Clinton Unveils Deal to Stop Yellowstone Mine


Proclaiming Yellowstone National Park “more precious than gold,” President Clinton on Monday announced a deal to end a proposed massive gold mining venture on the edge of the nation’s oldest park.

Clinton took time away from his Wyoming vacation to endorse the agreement, under which the owners of the New World Mine would receive federal lands of comparable value in exchange for cleaning up the Yellowstone site north of here and surrendering all rights to its minerals.

The venture has been the subject of a fierce legal and public relations battle between environmentalists and Crown Butte Mines, owner of the New World Mine property.

The announcement permitted Clinton to burnish his environmental credentials at a time when this week’s Republican convention in San Diego is beginning to dominate the national news and little attention is flowing his way.


On a visit to Wyoming last year, Clinton declared a moratorium on development of the mine pending negotiations involving the government, ecology groups and the mine owners.

“The American people and our future win because Yellowstone will be protected from the environmental hazards of mining,” Clinton said Monday. “Crown Butte’s shareholders win because their property rights will be protected. We are all protected from years and years of expensive and bitter litigation.”

The deal leaves several critical questions unanswered, however. Chief among them being where the government will find land worth the $65 million needed to compensate New World for its investment that would have comparable development potential. The mine operators estimated that the site contains $650 million to $800 million worth of gold, silver and copper.

Under terms of the agreement, the land must be acceptable to the company, a provision that could lead to months or years of negotiation and, possibly, litigation.

Clinton acknowledged that the settlement will affect the economy of Montana and northwest Wyoming adversely and will cost hundreds of high-paying jobs.

However, he said, “we can’t have mines everywhere, and mines that could threaten any national treasures like Yellowstone--that’s too much to ask of the American people.”

Ian Bayer, president of Battle Mountain Gold Co., the Houston-based parent of Crown Butte, appeared with Clinton Monday to initial the agreement. Both companies are controlled by Noranda, a multibillion-dollar natural resources concern based in Toronto.

Bayer said officials of Crown Butte had done a “180-degree turnaround” in the last few months as they came to realize that they faced years of expensive litigation and public opprobrium if they insisted on going through with the mine venture.


“We are passionate about protecting the environment,” Bayer said. “The greater Yellowstone region is one of the most magnificent places on earth. It is our sincere hope . . . [that] the conservation community and the mining community find a common ground.”

The primary threat from mining in the region is in the disposal of millions of tons of mining waste, or “tailings.” The mine operators proposed to build a gigantic impoundment pool to collect the waste, which contains highly acidic compounds that quickly kill fish and other wildlife.

The site is in an area of earthquake activity and receives more than 30 feet of snowfall a year, making runoff from the waste pit likely, opponents said.

Environmentalists hailed Monday’s announcement. Several dozen mine opponents witnessed the Yellowstone event and whooped when Mike Clark, director of the Greater Yellowstone Coalition, welcomed them to “the ceremony that marks the end of development of the New World Mine.”


Clark, who spoke on behalf of a half-dozen local and national groups opposed to the mine, said Yellowstone deserved protection as “one of the few remaining truly wild places in the world.”

Another mine opponent has been American Rivers, a group that identified the nearby Clarks Fork of the Yellowstone River as the most endangered river in the United States because of the proposed mining activity.

The organization’s president, Rebecca Wodder, applauded the deal but said Congress must act to overturn the 1872 law under which Crown Butte won rights to extract minerals from the land.

The law, passed at a time when the nation was opening up vast tracts of western land to mineral development, requires the sale of federal property for $5 an acre. The underlying minerals, no matter what their value, are given to the developers at no cost and with no royalties paid to the government.


“This obsolete law is corporate welfare at its worst,” Wodder said in a press release issued Monday. She called for repeal of the law and additional legislation to ensure permanent protection of the Yellowstone site from future mining.

Crown Butte’s leading investment in the land is $37 million for exploration. The corporation will be required to place $22.5 million in escrow to pay for cleanup of the property, which has seen decades of mining activity, much of it predating Crown Butte’s ownership.