Minnesota Supreme Court hands victory to PolyMet copper mine

In this Feb. 10, 2016, file photo is a former iron ore processing plant near Hoyt Lakes, Minn., that would become part of a proposed PolyMet copper-nickel mine. Lawyers for the proposed PolyMet copper-nickel mine and state regulators urged the Minnesota Supreme Court on Tuesday, Oct. 13, 2020, to defer to the judgement of the state Department of Natural Resources and reinstate three critical permits for the project. (AP Photo/Jim Mone, File)

MINNEAPOLIS (AP) — The Minnesota Supreme Court on Wednesday reversed an appeals court's rejection of a critical air emissions permit for the planned PolyMet copper-nickel mine and sent the case back for further proceedings.

The Supreme Court ruled that the Minnesota Pollution Control Agency was not required under federal law to investigate allegations by environmental groups and a Native American tribe of "sham permitting."

PolyMet and the state agency took the case to the state's highest court after the Minnesota Court of Appeals last March sent the air permit for the $1 billion mine back to the regulators for further review. The appeals court said the agency had not adequately evaluated whether the air permit understated the company's real plans. That court took note of securities filings indicating that PolyMet was considering expanding the mine to four times the size that the air permit would allow, but that would require a new permitting process.

The Supreme Court sent the case back to the Court of Appeals to consider whether the agency correctly concluded that PolyMet would comply with all terms of the permit, and whether PolyMet had failed to fully disclose all relevant facts or submitted false or misleading information to the agency.

The open pit mine and processing plant near Babbitt and Hoyt Lakes would be Minnesota's first copper-nickel mine. Environmentalists have fought the project because of the potential for acid mine drainage upstream from Lake Superior. The opponents are a coalition of groups led by the Minnesota Center for Environmental Advocacy plus the Fond du Lac Band of Lake Superior Chippewa.

Although the ruling was at least a partial defeat for the mine opponents, the Minnesota Center for Environmental Advocacy and others welcomed the remand order as a chance to continue pressing the argument that PolyMet hasn't been straight about its plans.

“Today’s ruling underscores that the entire process by which PolyMet obtained its permits in 2018 may have been deceptive and allows us to make this case to the Minnesota Court of Appeals,” Kathryn Hoffman the group's chief executive, said in a statement. “PolyMet has engaged in a bait-and-switch scheme to avoid air pollution standards, and we are glad that the Supreme Court ruling allows us to make this case.”

But PolyMet, whose majority shareholder is Swiss commodities giant Glencore, expressed confidence that it would prevail.

“We believe strongly that the facts and the law are on our side, and we are pleased that the court agreed with us on the law,” CEO Jon Cherry said in a statement.

PolyMet still has several other legal hurdles to clear before it can begin mining. A ruling from the Minnesota Supreme Court on the appeals court's decision to cancel PolyMet's permit to mine and dam safety permits remains pending. PolyMet’s water quality permit is on hold at the appeals court. And arguments are expected this summer in federal court on challenges to the company's wetlands permit from the Army Corps of Engineers.

PolyMet is far more advanced in the permitting process than another proposed copper-nickel mine for northeastern Minnesota, Twin Metals near Ely, which is owned by the Chilean mining group Antofagasta. Twin Metals would be be built in a different watershed, one that flows into the pristine federal Boundary Waters Canoe Area Wilderness. The Trump administration revived that project after the Obama administration tried to kill it because of environmental risks.

A key figure in the Obama administration's decision on Twin Metals was Agriculture Secretary Tom Vilsack, who was confirmed for a second stint Tuesday. His agency oversees the U.S. Forest Service, which oversees the Boundary Waters. Environmentalists are now hoping the Biden administration will block Twin Metals again and are also challenging it in court.