Some people look at Wisconsin’s Penokee Hills, 80 miles southeast of Superior, and see pristine wetlands, forest, trout streams, and wildlife. Others in this economically depressed area see jobs.
Bill Williams, President of Gogebic Taconite, sees iron. "We have proposed a state–of–the–art taconite mine that can produce iron for Great Lakes manufacturing and jobs for generations of Wisconsinites."
Environmentalists and many area residents foresee habitat loss and pollution in the hills, which stretch from southwest Ashland County to Michigan’s northwest Upper Peninsula. Streams flow from the mine site into the Bad River and Lake Superior.
Mining this region could "redefine the face of the North Woods," says Mike Wiggins, Chair of the Bad River Band of Lake Superior Chippewa. "After all this goes away, guess what? The open pit mine sits there and so do we."
"The proposed…iron mine would destroy the Bad River watershed and [our] way of life," according to a statement from the Band. The reservation occupies about 200 square miles east of Ashland. Its southern boundary is six miles from the proposed mine site.
The Bad River flows through the reservation, ending at the Kakagon Sloughs, the largest intact wetland on Lake Superior. The Sloughs contain large stands of wild rice harvested by Band members.
Last November, Gogebic (pronounced "go–GIH–bick") Taconite (G–Tac) announced plans for a 22–mile open pit iron mine and an on–site taconite pellet plant in the western Penokees. The first phase would stretch four and a half miles between the towns of Mellen and Upson.
G–Tac is a subsidiary of the Cline Group, owned by Florida billionaire Chris Cline, whose holdings include coalmines in southern Illinois and West Virginia.
The company has touted 600 to 700 long–term mining jobs and 3,000 short–term construction jobs from the Gogebic project. A study commissioned by G–Tac and released last summer projected the mine will have a $600 million annual impact.
John Senda, Chair of the Iron County Republican Party, is enthusiastic about the economic potential. He says the county of 6,000 has relatively high unemployment, low incomes, and most residents support the mine. "We’re asking for jobs, plain and simple."
According to Bureau of Indian Affairs data, the Bad River Reservation had 81 percent unemployment as of 2005, while nearby Red Cliff was at 61 percent.
Yet the tribes take issue with Senda’s position. "My people…would rather have clean water than a job," says Marvin DeFoe, Vice Chair of the Red Cliff Band.
Mine opponents are skeptical of the economic benefits, citing negative impacts on tourism, agriculture, and the boom–and–bust nature of the industry. Both sides agree the area has suffered a deep mining bust.
The first iron ore mine in the Penokees was dug in 1884. Forty mines operated on the Wisconsin side until 1965, when the last one, in Hurley, closed.
Supporters consider mining part of Wisconsin’s heritage. There is a miner on the state flag. The badger mascot represents early lead miners.
But there has been no active mining in the state since Flambeau, a sulfide mine near Ladysmith that shut down in 1997. The last iron mine operated near Black River Falls until 1983.
"We live within…the ruins of the first round of iron ore mining, with virtually no adverse effect," says Bob Walesewicz of the Hurley Chamber of Commerce. "We drink the groundwater. We recreate in the areas…The notion that if there’s mining activity, there will be devastation to the environment, we just haven’t seen it and now we’ve lived it over 120 years."
East of Hurley, the city of Wakefield, Michigan uses water from an abandoned shaft mine for its municipal drinking water, according to Walesewicz.
Unlike previous mines in the Penokees—which have all been underground—G–Tac would turn the hills inside out, carving a pit up to 900 feet deep to get at the Ironwood Formation, a band of iron–rich rock estimated to contain 15 percent of recoverable taconite ore in the U.S., more than two billion tons.
Houston–based RGGS Land and Minerals acquired the Penokee property from U.S. Steel in 2004 and began seeking investors with an interest in mining it.
Because G–Tac has yet to apply for a permit, details about the proposal are scarce. The company has suggested the mine will produce up to eight million tons of taconite pellets per year. The ore would be crushed into powder and its iron extracted with magnets.
According to G–Tac estimates, at least 16 million tons of tailings and 10 million tons of waste rock would be produced each year. Much of the "overburden"—material removed to get to the iron ore—would come from the Tyler Formation, a slate layer containing unknown quantities of pyrite, which is a sulfide mineral.
When exposed to air and water, sulfide rock can generate acid runoff, producing methyl mercury and sulfate, which are both harmful to aquatic ecosystems.
G–Tac plans to dry–stack tailings, a process uncommon in iron mining that involves extracting the water from tailings and placing them in dry piles. Waste rock and tailings would eventually be backfilled into the pit.
It is not yet clear where the waste rock and tailings would go in the meantime. Last January, G–Tac leased 3,300 acres of forest from Iron County, adjacent to the site of its initial pit, possibly for waste storage.
Milwaukee physician James Minikel, who owns property next to the leased land, testified at a December 14 public hearing that Williams told him this is where the tailings will be dumped. He said the examples he was shown were "extremely fine" tailings, which Minikel was concerned could blow around and cause respiratory problems.
Groundwater would be pumped out of the pit, drawing down the water table, but how much would be used and what would be discharged is also still unclear.
Williams says the company plans to recycle most of the water to reduce withdrawals and discharge. He acknowledges the mine would impact wetlands, but says this can be minimized.
"Mines have to go where the ore is…We will avoid every impact that we can, minimizing those that we can’t and mitigating those that cannot be avoided at all. We will reclaim the site and create new wetlands to replace any impacted and will even create additional wetlands on top of that."
But Wiggins says it is hard to know the full extent of any environmental effects because G–Tac has been less than forthcoming with information. "They’re sitting on all of their drilling permits, doing nothing to illuminate what is truly at stake and what are truly going to be the tangible tailings and other types of things that we’re going to be dealing with.
"We are the ones that are going to be impacted when you say groundwater impacts…We are the ones that are going to be drinking contaminated water."
Williams says the company has examined old core samples from the area, but they are owned by the companies that drilled them and are not publicly available.
The Wisconsin Department of Natural Resources (DNR) granted G–Tac a permit to drill for 28 new samples last summer, but the company suspended its operations pending possible changes to mining law.
At a public information session in Ashland last January, Matthew Fifield of G–Tac said the company would work within Wisconsin’s existing laws, not seek to change them. However, the first draft of an iron mining bill was dated January 2011 and became public in May.
After opposition from environmental groups and some Democratic lawmakers, the bill, written by Representatives Mark Honadel and Rich Zipperer, was not introduced before the spring legislative session ended.
In June, G–Tac suspended plans until the state legislature considered measures to speed up the iron mine permitting process.
State law currently covers all surface mining. A unique provision, known as Wisconsin’s sulfide mining moratorium, stipulates that if any sulfide minerals are in the deposit, the permit applicant must bring forward an example of a North American mine that has operated or been closed for 10 years without polluting.
A new bill introduced in December would create a separate law for iron mining without the moratorium, while leaving it in place for mines that target sulfide minerals. G–Tac argues it won’t generate acid because the iron is not part of a sulfide deposit.
George Meyer, Director of the Wisconsin Wildlife Federation and former Secretary of the DNR, disagrees. "What matters is what’s in the whole deposit, including the overburden…It’s beyond a shadow of a doubt that this bill weakens substantially the environmental standards of the state of Wisconsin."
The bill was introduced to an Assembly committee without any author listed. Republican legislators and bill supporters have been tight–lipped, refusing to answer questions about who put the bill together.
In December, the Milwaukee Journal Sentinel reported that Honadel ordered the bill to be written with the collaboration of Republican Representatives Robin Voss, Scott Suder, and Mary Williams (no relation to Bill Williams), who chairs the committee where the bill was introduced.
G–Tac lawyers and business lobbying group Wisconsin Manufacturers and Commerce provided much of the bill’s substance, according to the Journal Sentinel.
G–Tac executives, their law firm, and RGGS have together donated $40,000 to political campaigns, including $10,000 to Governor Scott Walker and $2,500 to Honadel, according to Wisconsin Democracy Campaign.
In August, the Wisconsin Center for Investigative Journalism reported G–Tac spent about $115,000 lobbying state officials.
Bill Williams says the company just wants to know what they’re up against. "What we ask is an objective permitting process that operates within reasonable timeframes. We are a business that has to make investment decisions on a $1.5 billion project…I’m sure you can appreciate how difficult it would be to obtain financing for a project this size with an open–end approval process."
Mine supporters want regulation similar to that in Minnesota and Michigan, where there are active iron mines. "We need to be competitive," says Tim Sullivan, chair of the Wisconsin Mining Association. "For the first time in 16 years, we have an investor…They typically are not [interested] because of the timeframe involved."
Neighboring states have permit deadlines, but they can be pushed back. Recent permits in Minnesota have taken two to five years and cost up to $3 million, according to DNR representative Ann Coakley.
The minimum time for permitting under current Wisconsin law is two and a half years, but the bill would limit review to 360 days and cap the reimbursement paid by the applicant at $1.1 million. If the DNR fails to make a decision within specified timelines, the permit is automatically approved.
Coakley isn’t sure the DNR could meet the new deadline. "I think if it were a small mine proposal, it could be enough [time]. I think if it were a large–scale proposal, it might not be enough."
G–Tac isn’t the only one that wants this bill to pass. The two largest mining equipment manufacturers, Caterpillar and Joy Global, have factories in Milwaukee and staunchly support the legislation.
"If this mine goes ahead, we see the opportunity for potentially hundreds more jobs to be created," says Joy Global representative Mark Sanders.
The December 14 Milwaukee hearing was held six days after the bill was introduced. Mary Williams initially refused to hold a hearing on the bill up north, saying an October hearing in Hurley was adequate.
State Senator Bob Jauch and Representative Janet Beweley, who represent the area, scheduled an unofficial public hearing in Ashland on January 7. A few days before, Williams announced a second hearing in Hurley for January 11. The Ashland hearing was canceled, which upset some area residents.
"Half of this mine is in Ashland County," says Pete Rasmussen of Marengo. "It entirely drains into Ashland County. All that we’re hearing is Iron County and Hurley. For these hearings not to be held in the affected county, for the people of the affected county not to be given a voice…sucks."
Other provisions in the bill would:
•cut revenue to local governments by half;
•eliminate contested case hearings, a form of legal proceedings built into the current permitting process;
•reduce required public hearings from six to two;
•exempt mining from floodplain zoning ordinances;
•relax wetlands and groundwater regulations for iron mines; and
•take precedence over any conflicting state environmental regulations.
"I see that permitting process as a filter," says Wiggins. "When garbage goes in, it isn’t automatically garbage out. The Republican legislators are…trying to make this filter as porous as possible so that whatever goes in will automatically come out. They’re stripping away a lot of citizen input. They’re minimizing the ability of local municipalities to seek recourse if things go bad with this mine."
Whatever the outcome of the bill, G–Tac will still have to deal with federal agencies and with the tribes. The bill might actually delay permits by making it harder for the DNR to work with federal regulators from the Environmental Protection Agency and the U.S. Army Corps of Engineers, whose approval is required for projects that impact wetlands or waterways.
"Three hundred and sixty days may not be an adequate amount of time for us to partner with the state on preparation of the Environmental Impact Statement," says Army Corps representative Rebecca Grasser.
Last year, the Bad River Band was granted the right to set quality standards for waters within or flowing into the reservation. Wiggins says the bill’s drafters have not consulted the Band.
"Mining initiatives…are going to mean big changes for…some of the harvesting opportunities that are there for Ojibwe tribes," says Wiggins. "All of those tribes are going to want a say in that…We’re willing to go to the mat on this stuff."
> The article above was written by Carl Sack, and first appeared in the January 17, 2012 issue of the Zenith City News.