The federal government has no idea how much gold, copper and other hard-rock minerals are being extracted from public lands each year — nor how much the minerals are worth — because the companies licensed to operate the mines pay no royalties, according to a report the Government Accountability Office will make public Wednesday.
The new report, requested by Rep. Raul M. Grijalva (D-Ariz.) and Sen. Tom Udall (D-N.M.), could spur a renewed push to reform the 140-year-old law governing U.S. hard-rock mining. Under the General Mining Act of 1872, the government charges mining companies $189 to locate a claim and then $140 annually to maintain it after the first year. What the companies extract from public terrain is theirs to sell on the open market.
Last year, Interior Secretary Ken Salazar and Robert Abbey, then Bureau of Land Management director, reached out behind the scenes to some American mining companies, raising the idea of charging royalties based on the companies’ net revenue from their federal-land operations. Abbey, who retired from the agency earlier this year, said in an interview that he believes a compromise could be struck.
“They’re walking away with really significant revenues . . . with no return to the American taxpayers,” Abbey said.
While both Democrats and Republicans have tried to overhaul the nation’s mining laws for decades — Udall’s father, Interior Secretary Stewart Udall, called it “the most important piece of unfinished business on the nation’s resource agenda” when he left Lyndon B. Johnson’s Cabinet in 1969 — neither party has managed to overcome industry opposition.
Responding to an inquiry last year from Grijalva about the value of uranium that Denison Mines Corp. had extracted from public land, company chief executive Ron F. Hochstein did not divulge any specific figures. But he said the metal ore industry overall accounted for nearly 290,000 jobs and contributed $37.2 billion to the nation’s gross domestic product, according to an industry-commissioned PricewaterhouseCoopers study.
Grijalva, who called mining firms “outright arrogant” for failing to disclose what they’re taking from public lands, said at a minimum these companies should report the volume and value of what they’re extracting.