Recently in Mining Category

New Law Allows Mining Operators to Remedy Compliance Issues and Retain AB 3098 List Status

April 9, 2014

by Kerry Shapiro and Garrett Colli

This article was first published in The Conveyor, a publication of the California Construction and Industrial Materials Association.

Mining companies are subject to myriad requirements under the Surface Mining and Reclamation Act (SMARA) and implementing regulations that can trip up even the most diligent of operators from time to time. When a potential violation occurs, SMARA holds that either the lead agency or the Department of Conservation (read OMR) may initiate enforcement proceedings by issuing a notice of violation (NOV). All too often, the process results in an order to comply issued against the operator, which in turn can jeopardize the operator's AB 3098 List eligibility. Removal from the AB 3098 List forecloses an operator's ability to sell materials to State and/or local agencies, often a major component of many operators' customer bases.

Enter SB 447. Under this new CalCIMA-driven legislation operators can maintain AB 3098 List eligibility while working to resolve enforcement issues required by an order to comply, and may now also negotiate the terms of, and stipulate to, such an order. These are called stipulated orders to comply.

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SB 1270 Proposes Significant California Mining Reform

March 7, 2014

by Kerry Shapiro, Esq.and Scott Castro, Esq.

The recent submittal of significant proposed revisions to California's mining law, the Surface Mining and Reclamation Act ("SMARA"), signals potentially broad-reaching changes to the statute. On February 21, 2014, Senator Fran Pavely (D) introduced SB 1270, a bill proposing to overhaul various sections of SMARA. SB 1270 proposes fundamental changes to SMARA. Click here for a copy of SB 1270.

If these changes go through, mine owners and operators will be subject to a new regulatory system under which the State will assume a far greater and centralized role in various aspects of SMARA, including mine inspections, enforcement, and establishment of financial assurance mechanisms. The mining industry also faces the likely prospect of increased carrying costs, arising from such proposals as changes to the annual reporting fee structure (proposed at a minimum of $1,000/year on a per-acre basis, and with no maximum cap), to increased ability to appeal decisions relating to the State's "3098" list.

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Endangered Species Act to Trump Mining Claims: Supreme Court Lets Stand Ninth Circuit Ruling in Karuk Tribe of California v. U.S. Forest Service

March 22, 2013

By Scott Castro

On March 19, 2013, U.S. Supreme Court declined to hear an appeal of the ruling in Karuk Tribe of California v. U.S. Forest Service, a Ninth Circuit en banc decision broadly construing the scope of the Endangered Species Act (ESA) consultation requirements.

By denying the petition for certiorari brought by recreational miners and other interests, the Supreme Court lets stand the Ninth Circuit's ruling, which broadens the scope of when consultation is required under Section 7 of the ESA to include instances where an agency makes a decision not to regulate an activity.

For the mining industry and other operations on U.S. Forest Service lands, the Supreme Court's action makes clear that low-impact mining operations that could previously operate pursuant to notices to the Forest Service now are confronted with the likely need to undergo lengthy and expensive consultation under the ESA. For the regulated community in general, the implications are broader, because reach of the ESA's consultation requirement is effectively expanded to apply to instances of agency "inaction."

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Save Cuyama Valley v. County of Santa Barbara: JMBM Scores Significant Victory in CEQA Ruling on Significance Thresholds and Mitigation Measures

February 15, 2013

By Scott Castro

In a decision published on February 8, 2013, the Second Appellate District ruled in favor of the JMBM client Troesh Materials, LLC in a challenge brought pursuant to the California Environmental Quality Act ("CEQA") against the County of Santa Barbara's approval of Troesh's Diamond Rock Sand and Gravel Mine and Processing Facility (the "Diamond Rock Mine"). The decision, Save Cuyama Valley v. County of Santa Barbara (Case No. B233318), ruled on several important grounds under CEQA, and is further notable because it upholds the County's approval of an in-stream mining project within the bed of the Cuyama River. Troesh Materials, LLC was represented before the trial court and court of appeal by JMBM partner Scott N. Castro. The underlying County approval effort for Troesh's Diamond Rock Mine was led by JMBM partner Kerry Shapiro, leader of the Firm's land use group in San Francisco and co-chair of the Firm's Building Materials Group.

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Ninth Circuit Ruling in Center for Biological Diversity v. Salazar Creates Tension Between Federal and California Law Regarding Idle Mines and Interim Management Plans

February 15, 2013

by Kerry Shapiro

As reported earlier this week in this blog, the recent Ninth Circuit Court of Appeals decision in Center for Biological Diversity v. Salazar allowed a uranium mine on federal lands in Arizona to re-open after being idled for seventeen years absent any new federal approval or supplemental environmental review. This decision is notable on its own, but carries added significance in California, where it now highlights a potential conflict between federal and state law regarding idle mines and the resumption of mining operations at such mines.

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Ninth Circuit Upholds BLM's Decision to Allow Uranium Mine -- Idled for Seventeen Years -- to Reopen Without a New Plan of Operations or Supplemental NEPA Review

February 11, 2013

By Scott Castro

On February 4, 2013, a Ninth Circuit Court of Appeals panel issued a ruling in Center for Biological Diversity v. Salazar holding that a mine idled for seventeen years could restart operations without obtaining a new approval from the Bureau of Land Management (BLM) or conducting additional environmental review. The Ninth Circuit's ruling is notable because it clarifies that:

(1) The need for new ancillary permits for an already-approved federal project -- even after being idle for seventeen years -- does not create a "major Federal action" requiring supplemental environmental analysis under the National Environmental Policy Act (NEPA);

(2) A mine may be idle for extended periods of time if the mine is maintained in accordance with an interim management plan set forth in a plan of operations; and

(3) There is no provision under the BLM's surface management regulations (43 CFR subpart 3809) requiring a new plan of operations to restart mining operations following a period of idleness.

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California U.S. District Court's Nationwide Injunction Affects Mining, Oil and Gas, and Timber Activities on National Forests

May 1, 2012

by Scott Castro

This article was first published by Law360. © 2012 Portfolio Media, Inc.

In mid-March, the U.S. District Court for the Eastern District of California issued a nationwide injunction that significantly affects mining exploration activities within lands managed by the U.S. Forest Service. Until this ruling, the Forest Service has relied on a June 4, 2003 agency regulation (located at 36 C.F.R. Part 215) (the "215 Regulation") that exempted from public notice, comment and administrative appeals activities deemed to be categorically excluded ("categorical exclusions" or "CEs") from the National Environmental Policy Act ("NEPA").

In a March 19, 2012 summary judgment ruling in Sequoia ForestKeeper v. Tidwell, however, U.S. District Court Judge Lawrence J. O'Neill invalidated the 215 Regulation's exemption for categorical exclusions.

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Mining Law Update: Army Corps Revised Nationwide Permits Affecting Mining Operations Now Effective

March 21, 2012

by Scott Castro

On March 19, 2012, two new and 48 reissued Nationwide Permits (NWPs) for certain dredge and fill activities requiring authorization under Section 404 of the Clean Water Act or Section 10 of the Rivers and Harbors Act took effect. Nationwide Permits are issued by the Corps under Section 404(e) to provide a streamlined authorization process for dredge and fill activities having minimal adverse effects on the aquatic environment. Every five years, the Army Corps of Engineers issues revised and/or new Nationwide Permits. The last permits were issued in 2007, and expired on March 18, 2012. The current NWPs will expire on March 18, 2017.

Two NWPs are specific to the mining industry: (1) NWP 21, specific to surface coal mining activities; and (2) NWP 44, applying to "mining activities" in general.

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Mining Lawyer: SB 108, A first step in solving the interim management plan problem (Part 3)

October 19, 2011

Kerry Shapiro

This three-part blog series on California SB 108, a bill which changes provisions in the Surface Mining and Reclamation Act of 1975 (SMARA) pertaining to "idle" mines, is based on a paper I first presented at the CalCIMA Conference in October 2011. If you have not yet read part one which gives background on the Interim Management Plan problem, or part two which discusses what SB 108 does and who it affects, you will want read those first.

SB 108: Unresolved Problems and Ideas to Address Them

  1. Application to Active Mines. It is arguably inappropriate to designate as "idle" an operation that is generating returns that seem adequate to support continuing operation and defray ultimate reclamation costs. One solution might be to establish a minimum annual quantity of production as a so-called "safe harbor" to qualify a mine as "active" without regard to changes in historical production level. After all, why should a mine be classified as "idle" simply because it now produces less than it used to? Future legislation could establish a minimum quantity of annual production as a "safe harbor" from classifications of "idle" or "abandoned."

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Mining Lawyer: SB 108, A first step in solving the interim management plan problem (Part 2)

October 17, 2011

Kerry Shapiro

This three-part blog series on California SB 108, a bill which changes provisions in the Surface Mining and Reclamation Act of 1975 (SMARA) pertaining to "idle" mines, is based on a paper I first presented at the CalCIMA Conference in October 2011. If you have not yet read part one of this three-part series, which gives background on the Interim Management Plan problem, you will want read that first.

SB 108: What it Does

Revised Definition of "Idle": SB 108 addresses only one of the substantive issues discussed above, by changing the current definition of "Idle" in SMARA Section 2727.1 to look at the curtailment of production by more than 90 percent of the maximum annual production within any of the last five years, rather than by more than 90 percent of the previous historical maximum annual production. See SB 108 (a copy is attached to this paper). This avoids some of the record problems discussed above and likely limits the
number of operations falling within the definition of idle.

Additional Renewals of IMPs: Currently SMARA allows for renewal of an IMP for an additional 5-year period. SB 108 clarifies that an IMP may be renewed for additional 5-year periods at the expiration of each 5-year period. SMARA Section 2770(h)(2)(A)

Limited Window to Change Mine Status: Although not a substantive change to address the overall IMP problem, perhaps the most significant and practical benefit of SB 108 is the change of status provision. SB 108 adds new SMARA Section 2777.5, to authorize operators to file amended annual reports for prior years in order to revise mineral production or to change mine status from active to idle. One impact of this is to allow mine operators that may have failed to timely file an IMP in prior years (and thus could be subject to claims by OMR of abandonment notwithstanding resumption of production in subsequent years) to either correct production numbers for prior years (thereby avoiding claims of past idleness and failure to prepare a timely IMP) or to properly identify, i.e., change the status of the mine as having been idle in prior years and allow for the filing of a "retrospective" or "late" IMP (thereby avoiding potential claims of abandonment).

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Mining Lawyer: SB 108, A first step in solving the interim management plan problem (Part 1)

October 14, 2011

Kerry Shapiro

This three-part blog series on California SB 108, a bill which changes provisions in the Surface Mining and Reclamation Act of 1975 (SMARA) pertaining to "idle" mines, is based on a paper I first presented at the CalCIMA Conference in October 2011.

Background: What is the Interim Management Plan Problem?

SB 108 is designed to address some (but not all) of the problems existing in the current SMARA statutory scheme regulating so-called "idle" mines through the requirement of submitting an interim management plan ("IMP"). Having passed though the legislature without a single no vote, the bill was signed by Governor' Jerry Brown on October 5, 2011 will be effective on January 1, 2012. This presentation identifies the problems with the current regulation of idle mines though IMP requirements, explains SB 108, including its key terms and the limited window for mine operators to take advantages of SB 108's "change of status" provisions, and finally identifies IMP problems not addressed by SB 108 and proposes ideas for addressing such problems.

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