During two days of testimony in Pierre, the South Dakota Board of Minerals and Environment heard all the information needed to make a decision on the future of the Coeur Wharf Mine’s potential expansion in Lead.
That decision is expected at the July 20 meeting, after the State and Wharf submit their findings to Chairman Rex Hagg to make his official recommendation to the Board.
Before closing the second day of hearings on Friday, Hagg said he “is inclined” to approve the permit.
Wharf applied for a large-scale mining permit to expand its operations by 48.2 acres. It’s an open pit, heap-leach gold operation that's the last of its kind in South Dakota. The so-called “Boston Expansion” would extend the life of the mine by around three years.
Present at the hearing were representatives from Coeur Wharf, including Matt Zietlow, the environmental manager, and Ken Nelson, the general manager. Wharf’s attorney, Dwight Gubbrud, represented them during the proceedings. The State of South Dakota was represented by Steve Blair, the assistant Attorney General.
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Carla Marshall, a member of the Cheyenne River Sioux Tribe and resident of Rapid City, appeared without legal representation as an intervenor on the permit. Marshall is trying to prevent the expansion.
Both Wharf and the State asked for approval of the permit with the conditions stipulated by the Department of Agriculture and Natural Resources.
Lawrence County Commissioners approved a conditional use permit for the Boston Expansion in January 2022. The expansion would render 6.7 million tons of ore, according to Wharf's large-scale permit application from June 2022, to be processed in Wharf's existing heap-leaching facility. Lawrence County Commission Chairman Bob Ewing was present on day one of the contested hearings and spoke during public comment regarding the local government support for the expansion.
Ewing expressed shock at the need for a contested hearing, and said when the matter came before Lawrence County last January, no one was present to contest it.
”They employ around 250 full-time people from the immediate payroll, which results in $30 million in annual payroll, which is huge in our community,” he began. “The mining and the timber industry made the community that we live in, in Lawrence County, and we’re proud of it.”
Also speaking during public comment were representatives of local businesses. Bill London, the general manager at Terry Peak, which sits directly next to the Wharf operation, gave his support for the expansion, calling it a great partnership and resource for the resort. Dan Werdel of Butler Machinery said 10 of their 80 local employees work directly with Wharf on a daily basis and have been doing so for more than two decades.
No one spoke during public comment in opposition to the mining permit, however, five opposition letters were sent to the Department of Agriculture and Natural Resources during the public comment period.
During her opening statement, Carla Marshall referred to the 1868 Fort Laramie Treaty, calling all mining that has taken place illegal. Marshall also lamented the State’s spills database as being incomplete.
“I’m representing Unci Maka,” Marshall said. ”She is Mother Earth. She is sick. Our waters in the Black Hills are going to become sick…we have to start standing up for the future generations.”
Gubbrud highlighted Wharf’s commitment to the community during testimony from Zietlow, who also spoke on the socio-economic impact of the mine. Zietlow explained that there‘s an equivalent of roughly one offsite job for every employee at Coeur Wharf, and gold severance taxes alone bring in $6 million a year to the state on average.
A total of 28 letters of support from various community and charitable organizations were submitted, all expressing support for the Boston Expansion.
Zietlow answered questions from the board and present parties on the reclamation operations at Wharf, flood and stormwater control measures, and how they address potential nuisances like blast vibrations or sound disturbance. An area already reclaimed by Wharf is leased to a local horseback tour operator, something Zietlow said is indicative of the thorough job done.
”We can say, ‘Look at what we’ve done,’” Zietlow said of the project’s 40 years in operation. “Mining is a short-term disturbance.”
General Manager Ken Nelson testified that the expansion is simply a pushback of their current operation, with no new facilities planned, all the same equipment and using the same methods. Gubbrud also called Crystal Hocking, an engineer and geologist with RESPEC, to the stand. Hocking testified that there is no ground or surface water present in the Boston Expansion area, and that the water table is below the proposed mine pit bottom.
Hocking also echoed the permit application, which said no bats or raptor nests were present in the potential expansion area. When Marshall asked if any surveys were done on the property involving tribal historic preservation officers, Hocking said not to her knowledge.
Blair entered testimony from Roberta Hudson, engineering manager for the Minerals, Mining and Superfund program at DANR and the lead reviewer on the Boston Expansion permit. Hudson testified that the database Marshall referred to as incomplete is simply used for incident tracking, and that figures are left blank initially because totals might not be known until the reclamation process begins. The spills and related information is all available on that site, according to Hudson.
Marshall was not present for the second day of hearings in Pierre, which ran less than four hours. Most of Friday morning was spent discussing in detail the unrelated selenium issue in False Bottom Springs, something Wharf is working to fix since levels went above state standards in 2021. The State called Kelli Buscher with the Water Quality Program to testify on the selenium issue and related permitting for the Wharf Mine.
Although the selenium in False Bottom Springs isn‘t related to the permitting for the Boston Expansion, it does involve the surface water discharge permit for the existing operation. False Bottom Springs sits downstream of historic mine tailings from the Bald Mountain Mine, which operated primarily as a gold mine from 1905 to 1959.
Selenium was at an undetectable level for around 20 years until 2014, when they began climbing. Hudson testified that she notified Wharf that the increasing levels at False Bottom Springs could potentially reach above the state’s effluent maximum of five micrograms per liter. In 2021, the levels climbed above the allowable amount, putting Wharf in violation of the state standards.
Instead of issuing a Notice of Violation, DANR decided to make mitigation of the selenite issue at False Bottom Springs a condition of Wharf’s new surface water discharge permit, which is currently in draft stage. Hudson said Wharf has been ”working diligently” with the department to make progress. Zietlow explained they’ve done sonic drilling since 2017 to help identify the source of the selenium.
He also said Wharf has been placing rock on the upper shelf area at Bald Mountain since the early 2000s. Blair asked if it was possible that rock is the source of the selenium, since state water quality data doesn’t show elevated selenium until well after that date. Zietlow said it has been discussed, but the source is still unknown.
The draft surface water discharge permit provides conditions for Wharf to bring False Bottom Springs back into compliance. Being in violation of the standard is grounds for denial by the Board. Buscher said the department is confident Wharf can mitigate the situation. During closing arguments, Blair said, the selenium situation at False Bottom should not cause denial of the permit, and the board should feel comfortable the situation is being remediated. Gubbrud agreed.
Wharf is required to present the findings of its pilot study, which aims to find the most appropriate mitigation solution, by August 1, 2023. Construction on the company's chosen solution must be completed by October 1, 2024, and be operational by January 1, 2025.
Wharf has 10 notices of violations in their file since mine operations first began, but none in the past 20 years, according to Hudson. Buscher said there are no spills affecting surface water recorded after 2011.
DANR issued a recommendation of conditional approval to Wharf for the Boston Expansion, stating it addresses all legal requirements. Their formal recommendation includes stipulations requiring Wharf to submit an annual surface and groundwater characterization report on or before March 1 each year; notify DANR within five working days of receiving any written complaints from landowners about dust, noise and blasting; and do tree-clearing operations outside of migratory bird nesting season.
The Board will make its decision during the July 20 meeting, after which Wharf will have 30 days to submit additional funds to cover increases in their reclamation and post-closure surety. If the permit is approved, active mining in the Boston Expansion area is expected to begin in the first quarter of 2024.
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