Inside the mining mind

Given the dismal state of mining in Nevada, Debbie Laney worries that her son, serving with U.S. military forces in Kosovo, won’t have bullets for his guns. Or guns for his bullets.

“Without mining, the United States will weaken,” Laney, president of the Women’s Mining Coalition and chief metallurgist at Barrick Goldstrike Mines Inc., testified at Friday’s Congressional Field Hearing on the effects of federal mining policy. “Without a strong mining industry, we can’t be No. 1. We can’t be the world power that we are.”

U.S. Congressman Jim Gibbons, co-chairman of the Congressional Mining Caucus, sympathized with Laney.

“Your son and his ability to protect this nation are important to us,” he said, with a concerned smile.

From rural politicians to the presidents of mining companies, almost all of the speakers April 20 agreed that three-month-old environmental regulations on mining have brought sorrow and woe and all things bad to Nevada.

On Jan. 20, the Bureau of Land Management’s new, improved “3809” regulations kicked in. The BLM’s goal? “To protect public health, public land resources and the environment [by ensuring that] mining operators, rather than the nation’s taxpayers, bear the costs of reclaiming mined lands.” That’s what the BLM said in November, back when the agency believed that it was a bad thing for a mining operation to go belly up and walk away from a site, potentially leaving a large portion of clean-up costs to the public.

Now under new management, the BLM wants to suspend those rules. Mining companies think exploring new sites in Nevada is too risky, warned Charles Jeannes, an executive at Reno-based Glamis Gold. Glamis now spends all of its exploration budget in Mexico and Central America.

“The political risk there is less than the permitting risk in the United States,” Jeannes said. The permitting process for a Glamis mine in Honduras took only a fraction of the time it would have taken in the United States. “The huge difference is that there is a desire among bureaucrats there to move it along and get it done.”

This scares rural Nevadans. In Humboldt County, the school district recently had to boot 75 employees to make ends meet. In Elko, families are walking away from homes that can’t be sold. Quoting a BLM prediction that the new regulations—one panelist nervously stumbled and called them “irregulations"—could cost another 3,200 jobs in Nevada, many agreed that the worst is yet to come.

But would more lenient regulations and fewer permit fees really boost mining in Nevada? Decreased levels of mining in Nevada are simply the result of low metal prices, said Tom Myers, director of Great Basin Mine Watch, a group that supports the new regulations.

"In fact, if regulations actually do reduce production—which, in our opinion, is a dubious outcome—the supply decrease should increase prices," Myers said. "If gold ever returns to $400 or $600 an ounce, the massive increases in exploration and production in Nevada will eliminate all of the industry’s concerns about fees and regulations."