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SNL investigates costs of notoriously long mine-permitting process in U.S.
Permitting delays are becoming the bane of companies endeavoring to develop mines in the United States, a country that is otherwise considered a stable and richly endowed mining jurisdiction. SNL Metals & Mining has published a report that shows a notoriously lengthy process is resulting in U. S. mines losing up to half their value before receiving final approvals for development.
“The longer the wait, the more the value of the investment is reduced, even to the extent that the project ultimately becomes an unviable investment,” the mining research firm penned in its report: “Permitting, economic value and mining in the United States.”
The National Mining Association, which commissioned the investigation, hopes the findings will supply U. S. lawmakers with the impetus to approve critical minerals legislation aimed at facilitating a timely permitting process.
“For years, we have witnessed U. S. mines’ struggle to move forward due to an inefficient permitting system plagued by duplication, uncertainty and delays.” National Mining Association President and CEO Hal Quinn said. “This study now confirms the connection between the delays and their effect on companies’ decisions to invest in domestic mining projects. Hopefully, it will strengthen the resolve of Congress to fix a broken permit system that threatens to break down a minerals supply chain that is critical for U.S. manufacturing.”
20-year Kensington permit
SNL detailed three mines – HudBay Minerals’ Rosemont copper-gold-molybdenum mine in Arizona, Coeur Mining’s Kensington gold mine in Southeast Alaska and Antofagasta’s Twin Metals copper-nickel-platinum group metal project in northeastern Minnesota – as case studies for permit delays in the United States.
Of the three, only Kensington is currently in operation – albeit, it took 20 years for permit approvals.
When Coeur Mining turned its permit applications for Kensington in 1990, the company anticipated receiving final approvals to begin developing the moderate-sized underground gold mine in 1993.
At the time, Coeur estimated it would cost US$195 million to build a mine at Kensington that could churn out about 200,000 ounces of gold per year at about US$225 per ounce.
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