Could EPA’s Alaska ‘overreach’ spell disaster for due process nationwide?

By M.D. Kittle | Watchdog.org

MADISON, Wis. – As the Environmental Protection Agency takes its first step in killing a multi-billion dollar copper-and-gold mine proposal in Alaska’s outback without having seen the plan, critics of the EPA’s “preemptive veto” warn the action could have a chilling effect well beyond the boundaries of the Ohio-sized Bristol Bay region – where brown bears outnumber human inhabitants.

While the agency’s administrator insists the Bristol Bay Watershed – home to half the world’s sockeye salmon population and a vocal and powerful fishing industry – must be protected, even critics of the mine say EPA’s power play is an attack on the basic right of due process.

“The EPA is deciding it can do whatever it wants,” Luke Popovich, spokesman for the National Mining Association. “If it can decide to (preemptively veto a project) for this industry, there is no reason it can’t ignore the legal process and preempt other projects from going forward.”

In announcing the agency will take action to block or greatly restrict the Pebble Mine, EPA Administrator Gina McCarthy told reporters “extensive scientific study” has given the agency “ample reason to believe that the Pebble Mine would likely have significant and irreversible negative impacts on the Bristol Bay Watershed and its abundant salmon fisheries.”

But the EPA’s “extensive scientific study” has been panned by several scientists in peer review, asserting that the agency’s science and assumptions are flawed.

Last August, the House Science, Space and Technology Committee’s Subcommittee on Oversight hearing probed the EPA’s Bristol Bay Watershed Assessment, raising questions about the agency’s use of a hypothetical scenario in trying to gauge the impact of a proposed mine.

EPA’s push to preemptively stop or drastically restrict construction of the mine is based on a finding from the assessment’s models of what a large-scale mine could look like. Pebble Limited Partnership, the developer behind the proposed mine project, has yet to present its full plan to regulators.

“I think the impact is going to be huge,” Tom Collier, CEO of PLP, told Watchdog in an interview Monday.

Collier says his company has pumped some $600 million into the project. That kind of investment for other mining projects in Alaska and around the U.S. will be hard to come by if the EPA uses its regulatory atomic bomb – Section 404 of the Clean Water Act.

“The oil and gas industry, mining and all other major construction industry projects that have to deal with 404s are starting to understand this is going to be quite discouraging. It’s going to have a very negative impact on these projects,” the CEO said.

Uncertainty and the constant looming EPA threat drove Pebble Limited Partnership’s biggest player, Anglo American PLC, out of the project last year.

“Despite our belief that Pebble is a deposit of rare magnitude and quality, we have taken the decision to withdraw following a thorough assessment of Anglo American’s extensive pipeline of long-dated project options,” Anglo American CEO Mark Cutifani said in a release last September.

“Our focus has been to (prioritize) capital to projects with the highest value and lowest risks within our portfolio, and reduce the capital required to sustain such projects during the pre-approval phases of development as part of a more effective, value-driven capital allocation model,” he added.

Following the announcement, U.S. Sen. David Vitter, R-La., called out the EPA, asserting Anglo American bowed out because of government overreach.

“This is a prime example of why the economy isn’t recovering. EPA and their far-left environmental allies are using unprecedented tactics to shut down potential projects and corresponding jobs before they’ve even begun the permitting process,” said Vitter, top Republican on the Environment and Public Works Committee, in a statement.

A 2012 report by the Brattle Group consulting firm estimated roughly 60,000 development projects, worth about $220 billion, need Section 404 permits every year.

McCarthy said the preemptive measure isn’t something EPA does very often, but “Bristol Bay is an extraordinary resource.”

Since the Clean Water Act went into effect in 1972, the EPA has launched the process 29 times and issued restrictions only 13 times, according to McCarthy.

Critics assert the EPA’s use of the Clean Water Act provision on the proposed Pebble Mine project is just the beginning of an Obama administration push to stymie critical resource development, part of an overall strategy in the president’s climate change agenda.

The National Mining Association’s Popovich points to the EPA’s controversial tougher standards limiting carbon emissions from new power plants, which, critics say, could effectively end the construction of new plants. Industry officials and others have billed the EPA’s stance as the agency’s “war on coal.”

Pebble Limited Partnership plans to fight the agency’s action. PLP recently filed a formal request with the EPA’s inspector general calling for an investigation into the Bristol Bay Watershed study, to track how it was conducted and just who was driving it.

But EPA officials say the agency is basing its action on available information, including Pebble Limited Partnership mine plans submitted to the Securities and Exchange Commission.

“The science EPA reviewed paints a clear picture: Large-scale copper mining of the Pebble deposit would likely result in significant and irreversible harm to the salmon and the people and industries that rely on them,” Dennis McLerran, regional administrator for EPA Region 10 said in a statement.

Passions are flaring on both sides, but even those diametrically opposed agree that a preemptive veto of the Pebble project would be injurious to due process and the prospect of development nationwide. That basic agreement is playing out in Alaska’s divided political lines.

U.S. Sen. Mark Begich, D-Alaska, who has made a very public show of his opposition to the Pebble Mine, said he is “skeptical of federal overreach from an administration that has already demonstrated it does not understand Alaska’s unique needs.”

“The residents of Bristol Bay and Alaska Peninsula need certainty to plan their future and I will be making sure the administration does not take any actions that could have unintended consequences down the road for this region or other development projects in Alaska,” Begich said.

U.S. Sen. Lisa Murkowski, R-Alaska, said a preemptive veto would set a “terrible precedent for development.”

“If the EPA has concerns about the impact of a project there is an appropriate time to raise them – after a permit application has been made, not before. It is clear that a preemptive veto is still being considered by EPA. Such a veto is quite simply outside the legal authority that Congress intended to provide EPA,” Murkowski said in a statement.

Contact M.D. Kittle at mkittle@watchdog.org

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