Now that the dust has settled after the mid-term elections, the Senate Energy and Natural Resources (ENR) Committee and the House Natural Resource Committees, two of the primary committees with jurisdiction over mining and mineral legislation, have finalized their committee assignments and leadership for the coming year. With the flip in the Senate to Republican control, the ENR Committee will be led by Lisa Murkowski (R-AK) and the ranking member will be Maria Cantwell (D-WA). Joe Manchin (D-WV) retains his slot as chair of the ENR subcommittee on Public Lands, Forests and Mining. On the House side, Rob Bishop (R-UT) will chair the full committee and Doug Lamborn (R-CO) returns as chair of the subcommittee on Energy and Minerals Resources. Raul Grijalva (D-AZ) will assume the position of ranking member on the full committee.
Global demand for coal over the next five years will grow at an average rate of 2.1% per year through 2019, breaking 9-billion tons, according to the International Energy Agency (IEA) in its annual Medium-Term Coal Market Report, released December 15. The report notes that despite China's efforts to moderate its coal consumption, it will still account for three-fifths of demand growth during the outlook period. Moreover, China will be joined by India, ASEAN countries and other countries in Asia as the main engines of growth in coal consumption, offsetting declines in Europe and the U.S.
On Dec. 12, Rep. John Delaney (D-MD) introduced legislation that would tap U.S. multinational corporations' earnings held overseas to help pay for a six-year highway and transit bill. The Infrastructure and Global Tax Competitiveness Act, H.R. 5857, seeks to eliminate the incentive for corporations to continue to hold accumulated earnings offshore, to invest in domestic infrastructure, and to provide for international tax reform. Specifically, the bill would impose a mandatory 8.75 percent repatriation tax on such earnings, compared with the current 35 percent threshold for corporate income, according to a news release. In all, the plan would raise between $150 billion and $175 billion over six years, according to an estimate from Delaney's office. Of that sum, up to $125 billion would go to the Highway Trust Fund. The proceeds would also finance a $50 billion infrastructure fund that could be used by state and local governments to leverage $750 billion for other projects in such areas as transportation, water and energy.
During the week of Dec 8, the House and Senate passed the $585 billion National Defense Authorization Act (NDAA), which includes a massive package of public lands bills that allows a swap of mine lands for federal lands in Arizona that will benefit Rio Tinto’s Resolution Copper project near Superior. The Southeast Arizona Land Exchange and Conservation Act (H.R. 687) was part of the NDAA and passed both Houses of Congress with strong bipartisan support. Passage of the legislation means that Resolution Copper can move forward with the development of this world-class ore body which will create approximately 3,700 jobs, generate over $60 billion in economic impact and result in almost $20 billion in state and federal tax payments. It will become law as soon as President Barack Obama signs it. Rio Tinto will take possession of the land a year later.
On December 11, the House of Representatives passed H.R. 5742, the Soledad Canyon Settlement Act, that directs the Secretary of the Interior to cancel Bureau of Land Management mineral contracts owned by global aggregates producer Cemex, who was hoping to open a sand and gravel operation near Soledad Canyon, California. The BLM would be required to sell federal land near Victorville and use the proceeds from the sale to compensate Cemex for its contracts. A similar bill was introduced Nov 18 in the Senate. The city of Santa Clarita has been battling the Cemex mine for about 15 years. Both bills would also prohibit future mining on the site.
In a new report from the International Energy Agency (IEA), World Energy Outlook 2014, coal demand is expected to be 15 percent by 2040 and growth will slow significantly after 2020. Further, they estimate demand will peak in China, drop by a third in the United States but keep growing in India. IEA predicts renewables to be the world’s leading fuel for energy production by 2040.
On November 12, SME joined with 375 trade associations, professional societies and chambers of commerce from 50 states representing a wide range of industries to voice strong concerns with the EPA and the Corps of Engineers’ proposed rule to dramatically expand the scope of federal authority over water and land uses across the U.S. Further, the letter called for the proposal to be withdrawn. The “Waters of the U.S. “ proposal would allow federal jurisdiction over intentionally created waters located in upland areas at mine sites. Diversion ditches that redirect storm water runoff around mine sites would become “tributaries” under the proposal. In addition, it would expand federal jurisdiction over waters from 3.5 million river and stream miles to well over 8 million river and stream miles, affecting many sand and gravel operations. This effort was led by the U.S. Chamber of Commerce.
The Republicans took control of the U.S. Senate and retained control of the House of Representatives as a result of the Nov 4 elections. This bodes well for the mining industry as pro-coal lawmaker Mitch McConnell (R-KY) becomes Senate majority leader and Lisa Murkowski (R-AK) may now chair the Senate Energy and Natural Resources Committee. Murkowski is an advocate of responsible mine development and may push for hearings on stalled Senate bills related to critical and strategic minerals. Rep. Shelley Moore Capito (R-WV), who replaces long time Senator Jay Rockefeller, is also a pro-coal advocate and has been helpful to SME in pushing the SEC to initiate a rulemaking on standardizing Industry Guide 7 on resource and reserves. Doug Lamborn (R-CO), Chair of the House Subcommittee on Energy and Mineral Resources retained his seat, as did pro-mining Rep. Mark Amodei (R-NV) and Mike Coffman (R-CO); all three have addressed the SME members and Board in the last two years. In a nod to the aggregates industry, Senator Jim Inhofe (R-OK) will likely chair the Environment and Public Works Committee, that holds the key to stalled long-term infrastructure investment bills. In Governor races, western mining states either held or gained Republican control. Montana elected Rep. Steve Daines Governor, Idaho Governor Butch Otter retained his seat as did Nevada’s Brian Sandoval, and Arizona elected State Treasurer Doug Ducey to Governor.
Starting in 2013, MSHA set aside Oct 30 as Mine Rescue Day to recognize the dedication and sacrifice of the volunteers who form the backbone of our national response in the event of a mining emergency. The date was chosen for its historic significance. On Oct. 30, 1911, the first national mine rescue demonstration was held at Forbes Field in Pittsburgh, PA. It was organized by Dr. Joseph A. Holmes, a visionary in mine safety and the first director of the U.S. Bureau of Mines. Among the 15,000 spectators was President William Howard Taft. Also on this date in 2013, the national Holmes Mine Rescue Association was formed to provide support and guidance for mine rescue and serve as a vehicle to disseminate guidelines, training and tools to the mining community. MSHA’s review of mine emergency response has led to a new mine rescue response station in Madisonville, KY to serve the Midwest; improvements in the agency’s mobile response vehicles and command center equipment; the staging of mock mine emergencies with mining companies; revisions to the criteria for mine rescue team certification to include hands on skills training; and an overhaul of the national mine rescue training contests with greater stakeholder participation. As of November 4, 2014 MSHA has recorded 33 fatalities year-to-date, including 13 in coal and 20 in metal/non-metal.
SME, and a nationwide coalition of mining, agriculture, manufacturing, commercial, industrial and government groups, are calling on the EPA to withdraw its proposed rule that would greatly expand federal jurisdiction under the Clean Water Act to areas of the land not previously subject to regulation, including isolated upland areas, intentionally created waters at mine sites, and intermittent and ephemeral streams that are inferred to have a tenuous surface or groundwater connection to true waters of the U.S. The proposal would give federal agencies direct authority over land use decisions that Congress has intentionally preserved to the States. Final comments are available for your review. A one-page summary sheet can be found here.
On August 1, MSHA’s new dust rule, “Lowering Miners’ Exposure to Respirable Coal Mine Dust, Including Continuous Personal Dust Monitors,” went into effect. According to the agency’s analysis of 7,456 valid samples obtained from coal mines, 99 percent met compliance levels. The rule substantially increases operator sampling for respirable coal mine dust and requires an operator to take immediate corrective action when an operator’s sample shows excessive concentrations. The final rule authorizes MSHA to cite an operator based on a single MSHA sample showing excessive dust, rather than on an average of samples. MSHA will host a series of workshops on “Best Practices for Controlling Respirable Dust in Coal Mines,” the first of which will take place on Oct. 28, at the National Mine Health and Safety Academy in Beaver, WV. Additional workshops will be held in Birmingham, AL; Evansville, IN; and Grand Junction, CO, in 2015.
|Members of Congress Question the Interior Department’s Bias & Lack of Transparency with Federal Sage Grouse Science
||SME eNews - October, 2014
On October 16, 2014, House Natural Resources Committee Chairman Doc Hastings (WA-04), Public Lands and Environmental Regulation Subcommittee Chairman Rob Bishop (UT-01), and 16 Members of Congress sent a letter to the Secretary of the Interior Sally Jewell expressing ongoing concerns with the Department’s potential future listing of the Greater Sage Grouse under the Endangered Species Act (ESA). Specifically, the letter notes concerns with the Department’s closed-door and seemingly selective process for evaluating relevant data and science, and failure to adequately coordinate with affected states that are developing their own data and conservation efforts to avoid the need for a listing of the Greater Sage Grouse under the ESA.
A broad coalition of highway users, construction sector groups, and the general business community have come out strongly opposed to the Transportation Empowerment Act (TEA), which has been introduced in the Senate and the House, that would effectively eliminate the federal highway program by devolving the tasks of maintaining and funding all surface transportation to the states. The bill would reduce funding for the federal-aid highway program by more than 80 percent by 2019, leaving states with the primary responsibility of maintaining the nation’s highways. In some cases, state governments would have to raise their gas tax by as much as 30 cents to make up the difference. The bill would virtually eliminate the federal government’s constitutionally mandated role in promoting interstate commerce. The legislation was offered in Senate as an amendment to the Highway Trust Fund patch approved in July. While it didn’t garner sufficient support for adoption, 28 Republican senators voted in favor of the amendment. Construction groups opposed to this bill have demanded passage of a long-term surface transportation bill before funding for the program expires in May 2015.
On Sept 30, a federal judge upheld EPA's 2011 retroactive Clean Water Act permit veto of Arch Coal Inc.'s Spruce No. 1 mountaintop coal mine in West Virginia. U.S. District Court for the District of Columbia rejected Arch's arguments against the court's veto decision, which the judge deemed "reasonable, supported by the record and based on considerations within the agency's purview." This litigation has spanned four years, while Arch has sought the Clean Water Act Section 404 permit for Spruce for more than a decade. Arch had argued that the permit was legally issued by the Corps of Engineers before EPA used its veto authority to reverse the Corps decision. The company said it still believed EPA's actions were arbitrary and capricious and that it was weighing its next steps with regard to the litigation. Also, Arch conceded that legislation may be the best remedy for this situation.
On Sept 25, MSHA awarded $1 million through its Brookwood-Sago grants program to seven organizations that provide education and training within the mining industry. The funding will be used to develop and implement training and related materials for mine emergency preparedness, as well as for the prevention of accidents in all underground mines. The Colorado School of Mines is receiving $183,552 in funding focused on the development of advanced mine rescue skills using multiple training modalities. This includes preshift and on-shift mine examiner training in support of small mine rescue teams in Colorado. The University of Arizona is receiving $136,906 in grant funding for improving miner preparedness and in-emergency resiliency using multiplayer emergency response simulations. The Pennsylvania State University is receiving $109,917 to develop an education and training toolbox for coal mine rescue instructors and mine rescue team members.
On September 18, Representatives David McKinley (R-WV) and Peter Welch (D-VT) introduced a bill, “The Healthy Employee Loss Prevention Act of 2014,” that would establish a worker assistance program to provide job retraining and relocation for workers who have lost their jobs due to unplanned closure of coal and coal dependent industries. Under the McKinley-Welch bill, workers would be eligible for government assistance is their coal job loss is related to a variety of factors including alternative fuels and government regulations. Workers would receive benefits for up to one year and could apply for a one year extension. The Blue-Green Alliance, a coalition of unions and environmental groups, praised the legislation. The lawmakers said their legislation is modeled after the Trade Adjustment Assistance Act which helps U.S. workers who have been displaced by foreign trade.
The National Mining Association commissioned SNL Metals & Mining to conduct a study that demonstrates the extent to which minerals produced in the U.S. contribute to the domestic manufacturing industries. The report documents domestic supply and demand chains for the U.S. mined commodities and their contribution to the manufacturing sector. Key minerals highlighted included copper, gold, iron ore, molybdenum, platinum group-metals, rare earths, silver and zinc.
In a report from AEMA, the Pebble Limited Partnership, owner of the proposed Pebble gold and copper mine in Alaska, has filed suit against EPA over the agency’s Bristol Bay Watershed Assessment claiming it is a flawed and biased study with a predetermined outcome, developed by the agency to intentionally block the Pebble project. PLP states that the full extent of this biased endeavor is likely not known as there are significant gaps and extensive redactions to the material publicly released under Freedom of Information Act request filed by PLP.
On Sept 9, the House of Representatives passed H.R. 5078, the Waters of the U.S. Regulatory Overreach Protection Act of 2014, with a bipartisan vote of 262-152. The bill prevents the EPA and the Army Corps of Engineers from expanding their regulatory jurisdiction over ponds, streams and ditches currently regulated by the states, and often located in or near mining operations. H.R. 5078 requires the agencies to conduct a transparent consultation with state and local officials to develop a consensus about which waters should be under federal jurisdiction. The bill was introduced in reaction to a rule proposed by these federal agencies to revise the definition of “Waters of the United States” under the federal Clean Water Act. The president has made it clear that he would veto this bill.
U.S. District Judge David Campbell in Phoenix said he would rule in two weeks on a 20-year ban on the filing of new mining claims near the Grand Canyon. Representatives of NMA, AEMA, and other mining interests appeared before the federal judge on Sept 9 to argue on a motion of summary judgment on a lawsuit originally filed in 2012, after former Interior Secretary Ken Salazar in 2012 announced a 20-year ban on new mining claims that covered more than 1 million acres surrounding the Grand Canyon National Park. The region surrounding Grand Canyon National Park is believed to contain as much as 40% of the known U.S. uranium resources.
The House of Representatives passed HR 4315, the Endangered Species Transparency and Reasonableness Act with a bipartisan vote of 233-190. This legislation, which has not been reauthorized since 1988, requires data used by federal agencies for ESA listing decisions to be made publicly available and accessible through the internet; requires the best available scientific and commercial data used by the federal government to incorporate data provided by states, tribes, and local county governments; requires the U.S. Fish and Wildlife Service to track, report to Congress, and make available online the federal taxpayer funds used to respond to ESA lawsuits, the number of employees dedicated to ESA litigation, and attorneys’ fees awarded in the course of ESA litigation and settlement agreements.
On August 15, SME submitted comments to the White House Office of Science and Technology Policy regarding their request for information about critical and strategic materials supply chains and their importance to American prosperity and national security. SME’ focused on the role of maintaining an adequate pipeline of qualified graduates and teachers at U.S. mining schools in order to provide the necessary technical skills needed to maintain the supply chain of critical and strategic minerals. SME’s position is reflected in the March 2013 SME technical briefing paper, “Federal Support for U.S. Mining Schools.” Mining and geological engineering, mineral processing, extractive metallurgy and applied geology and geophysics programs at our universities are national assets that are critical to maintain and encourage the growth of the U.S. energy and minerals workforce. These programs suffer from dwindling federal reinvestment and R&D funding. Without an adequate pipeline of qualified graduates and faculty at U.S. universities, the nation is at a distinct competitive disadvantage in the production of basic raw materials and energy. Workforce availability has become a significant problem for the domestic mining industries.
On July 23, the House Natural Resources Committee held a hearing, “American Metals and Mineral Security: An Examination of the Domestic Critical Minerals Supply and Demand Chain," that addressed the need for timely and environmentally responsible development of the U.S. supplies of strategic and critical minerals to create good-paying mining jobs, boost local economies, and provide security to America’s economy. This hearing underscored the need for Senate action on H.R. 761, the National Strategic and Critical Minerals Production Act, which passed the House last September and would allow the U.S. to more efficiently develop its strategic and critical minerals that are vital to America’s economic competitiveness. Testimony was offered from representatives from GE, Doe Run, SNL Metals and Minerals, Idaho National labs and the National Defense Industrial Association.
The Senate appropriations committee released a draft $30.7 billion fiscal 2015 spending bill to fund the Interior Department, EPA and the Forest Service that cuts the Office of Surface Mining’s budget by $6.6 million from the previous year. The Senate bill comes weeks after the House Appropriations Committee passed its own $30.22 billion fiscal 2015 spending bill for the agencies, a bill that contained various policy riders seeking to weaken President Obama's climate and environmental goals. The Senate spending proposal would give the Dept of Interior's Office of Surface Mining $116 million for regulation and technology. In contrast, House Republicans want to give OSM $121 million but limit its ability to promulgate the forthcoming stream protection rule. The Senate spending bill would provide $28.7 million for the abandoned mine reclamation fund, a $1.3 million boost from current levels. The House would leave the line item mostly untouched. Among the House bill's many policy riders are provisions that would block EPA from requiring power plants to lower carbon dioxide emissions and from increasing the number of streams and wetlands that get automatic protection under the Clean Water Act.
In an effort to limit mountain top coal removal activities, the EPA has proposed non-binding Clean Water Act guidelines for selenium that are slightly weaker than the selenium standards EPA tried, but failed, to adopt in 2004. Environmental groups have filed numerous lawsuits against coal companies over their pollution discharges and are attempting to use EPA’s selenium standards as new legal limits to force closure of mountain top mines. The new selenium guidelines are generally supported by industry as they welcome EPA's decision to put more emphasis on fish tissue selenium concentrations that are toxicologically and ecologically relevant in enforcing water quality standards.
Mining fatalities in the U.S. have spiked in the first half of 2014, according to recent statistics from MSHA. 25 miners have died year-to-date, compared to 18 in the first half of 2013, and 19 in the first half of 2012. Eight coal miners died during the first half of 2014. The other 17 deaths were in the metal and nonmetal mining sector. The majority of the mining deaths have been caused from accidents involving heavy equipment and machinery. Other miners died from falling, and/or being hit by heavy objects, explosions or drowning. A total of 42 fatalities were recorded in 2013. MSHA issued a statement, “Mining fatalities are preventable, and they are a reminder that much more needs to be done to protect the nation’s miners. These deaths should serve as a wake-up call for all of us to keep safety at the forefront at all times.”
On August 6, SME issued its latest technical briefing paper, "The Safe and Effective use of Cyanide in the Mining Industry.” This paper, the 14th in the series, provides a general overview on the use, proper management and control of cyanide and its application to recover gold from ore.
On July 18, EPA proposed restrictions on development of the proposed Pebble Mine in Alaska that may ultimately prevent the mine from operating. Acting under Section 404 of the Clean Water Act, which empowers EPA to limit the Army Corps of Engineers' permitting of dredge-and-fill projects in U.S. waters, the agency stopped short of an outright veto of the Pebble mine but proposed restrictions likely to make its development difficult, if not impossible. EPA, which has been formally deciding whether to take action against the Pebble mine since February, released a proposed determination prohibiting the loss of 5 or more miles of salmon-bearing streams and any activities that would alter flows in salmon streams that would result in the loss of 1,100 acres or more of wetlands, lakes and ponds that connect with salmon-bearing streams. EPA's Bristol Bay Watershed Assessment found that a major open-pit mining project such as that discussed by Pebble developers would destroy between 24 and 94 salmon streams and 1,300 to 5,350 acres of wetlands, ponds and lakes.
In an effort to help garner bipartisan political support for changes to Industry Guide 7, the SEC’s basic disclosure policy for US mining companies, SME and the National Mining Association garnered signatures from 13 members of the House Financial Services Committee on a July 7 letter to SEC Chair Mary Jo White urging the Commission to update IG7 as quickly as possible to avoid further competitive disadvantage for US companies. To-date the SEC refuses to allow US mining companies to report Minerals Resources as well as Mineral Reserves thus forcing companies to underreport the possible value of a mining company to potential investors. This letter is a direct result of the SEC’s inaction on the SME petition filed in October of 2012 asking for a public and transparent notice-and-comment rulemaking process to update IG7.
On July 11, in a unanimous decision that reversed a lower court ruling, the U.S. Court of Appeals for the District of Columbia Circuit sided with EPA in a broad challenge from Kentucky and West Virginia and the NMA and upheld current administration policies that address the environmental effects of mountaintop mining on waterways. In June 2009, EPA and the Army Corps of Engineers adopted an "enhanced coordination process" that allowed EPA to screen Section 404 dredge-and-fill permit applications before the corps approved them. Two years later, EPA issued a "final guidance" that required state authorities to impose more restrictive discharge requirements on federal water permits for mining operations. Industry groups challenged both policies, arguing that they exceeded EPA's statutory authority and amounted to new regulations that required public notice and comment periods. The court opinion states, "In our view, EPA and the Corps acted within their statutory authority when they adopted the Enhanced Coordination Process. And under our precedents, the Final Guidance is not final agency action reviewable by the courts at this time."
On July 10, Rep. Peter DeFazio (D-OR), Ranking Member of the House Natural Resources Committee, introduced legislation to dramatically reform the Mining Law of 1872. DeFazio's proposal would create an 8 percent royalty on gross income from new mines and a 4 percent royalty on income from existing mines. Small operators would be exempt. Further, it would direct royalty dollars to abandoned hardrock mine cleanup. The bill would enact a new 7-cent-per-ton fee on material displaced during mining for the same purpose. Another aspect of DeFazio's bill provides protections for good Samaritans. Also, the bill would make new lands, including wilderness study areas, off-limits to hardrock mining and would make it easier for federal regulators to deny hardrock mining permits. It would also create new bonding requirements. Natural Resources Committee Democrats released a report to accompany the legislation, which says 46 top mines produced more than $9 billion in minerals and would have paid $380 million in royalties during 2012 and 2013 under the bill.
In a June 25 letter to House and Senate leadership, SME, and 32 other national trade associations and professional societies, called for Congress to take significant and immediate steps to pass stalled critical and strategic minerals legislation that would benefit the mining-to-materials supply chain in the energy, transportation, agriculture, infrastructure and other sectors of the U.S. economy. Specifically, the letter requests congressional action that would curtail foreign dependency, reduce permitting delays, update geologic databases, bolster research and encourage efficient use of critical and strategic minerals. Senator Lisa Murkowski, Ranking Member of the Energy and Natural Resources Committee issued the following statement upon receiving the SME/coalition letter: “This letter puts nearly 40 groups and organizations on record as supporting not just their members, but our nation’s security, competitiveness, and future growth. I thank them for their support and commend their continued engagement on this issue. I also agree with them. This is the perfect time to update our nation’s mineral policies. We have bipartisan and cost-neutral legislation that is ready to be considered. We have no reason to wait, or to forgo the tremendous benefits that critical minerals legislation would provide throughout our economy.”
Roof and rib failures are a leading cause of injuries in underground coal mines, according to MSHA. During 2013, 265 miners were injured in roof and rib falls, down from 377 in 2012. Every year, MSHA undertakes a Preventive Roof/Rib Outreach Program to increase awareness among miners and mine operators of the hazards of roof and rib falls. The 2014 campaign, which runs through September, will focus on conditions specific to the summer months. MSHA has developed informational posters, hard hat stickers and lists of best practices, which will be distributed to miners and mine operators during normal inspections. The information also will be used by MSHA inspectors during safety talks with operators and groups of working miners. In addition, MSHA inspectors are distributing an Accident Prevention Alert that lists best practices to prevent roof and rib accidents related specifically to retreat mining.
According to the U.S. Energy Information Administration, U.S. coal production during first quarter 2014 totaled 242.3 million short tons. This was 1.3% higher than the previous quarter, but 1.1% lower than first quarter 2013. First quarter 2014 U.S. coal exports (27.7 million short tons) dropped 12.9% from first quarter 2013, but remained consistent with exports in fourth quarter 2013. U.S. coal consumption totaled 248.6 million short tons in first quarter 2014; this was 10.0% higher than the 226.1 million short tons reported in fourth quarter 2013 and 8.5% higher than the 229.0 million short tons reported in first quarter 2013.
In a landmark ruling, a West Virginia federal court judge faulted subsidiaries of Alpha Natural Resources Inc. for affecting the conductivity levels of regulated waters and, as a result, hurting aquatic life. EPA and environmental groups have been pressing for years for the use of conductivity- the measure of how well waters carry an electric charge - as a barometer of environmental health. In the ruling the court sided with environmental groups and declared that discharges from the coal mine adversely affected the conductivity of the receiving waters and was therefore in violation of their state and federal permits. Mining companies and some state regulators have argued that conductivity is not a pollutant. They cite a 2012 U.S. District Court ruling against an EPA guidance document setting suggested conductivity levels for waterways near Appalachian coal mines. An appeals court ruling is forthcoming.
More than 184 national and state associations and organizations representing agriculture, construction, house, manufacturing, utilities, energy production and transportation have joined U.S. mining groups in their support of legislation to be introduced in the U.S. House to curtail EPA’s efforts to expand its authority under the Clean Water Act (CWA). Congressmen Bob Gibbs (R-OH) and Nick Rahall (D-WV), announced their intent to introduce legislation “to reign in EPA’s preemptive veto authority over Clean Water Act permits. In a June 5th letter to the House Transportation & Infrastructure Committee, these organizations declared, “It is vital that, once companies receive their permits, the companies - as well as the investors - can rely on those permits not to be revoked at any time for any reason. Finally, it is extremely important that EPA and the Corps not be permitted to arrogate authority to themselves that Congress never intended.” EPA issued a retroactive veto in 2011 to Arch Coal’s Spruce No. 1 Mine in West Virginia and are considering a preemptive veto of the Pebble mine in Alaska.
On May 27, SME and a coalition of geoscience organizations, sent this letter to all legislative directors, chief of staffs and science/space legislative assistants in the House of Representatives seeking Congressional support for strong funding levels for geosciences, including finding and maintaining adequate supplies of minerals and natural resources. Subsequently, on May 30, the House voted 321-87 to pass the “Commerce, Justice, Science, and Related Agencies Appropriations Act, 2015” that are the appropriations bills for the federal science agencies for FY 2015, including the National Science Foundation.
On May 29, the Securities and Exchange Commission asked federal judges to reconsider their decision striking down a rule requiring companies to disclose whether their products contained conflict minerals. In April, the U.S. Court of Appeals for the District of Columbia Circuit upheld most of that rule which the commission promulgated under the 2010 Dodd-Frank Wall Street reform legislation. However, the D.C. Circuit struck down the requirement that companies state on their websites that components of their goods may have originated in the DRC. The court held that such a provision violates the First Amendment by forcing companies to make disclosures. The SEC has asked the D.C. Circuit for a rehearing after the D.C. Circuit decides on a similar case involving a requirement that food packaging labels include the country of origin for the meat in the product. The SEC said that case may affect the important constitutional questions addressed by the court’s First Amendment ruling in this case.
The Federal Mine Safety and Health Review Commission is considering a legal challenge by a subsidiary of Patriot Coal to MSHA’s use of the controversial Pattern of Violations (POV) designation for mines with repeated significant and substantial violations. Last year MSHA streamlined the process for putting mines under the POV program and Patriot's Brody Mine No. 1 in Boone County, W.Va., was one of the first that MSHA selected. In January, Chief Administrative Law Judge Robert Lesnick ruled in MSHA's favor saying, "The (MSHA) Secretary has established that his revised POV rule is a prosecutorial tool he has used to identify (operators) critically in need of improvement in its approach to ensuring the health and safety of its miners.” Brody is now seeking appellate review by the full commission.
| New Mexico national monument designation takes energy and mining development off the table
||SME eNews - May, 2014
On May 21, president Obama signed a proclamation setting aside 496,000 acres of public lands in southern New Mexico from future energy development or mining. Using the Antiquities Act, Obama will create the Organ Mountains-Desert Peaks monument, his 11th and largest national monument to date that still allows access for hunting, recreation and ranching. It also marks Obama's first monument opposed by the local congressman. Rep. Steven Pearce (R-NM) has long criticized the president's use of the Antiquities Act and is pushing his own bill to designate a smaller, 55,000-acre national monument.
The U.S. Forest Service has proposed amendments to its internal directives and Best Management Plans to address groundwater quality and protection with respect to minerals management on National Forest Service lands (see page 61). The USFS is proposing that authorizations for minerals or energy development comply with the requirements of the Underground Injection Control Program, clarify that groundwater use for mining is discretionary and must be addressed through the mining plan of operations, and evaluate and monitor both potential and existing mines as potential sources of groundwater contamination. Additionally, plans of operation for proposed mines will be required to include appropriate operating procedures, facility designs, bonding and groundwater monitoring. Likewise, the agency will recommend to leasing and permitting agencies appropriate lease terms, design modifications and approval conditions to protect groundwater resources on NFS lands. Comments on the proposed groundwater management directive are due by Aug. 4. Comments on the proposed national BMPs are due by July 7, 2014.
On May 14, EPA announced the release of the external peer review draft, Aquatic Life Ambient Water Quality Criterion for Selenium. Selenium is naturally occurring and can be released to the environment by coal mining, coal-fired power plants and phosphate mining, among others. Selenium is a bioaccumulative pollutant. These guidelines are not a rulemaking but a nonbinding guidance for states in adopting water quality standards that ultimately provide a basis for assessing water body health and controlling discharges or releases of pollutants. For mining operations, the recommended 30-day average concentration of selenium in flowing water should not exceed 4.8 mg/L and 1.3 mg/L in standing waters more than once in three years on average. The public comment period ends on June 13. Scientific views can be submitted via email to EPA at email@example.com, attention docket # EPA–HQ–OW– 2004–0019.
Some good news for the infrastructure-dependent aggregates industry; on May 15, the Senate Environment and Public Works Committee unanimously approved a six-year surface transportation reauthorization bill, known as the MAP-21 Reauthorization Act, that would fund projects through fiscal year 2020. No announcement has been made about when the full Senate will consider the bill. Following the markup meeting the next step is to find a way to fund the bill. There has been concern about funding transportation projects, especially because the primary source of funding - the Highway Trust Fund which funds most state and local projects - is projected to become insolvent by late August, at least a month before the current highway bill, MAP-21, expires.
The Bureau of Land Management provided notice of its plans to develop rules to control methane releases from mining operations on public lands in the April 29 edition of the Federal Register. Methane makes up nearly 9 percent of man-made greenhouse gas emissions; roughly 10 percent of methane emissions come from active or closed underground coal mines, surface coal mines, and post-mining operations. The rulemaking also aims to protect miners who may be exposed to methane if it is not vented. Industry representatives and environmentalists alike expressed interest in developing a solution that reduces methane emissions while protecting the safety of workers. BLM’s notice of proposed rulemaking includes a request for comments on potential methods and technologies for methane reductions that are due by June 30, 2014.
Despite the legal uncertainties, the U.S. Securities and Exchange Commission is moving forward with implementing the conflict minerals rule. In April the U.S. Court of Appeals for the District of Columbia Circuit struck down parts of the conflict minerals rule that would have required companies to publicly disclose whether their products may have minerals from the Democratic Republic of the Congo. The three-judge panel, however, upheld other parts of the rule requiring companies to conduct certain due diligence of their supply chain and report to the SEC. On April 29, the SEC released a short guidance statement to clarify that, despite ongoing legal uncertainty, it expected companies to comply with the June 2 reporting deadline. "For those companies that are required to file a Conflict Minerals Report, the report should include a description of the due diligence that the company undertook," said the guidance from Keith Higgins, SEC's corporation finance director.
On May 2, EPA released a proposed rule to reform Clean Air Act rules for uranium mining and milling facilities. Current rules have different radon emission standards for facilities built after and before 1989. Pre-1989 facilities have numeric limits on radon emissions. Post-1989 facilities, on the other hand, have to control radon through limits on impoundments and other waste disposal requirements. The new proposal would create a unified standard and scrap numeric radon limits for those pre-1989 facilities. Instead, the agency will rely on uniform requirements for generally available control technology to achieve compliance. The proposal would apply to all uranium recovery and management facilities, including conventional mills and in-situ leach extraction facilities. In recent months, the Nuclear Regulatory Commission has issued licenses for two uranium mining projects, Powertech Uranium Corp.'s Dewey-Burdock project in South Dakota and Strata Energy Inc.'s Ross uranium mining project in Wyoming.
On May 1, the Senate confirmed Janice Schneider as the Interior Department's assistant secretary for land and minerals management on a 64-32 vote. This position has been filled the last three years by others in acting positions. In her position Schneider will oversee oil and gas, coal, and renewable energy development on federal lands and waters. She replaces acting secretary Tommy Beaudreau, who is director of the Bureau of Ocean Energy Management, will soon become DOI secretary Sally Jewell's chief of staff. While Schneider only needed 51 votes to be confirmed, the tight roll call suggests it could be even more difficult to muster the votes to confirm Rhea Suh as Interior assistant secretary for fish and wildlife and parks.
According to MSHA, through April 28, there have been a total of 13 fatalities in the mining industry; ten in metal/nonmetal and three in coal. MSHA convened a meeting of mine industry stakeholders on May 5 at MSHA headquarters in Arlington, Va. to address the causes of recent spike in deaths, identify actions needed to prevent them and work to reverse the trend. There were 42 fatalities in 2013, which is the highest number of mining deaths since 2010. "The recent news on the rise in mining fatalities is disturbing," said Joseph A. Main, MSHA’s assistant secretary. "It is clear that, at some of the operations involved, basic health and safety protections are not always in place," Main said. "MSHA will provide operators with specific information on the causes and particular issues surrounding each of these deaths, and we will discuss actions needed to prevent these types of fatalities in the future."
President Obama has nominated Dr. Suzette M. Kimball to serve as the Director of the U.S. Geological Survey. Kimball has led the agency in an acting capacity since February 2013. If confirmed by the U. S. Senate, Kimball would lead the agency of more than 8,000 scientists, technicians and support staff in over 400 locations across the U.S. The USGS Director also serves as Science Advisor to the Secretary of the Interior, overseeing activities of the Department’s Strategic Science Group and chairing the team of nine bureau science advisors. Before assuming the USGS Acting Director position last year, Kimball served as the Deputy Director from 2010 to 2013; as the Associate Director for Geology from 2008 to 2010; as the Director of the Eastern Region from 2004 to 2008; and as the Eastern Regional Executive for Biology from 1998 to 2004. Kimball received a Ph.D. in Environmental Sciences/Coastal & Oceanographic Processes from the University of Virginia; an M.S. in Geology/Geophysics from Ball State University; and a B.A. from the College of William and Mary.
This week SME participated in meetings with staff of the House Financial Services Committee to discuss ongoing problems with the SEC’s mineral reserves disclosure reporting requirements for US mining companies, better known as Industry Guide 7. The Financial Services Committee has jurisdiction over the SEC, and their committee staff have agreed to help SME and the National Mining Association circulate letters of support for SME’s petition for rulemaking that SME filed in 2012 to force the SEC to realign their mineral reserves reporting standards of IG7 with the rest of the mining world. Further, SME has submitted questions to the committee to ask during an April 29 SEC oversight hearing that SEC Chair Mary Jo White will participate, asking when her agency will address the competitive disadvantage to US mining companies.
On April 23, MSHA issued a final rule to lower miners' exposure to respirable coal mine dust in all underground and surface coal mines. The final rule, that will be phased in over a two year period, reduces the overall dust standard from 2.0 to 1.5 milligrams per cubic meter of air and cuts in half the standard from 1.0 to 0.5 for certain mine entries and miners with pneumoconiosis; requires immediate action when dust levels are high; requires more frequent sampling of areas known to have relatively high dust levels; changes the method of averaging dust samples; requires sampling for the full shift a miner works; for MSHA-collected samples, MSHA will issue a citation for any single, full-shift sample at or exceeding the citation level; requires dust samples to be taken when mines are operating at 80 percent of production; and improves medical surveillance of miners.
MSHA will hold field seminars in coal mining regions to provide a comprehensive review of the new requirements to underground and surface coal operators. Training will be provided to MSHA coal mine safety and health enforcement personnel within five weeks of the promulgation of the final rule. All training materials will be available on MSHA's website at www.msha.gov.
MSHA has released preliminary data for 2013 on inspections; violations; number of mines and miners; and fatality and injury rates for coal, metal and nonmetal, and all mining. The data shows that while the 2013 overall injury rate improved from the prior year to an historic low, fatality rates increased, driven by a high number of mining deaths in the 4th quarter of 2013 when 15 miners died. In total, there were 42 mining deaths in 2013. Of those 42, 20 occurred at coal mines (unchanged from the previous year) and 22 at metal and nonmetal mines, an increase of six from the previous year. Nine of the 22 metal and nonmetal deaths occurred in the 4th quarter. The number of deaths of mine contractors dropped to a record low of four fatalities, compared to five the previous year. The number of mines decreased from 14,093 to 13,708. The number of working miners also declined, from 387,878 to 374,069. For the third consecutive year, mining industry compliance continued to improve as MSHA inspectors issued 118,759 citations and orders in 2013, a 15 percent decline from the prior year. MSHA will release a final version of the calendar year data in July. As of April 16, there were 9 fatalities, three in coal and six in metal.
On April 9, House Education and the Workforce Committee Chairman John Kline (R-Minn) all but closed the door this Congress to mine safety legislation in response to the 2010 Upper Big Branch explosion. Panel ranking member George Miller (D-Calif.) introduced a pending mine safety bill, H.R. 1373, as an amendment to labor-related legislation during a markup. Despite protests by Miller, Republican panel leaders said the amendment, which would boost mine safety penalties and whistleblower protections, was not germane. Miller, who is retiring this year, has been a vocal proponent of increased whistleblower protections, making advanced notice that intentionally obstructs MSHA inspections and willful violations of mine safety standards that lead to miners' deaths a felony, and other amendments to the Mine Act. Time has now run out for substantive mine safety reform prior to mid-term elections in November. With Miller retiring, it is unlikely that a new Congressional champion of Mine Act reform will emerge anytime soon. "This amendment (Miller’s) reflects the same flawed belief that simply passing more legislation will protect miners," Kline said. "We believe a better approach is to build on the progress we've made through responsible and aggressive oversight, and that's precisely what this committee will do." Kline's statement conforms to previous comments by GOP leaders and the mining industry that calls for tougher enforcement by MSHA rather than a new law.
On April 14, in a 2-1 ruling, the U.S. Court of Appeals for the District of Columbia Circuit struck down a SEC rule that required companies to disclose whether “conflict minerals” in their products were mined in the Democratic Republic of the Congo. The federal appellate court ruled that the SEC's conflict minerals rule violated the First Amendment by requiring companies to state on their websites whether components of their goods "may have originated" in the DRC. Specifically, this aspect of the SEC’s Dodd-Frank Wall Street reform legislation sought to crack down on the use of gold, tantalum, tin and tungsten that armed militias sell to fund their operations. The U.S. Chamber of Commerce and the National Association of Manufacturers also challenged the rule’s lack of a de minimus exception for companies that used tiny amounts of those minerals. Further, they sought to strike down due diligence requirements for what a company must do to determine whether its products contain minerals that came from the DRC, as well as requirements forcing contractors to conduct similar diligence efforts. The court unanimously upheld all those aspects of the rule, which the SEC estimates will cost $3 billion to $4 billion initially and then $200 million to $600 million annually.
On April 8, the Senate confirmed Neil Kornze as the 18th director of the BLM. The 71-28 vote gives BLM its first confirmed director since 2012. Kornze, who has led BLM in an acting capacity for over a year, is a Nevada native. He came to BLM in January 2011 after spending several years as a public lands staffer for Senate Majority Leader Harry Reid (D-Nev.), a role that included helping pass a sweeping omnibus public lands package in spring 2009. As director, he will face tough policy decisions in finalizing a hydraulic fracturing rule, curbing methane emissions from well sites, amending millions of acres of land-use plans to protect the sage grouse and leading reforms to BLM's oil and gas program, including the upcoming launch of a nationwide online permitting system designed to trim industry wait times.
On April 8, in response to the potential Endangered Species Act (ESA) listing of the sage grouse, which would affect land development including mining, in 11 Western states, Rep. Mark Amodei (R-NV) introduced H.R. 4419, the Sage-Grouse and Endangered Species Conservation and Protection Act. The bill would require the federal government to fund a portion of conservation work before listing a species. As a funding mechanism, the bill would allow sales of 160 acres or less of public land to pay for conservation measures. The funds would be distributed to federal/state councils in states with 33 percent federal land or more. In the event of a listing, the bill would require a transparent review of the listed species, including cost benefit analysis and updated figures regarding habitat acres and species population. The legislation also extends protections to private land owners whose properties are designated as critical habitat. Any such designation that imposes restrictions on uses of land is deemed a regulatory taking of property for which fair-value compensation is required to be paid under the Fifth Amendment of the Constitution.
According to a report issued on April 2 by the American Chemistry Council's Rare Earth Technology Alliance, the REE industry, including mining and processing, generates $1.9 billion in economic activity a year in North America. The report said the REE industry directly contributes roughly $795 million in shipments and employs a little more than 1,000 workers. Even though the global REE market is controlled primarily by companies and countries outside of North America, the report's authors say momentum is on North America's side. "The overall trend is up. And we would expect it to jump even more," said Kevin Swift, ACC's chief economist. The report argues that each job within the rare earths industry helps sustain five more jobs elsewhere. The group gets to the $1.9 billion figure by adding up the direct, indirect and induced economic effects. Counting the products and industries that rely on REEs, the report finds that the industry helps support more than $300 billion in U.S. and Canadian economic output, including more than 600,000 workers.
Seven mining state Senators, including John Barrasso (R-WY) and Joe Manchin (D-WV), is urging the Obama administration’s Interagency Working Group on Improving Chemical Facility Safety and Security not to increase regulation of ammonium nitrate (ANFO), the chemical compound blamed for a fertilizer plant explosion in Texas last year. They worry that additional scrutiny will be an undue burden on mining operations, which rely on ammonium nitrate as a primary explosive. Additional regulation of ANFO is redundant to the existing rules under OSHA, MSHA, ATF and the Dept. of Homeland Security, according to the Senators. "There is no viable substitute for ANFO in the explosives industry, and without explosives mining, quarrying and other essential industries could not function," they wrote in the March 31 letter.
On March 26, the House passed H.R. 1459, a bill to curtail the president’s authority to designate national monuments that protect public lands from mineral development and other impacts. The bill would require the president to conduct a National Environmental Policy Act review before designating monuments more than 5,000 acres in size, while limiting presidents to one designation per state for each four-year term. The president could issue emergency proclamations for smaller monuments, but those would still require either congressional approval or a NEPA review within three years.
On March 24, Senator Heidi Heitkamp (D-ND) announced new major legislation that supports the development and implementation of technologies that reduce the carbon footprint of coal-fired power plants. The Advanced Clean Coal Technology Investment in Our Nation (ACCTION) Bill incentivizes utilities companies to invest in technologies that reduce the carbon footprint of coal-fired power. This is done through federal funding programs, federal support for private investment, and reports to Congress that provide recommendations on how best to support future carbon capture and sequestration projects in the U.S.
On March 25, the House of Representatives passed H.R. 2824, “Preventing Government Waste and Protecting Coal Mining Jobs in America.” This bill is aimed at stopping the Obama administration from re-writing coal mining regulations as they apply to the 2008 Stream Buffer Zone rule. Under the bill, coal operations would be allowed to dispose of mine waste near streams if regulators determine that avoiding disturbance of the streams is not reasonably possible. Under the existing rule the Office of Surface Mining is currently implementing, coal companies are prohibited from disposing of mine waste within 100 feet of streams.
On March 24, the U.S. Supreme Court declined to review a broad challenge to U.S. EPA's authority to retroactively veto Clean Water Act permits issued by the Army Corps of Engineers. Mingo Logan Coal Co., a subsidiary of Arch Coal Inc., challenged EPA's decision to veto parts of a Section 404 dredge-and-fill permit for their mountaintop-removal coal mine in Logan County, W.Va., four years after it was issued. By not taking up that challenge, the justices let stand a U.S. Court of Appeals for the District of Columbia Circuit ruling last April that upheld EPA's veto authority.
The federal Office of Surface Mining is making $298 million available in fiscal 2014 grant funding to states under the abandoned mine land (AML) grants. This years’ grants are almost $24 million lower than the fiscal 2013 total because of sequester spending cuts, lower coal production and other factors. The grants flow from coal industry fees and the Treasury and are determined through a formula last set in the 2006 amendments to the Surface Mining Control and Reclamation Act. Top recipients include Pennsylvania with more than $52 million, West Virginia with $51.8 million and Kentucky with $36.6 million for fiscal 2014. Wyoming gets $26.9 million even though the state is certified to have finished cleaning up its priority abandoned coal mine sites.
The Office of Surface Mining is proceeding with plans to implement the 1983 Reagan-era stream buffer regulation to protect waterways from coal mining in the wake of a court ruling last month that struck down the 2008 Stream Buffer Zone Rule. The U.S. District Court for the District of Columbia said the 2008 rule violated the Endangered Species Act because the Bush administration failed to consult with the Fish and Wildlife Service during its development. The OSM has only been enforcing the SBZ Rule in a limited number of jurisdictions, including Tennessee and Indian Country, that lack their own mining oversight programs. OSM is moving to comply with the court ruling and implement the 1983 guidelines, including preparing a notice to be published in the Federal Register. States with regulatory programs under the Surface Mining Control and Reclamation Act have already been working under the same 31-year-old rule. The Obama administration is in the process of developing the forthcoming Stream Protection Rule and wants that to be the national standard in the coming years. Environmentalists and OSM claim the 1983 rule is more protective of waterways while the National Mining Association, who may appeal the court’s ruling, sees the 2008 rule as being more protective.
The House Committee on Transportation and Infrastructure Chairman Bill Shuster (R-PA) and Ranking Member Nick J. Rahall, II (D-WV) announced the establishment of a special panel which will focus on the use of and opportunities for public-private partnerships (P3s) across all modes of transportation, economic development, public buildings, water, and maritime infrastructure and equipment. The full committee’s Vice Chairman, John Duncan, Jr. (R-TN), will chair the newly formed “Panel on Public-Private Partnerships,” and U.S. Rep. Michael Capuano (D-MA) will serve as the ranking member. The panel will examine the current state of P3s in the U.S. to identify: (1) the role P3s play in development and delivery of transportation and infrastructure projects in the U.S., and on the U.S. economy; (2) if/how P3s enhance delivery and management of transportation and infrastructure projects beyond the capabilities of government agencies or the private sector acting independently; and (3) how to balance the needs of the public and private sectors when considering, developing, and implementing P3 projects.
On March 6, the House of Representatives passed H.R. 3826, the Electricity Security and Affordability Act, by a vote of 229 to 183. Authored by Energy and Power Subcommittee Chairman Ed Whitfield (R-KY) and Senator Joe Manchin (D-WV), this bill would prevent EPA from finalizing its proposal to require carbon capture and storage technology for all new coal-fired power plants, and would make rules for existing power plants contingent on congressional approval. Ten Democrats crossed the aisle to vote for the bill, and Republican Reps. Jaime Herrera Beutler (WA), Chris Gibson (NY) and Frank LoBiondo (NJ) voted against it. The legislation would allow coal to remain a viable part of the U.S. energy mix by ensuring EPA adopts standards for new coal plants that are technologically achievable. As currently written, EPA’s standards for new coal-fired generation would require the use of control technologies that are not commercially available, constituting a de facto ban on new coal-fired plants. The legislation also provides that Congress would set the effective date for EPA’s greenhouse gas regulations for existing power plants.
On February 26, President Obama proposed a $302 billion, four-year transportation reauthorization bill that aims to avoid insolvency of the Highway Trust Fund, which is expected to run out of money as early as August if Congress fails to implement a solution. The bill would reauthorize the current transportation funding bill, Moving Ahead for Progress in the 21st Century (MAP-21), which will expire in September. The transportation bill would provide funding to states and local governments for transportation projects — two levels that need more support than MAP-21 has provided. It will also provide $63 billion to the Highway Trust Fund to help fill the funding gap and will include policies and reforms to prioritize “Fix-it-First” investments. Other investments included in the proposal are: $206 billion for highway funding and road safety; $72 billion for transit and expansion projects; $19 billion in high performance rail; and $9 billion in TIGER (Transportation Investment Generating Economic Recovery) grants and competitive funding. It is critical that Congress and the president find a Highway Trust Fund solution before the Federal Highway Administration is unable to reimburse states this summer for road and transit projects that have already been approved.
This report presents the results of the Fraser Institute’s 2013 annual survey of 4100 individuals in global mining and exploration companies. The survey is an attempt to assess how mineral endowments and public policy factors such as taxation and regulatory uncertainty affect exploration investment. Survey results ranked Sweden as the top political jurisdiction for mining and exploration, while the state of Alaska offers the best regional geology for exploration.
Musical chairs continues in the House of Representatives as House Natural Resources Chairman Doc Hastings (R-WA) announced he will retire at the end of the year after serving 20 years in Congress, including four atop one of the House's most influential panels on mining and energy policy. If Republicans keep their House majority, as expected, it will clear the way for new GOP leadership on the panel that oversees mining development on public lands. Future chairmen could include Reps. Louie Gohmert of Texas or Rob Bishop of Utah. As chairman, Hastings’ committee helped lead to the House passage of H.R. 761, the Critical Minerals Policy Act of 2013 – twice.
Senator Mary Landrieu (D-LA) will take over the chairmanship of the influential Senate Energy and Natural Resources Committee, as former chair Ron Wyden (D-OR) moves to chair the Finance Committee. Landrieu has long been close with fossil fuel producers, as Louisiana plays host to numerous oil and gas operations and ranks 17th in coal production that generates almost a third of the state's electricity. The Louisiana Senator has been a vocal skeptic of the Obama administration proposals to reduce power plant emissions and has expressed opposition to U.S. EPA's use of the Clean Air Act to regulate greenhouse gas emissions. Later this year, the Senate Energy and Natural Resources Committee will likely take up the controversial issue of coal exports from both the Pacific Northwest and from the Gulf Coast.
On January 28, the Electricity Security and Affordability Act, (H.R. 3826) authored by Energy and Power Subcommittee Chairman Ed Whitfield (R-KY) and Sen. Joe Manchin (D-WV), passed the full Energy and Commerce Committee by a bi-partisan vote of 29-19. The legislation offers an alternative to the EPA’s proposed greenhouse gas standards for new power plants and the agency’s planned regulations for existing power plants. The bill directs EPA to adopt workable standards for new coal-fired plants that require technologies that have been adequately demonstrated and are commercially feasible. It would also instruct Congress to set the effective date for EPA’s expected regulations for existing plants. The legislation allows coal to remain part of America’s energy mix, protects jobs, and ensures a diverse and affordable electricity portfolio. A similar version of this bill was introduced in the Senate on Jan 16 by Senate Minority Leader Mitch McConnell (R-KY).
A new report by the Associated Equipment Distributors claims that the construction equipment industry stands to lose $2.4 billion in revenue and roughly 4,000 jobs next year if the Highway Trust Fund runs out of money in 2015. California faces the largest potential revenue loss, at $226 million, followed by Texas, Florida and New York, the study found. The figures were based on fiscal 2015 allocations announced last October by the Federal Highway Administration. The Highway Trust Fund uses revenue from the federal gas tax to fund highway projects but is slated to become insolvent by 2015 due in large part to an increase in fuel efficiency and other auto industry improvements. Democrats and Republicans are split on how to fix the problem. Rep. Earl Blumenauer (D-Ore.) is backing a bill that would raise the existing 18.4-cent-per-gallon gas tax to 33 cents per gallon. Republicans favor lowering the gas tax to as little as 3 cents per gallon in some states. MAP-21, a 2012 surface transportation law, set $81.4 billion aside for the trust fund, but the law is set to expire in September. Earlier this month, the House and Senate began negotiations to reauthorize the law.
SME, and the American Geosciences Institute, have founded a new broad-based group of minerals and materials interests, called the Minerals Science and Information Coalition (MSIC), to advocate for reinvigorated minerals science and information functions in the federal government. The MSIC seeks to have Congress and the administration increase funding and support for federal minerals research, information gathering, analysis, and forecasting to sustain economic prosperity and ensure national security. Federal programs in minerals science, research, information, data collection and analysis have been severely weakened. Funding for the U.S. Geological Survey’s Mineral Resources Program, the only primary source for minerals science and information, has been cut by 30% in constant dollar terms over the last decade. The U.S. government currently has no capacity to forecast future trends in the supply of, and demand for, minerals and thus is unable to anticipate and mitigate disruptions in supply chains. Coalition members include trade associations, professional societies, and groups representing the extractive industries; geoscience, physical, chemical, and material science professionals; processors, manufacturers, and other mineral and material supply-chain users; state government; and other consumers of federal minerals science and information.
Sen. Maria Cantwell (D-WA) has called on EPA to issue a first-of-its-kind preemptive veto of the proposed Pebble mine in Alaska. On Jan 23, Cantwell headlined a rally in Seattle against the mine, along with dozens of fishermen and local celebrity chefs. In 2011, Cantwell became the first senator to call on EPA to consider invoking Section 404 of the Clean Water Act to veto key Army Corps of Engineers dredge-and-fill permits for the project. Even though the mine has yet to enter the formal permitting process, Cantwell cites EPA's newly completed watershed assessment as evidence of the necessity to intervene now. In a letter to President Obama, Cantwell urged the administration to file a notice in the Federal Register beginning the process to "prohibit or restrict the development of the Pebble Mine or similar large-scale mining activity in the headwaters of Bristol Bay.” Last year, the U.S. Court of Appeals for the District of Columbia Circuit ruled in favor of a retroactive veto for a West Virginia mining project. The agency has never used such a veto pre-emptively, however.
SME members Larry Meinert, U.S. Geological Survey mineral resources program coordinator; and Roderick Eggert, Colorado School of Mines professor, testified on behalf of their respective organizations at a Jan. 28 hearing in Washington, D.C. on critical minerals. The hearing, by the Senate Energy and Natural Resources Committee, is the first Senate hearing on critical minerals policy since the beginning of the 113th Congress. At issue will be legislation, S. 1600, sponsored by ranking committee member Lisa Murkowski (R-AK) and Chairman Ron Wyden (D-OR), plus a bipartisan group of Senators. The Murkowski bill would create a system for establishing a list of critical minerals. And it calls for studies of U.S. mineral resources and issues surrounding domestic mining. The hearing will likely touch on the causes of U.S. dependence on imports for a variety of minerals and whether the country needs to promote more mining. Advocates on the issue have also been concerned about the U.S. losing the knowledge and manufacturing base associated with these key minerals. The Murkowski bill would cost $60 million however it would be offset that cost by taking money from an unused biofuels grant program originally approved in the 2007 Energy Independence and Security Act.
Senate Minority Leader Mitch McConnell (R-KY) was joined by all but five Republican colleagues in introducing legislation on Jan. 16 to block EPA's proposal to limit greenhouse gas emissions from coal-fired power plants. The legislation is an attempt to stop the rule using the Congressional Review Act despite the fact that disapproval resolutions under that act, such as this legislation, are typically applied only to rules that have been finalized and submitted to the Government Accountability Office -- neither of which has happened here. McConnell has been vocal in accusing the administration of proposing the rule in an effort to eliminate the use of coal-fired electricity and wreak economic ruin on the coal miners in his district. The rule would require the use of carbon capture and sequestration technology that is expensive and arguably untested on a commercial scale.
Senators Tom Harkin (D-IA)and Jay Rockefeller (D-WV)and Rep. George Miller (D-CA), who have been among the most vocal supporters of new mine safety legislation in response to the 2010 Upper Big Branch explosion in West Virginia, announced their retirements from Congress at the end of 2014. Democrats were unable to pass mine safety legislation immediately after Upper Big Branch when they controlled both houses of Congress. Many lawmakers wanted to wait for investigators to finish probing the incident. Since then, Rockefeller has blamed Republicans and strong coal industry lobbying for effectively stalling any move toward new mine safety laws. A bill pending in the House has 30 co-sponsors, while the Senate version has only five supporters. Neither bill is expected to pass. After the Upper Big Branch disaster, Miller, who serves as ranking member of the Education and Workforce Committee, was strongly critical of some mining companies' using the violations appeals process to ward off increased scrutiny by MSHA and has pressed for tougher industry oversight by MSHA. Lawmakers have worked to keep funding relatively stable for MSHA amid budget cuts. The proposed fiscal 2014 omnibus spending bill sets aside $376 million for the agency, below President Obama's request but comparable to current levels.
On Jan. 15, EPA issued its final watershed assessment of the proposed Pebble mine in Alaska. The report claims the mine would create significant risks for the local salmon fishery and tribal communities that depend on it. The final watershed assessment offers a scathing critique of mining in the watershed, saying a mine, such as Pebble, would destroy between 24 and 94 salmon streams and 1,300 to 5,350 acres of wetlands, ponds and lakes. Under normal operations, a large-scale mine would have direct and indirect impacts on fish in 13 to 51 miles of streams, the report says. EPA also predicts problems stemming from road and pipeline pollution. EPA said it prepared the assessment in response to concerns about the potential Pebble mine from several Alaska tribes. The tribes want the agency to use its Clean Water Act veto power to block key mining permits and protect the local sockeye salmon fishery. EPA said today that it will now begin looking at how to respond to the tribes, although no time frame has been established. There is obvious concern by the mining industry that EPA may issue a preemptive veto of the project that would set significant precedent for future mine development projects.
A rider in the omnibus spending bill released Jan. 13 would roll back but not block the Obama administration's limits on funding overseas coal projects. At issue are guidelines approved in December by the U.S. Export-Import Bank -- a government entity that's supposed to promote U.S. exports -- that would block funding for coal-fired power plants unless they are equipped with carbon capture technologies or "no other feasible alternative exists" in poorer countries. The omnibus includes a provision that would prevent the Ex-Im Bank from acting "when enforcement of such rule, regulation, policy, or guidelines would prohibit, or have the effect of prohibiting, any coal-fired or other power-generation" for certain poor countries. The spending measure would also prohibit the lenders from blocking, or pursuing policies that have the effect of blocking, plants that "increase exports of goods and services from the U.S. or prevent the loss of jobs from the U.S." A summary of the legislation says, "This provision is expected to increase affordable electricity, especially to those without current access to electricity, as well as to support increased exports from the United States and prevent the loss of United States jobs."
On January 14, the Federal Mine Safety and Health Review Commission overturned a decision by Administrative Law Judge Jerold Feldman involving Wolf Run Mining Co.’s Sago Mine in Upshur County, W. Va., where 12 miners died in an explosion Jan. 2, 2006. The commission found that the mine operator’s failure to notify MSHA and mine rescue teams immediately after the explosion involved unwarrantable failure and high negligence. On appeal, a two-member commission majority held, in agreement with MSHA, that the ALJ erred because he: (1) miscalculated the time at which the mine operator’s duty to report commenced; (2) treated the intentional nature of the operator’s failure to report as a mitigating factor; (3) treated the fact that the explosion occurred on a federal holiday as a mitigating factor; and (4) failed to consider the fact that, when the operator finally attempted to report the explosion, it relied solely on an off-site management official who had limited knowledge of the explosion and limited information and resources available to him at home. In addition to reinstating MSHA’s unwarrantable failure and high negligence designations, the commission assessed the company with MSHA’s proposed penalties of $1,500 and $13,000 for two separate citations.
President Obama has nominated Dr. Suzette M. Kimball to serve as the Director of the USGS. Kimball has led the agency in an acting capacity since February 2013. If confirmed by the U. S. Senate, Kimball would lead the science agency of more than 8,000 scientists, technicians and support staff in more than 400 locations across the U.S., with a budget of $1.1 billion. The USGS Director also serves as Science Advisor to the Secretary of the Interior, overseeing activities of the Department’s Strategic Science Group and chairing the team of nine bureau science advisors. Before assuming the USGS Acting Director position last year, Kimball served as the Deputy Director from 2010 to 2013; as the Associate Director for Geology from 2008 to 2010; as the Director of the Eastern Region from 2004 to 2008; and as the Eastern Regional Executive for Biology from 1998 to 2004. She was previously Acting Director from January to November 2009. She has also USGS’s international activities and represented all North American geological surveys on international mapping endeavors. Kimball received a Ph.D. in Environmental Sciences/Coastal and Oceanographic Processes from the University of Virginia; an M.S. in Geology/Geophysics from Ball State University; and a B.A. from the College of William and Mary.
Preliminary data released by MSHA indicates that in 2013, 42 miners died in work-related accidents, up from 36 mining fatalities in 2012. Of those fatalities, 20 were in coal mining and 22 were in metal/nonmetal mining, compared with 20 and 16, respectively, in 2012. Of the total mining deaths in 2013, fourteen occurred in underground coal and an additional six at surface coal operations. In metal/nonmetal mining, five deaths occurred underground, and 17 occurred at surface operations. The most common causes of mining accidents in 2013 for both coal and metal/nonmetal involved machinery and powered haulage equipment. West Virginia had the most coal mining deaths, with six, and Kentucky had the most metal/nonmetal mining deaths, with four. Nine states experienced coal mining deaths and 14 states had deaths at metal/nonmetal mining operations. MSHA has completed an analysis of these mining fatalities along with best practices and recommendations to include in new miner training.
The House Natural Resources committee will hold a hearing on Jan 9 regarding a report issued in late December from the Office of Surface Mining's inspector general showing OSM changed the method of calculating the economic impacts of an early version of the forthcoming stream protection rule after contractors warned of thousands of job losses. The oversight hearing is part of its two-year-long investigation into the rewrite of the Bush-era stream buffer zone rule. Pro-coal lawmakers have categorized the rulemaking as part of Obama administration's war on coal. While the IG report found that OSM directed contractors to change the variables in their economic assessment to ones "they knew" would lower the potential job-loss numbers, it did not accuse the agency of improperly downplaying the economic impacts of the rulemaking. It also found that, although OSM only began to seriously consider terminating the contractor after job loss numbers were leaked in 2011, "interviews and internal communications indicate that OSM's dissatisfaction with contractors' work product and overall performance occurred well before then."
On December 26, president Obama signed into law a fiscal 2014 defense authorization bill with rare earth element stockpiling provisions. The National Defense Authorization Act (NDAA), which passed in the House and the Senate just before the holidays, authorizes the stockpiling of certain minerals important to military capabilities. The bill, a recently crafted bipartisan compromise meant to ensure passage, also allows the Pentagon to promote the domestic availability of materials like rare earth elements. The mineral provisions are seen as a win for advocates in the House who inserted similar provisions in their version of the NDAA. The original Senate bill had none. The law authorizes up to $41 million between 2013 and 2019 to acquire certain varieties of the following strategic and critical materials required to meet the defense, industrial, and essential civilian needs of the U.S.: niobium, dysprosium, yttrium, tellurium, lithium, certain high explosive molding powders.
On Dec. 12, the U.S. Energy Information Administration issued its final 2012 annual coal report that provides data on U.S. coal production, number of mines, productive capacity, recoverable reserves, employment, productivity, consumption, stocks and prices. Highlights for 2012: U.S. coal production decreased 7.2 percent from 2011,