Cyanide’s Bitter End in Mining for Gold

It was an old alchemist’s trick, dripping deadly cyanide onto a piece of rock to burn out its hidden stores of gold. Two decades ago, Pegasus Gold Inc. turned ancient art into modern riches, building a network of cyanide mines in the Little Rocky Mountains and transforming 38,000 tons a day of some of the lowest-grade ore in the world into Montana’s biggest gold mine.

After hauling 46 tons of gold out of the barren hills, Pegasus Gold Inc. earlier this year filed for bankruptcy and began shutdown operations at its landmark Zortman-Landusky Mine. But its legacy remains.

The town of Zortman had to turn to a new municipal water source after the old one was polluted with 50,000 gallons of cyanide. Nearby Ruby Gulch was contaminated with arsenic, cadmium, chromium and copper. And two Indian tribes are demanding studies to investigate lead poisoning of their children that they suspect comes from acid mine drainage that leaked out of the hill they once called “Spirit Mountain.”

Earlier this month, Montana voters struck back. In a ballot initiative unprecedented in a state literally built on mining, voters approved a ban on new cyanide heap-leach mining, a century-old technology that entered the modern era at mines like Zortman-Landusky and became the most important new tool for extracting gold and silver out of low-grade ore.

The initiative, immediately challenged in court by the industry, will halt a huge new gold mine contemplated on the banks of the fabled Blackfoot River and at least one other gold mine nearing operation at Dillon. Industry officials say it could block exploration and start-up activities at 15 other mines and cost the state at least $214 million a year in taxes and royalties.

The election was followed closely throughout the mining industry, which sees Montana as the forerunner in what is likely to be an attempt throughout the West to do away with cyanide gold mining. Environmentalists hope the vote will strengthen support in Congress to reform the 1872 law on hard rock mining that allows virtually anyone to stake a mining claim on public land, pay no royalties for the minerals extracted and assume little or no responsibility for reclamation.

The initiative stands as the most significant challenge to mining in a state that was once a virtual company town of the Anaconda Copper Co., a state whose flag carries the slogan “ora y plata,” or “gold and silver.” Mining is a $2.2-billion industry that directly employs about 2,100 workers in gold and silver (about half the mining jobs in the state) and indirectly provides employment for as many as 27,000. Mineral-rich counties derive up to a third of their tax revenues from mining royalties and taxes.

“I think there’s a concerted effort to drive mining out of the state, and I think it’s one of the stupidest things you could do,” said Jill Anderson of the Montana Mining Assn., which has filed two legal challenges to Initiative 137. “Agriculture is hurting badly. Our timber, when we can cut it, we can’t sell it for anything. I’m just not sure where Montanans are going to have jobs.”

A History of Spills and Polluted Rivers

Proponents of the initiative, which won 53% of the vote, say the mining industry dug its own grave. Its record, they say, is a story of dug-up hillsides, leaks and spills, polluted rivers and poisoned ground water. Since 1982, Montana mines have released 135 million gallons of cyanide, according to environmentalists.

“I’ve been all over the country looking at these mines. And every place I’ve been, from South Carolina to California and Nevada, every single one has leaked,” said Jim Jensen of the Montana Environmental Information Center, a backer of the initiative. “The conventional wisdom is that in the West, the mining industry is absolute. I-137 shows that, if people are actually given an independent outlet for their voice, it’s time for reform.”

Those challenging the initiative, are focusing on a 1996 ballot measure that prevented corporate contributions to initiative campaigns. The result was that the mining industry could not be heard on the mining measure until just two weeks before the election, when a federal judge declared the earlier measure unconstitutional.

“We believe the initiative will be overturned on the basis of the fact that we, the mining community, had no opportunity to effectively campaign against it until just a few days prior to the vote. Our hands were tied,” said Canyon Resources President Richard H. De Voto.

Jensen said proponents, expecting a challenge, did not begin their own TV campaign until the judge had ruled. Once unleashed, the mining industry struck with full force, he said, spending $2.5 million to the proponents’ $300,000. Estimates are that 95% of all Montanans heard the industry’s anti-initiative message not once but at least 25 times.

The technology of leach mining goes back to the 1860s, but it was only in the late 1970s that companies like Spokane, Wash.-based Pegasus began applying cyanide to huge quantities of low-grade ore to recover gold present in such low concentrations that it would otherwise be considered unminable. The result: More gold has been recovered in the U.S. over the last two decades than was produced in the entire previous century.

Suddenly, abandoned mining claims took on a new allure. By digging up entire hillsides, laying them on a plastic- and clay-lined leach pad and sprinkling cyanide over them, mining companies were able to collect the gold that ran out the bottom.

51 Releases of Cyanide Documented

The problem has been the leaks that often form in the leach pads, permitting cyanide and heavy metals to escape. Most often, the mine is able to contain the leak and recycle the runoff before it damages anything, but stories abound of mine runoff leaking into creeks, ground water and wells.

In its campaign for I-137, the Montana Environmental Information Center documented 51 cyanide releases at Montana mines since 1982, most recently a nearly two-month-long cyanide leak at the Golden Sunlight Mine near Whitehall this summer that was followed by elevated cyanide levels in nearby wells.

In 1997, Pegasus agreed to pay $37 million to settle a federal Environmental Protection Agency lawsuit over water quality violations at Zortman-Landusky, most due to acid mine drainage. The Kendall Mine near Lewistown was fined $330,000 earlier this year for polluting nearby waters with nitrates, thallium, selenium, manganese, arsenic and cyanide.

While cyanide exposed to air readily breaks down into compounds that are probably less harmful, cyanide in the ground water can persist as one of the most powerful poisons known to man. Heavy metals that can form an acid and leach out along with the gold present an equally serious health hazard.

Stephanie Shammel, who with her husband raises 280 head of cattle just below the Kendall mine, found evidence in 1996 of heavy metals and nitrates in the well that waters her cattle. Neighbors found the same thing, in addition to arsenic, and one rancher lost three cows.

Mine owner Canyon Resources Inc. installed a pump-back system to halt the pollution--essentially capturing all the polluted runoff before it left the site and running it through snow machines to evaporate it. That stopped the pollution--but it also stopped the water. Shammel’s watering well, reliable for the 105 years her husband’s family has owned the ranch, went dry.

“My husband has spent most of the fall trying to find water,” Shammel said. The company has since provided a clean new source of water for the Shammels, but the couple became active in the I-137 campaign nonetheless. “We don’t want somebody else to have to go to court just to protect your property, to have to battle daily just to get your water cleaned,” Shammel said. “The gold will be there, they can find a better way to mine it, without destroying everything around it.”

Canyon Resources turned next to the town of Lincoln, and a site near the headwaters of the Blackfoot River, made famous by Norman Maclean’s anthem to fly fishing, “A River Runs Through It.” It is a river Jensen calls “a cosmic river.”

Winding heavy with trout through lodgepole pine and alder out of the Rocky Mountains down toward Missoula, the headwaters of the Blackfoot happen to be almost directly adjacent to what Canyon Resources believes is the largest undeveloped gold reserve in North America.

The company, along with its former partner, Phelps Dodge Corp., had already spent $70 million on preliminary exploration and studies for the McDonald Gold Project that would involve digging a square-mile pit 1,200 feet deep, producing 450 million tons of waste rock and pumping 2.5 million gallons of water a day.

Project developers say new technology has benefited from the mistakes of the past and pledge McDonald would not allow an ounce of waste water to escape into the Blackfoot. The nearby town of Lincoln was largely behind a project that would have brought 387 new jobs and substantial tax revenues to the community, had it not been halted in its tracks by I-137. But a number of ranchers along the Blackfoot have been quietly celebratory about its demise.

Jon Krutar, raised by a bachelor miner after his father was killed in a mining accident, has founded a group called Blackfoot Legacy committed to maintaining the health of the river. The rancher tells his neighbors that the community would make more money protecting its river than a mine could ever bring.

“How dare they take the moral high ground and claim they’re the only ones in this state who make their living by their hands and their back?” added Mark Gerlach, a ranch foreman on the Blackfoot who also supported the initiative. For his efforts, he has had phone calls in the middle of the night, threatening to shoot him and burn his house.

“Yeah, the mining industry creates long-term jobs--if you work in a water treatment plant,” Gerlach said. “It’s like an insane, headlong rush to turn Montana into a Third World country.”

Just a block off Lincoln’s main intersection, K.D. Feeback sips a cup of coffee through his handlebar mustache and considers Jensen’s description of the Blackfoot as a cosmic river, then points his index finger at the back of his throat.

“Our society, our technological advances, have made life so easy for people that they tend to stray from their roots. They don’t spend a lot of time worrying about where a 2-by-4 came from, or metals, or meat,” said Feeback, who was employed as a geologist on the McDonald project until he got laid off recently. “You know, I really wonder about Montana.”

“Mining is what started Montana, back in the 1850s, but there’s been a growing group of obstructionists who think the economy can be supported by service-sector employment,” added Bill Snoddy, spokesman for the McDonald project. “We are now 50th in the nation for average annual income. So you take the kids out of high school, point ‘em away from Montana, and no matter what state they land in, they can expect a larger average wage. Which is really sad.”

Ban Lacks Scientific Basis, Governor Says

Republican Gov. Marc Racicot opposed I-137, calling it “a complete ban on the future use of cyanide without any sound scientific justification.”

“The taxpayers of Montana have spent tens of millions of dollars to clean up petroleum leaks and spills. Yet no one is advocating a complete ban on the use of gasoline,” Racicot said.

“In fact, yes, virtually every mine has had some kind of a leak at some point in time in Montana, and although those have been sometimes fairly large leaks, by the time they’ve been stopped and controlled, there has been very little in the way of either environmental harm or public health harm,” added Mark Simonich, director of the state Department of Environmental Quality.

For Don Marble, an attorney representing some of the Native Americans at the Fort Belknap Indian Reservation near the Zortman-Landusky mine, it isn’t hard to understand why the measure passed.

“The place where Landusky Pit is was their Spirit Mountain. And now it’s just gone. It’s a big, ugly hole in the ground,” Marble said. “It’s pretty incredible to see what people do with the aid and consent of our own government.”