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Pogo water permit remains on hold State wants meeting of parties, workers being sent home, local labor unions to protest at environmental group’s office Patricia Liles Petroleum News Contributing Writer
Lawyers representing the U.S. Environmental Protection Agency’s Region 10 branch in Seattle have until May 5 to prepare a response brief that would request dismissal based on technical defects of an environmental group’s appeal of a federal water discharge permit for the Pogo gold project. Developers of the gold deposit 40 miles northeast of Delta Junction, Alaska, received the EPA water discharge permit on March 15, effective April 16.
A Fairbanks-based environmental group filed a permit appeal with EPA’s Environmental Appeals Board in Washington, D.C., received on April 19. Because the permit is for a new facility and a new water discharge, “the applicant shall be without a permit for the proposed new facility pending final agency action,” the Northern Alaska Environmental Center said, citing federal regulations, in their 22-page appeal. “The filing of this Petition renders the applicant without a permit as a whole.”
EPA’s Region 10 assistant region counsel Keith Cohon estimates the entire cycle of the administrative appeal can range from four months to a year. Either side not satisfied with the decision of the appeals board can then file a lawsuit with the Federal Court of Appeals, then to the U.S. Supreme Court.
Pogo’s developers, a joint venture called Teck-Pogo Inc., formed by Teck Cominco and Sumitomo Metal Mining Co., have begun to stop work at the remote site, which began in February with ice road construction and operation. No mine or mill construction work has begun — about 300 workers have been preparing the site, the temporary worker camp and clearing the 50-mile all-season road route.
So far, 80 workers have been laid off, said Karl Hanneman, Teck-Pogo’s manager of public and environmental affairs and special projects. “We are working on a shut-down plan that will be implemented in the next two weeks,” he said on April 28. A skeletal staff will remain on-site to ensure existing land disturbance is stable through the spring thaw. Construction work was expected to peak this summer and in 2005 with more than 500 workers on the project. Now, those plans are on hold until the appeal process is complete. State wants to meet Teck-Cominco has already spent $5 million on capital spending at Pogo this year, said David Thompson, deputy chair and CEO of Teck Cominco, during an April 27 investor conference call about the company’s first quarter report. If Pogo remains on hold this year that could cut $50 to $55 million from the company’s $175 million capital spending budget for 2004.
“We’re still hoping for some sort of resolution and we have accepted an offer from the governor, a request to meet with the state, EPA and the Northern Center to discuss the course of the appeal,” Thompson said. State officials were still trying to set a date and place for that meeting at press time. Ed Fogels, project manager for the Alaska Department of Natural Resources, said they hoped to hold the meeting during the first week of May. “We are working toward setting up a process that could lead to a quick resolution,” Hanneman said, about the planned meeting. “We’re working through the governor’s office to see how to establish a process that would lead to their withdrawal of the appeal and let us return to work.”
During his presentation to investor analysts, Thompson said that should the EPA permit be withdrawn or amended, it would then require another review through the environmental impact statement process, already proven to be a lengthy process. “We have to have that permit to work,” Thompson said. “The only way to expedite is if the EAB decided not to hear it and awards us the permit. Then it is open up to the courts.”
Teck-Pogo submitted to state and federal regulators its plan of operation to develop the underground, hard rock gold mine in August 2000. The final environmental impact statement, with the regulatory agencies’ preferred alternative for development, was released in September 2003. State permits were issued in December, and the U.S. Army Corps of Engineers wetlands permit was issued in January.
A technicality involving recently modified state water quality standards, which were changed to mirror federal standards, held up until March 15 EPA’s National Pollutant Discharge Elimination System permit, which the Northern Center is contesting. Next step for appeal Cohon, as EPA’s lawyer handling the permit appeal, has until May 5 to file a brief that would argue the appeal be dismissed, based on technical faults of the filing. He declined to say whether that route would be taken. “I can’t tell that, not at this point in time,” Cohon said on April 27. “We’re still working on our legal analysis.”
A technical dismissal of the appeal could be made if issues were not previously raised during public comment periods. Previously, state regulators said the Northern Center’s appeal issues had not been previously raised. Now, they say that some of the appeal issues raised are new, while others have been previously discussed in some form. If EPA chooses not to request a technical dismissal, then Cohon is required to prepare a brief for the Environmental Appeals Board, due May 20, that would contain EPA’s response to the environmental challenge of the permit. “It would probably say something like, ‘We think we’re right (in issuing this permit) and present our case,” he said. “We don’t do permits if we don’t think it is right.” Environmental group takes heat While the appeal process continues, the environmental group that filed the appeal is taking heat from state regulators and local labor groups for its action.
“They’re coming in at the end of a three to four year process and their comments are basically saying, ‘Start over,’” Fogels said. “Here the environmental group has had a good example of a chance to work with the agencies to steer development in the right direction. I’m hopeful the Northern Center will see they’re off base and withdraw the appeal.” Local labor unions, who have had members laid off from Pogo, are also upset about the appeal. John Brown, business agent for the Operating Engineers Local 302, said some were planning to protest in front of the Northern Center’s College Road offices on April 29.
“They’re seen as obstructionists and they’re totally alienating themselves,” he said, on April 27. “I think it will hurt them in the long run.” His union had 85 members working on the project, some starting back in February. Ten have already been laid off. “They took these jobs, thinking they would be there all season. Now they’re coming back and are at the bottom of the out-of-work list,” Brown said. “My guys are out of work and they’re not happy.” Appeal claims have no validity The environmental group’s claim of potential discharges and seepage has no validity, Fogels said, describing the water collection and discharge plan as a “closed system.”
Another issue, claiming that water flowing from a tailings or rock pile into a recycle tailings pond should meet clean water standards, is not practical.
“The only point for that pond to be there is to hold water, either for the mill processing, or to be treated and released,” Fogels said. “Water going into it cannot meet clean water standards.”
Another issue of requesting that off-river treatment ponds be lined was not raised during public comment periods, he added. The EIS concluded that lining the recycle tailings pond or the tailings pile was not advisable. “Saturation caused by the impervious liner likely would increase stability risk” to the tailings dry stack, the regulatory agencies concluded. The liner would add little benefit to water quality, they added. Similar risk issues were associated with using a liner under the recycle tailings pond, the EIS said, concluding that an unlined pond was the preferred alternative.
“If you cannot do what they are planning to do in this permit, it could hinder future mineral resource development nationwide,” Fogels said. “It could be the first salvo in a much bigger deal.”
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