Article Published: Tuesday, April 06, 2004

of mining patents roils Crested Butte residents

By Steve Lipsher
Denver Post Mountain Bureau

For $875, the Bush administration last week sold 155 acres of federal land near Crested Butte to a multinational mining company, renewing one of the nation's longest-running legal battles over a mine proposal.

The purchase, revealed late Friday, outraged local officials and environmentalists who have been fighting efforts to open a mine on Mount Emmons for more than 30 years.

The federal Bureau of Land Management dismissed three formal protests and immediately turned over the patents to nine claims on U.S. Forest Service land to the Phelps Dodge Corp.

Critics say the transfer of the unrestricted patents - essentially the deeds to the property - is a land grab based on deceit and false assumptions that will allow the company to develop the property or sell it for a robust profit.

"For less than $1,000, Phelps Dodge has acquired 150 acres of federal property next to a resort town where a tenth-of-an-acre lot is selling for $100,000," said Jim Schmidt, mayor of Crested Butte.

"Obviously the concern is that the mining company has just gained a bunch of U.S. property ... that they can use for mining or development or whatever," he said.

A ruling by BLM Director Kathleen Clarke dismissed protests filed by the High Country Citizens' Alliance, the town of Crested Butte and Gunnison County, and led to the immediate issuance of the patents.

"In general, the protesters' allegations regarding why they believe the Department of the Interior should reject Mount Emmons' patent application are unsupported in fact and in law," Clarke wrote in the April 2 decision.

Officials at the BLM, the Interior Department agency that handles mining patents for all federal lands, declined to comment Monday, saying that any statements would have to be cleared first by the agency's attorneys in Washington and would not be forthcoming. Phelps Dodge spokesman Ken Vaughn said company officials haven't decided whether to proceed with a new mine.

He said that the company is in litigation with the previous owner, U.S. Energy. Citing that federal civil suit, Vaughn declined to comment on the newly awarded patents or criticism of that move.

Phelps Dodge operates the Henderson molybdenum mine in Grand and Summit counties and owns the dormant Climax mine in Lake County.

The administration's decision comes during a nationwide moratorium on issuing new mining patents, but federal courts have ruled that the sale of the 155 acres near Crested Butte, originally proposed in 1992, could be grandfathered in.

The federal Mining Act of 1872 requires the government to sell mining patents at $5 per acre, one of the many antiquated provisions challenged by critics such as the High Country Citizens Alliance. That organization formed in the mid 1970s specifically to fight proposals for mining on Mount Emmons, and the group says their case is the oldest ongoing legal battle over mining in the county.

Groups such as the alliance question the motives of the BLM, the process by which it reached its decision, and predict a legal challenge.

"These issues are too important to let this travesty go unchallenged," said Roger Flynn, director of the Western Mine Action Project, a nonprofit legal organization that monitors mining operations.

His organization spearheaded a campaign against the sale, arguing that the mine would not be a viable business under today's economic and regulatory climate - a requirement for obtaining a mine patent.

Few observers believe that Phelps Dodge will open a molybdenum mine on Mount Emmons, known locally as "the Red Lady." They cite the company's own acknowledgment that molybdenum is more readily available from existing mines in Colorado, in Arizona and throughout the world.

"I think the reality in the molybdenum market, at least now and for the foreseeable future, doesn't make any sense to do any mining up there," said Crested Butte town manager Frank Bell. "That could change."

In her ruling, Clarke cited studies indicating the mine would operate 24 hours a day for 11 years, producing as much as $158 million in after-tax profits.

"We think they overinflated the price of molybdenum, and they lowballed the cost," Flynn said. "The Bush administration apparently had no problem with Phelps Dodge saying: 'This is a viable operation.' It's really not based on any credible reading of reality."

For more than 30 years, locals in the former mining community have fought efforts by a series of property owners to renew mining on Mount Emmons, 3 miles west of the Crested Butte ski area.

Once, Mayor W. Mitchell, who used a wheelchair to get around, was flown to the top of the mountain in a helicopter in protest, and the town to this day still holds the annual "Red Lady Ball" to raise money to fight other mining efforts.

"It was really back when the community opposed the Amax attempt to mine the deposit in the early 1980s that the community said its destiny was being a tourism resort area," said Jim Starr, a Gunnison County commissioner who represents the area.

He complained that the BLM, an agency that just last month vowed greater involvement and communication with local governments over public-land decisions, hadn't bothered to notify any of the organizations that filed appeals.

"That absolutely did not happen here," he said. "And really, as an elected official, it makes you wonder how sincere those efforts are."



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