PolyMet seeks to use the old LTV Steel processing plant, formerly the Erie mine, near Hoyt Lakes for use as a copper-nickel mine processing facility. (PHOTO: Joel Dinda, Flickr CC)
Today the U.S. Army Corps of Engineers issued the last required federal permit for PolyMet’s proposed copper-nickel mine near Hoyt Lakes, Minnesota. With this permit, the company now enters the next phase of its development: proving that it has the capital and ability to execute its mine plan.
Local news and Northern Minnesota social media circles brim with the same arguments, talking points, fears and hopes that have come to define this project. For more than ten years, a proposal by a junior mining firm — the kind that come and go constantly all over the world — has utterly dominated the political landscape of our region.
If PolyMet was a basket, Iron Range local leadership would have tucked so many eggs in there that they’d be falling out onto the pavement. And they’d still be trying to cram in more eggs. People would be running for office on the slogan of putting more eggs into the already full basket. And they would be winning. Other empty baskets would be kicked aside or even burned for the audacity of being a competing receptacle.
That’s not to dismiss the possibility that a mine could open. Nor to downplay either the risks or rewards of such an enterprise. It’s only my continued strident yet unfulfilling refrain that it’s highly unlikely, for economic and technological reasons, that PolyMet will reshape the future of the Iron Range to the degree most of its supporters believe it will. If at all.
But today does reflect at least one turning point. PolyMet has its permits. That means that the reality of the situation may come into focus. Is global metals giant Glencore going to sweep in and take over? Or another company? Will there be more dithering over investors and off-take agreements, the way we’ve seen the Essar Steel Nashwauk iron ore project languish lo these many years?
The issuance of permits was never in much doubt. For political and procedural reasons, those were always going to appear. But is the project really, truly viable? That’s what we’re going to find out. Many hope we learn it soon, but we may well learn it slow.
Reminds me of folks who live in God established fish-rich areas, “livelihood dependent on fish” areas….say like the coast of Maine, but then fight against fishing. I’ve always wondered why they don’t move to Iowa, where fighting against fishing is “meh”. But…would they then fight against raising corn? If not corn, hogs? Hmmm…I wonder.
What??
The question that Aaron notes is on the table is “in market conditions for copper and nickel that have led another very large copper mining company to delay development for their Northeastern MN mining claim and await possible higher prices , will Glencore or some other potential cash cow put up the hundreds of millions needed to open the Polymet mine? And if so, will they actually run the mine while market prices are below or very near the costs of production?
This has nothing to do with opposition to the mine, or with fishing in Maine, but rather with current financial conditions in the mining industry.
The big problem is that plans for non-ferrous mining in Northeastern MN were made when copper was consistently above $3, and often in the $3.50 to nearly $4 range. Prices recently are in the $2.70 to $2.90 range, and in 2019 are trending down. As a friend of mine who is a mining professional says, if Polymet were open today, it would be closed.
BTW, the livelihood of the coast of Maine is dependent on tourism, its number one industry. Commercial fishing is fifth to health care, retail, and construction, and that only if lobstering is considered fishing.
Fake news Gerald..
Guess the several announcements by Antofagasta about their decision to delay development in NE Minnesota pending significant rises in copper and nickel prices and the daily quotes (and yearly graphs) on the price of copper slipped by you. Unless “fake news” actually means “facts that negate my biases and I wish were not true, so I am going to pretend don’t exist.”
Either way, the world — and in this particular case, the copper mining industry — continues to operate and make its decisions without you.
Regardless of your personal, private ideas, the question of whether Polymet and non-ferrous mining turns out to be a new god-send for the Range or just another in the long line of projects that both citizens and politicians have gotten all excited about only to see them collapse is a valid one. Aaron’s analogy with the Essar Project is one that should make all of us nervous.
We agree Gerald, citizens SHOULD get excited about government/politicians sticking their nose in making business decisions. Their track record with individual projects, like Solyndra, GreenVolts, Excelsior Energy, Giants Ridge, Lakewood Industries (Rudy’s chopsticks), Meyer Associates (Dollars for Democrats), Friends of Sax-Zim bog, etc., is horrendous. The list goes on. It’s all about buying votes, nothing to do with developing a sustainable business.
And this doesn’t even address governments taking over total economies like North Korea, Venezuela, East Germany, Cuba, etc. That list unfortunately goes on an on as well. And that track is even more disastrous. Not one success in human history.
So…there’s certainly nothing guaranteeing business minded people, private investors, always make the right decisions. But, we’re all better off, far better off, letting business people make those decisions with their money, not ours.
To once again return to Aaron’s topic from the ongoing flight of ideas introduced, the question at hand is: with copper prices where they are at and where they seem likely to be, will sources of money put up the huge amount of cash needed to build the Polymet project, and if so, how much will Polymet be able to operate in the price environment that exists now and in the foreseeable future, as opposed to the much higher prices that existed back when the project was conceived?
BTW Gerald – I said Coastal Maine, coastal. “Coastal”…not unlike the “Iron Range” is to Minnesota’s economy. Fishing might not mean much to those bureaucrats in Augusta, just like mining doesn’t mean much to those in St. Paul…or the minority non-miners, anti-miners on the Range. But ask those who live in Stonington or Keewatin respectively.
MARCH 4, 2019
“Maine’s commercial fishing industries remain a critically important driver for our state’s economy and identity,” said Department of Marine Resources Commissioner Patrick Keliher.
“This industry is the cornerstone of Maine’s coastal economy, and the value of the 2018 catch reflects the dedication and sacrifices of the men and women who work on the water and those who make sure this quality product gets to market,” Gov. Janet Mills said.
Underscoring the importance of commercial fishing to Maine is the most recent data from the Atlantic Coastal Cooperative Statistics Program, which reveals that Maine commercial harvesters took more than twice the number of commercial fishing trips than any state on the East Coast.
In 2018, Maine harvesters reported 447,523 trips, while harvesters from Virginia, the next highest state, reported just 217,940. Maine’s commercial fishing includes sea irchins, softshelled clams, herring, scallops, elvers and of course…lobster.
Overall, the value of Maine’s 2018 commercially harvested marine resources was the third highest in history.
U.S. Sen. Angus King, I-Maine, commends the work of the men and women in Maine’s fishing industry, “whose hard work drives the economy and helps support families and communities up and down the coast.”
What you are talking about is a bunch of politicians trying to attach themselves to a tradition that is part of New England history. The similar thing out here is endless prattle about “family farms,” something that was significant when you and I were young but is virtually nonexistent now, except in beloved mythology.
The information I cited was from the FRED data from the Federal Reserve. Fishing follows tourism, healthcare, retailing, and construction in its contribution to the GDP of the Maine coastal counties. If you include all of Maine, it falls another two notches, behind forest products and manufacturing. Fishing is not insignificant, but is less important than it was back in 1924.
All this is of course totally irrelevant to the issue of the financial viability of Polymet. What is not irrelevant is the principle of basing ideas on data, not legends, Ranger, no matter how appealing the legends are.
You appear unaware Gerald, so let me help out. The Kaye E. Barker left Duluth harbor for Two Harbors to load iron ore this past Friday. It’ll the first of more than 900 ships that’ll leave Duluth this year. That’s not only legendary, but very real.
Just as the 447,523 fishing boats that left Maine’s harbors last year were also very legendary, and also very real. As you say Gerald, let’s use data. Oh…and legendary and real are not mutually exclusive.
The point is not that fishing is not legendary, or iron mining. The point is that, contrary to your statements, the “livelihood” of coastal Maine is not dependent on fishing. It is dependent on tourism. Full stop. Fishing is a fun thing to think about, but only ranks fifth in economic importance. Also, I doubt that anyone is opposed to Maine commercial fishing. There has been some opposition to and regulation of the rates of extraction of the resource, and even the lobstermen now concede that the strict limits that were enforced a couple of decades ago are responsible for the recovery of Maine lobstering to a state of abundance from what was at the time near destruction of the resource.
BTW, 447,523 fishing boats did not leave Maine’s harbors last year. An indeterminate, but much smaller, number of boats left Maine’s harbors on 447,523 trips. Many of the trips — lobstering, and so on — would have had a single boat making two trips a day to check their trap lines. Some others headed out to the Georges Banks and Grand Banks for trips lasting a week or more.
Still waiting for you to return to topic — world copper prices and the future of non-ferrous mining in NE Minnesota — of what Aaron was talking about.
You’ve resorted to a classic leftist tactic Gerald..sounding like pencil neck Schiff and the MSM. Repeat a false statement enough times and people might start to believe it. In days gone by, it worked…occasionally. Those days are gone..
This has gotten too silly once again. Apparently you believe that the Federal Reserve is lying about the economy of Maine. But more to the point, you somehow seem to believe that commercial fishing in Maine has some impact on the price of copper and the viability of non-ferrous mining in Northeastern Minnesota.
Aaron’s article might obtusely imply he’s concerned about the price of copper, but he’s very directly complaining that Polymet is “burning other baskets”. What other investments (baskets) is he referring to the aren’t being filled? And if so, it’s somehow Polymet’s fault??
Why say – “If PolyMet was a basket, Iron Range local leadership would have tucked so many eggs in there that they’d be falling out onto the pavement. And they’d still be trying to cram in more eggs. People would be running for office on the slogan of putting more eggs into the already full basket. And they would be winning. Other empty baskets would be kicked aside or even burned for the audacity of being a competing receptacle”.
Why not articulate what baskets are empty? Why not describe the benefits of these mysterious empty baskets vs. badmouth Polymet? He leaves no choice but to conclude 1) those baskets don’t exist…and 2) he really dislikes Polymet. Oh…and he never once mentions the price of copper.
You can’t be seriously suggesting that copper prices have nothing to do with Aaron’s point.
Aaron is just warning the people who are out celebrating the final permits being granted that we still have a long way to go before Polymet becomes reality, and now we are not dealing anymore with organizations that can be pressured by politicians here and in Washington, but instead with the unforgiving and unstoppable forces of the world market.
His main point is the potential difficulty that Polymet might encounter in finding the huge major investors it needs in raising the hundreds of millions needed to create the mine and processing plant. As anyone who knows anything about the copper industry or has read Antofagasta’s statements about their own Minnesota project, the main potential obstruction is the decline in the price of copper. If copper were selling for $3.75 a pound, there would be a line of people wanting to invest. At $2.85, not so much, and that seems to be the much more likely scenario for now. The fact that Antofagasta, which knows everything there is to know about copper markets, believes that a Northeastern MN mine is not a good investment at this time is particularly disquieting.
This is the point of Aaron’s article. His comments about baskets are just expressing frustration with the recurring questionable judgement of Rangers and their politicians, planners, and industry figures in perhaps once again getting carried away in pinning so much hope on a tenuous situation. You yourself seconded that point in a comment above, although your comments on Polymet seem to suggest that your feeling on that is “this time for sure.” Best of luck in that, and only time will tell.
Again…what baskets (investments) are being ignored, burned, because of Polymet? Shine some light on those so we can judge their efficacy. Not a peep from Aaron on these great mysterious baskets. So…his proposal is, kill Polymet…and then do nothing. Maybe he’s right but it’s certainly not an inspiring path forward.
What?
Aaron is not suggesting killing Polymet. He is wondering if there is a risk, ala Essar, that Polymet might die on its own due to failure to get financing or to come up with a plan that is financially viable in the current market conditions.
Given the status of the copper industry world wide and the costs of production in NE MN, this is a very valid concern. In a weakened market, trying to sell the world’s most expensive copper might not be a good financial strategy. Apparently Antofagasta doesn’t think so, but maybe Polymet will find some people who do.
OK, let’s assume for a moment as you suggest Aaron isn’t against Polymet, he’s just confused and really doesn’t think Polymet is “kicking aside or even burning other baskets (investments)” as he states. OK? You ok with that assumption Gerald?
If so, what’s in those baskets, what investments is he referring to that are being kicked aside? Bring some light to the mysterious investments so we can decide if they’re worthy.
Stay focused on the question now Gerald, no leftist poly of changing the subject.
You adhere closely with the definition of an internet troll, Bob. (https://www.thomasvan.com/random-philosophy/internet-slang-where-did-the-word-troll-come-from) You’re not comprehending or willfully misconstruing what I said or what Gerald is trying to tell you. I feel like you are trying to pound the outside world into your narrow assumptions of what we think and do. You’re so far into your frenzy that you don’t even realize that we are presenting a center-left position, far more amenable to PolyMet than many in the DFL would.
In a ten year quest to support PolyMet the Iron Range has done relatively little, and certainly less than possible, to diversify the economy, cultivate entrepreneurship or build the educational and technological infrastructure to do anything other than mine. But these mines are subject to the whims and limitations of global financiers, as likely to stall as happen. Meanwhile, the region waits, suffering economically and culturally, while we could be using this time and our limited funding in a better way.
You’ve read more of my posts than most other humans, Bob. You’ve stomped your feet and demanded examples before, and I’ve obliged. If you don’t understand the examples I’ve listed time and time again, just read the blog. If you don’t like my examples, suggest your own. I won’t be replying. If you insist on misrepresenting what I say, you will not be welcome here.
I apologize if I’ve offended you Aaron. I’m simply an average Ranger, reading what’s been written verbatim and responding honestly, accordingly with data and reason. I’ll bow out of this one…shalom.