By Rhiannon Hoyle 
 

The U.S. Department of Agriculture will withdraw a key environmental review for a planned Arizona mine that could supply up to a quarter of U.S. copper demand.

The Forest Service in January released a final environmental impact statement and draft record of decision for Rio Tinto PLC and BHP Group Ltd.'s Resolution Copper project in Superior, Ariz., that opened the door to a land exchange needed to develop what is one of the world's largest known, undeveloped copper deposits.

But the USDA on Monday directed the Forest Service to rescind those reports, saying more time was needed to fully understand concerns raised by tribes and the broader community about the project proposed on Oak Flat, a site sacred to local Native American communities.

"The Department is taking this step to provide an opportunity for the agency to conduct a thorough review based on significant input received from collaborators, partners, and the public since these documents were released," the USDA said.

Another round of consultations on the project could take several months, it said.

The reports were released on Jan. 15, days before the end of Donald Trump's presidency. Since taking office, President Joe Biden signed a presidential memorandum aimed at improving tribal consultation.

The Forest Service only has a limited capacity to protect Oak Flat because the land exchange was directed under the National Defense Authorization Act, the USDA said. "Long-term protection of the site will likely require an act of Congress," it said.

The U.S. government was expected to swap national forest land for eight parcels privately held throughout Arizona by the Resolution Copper joint venture within 60 days of the final environmental statement being published.

The land exchange is a necessary step for the companies to access areas above the deposit, although it has faced opposition from some Native American tribes for whom the land is used for spiritual and traditional customs. Engaging with tribal leaders on their concerns will test the miners' renewed focus on cultural heritage following Rio Tinto's destruction of two ancient rock shelters in Australia last year that triggered the removal of its CEO.

"Resolution Copper is evaluating the Forest Service's decision to rescind its final EIS and draft record of decision," a spokesman for Resolution Copper said in an emailed statement. "In the meantime, we will continue to engage in the process determined by the U.S. government and are committed to ongoing consultation with Native American Tribes and local communities."

Rio Tinto and BHP in 2013 started the permitting process for the Resolution copper deposit. The deposit sits well below the Earth's surface, up to 7,000 feet deep, and the companies project a mine there could produce as much as 40 billion pounds of copper over four decades.

"The mining industry stands ready to support the Biden administration's aggressive plans for electrification and modernizing our nation's electric grid--actions that will require massive amounts of copper and other mined materials--but it is imperative that our permitting processes proceed in a timely manner to support those goals," said National Mining Association President and Chief Executive Rich Nolan.

 

Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com

 

(END) Dow Jones Newswires

March 01, 2021 19:54 ET (00:54 GMT)

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