House passes mining reform

The House passed a bill 244-166 Thursday to reform the 1872 Mining Act and to slap royalties on minerals extracted from public lands such as gold, silver, copper and uranium.

Congressman Nick Rahall, D-W.Va., sponsor of the bill, said the legislation would “drag the 1872 Mining Act into the 21st century."

The House bill, if passed into law, would establish an 8 percent gross royalty on profits from mining on federal land for new mines and a 4 percent royalty on existing mines. Currently, there are no royalties paid by hard-rock mining companies.

President Bush has threatened a veto, opposing the bill as economically repressive.

“In Arizona, hardrock mining has left behind a legacy of contaminated lands and rivers, abandoned mines leaching poisonous metals into groundwater, and other hazards to the public," said Rep. Raul Grijalva, D-Ariz.

Grijalva and Rep. Gabrielle Giffords, D-Ariz., have opposed the proposed Rosemont Mine in the Santa Rita Mountains east of Green Valley. Giffords described the House bill Thursday on the floor as, “An important piece of legislation, long overdue."

However, Giffords spokesperson CJ Karamargin said she, “Is concerned the royalty may be too high. She supports a royalty, but wants to make sure the level is appropriate, and it won’t shut down the industry.”

The Sierrita Mine in Green Valley is owned by Freeport McMoran, Inc., which acquired Phelps-Dodge. Company Vice President Peter Faur was careful in his assessment of the legislation.

“I can tell you that for the past 20 years, (Phelps Dodge) has consistently supported mining law reform because it will provide more certainty to the industry," Faur said. " We have played a key leadership role within the industry to try to secure passage of fair legislation and we intend to continue that role.”