Rio Tinto is headed for another cultural battle over Indigenous mining land after it was granted approval by the US government for a land swap in Arizona on grounds sacred to Native Americans.
The US Forest Service (USFS) published a
final environmental impact statement (FEIS) on Jan. 16, that finalizes a land
swap at Oak Flat in Arizona for Rio's Resolution Copper mine, which has faced
increased scrutiny from Native American tribes on the grounds that it will
destroy sites of cultural and religious significance. The agency also published
a draft record of decision indicating it will issue, pending review, permits
for use of power lines, pipelines, and roads in the area.
The scrutiny comes less than a year after
Rio provoked public and investor outrage when it blew up 46,000-year-old
Aboriginal heritage sites in Western Australia during a mine expansion. This
led to the departure of the firm’s then-CEO Officer Jean-Sebastien Jacques and
two other key managers.
The swap, part of a 2014
deal engineered by former Republican senator John McCain and approved by
Congress, will give Rio and BHP 2422 acres of government land, including 760
acres known as Oak Flat in the Tonto National Forest. In exchange, the
companies will hand back 5459 acres of other land around Arizona to the US
government. The government must execute the land swap within 60 days of the
environmental statement’s publication, a stipulation laid out in a 2014 law
signed by then-President Obama.
The mine, which is 55%
owned by Rio with the rest held by rival BHP, could supply a quarter of US
copper demand if developed and generate more than US$280m in annual taxes,
according to the US Forest Service. Rio and BHP say that the project could
produce as much as 40Blbs of copper over the next four decades and create
thousands of jobs. “We have to balance demand for mineral extraction and the
related economic benefits with our commitment to environmental stewardship and
sustainability,” said the Forest Service’s Tom Torres. “This project is
complex, and the impacts were rigorously analysed.” This sentiment was echoed
by Arizona Governor Doug Ducey, a Republican, who praised the decision, saying
the state “can have a robust mining sector while protecting our environment and
cultural history.”
Resolution is set to pose
an early challenge for new CEO Jakob Stausholm, who was tasked with improving
ties to local communities. The mine is caught between the wider struggle between the preservation
of the environment and historical lands and miners desire to extract more
copper, needed for the clean energy technologies to reduce global emissions. The
project may also present a task for President Biden, who has pledged to both
preserve the environment and speed up the transition to clean energy, which
will require more copper.
Mr Stausholm will also need to made headway in resolving an
increasingly messy situation in Mongolia, where Rio’s most important growth
project, the US$6.75bn Oyu Tolgoi copper mine, has been hit by delays and cost
blowouts that have led to disputes with the country’s government and the
company’s minority partners. The mine, set to be the world's fourth-largest
copper mine when completed, could make up 7% of Rio’s attributable cash profits
in 2028, when it ramps up to 480kt of copper per year.
In an attempt to avoid repeating mistakes of the past, Rio said
it would continue to engage with Native American tribes and seek consent before
any decision on the development of the project. Resolution Copper’s project
manager Andrew Lye wrote to 11 Native American tribes in December, seeking to
increase direct engagement with the groups. Resolution is committed to “careful
and respectful treatment” of any Native American artifacts or ancestral remains
found on the property, Mr Lye said in the letter. “We will comply with all laws
related to Native American cultural heritage and will strive to do more,” he
added. Meanwhile, BHP said it
recognizes the land “has historical cultural significance for Native American
tribes” and plans to monitor Resolution’s tribal negotiations. The vice
chairman of the White Mountain Apache Tribe, Jerome Kasey III, in a November
letter acknowledged its inclusion in the consultation process, with the project
"ensuring the inclusion of the tribal voice".
Some Native Americans
work for and support the Resolution project, though many others have vowed to
forcefully oppose it. Prior to the publishing of the environmental study, Native
American groups, such as the San Carlos Apache tribe, requested a restraining
order that would have prevented the government from publishing the report. US
District Judge Steven Logan denied the request, given that the two sides did
not talk, which is required under legal stature. San Carlos Apache tribe chairman
Terrry Rambler previously told an Australian parliamentary that: “Like the rock
shelters at Juukan Gorge, Oak Flat is a sacred and holy place that Resolution
Copper greedily seeks."
Following the FEIS
release, the public has 45 days to object to the draft decision on the mine
plan, and the USFS must respond and address any concerns within 90 days.
Despite all the attention the project has received, it is not being
fast-tracked and remains in the permitting and study phase. The Biden
administration will oversee permitting that must be approved in the next few
years, during which time the companies will decide whether to invest in
construction. “BHP funding decisions in relation to Resolution Copper will be
contingent upon the project satisfying both commercial considerations and
alignment with our values, policies and practices in relation to the rights of
indigenous peoples.”
Copper's importance is
set to grow on the global shift towards decarbonisation, which will fuel huge
demand for the commodity used in grid electrification, renewable power and
electric vehicle batteries. But this will coincide with increasingly stringent
environmental and cultural considerations, which are increasingly dominating
the zeitgeist, and companies will need to learn to adapt.