Mad_Mat wrote on Dec 18^th, 2009 at 2:20pm:

<snip>... supplies go up, prices and demand go down, and the mines get shut down and miners laid off.  The Molybdynum mine near Leadville is classic example for this - it'll be open for a few years, or a year, or a half year, then shut down for a year or years.

To be fair, the Leadville mine only produces one commodity: molybdenum. As with all commodities, the demand and price of molybdenum   (You need to Login or Register, but the irregularity and the scale of the fluctations is pretty wild. Which can explain why a mine that produces only molybdenum would experience such frequent and drastic changes.

The proposed PolyMet mine would produce several commodities (copper, nickel, cobalt, platinum, palladium, and gold), most of which are in fairly constant demand. The ability to produce several commodites can help soften the effects of market fluctuations, without constantly laying off production workers.



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Nickel may be important to national security - don't know, but my guess is if its mined in US, it'll wind up being shipped to China so they can make more Nicad batteries for us to buy back -- worth it ?

It is also worth mentioning how these metals would be sold. If my understanding is correct, the metals would be sold worldwide through a resource market based in Baar, Switzerland (Glencore AP). Just because the metals are mined here in the United States - by a Canadian-based company - doesn't make them "ours."



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what's wrong with "storing in place" those minerals in MN and buying the metal form other producers.

That's an excellent point. Like I was saying before, these deposits aren't going anywhere. If this mine doesn't open now, then it could be opened in the future, when other foreign sources begin to dry up. If we want to mine some of this deposit in the near(er) future, there are other options, some of which favor a less destructive and less risky underground mining operation.



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and last, but not least - I think there should be a total moratorium on all mining until they redo that 1890's mining law.  Mining should be similar to oil and gas exploration, where the landower - the government in this case (that's us) gets a 1/8th (or more) royalty - that is, 1/8th the value of the extracted mineral, right off the top.  Why should we continue to give this stuff away ?  If that royalty makes the project uneconomical for now, well good.  I want "my" share.

There's a bill floating around Congressional committees right now (Hardrock Mining and Reclamation Act of 2009), that would allow the government to impose a 2-5% royalty for all mining conducted on federal land. A similar bill failed in 2007. There are a lot of reasons why a gross royalty is a bad idea, but there are also a lot of good reasons for mining law reform. I'll leave that whole issue alone, for another time.

Minnesota does collect a royalty on all minerals extracted from state-managed lands. But the federal government does not have such a policy, and since the PolyMet mine would be on privately-owned land (after the proposed sale or transfer), I'm not sure any royalties would ever be collected.

However, the federal, state, and local governments could look forward to significant revenue in the form of various taxes and fees.