[Senate Hearing 119-46]
[From the U.S. Government Publishing Office]
S. Hrg. 119-46
PENDING LEGISLATION
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON
ENERGY AND NATURAL RESOURCES
UNITED STATES SENATE
ONE HUNDRED NINETEENTH CONGRESS
FIRST SESSION
on
S. 362
S. 544
S. 596
S. 714
S. 789
S. 859
__________
MARCH 12, 2025
__________
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Printed for the use of the
Committee on Energy and Natural Resources
Available via the World Wide Web: http://www.govinfo.gov
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U.S. GOVERNMENT PUBLISHING OFFICE
60-022 WASHINGTON : 2025
COMMITTEE ON ENERGY AND NATURAL RESOURCES
MIKE LEE, Utah, Chairman
JOHN BARRASSO, Wyoming MARTIN HEINRICH, New Mexico
JAMES E. RISCH, Idaho RON WYDEN, Oregon
STEVE DAINES, Montana MARIA CANTWELL, Washington
TOM COTTON, Arkansas MAZIE K. HIRONO, Hawaii
DAVID McCORMICK, Pennsylvania ANGUS S. KING, Jr., Maine
JAMES C. JUSTICE, West Virginia CATHERINE CORTEZ MASTO, Nevada
BILL CASSIDY, Louisiana JOHN W. HICKENLOOPER, Colorado
CINDY HYDE-SMITH, Mississippi ALEX PADILLA, California
LISA MURKOWSKI, Alaska RUBEN GALLEGO, Arizona
JOHN HOEVEN, North Dakota
Wendy Baig, Majority Staff Director
Patrick J. McCormick III, Majority Chief Counsel
Jeanne Kuehl, Professional Staff Member
Jasmine Hunt, Minority Staff Director
Sam E. Fowler, Minority Chief Counsel
Maya Hermann, Natural Resources Policy Director
C O N T E N T S
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OPENING STATEMENTS
Page
Lee, Hon. Mike, Chairman and a U.S. Senator from Utah............ 1
Heinrich, Hon. Martin, Ranking Member and a U.S. Senator from New
Mexico......................................................... 3
WITNESSES
Haddock, Rich, Senior Advisor, Barrick Gold Corporation.......... 5
Somers, Brian, President, Utah Mining Association................ 106
Wood, Chris, President and CEO, Trout Unlimited.................. 111
ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED
American Exploration and Mining Association:
Statement for the Record..................................... 141
Backcountry Hunters and Anglers et al.:
Letter for the Record........................................ 172
Baratta, Tom:
Letter for the Record........................................ 174
Bull Mountain Land Alliance and Northern Plains Resource Council:
Letter for the Record........................................ 175
Citizens for Responsible Energy Solutions:
Letter for the Record on S. 714.............................. 153
Letter for the Record on S. 544.............................. 154
Haddock, Rich:
Opening Statement............................................ 5
Written Testimony with attached supplemental material........ 7
Responses to Questions for the Record........................ 157
Heinrich, Hon. Martin:
Opening Statement............................................ 3
Lee, Hon. Mike:
Opening Statement............................................ 1
National Mining Association:
Letter for the Record on S. 714.............................. 138
Letter for the Record on S. 544.............................. 139
Outdoor Alliance:
Statement for the Record..................................... 180
Pfister, Ellen:
Letter for the Record........................................ 186
Somers, Brian:
Opening Statement............................................ 106
Written Testimony............................................ 108
Responses to Questions for the Record........................ 168
Wood, Chris:
Opening Statement............................................ 111
Written Testimony............................................ 113
Responses to Questions for the Record........................ 171
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The text for each of the bills addressed in this hearing can be found
on the Committee's website at: https://www.energy.senate.gov/hearings/
2025/3/full-committee-hearing-to-receive-testimony-on-pending-bills
PENDING LEGISLATION
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WEDNESDAY, MARCH 12, 2025
U.S. Senate,
Committee on Energy and Natural Resources,
Washington, DC.
The Committee met, pursuant to notice, at 10:01 a.m. in
Room SD-366, Dirksen Senate Office Building, Hon. Mike Lee,
Chairman of the Committee, presiding.
OPENING STATEMENT OF HON. MIKE LEE,
U.S. SENATOR FROM UTAH
The Chairman. The Committee will come to order.
Welcome to the Committee's first legislative hearing of the
119th Congress. Today, we will receive testimony on six bills
listed in the notice for today's hearing. All of these bills
address domestic mining and mineral processing, related
reporting, and public information. Four of these measures have
bipartisan co-sponsors, and a fifth has received some
bipartisan support. Having served on this Committee since 2011,
I am keenly aware that the United States has fallen behind
China and other nations when it comes to mining and mineral
processing. Today's hearing represents a first step in
developing a legislative record on measures to address this
very problem.
Of course, not all of us will support each measure on which
the Committee will hear testimony today. I don't support all of
the bills listed on the notice for today's hearing. For
example, although I agree that America needs to process more
non-fuel minerals here at home, and I appreciate that Senator
Hickenlooper's bill, S. 596, has Republican co-sponsors, I have
strong reservations about the pilot program that this
legislation would establish.
Also, I included Senator Lujan's bill, S. 859, in today's
hearing as a courtesy. Senators Henrich, Wyden, and Padilla are
co-sponsors, along with a number of Democratic colleagues.
Today's hearing is reflective of my intent to sharpen the
Committee's focus on legislation without diminishing our other
responsibilities to consider presidential nominations or to
conduct oversight within our Committee's jurisdiction. We will
begin by moving pending nominations through the Committee as
soon as we have the requisite paperwork on these additional
nominations.
I want to thank Ranking Member Heinrich and all the members
of the Committee for helping identify the six bills that we
will receive testimony on this morning. After I conclude my
opening statement, we will hear from Senator Heinrich for his
opening statement, and thereafter, I will introduce our
distinguished panel of witnesses. We will hear the witness
testimony, and then move to a round of questions from members.
Members will have five minutes for their questions and we will
alternate between senators on one side of the dais and then the
other.
If you are here today, it's because you understand that
America's economic strength and national security hinge
ultimately on securing a reliable supply of key materials.
Currently, a majority of the world's mineral extraction and
refinement are controlled by adversarial countries. We have
seen what happens when we rely on these nations for essential
resources--supply chain disruptions, economic vulnerabilities,
and ultimately, tragically, national security risks. It's time
to fix that. The resources are here--right here in the United
States, and we just need the right policies in order for us to
be able to unleash them. My home State of Utah, for example,
has 40 of the 50 minerals deemed essential by the U.S.
Geological Survey. Yet, bureaucratic delays and inconsistent
regulations create often insurmountable barriers to domestic
production.
A 2024 S&P global survey found that U.S.-based mineral
projects take an average--an average--of 29 years to move from
discovery to production. That is the second longest timeline in
the world. To put that in perspective, if a mine were needed
for defense applications during World War I, using today's
permitting timelines, it wouldn't be operational until after
World War II had come to an end. That is unacceptable. It's one
of the reasons why I have introduced the Critical Mineral
Consistency Act with my colleague from Arizona, Senator Mark
Kelly. Right now, the Department of Energy and the Department
of the Interior have separate, parallel, inconsistent lists of
what counts as critical and what does not. That does not make
any sense.
In 2023, the Energy Department added copper to its list of
critical materials, recognizing the metal as integral in energy
technologies, but also at risk for supply disruptions by 2035.
But the U.S. Geological Survey left copper off its own list,
even though it is vital for power grids, wind turbines, and
electric vehicles. My bill would require these lists to match.
These designations send a powerful message to investors. The
U.S. Government is backing these supply chains on national
security grounds. If we want private investment in domestic
production, we need clarity and we need consistency. That is
exactly why we need to pass Senators Cortez Masto and Risch's
Mining Regulatory Clarity Act to enable mining on federal land.
But streamlining regulations is only part of the equation.
This doesn't get to the whole thing we need to get to,
streamlining regulations. We need to go beyond that, and to
truly strengthen our supply chains we must also reject policies
that create additional burdens on domestic production. Imposing
additional federal royalties would only add cost and
uncertainty, potentially shutting down existing projects, and
driving investment overseas--overseas specifically to nations
with far worse, far inferior environmental and humanitarian
standards than what we have here. It would create redundant
fees, as domestic mining projects are already subject to state
and local royalties and taxes. Simply put, these proposals
would make our mineral supply chains less competitive and it
would make them more vulnerable, impacting everything from
economic growth to national security. We cannot afford to drag
our feet any longer. China is racing ahead in mineral
processing and refining. We need to move faster, smarter, and
more strategically. The United States has the resources, the
talent, and the technology. We just need the right policies to
lead this charge. That starts here with hearings like this one
that we are having today, and with legislation like what we
will be discussing at this hearing.
I look forward to working with my colleagues to ensure that
we have the ability to unlock our full potential and secure
America's mineral future. Thank you.
I now recognize Senator Heinrich for his opening statement.
OPENING STATEMENT OF HON. MARTIN HEINRICH,
U.S. SENATOR FROM NEW MEXICO
Senator Heinrich. Thank you, Chairman.
I am glad that we are holding this hearing today on a set
of issues that are critically important to people and
communities across the country, but particularly in the West.
However, before turning to the topic of today's hearing, I
think it's impossible to talk about any natural resource issue
today without talking about the incredible damage being done to
the workforce that manages those lands and resources for the
American people.
The illegal firings of probationary staff, rumored to be
just the beginning of staffing reductions, is already reducing
access to public lands, with locked gates and closed visitor
centers at parks across the country. What's more, as we are
considering legislation intended to increase mineral production
on public lands, this Administration is cutting staff at land
agencies that process those same permits. With a voluntary
resignation offer that encouraged some of the most experienced,
highest-performing staff at these agencies to leave public
service, along with illegal firings of staff who were recently
promoted because of their high performance, this Administration
is crippling the very public land agencies that evaluate plans
for new mines. Anyone who is hoping for ``government
efficiency'' out of this Administration can see that what we
are actually getting is government dysfunction.
Now, to today's hearing, in particular. Modern technologies
involve a lot of raw materials, and as our scientists and
engineers find new and cheaper ways to generate and store
energy, the types and quantities of minerals used in energy
technologies will only continue to grow. Responsible domestic
mining and processing can be part of the solution, but we can't
get there with outdated laws that don't reflect the nation's
needs and priorities today. The law that governs metal mining
on most public lands in the West was written in 1872--more than
150 years ago. Yellowstone had been a national park for barely
two months when the mining law was signed, and New Mexico would
still be a territory for another 40 years. We have actually
learned quite a bit since 1872--how to manage public land for
public benefit, how to conserve habitat for sustainable fish
and wildlife populations, how to protect our drinking and
irrigation water from heavy metals pollution, and how to ensure
a fair return for the commercial development of resources that,
after all, belong to the American people. And yet, our hardrock
mining law remains stuck in the 19th century, right when we
need to build the energy infrastructure of the 21st century.
Updating the 1872 Mining Law could bring public land mining
into the 21st century and provide the minerals that we need for
the energy technologies of today.
But we are here today to talk about more than just mining,
because mining alone won't solve our supply chain dependence on
adversaries unless we also invest in the entire life cycle of
minerals. This includes increasing our domestic mineral
processing capacity, continuing the onshoring of manufacturing
through the CHIPS and Science Act, and investing in recycling
technologies so that we can reuse the minerals that we already
have. The fact that we export copper and rare earth materials,
as well as things like batteries, to China in the form of
electronic waste is one of the more infuriating realities of
our current system. We should be capturing and reusing the
minerals present within our borders in devices, vehicles,
batteries, and machinery, rather than paying to ship them
overseas.
I firmly believe we can find ways to secure the minerals we
need for new energy technologies while also protecting our
water, air, and public lands. I believe it's possible to open
new mines while giving local communities a say in whether a
particular location on public land is an appropriate place for
a new mine, just like we do for oil and gas and other uses. And
I am confident that we can find a way to finally fund the
cleanup of legacy mine pollution that contaminates streams and
rivers across the West. I hope that today's hearing will be a
step toward all of those goals.
The Chairman. Thank you, Senator Heinrich.
Now, I will be pleased to introduce each of our witnesses.
It is my pleasure, first, to introduce and welcome Brian
Somers, the President of the Utah Mining Association. Mr.
Somers joined the Association as its President back in 2019. He
previously led the Utah Science, Technology, and Research
Initiative as its Managing Director. Earlier in his career, Mr.
Somers served in leadership and senior staff positions in the
Utah state government and also in private industry.
Our next witness is Mr. Rich Haddock. Mr. Haddock is an
attorney who has worked in the mining industry for more than 30
years. He spent the last 25 years of that time at Barrick Gold
Corporation in both legal and operational roles and retired as
general counsel in 2022. Mr. Haddock is currently a senior
advisor to Barrick. He is also a member of the Board of the
Directors of Perpetua Resources Corporation. I am pleased to
relate that Mr. Haddock holds a degree in geology from Brigham
Young University and a law degree from the University of Utah
School of Law.
Finally, we will hear from Mr. Chris Wood, the President
and CEO of Trout Unlimited since 2001. Before joining Trout
Unlimited, Mr. Wood served as the Senior Policy and
Communications Advisor to the Chief of the U.S. Forest Service,
capping a career in government. He is the author and co-author
of numerous papers and articles and three books.
Okay, so we will now hear from each of the witnesses. Mr.
Haddock, we will start with you, then move to Mr. Somers, and
then Mr. Wood.
STATEMENT OF RICH HADDOCK, SENIOR ADVISOR,
BARRICK GOLD CORPORATION
Mr. Haddock. Chairman Lee, Ranking Member Heinrich, Senator
Cortez Masto, and members of the Committee, thank you for
inviting me to testify today. I believe it is critical to
competitiveness and national security for the United States to
develop a secure mineral supply chain. One only needs to look
at China's export ban of certain strategic minerals to
understand this. I believe we can do much of what is necessary
here at home with a domestic mining industry.
Over the last 40 years, production of many critical
minerals has become concentrated in just a few mines in
unfriendly jurisdictions where global demands are met by a race
to the bottom--a price of human rights standards, of labor
standards, and of environmental standards. Often, critical
minerals are produced only as byproducts or are found in very
small quantities along with gold, copper, lead, zinc, iron, and
other economically viable minerals. The key to domestic
production of as many of these minerals as possible is a
healthy ecosystem for the U.S. mining industry, policy,
expertise, and investment. The first step in creating a healthy
mining ecosystem is before you today as S. 544, the Mining
Regulatory Clarity Act. This is a bipartisan bill. I testified
in support of it at the request of chairs from both parties.
This bill addresses the confusion, delay, and continuing
litigation created by the Ninth Circuit Rosemont decision,
which upended decades of mining law interpretation and agency
practice. Rosemont, if not addressed, would make it nearly
impossible to site mine support facilities like mills, shafts,
crushers, tailings facilities, and roads. In BLM regulatory
parlance, these are called ancillary facilities, but I think
``necessary'' is really a better adjective because you can't
have a mine without one, and I am grateful the Committee
recognizes that.
The version of the MRCA before you today responds to
criticisms of the original bill, S. 1281, introduced by Senator
Cortez Masto in the 118th Congress. Initially, industry and
environmental groups worked together to develop a detailed
savings clause to defuse the criticism. When it persisted under
Senator Cortez Masto's leadership, Committee staff worked with
industry representatives and environmental group
representatives to produce this version of the bill. It is the
same language this Committee advanced last fall as part of the
Energy Permitting Reform Act of 2024.
The MRCA is narrowly tailored. Over the last 50 years, less
than one-third of one percent of the land in Nevada has been
included in a plan of operations. This, the state with the most
mining and 85 percent federal land. Only a portion of the
ground inside a plan of operations is disturbed and only a part
of that disturbed ground contains ancillary facilities. These
subsection (c) mill sites created by the bill can only be
located inside a proposed plan of operation, which only happens
when you have a real mine. Real mines are few and far between,
and honestly, I wish we had a few more, and perhaps our
critical mineral concerns might not be as acute as they are
today.
So with that, I applaud that the Congress recognizes the
strategic importance of minerals as represented by the three
critical mineral bills before the Committee. I thank the
sponsors for their work on these bills. The Chairman's Critical
Mineral Consistency Act is common sense--one list, that is
dynamic, to guide policy.
I applaud the goals of the Critical Minerals Future Act, S.
596, because it recognizes there are market forces that inhibit
the domestic production of these minerals and proposes ways to
begin to address those forces. I thank Senator Hickenlooper and
his staff for their extensive outreach to industry and effort
on the bill. I also appreciate that S. 789 recognizes that the
U.S. needs to be as resource-savvy as our global competitors.
Importantly, I think these bills underscore the need to focus
on and improve our knowledge of potential domestic resources
for these minerals, which I believe should be our long-term
primary goal.
And finally, while not today's topics, I would be remiss if
I didn't, number one, thank the Committee on Environment and
Public Works for recognizing that permitting and associated
judicial review needs to be improved, and for your ongoing work
on these issues. And number two, acknowledge, thank, and
congratulate Senator Heinrich for his tireless effort on the
Good Samaritan bill last year, which was a great step in the
right direction, and we were delighted to see signed into law.
Thank you, and I look forward to any questions.
[The prepared statement of Mr. Haddock follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you, Mr. Haddock.
We will hear from Mr. Somers next.
STATEMENT OF BRIAN SOMERS, PRESIDENT,
UTAH MINING ASSOCIATION
Mr. Somers. Chairman Lee, Ranking Member Heinrich, and
other members of the Committee, thank you for the invitation to
testify.
Mining is a critical industry in Utah, contributing $7.7
billion to the state's GDP, supporting nearly 57,000 direct and
indirect jobs, and powering Utah's broader economy by producing
the coal which provides 62 percent of Utah's low-priced
electricity. Mining jobs in Utah are family- and community-
sustaining jobs, with mining salaries averaging 46 percent more
than the average Utah wage. The recent actions of China to ban
or restrict the export of critical minerals or mineral
processing technologies, which they control, should highlight
the need to strengthen our domestic mining and mineral
processing capabilities and reshore critical mineral supply
chains. Of the ten minerals or mineral groups currently subject
to Chinese export bans or restrictions--rare earth elements,
antimony, germanium, gallium, graphite, tungsten, tellurium,
bismuth, molybdenum, and indium--Utah has the capacity to
produce nine. Utah is currently producing the rare earth
elements tellurium and molybdenum. Utah has proven and very
rare primary resources of germanium, gallium, and indium and
significant historical production of antimony, tungsten, and
bismuth.
As the Chairman mentioned, Utah hosts 40 of the 50 critical
minerals on the Department of the Interior's current critical
minerals list--40 of the 50 critical minerals in just one
state, admittedly one with an unusually rich and diverse
mineral endowment. Add occurrences of critical minerals in
other states, and there is little reason the U.S. should be as
dependent as it is on foreign critical mineral supply chains,
again, with our geopolitical adversary, China, as the dominant
global producer. Our current situation is the result of a lack
of investment in and support of our domestic mining and mineral
processing industries as well as outright market manipulation
by China and other foreign mineral producers. The U.S. mining
industry is committed to responsibly developing our mineral
resources, and it is appropriate that the U.S. has stringent
labor, safety, financial, and environmental regulations.
However, these regulations must also be rational, stable,
economically feasible, and not misaligned with the regulatory
environments of other free and developed nations with major
mining industries--nations like Canada and Australia.
The Chairman also mentioned the report from S&P Global that
found that the U.S. has the second longest timeline in the
world for developing a new mine--29 years--the worst record of
any country in the world, except for Zambia. That report
states, ``The development of a mine in the U.S. is not only
long and costly, it is unusually uncertain. While developing a
mine in Canada or Australia can also take a long time . . .
those mines do reliably enter production. In the U.S., even if
mines receive all required permits, they are subject to higher
litigation risk. Uncertainty and litigation risk may explain
why exploration budgets committed by investors to Canada and
Australia over the last 15 years have been 81 percent and 57
percent higher than to the U.S.''
If the U.S. is to have any chance of becoming self-
sufficient in supplying its own critical mineral needs,
Congress and the Federal Government must commit to real
permitting reform, litigation reform, ending federal land and
mineral withdrawals, renewing the diminishment of state primacy
for the enforcement of federal labor and environmental laws,
reversing the decline of mining engineering programs at U.S.
universities, providing grants for research and to do mineral
extraction and processing technologies, and providing incentive
to attract more mineral exploration and other mining investment
to the U.S. A positive first step is the recent introduction of
the Critical Mineral Consistency Act of 2025 by Chairman Lee
and Senator Kelly. This act will end the misalignment between
the Department of the Interior's critical minerals list and the
Department of Energy's critical materials list.
If the act is passed, it will have a positive effect on
Utah, as we are a major copper producing state. In fact, Utah
is home to one of the largest and most productive copper mines
in the world, the Rio Tinto Kennecott Bingham Canyon Mine. Rio
Tinto Kennecott is not only a world-class copper operation that
has one of only two working copper smelters in the U.S., it is
also Utah's largest producer of critical minerals, currently
producing tellurium, platinum, and palladium, and with the
potential to produce rare earth elements, indium, germanium,
gallium, and many other critical minerals through secondary
recovery. The example of Rio Tinto Kennecott highlights the
fact that many critical minerals are co-mingled with base
metals, precious metals, and other mineral commodities, and why
we must not only support and invest in new mines, but also
expand production in secondary recovery at existing mines and
mineral processing facilities.
I know the Utah success story on this front is the Energy
Fuels White Mesa Mill in Blanding, Utah. The White Mesa Mill is
the last functioning conventional uranium mill in the U.S., and
which is now also processing monazite, a mineral byproduct
which contains uranium, but also high concentrations of rare
earth elements. Using an existing and already-permitted
facility--and a high dose of rural Utah ingenuity--the White
Mesa Mill has created the most advanced rare earth element
processing operation outside of China, a great step toward
ending that nation's stranglehold on the rare earth supply
chain.
Again, I appreciate the opportunity to highlight some of
Utah's success stories and to discuss how the Federal
Government can better support state efforts to lead on the
critical minerals front. I look forward to any questions from
the Committee.
Thank you.
[The prepared statement of Mr. Somers follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thanks, Mr. Somers.
Mr. Wood, you are next.
STATEMENT OF CHRIS WOOD,
PRESIDENT AND CEO, TROUT UNLIMITED
Mr. Wood. Chairman Lee, Ranking Member Heinrich, and other
Committee members, thank you very much for inviting me to
testify today.
Trout Unlimited has been involved in mining issues for a
long time, from protecting special places, such as Bristol Bay
in Alaska, to working with the mining industry and other
partners to clean up legacy pollution from abandoned mines.
Domestic mineral production helped to build our nation. It won
two world wars. It fueled westward expansion and provides the
raw materials for modern society. At the same time, historic
mining left hundreds of thousands of abandoned mines that dot
the landscape, leeching their toxic brew of lead, zinc,
cadmium, arsenic, and other pollutants into our rivers and
streams. To be certain, there is no constituency for acid mine
waste and orange rivers. There is, however, a bipartisan
commitment to clean up abandoned mines, to encourage
responsible mining, and to propel the needs of a clean energy
future while making our rivers and streams cleaner and our
communities healthier. Working together, we have an opportunity
to craft a path forward that is collaborative, innovative, and
responsible.
In 1872, the General Mining Law helped to spur settlement
of the West. Today, it is an anachronism in need of
modernization. The EPA estimates that 40 percent of western
headwater streams are negatively affected by abandoned hardrock
mines. These are, by and large, not contemporary mines. They
were built many decades or even a century ago. An analysis
conducted by Trout Unlimited scientists found that
approximately 110,000 miles of streams, enough to encircle the
earth four times, are listed as impaired, and abandoned mines
are a major source of these impairments. Thanks last year to
the leadership of Senator Heinrich, Senator Risch, and many
other members of this Committee, Congress passed the Good
Samaritan Remediation of Abandoned Hardrock Mines Act of 2024.
The new law is proof that the mining industry and conservation
interests can find common ground and pass common-sense mining
legislation.
Tens of thousands of abandoned mines negatively affect our
nation's waters. The reality is that this is a completely
solvable problem. Just about every commodity produced from our
public lands has an associated royalty or fee that helps to
address remediation from legacy development. I appreciate that
mining companies must make years and often millions of dollars
in investments before they can mine, but there should be a
common-sense royalty once new mines are up and running to help
pay for the cleanup of legacy mines. The coal industry alone
has paid more than $12 billion in royalties since 1977 to help
clean up abandoned coal mines across Appalachia and parts of
the West. If we can do it with coal, we can do it with hardrock
minerals, especially given the immense need.
Finally, professional land managers should be able to deny
a mine if it is proposed in a community drinking water supply,
a sacred site, or an exceptional fish and wildlife habitat. But
that denial should happen early in the process, before a mining
company has invested tens of millions of dollars in exploration
or development. Between the industry's desire for certainty,
the confusion caused by the Rosemont decision, the obvious need
for a royalty, and the equally obvious need for some measure of
discretion as to where mining can and should occur, there is an
agreement to be had. We have fought and bickered and disagreed
over mining on public lands for over 100 years. Certainly,
there is a common-sense compromise within our reach that would
provide sufficient, dedicated funding for abandoned mine
cleanups, allow that certain landscapes are inappropriate for
mining, and at the same time, address the legal and regulatory
certainty needed for investment by the mining industry. You
have Trout Unlimited's commitment to continue working in good
faith to strike that balance.
Thank you for the opportunity to be here today.
[The prepared statement of Mr. Wood follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thanks so much for your opening testimony. We
will now proceed to questions. We will be alternating between
Republicans and Democrats in five-minute rounds.
Mr. Somers, I would like to start with you.
Last month, I introduced a bill called the Critical Mineral
Consistency Act, and I did this in order to try to align the
Department of the Interior's critical minerals list with the
Department of Energy's critical materials list. Can you explain
for us, Mr. Somers, why both critical minerals and critical
materials are essential to the United States, particularly with
regard to our economic, energy, and national security?
Mr. Somers. Absolutely. Thank you, Mr. Chair. I applaud you
for introducing this particular piece of legislation because
the disparities between the lists that the Federal Government
has maintained, especially between the DOI list and the DOE
list, have been perplexing to the mining industry for a number
of years now, and in many cases, again, when you are talking
about critical minerals specifically, a lot of these critical
minerals, as I mentioned in my testimony, are co-located with
base metals and precious metals and other things that may not
appear on either of these lists. But in particular, in the case
of Utah, again, our most productive copper mine is also our
most productive critical mineral mine. And so, making sure that
you have equal consideration from the Federal Government for
both the critical minerals and minerals like copper is really
essential.
The other issue that comes to the fore here is that, you
know, regardless of what national defense technology or energy
transmission technology you are talking about, I mean, they are
going to rely both on things like copper, and on some of the
more boutique minerals, you know, that are on the critical
minerals list. And so, you know, while you have a large number
of rare earths, for example, that will go into an F-35, which
we have a lot of in Utah, you also need a lot of copper to make
an F-35. You also need vanadium for the alloys that go into
those airframes. And so, again, having some consistency from
the federal perspective when it comes to any potential fast-
track permitting or grants and research and other things is
essential in order for us----
The Chairman. Why does it matter for us to try to produce
those in the United States rather than importing them?
Mr. Somers. Right, absolutely. I mean, again, as you have
seen from the recent actions of China, I mean, if you have
something like antimony, for example, that is banned, that
prevents us from manufacturing munitions in the United States
because those are critical to go into, again, munitions, the
national defense systems, and other things. And so, it does
become a national security risk if we are relying on foreign
producers and especially adversarial foreign producers for
those minerals.
The Chairman. Makes sense.
Mr. Haddock, in your testimony, you noted that Nevada,
where Barrick operates, is a state with a lot of federal land,
and Utah faces, of course, a similar challenge with 67 percent
of our land being owned by the Federal Government. When it
comes to mineral development, what additional hurdles do
companies face when trying to develop these things when they
are operating on federal land as compared to either state land
or private land?
Mr. Haddock. The additional hurdle is permitting--that is,
the timeline for permitting. The permitting timelines on state
or private land would be much quicker, and then, of course, the
litigation risk on the tail-end, where almost every project is
litigated. It makes it very difficult to spend a lot of money,
like for some projects you would spend half a billion dollars
before you get to the point of permitting it. That's a lot of
money to sit there for a long time.
The Chairman. But when you are going in to operate on
either state land or private land, there is still permitting
required. There is still a potential litigation risk. Tell me
how that risk and the corresponding delays compare between the
two.
Mr. Haddock. There is kind of a broader range of litigation
risk because of, number one, NEPA. The federal agencies that
administer the public lands do an absolutely great job of
bringing together mountains of data, analyzing all the range of
issues that that they have to consider under the various laws.
But what tends to happen in those cases is that the courts tend
to flyspeck the EISs and nitpick until they find one issue that
they don't think has been adequately addressed and then you are
back to supplemental EIS.
The Chairman. Okay, so does that suggest that the
additional time consumed in the federal process doesn't
necessarily produce a cleaner, safer outcome-- it's more
flyspecking and time consuming, but not necessarily with a
corresponding benefit to environmental quality? And if this is
the case, how does this impact--how does that situation,
compounded by recent court decisions, how does that impact
investment in project development?
Mr. Haddock. Well, it makes it harder to invest, but you
are absolutely right. NEPA was enacted before many of the
detailed federal environmental laws that have performance
standards. And what commonly happens is, whether you are
working on state land or private land or federal land, you have
to comply with all those laws. What typically happens to an EIS
process is, additional mitigation measures are imposed,
additional performance standards are imposed, and then they are
litigated over. So that's kind of the additional burden from
that.
The Chairman. Thank you. My time is expired.
Senator Heinrich.
Senator Heinrich. Thank you, Chairman.
Mr. Wood, according to the GAO, there are at least 140,000
abandoned hardrock mine features just on federal land--and GAO
actually points out itself that that information, where those
sites are, is so lacking that the true number may actually be
closer to half a million features on public land alone. That
leads into the dynamic that you described of something like 40
percent of headwater streams being impaired--places that should
run clear and be home to trout--running orange and acidic,
which certainly impacts both irrigation and municipal water
supplies. Walk us through what the primary impediments are to
being able to clean up those sites and how much of it is purely
a resource constraint.
Mr. Wood. Well, thanks to your good work, sir, on the Good
Samaritan Remediation of Abandoned Hardrock Mines Act, one of
the primary problems--liability issues--is at least being
addressed in a pilot program over the next seven years. But the
single largest and most fundamental challenge that we face on
cleaning up abandoned mines is that there is no dedicated
funding source for it. So TU has managed to do about 50
abandoned mine cleanups around the country. And the way we are
able to do that, in spite of the liability, is we get federal
agencies to agree to hold the liability for us, and it's only
on public land that we can do that.
But we have to cobble--we have to beg, borrow, and steal to
get that money. It's membership dollars. The mining industry,
frankly, has been generous in supporting a lot of abandoned
mine cleanups--foundations, private citizens. Unlike with coal,
unlike with oil, unlike with gas, there is no dedicated funding
source that we can rely on.
Senator Heinrich. Mr. Haddock, is it reasonable to expect
mining companies to make some contribution toward that effort?
Mr. Haddock. Senator, let me answer that one this way: we
have said over the years that we would support a reasonable net
royalty. Now, there are, as you have heard me say before, there
are issues about that, including that we should look at total
government take. And when you look at total government take, in
the form of taxes and royalties to state and local governments,
that the amount that you pay to operate in Nevada is really
commensurate with what we would pay to operate in Australia or
Canada. That said, we support a reasonable net royalty. Net
royalty is preferable because in the hardrock mineral context,
the ore bodies are extremely complex and different, and net
represents--net actually recognizes the difference between ore
bodies. You don't have to go about determining what kind of
royalty rate for which ore body.
The other thing I would note is the way--we have to
remember the state and local taxes, because the way the mining
law was set up to begin with was, it really left taxation and
royalties to state governments. It is interesting because when
they pulled oil and gas out of the mining law in 1920, they
made the royalty a federal royalty, but then the Federal
Government collects it and then distributes it back to the
states. And so, with that, I would say that we support it. We
would support actually a reasonable net royalty that is
earmarked first for abandoned mine land reclamation.
Senator Heinrich. Good. That's very helpful. So it sounds
like the main issues here are creating some sort of regulatory
certainty and permitting certainty so that the capital does not
have to be ridiculously patient. There is the issue of actually
being able to have some sort of revenue source that is
reasonable to be able to clean up the existing mine lands
problem, and then the issue that Mr. Wood brought up, of some
level of discretion within the public land management agencies
so that you don't get into the sort of intractable arguments
that oftentimes lead to litigation.
Do you foresee, Mr. Haddock, a potential sort of global
solution here where you could have a lot more certainty at the
front end, and then come up with a reasonable number that does
take into account those variations and then be able to have a
more predictable way to clean up all of the legacy issues?
Mr. Haddock. I think all of those things can happen without
wholesale revision of the mining law. Those are discrete issues
that I think can be addressed discretely. My view on certainty
up front is, that's what the BLM's land resource planning
process is about, and I think that's where the certainty needs
to come. That's where the resources that need to be protected
need to be identified because once you start exploring, you
need to be able to continue.
Senator Heinrich. So you basically need a map of like where
this is going to be embraced and it's permissive, and where the
places where maybe there is enough of a conflict that it's not
appropriate.
Mr. Haddock. And that process exists and is in place today
in the BLM districts.
Senator Heinrich. Thank you.
The Chairman. Senator Daines.
Senator Daines. Chairman, thank you.
I want to talk about the Bull Mountains coal mine. This is
a mine near Roundup, Montana. It plays a crucial role in
Montana's energy economy. The mine employs 250 people. Now,
these are high-paying jobs with good benefits. It generates
over $90 million a year in state, local, and federal taxes and
revenues. It is the lifeblood of Musselshell County.
Unfortunately, these jobs are now at risk and the life of the
mine and the community it serves are in limbo. It's because of
the checkerboard federal ownership in Montana, as well as this
longwall mining process, that this mine is running out of
permitted coal and might be forced to close. And this is why I
introduced Senate bill 362. It's a targeted, short-term fix
that allows the mining of very specific federal minerals to
ensure that we have enough time to find a longer-term solution
for the mine. This bill simply allows the mine to continue
mining the same materials it has for decades under the same
permit it has had for years.
Last Congress, this Committee passed this identical bill
with a bipartisan vote. I want to thank my colleagues on this
Committee for working with me to make that happen, and I hope
we can again pass this short-term fix so these workers in
Montana can continue to provide for their families. Mining jobs
saw a major hit in Montana over the last couple of years. The
Bull Mountains Mine recently had to lay off dozens of
hardworking Montanans because they have run out of permitted
coal. And recently, the Stillwater Mine, the United States only
platinum and palladium mine, which is used in catalytic
converters to keep our air clean, it recently laid off 700
Montanans. We can't afford the loss of any more jobs for these
Montana miners. That's why we must pass this bill and get it on
the President's desk.
Mr. Somers, as the President of the Utah Mining
Association, you understand how vital the mining industry is to
building jobs, local communities, national security, and tax
revenues. In Montana, coal-fired plants provide the largest
share of Montana's electricity generation, accounting for 45
percent of Montana's in-state generation. The coal industry not
only supplies Americans with a low-cost, reliable, and secure
source of energy--it's called baseload power--but it also
generates millions of dollars of federal, state, and local
revenue per year, and creates hundreds of very good-paying jobs
in Montana.
Mr. Somers, can you speak to the importance of supporting
our coal jobs and ensuring that coal mines, like the Bull
Mountains Mine in Montana, continue to provide revenue for our
states as well as our counties?
Mr. Somers. Absolutely, thank you, Senator.
Utah is very similar to Montana with regard to its coal
industry. We also deal with checkerboard ownership. We deal
with, you know, underground mines, and the planning that has to
go into that. And like Montana, the vast majority of our
electricity is provided by coal-fired generation. I mentioned
in my testimony that, you know, mining jobs, on average in
Utah, pay about 46 percent more than the Utah average wage, but
when you go into our coal-producing counties, the number can go
over 100 percent. So in many of our coal-producing counties,
especially in central Utah, mining companies--coal mining
companies--are by far the largest private employer, and provide
very essential revenue, and not just for the direct mining
jobs, but for all of the service jobs that go into those
particular industries. And Utah in particular, like Montana,
has made a very concerted effort to ensure that our coal mines
stay healthy, and also that our coal-fired generation plants
are preserved and we are able to provide that essential
baseload power so that we can continue to have the type of
economic growth that we have become used to in Utah over the
last number of years.
Senator Daines. You know, it's fascinating when you have
conversations with technology leaders today. You are chatting
with--whether it's Google or AWS or Microsoft and others--
before you start talking about the technology, perhaps AI, the
first conversation right now is the shortage of baseload power.
It is the constraint for innovation here for our country long-
term, and grateful that we have baseload power in these coal-
fired plants.
Chairman Lee, I want to close by saying thanks for holding
this hearing. I can't stress enough the importance of passing
this bill, Senate bill 362. It has been passed before in this
Committee, ensuring that the Roundup and the Musselshell
community isn't left behind because of federal inaction. The
Federal Government has been slow-rolling this. This is a short-
term fix to allow the process to finally become completed for a
long-term solution. This will allow enough time for the Trump
Administration to finalize a new permit, for Congress to pass
legislation like my Crow Revenue Act, to bring long-term
economic certainty for the workers, Musselshell County, as well
as the Crow Reservation and the Crow Nation.
Mr. Chairman, thank you.
The Chairman. Thank you, Senator Daines.
We will turn next to Senator King.
Senator King. Thank you, Mr. Chairman.
This discussion reminds me of a little-known biblical
provision where God came to Moses and said, ``I have good news
and bad news.'' Moses said, ``What's the good news?'' God said,
``I am going to allow you to part the waters of the Red Sea. My
people will escape. The waters will then come back and engulf
Pharaoh's army.'' Moses said, ``God, that's wonderful. What's
the bad news?'' God said, ``You prepare the environmental
impact statement.''
[Laughter.]
Senator King. Sorry, I couldn't resist.
[Laughter.]
Senator King. Mr. Haddock, why does the permitting take so
long? And I used to work on permitting of energy projects. We
thought four or five years was a long time. Why does it take 29
years? What are the bottlenecks?
Mr. Haddock. The permitting itself doesn't take 29 years,
but the average EIS is about four years for a mining project
now. There is a massive amount of baseline data and work that
has to go in--back, you know, in an iterative process with the
agency, and there are just detailed studies, and then at the
tail-end there are massive numbers of comments that then have
to be responded to that require additional work. It is just a
very long process that is, at this point, managed by very
dedicated, very capable federal employees that are stretched
very thin.
Senator King. We hope that those federal employees will
still be here after the next several months, but that's another
subject.
What about--how do we look on cooperation with our
international neighbors? For example, Canada, Australia,
allies--do we need to have more cooperative relationships in
that situation, Mr. Somers? Talk about mining as an
international factor.
Mr. Somers. Sure. And I think that we do have to
distinguish between countries that are allies and countries
that have similar environmental and labor standards like Canada
and Australia, as you mentioned. You know, a good example of
cooperation that we see in Utah is the production of tellurium.
So tellurium is mined at the Bingham Canyon Mine--the Rio Tinto
Kennecott Mine, and then it's actually sent to Montreal for
processing and then sent back to Utah and to Arizona for
manufacturing into----
Senator King. I don't want to calculate the tariff of that
going back.
Mr. Somers. Sure. But I do think that, again, finding ways
to utilize allied supply chains, and also utilizing existing
facilities is very important because in many cases you are
going to be able to get to actual production much quicker if
you are utilizing existing facilities than if you are trying to
build them from greenfield operations.
Senator King. Absolutely. So one word that hasn't been
mentioned much this morning is processing. My understanding,
for example, is that a great deal of lithium comes from
Australia, but something like 85 percent of the processing is
done in China. Should we also be talking about processing when
we are talking about mining? Aren't they interrelated in a way,
because, ultimately, we need that product, the result of the
processing?
Mr. Somers. Absolutely. If you are producing extracted
minerals here in the U.S. but you are having to send them to
China or another unfriendly nation for processing, then you
haven't really solved the problem at all. So processing needs
to be part of this conversation at every level.
Senator King. So that should be part of what we are
discussing here in terms of bottlenecks and that process. And I
think you touched on this, but my notes were, who pays for
abandoned mine cleanup? And it sounds like it's sort of catch-
as-catch-can, Mr. Wood. There is no steady source of available
funds.
Mr. Wood. That's right, and I would be remiss not to
mention again that the mining industry has been very supportive
of helping to clean up abandoned mines so long as they don't
have to hold the liability. But that's the big problem, we
don't have a dedicated funding source to get ahead of these
abandoned mines that dot the landscape.
Senator King. One sort of parenthetical question. Mr.
Somers, you mentioned a mine that was producing a lot of
important minerals, and there were other minerals there that
could be produced at that mine. If you are going after lithium,
and you have discovered tellurium, do you have to go through
another permitting process, or can that mine expand its
production of additional materials without additional delay?
Mr. Somers. To be honest, that depends on that operation,
and it depends on the regulatory environment within the state
where that operation is taking place, but in most cases, it is
easier to go and to produce new minerals from an existing
permitted facility, because in many cases it's a matter of
finding ways, you know, through secondary recovery processes to
pull other minerals out of a waste stream in many cases. And
so, again, it depends on the type of operation, but generally
you are better off, and can get to actual production quicker if
you are using existing permitted facilities.
Senator King. Thank you. I am out of time.
Mr. Haddock, I want to continue our discussion of net
versus gross royalties, and if you would give us some written
material on why mining should be treated different than oil and
gas or coal in terms of the way the royalty is calculated. So
we are out of time here, but I look forward to having some--
maybe a page or two on that subject.
Thank you.
Mr. Haddock. I can point you to materials we submitted to
the Committee before, and I will do that.
Senator King. Thank you.
The Chairman. Senator Cortez Masto.
Senator Cortez Masto. Thank you. Thank you to the
panelists. Rich and Chris, great to see you again. Mr. Somers,
thank you for joining us as well. I am going to do this on
behalf of my mining companies in Nevada, but I know they would
invite any Senator on this panel to come and see hardrock
mining in the State of Nevada. I think it is important to see
it and understand what is going on to recognize the challenges
that they are facing and why they are talking about net
royalties. So I appreciate that.
Thank you also for the hard work that I know you have done
on the Mining Clarity Act, and the work that we have done
together to really focus on some of the challenges that we
heard at the last Committee. Now, this is based on those
challenges. We amended it. It passed out of Committee in a
bipartisan way last Congress, but I want to put to bed some of
the stuff that we are still hearing out there with respect to
this act. So Mr. Haddock, if you would, when we came together
to address some of the concerns that we heard last time, there
were concerns that the Mining Clarity Act would allow mining in
national parks, monuments, and other withdrawn areas. Can you
address that? Can you talk a little bit about whether that's
true or not?
Mr. Haddock. The savings clause in the act makes clear, and
we worked extensively with Trout Unlimited and others on that,
that it does not affect any of the laws that govern mining in
the parks, and it does not change anything that's been
withdrawn. If it has been withdrawn, it's gone. And I think
it's crystal clear in the act.
Senator Cortez Masto. Mr. Wood, you would agree?
Mr. Wood. I would.
Senator Cortez Masto. Thank you.
And then, Mr. Haddock, can you also confirm that the
savings clause and the restructuring of the language, which
includes adding the provision to deposit the mill site annual
maintenance fees into an abandoned mine reclamation cleanup
fund exists? And that was part of this discussion as we try to
address some of the concerns. We recognize there is not a
dedicated funding source, but this was an attempt to try to
start that process. Is that right?
Mr. Haddock. It was, and it was a really convenient way to
do it because this is a new kind of mining claim, and it was
great to just tie it to abandoned mine reclamation.
Senator Cortez Masto. Yes, and if you would address the new
kind of mining claim, because this new language limits where
these new mill site claims can be located. And there is an
accusation that somehow this is also a land giveaway or that
new claims would blanket all of our public lands. Would you
address that?
Mr. Haddock. Yes, new claims wouldn't blanket all of our
public lands. As I have said, it's only a very, very small
percentage of Nevada's lands that is even inside a plan of
operations compared to the 22 percent that has already been
withdrawn and the nine percent that's proposed to be withdrawn.
We are talking about a tiny percentage of one percent of the
state that is in plans of operations. And only part of that is
the ancillary facilities. And so, in order to locate one of
these new subsection (c) mill sites, you have to have a plan of
operations. You have to have a real mine. You just can't go out
and put them anywhere on federal land. You have to have been
working there. You have to have been drilling. You have
prepared a plan of operations. You are going into an EIS. You
have spent tens of millions of dollars at a minimum.
Senator Cortez Masto. For that plan of operation.
And then, Mr. Haddock, finally, this bill does not overturn
or reverse the Rosemont decision. The bill leaves Rosemont in
place. It just creates a new path that miners can choose to
take. Can you discuss under what circumstances a mining company
may choose to take this new path?
Mr. Haddock. Well, from my perspective, it's an easy choice
because it's clear, and I don't have to fight in permitting
over whether or not a given lode claim is valid in the sense
that it has an economically minable mineral deposit on it
before I put my crusher on top of that. I don't have to argue
about whether or not that claim is still valid when I mine
through it in the underground and I still have a crusher
sitting on top of it. It eliminates those issues.
Senator Cortez Masto. Right, but a mining company can
choose if they want to go under the Rosemont decision as a way
to exist, they can move through that path or they can move
through this path setting forth an operational plan with a mill
site and contributing to abandoned mine cleanup. Is that right?
Mr. Haddock. They can.
Senator Cortez Masto. Okay, so there is still a choice
for----
Mr. Haddock. There is still a choice.
Senator Cortez Masto. Okay, I appreciate that.
And then, finally, let me just say thank you to all of you.
You have heard the hurdles. There is no doubt the permitting
process is the hurdle. We absolutely need to, in the West, make
sure that our federal agencies that are crucial to us
continuing this mining in Nevada--it is the BLM and DOI--that
they are adequately funded and staffed. But we also have to
make sure, and I am going to put a fine point on this, that
those people in those positions can't use their positions to
delay permitting by putting it off just because they don't like
the permitting or the mining that is going on. That is not
their choice to do. And so, we have to address both ends of it
when we are looking at moving forward to address the permitting
process of this as well.
So thank you again to the Chairman and Ranking Member for
this hearing.
The Chairman. Let's see--Senator Gallego is next.
Senator Gallego. Thank you, Chairman Lee and Ranking Member
Heinrich, and thank you to our witnesses for your attendance
today.
I have been outspoken about the need to shore up our
critical mineral supply chains for years, especially for our
national security, and just our energy future, and Arizona
certainly can be a leader in this space. Over 70 percent of the
nation's copper comes from Arizona, along with gold, silver,
zinc, and many others. As we produce--these minerals and metals
and advanced technology contribute to our economy and build
infrastructure. We can do this in a way that protects our
natural resources too. So I am glad to see multiple bipartisan
bills on critical minerals in this hearing, and I look forward
to continuing to work on these issues.
So my first question is for Mr. Wood. You mentioned in your
testimony that, historically, mining has threatened drinking
water supply and quality. In states like mine, water is a very
scarce resource that must be conserved and clean. What other
actions can the Federal Government take to protect and
remediate our water in the context of mining and critical
mineral supply chains?
Mr. Wood. Thank you, sir, for your question.
An important step was taken last year with the passage of
the Good Samaritan legislation, which will allow for 12 pilot
projects over the next seven years, and then we have every
intent of coming back and trying to authorize that legislation
to remove the liability hurdles that organizations like mine or
mining companies would face by trying to clean up those
abandoned mines.
The second, again, I mentioned this earlier, but the second
point is paramount today--it's funding. There is just no
funding for it. There is no dedicated funding source. So even
if you didn't have concerns about liability, you still have to
go out and cobble together hundreds of thousands--occasionally
millions--of dollars to do these cleanup projects.
Senator Gallego. My next question is for Mr. Haddock.
Please expand on how the Critical Minerals Consistency Act
would decrease uncertainty about research and tax credits,
especially those passed by Congress in the last few years.
Mr. Haddock. Senator, I'm sorry, that last part about how
the consistency would affect research?
Senator Gallego. Would decrease uncertainty about research
and tax credits, especially those passed by Congress in the
last few years.
Mr. Haddock. Well, I think the Act simply decreases the
uncertainty in mine permitting, and I don't think it really
affects the research and that end of things.
Senator Gallego. Okay.
Mr. Wood, back to my question from earlier. You said that
some of these cleanups can be hundreds of thousands to millions
of dollars. Is there any national estimate of how much cleanup
on an annual basis budget we need to actually be effectively
cleaning up some of these sites?
Mr. Wood. On an annual basis?
Senator Gallego. Yes.
Mr. Wood. It would be nice if we had a billion dollars a
year, but I am just pulling that out of the air.
[Laughter.]
Senator Gallego. It would be nice if a lot of us had a
billion dollars.
Mr. Wood. Yes, you know, a lot of these projects, to be
clear, they are minor construction sites, and my engineers get
mad at me whenever I say this, but in many cases you are
dealing with tailings, you dig a ditch, you line with an
impermeable barrier, you bulldoze the tailings in there, put in
another impermeable barrier, maybe you dig a French drain
around it, and then you walk away. So a lot of these are not--
these are not Superfund sites that we are talking about. These
are often low-tech construction projects. They get more
expensive. The reason I used the millions word was, if you have
to do something like build a wastewater treatment plant, that,
obviously, would be more expensive than just doing a small
construction project.
Senator Gallego. Okay, thank you. I yield back.
Senator Heinrich. So with respect to Senator Gallego's
question, the EPA estimates that the total liability for these
sites is about $54 billion. So if we had a billion dollars a
year, it would still take 54 years to get these sites cleaned
up.
The Chairman. Senator Hickenlooper.
Senator Hickenlooper. Thank you, Mr. Chair, and thanks for
having--both you and the Ranking Member--having this hearing,
and Mr. Haddock, good to see you, and Mr. Somers and Mr. Wood,
nice to see you again.
Obviously, I got a master's in geology back in 1979. Spent
a fair amount of time looking at the difference between geology
and resources and what the difference is between a lode that
could be a mine and a lode that couldn't be a mine. I think if
you go back and look on a broader scale, we are facing
challenges now that are going to require a much higher level of
precision when we make those decisions. And Mr. Haddock,
obviously you have been clear, you and Mr. Somers both, in
terms of we have that capability now to a large extent.
We have introduced three bills on critical minerals that
were part of a number of other bills, and they are mostly
smaller bills, but they are demanding to--we are trying to
drive innovation, strengthen coordination, make sure we have
the appropriate alliances. But I thought that this does seem
like a moment of alignment where we could actually address--
have a more comprehensive bill that looked at that alignment of
self interest in terms of really, I think, many people, and my
first question will be toward you, Mr. Wood, whether you agree
with this, that many people in the environmental community
recognize that we are going to need a lot more critical
minerals if we are going to deal with the challenges of climate
change--more electric vehicles, wind, solar, you know, all of
these things demand, not just, you know, rare earth minerals,
but nickel and copper, I mean, things like this.
And so, Mr. Wood, just to start that, do you think it's
possible that we could--can you imagine some sort of a
consensus from the environmental side of things that we could
help establish what would be the criteria, the framework, by
which mining could take place and processing could take place,
and by so setting standards, we would then export them once we
have worked our way through that? And I am not saying this
happens easily. Is that something you can imagine?
Mr. Wood. I can absolutely imagine that. I don't think we
are that far apart. I mean, coming up with a reasonable--I am
not an expert in royalties, but coming up with a reasonable
royalty, I think, is achievable, it sounds like. Building some
discretion, whether it's the land use plan or upon enactment of
a bill to make clear that some areas are suitable for
development, some are not, that sounds achievable. And I would
be remiss if I didn't say that rare earth minerals, and
minerals, generally, are absolutely vital for the future of
this country. And so, I would rather we mine them here and give
the industry the certainty it needs while providing the
protections that conservation demands.
Senator Hickenlooper. Great, and I agree. I think this is
obviously a unique time, where we have what is too often rare
in government, which is the alignment of self interest, and
that's whether you are working in non-profits, or in
businesses, or in government, the alignment of self interest is
the secret to progress.
Mr. Haddock, we introduced the Critical Materials Future
Act to really expand domestic processing of critical minerals
and directly reduce our reliance on China. It has been already
said several times that China does so much of the processing
for so many of these minerals. Can you elaborate a little bit
on the need for investments both in domestic mining and also
domestic processing?
Mr. Haddock. Well, it's obviously important to have
processing onshore if you can have it. The materials that we
would mine and concentrate for processing are still bulk
materials, and they are expensive to ship.
Senator Hickenlooper. Right.
Mr. Haddock. So if you have, all things being equal, if you
have domestic processing, that promotes a domestic industry.
The other thing I would add is, just to kind of put it in
context, over the last two decades, China has invested $57
billion in critical mineral supply chain, onshore and offshore.
They have recognized the need for that and they have been very
aggressive. And so that's why so much mineral processing is in
China.
Senator Hickenlooper. I agree. Thank you.
Mr. Somers, just really quickly, expanding domestic mining
and processing is going to require a skilled workforce. We have
only 600 students in the United States right now that are
enrolled in mining-related programs. Many of them are at the
Colorado School of Mines, I am proud to say. China has 1.4
million students in mining. How are we going to address this?
Mr. Somers. Yes, thank you, Senator. I think that that's a
huge problem, and not just for the technical degrees--the
mining engineering, chemical engineering, and other degrees--
but also for, you know, skilled trades and other things.
Senator Hickenlooper. Right.
Mr. Somers. You know, I think that the Mining Schools Act
that was considered in the last Congress is a good first step
in that to provide some opportunities for our currently
certified mining schools to go out and recruit more students
and have more resources available to them. But, you know,
solving that workforce problem is critical if we are going to
be able to reshore these supply chains.
Senator Hickenlooper. Right. Thank you, all. And I yield
back only because I have to. I could spend the afternoon
talking to you. I yield back.
The Chairman. Thanks, Senator Hickenlooper.
We will now start the second round.
Mr. Haddock, I would like to start with you. A few minutes
ago, you mentioned you would be okay with a new net royalty,
but that's not, of course, what is being proposed in S. 859.
How do you think a gross royalty, as proposed in S. 859, would
affect the industry and would affect essential mining
investment and development?
Mr. Haddock. Well, it would be devastating, as the
testimonies we submitted on the predecessor to this bill showed
that that kind of royalty would take 67 percent of the value of
the operation. It would take it up from about 30, where we
spend today for total government take, to two-thirds of the
operation, and that just would make the United States
impossible to do business in.
The Chairman. So you add that on top of the other burdens
and it would make it an impossibility.
Now, Mr. Somers, if there were a net royalty, there might
be some businesses, some companies, I suspect, that could
absorb that and deal with it, but what would that do to the
state of competition in the industry, particularly as it
relates to smaller companies, those that are less established?
How would they fare in that environment when they had a net
royalty added on top of the pre-existing burdens that we have
been discussing today?
Mr. Somers. I think it would be very damaging, and
especially, again, when the resources, obviously, don't move,
but the capital can move. And so, companies are going to invest
where they are going to get the best return. And I think
especially in the mining industry, where we rely very much on
small exploration companies and on junior mining companies to
develop many of these mineral deposits, in many cases, they
will be sold off to larger companies. I think that, you know,
having anything that hampers investment, especially in those
smaller companies, and that front-end of the mining, those
front-end mining operations, would be very damaging in the long
term.
The Chairman. So we have to look at this, I suppose, as one
of many market signals. If we were to do that, like I say, even
though some larger companies could absorb it, a lot of the
newer exploration, or at least a significant amount of the new
development, the new exploration, is undertaken by startups, by
smaller companies. We have to respond to all kinds of market
signals--market signals that have to take into account whether
there is federal land involved, whether to what extent there is
federal permitting involved, and whether to what extent there
is a federal litigation risk associated with that permitting.
You add more things on top of that, including a royalty, a new
royalty, whether that's gross or even net, doesn't that, in
many circumstances, chill investment in the United States and
effectively drive it elsewhere?
Mr. Somers. Absolutely, and I think it also goes in
opposition to what many of the states are trying to do to bring
investment to their state. So in Utah, for example, over the
past few years we have passed two different tax credits that
incentivize mineral exploration and also high-cost
infrastructure associated with mining operations and other
extractive operations. And so, if you have the states moving in
a direction where they are trying to incentivize production and
exploration in order to attract that investment, but on the
federal side, you are moving in the other direction, then you
are really canceling those efforts out.
The Chairman. Right.
Mr. Somers, how would you compare interacting with federal
authorities on permitting and other matters to state
regulators? For example, the Utah Division of Oil, Gas, and
Mining, sometimes referred to as DOGM. What are those two
experiences like?
Mr. Somers. I think, in many cases, you know, as I
mentioned in my testimony, it's very important that we protect
primacy for states so that we can manage as many of these
federal laws and regulations as possible. But in general, I
mean, the state agencies tend to be more responsive because,
frankly, we can call their bosses. I mean, we can call, you
know, the head of the Department of Natural Resources, where
DOGM is. We can, you know, call the Governor, legislators, and
get responses there. Whereas, you know, trying to fix problems
on a federal level becomes much more difficult, you know, and
not to say that we don't have opportunities to influence those
agencies through working with our federal delegation and other
things, but you know, as a general principle, I think, you
know, the government closest to the people functions the best,
and we find that in regulatory agencies as well.
The Chairman. Do you find--is there any kind of inferior
environmental outcome or greater risk of environmental harm as
a result of a decision where jurisdiction is vested in a state
agency, for example, the Utah Division of Oil, Gas, and Mining,
as compared to federal authorities?
Mr. Somers. We have not witnessed that in Utah.
The Chairman. So the biggest significant difference, if I
am understanding you correctly, is the amount of time, the
amount of delay, and the uncertainty--shorter, greater
certainty with the states without a diminished environmental
outcome?
Mr. Somers. Correct.
The Chairman. Thank you.
Senator Heinrich.
Senator Heinrich. Actually, Senator Murkowski hasn't had a
chance to even have her first round, so I would defer to her.
The Chairman. My peripheral vision was off.
Senator Murkowski. I know, I am so far down the dais here,
but that's okay. I show up, and that's so much of what matters.
The Chairman. My wife would call that male refrigerator
blindness, and it claims many victims.
[Laughter.]
Senator Murkowski. I am going to have to remember that one.
I want to thank you for having this hearing. As one that's
been focused on the issue of critical minerals and the
vulnerability that we have in this country when it comes to
being able to access our own, and the increasing reliance on
countries like China, this is a key issue, and I am glad that
the Committee is taking it up so early.
Mr. Somers, I wanted to start with you. There was an
interesting article in the Wall Street Journal just a bit ago
entitled, ``Why the U.S. Keeps Losing to China in the Battle
Over Critical Minerals.'' You may have seen it. But it tells
the story of Syrah. This is an Australian company that--I have
cited this story a fair amount in the Biden Administration
because what we saw was hundreds of millions of U.S. taxpayer
dollars that went to support that, even though they were
planning on sourcing the graphite from a very unstable part of
Mozambique. It's one of those sources of frustration. You watch
this whole project. Syrah goes into force majeure last year,
and so, everything that the U.S. taxpayer has put out there is
at risk, at jeopardy, and you have continued unrest in
Mozambique. To me, this was a situation where you had just no
common sense when it came to the federal investment decisions.
And then, I will submit to you that we have some
opportunities in our own country to be smart about our
investments, lower risk investments here at home. My colleagues
have heard about the potential for Graphite One, the largest
natural graphite deposit in North America. We pushed, we
pleaded, we did everything that we could to raise the profile
on this. We did get support from the Defense Production Act.
That was helpful. But when it came to Department of Energy, it
was really pretty tough to get any attention here. So I am
looking at this, and at least with the previous Administration,
seeing this unwillingness for the Federal Government to invest
in projects here at home.
And so, my question to you is whether or not you think it
would be wise, advisable, to have some kind of a requirement
for any federal investments in mineral processing to be tied to
the extent practical to domestically sourced minerals, because
we know we are not doing the processing. We want to bring
processing here. But also, it doesn't make sense if we are
getting the raw materials from other countries. Speak to this
if you would, please.
Mr. Somers. Absolutely, I think that would be a very wise
requirement. And again, in my testimony, I mentioned that just
in Utah we have 40 of the 50 critical minerals on the DOI list,
you know, and you add the graphite that you mentioned in your
home state, and mineral occurrences in other U.S. states, there
is really very little reason that we need to go outside of the
U.S. to source these minerals. And again, if we have both the
extraction and the processing happening here domestically, then
that really does shore up our supply chain and ensure that we
don't have those economic and national security risks.
I would also say that in many cases, not only are there
natural deposits, but in the case of graphite, for example----
Senator Murkowski. Synthetic.
Mr. Somers [continuing]. There are opportunities, you know,
there are projects right now, currently, in Pennsylvania and
West Virginia that are getting graphite from coal, you know,
with off-gassing of hydrogen, which can be used for electricity
generation. And so, there are many opportunities for us to be
innovative as well and not rely on unstable countries in order
to extract the raw resources.
Senator Murkowski. Well, thank you for that.
Let me ask a question of you, Mr. Haddock. In your written
testimony you briefly mentioned the Bureau of Mines. This was
abolished back in the '90s. You didn't specifically call for
its resurrection, but given the importance of what we are
talking about here today, it's something that I have certainly
thought about. We have a Department of Energy. Maybe we want a
Bureau of Mines to look at our mineral security and our
competitiveness. So what do you think about the idea? What
would a modern Bureau of Mines look like? What functions would
they be responsible for?
Mr. Haddock. Thank you, Senator. That's a great question.
In my mind, as I was looking at these critical minerals
bills, and everybody was talking about all the coordination
between all these various agencies, and this agency could do
this and that, it just felt like there is a need for
centralization here. And also, one of the things that I have
talked about before and I have advocated is that there needs to
be a knowledge base of, you know, as private explorers are out
working, we need to find a way to be able to share the
information that's critical to knowing where these byproduct
minerals are, and in small concentrations. And so, I don't know
exactly what it would look like, but I certainly know, in a
business world, you would create a focus on that with a small
group of people with the right expertise and focus on those
very narrow questions.
Senator Murkowski. Good, well, thank you for that. That
might be something that the Committee would want to explore,
Mr. Chairman. You know, where we are trying to eliminate a lot
of bureaucracy nowadays, but when you are focusing in an area
as significant as this for our entire economy, it seems to me
that we might want to give a little more definition. And so,
certainly something that I would love to work with you all on.
Thank you, and I appreciate all of you being here today,
and Senator Heinrich, thank you for the courtesy of the
refrigerator look over here.
[Laughter.]
The Chairman. Thanks so much, excellent suggestion.
Senator Heinrich.
Senator Heinrich. I am going to defer to Senator
Hickenlooper. I know he has a second round.
Senator Hickenlooper. Great. Let me get back to my question
there. I got distracted for just that moment. It's always the
case.
You guys have been talking a lot about supply chain, and I
think that's at the essence of all of these things. Again, I
want to go back to Mr. Somers.
The National Critical Minerals Council Act, to ensure that
we are, you know, coordinating minerals policy at the highest
level of government. Can you elaborate on why it's essential to
elevate critical minerals to the highest levels of the White
House, obviously, but also to the agency, and how a national
council or a minerals advisor could enhance that?
Mr. Somers. Absolutely, and I would like to echo what Mr.
Haddock said. I think that, you know, more centralization in
the Federal Government would be very beneficial in whatever
form that takes, a Bureau of Mines or a National Critical
Minerals Council or Minerals Czar. I am not sure exactly, you
know, what that should look like specifically, but I think that
ensuring that the Federal Government is working together, and
you have the Department of Energy, the Department of the
Interior, the Department of Defense, and the Trade
Representative, and others, I mean, all the different parts of
government that need to be involved in these discussions so
that, you know, we are, again, maximizing our opportunities to
be self-sufficient with our critical minerals supply chain and
also dealing with trade issues and other issues that can affect
investment here in the U.S. is absolutely essential.
Senator Hickenlooper. I appreciate that more than you can
imagine. I think collaboration and coordination is going to be
in high demand.
Mr. Wood, and this is just, again, someone who also loves
trout, and like many of your members, I enjoy taking the trout
out of the water, but also putting them back.
Mr. Wood. Yes, that's good. That's good.
Senator Hickenlooper. I think we have some of the largest
trout, I think, in the country, if you don't recognize that
yet.
Mr. Wood. Yes, you do.
Senator Hickenlooper. What actions can Congress take to
reduce the impacts of some of these new mining projects? What
have we not talked about yet where we could get better value?
Mr. Wood. You know, I think we have talked about several
topics already that would reduce impact. I will say that modern
mining is a lot different than historic mining practices. These
are well-regulated industries. Most of them are well-
capitalized. I do think that the two biggest problems with the
mining law, I don't think are that unfixable. One is, as I
mentioned earlier, creating a dedicated funding source or
royalty, and the second issue would be making clear that there
is discretion for denying a mine permit early in the process.
Senator Hickenlooper. Right. I agree. Perfect. Thank you, I
appreciate that. Obviously, that's a discussion that could go
on for some hours.
Mr. Wood. Yes.
Senator Hickenlooper. Mr. Haddock, we talked about a better
path forward for mining in this country by simpler permitting
processes, you know, faster responses, but making sure that we
have the highest environmental standards. And I guess I could
say, actually to all witnesses, we have already covered a
number of the permitting bottlenecks that mining companies face
on projects. But as we resume on this Committee bipartisan
discussions and solutions, what would you think--each can
suggest one--what should be our highest priority?
Mr. Haddock. I will start. Pass the Mineral Regulatory
Clarity Act.
Senator Hickenlooper. Okay, that's fair.
Mr. Somers.
Mr. Somers. Again, I think that there has been a lot of
discussion about permitting reform, and that is absolutely
critical, and also litigation reform.
Senator Hickenlooper. There you go.
Mr. Wood. And I would say, again, funding to clean up
abandoned mines and allowing some more discretion in the
process for areas where you shouldn't mine.
Senator Hickenlooper. All right, absolutely. Well, the
Ranking Member described, what was it, the $54 billion backlog,
and yet, the billion dollars a year that you mentioned really,
it's almost just taking care of what is happening, you know,
day to day with existing mining, as small as it is. But anyway,
somehow that has got to come together as well, as we get
ultimate solutions.
Anyway, thank you all, I appreciate your work, and look
forward to working with you going forward.
I yield back.
The Chairman. Okay, I really appreciate all three of our
witnesses for coming here today. You have offered some very
valuable testimony that we have all benefited from. As you can
tell, these are issues on which there is a lot of bipartisan
consensus--not always on the discrete policy proposals at hand,
but in many areas there is. At a minimum, there is a lot of
bipartisan consensus over the importance of these issues, and
that leads often to legislative consensus, or very nearly such.
We have some brief housekeeping before we wrap up.
I ask unanimous consent to enter into the record some
letters of support for S. 714, the Critical Mineral Consistency
Act, and S. 544, from the following organizations: the National
Mining Association, the American Exploration and Mining
Association, and Citizens for Responsible Energy Solutions also
submitted one.
And without objection, so ordered.
[Letters for the record follow:]
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The Chairman. The record for this hearing will remain open
for two weeks.
We thank the witnesses, and we stand adjourned.
[Whereupon, at 11:25 a.m., the hearing was adjourned.]
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