Wednesday, November 20, 2013

Augusta Resources' Rosemont mine gets the hatchet job from the EPA, or so the environmentalists would have you think (UPDATED)

(Update at the bottom)

IKN - Augusta Resources

Where he quotes this:

TUCSON, Ariz., Nov. 20, 2013 /PRNewswire/ -- The U.S. Environmental Protection Agency has dealt a dramatic and potentially devastating blow to Augusta Resource Corporation's proposal to build the Rosemont mine, a massive open-pit copper mine in the Santa Rita Mountains just south of Tucson.

In a Nov. 7 letter to the U.S. Army Corps of Engineers, the EPA recommended that the proposed Rosemont copper mine should not receive a permit that would allow the company to dump potentially toxic mine wastes into area waterways.

After completing a comprehensive and detailed analysis, EPA concluded that Rosemont's proposals to mitigate the mine's severe and permanent damage to area water supplies are "scientifically flawed" and "grossly inadequate," and advised the Corps of Engineers that the project "should not be permitted as proposed."

The EPA's recommendation to deny Rosemont's permit application is a potentially devastating blow to the mining project because EPA has veto authority over the permit, which would be issued by the Corps of Engineers only if the proposed mine meets Clean Water Act standards. The permit is required before construction could begin on the mile-wide, half-mile deep open-pit mine.

Now, having done the tiniest bit of PR in my life, some questions immediately sprung into my head when I wrote this:

1. Um, this language doesn't sound like the type of NR that Augusta would put out, does it?
2. So, who put out the NR?

So I followed the link and saw this at the bottom:

For more information go to:
The full EPA letter and analysis can be downloaded at:

Ha ha! I remember Scenic Santa Ritas! This NR was obviously meant to be a kill-shot from the environmentalist organization who opposes the Rosemont mine.

You can tell, because further on in their NR you get this:

EPA's recommendation to deny the Clean Water Act permits comes at an inopportune time for Augusta Resource, Rosemont Copper's parent company. Its stock is hovering at a 52-week low and the company reported less than $750,000 in cash reserves as of Sept. 30, according to regulatory filings released last week.

Augusta's cash crisis raises serious questions as to whether Augusta will have the financial capacity to secure technical expertise to address EPA's latest criticisms of the crucial Clean Water Act permit.

Man! Either these Scenic Santa Ritas people are some hardcore commie pinkos bent on destroying all capitalism, or AZC has pissed them off royally in the past and now SSR really wants to put the boots in.

I.e. this ain't just a victory drum-circle: they've put out this NR purposefully to cave AZC's stock price.

Anyway, at least they provide a link to a pdf scan of the actual EPA letter, so you can read it yourself.

Now, I have peripheral experience in enviro approvals (watching co-workers, basically), but I have no experience in enviro approvals specifically for mining. It seems, from reading this, to be the sort of game where you don't even know where the goalposts are unless you're an experienced mining consultant who has done enviro work before, in this case specifically with the Army Corps of Engineers and the San Francisco office of the EPA, again specifically concerning impact mitigation.

So without that requisite experience I really have no way of providing any intelligent comment on this EPA kibosh. It does seem funny that a 7000 acre (11 sq. mi) half-mile-deep open pit copper mine can get the chop because of 18 miles of streams. Then again, like I said, I've never gone through this process.

And I'm not interested in reading about it tonight.

You'd think AZC would have hired a competent environmental consultant to do all the work and write the report, no? And, being told by the competent consultant that approval requires X amount of mitigation at approximately $Y hundred million dollars, they'd have said "sure, whatever it takes", right?

Oh well. No clue what happened.

I just found the NR funny. Be scared, junior miners: more NGOs are going to start playing this negative NR game in the future, I think.

UPDATE: Ok, now I just saw this:

Yahoo Finacne - Augusta comments on the bullshit NR from the commie pinko environmentalists.

Where Gil Clausen says:

"The SSSR press release today was not only inaccurate but another attempt to harm our company. This group has historically mischaracterized the level of impact that letters between agencies have and obviously do not understand the permitting or the evaluation process. SSSR totally misrepresents the contents of the letter and the EPA's comments actually said that they were looking forward to working with the Army Corps on mitigation and risk based assessments. For example, nowhere in the EPA's letter did they discuss discharges as 'toxic mine wastes'. The SSSR is fabricating information and attributing that information to EPA in an effort to scare our shareholders and disrupt markets."

And then the NR says, emphasis mine:

The Company states the EPA has been working diligently with the U.S. Forest Service (USFS) and other Federal Agencies to finalize the work required to complete the permitting process. The EPA letter refers to old plans and issues which were the basis of discussion and not decision. The ACOE will make their decisions based on facts, rules and regulations as they continue to maintain good dialog with the EPA.

The final EIS has integrated five years of science based technical studies and analysis and is due out next week, and the printed version of the draft Record of Decision (ROD) from the USFS is expected to be issued mid-December after the documents are printed. When these two printed documents are released, the EPA will be able to work with other agencies and with Rosemont to finalize mitigation planning and to assure compliance with all regulations and permit conditions regarding the 404 Permit issued under the Clean Water Act.

Additionally the references to scientific flaws are from a letter written almost a year ago and acknowledged that the assessment methods were what was prescribed by the ACOE and references a mitigation plan that is out of date and not currently in use. The EPA does not determine appropriate mitigations, this is the ACOE's responsibility.

Rosemont has developed a comprehensive environmental, social and cultural mitigation program with detailed monitoring and reporting protocols to address the concerns and requirements of numerous agency and permit requirements under the National Environmental Policy Act and the Clean Water Act 404 processes.

This mitigation program addresses, and goes well beyond, the EPA's comments on the approximately 65 acres of direct and indirect impacts to dry washes and waters of the US that are under review by the Army Corp of Engineers for the 404 jurisdictional mitigation.

Rosemont will continue working with all of the regulatory agencies as the thorough permit review process comes to conclusion in early 2014.

And Gil finalizes,

"Rosemont has been working closely with the Federal Agencies for the past five years to ensure the appropriate mitigations are developed to address impacts. Throughout that time, the SSSR has consistently and purposely misrepresented the company's intentions, the facts and the NEPA process. They have deliberately worked to undermine the obligations and work of the Agencies involved."


#1, what a silly schoolyard spat.

#2, if Clausen is correct, then he should have already spoken to a lawyer to get a case started against SSSR. I mean, if the NR really was a lie, and it's now affected AZC materially, then someone's on the hook for a few hundred million in damages, no?

#3, anyone want to go long this at the open tomorrow?


  1. Wonder if SSR or 'related' party shorted.

    1. Hippies don't have money.

      AZC's up after hours, but SSR might still be open to a class suit from the people who sold, if it truly was disinformation.

  2. I will wait for my testical enhancing cream to arrive before jumping in