Investment

San Juan County copper mine closes, leaving behind unpaid workers and environmental fears

(Zak Podmore | The Salt Lake Tribune) Heap leach platforms at the Lisbon Valley Mining Company copper mine facility in eastern San Juan County in October 2019. The mine abruptly shut down on March 18, 2020, triggering an emergency order from the Utah Oil, Gas and Mining Division.

No case of the coronavirus had been confirmed in San Juan County on Tuesday, but the epidemic has already taken its first economic victim in southeast Utah.

The Lisbon Valley Mining Company (LVMC), which operates Utah’s second-largest copper mine 35 miles southeast of Moab, closed abruptly last week. About 65 employees were laid off on March 18 and paychecks due two days later have not been deposited.

In a statement obtained by the Salt Lake Tribune, the company said “global economic turmoil” led to the collapse of a loan the company was due to close on March 13 and that attempts to find a bridging loan were emergency failed. As a result, management said they did not have enough funds to pay workers.

“We are working diligently to liquidate assets as quickly as possible and fund our payroll,” company executives said.

The mine includes nearly 1,000 acres of heap leach platforms where an acidified solution is distributed over crushed rock to remove copper deposits, and it requires near-constant maintenance to comply with environmental regulations.

On Friday, the director of the mining company, George Shaw, sent a letter to the Utah Oil, Gas and Mining Division (DOGM), requesting “immediate assistance.”

He said a number of employees have continued to volunteer since the March 18 holiday to prevent operations from collapsing. But, he added, workers were “exhausted after several days of little or no sleep and are devastated by the sheer steps the company has demanded over the past few days.”

Shaw also said the freezing temperatures had broken several pipes carrying an acidified solution and called the situation “very fragile”.

In response, DOGM Director John Baza on Friday signed an emergency order requiring LVMC to begin containment and reclamation efforts “to the extent necessary to immediately prevent any imminent threat of environmental damage.”

The order called the mine conditions “vulnerable” and said they “could quickly deteriorate”, adding: “DOGM understands that failure of the leach pad and ponds pumps will result in a release. sulfuric acid into the environment after only 37 hours. “

According to documents deposited on the DOGM website, the mining company holds a bond of $ 6.1 million with the surety company Sompo International as required by state law to ensure funds are available for reclamation if a mining company does not comply with its license.

“If Sompo does not take immediate action to ensure that the environmental damage is mitigated,” the order continues, “DOGM will take urgent action to lose the full amount of the bond.”

State agency inspectors were dispatched to the mine site on Monday, and a spokesperson for DOGM said the inspectors outlined the steps needed to protect the environment.

“The management of the division demanded that all work be stopped only [or] related to reclamation and nothing for production, ”the spokesperson said, adding that a plan for the safe decommissioning of the facility was being developed with a contractor.

The contractors are currently working without pay and have said they will continue as long as possible. They stressed to inspectors, however, that it would be “difficult to maintain their environmental protection measures if they cannot pay for supplies, fuel and wages.” The state has not ruled out the possibility of intervening as a palliative until the entrepreneurs can be financed by the surety.

A reclamation plan filed with DOGM in February indicates that it could take up to 10 months to neutralize the acid in the heap leach pads, followed by up to 16 months of drainage and evaporation of the heaps. installation basins. According to the company’s estimates, the process will use 664 million gallons of water over four years, which will be drained and actively evaporated.

LVMC has long experienced financial difficulties and did not pay property taxes to San Juan County between 2015 and 2019. In October, Shaw asked the San Juan County Commission to agree to a 36-month payment plan for the more than $ 1.1 million the company owes in back taxes.

The county agreed to waive $ 250,000 in penalties despite the tax hike in December to bolster its own general fund. The payment plan was to extend until 2022.

At the October meeting, Commissioner Bruce Adams asked what would happen if the company had difficulty making its monthly tax payments.

“We will be back here,” Shaw replied, referring to the county commission chambers and adding that the company would be in serious financial trouble if that happened. The company did not respond to a request for comment.

Before closing its doors last week, the company was seeking to expand its operations and run a pilot in-situ mining program, which involves pumping an acidified solution directly into the water table and dissolving the copper from the underground rock.

“We are investing … millions and millions of dollars to develop technology that eliminates the need for surface mining … and [that] could benefit the entire industry globally, ”said Alysen Tarrant, LVMC’s environmental manager, at a briefing in Monticello in December.

DOGM’s emergency ordinance remains in effect until its next regular council meeting, currently scheduled for April 22. The March board meeting was canceled due to coronavirus concerns.

Zak Podmore is a Report for America corps member and writes about conflict and change in San Juan County for the Salt Lake Tribune. Your matching donation to our RFA grant helps her continue to write stories like this; please consider making a tax deductible donation of any amount today by clicking here.

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