[Water_news] 4. DWR'S CALIFORNIA WATER NEWS: WATER QUALITY - 4/27/07

Department of Water Resources

California Water News

A daily compilation of significant news articles and comment

 

April 27, 2007

 

4. Water Quality

 

Grass Valley Takes On Mining Giant Newmont; Council approves transfer of $1.1 million General Fund reserves to cover litigation costs up to trial

By YubaNet – 4/26/07

 

After seven years of fruitless wrangling with Newmont Mining Corporation, the world's second-largest gold producer, the Sierra Nevada foothill town of Grass Valley is seeking justice in federal court. The trial is slated to begin on Sept. 11 in Sacramento.

On a daily basis, Newmont is discharging hundreds of thousands of gallons of toxic mine effluent that flows onto city property. Grass Valley taxpayers have been footing the bill for treating the polluted water since 2000, when the city determined the source of the contaminated discharge.

At Tuesday's city council meeting, Mayor Mark Johnson expressed confidence in the city's ability to prevail and to replace city funds that have to be shifted in order to proceed with the lawsuit.

White Paper: "Grass Valley Sues Newmont Mining Corp"

Interim City Administrator Jeffrey Foltz summarized the main points of a white paper he presented to the council. The following is the full text of the two-page document:

"At the turn of the new millennium the City of Grass Valley found itself paying to treat hundreds of thousands of gallons of water each day that discharged onto its property from underground mine workings that are the responsibility of Newmont Mining Corporation.

Gold veins in Grass Valley were first discovered and mined in the 1850's. By 1929, many of the mines were consolidated under Empire Star Mines Company Limited, which was created and controlled by Newmont. Beginning in 1929, Newmont owned and operated the mines under approximately 6000 acres in Grass Valley. The names of the various entities changed over time, but Newmont was always the beneficiary of the mining activity.

In the 1950's, the Newmont entity that owned and operated the Empire Star Mines decided to stop mining, and to allow the mines to fill with water. The mines shut down in 1956 or 1957, but there is no evidence that Newmont conducted any sort of clean up.

In 2000, while expanding and improving the wastewater treatment plant, the City determined the source of a long-standing spring as a mine tunnel. The City immediately contacted the appropriate regulatory agencies, and under their guidance took the mine drainage into the plant for treatment. At the time, the City expected this to be a temporary solution.

>From 2000 to 2004 the City made every effort to persuade Newmont to take responsibility for cleaning the water or removing it from City property. Although Newmont participated in discussions with the City initially, and even shared in the cost of a study to determine the levels of contamination, Newmont eventually refused to take responsibility for the long term costs of dealing with the mine drainage. Newmont has continued to claim that it is not responsible for the contamination. Over time, this has left the City with no option but to seek legal redress from Newmont Mining Corporation and its many agents, subsidiaries and related corporations that have owned and operated the properties over time.

It is common knowledge in the wastewater industry that mine water should not be put through a municipal wastewater treatment facility for an extended period of time. The municipal wastewater treatment plant operates as a biological process, whereas a physical/chemical process is used to remove metals from mine waste. Lack of organic waste in the mine water and its acidity and cold temperature adversely affect the biological treatment, and costs the City of Grass Valley more to process the water. The bottom line is the Newmont wastewater does not belong in the City's wastewater treatment plant.

Newmont's wastewater, which is particularly high in manganese, affects the City's design flow of biological waste through the 2.78 million gallon per day (MGD) treatment plant. The City's treatment plant was upgraded to 2.78 MGD in 2000 to provide for the growth of the City. Today, the City's wastewater plant utilized approximately 1.6 MGD of the capacity, including Newmont's daily flow of about 0.4 MGD, which takes up much precious and expensive sewer treatment capacity paid for the community of Grass Valley.

To date, the City has been forced to spend $1.3 million to prepare for trail, which is scheduled to begin in September, 2007. The City has needed experts to analyze the contamination and its sources, consultants to determine the historical ownership and operation of the mines, and attorneys to compel Newmont to take responsibility for the contamination. The City is having to utilize its General Fund Reserves to take its case to court against Newmont Mining Corporation.

In support of the City's legal team of Meyers Nave attorneys, Grass Valley has also retained the legal services of Miller, Axline and Sawyer, a prestigious law firm representing government agencies against large corporations. They have proven to be very successful on a contingency basis. The City feels very confident in our legal team. The legal team is demanding that Newmont take responsibility for their waste stream, to pay Grass Valley for its legal fees and is also seeking punitive damages against Newmont.

The City, as recently as this month, continues to notify Newmont that it is in violation of the City's industrial pretreatment ordinance. The state agency which regulates state waterways has taken an interest in the City's plight, and may assist the City in helping enforce the City ordinance as it relates to industrial waste discharge. The City has scheduled a meeting in May with the State regulators regarding the enforcement of City ordinances and State law. The City hopes to obtain the State's support as to continuing enforcement actions against Newmont."

Mayor Assures the Public

Following Foltz's presentation, Mayor Johnson shared his thoughts on the situation. Here are a few of his remarks:

"... We've attempted to work issues out with Newmont and they have not worked out so we're pushing forward. It's been a challenge, it's hard I bet for the public to read and to hear about the costs the city's incurred, it's costs I wish that we didn't have to incur but when we're dealing with such a large corporation I don't think that really wants to take responsibility for what it's doing to our wastewater treatment plant, we're really left with that challenge. Now we have several good attorney firms working with us. We're going to be going to federal court in Sacramento in mid-September so there's going to be more costs incurred but I hope we prevail because in essence what we've done, we have drained all of our sewer treatment fund reserves and we hold those reserves to do projects including sewer lines, making improvements at our sewer treatment plant, anything related to our wastewater system. We have taken all the money from that, we have no reserves…We're going to be shifting some money from our General Fund reserves back over to that fund so we will have money available for those improvements…"

Because of the pending litigation, there is a lot of information the city can't release. Johnson assured the audience that any information they are allowed to share, they will. After the trial begins, more information will be available.

Newmont in Hot Water Worldwide

The past few years have seen Newmont engaged in numerous environmental battles with communities across the globe that have been harmed by both past and ongoing mining.

This week, Indonesian prosecutors have vowed to file a Supreme Court appeal of a verdict that acquitted Newmont of criminal charges that it sickened villagers and sea life with arsenic and mercury the company dumped into Buyat Bay on Sulawesi Island.

At the World Bank-backed Yanacoche Mine in Peru, the second-largest gold mine in the world, watersheds have been contaminated by cyanide from heap leaching. In 2000, over 300 pounds of mercury were spilled along a 45-mile road. More than a thousand villagers are seeking compensation.

On April 25, and as the result of increasing international criticism of Newmont's lax environmental practices, Newmont shareholders voted to require the corporation to address community opposition in the United States and abroad.

Here in Grass Valley, Newmont is participating in a multi-million-dollar clean up of toxic mine effluent flowing from another underground source, this one located at Empire Mine State Historic Park. For more information go to: Data Collection on Toxic Mine Waste Continues at Empire Mine State Park.
http://www.yubanet.com/artman/publish/article_55724.shtml