The acidic, heavy metal-laden wastewater and sludge released from the Gold King Mine into the Animas River in southern Colorado is, in itself, a serious environmental event, but the incident has also revealed issues of greater concern in mining-impacted areas across the United States.
Mining has always been an environmentally intensive activity. Extracting ores from natural deposits requires the movement of massive quantities of materials through underground tunneling or surface excavation. Separation of metals from ore requires mechanical or chemical processes that generate mountains of waste rock and pools of contaminated wastewater. For low-grade ores, cyanide is typically used to extract the metals from rocks on leach pads that may be several acres in area with ore piled to heights of 60 feet or more.
Mining and mineral processing account for more than 44% of all toxic releases into the environment, making it one of the most polluting industrial activities in the country today. The volumes of contaminants, including heavy metals, cyanide, arsenic, radioactive wastes and solid particulate, likely exceed those of pollutants discharged by chemical plants, petroleum refineries, coal- and nuclear-powered electric generation facilities, steel and paper mills, cement plants, heavy and light manufacturing and agricultural operations.
While state laws require mine operators to post evidence of financial responsibility to demonstrate their ability to operate, close and clean up mine sites, the amounts of cash deposits, trust funds, bonds or parent company guarantees to pay have often been inadequate when crises actually occur, and operators have failed to honor their obligations. Bankruptcies are also common among mining companies, leaving state regulators with inadequate funding to safely close mines that continue to cause environmental damage. Ultimately, these costs are borne by taxpayers.
Worse than the pollution from current operations is the legacy of more than 125 years of mining operations that were completely unregulated. The resulting conditions have destroyed watersheds, polluted thousands of miles of rivers and left behind mines like the Gold King. The Environmental Protection Agency (EPA), the Department of Agriculture’s Forest Service, the Department of the Interior’s Bureau of Land Management and Office of Surface Mining Reclamation and Enforcement—all federal agencies that share responsibility for mine cleanups in the United States—do not know how many abandoned mines there are in this country. A 2014 Government Accountability Office study estimated there are more than 161,000 mines in 12 western states where hardrock mining of metal ores is prevalent. Of these, more than 33,000 are thought to have caused, or are still causing, environmental damage. The amounts of contaminants that are seeping into the nation’s rivers every day from abandoned mines far exceed the quantity released from the Gold King Mine in the Animas River spill.
The primary cause of environmental damage from abandoned hardrock mine sites is acid mine drainage, which carries dissolved heavy metals and arsenic into surface water, soil and groundwater. Many mines also left behind tailing ponds with millions of gallons of contaminated wastewater, which can be released into streams and lakes if earthen dams fail or floods overflow impoundments. Mills and ore-processing facilities have added to widespread pollution in mining areas and continue to cause environmental damage today.
Regulation and Remediation
In 1977, mining activities became subject to environmental regulation. These regulations, however, have little impact on the problem of abandoned mines and insolvent or unknown past owners and operators. The Clean Water Act applies to discharges of contaminants that impact surface water and groundwater, including acid mine drainage from abandoned mines, but thousands of old mines continue to leak into streams, rivers and lakes unchecked.
The Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), also known as Superfund, is used to compel polluters to pay for past and present releases of hazardous materials into the environment. For mine sites, however, past owners and operators often cannot be found, and current owners are frequently unable to pay the cleanup costs. That leaves state, federal and tribal governments with the burden of containing pollution and remediating the most serious sites. A current estimate of the costs to close and remediate the 63 hardrock mines on the CERCLA National Priority List (NPL) is $20 billion. The EPA hopes to recover about 20% of these costs from responsible owners and operators. Since the EPA’s total Superfund budget for 2015 is $1.2 billion—and it has more than a thousand other NPL sites of different kinds to address—it is clear that abandoned mines and milling sites will take decades to clean up if there are no changes in the current cleanup plans or funding priorities.
When owners do not respond to environmental problems, the EPA is most often the agency that has acted to stop acid mine drainage and attempt to contain hazardous wastewater from mining operations. That is exactly what the agency was doing when its contractors, acting under the authority of the Superfund Remedial Program, broke through rubble at the entrance of the Gold King Mine and accidentally sent the backed-up wastewater into the Animas River. They were trying to identify the source of and stop a 250 gallon-per-minute flow (360,000 gallons a day) from an inactive mine that was contributing to heavy metal pollution in the river. This daily contamination is from just one of more than 200 mines in the Upper Animas River Watershed that should be investigated and/or remediated to stop continuous releases and other environmental impacts to the river.
As a result of the Gold King Mine spill, the EPA has suspended all investigations and cleanups of mine sites until it has studied what happened and is assured it will not cause future releases. Other state, federal or tribal agencies are unlikely to engage in these activities in light of the potential impact on the EPA as a result of its involvement.
The EPA has instructed individuals and organizations that have experienced losses as a result of the spill to submit claims for reimbursement. Injured parties are asked to file these claims under the Federal Tort Claims Act (FTCA) using a standard government form to report itemized bodily injury and property damage costs. While the EPA could seek immunity under a discretionary function exception to the FTCA, it is unlikely to do so since there is no other party that can step up and conduct the required investigation and cleanup. Therefore, parties, including the tribal nations and states that have threatened to sue the EPA for billions of dollars, should not necessarily expect reimbursement.
Insuring Against Environmental Claims
While the actual costs of losses and cleanup for the Gold King Mine spill will not be certain for months or years, the insurance industry probably will not pay a significant percentage. Exclusions in property and casualty programs will likely render those policies inapplicable. Environmental insurance is available to fill the gaps created by those exclusions, but very few of the parties involved in this incident (including the EPA, state governments, tribal nations, farmers, ranchers, tourist businesses and river expedition outfitters) are likely to have recognized environmental risks as significant or purchased pollution insurance coverage. Water system operators that use the Animas or San Juan rivers as sources of supply were all shut down prior to the spill and intakes were not contaminated. Even if these entities purchased environmental insurance, they typically would not be able to recover losses due to service interruptions unless they actually experienced pollution at insured properties.
People living in the path of possible environmental releases from abandoned mines should evaluate the protection available from site-specific pollution policies to determine whether such coverage would provide cost-effective protection for future events. In calculating their exposure, these parties should consider the costs of business interruption as well as property damage, bodily injury and clean up.
It appears the EPA will pay to clean up the damage from the Gold King Mine spill, which means taxpayers will likely foot the bill. The larger concern, however, is that there is no clear plan currently in place to address the country’s hundreds of thousands of abandoned mines, nor is there a commitment to adequately fund the cleanups that will be required to stop the environmental damage caused by past and present mining activities. As a result, the spill in Colorado may only be a precursor of crises to come.