THE MINING TRACK RECORD OF RIO ALGOM, LTD.
CRANDON MINE PROPOSAL, WISCONSIN
In January 1998, Exxon sold its 50% share of the Crandon
mine project to its partner, Rio Algom Ltd., which formed a
new subsidiary called the Nicolet Minerals Company.
Exxon, however, still retains an interest in the zinc-copper
project. If the state of Wisconsin ever permits the project,
Exxon would receive a net profits royalty of between 2.25%
and 3.75% (indexed to the price of zinc), plus a $5 million
bonus should production begin.
The new sole owner of the Crandon project is a giant in the
industry, and has a far more controversial mining record
around North America than Exxon has ever had. Rio
Algom is a Toronto-based mining company with interests in
copper, molybdenum, coal, tin, zinc, silver, uranium, as well
as an international metals distribution business. Many of
Rio Algom's projects have been found to have caused
environmental and economic damage. In each case where
mine reclamation (cleanup) has begun, significant time
passed between site closure and cleanup work, adding extra
costs for the company and causing needless damage to the
environment. Nearly all of Rio Algom's mines have suffered
early or unexpected closures--resulting in massive layoffs
and economic upheavals.
ELLIOT LAKE URANIUM MINES, ONTARIO
Rio Algom was originally the Canadian arm of the world's
largest mining firm, London-based Rio Tinto Zinc (RTZ). In
1955, RTZ acquired a substantial interest in several Ontario
uranium mines near the northern shore of Lake Huron,
collectively known as the Elliot Lake complex. During the
U.S. nuclear weapons buildup of the 1950s- 60s, there
were 12 mines in the area, employing over 10,000 workers.
These mines were combined under Rio Algom in 1960, and
over the next 30 years were identified with one of the
world's most notorious examples of radioactive
contamination of the environment.
By 1976, Ontario officials documented that all 55 miles of
the Serpent River system, including more than a dozen
lakes, were badly contaminated. The wastes from the
Elliot Lake mines are acid-generating due to sulfides, and
highly-radioactive due to the inefficiency of uranium
milling. Typically, more than 85% of the radioactive
byproducts, (radium and radon) end up in the waste tailings.
The report also pointed out that there were no fish living in
the entire river downstream from the mining wastes (another
company there, Denison, also contributed to the problems)
Through 1978, more than 30 tailings dam failures (this
number is the total from both companies) were reported.
And as recently as August 1993, Canada's Atomic Energy
Control Board (AECB) charged Rio Algom with one count
of failure to prevent a "reasonably foreseeable" waste
spill. A power failure at Stanleigh caused a 2 million liter
(500,000 gallons) spill of radioactive and chemically
contaminated water in McCabe Lake. All but one of the
mines were closed by 1990, and the last, Stanleigh, closed in
In 1992, RTZ sold its 51.4% stake in Rio Algom, explaining
that it was to avoid competition with other North American
interests such as its Kennecott Copper affiliate (operator of
the Ladysmith mine in Wisconsin). However, industry
experts interviewed by the Canadian mining industry news-
paper The Northern Miner said that more important were
"the potential liabilities related to the decommissioning of
Rio's Elliot Lake, Ontario uranium mine."
Reports from the Ontario Workman's Compensation Board
(1969) and the Royal Commission on the Health and Safety
of Workers in Mines (1976), showed abnormally high levels
of lung cancers among Elliot Lake miners. Homer Seguin,
former United Steelworkers of America (USWA) Area
Coordinator for Northeast Ontario, says "Rio Algom has a
terrible track record in terms of protection of the environ-
ment and protection of workers in the workplace." Former
USWA National Director for Health and Safety Kenneth
Valentine wrote in 1980 that the companies at Elliot Lake
"should have their license revoked" since "untold numbers
of people have died" from miners' dust exposure (silicosis)
and radiation-linked lung cancer. The provincial health
ministry estimated miners' lung cancer cases to exceed
average rates by 300-500 percent.
Since they have closed, Rio Algom's Stanleigh, Quirke, and
Panel mines have received decommissioning licenses from
the Atomic Energy Control Board. This was the stamp of
approval needed to proceed with reclamation plans that
involve flooding the highly radioactive and acid-producing
sulfide wastes behind dams. This reclamation concept was
the cheapest alternative available to Rio Algom, in that no
further relocation or engineered covers over the tailings was
required. The approved plans were dubbed by critics as
"Flood and Flee," due to Rio Algom's ultimate goal of
handing its Elliot Lake properties back to Canada. (Quirke
operated from 1956-61 and 1970-90 and produce 46 million
tons of tailings and waste rock. Panel operated from 1958-
61 and 1979-90, and produced 16 million tons of wastes.
Stanleigh operated from 1957-68 and 1983-96, with 20
million tons of wastes produced.)
In 1996, Rio Algom set an additional Can.$60 million aside
for future reclamation costs at its remaining Elliot Lake
mines. In the next few years, four other closed mines will
have closure and reclamation plans licensed and regulated
by the AECB. (They are: Pronto, 1955-60 and produced 4
million tons of waste [2 million of which came from the
Pater copper mine]; Lacnor, 1957-60, 3 million tons of
waste; Nordic, 1957-68, 12 million tons; and Spanish
American, 1958-59, where 400,000 tons of wastes were
dumped into Olive Lake. In 1994, 35 years after the mine
closed, tailings in Olive Lake were moved to deeper water
and the lake level raised to cover the wastes. Three more
Rio Algom mines, Milliken, Buckles, and Pater are
considered reclaimed.) In all, more than 100 million tons of
wastes considered by Canada's regulators as "perpetually
hazardous" were deposited at Elliot Lake by Rio Algom.
POIRIER COPPER-ZINC MINE, QUEBEC
The Poirier mine produced copper and zinc from 1966 to
1975, and closed due to low copper prices, putting 200
miners of work. The 123-acre site, located about 200
kilometers north of Rouyn-Noranda, Quebec, is classified by
Canadian regulators as one of the province's worst toxic
waste dump,s due to acid mine drainage. When Rio Algom
sold the mine in 1985 for one Canadian dollar, it insisted the
buyers take out a Can.$1.5 million mortgage to cover future
cleanup costs. The threat of cleanup costs scared away
investors, and generated a scandal when a Quebec
Environment Department official (who was also an investor
in the mine) pressed a colleague to go easy on Rio Algom
and avoid the cleanup. The reclamation plan has as yet not
been approved, but its estimated costs will be Can.$10-20
million. A new Quebec law has made the former operator,
Rio Algom, responsible for site cleanup.
EAST KEMPTVILLE TIN MINE, NOVA SCOTIA
The East Kemptville tin mine in Nova Scotia operated from
1984 to 1992, when it shut down prematurely due to poor
tin prices and high production costs. The mine had been
projected to operate for 17 years. Almost immediately after
the mine opened, local residents found that Big Meadow
Brook and the Tusket River were a muddy brown color from
runoff at the mine site. In 1986, the Department of Fisheries
and Oceans charged Rio Algom under Section 33 of the
Fisheries Act. As a result, Rio Algom was forced to
subdivide the tailings area (to settle out solids) and to treat
effluents prior to discharge. A reclamation plan was
conditionally approved in 1994, but incidents of
uncontrolled discharges of wastewater and windblown
tailings were reported through that year. In 1996, Rio
Algom reported that acidity levels and costs at the mine
were higher than expected and could result in a longer
decommissioning period. In 1997, Rio Algom reported that
it expects to treat the water "for a number of decades before
the generation of acid ceases naturally."
LISBON URANIUM MINE AND MILL, UTAH
The Lisbon uranium operation, located near Moab, Utah
began operations in 1972 but closed in 1988, putting 150
miners out of work. Rio Algom is currently decommission-
ing the site, which contains 4 million tons of uranium mill
tailings. Groundwater contaminated by seepage from the
tailings dump is being pumped to evaporation ponds. At the
former mill site, soil contaminated due to processing and ore
storage is being collected and put into the tailings dump.
Rio Algom reported in 1997 that the tailings are now
covered with a soil and clay liner.
Mill tailings at Rio Algom's U.S. uranium mines (run by its
wholly-owned subsidiary Rio Algom Mining Corporation or
RAMC) are regulated under Title II of the Uranium Mill
Tailings Radiation Control Act of 1978. The U.S. Depart-
ment of Energy (DOE) describes Type II tailings as "...a
long-term hazard to public health and safety. The most
hazardous radioactive constituent in uranium mill tailings is
radium which has a very long half-life. Radium, besides
being hazardous itself, produces radon, a radioactive gas
whose decay products can cause lung cancer. This makes
mill tailings hazardous for thousands of years."
QUIVIRA URANIUM MINE AND MILL,
In 1989, Rio Algom acquired Kerr-McGee's Quivira
Mining Company at Ambrosia Lake, New Mexico. The
properties consist of a mill and nine "closed" underground
mines. Although surface facilities are now gone from each
mine, Rio Algom is recovering uranium via solution mining
in some of the mines. Mine water is circulated through the
mines and treated to recover the uranium. Contaminated
groundwater at the site is also pumped and treated for
Ambrosia Lake is also the home of America's largest
uranium tailings dump, consisting of 30 million tons of
waste. Although the company reports progress on
decommissioning the site, Rio Algom also reported that it
suffered a dam failure in September 1997 when heavy
rains knocked out the wastewater discharge outfall and
weir. In 1997, the company guaranteed $24 million to the
U.S. Nuclear Regulatory Commission for Quivira's
HIGHLAND VALLEY MINE, BRITISH COLUMBIA
Rio Algom owns a 33.6% interest in the Highland Valley
open-pit mine (copper, silver, molybdenum) in Logan
Lake, British Columbia, which opened in 1972 and became
Canada's largest base metal mine. In January 1999, it was
announced that the mine would go on indefinite shutdown,
affecting the 1,046 employees--represented by the United
Steelworkers. The company lost $8 million in the 4th
quarter of 1998. The company had been looking for a
rebound in copper prices or government and/or labor
concessions to help keep the mine open, but the mine
was shot down in May 1999. Because the mine is not completely
closing, the staff will not receive severance or
SMITH RANCH URANIUM, WYOMING
Rio Algom is extracting uranium in Wyoming via "in situ
leaching." This method of mining involves injecting water
with added oxygen and sodium bicarbonate into rock
formations to dissolve the uranium. The mixture is then
pumped to a surface processing plant for separation.
General issues and concerns with this type of mining
include: groundwater contamination in aquifers outside of
the target zone, difficulties with restoring groundwater
quality post-mining, and surface spills.
In addition, Rio Algom has recently opened major base
metal mines in Chile (Alumbrera-gold, copper), and
Colombia (Cerro Colorado-copper, zinc) To date, minor
environmental problems, such as locally contained spills,
have been reported. Rio Algom has financial interests in:
the Highland Valley mine in British Columbia (copper,
silver, molybdenum); the Polaris mine in the Canadian
Arctic (zinc and lead); the Bullmoose coal mine in British
Clearly, the track record of Rio Algom, Ltd. must be further
examined by Wisconsin citizens, and local, state, and
federal agencies, in assessing its Crandon mine permit
application. No matter what stance one may have on the
safety of metallic sulfide mining, the question of whether
this specific company would be a good Wisconsin corporate
citizen is open to some question. Notably, in its 1997
annual report, Rio Algom comments on risks associated with
its various projects that must be "carefully managed."
Among these risks is, "...the potential for permitting delays
to affect the feasibility of the Crandon project in
RESEARCHED AND WRITTEN BY:
Mining Impact Coalition of Wisconsin Inc.
PO Box 55372, Madison WI 55372
phone: (888) 211-7271
Wolf Watershed Education Project.
P.O. Box 14382, Madison WI 53714-4382
Toll-free Hotline: (800) 445-8615
- Canadian Environmental Assessment Agency, "Elliot Lake
Uranium Mine Tailings Areas Environmental Assessment Panel-
- Gordon Edwards, Ph.D., "Uranium: The Deadliest Metal",
Perception magazine, v.10 n.12, 1992.
- Gordon Edwards, Ph.D., "Nuclear Wastes: What, Me Worry?,"
comment paper to House of Commons Standing Committee on
National Resources and Public Works, Canadian Coalition for
Nuclear Responsibility, 1978.
- Gordon Edwards, Ph.D., "Nuclear Wastes: What, Me Worry?,"
Canadian Coalition for Nuclear Responsibility, 1987 addendum.
- Gordon Edwards, Ph.D. et al, "URANIUM-A Discussion Guide",
The National Film Board of Canada, 1990.
- "Elliot Lake Mine Decommissioning Field Tour", Field
Guide, Summer 1995.
- Graeme Hamilton, "Ex-bureaucrat convicted of corruption," The
Gazette, Montreal, 10/29/94.
- Robert Imrie, "Mining Firm has stain on record", Wisconsin State
- Robert Imrie, "Regulator unaware of polluted mine", Wisconsin
State Journal, 8/17/98.
- Roger Moody, "The Gulliver File", London: Minewatch, 1992.
- Roger Moody, "Plunder!", PARTiZANS/CAFCA, 1991.
- Roger Payne, "Decommissioning of Elliot Lake Mining Properties",
In: Proceedings of Sudbury `95-Mining and the Environment,
- Natural Resources Canada, "Licencing For Decommissioning of
Uranium Mine Tailings Management Areas Can Proceed", Release,
- New Mexico Energy, Minerals, and Natural Resources
Dept.-Mining and Minerals Division, various Mine and Mill site
- Northwatch, personal communications.
- Nova Scotians for a Clean Environment, personal communication.
- Nova Scotians for a Clean Environment, correspondence with Nova
Scotia Dept. of the Environment, 2/94.
- Nuclear Awareness Project, "Uranium Tailings in Elliot Lake",
Nuclear Awareness News, Winter 1993-94.
- Rio Algom, Ltd., Annual Reports, 1994, 1996, 1997.
- Rio Algom, Ltd., "Environmental Report", 1997.
- Rio Algom, Ltd., "Responsible Mining for the 21st Century", 1997.
- Rio Algom Ltd., "Annual Information Form", 1997.
- U.S. Dept. of Energy, "Integrated Data Base Report-1996: -U.S.
Spent Nuclear Fuel and Radioactive Waste.
Inventories, Projections, and Characteristics", Revision 13, 12/97.
- U.S. Nuclear Regulatory Commission, "Technical Information
- Tusket River Environmental Protection Alliance, Background
Tom Wharton, "Will Canyonlands survive the latest boom?", Salt
Lake Tribune, 3/24/91.
- Wisconsin Review Commission, "Report on the Track Records of
Exxon and Rio Algom", Wisconsin Review Commission, March
- World Information Service on Energy, Uranium Project, "Impacts of
Uranium In-Situ Leaching", 7/98.
Note: for background see the Wisconsin Review Commission at
and the Committee of Labor Against Sulfide Pollution (CLASP)