Friday, February 01, 2008

Hardrock mining bill Senate hearing

There wasn't much local press coverage of last week's U.S. Senate hearing on the hardrock mining bill, so here's a summary prepared by the AGI Government Affairs Program:

Hardrock Mining Law Reform Receives a Senate Hearing
Last year the House passed a hardrock mining law reform bill (H.R. 2262) that would impose 8 percent royalties on the gross returns on minerals from new claims and a 4 percent royalty on existing claims with part of these proceeds marked for cleanup of thousands of abandoned mines across the country. The measure would also grant federal and state authorities more control over where hardrock mining can be conducted.

On January 24, 2008 the Senate Energy and Natural Resources Committee held a hearing on hardrock mining reform and asked a bevy of diverse witnesses about the pros and cons of the House bill and what the Senate Committee should consider in any Senate legislation. William Cobb of the National Mining Association called the added controls on mining an undue regulatory burden. Mike Dombeck of Trout Unlimited and a former head of both the U.S. Forest Service and the Bureau of Land Management indicated that land managers have little say over mining sites compared to oil and natural gas developments and this lack of oversight needs to be fixed. James Otto an independent consultant favored a gross royalty over a net-proceeds royalty but noted that an 8 percent royalty would be the highest in the world.

Senator Pete Domenici (R-NM) called for the Senate to consider drafting a completely new bill versus compromising on the House bill. Chairman Jeff Bingaman (D-NM) and Senator Lisa Murkowski (R-AK) thought that more analysis of the royalty structure was needed before deciding on any numbers.

Discussions about hardrock mining reform are likely to continue in both chambers, however, it is unclear whether the Senate will draft their own bill or consider revisions to the House bill. Input from stakeholders to the Senate Energy and Natural Resources Committee and the House Natural Resources Committee would probably be of value throughout the year even if legislation is not finalized.

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