Time to improve permitting

We begin the new year in anticipation of positive things for mining in Nevada. It appears metal prices are recovering from their years-long slump and that the overall economy of the state, despite challenges from competition to our gaming industry, is looking up.

Exploration for minerals is more active than it has been for several years, and this holds the prospect that new discoveries will be made and mines developed and opened. Given this optimism, we should think about what can happen in this new, improved environment for mining in Nevada. The industry directly employed about 15,000 people in 1997. Today the number is under 10,000. Certainly mining has become more efficient and miners more productive, but job reductions have exacted a heavy toll on many miners, their families and our rural communities. It will take some time for the job count to return to higher levels, but with new mines and expansions at existing operations, it’s just a matter of time.

One of the greatest detriments to the business of mining is the time it takes to obtain the necessary permits. In the mid-1990s, it was reasonable to expect a relatively straightforward open-pit gold mine of oxide ore above the water table to be fully permitted in 18 months. Indeed, that’s the time it took Homestake to permit the Ruby Hill Mine in Eureka Cty. Today, that permitting time has expanded to roughly three years, and if there are complications with water, wildlife or appeals, the time frame can become considerably longer. For Nevada to remain competitive with other metal mining venues in the world, we need to make permitting more efficient. I don’t mean by cutting corners or doing a sub-standard job of analyzing and addressing environmental and social impacts of mining; I mean by finding opportunities to improve the efficiency in the process. That process involves our regulators, mining companies, and the public. I’m certain we can do a better job and reduce the amount of time it takes to obtain the permits required for mining.

With the resurgence in mining potential, brought on by better economics, now is the ideal time to address the permitting problem. The old saying that “time is money” is absolutely true: not only is there the increasing cost of a project as it is drawn out over years, but in mining there is significant risk that your commodity price will change, perhaps dramatically, by the time you begin production. It’s essential that permitting time frames be shaved if Nevada is to remain competitive.

We need to work with our regulators and the public during the new year to figure out why 18 months became three years and why three years has become five or more, and then figure out how to shorten that time frame. That is the goal.

— The preceding is from the January 2004 issue of The Nevada Miner, published by the Nevada Mining Association. The author is president of the NMA.