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Mine, Environmentalists Hail ID Cobalt Mine Deal by Todd Dvorak, Associated Press The Seattle Times, August 18, 2008

Environmentalists, a former governor and officials from a company planning to mine cobalt from the belly of a central Idaho mountain joined forces Monday to praise a deal they say guarantees long-term protection of the environment.

BOISE, Idaho — Environmentalists, a former governor and officials from a company planning to mine cobalt from the belly of a central Idaho mountain joined forces Monday to praise a deal they say guarantees long-term protection of the environment.

The agreement emerged during a series of talks over the Idaho Cobalt Project, a mine proposed 22 miles west of Salmon in the Challis National Forest and adjacent to a historic mine blamed decades ago for killing salmon runs along a tributary of the Salmon River.

The U.S. Forest Service approved the project with conditions in June, clearing the way for Formation Capital Corp. to open the nation's first cobalt mine in decades.

But it was separate discussions with environmentalists that produced the kind of concessions that could help the company avoid the long, costly legal battles that stymie so many mining proposals across the West.

For example, the Idaho Conservation League points to financial and legally binding commitments by the company to pay for water monitoring or treatment long after the mine plays out. The company has also pledged to contribute $150,000 annually through the life of the mine for restoration projects in the Upper Salmon watershed.

In return, the Idaho Conservation League, the state's biggest environmental group, has promised not to fight the mine in the courts, opting instead to appear at a news conference side-by-side with mining officials touting the benefits of extracting high quality cobalt from the Yellowjacket Mountains.

"The company has said it's important that we are different from a historic mining company," former Democratic Gov. Cecil Andrus said during Monday's news conference in Boise.

Andrus, who is also a board member of Formation Capital and a member of the Conservation League, said the agreement should serve as a blueprint for future mining ventures in the state and proof that traditional foes - environmentalists and mining executives - have more to gain by meeting at the bargaining table than a federal courthouse.

"The best way to protect Idaho's environment and values is to work with companies instead of having an adversarial relationship," said Rick Johnson, the Conservation League's executive director. "They said they were serious about being good neighbors here."

The company must still win final federal approval and obtain a handful of permits from the local government. But Preston Rufe, the company's environmental manager, said construction on a new tunnel and operations buildings could begin later this fall.

Once operational, the company anticipates mining as much as 1,600 tons of high purity cobalt per year, employing as many as 200 workers and pumping more than $15 million annually into the state and local economy through salaries and taxes.

Cobalt, which has a high melting point, is a valuable component in the production of fighter jet engines, radar equipment, gas turbines and batteries for hybrid cars.

Johnson said those strategic and ecological uses played a factor in the conservation group's decision to work with the company, as did the company's plans to mine underground in an area already badly blemished by past mining activity.

"It's not as if this is a big open pit gold mine," Johnson said.

But the Conservation League also credits the company's concern about the environmental welfare of the region long after the operation shuts down.

Federal rules require miners to post bonds to ensure some level of water quality monitoring and treatment, but often the amount posted falls far short of what those costs could be.

In early negotiations, the U.S. Forest Service asked for a $43 million bond, an amount the company, which has spent about $35 million on exploring and developing its proposal, ultimately agreed to post during negotiations, environmental officials said. The company has also pledged to build a treatment facility if pollution becomes an issue even after mining ceases at the site.

"They were willing to bond for water treatment into perpetuity," said John Robison, public lands director for the Conservation League. "In the past we've said no, but with this case we will be able to point out ... the things they're doing are right."