The mining industry permitting process is taking an average of 7 years for new mines. SIRG has their permits, they came with the mine purchase but require updating and transferring.

Permits Drag on U.S. Mining Projects

With an Average Wait Time of Seven Years, Companies Look Elsewhere for Needed Metals, Minerals

By ROBERT GUY MATTHEWS

AP Photo

Despite having vast reserves, the U.S. remains a major importer of metals and minerals.

Obtaining the permits and approvals needed to build a mine in the U.S. takes an average of seven years, among the longest wait time in the world. So despite having vast underground stores of raw materials, the U.S. is one of the last places miners go to start a project.

At the proposed Kennecott Eagle nickel mine in Michigan's sparsely populated Upper Peninsula, the wait is at seven years and growing. Global miner Rio Tinto says the project would fill a raw-material gap in the U.S. economy, but the company has yet to produce an ounce of nickel there.

Last month, a state agency issued a final order making state water, air and mine permits effective, but Rio still needs a federal water permit. And the company expects challenges from environmental groups.

Overall, the U.S. is tied with Papua Guinea for the longest approval process among the 25 top mining countries in the world, according to Behre Dolbear Group, an international mining and mineral advisory group. In Australia, a huge mining center, the process takes an average of one to two years.

The length of the mine-approval process means that the U.S., while having the reserves as well as the market appetite for metals and minerals, remains one of the top importers of the materials from Australia, Brazil, Canada and Africa.

"We are becoming more and more dependent on metal imports in the U.S.," said Luke Popovich, spokesman for the National Mining Association, an industry group. Imports into the U.S. for selected metals—including gold, copper and zinc—rose 8.7% from 1998 to 2008, according to the U.S. Geological Survey.

The time frame in the U.S. isn't necessarily reflective of tougher laws. Australia and Canada have environmental laws for mine building that are on par with U.S. rules. But mine building often draws more opposition in the U.S. than in those countries. Part of that is due to mining's checkered history and reputation for pollution, abandonment and sometimes-shoddy management. Mining companies in the U.S., have cleaned up their management for the most part, but reputations haven't caught up.

Emily Bernhardt, ecologist and assistant professor at the biology department at Duke University, says a focus on the length of the permitting process in the U.S. is misplaced. "The length of time it takes for permitting is almost irrelevant because they are not always looking at the right issues," she said.

This month, Ms. Bernhardt co-authored a scientific paper calling on the Environmental Protection Agency and the Army Corps of Engineers to stay all new mountaintop mining permits. One issue is the permits focus on mainly local mining-site environmental impacts but don't take into account impacts far from the mine site, she said.

Minerals are critical to economies, as raw materials for power stations, bridges, cars, appliances and computers. They are limited by nature and can't be mass produced. Having a domestic source means lower distribution and shipping costs. And mines generate jobs and taxes.

But mines also permanently change a landscape and community with new roads, heavy equipment and traffic. Their impact on water sources is increasingly being scrutinized both in local communities and through regulation and court processes. Environmentalists, conservationists and some scientists are studying whether minerals leaching into water systems can harm water purity or cause health problems. Other concerns for underground mining include the creation of sinkholes, soil contamination, loss of biodiversity and erosion.

Mining companies contend that laws and processes in place mitigate most of these concerns. They also say that a balance has to be struck between leaving land untouched and providing needed materials. But most people simply don't want a mine near where they live.

"Folks say it is just a little mine, but it is a loss of a place that I find so compelling a reason to stand up for," said Cynthia Pryor, a spokesman for the Yellow Dog Watershed Preserve, dedicated to stopping the Michigan nickel mine. "There is timber and blueberry and hunting and all the things that are of value to a local community."

J. Murray Gillis, who teaches on mining issues at Michigan Technological University, says such concerns are often misplaced, noting that mining companies put up bond money to restore land.

"Mining companies have such great restrictions and everybody is watching them," he said.

Ms. Bernhardt, the ecologist, said mining companies, in general, have done what they have been asked to do but that the permitting process is flawed. "What the permits are allowing to happen, as in mitigating damage from mining, is not in fact mitigating damage," she said.

Seven years ago, Rio began working on developing the nickel reserve in the Upper Peninsula. It was considered ideal because it is concentrated in a relatively definable area. The 90-acre project anticipates 500 construction jobs and about 200 long-term jobs, both welcome in the Upper Peninsula, where unemployment stands at around 20%. The proposed mine is located underground, below a river bed.

Rio has obtained dozens of permits from several local, state and federal bodies that regulate water, air and pollution. Mining companies generally have to provide air- and water-quality samples, survey maps of potential water leaching, wastewater storage and plans for reclamation, such as reseeding of vegetation.

Rio says it will continue its efforts until the mine is opened. "Mining companies have to go where the minerals are," said a spokeswoman for Rio's Michigan project.

Write to Robert Guy Matthews at robertguy.matthews@wsj.com