BLM, state regulators approve major Nev. molybdenum project

Posted: Nov 29, 2012

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Climax mine

The Bureau of Land Management and state regulators have issued all the permits needed for construction of a large molybdenum mining project in central Nevada.

Colorado-based General Moly Inc.'s Mount Hope site is said to contain more than 1 billion pounds of proved and probable reserves of molybdenum, a chemical element used in alloys. Permits from BLM and the Nevada Division of Environmental Protection allow about 40 years of open-pit mining and 30 years of reclamation on more than 8,000 acres.

"We will now pivot aggressively to finalizing our project financing and initiating the construction and development of the world-class Mt. Hope Project," General Moly CEO Bruce Hansen said in a statement. "We are moving forward toward our goal of becoming the largest pure play primary molybdenum producer in the world."

Company executives and regulators have said the project is expected to generate about 400 long-term jobs.

Christopher Cook, manager of BLM's Mount Lewis field office, touted the interagency permitting collaboration. "We greatly appreciate all the effort that has been put forth throughout the process to make this project both an economic and environmental success through numerous design features and continued monitoring and mitigation to address emergent issues in the future," he said.

Not everyone is cheering. While the Board of Eureka County Commissioners hailed the mine's economic development, it released a statement expressing lingering concerns about the project's impacts on natural resources and private property.

"As water levels and stream and spring flows decline, [BLM's record of decision] relies on the promise of still-contingent measures that BLM and [the company] may internally develop, depending on the circumstances, without public participation, far into the future," the board said. "Provisions spelled out in the ROD do not adequately protect natural resources and private property rights in the area."

Other than water issues, critics expressed concerns about environmental monitoring, housing, public safety, traffic and the mine's compatibility with land-use plans. The group Great Basin Resource Watch expressed similar concerns in comments to regulators.

"Ultimately, these issues must be addressed," the commissioners said. "We are disheartened with the choice by BLM and [the company] to delay addressing these issues by saddling future decisionmakers and Eureka County citizens with this responsibility."

Domestic molybdenum production has been on the increase. China is the world's top producer, with the United States in second place, according to the U.S. Geological Survey. Ten U.S. mines produced molybdenum in 2011, whether directly or as a byproduct.

Projects other than Mount Hope are also advancing. Vancouver, British Columbia-based Mosquito Consolidated Gold Mines Ltd.'s CuMo project, for example, is in the exploration phase of a major molybdenum project in the Boise National Forest in Idaho. Lawsuits by environmentalists are forcing the company and regulators to conduct further reviews.

Earlier this year, Freeport McMoRan Corp. announced it had restarted operations at its Climax mine near Leadville, Colo., a site first mined in the early 1900s.

"Molybdenum production is expected to ramp up to a rate of 20 million pounds per year during 2013 and, depending on market conditions, may be increased to 30 million pounds per year," the company said.

Even with production successes, the Obama administration's World Trade Organization dispute over Chinese controls of rare earth elements also includes tungsten and molybdenum. The Department of Energy's latest strategy report on critical materials accuses the country of imposing export quotas.

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