Minnesota Mineral Leases Approved By State Officials Despite Objections

06/01/2012 10:54 am ET | Updated Aug 01, 2012

ST. PAUL, Minn. (AP) — A panel of top Minnesota officials approved the sale of 77 mineral rights leases Thursday to four companies that want to prospect for copper and other valuable metals in the state's scenic northeast, overriding the objections of home and cabin owners.

The Executive Council, made up of Gov. Mark Dayton and the state's other constitutional officers, deferred a decision when it met last October. Members wanted to give opponents time to take their concerns to the Legislature and to give the Department of Natural Resources the opportunity to update its practices for notifying landowners who might be affected by minerals leases.

While members all expressed sympathy for landowners who may have to let prospectors conduct noisy drilling on their property, they said the companies met their requirements so there was no legal basis to reject the leases.

About 25 percent of the nearly 22,000 acres covered by the 77 leases is privately owned. Those property owners, like most in Minnesota, don't hold mineral rights, which normally belong to the government. In years past, the Executive Council routinely approved minerals leases with little if any debate, but the property rights issue has come to the fore amid a new, broader debate over plans for mining what are believed to be vast untapped reserves of copper, nickel and precious metals in Minnesota.

Bill Travis, president of IDEA Drilling LLC, of Virginia, Minn., was among the mining proponents who touted the jobs that exploration is bringing to the area. He said his company has grown to 140 employees and will be adding a 20th drill rig in June to keep up with the demand.

"Mineral exploration and mining is a bright spot in an otherwise dreary economy," Travis said.

Travis said he's added about 70 employees over the past 17 months and pays drillers $70,000 to $100,000 a year while other employees earn $35,000 to $65,000 a year.

Ernest Lehman, of Minneapolis-based Vermillion Gold, one of the four winning companies, said prospectors have a lot of work ahead before they start drilling. He compared finding nonferrous metals to searching for a needle in a haystack. He said they'll first need to conduct extensive but nonintrusive studies on the surface to identify which sites merit even sinking a drill hole. And only a few of them are likely to warrant more drilling, he said.

"It's a very rare thing," Lehman said.

Several home, cabin and business owners from the affected area, which lies mostly between Ely and Isabella, unsuccessfully urged the council to withhold the leases on private land as a compromise.

Gus Axelson, of Maplewood, brought his wife, Amy, and sons Anders, 9, and Henrick, 4, saying he wanted the council to see the hands that helped peel the logs they used to build their cabin near Isabella.

"If you approve these mineral leases, you'll be giving the mining companies the option to seize our family cabin. And you'll have to do that with my family — my boys — watching. And you'll have to go home today with that on your conscience," Axelson said.

State law allows the government — not mining companies — to condemn private land if the owner refuses to allow exploration on it. But Kathy Lewis, assistant director of the DNR's Lands and Minerals Division, said that power has never been used as far as she knows.

The landowners, however, said they feel like they will have little choice but to give in if drillers demand access to their land.

"We want to play in a fair game and this isn't a fair game," said Don Humay, a member of the Eagles Nest Township Board, as he slammed a baseball down on the table in front of Dayton. The governor later autographed the ball and gave it to Anders Axelson.

Mining presents a political dilemma for Dayton and the other council members — Lt. Gov. Yvonne Prettner Solon, Secretary of State Mark Ritchie, Auditor Rebecca Otto and Attorney General Lori Swanson. They're all Democrats and some are thought to have higher political ambitions. Their party's important labor and Iron Range constituencies support mining, but environmentalists oppose it.

Steve and Ron Brodigan, who own land near Isabella that's part of the leases, said the political pressure from mining supporters was too much to overcome. They said they're keeping their options open, including a possible court challenge.

Dayton pointed out that Minnesota severed mineral rights from surface rights over a century ago. He said it wouldn't be easy to get the Legislature to change the law, but the property owners have the right to try.

"I don't think this is a closed subject by any means," Dayton said. "And I think as it proceeds it's going to become even more controversial in this state."

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