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Landowners wary as DNR delays mineral lease decision

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Landowners wary as DNR delays mineral lease decision
Two Harbors Minnesota 109 Waterfront Dr. 55616

The Minnesota Department of Natural Resources has pulled a proposal for mineral exploration leases off the agenda of the Minnesota Executive Council set to meet this week at the Capitol in St. Paul.

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The council, comprising the state's top elected officials, considered the mining leases in June but kicked them back to the DNR for more work.

DNR leases, some of them for private property where landowners don't own the mineral rights, are located where state geologists and mining companies think there may be valuable deposits of copper, nickel, gold, and other minerals that might be mined in the future. The high bidder gets exclusive rights to explore and drill at those sites for 50 years, with the state recovering royalties for any minerals mined.

The issue has attracted broad attention in recent weeks, part of the building debate over mining expansion in the state, as opponents geared up to testify against the DNR's plans. But the DNR pulled the mining issue Thursday after a meeting between Gov. Mark Dayton, top DNR officials, and other staff.

Larry Kramka, DNR Lands and Minerals Division director, said the DNR was unable to notify all private landowners affected by the leases in time for the council's Wednesday meeting. Instead, the DNR will send landowners notification in coming weeks and ask the Executive Council to hold a special meeting in October to approve the leases.

Kramka said the DNR doesn't plan to remove any of the proposed leases from the package.

"We were asked by the council in June to identify the landowners involved, and we've done that, and to notify them in advance of the (council's vote) and we're going to do that," Kramka said. "Our plan is to bring the entire package back to the council in October."

Frank Ongaro, executive director of Mining Minnesota, a mining industry group, called the delay "unfortunate."

"There are companies that, if they had their lease in hand, as they should by now, would be out there prospecting, or getting ready to," he said. "There's a lot of competition globally right now for mining investment and any hiccup like this isn't good for Minnesota's mining future."

Landowners affected by the DNR leases also are concerned.

"I don't consider this any kind of reprieve. I think they (DNR) are going to come back in October with bigger guns and ram this through," said Ron Brodigan, who owns land in Lake County near Isabella, where he operates the Great Lakes School of Log Building. Some of Brodigan's land is over mineral rights owned by the DNR and included in this round of leases.

Opponents to the leases say most Minnesotans don't realize that mineral exploration and mining interest is expanding into new areas of the state's north woods, far beyond the traditional Iron Range, surprising cabin owners and homeowners who never expected to own land where mining might occur. The state, until now, hasn't informed landowners when the mineral rights under their land were up for auction to mining companies.

Brodigan says he isn't opposed to mining but that the state's system of auctioning mineral exploration leases is broken and needs fixing.

"I don't think we can stop this. But we are hoping we can at least get the state to pull the leases that are under private land," he said. "They're already drilling just a few miles away, though, so I don't think there's any way to win in this ... other than selling my place and moving away."

How we got here

In April, four mining companies bid on 77 mining units on about 22,000 acres under which the state owns the mineral rights, much of it in western Lake County, near Isabella, an area thought to be promising for copper-nickel deposits. The DNR had offered 652 mining units across 226,000 acres in Lake, St. Louis, and Koochiching counties in April, but many areas did not receive bids. About 20 percent of the total units offered were under private land.

Minnesota's Executive Council - Gov. Mark Dayton, Lt. Gov. Yvonne Prettner Solon, Attorney General Lori Swanson, Secretary of State Mark Ritchie, and Auditor Rebecca Otto - meets quarterly to make decisions on state real estate and investment actions, including mining leases.

The June action by the council was the first time since 1982 that a DNR lease package wasn't approved, DNR officials said. Mining supporters - and official state policy - say the leases are a critical first step to tapping the state's vast mineral wealth, leading to new types of mining, hundreds of jobs, increased tax revenue, and huge royalties for the state to pay for schools, roads, and more.

The leases are a critical element of mining exploration as mining companies try to hone in on where the best deposits are. Some exploration can be done by aerial surveys, other through seismic testing on the ground. But the final stage usually involves drilling deep underground to verify what's there.

"It's the big first step in the process of prospecting. These leases are part of the company's programs to determine where there are deposits of these metals," Ongaro said.

But opponents say the system is stacked against landowners, some of whom didn't realize they don't own what's under their own land. And others say the state is allowing too much prospecting too fast. Still others oppose any new venture into copper mining, saying potential environmental impacts, such as sulfuric acid runoff, aren't worth the risk.

Across northern Minnesota, especially on land that was once controlled by the government, even 100 or more years ago, many private parcels are on top of mineral rights retained by the state or federal government.

If you don't know whether you own the mineral rights under your property, check your property abstract. Any severance between surface and mineral rights must be recorded in the abstract. More information is available at http://files.dnr.state.mn.us/ lands_minerals/mineral ownership.pdf.

Several companies are prospecting for copper, nickel, titanium, platinum, gold, and other metals across northern Minnesota - from Aitkin County to Lake County - including PolyMet, Franconia, Twin Metals, Cardero, Kennecott, Teck, and Encampment Minerals.

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