Copper Mineral Lease Not a “Project” Under Environmental Review Rules
Posted on October 4, 2013
On September 9, 2013, the Minnesota Court of Appeals issued a decision involving some familiar players in Minnesota’s emerging copper-mining industry. The court affirmed a determination by the Minnesota Department of Natural Resources (DNR) that no environmental assessment worksheet (EAW) was required in connection with the agency’s sale of mineral leases in Aitkin, Lake, and St. Louis Counties. In re Environmental Assessment Worksheet for 33rd Sale of State Metallic Leases in Aitkin, — N.W.2d —-, 2013 WL 4779044 (Minn. Ct. App. 2013). The DNR made its decision in response to a citizen petition requesting an EAW under Minnesota’s Environmental Policy Act (MEPA). Minn. Stat. ch. 116D; Minn. R. 4410.1100. After DNR declined to order an EAW, the citizens, lead by environmentalist attorney Paula Maccabee of Just Change Law Offices in St. Paul, appealed to the Court of Appeals.
Two of the successful bidders on the DNR leases, DMC (USA) LLC and Encampment Minerals, Inc., intervened in the appeal. DMC owns 40 percent of Twin Metals Minnesota LLC, which is developing an underground mine on a massive copper-nickel-platinum-palladium-gold resource near Babbitt Minnesota, on the northern edge of Minnesota’s Iron Range. For more info on copper mining in Minnesota, check out this useful overview on the DNR’s website.
The court affirmed the DNR’s decision on a very simple basis: this particular sale of mineral leases did not constitute a “project,” which is a threshold determination under MEPA. (E.g., a successful citizen EAW petition must demonstrate that a proposed project may have the potential for significant environmental effects.) The relevant rules define “project” as “a governmental action, the results of which would cause physical manipulation of the environment, directly or indirectly,” Minn. R. 4410.0200, subp. 65, and the court cited previous cases holding that “project” for purposes of MEPA is “a definite, site-specific, action that contemplates on-the-ground environmental changes, including changes in the nature of the use.”
Although the DNR leases contemplated the possibility of on-the-ground physical changes to the environment, the court found the contemplated changes too indefinite to bring the leases within the meaning of “project.” For example, the locations of any particular future activities were not yet ascertainable because the sites in question covered a vast area, and it was unknown whether any of the lessees would actually conduct invasive exploratory activities or mining on the leased sites. If, however, the lessees and DNR were to develop more specific exploration plans, these plans, the court held, depending upon their nature and extent, could well constitute a “project” under MEPA. Which means… before long, this matter could very well be back before the court.