Mercury storage: Nevada gold operators sue Department of Energy over decision to ship mercury to private Texas facility
In 2008, Congress passed legislation to ban the export of mercury. The legislation, sponsored by then-Sen. Barack Obama, aimed to reduce global emissions of a toxin that can accumulate in food supplies after it’s released in air or water. Congress passed the bill with near-unanimity.
But the export ban left a legacy issue — and a big one for Nevada’s gold mines.
Where there is gold ore in Nevada, mercury often occurs naturally. And in many cases, mercury is recovered as a byproduct of extraction. Since 2006, state regulations have required mines to control the amount of mercury emitted into the air. As a result, more mercury is now stored.
Over time, the effort led to a significant reduction in emissions. But it also meant regulators were faced with a new question: Where should gold mines dispose of their mercury in the long-term?
The options were waning. Congress banned the export of mercury, often released through small-scale mining processes in developing countries. Domestic commercial demand was also declining. Researchers continued to warn of mercury’s harmful health effects, once common in products.
“Nevada’s interest is trying to understand what the long-term plan is for mercury,” said Greg Lovato, the administrator for the Nevada Division of Environmental Protection (NDEP).
That issue could now go before a federal judge.
Two top Nevada gold operators, Nevada Gold Mines and Coeur Rochester, are crying foul over the Department of Energy’s recent decision to designate a private Texas facility as the long-term storage site for mercury generated from their mining. The agency’s decision to use the Texas facility, Waste Control Specialists (WCS), came with a hefty storage fee: $37,000 per metric ton.
Nevada Gold Mines, a joint venture between Barrick and Newmont, told a federal judge that the agency “engaged in a chaotic and ultimately failed effort to meet” a congressional deadline.
“We support the objectives of the Mercury Export Ban Act and an appropriate and efficient approach to taking mercury out of commerce,” Natacia Eldridge, a spokesperson for Nevada Gold Mines, said in a statement. “The DOE has had a long time to work through this rulemaking. That said, as is clear from the record, the agency rushed this rule through the process at the last moment and made errors, which we hope to see rectified through this rulemaking litigation.”
In a similar lawsuit, Coeur Rochester alleged the agency was looking to meet its congressional obligation “through a rulemaking and contract that are irrational, far too costly (at the expense of generators of mercury), contrary to the statute, and contrary to federal procurement rules.”
According to Nevada Gold Mines’ complaint, the joint venture would have to pay about $13.6 million to the agency to store about 370 metric tons of existing mercury. Coeur Rochester said it would have to pay about $3.5 million, or about 10 percent of its net financial results in 2018.
The department did not respond to emailed requests for comment. But the litigation is the latest in a delayed effort to resolve the issue of storing mercury that cannot otherwise be disposed of.
In 2008, Congress recognized the storage question, and it required the Department of Energy to designate a long-term facility to accept commercial mercury from mines and other sources — for a fee. Lawmakers gave the agency until 2013, the year that the export ban went into effect.
Then the agency missed its deadline. Congress extended the deadline to 2020.
Both companies argue that the federal agency short-cutted the public decision-making process in rushing to meet the 2020 deadline. That decision, they said, resulted in setting storage fees that exceeded the amount the gold mining companies would pay for temporary storage.
In the complaints, neither company disputes the need for a fee or a long-term storage facility. Instead, the lawsuits target the agency for its lack of transparency in its rulemaking and how it came to select a private Texas facility over two other vendors that had expressed interest.
When the selection process first began in 2009, the issue of finding a storage location was debated publicly.
The governor of Colorado at the time even came out in opposition to storing elemental mercury at a site the Energy Department was considering in Grand Junction. By 2011, the agency identified Texas-based Waste Control Specialists for storing the mercury.
But the Energy Department never issued a final decision. When the process started again in 2018, the complaints allege that the agency said it would go through competitive bidding.
Then “DOE did a complete about-face,” Nevada Gold Mines’ complaint alleges.
The agency went with Waste Control Specialists in January 2019. That decision was publicly announced at the end of December on the same day Texas regulators modified WCS’ permit.
“On information and belief, DOE and WCS applied for this [permit] modification jointly, months before DOE selected WCS as the facility, months before DOE proposed the mercury storage fee, and before any lease or other applicable agreement was in place,” their complaint says.
WCS declined to comment on the ongoing litigation.
Calculating a fee for mercury storage is difficult, in part, because there are not many long-term solutions for storing it, said Glenn Miller, a professor emeritus at UNR who has studied mercury.
“That's part of the cost of mining gold — dealing with the mercury,” Miller said in an interview. “But I don't have any long-term solutions, other than to store it in Texas and Nevada.”
The lawsuits allege that the agency also failed to analyze the environmental impacts of the fee.
“If it costs $55,417 per metric ton — or $37,000 per metric ton — to deliver elemental mercury to DOE, how will generators respond?” Nevada Gold Mines’ asks in its complaint filed last month.
“Would some generators in the future avail themselves of the significantly less expensive option of treatment and disposal in Canada?” it asks. “Would some generators seek to sell mercury domestically? Would some disreputable generators simply dispose of their mercury illegally?”
Even under the Energy Department’s decision, the long-term future of the mercury remains in question. The fee estimates developed by the agency assume a 15-year storage period. Under federal environmental law, the EPA is charged with creating regulations to dispose of mercury.
As the agency concedes in its rulemaking, however, there is no current treatment for the land disposal of mercury waste. The Energy Department said it was using a 15-year projection for storage, assuming that technology will advance and the EPA will be able to create a treatment.
State environmental regulators, Lovato said, would like to see the agencies work together to come to a long-term solution for disposing of mercury, rather than kick the can down the road.
“There needs to be a final resting place for it,” Lovato said.