Chapter 4B Why We Need Mining and Mining Lawyers in the U.S.

• Jurisdiction: United States

Chapter 4B Why We Need Mining and Mining Lawyers in the U.S.
Ramona Monroe¹ Stoel Rives, LLP Anchorage, AK

RAMONA MONROE is a Partner with Stoel Rives LLP in the Anchorage office. Her practice focuses on matters related to Alaska's vast wealth of land and minerals. She represents natural resource companies in transactions, financing, and compliance with state and local government requirements. She has significant experience in preparing both oil and gas, and mineral title opinions. Ramona led the Alaska Miners Association's successful efforts to amend Alaska's mineral tenure statutes in 2020. Ramona is active in the Foundation for Natural Resources and Energy Law, serving on the Program Committee and formerly a trustee-at-large (2016-2018). She was awarded the Advocate of the Year by the Alaska Miners Association in 2018. She has been included in The Best Lawyers in America" (currently: Oil & Gas Law), 2018-2022.

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I. Lessons From the Past

As an international studies major in college, I asked myself why some countries are rich while others are poor. I had lived in both: I grew up in western Washington and spent one year of high school as an exchange student in Bogotá, Colombia. I do not recall my international studies classes asking or addressing why some parts of the world developed more quickly than others. Drawing on my own experience, I reflected on this question for some time.

Despite living in an upper-class area of Bogotá, we sometimes had rolling blackouts. These were not scheduled and we did not know in advance which evenings our neighborhood would be the one with no lights. The blackouts were imposed by the government because the supply of electricity was not sufficient to meet the demand. This was in a city where the average year-round temperature was 65° F and homes had neither heating nor air conditioning. The peak demand was in the evening when everyone turned on the lights.

It was also the early-to-mid 1980s. Gas prices and inflation were soaring, interest rates were 14% or more, and the news was dominated by tensions in the Middle East that were threatening our economy due to our dependence on foreign oil. The U.S. had created the Strategic Petroleum Reserve a decade earlier in response to the OPEC oil embargo. A few years later, war in Iran caused a precipitous drop in global oil supplies and a corresponding price spike. Every American with a car was impacted. The implications of dependence on foreign oil and how to address it drew national attention.

I concluded that what really differentiates life in the United States from life in Colombia and other third world nations is the availability of affordable, reliable energy. When those energy supplies were threatened, it created great upheaval in the U.S. When those energy supplies didn't exist, it prevented Colombia from developing at the same rate as the U.S.

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Twenty-five years later, in 2005, Congress continued to debate what to do about our dependence on foreign oil.² Just 10 years later, Congress repealed the ban on exporting U.S. crude oil.³ What changed in the oil and gas industry? In large part, technology and innovation brought us directional drilling techniques and hydraulic fracturing.⁴ As a result of these advancements, the U.S. was able to unlock vast quantities of domestic crude and become a net exporter of crude oil.

The U.S. mining industry is, in many ways, in the same position as the oil and gas industry forty years ago. Let's use rare earths as an example. The Mountain Pass Mine in California is one of the richest deposits of rare earth elements in the world. From the 1960's through the 1980's, the U.S. was the largest producer of rare earths minerals for high-performance magnets needed for clean technology.⁵ The mine closed in 2002. Two things happened: (i) the U.S. prioritized environmental protection, and (ii) economic globalization allowed Chinese suppliers with little to no environmental restrictions to become the cheapest global source.

As the cost of production in the U.S. increased, mines closed. By 2010, the U.S. had no rare earths production and the Mountain Pass Mine in California lay dormant. Mountain Pass reopened in 2012 but price declines driven by Chinese supplies forced the operator into bankruptcy. The mine eventually resumed operations with produced concentrates exported for separation and processing because there were no domestic processing facilities available.⁶

The lack of U.S. mineral production is not because we cannot find mineral deposits or because we lack the know-how to extract and process them. The primary impediment to U.S. mining today is regulatory hurdles and permitting timeframes.⁷ Competing and conflicting interests in the U.S. between supply chain and environmental protection make it hard to develop, adopt, and implement a meaningful national strategy to break our dependence on foreign minerals.

II. The Mining Renaissance

The U.S. government and the public are becoming more and more aware of and focused on the risks of dependence on foreign minerals. There is building momentum to address this issue as shown by the following chronology of agency reports and actions:

Year	Action
2010	Interagency Working Group on Critical and Strategic Mineral Supply Chains formed
	Subcommittee on Critical and Strategic Mineral Supply Chains created

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	Chinese embargo of rare earth elements to Japan
	DOE issued its Critical Minerals Strategy
2011	DOE updated its Critical Mineral Strategy
2015	SNL Metals & Mining prepared Permitting, Economic Value and Mining in the United States report for the National Mining Association
	DOE releases Quadrennial Technology Review
2017	EO 13817 - defined critical mineral: • Essential to economic and national security • From a supply chain vulnerable to disruption • Serves an essential function in a product, the absence of which would have substantial consequences for the U.S. economy or national security
2018	Critical Minerals List - 33 minerals and 2 mineral groups (rare earth elements and platinum group metals
2019	Subcommittee on Critical Minerals (from 2010) prepared A Federal Strategy to Ensure Secure and Reliable Supplies of Critical Minerals released by Department of...