The controversial proposed Back Forty open pit metallic sulfide mine on the Michigan-Wisconsin border has suffered major financial and permitting setbacks due to the ongoing COVID-19 pandemic and increasing public concerns over the safety of tailings dams to store mine waste. The proposed mine, would be located next to the Menominee River, which flows into Lake Michigan, and has raised concerns about potential pollution.
The COVID-19 pandemic has so far wiped $282 billion from the value of the top 50 mining companies worldwide, according to figures published by Mining.com. These huge losses suffered by the world’s largest mining companies has made it extremely difficult for junior mining companies, like Aquila Resources, the owner of the Back Forty Project, to raise sufficient funds to take the project through exploration, development and final permitting of a mine and tailings dam next to the Menominee River.
To attract desperately needed financing from worried investors, Aquila has provided inaccurate information about the status of the Back Forty Project in its most recent financial report. The company’s March 2020 report states “Aquila has received all State and Federal permissions required for the construction and commencement of operations at the Back Forty Project.”
In fact, the company has not yet submitted a revised Dam Safety Permit application since Michigan’s Department of Environment, Great Lakes, and Energy (EGLE) rejected Aquila’s original Dam Safety application as incomplete and requested additional information. Local citizens and the Menominee Indian Tribe of Wisconsin strongly opposed the permit at a public hearing because a tailings dam failure could cause massive pollution of downstream communities and Lake Michigan. According to EGLE, “Aquila is not authorized to begin construction of the mine and will not be able to proceed until all permits, including the Dam Safety Permit have been approved by EGLE.”
Any review of Aquila’s proposed tailings dam must confront the issue of whether current industry standards adequately protect communities and ecosystems from the kind of catastrophic failures seen in Brumadinho, Brazil in 2019 and at Mount Polley in British Columbia, Canada in 2014. An international group of 142 scientists, community groups and environmental organizations from 24 countries has just published a set of 16 guidelines for the safer storage of mine waste in tailings dams. Among the top recommendations is that tailings facilities must be built and managed only with community consent, respecting the human rights and the rights of Indigenous Peoples, and adopting the best available technologies and practices.
The issue of dam safety has become a greater concern in Michigan in light of the unprecedented flooding after two dams collapsed in Midland, in central Michigan, following record rainfall last May. The Edenville and Sanford Dams were breached after Midland received 4.7 inches of rain in a 48-hour period, following days of heavy rain across the state. Much of Midland, a city of more than 40,000, was submerged in floodwaters that flowed into a large Dow Chemical complex and threatened a vast Superfund toxic cleanup site downriver.
Thousands of residents of Edenville, Midland and Sanford were forced to flee their homes and businesses along the Tittabawassee River. Gov. Gretchen Whitmer issued an emergency declaration, noting that the flood severity was on the order of a 500-year flood event.
The Edenville and Sanford Dams that failed were water-retention dams made of concrete and steel. In contrast, the upstream dam design proposed for the Back Forty tailings dam would be made of crushed waste rock and overburden soil. The Coalition to SAVE the Menominee River posed the following question in a June 1, 2020 letter to Luke Trumble, EGLE’s dam safety expert: “If the more stable water-retention dams were unable to withstand a 500-year flood event, how could Aquila’s far less stable Back Forty tailings dam possibly withstand a similar challenge?”
Dale Burie, President of the Coalition, noted that EGLE’s previously stated response to citizen concerns about extreme rainfall events was that “contingencies are included in the mine plan to address outlier events.” According to Burie, “This technological optimism is scientifically unwarranted and ignores the record of 46 catastrophic tailings dam failures in the past 20 years.”
The Coalition concludes their letter with the following request: “In light of the recent dam failures and the well-documented threat of failure for the Back Forty tailings dam in an area of heavy rainfall, we are asking EGLE to exercise your authority to prohibit the upstream dam construction design for the proposed Back Forty tailings dam. If EGLE fails to prohibit a dam design that has already been banned in Brazil, Chile, Peru and Ecuador as an inherently risky technology, the communities downstream from the Back Forty’s tailings dam can only interpret this decision as placing Aquila’s corporate profits over public health, safety and clean drinking water.”
EGLE has not responded to the Coalition’s letter. Meanwhile, Aquila’s June 2020 investor presentation predicts the approval of a Dam Safety Permit in 2021. Neither Aquila nor EGLE have obtained the consent of either the Menominee Tribe or local citizens for the proposed Back Forty tailings dam. The lack of community consent for the tailings dam reinforces the perception among its opponents that this project lacks a social license to operate. A social license is essentially a set of demands and expectations, held by local stakeholders – like citizens, environmental groups and Native nations – for how a business should operate.
A social license to operate is intangible and unwritten and cannot be granted by EGLE or any other state agency or legal authority. However, the international mining industry understands that community support for a mining project is as important, if not more so, than a regulatory license. Losing social support is in fact seen as the number one risk facing mining companies according to a recent survey by Ernst & Young consultants. Without a social license to operate, Aquila will find it increasingly difficult to raise funds to continue the permitting process from risk-adverse investors.