Can a copper firm restore a blasted ecosystem?

Introductory editor's note:

Wherever we look in the developed West, we see evidence of misuse: eroding streams, stripped forests, species such as the grizzly hanging on by their claws.

Many believe it is not enough to simply stop the damage. We must also put the West back together. But many in the West are in a state of denial, especially those who blasted the landscape to produce the only goods the region's economy for so long knew how to value: commodities.

Ironically, the owner of the biggest mining pit in the world, the Kennecott copper company, is trying to become an exception. Kennecott wants to clean up the huge pit's pollution without becoming a Superfund site. What the public and the Environmental Protection Agency must determine is whether Kennecott can be trusted to do the job.

Jon Christensen, HCN's Great Basin regional editor, begins his report on page 8.

Feature story:

Salt Lake City, Utah - Preston Chiaro has a huge mess on his hands. The vice president of health, safety and environmental quality for Kennecott Corp., Chiaro is in charge of cleaning up more than 130 years of contamination around the Bingham Canyon open-pit copper mine near Salt Lake City.

Chiaro wants a chance to show that the owner of "the world's richest hole" can clean up its act. "We talk about how modern mining is environmental," he says. "Here's the opportunity to prove it."

But the Environmental Protection Agency wants to put the mine on the Superfund national priorities list of the most hazardous polluted sites in the United States. The listing would allow the federal agency to take over the cleanup and even close the mine.

Chiaro tells the story of Bingham Canyon as he maneuvers through morning traffic on the way to the mine. From Kennecott's high-rise offices downtown, across from the white spires of the Mormon temple, we drive southwest 15 miles across the Salt Lake Valley toward the Oquirrh Mountains.

We come to Bingham Canyon, where over the years miners have hauled out more wealth than was taken during the California gold rush, the Comstock and the Klondike combined. The mine has yielded more copper than any mine in history: more than 14 million tons so far. It continues to produce commodities on a gargantuan scale: half a billion pounds of copper a year, along with 34 million pounds of molybdenum, 2 million ounces of silver and 253,000 ounces of gold.

The pit, now two-and-a-half miles across and a half-mile deep, and the "Yosemite dumps," 1,000-foot-tall man-made mesas of waste rock visible from Salt Lake City, are monuments in progress to the awesome consumer demands that can destroy a landscape. For mining has created a legacy of environmental problems around Bingham Canyon that will endure long after the last pound of copper is taken from the pit.

Spring runoff spread tailings from historic lead mills over the banks of Bingham Creek, where homes would later be built. Piles of waste rock choked streams as the mountain at the head of Bingham Canyon was turned inside out over the last century. And an aquifer under the Jordan River valley and the sprawling suburbs of Salt Lake City was steadily poisoned by acid mine drainage.

Smoke from Kennecott's copper smelter 14 miles away on the shore of the Great Salt Lake turned the northern end of the Oquirrh Mountains into a "moonscape," Chiaro says, and polluted Salt Lake City's air for many years. The wind blew hazardous dust from a mammoth 5,700 acre tailings pile over nearby towns.

In recent years, much of the damage has been controlled. Air quality has improved since Kennecott installed better scrubbers on the smelter smokestack. The company has kept the tailings pile wet so dust no longer blows away on the wind. Trucks have hauled hundreds of loads of contaminated soil from neighborhoods.

Kennecott is well into more than a dozen expensive moving and construction projects to clean up and contain its hazardous wastes, and it is working on plans to deal with major long-term problems, such as the groundwater contamination. Chiaro says it is the "largest voluntary cleanup" ever undertaken by a mining company.

While Kennecott profited handsomely from many of the mining practices that led to these problems - some caused by its predecessors - the company is not undertaking this cleanup simply to atone for the past. Immense wealth remains buried in Bingham Canyon.

Each year, Kennecott makes an estimated $400 to $600 million in profits. It directly employs 2,400 people.

Unlike a lumber company that can cut and run, the mining company must stay in place to get valuable minerals still in the ground. Kennecott is sinking $2 billion into modernizing its operation by replacing its entire copper-making factory. Many of the improvements, such as a new smelter now under construction, mean the mine will run cleaner than required by current regulations. But keeping apace of environmental standards and cleaning up mistakes of the past are just the first steps. Restoring the landscape to a reasonably clean and stable ecological condition is the ultimate goal, Chiaro says.

But it is by no means clear Kennecott can succeed. The EPA certainly isn't sure.

Bingham Canyon is a stage upon which every act of mining in the West has been played out. This hard-rock history began about 35 million years ago, around the same time that mammals began taking over North America, when a giant magma dome pushed up through the fractured sedimentary rocks of the Oquirrh Mountains forming a three-mile wide porphyry rich in copper surrounded by "halos' of lead, silver and gold.

Technically, geologists say, this is a low-grade deposit because tiny grains of valuable minerals are scattered throughout the "host rock." An average ton of ore contains 13 pounds of copper and a minute amount of other metals. In the world of mining, however, that is enough to make Bingham Canyon a fantastically rich ore body.

Mining began here in 1863, when soldiers stationed in Salt Lake City during the Civil War panned for silver and gold in Bingham Creek. Within a decade, mining camps, silver and lead mills, smelters and a railroad spur lined the narrow canyon.

By the turn of the century, a company called Utah Copper controlled most of Bingham Canyon. With capital from the Rockefeller and Guggenheim empires, and steam shovels and engineering know-how from the recent construction of the Panama Canal, Utah Copper began digging the world's first open-pit mine.

In the 1930s, Kennecott acquired a majority interest in the mine on its way to becoming the world's largest copper producer with mines in Arizona, New Mexico and Nevada. The copper titan steadily consolidated its hold on Bingham Canyon by buying everything in its way. Eventually, the pit swallowed most of the canyon and the ramshackle mining town that gave the mine its name.

A century after miners came to Bingham Canyon, the pit had become one of two human creations visible to the first astronauts, along with the Great Wall of China.

In booming post-World War II America, a company that owned a bottomless supply of a basic commodity could hardly go wrong. Copper was an essential element in every new all-electric home and appliance. Kennecott and its employees rode a rising tide of consumer affluence. For decades, management and unions regularly boosted wages and benefits while perilously ignoring environmental damage and changes in the economy.

The mining slump of the early 1980s hit Kennecott hard. Plummeting copper prices almost put it under. After losing $160 million in 1984, and another $40 million in the first quarter of 1985, the mine shut down.

A hard-nosed CEO named Frank Joklik is credited with retooling the rusting regional copper giant into an efficient cog in the global commodities market. Joklik saw that the only way to survive in an era of cut-rate commodity prices was to slash production costs. Kennecott laid off three out of every four workers and forced the survivors to accept wage and benefit cuts and give up cost-of-living adjustments. The mine reopened a year later.

Joklik then convinced a series of corporations that took over Kennecott during the 1980s - Standard Oil, British Petroleum, and current owner RTZ Corp., the biggest mining conglomerate in the world - to invest in an entirely new automated copper production line. As copper prices rose in the late 1980s, Bingham Canyon became the lowest cost, most profitable copper producer in North America.

In many ways, Kennecott emerged a different company. It even lost its name for a while during the merger mania of the "80s. RTZ - the British company's name is pronounced "R-T-Zed" even by American workers - gave the company back its name and its pride with an infusion of capital and a young cadre of managers with a can-do spirit.

Today, even with the threat of Superfund hanging over their heads, Kennecott executives no longer resort to the industry cliché that the mine might be forced to close if environmental regulations get too tough.

"We wouldn't be spending $2 billion if we intended to shut down," says Chiaro. "We need a 30-year mine life to pay off those investments. We fully intend to keep operating. That's what pays for cleanup."

Chiaro, 40, has some experience with Superfund messes. He has worked on a "couple dozen" listings as a consultant and on the ground as a remedial investigator and manager at the Army's Rocky Mountain Arsenal and the Energy Department's Rocky Flats plutonium plant near Denver. He was hired to keep Kennecott off the Superfund list. It is his toughest assignment yet.

"I was a little uneasy about coming to work for a mining company because they don't have a good environmental record," he says. "But I was convinced up to the highest levels that Kennecott is serious about restoring the environment around Bingham Canyon. RTZ doesn't want an environmental smudge on its crown jewel."

Chiaro is working hard to burnish Kennecott's tarnished image and by his own account sparing no reasonable expense. He says RTZ executives were surprised by his initial estimate of the cost of cleaning up around Bingham Canyon, which he pegged at close to $200 million. "But after we peeled them off the ceiling, they bit the bullet."

Kennecott has spent $85 million over the last two years and plans to spend another $80 million this year, he says. The money has paid for a massive landscaping and construction project keeping up to 400 workers and dozens of earth-moving machines busy trying to clean up what miners have torn apart.

"It's a hell of a lot easier to deal with problems up front," says Chiaro, watching a giant shovel scrape dirt from a valley filled with waste rock from the historic Lark lead mill.

"Here we're dealing with a legacy that is 130 years old. In the frontier days, people did what they wanted," Chiaro says. "Everything from lead tailings to household garbage was dumped in the canyon. Waste rock is scattered all around. They basically dumped it on the ground and walked away. But we own the land now, so it's our responsibility."

The worst problems are not all historic. Some are still part of the normal operations of the mine.

When water drains through the waste-rock dumps it becomes acidic and leaches mineral particles out of the crushed rock.

"We take advantage of that," says Chiaro. This acidic water is collected in canals at the bottom of the piles and processed to remove valuable metals. Kennecott gets 20 tons of copper per day from this leach water, which is then sprayed on the dumps again.

"But our capture systems for leach water have not been perfect," Chiaro says. "We're spending a lot of money to correct that."

That is an understatement. Kennecott knew in the late 1960s that a reservoir for holding leach water at the mouth of Bingham Canyon was leaking millions of gallons a day. Last year, under orders from the Environmental Protection Agency, the reservoir was finally dredged and lined with a double layer of plastic containing an electronic leak detection grid. Workers are now building a massive system of concrete dikes and pipes to ring the mine and capture the acidic water that leaches from the waste-rock dumps.

The mine is building a fortress to contain its own mess. Millions of tons of waste rock and "hot spots' of tailings scattered for many miles around the mine have been moved behind these concrete walls. Disturbed areas have been covered with clean topsoil and replanted. From now on, Chiaro says, more land will be reclaimed each year around Bingham Canyon than is torn apart.

But the biggest problem has yet to be tackled: a moving plume of polluted groundwater that threatens the drinking water for much of the Salt Lake City area. "Plume" refers to the portion of water that is contaminated and assumes a plume-like shape as it spreads. Concentrated near the mouth of Bingham Canyon, the plume has a two-square-mile core of acidic water laced with metals similar to the mine's leach water.

Within a mile or so, the acid is naturally neutralized by the limestone that the aquifer flows through. As the water becomes less acidic, the metals solidify and fall out of solution. But salty byproducts called sulfates remain dissolved in the water.

Sulfates, the most pervasive pollutant from mining in the West, can cause diarrhea, especially in infants, although the human body usually can adjust to fairly high levels. Congress debated setting a maximum permissable level for sulfates in the Clean Water Act, but out of deference to the mining industry and communities that have naturally high sulfate levels in their groundwater because of the underlying rocks, failed to set one. The federal drinking water standard for sulfates is essentially a recommendation about the point at which consumers will say the water tastes bad.

This aesthetic standard is exceeded throughout the roughly 50-square-mile plume, under the homes of 70,000 people in the fastest growing suburbs in Utah. A state maximum contaminant level for sulfates, as well as federal and state primary standards for metals such as lead, cadmium and copper, are also exceeded in many wells in the area, making them unsafe for drinking water.

The EPA says the cost of coping with this contaminated groundwater could run as high as $2.2 billion. That's to pump and treat all the polluted water so that it meets drinking water standards, then put it back underground to restore the aquifer. Kennecott favors a $102 million plan to contain the core area of contamination with pumps and to build a treatment plant to deliver clean water to residents in the contaminated area. The plan says the carbonate rocks underground will clear sulfates from the water naturally over hundreds of years.

Between those two options lies a wide-ranging debate about how much industry should be forced to pay for resources it has damaged. It boils down to whether companies should pay to repair damaged resources over the short term or restore them for the long run. It also involves dilemmas of relativity, such as how clean is clean? And it requires determining blame, assigning responsibility, and making prudent decisions about spending millions of dollars on goals that may prove unreachable.

"Valuation of natural resources is like voodoo, it is not an exact science," says Ann Maest, a consultant who has worked on the natural-resource damage assessment around the Anaconda copper mine Superfund site in Butte, Mont.

"With groundwater in Montana, what it would take to clean it up is so much more expensive than what the water is worth today. So they're looking for alternative sources of groundwater."

Groundwater is probably more valuable in populated arid areas such as Salt Lake City, Maest says, and will only get more valuable. But the final decision usually comes in court, she adds, as cleanup and restoration inevitably get mired in litigation.

It happened in Kennecott's case. The roots of this legal tangle go back to 1986. After being shut down for more than a year, the mine was up and running again for a month when Kenneth Alkema, then director of the Utah Division of Environmental Quality, filed notice of a claim against Kennecott for damaging the state's natural resources.

The Superfund law - formally known as the Comprehensive Environmental Response, Compensation, and Liability Act, or CERCLA - requires each governor to designate a trustee of the state's natural resources. Alkema was Utah's trustee.

Kennecott offered to negotiate. And the two sides agreed to conduct a five-year study of the groundwater contamination. In August 1991, a small advertisement appeared among the fine-print legal notices in Salt Lake City newspapers announcing that the state proposed "to enter into a consent decree with Kennecott Corporation in settlement of a natural-resource damage claim." No other details were provided.

Details soon emerged. The state would get $12 million, the estimated market value of the damaged groundwater. The money would pay to replace the water from other sources. It might even be used to help pay the state's share of the Central Utah Project. In return, the state would relinquish all further claims against Kennecott.

The settlement said nothing about stopping the sources of contamination, let alone cleaning the groundwater. Alkema said the EPA would have to pursue cleanup through Superfund.

The deal set off "alarm signals' at the Salt Lake County Water Conservancy District, says general manager David Ovard. The district is the major wholesale water purveyor in the southern suburbs of Salt Lake City near the mine. There are other water companies, towns and agencies affected by the contamination, but the district was the only local agency to "summon the courage" to oppose the deal, Ovard says. Others feared Kennecott's clout and "getting on the wrong side of the state."

The water district stood up to Kennecott because it has a substantial interest in the outcome of the damage claim. Three million acre-feet of water under its service area have been contaminated, he says, 10 times more water than the $300 million Jordanelle Dam will hold. The district may need that water. It also stands to gain if it is cut in on a financial settlement.

Ovard says the district had to intervene because the state was not acting as a responsible trustee of its resources. "The state said if you give us $12 million we'll be out of it," says Ovard. "That's a real cop-out for the trustee. I don't think they cared about cleanup until we intervened. Kennecott had managed everything quite nicely up to that point. I don't think they took us seriously. They intended to roll right over us."

The Utah Clean Water Coalition - a group of environmentalists and community activists - also entered the fray at the urging of the Mineral Policy Center, a national organization advocating mining reform. Kenley Brunsdale, an attorney for the groups, argued that the state's settlement with Kennecott violated a 1989 Appeals Court decision. That decision had struck down Interior Department regulations that authorized a market-value assessment of natural resource damages. The court ruled that Congress intended the Superfund law to promote restoration of damaged resources - a much more expensive proposition.

In October 1992, U.S. District Judge Thomas Greene rejected the proposed settlement between Kennecott and the state for failing to "protect and restore" the damaged resources. The state was putting "the cart before the horse" by settling the claim before the source of contamination was cleaned up, the judge wrote, and Kennecott had failed to prove that the aquifer could not be fully restored.

Moreover, the agreement didn't prevent further contamination, Judge Greene ruled, and it only covered the market value of the contaminated water and not other "option and existence" values. Those values included potential use of the aquifer to store water from the Central Utah Project and the intangible value of groundwater in the desert - the benefits people get just from knowing it is there.

Kennecott and the state appealed to the 10th Circuit Court in Denver to overrule Greene and uphold the settlement. The appeals court dismissed the case Jan. 31, on procedural grounds.

Kennecott and the state have appealed to the U.S. Supreme Court. At the same time, they have begun negotiations on a new settlement that would address Greene's concerns. This time the Salt Lake County Water Conservancy District is at the table.

Kennecott is also trying to cut a deal with the EPA to stay off the Superfund list. William K. Reilly, EPA administrator in the Bush administration, was eager to work out an agreement with Kennecott that could serve as a "model" for avoiding the legal snarls of the Superfund program. But negotiations stalled in the transition to a new administration, which has proved more cautious about making a deal with the mining company.

The EPA would like to settle with Kennecott, officials now say, but on strict terms. The EPA wants at least as much authority to deal with "the big problem' - groundwater contamination - under an "enforceable consent decree" as it would have under Superfund. That means the EPA would be able to use federal money for cleanup and then sue those responsible for triple damages.

"Superfund gives EPA that hammer of enforcement authority to assure cleanup takes place to appropriate standards," says Mike Holmes, EPA community relations coordinator for the Kennecott cleanup.

The EPA faces a dilemma, however. It must decide whether to go along with Kennecott's cleanup or to spend much more money for a full-scale restoration effort that even its own experts agree may not be worth it. EPA experts acknowledge that the aquifer probably never can be completely restored. Because sulfates are not classified as a hazardous substance, the EPA can't compel Kennecott to clean up the entire sulfate plume. It can only force Kennecott to clean up the core of acidic water laced with metals.

The EPA could pay to clean up the sulfates if it puts the site under Superfund. But the best method for removing sulfates from water, a process called reverse osmosis, is costly. The cure can also be almost as bad as the disease: The hazardous brine and sludge left over must be dumped somewhere else.

With Kennecott's work on containing the sources of contamination progressing rapidly, Chiaro says there is time to carefully consider the costs and risks of final remedies for groundwater.

"It's not a dire emergency," he says. "We can think rather than rush in." Kennecott is experimenting with running contaminated water through artificial wetlands stocked with bacteria that thrive on metals and sulfates.

The EPA is skeptical about "constructed wetlands" and unsure whether to trust Kennecott's long-term commitment.

"One has to look closely at this so-called voluntary cleanup," says Bob Duprey, EPA regional director of hazardous waste management. Kennecott has known about some of the contamination since the 1950s, he says. "It wasn't until we started the process of listing that the cleanup work was started."

Kennecott's response is that it has already spent more money on cleanup than has ever been spent on a mining Superfund site.

"Why hit someone over the head with the Superfund hammer when they're already doing the work?" Chiaro asks. "We're assuming liability, one of the main sticking points in Superfund. We want to spend money on cleanup, not attorney fees. We think that's a smarter approach. EPA resources could be better used to track down those who won't take responsibility. My experience with Superfund - it's slow, cumbersome, nothing happens," Chiaro says.

Those sentiments are echoed in the surrounding community, where many people seem willing to give Kennecott a chance to clean up its mess. Although company towns near the mine have become suburbs of Salt Lake City, never a company town, Kennecott has always been a Utah powerhouse and it remains so. The entire Utah congressional delegation, the governor and state legislature, and community and county governments have all come out against the Superfund listing.

"Superfund is appropriate if you have a company that's not stepping to the plate," says Tony Murphy, city manager for South Jordan, the town that sits directly over the groundwater contamination plume. "But if it's contributing to the economy and willing to accept responsibility, why force Superfund on it and spend 35 percent on lawyers fees?"

Murphy says Kennecott and the town of 14,000 people have worked well together on the cleanup of Bingham Creek and getting residents with contaminated wells hooked up to a municipal supply. "We've chosen a different route - to form a partnership," says Murphy.

Advocates for the problem-fraught Superfund program are hard to find. Even some of Kennecott's former critics, who oppose the natural resource damage settlement with the state, support the company's efforts to stay off the Superfund list.

"We're backing Kennecott in avoiding that stigma," says Jim Brusatto, a community activist with the Magna area community council. "They've approached this with a cooperative rather than a confrontational attitude. It wasn't always like this. Forty years ago they lied and said there was not a problem."

The most surprising conversion has been that of Ivan Weber, a Sierra Club activist who fought Kennecott on air quality for many years and then led the opposition to the damage settlement. Weber now works for a Kennecott contractor on the cleanup. When all the work is done, Weber hopes that the mine will be left in a "stable, environmentally acceptable state" and that wetlands will provide a long-term biological buffer for acid drainage.

"It's probably repugnant to a born-again environmentalist that nature can be taken apart and put together again," Weber says. "But we've inherited these mines that as a people we have to do something about. It's going to be expensive and difficult. I'm not trying to be an apologist. But the only hope for cleaning up this piece of earth is for Kennecott to clean it up."

Scott Endicott, who has taken up the Sierra Club's vigilance of Kennecott, remains skeptical. "This place is in for dealing with this for the rest of time," he says. "As long as people are still living in this valley, we will have to deal with that mine and the pollution it is causing. It's going to be expensive. But I don't think they have a choice. If they have to put all their profits into it, they ought to."

After all the technical, financial and legal details have been argued out, the debate over whether the EPA needs a Superfund listing to make Kennecott come clean finally comes down to a question of trust.

Kennecott has made great efforts to instill trust in the local community. It still has to prove itself to the EPA and probably in court.

EPA officials and Kennecott executives say they have been on the brink of an agreement again and again, only to have their lawyers keep them from signing. There are issues of substance involved, including the amount of financial assurance that Kennecott will provide for cleanup, and whether there will be any independent review of EPA decisions.

But both sides agree that the differences between a voluntary cleanup and a Superfund listing come down to legal arguments. In this respect, Bingham Canyon threatens to become typical of Superfund's problems rather than a model for solutions.

Chiaro says Kennecott's position has hardened since it has already been "smeared" by the listing proposal. He still hopes to reach an agreement with the EPA, but seems resigned to Superfund.

"A listing will not shut us down. It will make cleanup slower and cost more. But we'll get through it," he says. "This isn't a battle. We have the same goal."

This spring another season of cleanup construction and earth-moving is under way. Workers are capping old Kennecott tailings ponds in South Jordan, the last remaining source of groundwater contamination the company has to control.

The natural resource damage claim remains unsettled.

The EPA and Kennecott say they will try again to reach agreement in late May. If they can't, Kennecott will end up on the Superfund list. A final decision could come from the EPA as early as this summer.

Jon Christensen is Great Basin regional editor in Carson City, Nevada. This article was paid for by the High Country News Research Fund and by contributors to HCN's Great Basin Project.

The following sidebar article accompanies this feature story:

- The labyrinthine nature of mine waste regulations

For more information or to make comments on the EPA's proposal to put Kennecott on the Superfund national priorities list, contact Mike Holmes, EPA Region 8 community relations coordinator, 999 18th St., Ste. 500, Denver, CO 80202 (303/294-1141 or 800/227-8917 ext. 1141). The complete 4,250 page proposal can be read at the West Jordan City Hall and Magna City Library. Kennecott Corp. headquarters is at 10 East South Temple, P.O Box 11248, Salt Lake City, UT 84147 (801/322-7000).

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