Tag Archives: Alan Lowenthal

On the Boundary Waters, Top Interior Department Lawyer Gets the Historical Record Wrong

Newspaper accounts and congressional testimony from 1966 suggest that Solicitor of the Interior Daniel Jorjani overlooked — or deliberately suppressed — critical evidence when he ruled, in 2017, that Antofagasta Plc had a right to renew its mineral leases near the Boundary Waters.

About a month ago, and just two days after his Senate confirmation as Solicitor of the Department of the Interior, Daniel Jorjani appeared before the House Natural Resources Committee to testify about his agency’s failure to cooperate with congressional oversight requests.  A highlight of that hearing came when Representative Alan Lowenthal pressed Jorjani about the renewal of mining leases near the Boundary Waters.  Jorjani was politically motivated, Lowenthal contended, and acted without regard for “history, law, and common sense.”

To help drive home the point, Lowenthal produced a 1966 Department of the Interior press release that directly contradicts one of the key legal arguments Jorjani made: that the terms of the original 1966 International Nickel Company leases “govern” the two leases currently held by Antofagasta, Plc, and — this is critical to his argument — that renewal of the leases was not conditioned on bringing the mine into production: “the historical record of the 1966 lease implementations,” Jorjani wrote, “show that production was not made a condition of renewal.”

In making this argument, which involves a tortured reading of renewal terms in Section 5 of the 1966 leases, Jorjani followed the lead of Antofagasta’s own legal counsel, Seth Waxman. Here, Waxman appears to have led Solicitor Jorjani astray. As Lowenthal points out, Jorjani is unable to account for the Department of the Interior’s own press release, issued the very day the leases were signed in 1966, which states unambiguously that the leases will be renewed “if the property is brought into production within the initial 20 year term.” What are we to make of this discrepancy? This is a question Lowenthal has been asking for two-and-a-half years.

In the exchange that follows, Jorjani says legal opinions about contracts are “not driven by press releases” and offers some evasive, time-wasting thank yous for the question, but he fails to put the matter to rest. Here’s video cued to the start of Lowenthal’s time.

News reports about the lease signing only serve to strengthen Lowenthal’s point. A June 15, 1966 Associated Press story by George Moses reproduces the language of the Department of the Interior press release. Here, for example, is a detail from the story as it ran in the Fergus Falls, MN Daily Journal:

The twenty year condition appears to have been an uncontroversial part of the agreement, unlike royalty rates, which took until November of 1966 to approve. On November 14, 1966, the Star Tribune could still say “the situation in regard to copper and nickel taxation is cloudy,” and an article in the Star Tribune on December 22, 1966 makes it clear the subject is still being debated into the winter; but there is no indication of controversy over the lease renewal terms.

In the June 15th Associated Press story, Henry Wingate, Chairman of International Nickel Company, “said he expects the property to be producing within a few years.” He and others at International Nickel were confident — too confident, as it turns out. In a July 13, 1966 story in the Minneapolis Star, published just about a month after the lease signing, Wingate’s second in command, John Page, predicted they’d be in production “in three years, if everything goes right.”

Wingate and other executives at International Nickel were confident they could bring the Minnesota leases into production within the space of a few years because they had successfully brought a much larger mining operation into production in just four and a half years. In that case, they also had to build a town to house 4,000 workers and their families. (That is how the boomtown of Thompson, in Manitoba, Canada, came to be built.) Twenty years would have seemed like a cakewalk. Others felt assured. When John G. Harlan Jr. of the General Services Administration testified before the Senate in 1967, his understanding was that International Nickel “plan to get into the production” in Minnesota by the early 70s.

Wingate, Page, and Harlan were about to be disappointed and see their confidence deflated. Right around the time International Nickel signed its Minnesota leases, the company’s fortunes took an unexpected turn. Competition stiffened, as other producers began bringing less expensive nickel oxides and ferroalloys into production. Nickel miners struck at International Nickel’s Sudbury mine. In 1966, the strikes were violent; in 1969, they were disruptive. The early 1970s brought recession. International Nickel’s stock tumbled, and Wingate’s successor,  L. Edward Grubb, made it his policy to curtail new development. Wingate would die in 1977 without seeing the Minnesota leases he’d signed a decade earlier come into production.

For Jorjani’s reading of the 1966 leases to prevail, we have to ignore all this history — the issuing of the press release and contemporary news reports, the company’s false projections of confidence, the bottom-line effects of work stoppages and labor strife, the economic stagnation of the early 1970s, and the decision at International Nickel to cut back on new development. Surely this is all part of the rich historical record, and even this cursory review shows exactly the opposite of what Solicitor Jorjani claims.

Read more about the Boundary Waters reversal here

 

“America is Not a Company”: Lowenthal Questions Nedd on the Boundary Waters

Nedd7Feb2017Email

“…documents that have already been released”: the February 2017 email from Michael Nedd that Representative Lowenthal used for today’s line of questioning.

One of the documents I obtained from the Department of Interior through a Freedom of Information Act Request came up for discussion at this morning’s Energy and Mineral Resources Subcommittee Hearing.

Representative Alan Lowenthal of California kicked off the question and answer period by asking Michael Nedd of the Bureau of Land Management when he first discussed the issues of the Twin Metals mineral leases in Superior National Forest with the incoming administration. Nedd was evasive (as he was throughout the entire hearing, prompting Representative Jared Huffman to remind him, at one point, that he is “not a potted plant”).

A second question from Lowenthal: “do you recall who from the incoming Trump administration first discussed the issue with you?” got an equally vague reply: Nedd said he did not have “a specific recollection.” So Lowenthal offered a reminder:

Well from documents that have already been released, we know that in early February of 2017, you sent out a briefing memo on this topic, which was entitled “Withdrawal Options.”

As the timeline shows, this email is — so far — the first time the Twin Metals matter is raised at Interior after the new administration takes office. It indicates that Nedd was following up on a discussion he had with staff either that day or before that day; and it raises the question why this matter appears to have been a Trump administration priority. Nedd wanted an updated briefing paper, pronto, by close of business on Thursday, February 9th. Why was this matter top of mind for him? Why the quick turnaround? Why the urgency?

Blumenthal also asked for a copy of the original briefing paper Nedd attached, and Nedd was agreeable but non-committal, saying he would take Blumenthal’s request back to the Department of the Interior. We already know that just a few months later, by late April of 2017, this briefing paper would have undergone enough revision so that the Karen Hawbecker could refer to “options we’ve identified for reversing action on the Twin Metals decision.” So that tells us what we need to know about the direction Nedd gave the group for “working together.” They were to reverse what the previous administration had done.

At whose direction? And why? We still don’t have satisfactory answers to these questions.

Here is Lowenthal’s first round of questioning on the Boundary Waters reversal, which includes his exchange with Nedd over his Briefing Paper. (The video here is cued to the start of his question.)

Later in the hearing, at around 1:26, Lowenthal questions Chris French of the US Forest Service on Secretary Perdue’s cancellation of the environmental assessment in Superior National Forest and about the false assurances Perdue gave Representative McCollum, and asks that French provide relevant documents. After that there is some back and forth with Representative Gosar, who complains of executive overreach by the Obama administration, claims the people of Minnesota want these mineral leases renewed, ends by arguing that polling questions can be misleading, and if we had polled people properly back in 1919, we wouldn’t have a Grand Canyon National Park today. I’m not exactly sure how that last argument is supposed to win the day at a hearing on public lands.

For his part, Lowenthal has a strong sense of what’s at stake throughout this hearing. Just consider this excerpt from his opening statement on the Trump doctrine of “energy dominance” that now informs policy at the Department of Interior:

America is not a company. It may seem like President Trump is trying to treat us like one, like many of his other companies, and let us run it into the ground. But America is a country, not a company, and America’s lands are not excess inventory that need to be disposed of. Our natural resources are not reserves that need to be booked, so our stock prices stay high and our investors stay happy. Our public lands are an investment that we’re holding for our grandchildren, and their grandchildren, and generations beyond. They’re an investment that pays off, by allowing them to know, our grandchildren, great grandchildren, what vast stretches of untainted wilderness look like. That lets them see with their own eyes polar bears, sage grouse, mule deer, and caribou, running wild and free. That lets them learn about ancient native cultures without having to go to a museum, and lets some cultures continue to observe and respect the same traditions that their ancestors have. These are all priceless. They’re irreplaceable. And these are all infinitely more important than whatever extra few dollars can line an oil baron’s pocket over the next few years. I just hope our land management agencies still understand that.