The Wolf River Headwaters Protection Purchase

  
For Immediate Release: September 17, 2002
Contact: Sen. Hansen Ph: 608-266-5670

(Madison)--Despite BHP Billiton's decision to close its Nicolet Minerals office in Crandon, Senator Dave Hansen (D-Green Bay), Vice Chair of the Senate Environmental Resources Committee, announced today that he will continue his efforts to strengthen the state's groundwater standards as they apply to metallic mining.

"While BHP Billiton/Nicolet Minerals has made a corporate decision not to pursue the Crandon Mine project, there is no guarantee that some other party won't come in and pick up where Nicolet Minerals left off. We need to remain vigilant in protecting what is widely regarded as one of the state's greatest natural treasures, the Wolf River," said Hansen who authored legislation last session that would subject metallic mines in Wisconsin to the same groundwater standards as landfills and other Wisconsin businesses.

The history of the Crandon Mine project spans decades and has involved numerous corporations including at one time Exxon Corporation, owner of the Exxon Valdez that went aground in Prince William Sound, Alaska creating one of the nation's biggest environmental disasters ever.

"While some will take comfort in the fact that BHP Billiton has decided not to pursue the Crandon Mine, there remains a concern that our laws are not strict enough to prevent some other corporation from abusing the resource and causing potentially permanent damage to the Wolf River in their attempts to open and operate the mine."

The state had considered purchasing the property that the mine is located on but Governor McCallum cutoff negotiations when he deemed the asking price too high.

"One can argue whether or not purchasing the mine site is a wise use of state resources given our current budget deficit, but the fact is the Governor has taken that issue off the table for now leaving the Wolf River at risk. And doing everything we can to eliminate that risk should be our top priority including strengthening the groundwater standards and passing the ban on the use of cyanide."

[ to Governor McCallum ]  Do you think that the mine is dead in Crandon?

I wouldn't say that because I think they're looking at other mining operations to purchase (the mine).

But do you think that they will ever be able to sell it to a company that can meet the requirements, a company that can go through the hoops?

That's a good way to put it. I expressed to a number of people up there earlier, as much as we have tough laws ... there are so many other obstacles that are put up in Wisconsin. It's very frustrating for many of us.

I saw it (with Ashley Furniture in Arcadia). I wanted Ashley Furniture expanding in this state. ... I understand what they're doing, and I want them to exist, and I want them to keep the jobs they've got there, and to do it they need to expand.

So you don't think the Crandon mine proposal is dead?

I do not. I don't think it's dead. ... They may have some other interested buyers. I'll tell you what I do know is ... I'm not going to have the state get into running a business (by buying the mine).

I was truly amazed that (Doyle) was critical of my not purchasing (the mine) at the price that was being talked about. It was a bad deal for taxpayers, it was a bad deal for jobs, it was a bad deal for the environment, the costs to the Stewardship Fund.

For Jim Doyle to be critical and say the state ought to be making that purchase shows the lengths that he will go to sell out the taxpayers of Wisconsin to get elected to office.

State Won't Pursue Crandon Land Purchase

GOVERNOR'S STATEMENT

(Contact him with your reaction at 608-266-1212 or wisgov@gov.state.wi.us )

I believe this decision reflects the sentiment of many Crandon-area citizens who have serious reservations about the possible loss of jobs if the state were to acquire the Nicolet property. Mining is an important economic driver in the Crandon area and the concerns of citizens definitely played a role in our decision to stop negotiations.

The decision also protects the future of the Stewardship Fund and safeguards our ability during the next several years to finance land purchases that expand recreational opportunities and protect environmentally sensitive areas in Wisconsin.

DEPARTMENT OF ADMINISTRATION STATEMENT

State Will Not Pursue Purchase of Mining Company Land

The state will not acquire land owned by the Nicolet Minerals Co. near Crandon for public recreational and conservation use, state Department of Administration Secretary George Lightbourn announced today. A number of Native American tribes, environmental groups and others had urged state officials to explore potential acquisition of the land by tapping into a special $241.8 million state fund earmarked for recreational and conservation land purchases (the Stewardship Fund).

�I met with representatives of the mining company and found that a transaction on terms acceptable to both parties is not possible. Two appraisals were obtained that estimated the value of the property, including mineral rights. Unfortunately, when mineral rights are factored in, the purchase price would I require an over-commitment of the state's limited Stewardship resources for a single acquisition, Lightbourn said. He stressed that the Stewardship Fund is "intended to finance land purchases that expand recreational opportunities and protect environmentally sensitive areas in Wisconsin over the next seven years. "The use of Stewardship funds to purchase mineral rights would adversely affect our ability to complete high-priority land acquisitions for years to come," Lightbourn concluded.

The company is expected to continue to seek permits from the state Department of Natural Resources to mine the site�s zinc and copper deposits.

State Administration Secretary George Lightbourn just telephoned to say the deal is dead. The mining company will release a statement this afternoon.

We need to get back on MESSAGE. We need candidates for Governor and Legislature to pledge to Ban Cyanide in Metallic Mining and End Special Treatment for Metallic Mining.

The Crandon Mine is a bad idea. The Wolf River and Rice Lake are pristine water resources that are at risk from this unsafe zinc and copper mine.

The mining company asked us to consider a public acquisition. The mining company paid for the appraisals which were just completed last week. Unfortunately the mining company seems unwilling to meet the state halfway on a price.

The need for passage of the Cyanide Ban and No Special Treatment of Metallic Mining bills is even more important than ever. See the Wisconsin Campaign to Ban Cyanide in Mining at http://treaty.indigenousnative.org/cyanide.html

PHONE OTHERS TO COME TO THIS MEETING TOMORROW!

The next meeting of the Wolf Watershed Educational Project (WWEP) will be on SATURDAY, SEPTEMBER 14, in WAUSAU, at 2:45 after the Citizens' Energy Forum planned by our allies in Save Our Unique Lands (SOUL). With all the recent positive developments on the Crandon mine, it is doubly important that we help SOUL prevent new powerlines that would industrialize northern Wisconsin--one way of preventing future mines.

The WWEP meeting will be held from 2:45 to 6:00 pm on Saturday at the Westwood Center, 1800 Bridge Street, in Wausau. The Energy Forum will be from 10 am to 2:30 Saturday, as well as on Friday evening. Please come if you can to both the Citizens' Energy Forum and the WWEP meeting DIRECTIONS FROM HWY. 51: Take the Bridge St. exit (exit 193). Stay straight to go onto ramp; Keep left at the fork in the ramp. Turn left onto West Bridge St.

PLEASE WRITE THESE BHP BILLITON OFFICIALS TO ASK THEM TO DROP THE CRANDON PROJECT IN WISCONSIN:

September 13, 2002

Reacting to the Governor�s statement that ended negotiations for the public acquisition of the Crandon mine site, environmental groups expressed disappointment and determination to work harder and longer to protect Wisconsin from dangerous sulfide mining.

�We are very disappointed in Governor McCallum,� said Claire Schmidt, mining campaign director of Wisconsin�s Environmental Decade. �He had the opportunity to show some leadership and make a landmark conservation purchase for Wisconsin and he dropped the ball.�

�BHP Billiton was unable to get the state to pay for their bad investment. So now we�re going to have to fight longer and harder. Wisconsin citizen opposition has kept that mine from opening for decades, and that same citizen opposition is even stronger today. Wisconsin�s economy depends on tourism, not mining. The people whose jobs depend on our clean environment are not going to go away,� added Schmidt.

Jim Wise, of Northern Thunder and the Wisconsin Stewardship Network and a Tomahawk businessman said, �I�m disappointed but not surprised. We�ve worked with this company for years and they�ve never been totally honest.�

�The governor decided to pull the plug on the negotiations before they even began. The Crandon mine is the major environmental threat to Wisconsin, and it�s clear that the governor is out of touch with the issue,� said Caryl Terrell of the Sierra Club.

�We were waiting for a dollar figure from the appraisals, and we still haven�t seen it. Why didn�t the public have a chance to look at the dollar amount and participate in the purchase process? The public has a right to know the results of the Crandon Mine site appraisal and give feedback to their elected officials,� added Schmidt.

Joanne Sleeter, Town Clerk of the Town of Nashville said, �Now we�re angry. We�re going to get up earlier and work longer to stop this mine.�

�If the Governor thinks opening a mine in the north woods is popular, he will find out he is dead wrong,� added Terrell.

Mining Campaign Director
Local Issues Coordinator
Wisconsin�s Environmental Decade
122 State Street Suite 200
Madison, WI 53703
(608) 251-7020   (608) 251-1655f
www.environmentaldecade.org
schmidtc@environmentaldecade.org

The Forest County Potawatomi Community
P.O. Box 46 Crandon, Wisconsin 54520

For Further Information:
September 13, 2002
Tom Krajewski - 414 405 1047

Statement of Forest County Potawatomi Community Chairman Harold �Gus� Frank on Crandon Land Purchase

We are committed to protecting our environment; I am disappointed the state gave up so easily.

We are saddened to learn that Governor McCallum believes �Mining is an important economic driver in the Crandon area�.�

In reality, the proposed mine is an environmental and economic disaster that threatens Northern Wisconsin.

The state will not buy a proposed zinc and copper mine in northern Wisconsin because the cost of the property would be too expensive, the McCallum administration said Friday.

Gov. Scott McCallum also trumpeted the economic benefits if the controversial mine near Crandon is built and called mining an "important economic driver."

The decision comes after McCallum in June called a possible deal "intriguing," and said he would consider a proposal by environmental groups and Indian tribes to use public land stewardship money to purchase the 5,000 acre parcel.

But after receiving two appraisals that put the value of the property - including mineral rights, at $51.2 million to $94 million - state officials rejected a possible deal.

"I met with representatives of the mining company and found that a transaction on terms acceptable to both parties is not possible," said George Lightbourn, secretary of the state Department of Administration in a statement. "Unfortunately, when mineral rights are factored in, the purchase price would require an overcommitment of the state's limited stewardship resources for a single acquisition."

The Stewardship Fund is used to purchase land for public use. The Crandon mine has been one of Wisconsin's most contentious environmental issues.

Nicolet Minerals Co., the owner of the mine, has said that it could meet any environmental limits imposed on the company. But opponents of the mine say they proposed the buyout because, although they believe the project faces an uphill battle from the Department of Natural Resources, they want to ensure the land would not be purchased by another mining company.

The decision not to buy was criticized by groups that had sought the buyout.

Mining is not a stimulus for the local economy, but "in reality, the proposed mine is an environmental and economic disaster that threatens northern Wisconsin," said Harold "Gus" Frank, chairman of the Forest County Potawatomi.

"Wisconsin's economy depends on tourism, not mining," said Claire Schmidt, mining campaign director of Wisconsin's Environmental Decade, in a statement. "The people whose jobs depend on our clean water are not going to go away.

Attorney General Jim Doyle, the Democratic candidate for governor, said Friday that McCallum's decision was bad news for the environment.

"Governor McCallum announced this proposed purchase with much fanfare," Doyle said in a statement. "This was a leadership test for the governor, and he has failed."

Since 1994, Nicolet Minerals has sought state, local and federal permits necessary to extract 55 million tons of ore from a mine just south of Crandon, near the headwaters of the Wolf River. The DNR said Friday it expects to complete its environmental impact statement on the project by the first quarter of 2003.

The company and its supporters argue the mining can be done safely and will create jobs. Nicolet Minerals President Dale Alberts did not return a phone call asking for comment Friday.

Nicolet Minerals is a subsidiary of BHP Billiton, formed by the merger of mining companies based in the United Kingdom and Australia. Appeared in the Milwaukee Journal Sentinel on Sept. 14, 2002.

Barely three months after the governor raised the idea of the state buying a proposed underground zinc and copper mine in northern Wisconsin to end years of acrimony over the project, the state said Friday it won't buy the property because it is too expensive.

Talks with Nicolet Minerals Co. regarding some 5,000 acres near Crandon started about a week ago, but the price for the land and its mineral rights was too costly, state Department of Administration Secretary George Lightbourn said.

"I met with representatives of the mining company and found that a transaction on terms acceptable to both parties is not possible," he said in a statement.

"Unfortunately, when mineral rights are factored in, the purchase price would require an overcommitment of the state's limited Stewardship resources for a single acquisition."

Gov. Scott McCallum said in June he would consider a proposal from a coalition of conservation groups and tribal governments for the state to in essence buy out the mining project, which critics argue will pollute the environment.

Two appraisals of the land, including the mineral rights, set the value between $51.2 million and $94 million, said Peter Maternowski, section chief in the Administration Department's Division of Facilities Development.

McCallum said Friday the decision not to buy the land safeguards the state's future ability to finance land purchases that expand recreational opportunities and protect the state's environmentally sensitive areas.

In addition, many Crandon-area citizens had "serious reservations" about the state buying the land and ending the possibility of many well-paying jobs, McCallum said.

"Mining is an important economic driver in the Crandon area, and the concerns of citizens definitely played a role in our decision to stop negotiations," McCallum said.

Mining Impact Coalition of Wisconsin
Media Release September 16, 2002
For immediate release
Contact: Dave Blouin, 608-233-8455
Claire Schmidt, 608-251-7020

Employees of BHP Billiton's Nicolet Minerals Company announced today that they received notice Friday, September 13, that their jobs would be terminated. That same day, the State of Wisconsin announced that it would not pursue a purchase of the proposed Crandon mine site.

"This news does not necessarily mean the sudden death of the Crandon mine, or an end to company ownership of the Crandon site's mineral rights," said Dave Blouin, coordinator of the Mining Impact Coalition of Wisconsin. "There is also always a possibility that a new owner could leave open the possibility of a future mine, or in some other way endanger the natural and cultural resources within the mine site. We will accept no less than a permanent end to the mine--not mothballing it to reopen for future generations."

"In light of Nicolet Minerals' decision to fire 8 employees, we want to see Nicolet Minerals withdraw their permit application," said Claire Schmidt, Wisconsin's Environmental Decade Mining Campaign Director. "This is a waste of time for the DNR."

Opponents of the Crandon mine proposal will continue to work to pass mining law reform bills such as the Cyanide Ban and No Special Treatment for Mining in the next legislative session. "The Crandon mine proposal is still a terrible idea and the wrong way to grow the economy of northern Wisconsin," continued Blouin. "We need the governor and our legislators to step up and protect our tourism economy from unsafe metallic mining."

CAUTION:
This news does not necessarily mean the sudden death of the Crandon mine, or an end to company ownership of the Crandon site's mineral rights. There is also always a possibility that a new owner could leave open the possibility of a future mine, or in some other way endanger the natural and cultural resources within the mine site. We will accept no less than a permanent end to the mine--not mothballing it to reopen for future generations !

Newswatch 12 learned that most of the company's employees have been fired. Employees tell Newswatch 12 they were notified Friday their jobs are being terminated.

Company officials have not released any information on this action and we do not know at this time exactly what this means for the future of the Crandon Mine project. jobs are being terminated.

The layoff of most of Nicolet Mineral's employees comes on the heels of an announcement by the State Friday that it will not purchase the mine land from the company.... jobs are being terminated.

Tune to Newswatch 12 as we will continue to follow this story and bring you more information as it becomes available. jobs are being terminated.

The plan to build a mine in Crandon has reached another setback this time Nicolet Minerals is laying off eight employees in Crandon. Nicolet Mineral's parent company based out of Australia made the layoff announcment on Friday. After evaluating their assets Worldwide BHP Billiton is selling Nicolet Minerals. All employees except for the president have until the end of September to find Another job. The president of Nicolet Minerals says he doesn't blame their parent company but the state for dragging it's feet on The project. Mine opponents say the sale should have happened sooner.

((This is one of the best underdeveloped zinc resources in North America. It should be developed and even though it didnt' fit into BHP's portfolio it may fit into someone else's portfolio.))

((As far as another company coming in and buying Nicolet Minerals. I think that's a long shot. If Nicolet Minerals can't mine it Properly, no one else can.)) --Dale Alberts, NMC

Crandon -- The company that wants to build an underground zinc and copper mine near the headwaters of the Wolf River is calling it quits.

BHP Billiton, the Melbourne, Australia-based multinational that operates Nicolet Minerals in Crandon, will close its office and sell the mine project to pursue more profitable ventures.

There are just bigger fish to fry around the world where they don't have to put up with this kind of hassle," said Dale Alberts president of Nicolet Minerals. "That's the bottom line."

The project, which would have employed about 400 people for 30 years, has drawn fierce opposition from environmentalists, who claim that acidic mine runoff and cyanide used in ore extraction project would jeopardize the pristine Wolf River.

BHP Billiton becomes the latest in a string of owners to try and fail to mine an estimated 55 million tons of ore from a mile-long, 100-foot-wide mineral deposit that lies 2,200 feet beneath ground near Crandon.

"This is number six," said Chuck Sleeter, chairman of the nearby town of Nashville and a mine opponent. "It's quite plain that, if you were another mining company, you probably wouldn't want to pay that much for a piece of property that may never get mined."

Sleeter said he remains cautious about the future of the project -- a feeling shared by other mine opponents.

"I'm still very concerned about what the next step is," said Dave Blouin, coordinator of the Mining Impact Coalition of Wisconsin.

Rebecca Katers, who directs the Green Bay-based Clean Water Action Coalition of Northeast Wisconsin, said it makes sense for the state to seize the opportunity to buy the land now. "The project has come and gone for 25 years now," she said. "We would still like to see the final purchase of the site so we don't have to go through this roller-coaster ride."

Gov. Scott McCallum announced on Friday that the state wouldn't buy the 5,000-acre mine property because it's too expensive. Two appraisals put the value of the land and mineral rights between $51.2 million and $94 million.

A scientific poll conducted in June 2001 indicated that 55 percent of residents statewide opposed the mine. Opposition ran even stronger in Green Bay and the Fox River Valley, where 61 percent of those polled said they opposed the mine.

The state Department of Natural Resources has yet to issue Nicolet Minerals the permit it needs to mine the property. Dave Kunelius, the DNR's mining outreach coordinator in Rhinelander, said his agency won't stop work on a draft environmental impact statement now under preparation.

"Not until we receive some word that they're withdrawing their application, and that has not happened," Kunelius said.

Alberts said his company will not withdraw its permit application. "This is a darn good resource," he said. "It's one of North America's best undeveloped zinc resources, and should be developed, and I think it will be developed by someone."

The move results in the lay off of eight employees in Crandon. "We find ourselves in a position where for 10 months now we've had a full staff here that have had very little, if anything, to do because we submitted all our stuff to the DNR last year," Alberts said. "No company can be expected to pay people to sit around and do nothing."

Alberts said he will remain in Crandon to oversee the permit process with the help of consultants. He said sale of the property to a developer is unlikely. "We're looking to sell the mining project," he said, and added that he believes the project is far from dead.

"From a personal point of view I don't think so," Alberts said. "I think there may well be some companies willing to pick up this ball and carry it across the goal line."

Environmentalists said Monday the decision by mining giant BHP Billiton to lay off all but one of its Nicolet Minerals Co. employees in Wisconsin is an obituary for the controversial Crandon mine proposal.

�It�s a dead project,� said longtime mine opponent Al Geddicks, a University of Wisconsin professor who has written extensively on the issue. �It�s been dead for over a year and a half, ever since (former owner) Rio Algom wrote the project off its books and decided not to put in any more investment.�

Eight of Nicolet Minerals� nine full-time employees were notified Friday that their jobs will be terminated by month�s end. The lone remaining mining official in Wisconsin, Nicolet Minerals president Dale Alberts, said Monday the project is not dead, just in need of a new owner.�

The permitting process will continue,� Alberts said. �I will be around to manage that process and the sale process. We�ll see who else is interested in this project. I just hope another mining company picks this up and takes it through to completion. It�s a good asset and should be developed.�

The news is not good for mine supporters, however.

�It�s unfortunate,� said Alberts. �Clearly it�s a disappointment for our team. We�ve had a full staff since last December with nothing to do. The company cannot continue to pay people to sit around doing nothing waiting for the DNR to do its job.�

Alberts was referring to the draft environmental impact statement, which the state Department of Natural Resources has been working on for years, in some cases chasing a moving target as project ownership changed hands and mining companies came up with new plans to answer concerns about water pollution and groundwater depletion.

Fear of water pollution has plagued the project since Exxon first discovered the giant ore body in Forest County 27 years ago and proposed what would be the largest hard rock mine in Wisconsin history. The ore body, located five miles south of Crandon, is almost a mile long and roughly 100 feet wide. It begins 200 feet below the surface and extends downward to depths of 2,200 feet. It contains 55 million tons of ore, primarily zinc and copper with relatively small amounts of lead, silver and gold.

It is located near the source of the upper Wolf River. Mining companies have faced two major hurdles � the incredible difficulties of mining beneath the water table and the problem of isolating massive quantities of highly sulfuric mine wastes.

In August, the DNR wrote the company saying computer groundwater models predicted pollution one-quarter mile from the mine site, beyond its compliance boundary. The DNR predicted pollution would move much faster and reach much higher levels than the company forecast.

It would appear that the company does not intend to invest large amounts of money to counter these latest projections.

�My read on the situation is that the money left town some time ago,� said anti-mine activist George Rock, a retired engineer and a member of the Wolf River Chapter of Trout Unlimited. Alberts said Monday the company does not have any major new studies in the works.

�This DEIS (draft environmental impact statement) is long overdue,� Alberts said. �It�s time they published it.

�Franc Fennessy, deputy DNR secretary, said Monday the permitting process would continue. The DEIS should be out early next year, beginning a series of legally mandated events, including public hearings and a master hearing, that could result in a decision on the permit sometime in 2004.Alberts said the decision by BHP was based on a global review of its assets.

�It (the Crandon mine project) did not stack up financially with the company�s other opportunities around the world,� Alberts said. �It is aggressively pursuing the sale of its assets here. Other mining companies are reviewing the data.�

Mine opponents wonder who would buy it. For several months, environmentalists and tribal leaders have been championing a proposal under which the state would use money from the state�s Stewardship Fund to buy the mine company�s land holdings. But those negotiations were terminated Friday, the state announced.

�I believe the decision reflects the sentiment of many Crandon-area citizens who have serious reservations about the possible loss of jobs if the state were to acquire the Nicolet property,� said Gov. Scott McCallum.

Geddicks said it is unlikely another mine company will invest in the project.�If you are the largest mining company in the world, and you can�t get the project going, how is any other mining company going to do what BHP couldn�t do.�

Ironically, on the front page of the State Journal Sept. 17, the paper ran a story on the issues that may decide who will be governor. They are: CWD, Property Taxes, Budget Deficit, Concealed Handguns, and Crandon Mine.
http://www.madison.com/wisconsinstatejournal/local/32322.html
Here's the snipped portion on the mine:

Scott McCallum (Rep.): The governor stopped the state from negotiating to buy the land around the proposed northern Wisconsin mine last week. He said mining is an important economic driver in the Crandon area.

Jim Doyle (Dem.): He criticized the governor for breaking off negotiations. Doyle also wanted the governor to call a special session of the Legislature to protect the state from mining pollution.

Ed Thompson (Libertarian): He doesn't think the state can afford to buy the land around the mine. But Thompson also is "not very high" on the mining proposal and wants to make sure it's "absolutely safe."

Jim Young (Green): He pledges to negotiate a fair purchase price for the proposed mine property and its mineral rights. Young also wants to ban mining in Wisconsin until better technology makes it safe.

The mine has long been a top and visible issue for environmentalists.

Activists fighting against a proposed mine near Crandon urged the governor Tuesday to reconsider purchasing the property now that its owner has abandoned plans to extract minerals from the site.

Members of several environmental groups said the white flag from BHP Billiton, the parent company of Nicolet Minerals Co., shows the company has realized its proposed copper and zinc mine is not viable. The governor should use that leverage to negotiate again with the company and finally end the uncertainty of mining prospects at the headwaters of the Wolf River, said Rebecca Katers, executive director of the Clean Water Action Council of Northeast Wisconsin.

On Friday, Gov. Scott McCallum announced the state would not buy the 5,000-acre parcel near Crandon with money from its Stewardship Fund because of the cost. Two appraisals put the value of the property, including the mineral rights, at $51.2 million to $94 million.

And on Monday, Nicolet Minerals announced that it was laying off its employees in Crandon and that it planned to sell the property and mining rights. Even if Nicolet obtained the permits to mine the zinc and copper, the financial picture didn't warrant pursuit of the mine operation, said Dale Alberts, company president.

While announcing the plans to sell the property, Alberts said Nicolet would keep its permit application active with the state Department of Natural Resources. The department is seeking additional information from the company before issuing its preliminary environmental impact statement.

Alberts predicted the mine property would be sold within a few months to one of the companies that had shown interest in the mineral deposits.

Albert Gedicks and other mine opponents doubt that's true, saying BHP Billiton discovered what Exxon and Rio Algom had learned earlier in the 25-year history of the mine controversy: The site is too environmentally fragile to sustain a mining operation. In addition, the low prices now for copper and zinc make it unprofitable to pursue in the current market, said Gedicks, of the Wisconsin Resources Protection Council.

Laura Skaer, executive director of the Northwest Mining Association in Spokane, Wash., agreed it would be difficult to sell the mining interests to another company.

"Why would you come to Wisconsin and fight all those opposition groups and deal with a regulatory agency that is afraid to make a decision?" Skaer asked.

Katers said McCallum and the state should not be fooled by BHP Billiton's talk about selling the mining interests to another company, and that the price for the property should not include the value of the mineral rights because the mine is not viable.

In an interview Tuesday, McCallum blamed the potential lawsuits, and "the politics of delay, and added cost, of having to constantly not only go through the hoops, but go back over them again" for the company's decision to kill the mine.

McCallum said state officials ended negotiations that would have ensured the site would never be developed because the company wanted so much money that it would have "wiped out" the Stewardship Fund used to buy pristine properties to make sure they will never be developed.

Steven Walters of the Journal Sentinel staff and The Associated Press contributed to this report.

By Julie Deardorff
Chicago Tribune staff reporter
September 18, 2002

Crandon, Wis. -- In a sign that a decades-long battle with environmentalists is taking its toll, the world's largest mining company shut the Wisconsin subsidiary it hoped would pull 55 million tons of zinc and copper ore from the ground, officials said Tuesday.

BHP Billiton officials said they are considering selling the 5,000 acres in northern Wisconsin that are not only rich in minerals but also hold the pristine headwaters of the Wolf River. A band of Chippewa Indians consider sacred a rice lake downstream from the proposed Crandon Mine site.

The company said it will continue to pursue the elusive state permits for the mine, despite closing the local office of Nicolet Minerals and laying off eight employees. Environmentalists and anti-mining groups, while heartened by the company's shift, say the fight is not over.

"The fact that the permit application has not been withdrawn leaves the future of the mine site in limbo," said Dave Blouin, coordinator of the Mining Impact Coalition of Wisconsin.

For years battle lines have been drawn between locals who want the mine and the jobs it would bring, and newcomers who want to preserve the environmental character of the region, which includes more than 800 lakes, 82 trout streams and acres of wilderness.

Native Americans who live near the site believe the mine threatens their water supply, air quality and cultural traditions, including burial sites and wild rice resources.

Though the ore deposit was discovered by Exxon nearly three decades ago, the mining project has recently seen a flurry of activity. Last week Wisconsin rejected the idea of purchasing the land for conservation, a move environmentalists championed as a way to kill the mine proposal. State officials deemed the cost, estimated between $51 million and $94 million including mineral rights, too high.

Last month a delegation of local tribal members met with executives from BHP Billiton in Johannesburg, South Africa, at the World Summit on Sustainable Development, the first time the two groups have faced each other. In recent years the campaign against the mine has brought together Native Americans with sport fishing groups, environmentalists with union members and rural residents with urban students, said Zoltan Grossman, a professor of geography at the University of Wisconsin-Eau Claire and a board member for the Midwest Treaty Network.

"It has been one of the most powerful grass-roots movements Wisconsin has ever seen," Grossman said.

Opponents of the Crandon Mine argue that if the ore is mined, it could create a boom-bust economy, irreparably damage the Wolf River and hurt tourism, which is supported by the north region's fragile wetlands, streams, wildlife and other natural resources.

Mine supporters tout its practical and economic advantages. Not only does modern society require minerals and metals for everything from batteries and sport-utility vehicles to nutritional supplements, but the Crandon Mine promises valuable jobs to one of the poorest counties in the state. Since 1996 more than 1,200 people have applied for 400 jobs at the mine, should it be built.

"The community needs good-paying jobs," said mine supporter Ron Eveland, 70, a member of the Forest County Board and the Crandon City Council. "I don't know what's going to happen with this. It's a mess."

Long-running dispute

The Crandon Mine saga spans a generation. In Nashville, a town of 1,157 where some of the ore is located, the dispute has so severely strained relationships that that the township is threatening to break in two. Generally, the south part of Nashville--where many former city dwellers have built homes around lakes--opposes the mine. The north end of the township--which has deep roots and is largely rural and working-class--supports the mine.

The Mole Lake band of the Sokaogon Chippewa, meanwhile, who live on an 1,800-acre reservation just a mile downstream from the proposed mine, is worried about the mine's impact on groundwater, as well as on nearby Swamp Creek, a tributary of the Wolf River, and Rice Lake, where they annually harvest wild rice for cultural and spiritual ceremonies. A major hurdle for the mining company is a U.S. Supreme Court ruling allowing the Sokaogon Chippewa to set their own standard for groundwater used in the mining process. Leaders have promised it will be tougher than the state's.

"People could live with the mine if it definitely wouldn't pollute, but there is so much uncertainty," said Tina Van Zile, tribal vice chairwoman for the Mole Lake Sokaogon Chippewa, one of the poorest and smallest tribes in the nation. "The uncertainty of the science could destroy who we are. We'd rather live with the creators' plan than the mining company's. It seems they don't worry about the future."

The proposed Crandon Mine--on one of the 10 largest ore deposits of its kind in the world--also has become a contentious issue in the state legislature. Although recent legislative attempts to doom the project have failed--including a proposal to ban the use of cyanide, essential to the mining process--several gubernatorial candidates are publicly opposed to it.

At stake, some say, are other mining project proposals across the mineral-rich state. If the Crandon Mine is successful, it "would show that you actually can permit a mine in Wisconsin," said Laura Skaer, executive director of the Northwest Mining Association. "If they could get it permitted, other companies would be interested in exploring."

"All those people who have homes on the lake, computers, cell phones, SUV's, they all have stuff that came out of holes in the ground," Skaer said. "Unfortunately the minerals are where God put them. It's not like building a Ford plant."

Mine formed, found

Created 1.8 billion years ago when mineral-rich water, volcanic material and gases bubbled up through cracks in the sea floor, the zinc-copper sulfide deposit was discovered by Exxon in 1975 in Forest County, a rural timber region dotted with small towns.

The ore deposit, which also contains small amounts of lead, gold and silver, primarily runs east and west through Nashville and Lincoln, extending to a depth of 2,200 feet. According to the project plan, ore would be mined for 28 years at a rate of 5,500 tons per day by underground methods. The ore would be crushed underground and hoisted to the surface for milling.

The waste rock at Crandon contains pyrite, a sulfide-bearing mineral that can generate acid if exposed to air and water over a long period of time. The pyrite removed from the ore will be mixed with cement and used as backfill in the mine, according to Nicolet Minerals officials.

Nicolet Minerals, run by Dale Alberts, a former public affairs director, has spent more than $150 million making Crandon the "most environmentally friendly mine in the world," according to Alberts, who has conducted more than 300 public meetings and made presentations on the project to more than 13,000 people to improve mining's historically dreadful reputation.

"A major problem in the beginning was the company did a poor job communicating to the local people," said Alberts, who will stay on with the company at least until the land is sold. "Environmental groups got out ahead and frightened people." Alberts argues that the legitimate environmental concerns have been addressed and the rural population is being ignored.

"Urban centers are setting policy that is stifling, killing the rural way of life and the way we use natural resources," he said. "I've never seen the industry as diminished and hamstrung as it is today."

It will be difficult to sell a proposed underground zinc and copper mine in northern Wisconsin now that one of the world's largest natural resources companies is pulling out of the project, an industry spokeswoman said Tuesday.

BHP Billiton, parent company of Nicolet Minerals Co., said it wants to sell some 5,000 acres of its mining property near Crandon, but the effort to obtain state permits for the mine - described as the largest undeveloped zinc deposit in North America - will continue. "From a pure ore body standpoint, it is quite attractive," said Laura Skaer, executive director of the Northwest Mining Association in Spokane, Wash.

"Whether someone wants to bang their head against the Wisconsin brick wall is another story," she added. "It is pretty clear to me that there is a strong segment of the Wisconsin population that doesn't want this mine built."

A number of companies have indicated an interest in buying Nicolet Minerals, company president Dale Alberts said Tuesday. "I would expect it to be sold within the next few months."

"The asset is still here. The permitting process will continue and we will see what happens," Alberts said. BHP Billiton decided that even if Nicolet Minerals received the necessary state and federal permits to begin mining, the Crandon mine and its prospects for big profits don't stack up well enough against other BHP Billiton projects around the world, Alberts said.

Eight workers at Nicolet Minerals' Crandon office were notified their jobs would end Sept. 30, which will leave Alberts as the lone employee, he said.

Since 1994, Nicolet Minerals has sought state, local and federal permits necessary to mine 55 million tons of ore from a mine just south of Crandon, near the Mole Lake Chippewa Reservation and the headwaters of the Wolf River.

Environmentalists and area Indian tribes have fought the project, contending it poses too great a pollution threat. Supporters say the mining can be done safely and will create badly needed jobs.

BHP Billiton's announcement came just days after talks with the state to buy the company's land - in essence buying out the mining project - ended with no deal. State officials said the price would be too high.

Appraisals done for the state and paid for by Nicolet Minerals set the value of the land, with mineral rights, between $51.2 million and $94 million.

Paul Benson, BHP Billiton's vice president of business development for base metals in Houston, said Tuesday the company decided to cut costs at the Crandon site to save money. Efforts to seek the needed permits will be done by consultants under contract, he said.

There might be only six mining companies capable of investing the $350 million needed to build the Crandon mine, Skaer said. The Northwest Mining Association is a 106-year-old group that represents the hard-rock mining industry, primarily in western states.

The state Department of Natural Resources has said it could be early next year before it recommends whether the mine can be operated safely without polluting the environment. But such deadlines have come and gone for years.

"Why would you come to Wisconsin and fight all those opposition groups and deal with a regulatory agency that is afraid to make a decision?" Skaer asked.

Also working against the mine are today's depressed zinc and copper prices, Skaer said. "Someday in the future, the mine will be developed. Whether or not it is in our lifetime, I can't predict that," she said.

Crandon Mayor Pat DeWitt was discouraged about the mine's future. "I don't have much hope for it any more. I certainly don't," he said. The eight jobs eliminated were probably some of the best- paying jobs in Forest County, DeWitt said.

"It is a shame. It was a good chance for Forest County and northern Wisconsin to get a shot in the arm," he said.

Rusty Price, a mining analyst for Nelson Securities in Spokane, said the Crandon project might get some interest from smaller companies that can take a little more risk.

But the trend in the mining industry has been to move overseas given the difficult process of getting permits to open new U.S. mines, he said.

BHP Billiton has headquarters in London and Melbourne, Australia. Most of the company's metallic mines similar to the Crandon proposal are in Canada or Latin America.

BHP Billiton is not the first mining company to pull out of the project. Exxon Coal and Minerals Co., which discovered the deposit in 1976, applied in 1982 for permits to run the mine and then suspended those plans in 1986 when metal prices were low.

Exxon and a partner, Rio Algom Ltd. of Canada, revived the project in 1994, but Exxon sold its interests to Rio Algom. Rio Algom was later acquired by London-based Billiton, which then merged with BHP.