JurisdictionUnited States
Water-Energy Nexus: Acquisition, Use, and Disposal of Water for Energy and Mineral Development
(Sep 2012)


Brian R. Hanson
Baird Hanson LLP
Boulder, Colorado

BRIAN R. HANSON is a partner of Baird Hanson LLP, and is based in Boulder, Colorado. Mr. Hanson serves a broad range of clients addressing complex environmental regulatory challenges. Since 1981, he has practiced natural resources and environmental law by assisting mining and industrial project due diligence and permitting; overseeing and coordinating company responses to compliance investigations; negotiating on behalf of companies with federal, state, and local regulatory agencies; and developing strategies for working with nongovernmental entities. Mr. Hanson has substantial experience with the National Environmental Policy Act; Clean Water Act; Resource Conservation and Recovery Act, Comprehensive Environmental Response, Compensation and Liability Act; and Endangered Species Act. From 1995 to 1997, he served as the Executive Director of The Land and Water Fund of the Rockies, a legal service organization advocating for preservation of the Rocky Mountain and Desert Southwest region. Prior to working with The Land and Water Fund, Mr. Hanson was a partner with Holland & Hart LLP. Mr. Hanson graduated from the University of Colorado School of Law in 1981. He received his Bachelor of Arts degree from the University of Wisconsin/Madison in 1978, Phi Beta Kappa. He served as the Chair of the American Bar Association's Endangered Species Committee and as Vice-Chair of the Water Quality and Wetlands Committee. Mr. Hanson works closely with the Northwest Mining Association. Mr. Hanson is a member of the Colorado and Idaho Bar Associations.

Water quality management issues in development of non-energy mineral resources arise in a number of contexts, including, for example, discharge or fill permits, injection control, and reporting/enforcement. Each applicable context requires analysis and, as necessary, development of detailed implementation strategies.

This paper offers a guide to scoping potential water quality issues to assist mineral resource developers in identifying and implementing water quality management strategies.

Water quality issues create the largest complex of problems at mine sites. Managing water quality is expensive, relentless, and, when done poorly, potentially fatal to the project goals. Mismanagement of air emissions, waste management, land use, or permits often fails to excite the public. Contaminated water, impacts on fisheries, unplanned releases or flows, destruction of wetlands, pit lakes, and other water quality issues garner attention quickly. Proper identification and anticipation of water quality issues is not difficult. But it needs to be done before one finds oneself in violation of the law of gravity.

1. Overview

The primary federal water quality statutes are the Clean Water Act and the Safe Drinking Water Act. The primary federal implementing agencies are the Environmental Protection Agency and the Corps of Engineers. Federal land management agencies, such as the Bureau of Land Management and Forest Service also impose water quality requirements as part of the Notice or Plan regulatory processes.

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State, county, and local entities also may impose water quality mandates on mineral resource operations. Some of these mandates may be based on water quality programs delegated by the federal agencies or certifications required under federal law. However, a critical trend in mining regulation is the increasingly aggressive independent attempt by state, county, and local authorities to regulate mining. For example, for all the battles about delineating "waters of the United States," few limitations exist on states' authorities over "waters of the State," which might include artificially created ponds, ground water, dry tributaries, and other waters not subject to federal jurisdiction. Project proponents should ensure that non-federal authorities and limitations are anticipated and understood.

Enforcement based on notions that a mine has violated water quality requirements is a threat during the life of the mine. Sanctions can be serious. For example, under the federal Clean Water Act, civil penalties can be sought if violations of the Act are found. Section 1319(d) states that any person who violates the Act "shall be subject to a civil penalty not to exceed $25,000 per day." The maximum daily penalty has increased periodically; it is currently set at $37,500.00. 40 C.F.R. § 19.4 . Courts have held that penalties are mandatory if a violation of the Act is found. See Natural Resources Defense Council v. Sw. Marine, Inc., 236 F.3d 985, 1001 (9th Cir. 2000). Injunctive relief and criminal sanctions under the Act also are possible. (For a good recitation of Clean Water Act enforcement calculations made in a mining context, see Idaho Conservation League v. Atlanta Gold Corporation. 2012 WL 2944247 (D. Id. July 19, 2012).

This scoping guide begins with the primary federal water quality statutes and then discusses water quality issues associated with (1) access and exploration, (2) operations, and (3) reclamation and closure.

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1.1. Clean Water Act
1.1.1. Section 402: National Pollutant Discharge Elimination System

The Clean Water Act (CWA) was enacted "to restore and maintain the chemical, physical, and biological integrity of the Nation's waters." 33 U.S.C. § 1251(a). To achieve this goal, the CWA, among other objectives, sought the elimination of "discharge[s] of pollutants into the navigable waters." Id. CWA Section 301 seeks to achieve this goal by making unlawful "the discharge of any pollutant by any person" except in compliance with specified statutory provisions. 33 U.S.C. § 1311(a). The two most significant provisions are Sections 402 (the national pollutant discharge elimination system) and 404 (discharge of dredged or fill materials).

Section 402 "prohibits the 'discharge of any pollutant' into navigable waters from any 'point source' without a permit." See Committee To Save Mokelumne River v. East Bay Municipal Utility District, 13 F.3d 305 (9th Cir. 1993) (quoting 33 U.S.C. § 1311(a) (abandoned copper/zinc mine facility drainage is subject to CWA). Permits issued pursuant to the National Pollutant Discharge Elimination System ("NPDES") program allow "discharge of any pollutant, or any combination of pollutants," on condition that the discharge meets other sections of the Act. 33 U.S.C. § 1342(a)(1). "Discharge" of a pollutant or pollutants means any addition of any pollutant to navigable waters from any point source. Id. at §1362(12). Pollutants include industrial, municipal, and agricultural wastes discharged into water. Id. at §1362(6). A point source is "any discernible, confined and discrete conveyance" from which pollutants are or may be discharged. Id. at §1362(14). Navigable waters are broadly defined as any "waters of the United States." Id. at §1362(7). Implementing agencies try to extend these jurisdictional terms beyond the already broad judicial interpretations.

Section 402 NPDES authority is now nearly entirely delegated to states, which issue permits under EPA oversight. State programs often intermingle federal and state

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authorities, which compels the regulated community to examine closely the basis for mandates or enforcement.

1.1.2. Section 404: Discharge of Fill

Clean Water Act Section 404 authorizes the Corps of Engineers to issue permits for the discharge of dredged or fill material into navigable waters. 33 U.S.C. § 1344(a). The Corps' implementing regulations are at 33 C.F.R. Parts 320-330. Discharge of "dredged" or "fill" material into "navigable waters" without a permit is prohibited. Each of the operative terms is broadly defined. EPA and the Corps include "wetlands" among waters regulated by Section 404.

EPA asserts authority over Clean Water Act implementation. See 43 Op. Att'y Gen. No. 15 (1979). Section 404(c) authorizes EPA to "veto" areas for use as disposal sites for dredged or fill material. While veto authority has been used rarely, it provides EPA with an important weapon to compel the permit applicant to follow EPA preferences. Recently, EPA tried, nearly three years after permit issuance, to veto a permit issued for the Spruce No. 1 coal mine. See Mingo Logan Coal Company v. EPA. 2012 WL 975880 (D. D.C. March 23, 2012). The Court rebuffed EPA's efforts. EPA has now threatened to use its veto authority against the Pebble Mine.

1.1.3. Section 401 Water Quality Certification

Clean Water Act Section 401, 33 U.S.C. § 1341, requires states to review NPDES or a Section 404 permits to ensure that the activity will comply with State water quality standards. (A similar process is applicable to general permits when they are issued, which allows a general permittee to not have to seek a separate Section 401 certification before using any particular general permit). If the State determines that the proposed activity will comply with State water quality standards, the State then must certify that the permitted activity meets those standards. This certification is a precondition to Clean Water Act permit issuance.

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1.2. Safe Drinking Water Act

The SDWA was enacted in 1974 to protect public health by regulating the nation's public drinking water supply. The SDWA is best known for authorizing EPA to set national health-based standards for drinking water to protect against both naturally-occurring and man-made contaminants that may be found in drinking water. See 42 U.S.C. § 300g-1. Initially, the SDWA focused on treatment as the primary means of ensuring safe drinking water at the tap. However, beginning in 1986, the SDWA required actions to protect drinking water and its sources, such as rivers, lakes, reservoirs, springs, and ground water wells. The...

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