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Biden All Set To Pro mote Minerals, However, Lag In Mine Permits
THE LEAD
As per BLM data, as of late June, that total is noticeably lower than during the final 3 years of the Trump administration, when the number of mines allowed ranged from 21 in 2020 to 29 in 2018. The BLM only moves forward with mine plans after receiving all the necessary permissions from the bureau and other organizations like the EPA. Mine plan approvals allow for the start of digging.
Biden All Set To Promote Minerals
However, Lag In Mine Permits
However, his administration only permits a small number of new mines on public land, despite President Joe Biden's recommendations for developing a U.S. supply chain to get the metals required for the energy transition.
The Biden presidency has been not so good news for some large, prominent mine projects in the United States, putting the brakes on or halting plans for the Pebble mine close to a prime salmon fishery in Alaska, the Twin Metals mine close to the Boundary Waters wilderness in Minnesota, and a titanium mine near the Okefenokee Swamp in Georgia.
The federal government, though, is likewise taking its time with smaller mining operations. The majority of mine permits on federal lands are administered by the Bureau of Land Management, which has formally approved 20 mine plans: six so far this year and 14 last year.
As per BLM data, as of late June, that total is noticeably lower than during the final 3 years of the Trump administration, when the number of mines allowed ranged from 21 in 2020 to 29 in 2018. The BLM only moves forward with mine plans after receiving all the necessary permissions from the bureau and other organizations like the EPA. Mine plan approvals allow for the start of digging. www.skillings.net | 9
THE LEAD
The BLM data doesn't only show a decline in mine permits following the change from a Republican to a Democratic administration. Additionally, fewer mine plans were approved under the Trump administration than they were during the four years of the Obama government.
Simply put, mining companies are less keen to delve into federal property. Since 2011, the number of applications has decreased practically every year, indicating that there are more factors at play here than just the president and political party in power. Compared to the 72 applications it received in 2011, the BLM only received 32 new mine application requests last year.
Over the past decade, fewer federal mine permits have been granted
It's a concerning development for a country that is desperately attempting to secure its own mineral resources and wean itself from the supplies provided by geopolitical rivals like China and Russia.
The Biden administration has supported a Trump-era program to increase domestic production of "critical minerals," a collection of 50 metals that are vital to the economy and national security of the country but are mostly mined and produced elsewhere.
In his message on climate action, Biden has included this policy. For instance, lithium, cobalt, nickel, manganese, and graphite supplies are crucial for producing electric vehicles. However, the Chinese industry dominates the global supply chain for all five of these metals.
The United States may have considerable potential for producing these EV metals. Nevada has enormous potential for lithium and is seeing a surge in lithium development. A business in Idaho is attempting to mine the "cobalt belt" of the state. Others in Alaska are interested in developing a coastal graphite deposit that may be one of the largest in the world, which would be advantageous for American battery manufacturers.
However, extracting these elements frequently necessitates a protracted environmental review at the federal level. There may be disharmony between the need for metals to be obtained as soon as possible for climate action and strict environmental protection laws in the United States because the deposits are found on federal lands, are close to endangered species, or pose a risk to protected natural areas like wetlands.
And when Biden took office, it appeared like investing in minerals was a good idea because organizations like the International Energy Agency anticipated a sharp increase in metal consumption as a result of the move away from fossil fuels. This could get worse in the United States because a crucial tax credit for electric vehicles is tied to utilising domestic minerals under a clause of the climate funding plan that the Senate passed.
An argument that could soon take center stage is whether this nation takes excessively long to approve mines, as the industry claims, or is prudently strict with projects that could irrevocably ruin landscapes, as environmentalists contend. Sen. Joe Manchin of West Virginia required the Senate to enact a separate "suite of basic permitting reforms" this fall as part of the reconciliation agreement he reached with Democratic leaders on a climate and health care package.
It's unclear how exactly this legislation will work out. Still, Manchin, last week, released a list of ideas he wants to be taken into account, including time limits on environmental reviews, revisions to Section 401 of the Clean Water Act permitting, and the explicit oversight of mining projects by a federal permitting council.
According to representatives of the mining sector, investors' interest in funding mine development has decreased as a result of the legal challenges to notable projects like the proposed Twin Metals copper mine and the permission backlog, which currently stands at more than 280 projects.
The administration's policies, according to Mark Compton, executive chairman of the American Exploration and Mining Association, "have truly been antithetical to giving that domestic mineral output." Currently, permitting is still making it difficult to attract mining investment to the United States.
According to environmentalists, federal safeguards against potential air and water pollution should not be reduced because mine permits take so long to approve. According to Aaron Mintzes, senior policy counsel for mining advocacy group Earthworks, several causes, including a staff exodus from the BLM under the Trump administration and efforts to move the bureau's headquarters, could be responsible for permitting delays.
"Permit delays also arise when mining corporations alter their plans, frequently for entirely acceptable explanations. Like shifts in ownership or changes in commodity prices," Mintzes emailed.
Despite numerous demands for comment, the White House remained silent. Although the Biden administration has taken steps of its own to streamline licensing procedures,
it is unclear at this time if mining operations will be covered by those initiatives.
According to Brian Hires, a spokesman for the BLM, the agency performs "careful, methodical, and rigorous evaluations of all projects.
The length of time needed for these assessments "may vary greatly, depending on the size, geography, complexity of the project, and other factors including litigation, economics, and the completeness of the application."
Additionally, Hires cited a GAO report from six years ago that revealed it takes two years on average to approve a mine plan of operations. But the survey also discovered that the time it takes to fully approve a mine plan can vary greatly, from one month to 11 years. The Forest Service, which regulates mine development in federal lands and has defended its lack of approval of mine plans under the Biden administration, concurred.
But as long as capacity permits, Muehlhof added, "the Forest Service takes all reasonable steps to process submittals in a timely manner in conformity with mission requirements." He added there is no precise information on the number of plans that have historically been accepted, rejected, or pending.
According to the numbers, the Biden administration might be the best moment to buy into a U.S. mine, especially if it produces the kinds of minerals needed to create the batteries for electric vehicles.
With his Energy Department, Biden expanded on a Trump administration initiative to use federal loans to jump-start domestic minerals processing and refining. Biden invoked the Defense Production Act to finance mining-related projects. He also assisted in guiding the bipartisan infrastructure law's approval, which included a few potential clauses meant to smooth things up in the federal permitting system.
And when Biden took office, it appeared like investing in minerals was a good idea because organizations like the International Energy Agency anticipated a sharp increase in metal consumption as a result of the move away from fossil fuels. This could get worse in the United States because a crucial tax credit for electric vehicles is tied to utilising domestic minerals under a clause of the climate funding plan that the Senate passed.
But lately, neither in this nation nor elsewhere, mining companies have launched many new projects. Instead, they have been repaying loyal investors and avoiding the risks associated with investing in initiatives that might fail. For the American energy transition, this might have significant ramifications.
As per a recent estimate by analysts at Bank of America Corporation's global research division, the mining industry would need to invest a staggering $81 billion annually in order to meet demand projections for the world in order to avoid "bottlenecks to attaining net zero" by 2050. According to the research, "Mined raw materials are critical to the energy transition, but a shortage of several metals crucial for future technologies is placing Net Zero at danger." "This threat is only beginning to be recognised by the globe."
According to some industry experts, the risk involved with a government approval process during a precarious and unpredictable period in the economic world order is a likely factor keeping mining corporations from investing the money necessary to establish mines in the United States or elsewhere.
Investors demand transparency, according to Gabriela Herculano, CEO of green technology investment company iClima Earth. Do I pay a dividend or invest in [a new project] and say, "Don't you worry investors, you're not going to be getting cash in your pocket now, but with the high returns I'm going to derive out of this [project]," if you're on the board or in the investment community of a listed company?
Mine development has also been cited by Biden's administration as the main obstacle to achieving his climate targets. Simplified
A grinding mill installed at the Arcadia lithium mine in Goromonzi, Zimbabwe. The Chinese firm Zhejiang Huayou Cobalt earlier this year said it would pay over $400 million for the hardrock lithium mine. Tafadzwa Ufumeli/Getty Images
THE LEAD
permitting was the Energy Department's top suggestion in a comprehensive review of supply chain risks published in February to address the shortage of raw materials for the energy transition.
But most of what BLM has authorized since Biden took office has little bearing on the energy transition. The bulk of officially sanctioned mining enterprises on BLM lands was modestly sized gold operations. Plans to mine clay, calcium, and diamonds were also granted. One of the initiatives was a treasure hunting group in Utah called the Septarian Dragon Egg Nest, where hobbyists search for rocks that resemble actual "dragon eggs." This organization wasn't even a mine.
One lithium mining project was permitted to proceed by BLM; it was an exploration project in Nevada run by the Canadian mining business Pure Energy Minerals Ltd. and the world's largest oil services company, Schlumberger Ltd. Their initiative would make use of direct lithium extraction, an experimental variation on filtered lithium extraction that is favored by environmentalists for having a less detrimental effect on the environment than more conventional lithium mining techniques.
The Thacker Pass lithium mine in Nevada obtained its final environmental impact statement and record of decision in the last days of former President Donald Trump's administration, but the BLM data also gave that agency credit for authorizing the project. According to BLM, the project's approval "spanned into President Biden's administration," which made the decision to approve the mine plan.
What's Biden up to?
Republicans have generally backed the notion of overhauling permitting for all sorts of projects, including mines. Still, a number of senators have expressed doubt that Democrats will implement the rough plan outlined by Manchin. However, some analysts claimed that even if the Senate is unable to reach a consensus on legislation, the Biden administration has made moves to expedite infrastructure projects that could help the mining sector.
The FAST-41 permits steering program was extended by Biden's bipartisan infrastructure package, which was then expanded by the Trump administration to cover significant mining projects in an effort to expedite approvals. The infrastructure measure also established a two-year deadline for FAST41-covered project permits.
In May, the administration unveiled a multipronged "action plan" to expedite complex infrastructure projects. This included allocating funding to the White House Interagency Permitting Council, cutting redundancies at federal agencies, updating antiquated permitting regulations, and bringing together experts from various industries to discuss topics like the sourcing of essential minerals and materials.
Uncertainty exists around whether these initiatives will indeed hasten the lengthy and complicated environmental processes that mine developers must undergo.
The Fixing America's Surface Transportation Act's improvements to permitting, which resulted in the formation of the Permitting Council and a dashboard to follow evaluations of essential projects, form the foundation of much of Biden's proposal.
A partner at the law firm Kramer Levin Naftalis & Frankel LLP named Andrew Otis said he's eager to see the solutions developed by the sector-specific team put together as part of Biden's plan.
Otis claimed that even though the Biden administration is preparing to draught new regulations, they aren't intended to hasten mining projects. Instead, they will establish clear and uniform standards regarding climate change, ensure that decisions are supported by science, and prioritise environmental justice. Parts of Biden's approach, such as creating timetables, initial scoping, and public outreach, were praised by Otis for potentially accelerating complicated and time-consuming environmental reviews through early problem detection. According to him, the process of approving a mine can take ten years or even longer if there is litigation.
"This is probably as far as you can go if you're not going to amend any legislation," he added. Biden's proposal, according to Bracewell LLP partner Ann Navarro, sees a more significant role for the permitting council and the sector-specific teams as part of a genuine attempt to better organize the federal government and prioritize complicated projects.
In order to assist the permitting council in tracking and facilitating projects, Navarro said it's unclear whether the administration plans to increase staffing or merely put together more interagency teams. Employees with project management skills should be added to organizations like BLM to speed up and simplify the procedure for mines on public lands.
According to her, the council is most useful for settling conflicts and coordinating across agencies, and it might be able to more effectively calm disputes between agencies when it comes to complicated mining projects.
As staff employees within federal agencies reposition themselves, Navarro warned that the process, should it include the creation of new regulations, might initially drag down already complex and time-consuming evaluations.
"It's feasible to permit a mine in less than a few years, but practically speaking, it tends to take a while if an agency has to carry out complicated environmental studies under numerous legislation," she added.
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