Traverse City New legal challenge filed against UP nickel mine Group says project would damage river, nearby wetlands

By John Flesher

AP Environmental Writer

TRAVERSE CITY, Mich. (AP) -- A private club in Michigan's Upper Peninsula has filed a federal lawsuit to halt construction of a nickel and copper mine, saying Kennecott Eagle Minerals Co. did not obtain necessary federal permits.

The 250-member Huron Mountain Club, which owns 19,000 acres of forested property that comes within 3.3 miles of the mine site, contends the project under development in northwestern Marquette County would damage the Salmon Trout River and nearby wetlands. Also at risk are endangered species, club members' property values and a culturally significant site where American Indians worship, the club argues.

Activities that could do such damage require permits from the U.S. Army Corps of Engineers, according to the lawsuit, which was filed Sunday in U.S. District Court in Grand Rapids. The suit targets Kennecott Eagle for not getting the permits, and the Corps and other federal agencies for failing to demand the company seek them.

"Kennecott's unauthorized construction work and proposed operation of the Eagle Mine consequently are illegal," the suit said.

Judge Robert Holmes Bell rejected the club's request for an order to immediately halt work on the mine, but scheduled a hearing for June 6.

The suit is the latest potential legal hurdle for Kennecott Eagle, a subsidiary of London-based Rio Tinto, which is targeting an ore deposit expected to yield up to 300 million pounds of nickel and 200 million pounds of copper. The mine would be the only one in the U.S. devoted primarily to production of nickel, an ingredient in stainless steel and products such as batteries, magnets and ceramics.

Kennecott Eagle applied for a state permit to construct the mine in 2006. The Michigan Department of Environmental Quality approved it the next year, a decision upheld by an administrative law judge. Opponents, including the Huron Mountain Club, have asked the state Court of Appeals to take the case.

The company has nearly finished construction on surface facilities, while the drilling of an underground tunnel to the ore body is about halfway complete, spokesman Deb Muchmore said. Kennecott Eagle plans to begin extracting minerals next year.

"While we have not had the opportunity to review the claims of the suit, we will vigorously defend our legal position," Kennecott Eagle President Adam Burley said in a statement. "We will also defend the jobs of our workers and those the project has created in Michigan's Upper Peninsula."

Portions of the mine will be drilled directly beneath the Salmon Trout river, home to the rare coaster brook trout. As groundwater seeps into the subterranean chambers, the river's level will drop and adjacent wetlands will shrink, the lawsuit says. It contends the waterways also will be affected as the company places fill material in the chambers after ore is removed.

The suit argues that the federal Clean Water Act and the Rivers and Harbors Appropriations Act require permits from the Army corps for such activity.

Before issuing the permits, the corps would have to analyze potential effects on the environment, threatened and endangered species and Eagle Rock, a 60-foot-high outcrop near the tunnel entrance, said Rick Addison, an attorney for the Huron Mountain Club. The Keweenaw Bay Indian Community says the rock is a sacred site where generations of tribal members have worshipped. The company has fenced off the rock and promises to grant access for religious ceremonies.

Federal regulators have mostly steered clear of the Kennecott project. The Environmental Protection Agency originally said it would need a wastewater discharge permit but dropped the requirement after the company changed its system.

Lynn Rose, a spokeswoman for the Army corps' Detroit district, declined comment on the lawsuit.

Published: Wed, May 9, 2012