This week, the U.S. Forest Service announced the approval of a land swap with the PolyMet Mining Corporation. The government will release 6,650 acres of federal land in Northern Minnesota to PolyMet in exchange for 6,690 acres of non-federal lands. Essentially, PolyMet gains access to a large contiguous section of forested land located within its mining plan while the government gets many small sections of land located closer to roads and lakes.
“The Forest Service decision further validates both the Final Environmental Impact Statement and the comprehensive process supporting this Final Record of Decision,” said Jon Cherry, PolyMet president and CEO. “This is an incredibly important milestone for PolyMet as we consolidate the surface land and mineral ownership in and around the NorthMet ore body and Erie Plant site.”
Paul Danicic, Executive Director of the Friends of the Boundary Waters Wilderness, disagreed.
“The transfer of thousands of acres of Superior National Forest land to PolyMet is a bad deal for taxpayers, premature, and not in the public interest,” said Danicic. “No exchange of land can undo the damage that PolyMet would do to this area. The land that PolyMet seeks to mine contains thousands of acres of high-value wetlands that are irreplaceable.”
Danicic said in his statement that the hundreds of years of post-mining water mitigation will cost too much and that the prospective mine has yet to show that it can meet state or federal law, or pay for what it promises.
“The land exchange is premature because PolyMet has not shown they can meet state and federal law,” said Danicic. “They have received no state or federal permit for their mine proposal. The U.S. Army Corps of Engineers has not even certified that PolyMet’s environmental review is complete. Until PolyMet proves they can meet state and federal law, there is no reason for the Forest Service to transfer thousands of acres of Superior National Forest land to PolyMet.”
Nevertheless, the pro-mining group Jobs for Minnesotans was quick to celebrate the news.
“Jobs for Minnesotans celebrates this important milestone for copper-nickel mining in Minnesota,” read a statement. “The federal Final Record of Decision for PolyMet’s land exchange validates the project’s comprehensive environmental review process culminating in the Final Environmental Impact Statement. Furthermore, this decision acknowledges that this land exchange is in the best interest of the public.”
The same for State Reps. Jason Metsa (DFL-Virginia), Rob Ecklund (DFL-International Falls) and Julie Sandstede (DFL-Hibbing) of the Iron Range legislative delegation, who wrote in a shared statement that the project has already endured thorough review.
“We are pleased to see this project take another important step forward,” read the statement. “We can’t think of another project that has been under more scientific review than this one. As always, we will keep a watchful eye to ensure science dictates the path forward for the NorthMet project.”
Either way, PolyMet is getting a good deal on this exchange. The land is critical to their entire operation. Without it, they’d have no project. Yet the state is releasing the land at a discount, something Danicic points out.
“The land exchange is a bad deal for taxpayers and the public,” said Danicic. “The land PolyMet would receive has been valued at just $550 per acre, well below its actual value as land essential to a mining proposal. The federal government will even have to pay $425,000 in cash to PolyMet. If a land exchange is to occur, it should at least fairly value the land and protect taxpayers.
At $550 an acre, you could make money grazing cattle on that land. Let’s call that Plan B.
The real challenge comes next for the Canadian development company. With its environmental review nearly finished, PolyMet begins the shorter but higher stakes permitting process. This is where legal challenges by Ojibwe bands and environmental groups could delay the project for years if PolyMet’s case isn’t rock solid.
Will PolyMet get its permits?
I think they probably will. It might take some time, but the process seems to have favored PolyMet throughout the environmental review, and I don’t see that changing.
But the even bigger question is this. Will PolyMet get its money? I-beams and trucks need currency, not resolutions of support from the Hoyt Lakes City Council.
In this, I have come to think of mining rhetoric these days as Tinkerbellian. In other words, the argument is that only if everyone in Northeastern Minnesota believes in nonferrous mining hard enough will it come to be. If it doesn’t happen, it’s because someone — perhaps a non-believing dirty hippy somewhere — didn’t snap her fingers or clap his hands. This is an old tent show revival trick designed to displace blame for broken promises. The economic truth is much more complicated and far beyond local control.
PolyMet is a junior miner, some would say a development shell. They are packaging this project for sale to an experienced mining company, most likely Glencore, the largest investor in the project so far. Glencore deals in minerals all over the world. Like all profitable mining companies, their investment models measure supply and demand — more specifically price. We know from PolyMet’s plan that Minnesota minerals cost more to mine than most places around the world. But if price is high enough, PolyMet argues, the mine here would still be a winner.
That’s a big “if.”
Let’s spot PolyMet supporters some optimism. Let’s assume we get PolyMet in the next 5-10 years. That’s a better than 50 percent likelihood, I think. So we get 200-300 permanent workers and temporary construction boom. These jobs will likely replace the 300-500 jobs lost when an Iron Range taconite mine — maybe UTac, maybe KeeTac, maybe another — permanently closes in the same time period. We’ll stew on that another decade before something else happens.
In this, bad news is just as likely as good news. Best case some of the iron mines convert to value-added iron products by then. Maybe Twin Metals, a far more ambitious and expensive proposed mine near ely, comes through, though I have my doubts about that project based on its cost. Worst case, we’re making less and less taconite for the last remaining American blast furnaces.
That might paint me as a grump, but this prediction is in keeping with the trend lines of the past 40 years. A stunning turnaround causing an enduring commodities surge would be the unusual outcome. And it would probably come with some other events we don’t want. Either trade wars that drive up the cost of living for most Americans, or real wars that kill people.
This is why I argue that we need to think differently about the economic future of Northern Minnesota. If you like mining, that’s great. We need minerals. The jobs are great. But as a region, we have to plan for a much broader future — one stunted whenever the word “jobs” is tied solely to a shaky commodities business that cares not a lick whether Iron Range towns live or die.