State is trying to set size of PolyMet’s financial guarantee. Beneath the controversy over Minnesota’s first proposed copper mine lurks a hundred-million-dollar question: How much would it cost to protect the state from water pollution, environmental calamities and mining company bankruptcies that could occur decades, even centuries, after the mine opens?
The answer could make or break the project proposed by PolyMet Mining Corp. for Minnesota’s Iron Range, and it will be front and center at the State Capitol on Tuesday, as the state’s top mining regulators testify at a hearing on how much “financial assurance” might be necessary to protect future generations of taxpayers from a new and risky type of mining. The short answer for now is: They don’t know.
If the mine goes forward, they will have to walk a perilous line. If they ask PolyMet to post too large a financial guarantee, the project may not attract the next $450 million in investment PolyMet is seeking — jeopardizing a plan that could bring hundreds of mining and construction jobs to northern Minnesota. If they ask for too little, then taxpayers someday may have to pay the price of polluting one of the most beautiful corners of the state.
“Our concern is not so much whether PolyMet is profitable or not,” said Jess Richards, director of lands and minerals for the Minnesota Department of Natural Resources, the agency that is leading the environmental review. “Our focus is to make sure that the state is protected if PolyMet were to walk away.”
It doesn’t make their job easier that the proposal has sparked passionate debate across the state and has drawn thousands of citizens to recent public hearings about the project and its environmental impact.
Company and state officials won’t predict how much financial assurance could be required, and they say it will be determined if and when state officials grant a permit for the project to proceed — late this year at the earliest.
Bruce Richardson, spokesman for PolyMet, said the company’s financial plans include those costs. “We are fully aware of our obligations there,” Richardson said. “And we are confident we can meet the state’s requirements.”
But one watchdog environmental group already has hired experts to crunch the numbers. It predicts that, because the mine might require indefinite water treatment to protect the region’s lakes and rivers, it could require guarantees of about $400 million by the time the operation closes in 20 years.
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