allows both foreign and domestic companies to take
valuable hard-rock minerals from the land without paying any royalties. This law
contains no environmental provisions, which ultimately allowed the hard-rock mining
industry to consistently introduce havoc on water supplies, wildlife, and landscapes
without consequences (Earthworks, 2015). According to the Environmental Protection
Agency, it is responsible for 40 percent of the pollution found in Western watersheds.
While in the political realm, it is considered to be one of the last remaining dinosaurs
when it comes to public land giveaways. As mining progressed, the Mineral Leasing Act
of 1920 was formed, which placed new regulations on oil, natural gas, oil shale,
phosphate, and sodium resources.
However, after Rachel Carson introduced the first wave of eco-criticism with the
publication of Silent Spring in 1932, an era of environmental progress began of which
President Nixon aided in developing. This resulted in the development of the
Environmental Protection Agency in 1970, National Environmental Policy Act of 1970,
Clean Water Act of 1972, Resource Conservation & Recovery Act of 1976 (RECRA),
Federal Land Policy & Management Act of 1976, as well as the Comprehensive
Environmental Response, Compensation, and Liability Act (CERCLA) of 1980 have all
aided in correcting some of the hard-rock mining implications.

Clean Water Act


During the past 43 years, the Clean Water Act has gradually evolved from
addressing single point sources of pollution to complex or multiple point sources of toxic
pollution (CWA Section 402). In 1987, this act was amended to further accommodate for
the establishment of water quality standards for toxic pollutants. These amendments in
turn, gave way for a basis to control discharge sources in hard-rock mines. Additionally,
Section 404 of the Clean Water Act, which pertains to the permitting of dredging and
filling, implemented a set of 40 initiatives to protect valuable wetlands (EPA, 1997).
However, this act does not protect groundwater sources from hard-rock mining practices
and it does not clearly define how a mine should be reclaimed (Earthworks, 2015).
Comprehensive Environmental Response, Compensation, and Liability Act
Over the past decade, the Comprehensive Environmental Response,
Compensation, and Liability Act or CERCLA, is known as the superfund program, which
is utilized to respond to environmental threats in the hard-rock mining industry as well as
any processing sites. Any site that falls into this superfund program, has posed a
substantial threat to human health and/or the environment. Recently, federal agencies
have been given permission to utilize CERCLA to enforce clean-up initiatives on their
land (EPA, 1997).
Resource Conservation and Recovery Act
In the realm of rulemaking, Resource Conservation and Recovery Act has been
designed to classify mining waste streams, which should be regulated as hazardous
waste. Congress amended RECRA in 1980 to include the Bevill exclusion for solid

waste from extraction, beneficiation, and processing of ores and minerals, which
ultimately excluded waste associated with hard-rock mining from being regulated. After
most of the hard-rock mining had been precluded, the EPA attempted to re-enforce
regulations for hard-rock waste; this re-enforcement proposal was never acted upon.
However, it did aid in providing a basis for regulations on a state level (EPA, 1997).
National Environmental Policy Act
The National Environmental Policy Act, also referred to as NEPA, requires
federal agencies to formulate environmental impact statements (EIS) for actions that
would affect the features of the human environment on a severe level. Additionally, any
activities pertaining to hard-rock mining on lands (federal managed or tribal) may require
an EIS be conducted to identify and determine the severity of potential impacts (EPA,
1997).
Concluding Thoughts
Albeit, the wave of eco-criticism brought about by Carsons Silent Spring,
introduced a variety of federal regulations meant to provide both human and
environmental protections, all of which have advanced over time to include loopholes,
which do not necessarily adhere to the growth of the hard-rock mining operations.
Alternatively, these acts have unveiled streams of potential threats to both human health
and the environment. The EPA estimates there are over 200,000 abandoned hard-rock
mines but only around 156 falls under their jurisdiction (EPA, 2004). Meaning that,
approximately, there are 199,844 hard-rock mines that the above acts cannot be applied.
Moreover, if the EPA were to recover all the sites that are currently under their
jurisdiction, it would cost them $15 to $50 billion to complete. Consequently, the absence
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of regulations have led to many implications pertaining to sensitive lands, polluted water
sources, fish and wildlife, and natural lands. Since 2007, various editions of a Hard-rock
Mining and Reclamation Act has been displayed through Congress. However, every
proposal: 2007, 2009, 2014, and 2015, has died either in committee or at the end of the
Congressional season. The passing of this proposed act would have enabled the federal
government to remove the patenting, creating royalty for both new mines and existing
ones, and aid in the finances of cleaning up abandoned sites (Earthworks, 2015).
Essentially, overpowering that of the General Mining Law of 1972 influence on hardrock mining practices.
Implications & Externalities of Mining Techniques
Success Stories
Yellowstone National Park, was the first site to be declared a national park, and
has successfully created job availability and brought in millions of tourism dollars to both
Wyoming and Montana. The northeast corner of the park is lined with portions of the
New World Mining District, which historically contained a majority of hard-rock mines
along Henderson Mountain in Montana. Prior to the districts closure, the mining
companies manufactured well over $215,000 in hard-rock minerals, ranking them the
third largest producer of precious metals in Montana (Montana.gov, 2009). By 1996, this
was one of the first many success stories for both past and present generations. The Trust
for Public Land and the U.S. Forest Service worked jointly to purchase the mineral rights
outside of Yellowstone, as major concern had developed over both old and new hard-rock
waste potentially being sent into the park via Soda Butte Creek. This waste would have
cost the park millions of dollars in tourist revenue, as a result of any lost activities and

posed multiple threats to the landscapes and ecosystems of the


park. In fact, the United Nations commented that Yellowstone
could have been placed on the list of In Danger within the
World Heritage Sites. As a result an agreement, or rather a
federal buyout transpired, costing the government over $65
million and the mining companies $25 million in reclamation
efforts (Repanshek, 2010). Although this agreement stopped the
most detrimental impacts of hard-rock mining waste from

Figure 1: Shows the remains of one


of the mines in Gallatin National
Forest, Montana.

entering the park, figure 1, provides evidence that there are still abandoned mines that sit
crumbling approximately 3 miles from the park.
Since its discovery in 1876 by Frederick and Moses Manuel, the Homestake Gold
Mine has produced over 40 million ounces of gold and is considered to be the largest
iron-formation-hosted gold deposit in the world. After it was sold as an open-pit by the
Manuel Brothers for $30,000, further deposits
were discovered via underground methods,
raising the price to 20 times the original
selling price. Until its closure in 2002, the
Homestake Gold Mine was not only the
largest, but also the deepest gold mine in
Figure 2: Shows the Homestake Gold Mine,
which is located in Lead, South Dakota.

North America. Throughout its lifespan it

produced roughly 300,000 ounces of gold per year (Lufkin, 2009). However, figure 2,
hardly begins to showcase the amount of ecosystem that was demolished to locate further
deposits and expand the mine.

Disaster Stories
Even though there have been a few success stories, there have been far greater
implications as the hard-rock mining sector has grown, the detrimental implications of
mining techniques have become increasingly more apparent. These implications extend
to have impacts on not just the environment, but also major consequences on human
health. Predominantly, both active and abandoned mines disrupt the immediate area at
which they dominate. However, they also create paramount impacts on air and water
quality, vegetation, aquatic and wildlife species, soil, as well as cultural resources. These
impacts extend beyond the immediate area of disturbance (Committee on Hardrock
Mining on Federal Lands, 1999). Since there are multiple stages in each mining
technique, both environmental and human impacts could arise at any time during or after
the technique is completed.
Presently, hard-rock mining has left more than 10,000 miles of polluted
streams, contaminated lakes, mountains reduced to craters and landscapes devoid of
life where thriving forest and fragile deserts once existed (Boulanger & Gorman,
2004). The policies addressed in the section entitled, Mining Laws, all attempted to
avoid, limit, control, or offset many of these potential impacts, but mining will, to
some degree, always alter landscapes and environmental resources (Committee on
Hardrock Mining on Federal Lands, 1999). Although the Clean Water Act has been
adapted to include more complex sources of toxic pollution, it does not protect
groundwater sources from the implications of hard-rock mining practices. Moreover, the
Bevill loophole added to the Resource Conservation and Recovery Act in 1980, allotted
for the exclusion of hard-rock waste to be unregulated. Therefore, allowing for the
release of toxic chemicals, such as cyanide and sulfuric acid, to reach water supply
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sources and led to the development of air pollution. The hard-rock minerals themselves
contain toxic metals, like lead, and have the ability to threaten human health through the
release of radioactive gases, arsenic, and mercury. Environmental and human health
dangers in hard-rock mining can also develop from human error, such as poorly
engineered mountains and collection of waste (Boulanger & Gorman, 2004).
While further environmental and human health dangers harbor upstream, there are
implications already rushing into externalities downstream. Here, if mercury can be
found in large quantities, it can be cause kidney, nervous system effects, and permanent
brain damage. Whereas, in low quantities, an individual might develop a lower IQ,
slowed development, and memory and language barriers. In 2001, the hard-rock mining
industry released 4.3 million pounds into the air, water, and soil. These should be
relatively clean and available for a basic human right. However, instead they are being
contaminated by industries, such as hard-rock mining, and are being a tragedy of the
commons. Additionally, mercury pollution can be ingested into the tissues of fish and
wildlife, becoming part of the bio-magnification cycle, which allows mercury to be
passed up the food chain. This eventually impacted the fish consumptions, as by 2002
state public health agencies issued 2,148 advisories (Boulanger & Gorman, 2004).
Acid mine drainage is a major concern in Montana, where there are 20,000
inactive and abandoned mine sites, which amounted to 1,118 miles of stream damage.
This process is mostly common in underground mining, as it occurs as groundwater flows
through mine channels, or as rain water percolating through waste rock, leach and tailing
ponds (Boulanger & Gorman, 2004). Although acid mine drainage as resulted in elevated
levels of chemicals in downstream water and sediment, it has not been studied

comprehensively for human health implications. However, the environmental pollution


associated with acid mine drainage have proven to be extensive through massive fish
decline and cattle losses after water consumption. Moreover, cyanide pollution is often
associated with acid mine drainage, as it is able to bio-accumulate and produce both dust
as well as air pollution. In regards to these cyanide spills though, the hard-rock mining
industry insists that none of their workers have been killed after working with the highly
toxic cyanide. However, on a global scale, there have been tailing dam failures causing
extensive fish depletion and spills from gold mines have hospitalized hundreds of
individuals (Boulanger & Gorman, 2004).
If placer mining occurs in active streams, the sediment along the stream-bed
would be disrupted, which ultimately would result in high turbidity. Recovery of the
stream-bed and its inhabitants may return to its original characteristics unless its
disturbed during a year with low-precipitation. However, even if it returns to its original
characteristics, it may continue to be incompatible for aquatic creatures until the turbidity
returns to a lower level (Committee on Hardrock Mining on Federal Lands, 1999).
Furthermore, the last major human health externality that hard-rock mining
produces as a whole is the threats to drinking water. Clean and safe drinking water is
known to be the one irreplaceable natural resource required for life. The threat from hardrock mining is deeply-rooted in the multiple opportunities for waste to imprint itself into
the ecosystem cycles and, in turn, human life. According to Boulanger and Gorman, the
Environmental Working Group identified 374 watersheds in the United States that are
utilized for drinking water and impaired or threated by metal pollution. There is an

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opportunity to improve and learn from lessons of the past, but society as a whole needs to
decide to move towards the implementations of solutions.
Solutions
Even though, mining still exists and is responsible for 15 percent of the United States
GDP, society can decide to make a move towards utilizing more alternatives pertaining to
renewable energy (Central Intelligence Agency, 2014). Another suggested solution is to
place the mineral rights under the umbrella of home property rights. Through applying
this umbrella, the owner of the land wouldnt be subjected to the right of way. This
decision, in turn, presents less negative externalities.
You may own your house, but someone else owns everything
underneath it.
-

J. Paul Getty

Further options would be to expand the mining policies and regulations to adequately
allow for coverage of the growth of peripheral operations, some of which were addressed
in the energy section, doing this would present the opportunity to target the externalities
themselves. Generally, applying hard-rock mining industry specific regulations to
incorporate agencies to establish risks to the fullest, monitor pollutants, release
information regarding environmental and health risks, but most importantly, lock-in an
industry specific mine recovery fund.
Conclusion
Gradually, the individual level of mining transformed into a corporate
phenomenon that today contributes 2.5155 trillion dollars to the United States economy.

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However, hard-rock mining has introduced various and detrimental environmental and
human health implications. These implications attached to valuable minerals are still
amongst the most loosely regulated minable resource in the United States. The primary
goals of regulation pertaining to hard-rock mining should be adapted to incorporate the
environmental and human health damages, for both past and present sites.
Many millions of dollars have been invested by the [hard-rock]
mining industry into the science of how to extract even smaller
concentrations of gold from rock, but very little has gone into
determining how to put the earth back together once it has been
blasted, crushed, and saturated with chemicals
-

Boulanger and Gorman

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Work Cited
Boulanger, A., & Gorman, A. (2004). Hardrock Mining: Risks to Community
Health. Bozeman, MT: Womens Voices for the Earth (available online at www.
earthworksaction. org/pubs/MiningHealthReport. pdf).
Butterman, W. C., & Amey, E. B. (2005). Mineral Commodity Profiles: Gold. US
Geological Survey.
Carter, B. (2012). Boom, bust, boom: a story about copper, the metal that runs the
world. 1st Scribner hardcover ed. New York: Scribner.
Central Intelligence Agency. (2014, June 5). Retrieved March 10, 2015, from
https://www.cia.gov/library/publications/the-world-factbook/
Committee on Hardrock Mining on Federal Lands. (1999). Hardrock Mining on
Federal Lands. Retrieved from National Research Council website:
http://www.nap.edu/catalog/9682.html
Dawson, R., Winters, P., & Matson, J. (2015). Mountain top removal. Uhuru,
10(3), 12.
Earthworks. (2015, February 13). Earthworks. Retrieved from
www.earthworksaction.org/library/detail/hardrock_mining_reform_and_reclamation_act
_of_2015
Environmental Protection Agency: Office of Inspector
General. (2004). Nationwide Identification of Hardrock Mining Sites. (2004-P-00005),
from http://www.epa.gov/oig
Environmental Protection Agency. (1997). EPA's National Hardrock Mining
Framework. 1-12. Retrieved from http://www.epa.gov/aml/policy/hardrock.pdf
Lufkin, J., Redden, J., Lisenbee, A., & Loomis, T. (2009). Guidebook to Geology
of the Black Hills, South Dakota. Golden, CO: Golden.
Mining Techniques| Mining Methods. (n.d.). Retrieved March 20, 2015. Retrieved
from http://www.greatmining.com/strip-mining.html
Montana Department of Environmental Quality (DEQ) - 154tech. (2009,
November 6). Retrieved March 11, 2015, from
http://www.deq.mt.gov/abandonedmines/linkdocs/154tech.mcpx

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Humphries, M., & Vincent, C. H. (2001). Mining on Federal Lands.


Congressional Research Service, Library of Congress.
Repanshek, K. (2010, June 15). Land Deal Closes The Book On the New World
Mine Proposed on Yellowstone National Park's Doorstep. Retrieved March 11, 2015.
Retrieved from http://www.nationalparkstraveler.com/2010/06/land-deal-closes-booknew-world-mine-proposed-yellowstone-national-parks-doorstep6045
Wisconsin-Mines. (n.d.). Retrieved March 20, 2015, from
http://www.miningartifacts.org/Wisconsin-Mines.html

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