Companies that Don't Clean Up After Themselves

Remember the market, that perfectly efficient generator of wealth and goodness that can do no wrong? Well, it ain't working very well for natural gas. So many goombahs have jumped into the fracking boom that the price of gas has collapsed. Many drillers have gone bust, leaving private property owners, states and the Bureau of Land Management to clean up their messes.

Case in point: Wyoming. According to a story in The New York Times:

Hundreds of abandoned drilling wells dot eastern Wyoming like sagebrush, vestiges of a natural gas boom that has been drying up in recent years as prices have plummeted.

The companies that once operated the wells have all but vanished into the prairie, many seeking bankruptcy protection and unable to pay the cost of reclaiming the land they leased. Recent estimates have put the number of abandoned drilling operations in Wyoming at more than 1,200, and state officials said several thousand more might soon be orphaned by their operators [2,300 are idle but have not been abandoned].

Wyoming officials are now trying to address the problem amid concerns from landowners that the wells could contaminate groundwater and are a blight on the land.

When these companies declare bankruptcy the weasels who promised to clean up after themselves disappear into the wind, leaving the local people to live with toxic waste and water that burns when it comes out of their wells. In Wyoming drillers pay a paltry fixed amount to cover cleanup costs, regardless of how many wells they drill: it's nowhere near the amount needed to pay for all the wells the drillers have abandoned.

Wyoming is now on the hook for tens of millions of dollars in cleanup costs. In a few years states like North Dakota that are raking in cash now will be digging themselves out of another toxic mess. But there's another similar threat appearing in Minnesota, one that should be nipped in the bud before it festers.

PolyMet Mining is a newly formed Swiss-backed Canadian company set up to exploit copper and nickel deposits in northern Minnesota, near the Boundary Waters Canoe Area (BWCA). The metals are bound into sulfide rocks in very low concentrations: less than half a percent. The metals are mined by grinding up the rock in huge open pits and processing it to extract the metals, freeing sulfides in the process. Each ton of rock will produce only a few pounds of copper or nickel.

PolyMet is promising that they'll provide a couple of hundred local jobs for 20 years. However, the tailings from these mines will leach toxins like sulfuric acid and arsenic for the next 500 years. If these wastes run off into the lakes, streams and rivers in the area, it would decimate wildlife in the area, making the BWCA unusable. If the runoff reaches Lake Superior, it will kill fish and wildlife there as well.

PolyMet has promised to provide ongoing mitigation for the next five centuries. But as we've seen, companies simply cannot be trusted to make those kinds of promises, for even five, 10 or 20 years. Anyone promising to clean up the site for 500 years is simply lying. The foreign owners of the company don't give a damn about what happens to the land or the people after they've extracted the precious metals; the subsidiary of the international monolith that owns PolyMet will simply declare bankruptcy when the metals are all gone and walk away leaving a horrible, expensive mess.

Northern Minnesota already has already gone through this before: in 1960s and '70s Reserve Mining Company dumped tons of taconite tailings from their iron mining operations into Lake Superior every minute, polluting the lake with carcinogenic asbestos fibers. Lake Superior provides drinking water for cities on the lake. Miners also got mesothelioma from the asbestos. Reserve Mining was sued multiple times and declared bankruptcy in 1986.

The underlying problem with resources like natural gas, crude oil, iron, copper and nickel is that the price doesn't depend on how much it costs to clean up the mess that extracting them produces: it depends on much customers are willing to pay. The cost of extraction, cleanup and pollution mitigation varies wildly depending on the local geology and climate. A copper mine in a Utah desert isn't going to have the same pollution mitigation costs as a copper mine in the Land of 10,000 Lakes. But now that is that we've exhausted all the deposits where mining and mitigation are cheap we're looking to places where it's more expensive and more dangerous.

Just as not every high-school football player can expect to play in the NFL, not every copper and nickel deposit can be mined at an acceptable economical and ecological cost. Reflexively "Saying "Not in My Backyard" is just as bad as plunging ahead with every hare-brained scheme a foreign bamboozler comes up with.

Northern Minnesota is just too wet to safely exploit low-concentration metal deposits with current technology. The BWCA provides thousands of permanent jobs in tourism and recreation: it makes no sense to risk the loss of those jobs when -- not if -- PolyMet fails to live up to its word to keep the lakes and steams clean.

Anyway, why do we need so much copper and nickel in the first place? Electronics: everyone is buying a new smartphone and a new tablet every year. This suggests a more reasonable alternative: instead of trashing pristine places like the BWCA, why aren't we building these devices so that their component metals can be efficiently recycled, rather than just dumped in landfills?

That would make the phones cost more. But shouldn't the gluttonous people who cause a problem pay for its solution, rather than dumping all the environmental cleanup costs on the people who happen to live near the mines?