Minnesota Appeals Court sends PolyMet air permit back to state for review

The Minnesota Court of Appeals has ordered state regulators to re-examine an air emissions permit they issued to PolyMet Mining Corp. to determine whether the company misled them about the size of the copper-nickel mine it plans to build in northern Minnesota.

In its ruling Monday, the Appeals Court ordered the air pollution permit that PolyMet received from the Minnesota Pollution Control Agency (MPCA) back to the regulator to further consider whether the company deceptively sought a less stringent permit for a mine operation smaller than the one it actually planned.

That's called engaging in "sham permitting."

Writing for the court, Judge Lucinda Jesson said that the MPCA failed to adequately address "whether PolyMet had failed to disclose relevant facts or knowingly submitted false or misleading information."

The Appeals Court came to a similar conclusion last year, but PolyMet and the MPCA petitioned the state Supreme Court, which sent the air permit back to the Appeals Court.

The decision is one in a series of setbacks for the bitterly disputed project, which if built, would become Minnesota's first copper-nickel mine.

PolyMet can't start construction on the $1 billion mine near Hoyt Lakes and Babbitt until all its permits are cleared. Four of about 20 permits issued to the company have been revoked, suspended or require additional review: the air pollution permit, the water pollution permit, the permit to destroy wetlands and the company's main permit to mine.

Both PolyMet and the MPCA on Monday downplayed the significance of the Appeals Court decision.

PolyMet, based in St. Paul and majority owned by Glencore in Switzerland, issued a news release saying it was disappointed but confident that the MPCA handled the air permit issue appropriately. Metals such as copper and nickel need to be mined to support the clean energy future, the company said.

PolyMet remains committed to the project, company spokesman Bruce Richardson said in a statement to the Star Tribune. "We continue to move ahead despite all the roadblocks our opponents have attempted to place in our way," Richardson said.

MPCA spokesman Darin Broton said the decision merely requires the MPCA "to adequately explain" its decision to issue the air permit.

"While the agency is still reviewing the decision and determining its next steps, the MPCA is confident in its scrutiny of PolyMet's emissions calculations and the strong and enforceable air permit issued to the facility," Broton said.

Monday's ruling stemmed from appeals filed by several environmental groups and the Fond du Lac Band of Lake Superior Chippewa, who live on the St. Louis River downstream from the Iron Range mine project. The groups accused PolyMet of engaging in a bait-and-switch scheme with regulators and having plans to dramatically increase the size of the mine.

A key document in their case was a technical report submitted to Canadian securities authorities in which the company mentions expanding the mine to triple its permitted size.

In a joint news release Monday, the environmental groups said that Minnesota needs to reconsider the wisdom of the copper-nickel mine given the permit problems.

"It's time to move on from PolyMet and find better alternatives for northeastern Minnesota," said Kathryn Hoffman, director of the Minnesota Center for Environmental Advocacy.

Chris Knopf, executive director of the Friends of the Boundary Waters Wilderness, said that PolyMet "has been speaking out of both sides of its mouth trying to keep its plans for a bigger, dirtier mine hidden from the people of Minnesota."

The air pollution permit at issue limits the air emissions from PolyMet's proposed mine to 250 tons per year of any individual regulated air pollutant known as "criteria pollutants" — such as particulate matter, sulfur dioxide and nitrogen oxide. A larger operation would likely require a stricter, more time-consuming permit.

The permit does not regulate greenhouse gas emissions.

Minnesota has a long history of iron ore and taconite mining. PolyMet's copper-nickel project would be the state's first hard rock mine, a type of mining that poses greater environmental risks. That's because minerals such as copper are buried in sulfide-bearing rock that must be crushed for the copper to be released. When the sulfide is exposed to the elements it generates an acid that leaches toxic heavy metals that can pollute water.

A second copper-nickel mine in the state, one that Chilean mining giant Antofagasta wants to build just outside the Boundary Waters Canoe Area Wilderness, just started moving through the regulatory process.