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State Requires Reclamation
To Begin At Molycorp

New Requirement Seen As Providing Health and Economic Benefits For Questa

On June 3, 2002 the New Mexico Mining and Minerals Division (MMD) approved and signed Molycorp's closeout plan and permit for the molybdenum mine in Questa, NM. The permit removes 2,247 acres from future mining and requires that reclamation of the mine begin this summer.

Amigos Bravos, a river conservation organization that has been involved in numerous negotiations with the State and the mine, declared victory today. "We have been waiting for over fourteen years for this moment," said Brian Shields, Executive Director of Amigos Bravos. "To restore the Red River we have to first stop the pollution from the mine, and the only long term-solution to such chronic and widespread pollution is to fully reclaim the mine. Now, that work can begin."

The new permit represents some major breakthroughs for environmental and community activists concerned about human health and pollution of the Red River. Most significant is the mine's agreement to speed up reclamation. Under State statute, the mine is not required to begin reclamation until after it closes, which could be as long as forty years from now. Under the new permit, Molycorp will be required to invest a minimum of three million dollars a year in reclamation activities, starting this year.

In addition to the human and environmental health benefits of cleaning up the pollution, environmental restoration will provide a significant economic benefit for the Questa community. The permit, which contains a maze of 62 conditions including numerous studies, carries with it a $134,088,000 bond for the eventual cleanup and restoration of the mine site. The bond will only be released when the stringent conditions for successful reclamation, which will require very substantial spending by Molycorp/Unocal, are met.

The new permit establishes some precedent-setting standards not required by state law -- including:

1. Withdrawal of 2,247 acres from future mining.
2. Mine reclamation will start this year instead of waiting till the mine closes -- Molycorp has committed to spend a minimum of $3 million a year on reclamation activities.
3. A large and comprehensive revegetation test plot program will establish 100 acres of test plots by 2003 -- this will allow testing of alternative revegetation scenarios, a critical area for preventing groundwater contamination and erosion of contaminated surface materials.
4. A Technical Review Committee, consisting of representatives of all the stakeholders, will continue to meet -- and critically assess restoration progress -- through the revision of the permit in 2004.
5. The permit calls for a revision of the permit if wildlife is being negatively impacted, and
6. The open pit will be partially reclaimed.

The permit will be revised in 2004 to incorporate new information from the studies. Through many months of negotiations under the direction of MMD, the permit issued today underwent over 25 revisions.

Parties to the negotiations included the New Mexico Environment Department, Molycorp and Amigos Bravos, a statewide river conservation organization with offices in Albuquerque and Taos. Amigos Bravos was represented by the New Mexico Environmental Law Center of Santa Fe, the Center for Science in Public Participation of Bozeman, Montana, the Western Environmental Law Center of Taos, and the Southwest Research and Information Center of Albuquerque.

Still to be resolved, and sure to be a focus of the 2004 revision, is what to do with subsidence areas. Subsidence is a direct outcome of large-scale underground mining, which Molycorp has been practicing for nearly twenty years. When the ore is extracted the underground mined areas collapse leading to subsidence at the surface. These subsidence areas are composed of rubble-ized material that is highly unstable and creates new pathways for water contamination to reach the river. Under the new permit agreement Molycorp has until 2004 to develop a plan for reclaiming over 200 acres of subsidence at the mine. Initial research conducted by the Center for Science in Public Participation has been unable to find any instances where subsidence areas have been successfully reclaimed. "Developing a good reclamation plan for subsidence areas will be critical for the continuation of underground mining at Molycorp," said Doug Wolf, lead attorney with the New Mexico Environmental Law Center. "The New Mexico Mining Act prohibits [the creation of] mining impacts that can not be reclaimed."