EDITOR: | August 8th, 2013 | 11 Comments

It’s August. Do you know where your Federal Regulators Are?

| August 08, 2013 | 11 Comments
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It’s August in Washington, the perfect time for the federal government to drop surprise policy pronouncements on a public (rightly) focused on squeezing in one last beach weekend before back-to-school shopping.   Adept government agencies can slot a few paragraphs into the Federal Register that will dictate federal policy for decades without a ripple in the pond of public indifference.

Case in point:  The U.S. Bureau of Land Management’s decision to close off land in six states – 303,900 acres in all, in California, Arizona, Colorado, Nevada, New Mexico and Utah – for mineral exploration over the next 20 years, that being the maximum in federal-sentencing under Department of Interior rules.

What can happen in 20 years’ time?  Let’s look backward to answer that question.  20 years ago, in August 1993, a business journal featured an article exploring the “Business Justification of E-Mail,” concluding that most companies would find email “necessary.”  The first smart phone was introduced (Tech Trivia:  Simon, by IBM).  There were no iPods, iPad, iPhones – no iAnything.  There were stories marking the first 10 million cell phone users (there are 6 billion cells in use today).

Along the way, manufacturers of those devices learned the necessity of arcane elements like Dysprosium and Neodymium, Tantalum and Tellurium and another dozen or more.

Where will the next 20 years take us?  As the last 20 make clear, we have no idea.  Even at the slowed-down pace of Moore’s Law – with computing capacity taking 3 years to double, not 18 months, 20 years is more than 6 “Moore Cycles.”   Whatever we’re doing now with a hand-held or laptop, we’ll be doing 64 times faster in 2033.

What metals and minerals will power these new advances?  In what alloys and what quantities?  Once more, we don’t know.  But thanks to the BLM, we do know that these metals won’t be mined in their 6-state “no dig zone.”  So the U.S. will simply import these metals from elsewhere – or, more likely, the products of 2033 will likely be built elsewhere, where the metals are — and sold to us.  Can you say “negative balance of trade?”  “Reduced competitiveness?”  “Outsourced jobs?”  “Lower GDP and higher federal debt?”  Hardly the kind of future our political class promises us.

But it’s August.  Who’s watching?

Anti-mining pressure groups, for one.  The National Wildlife Federation, Trout Unlimited and the Theodore Roosevelt Conservation Partnership are all officially delighted with the BLM ban.  (Historical note:  When dealing with the critical mineral of his day – coal – Teddy Roosevelt threatened to end a coal strike by sending in federal troops to man the mines.  So the storied conservationist and lover of the West was also a realist on matters of critical minerals and the need to mine them.)

Then there’s the irony in the BLM’s justification for its action.  The rationale, as filed in the Federal Register: The BLM’s mining ban is meant “to protect 17 Solar Energy Zones…for future energy development.”  By banning mining, these acres will be set aside for solar power farms.  Where will we get the copper, indium, gallium and selenium essential to next-generation photovoltaic arrays to turn Sun into power?  Don’t ask the BLM.

But as the saying goes, “Act Local, Think Global.”  Out in the wider world, our ban is good news for miners in China and DRC Congo and from Angola to Zambia who will mine whatever metals we don’t – so that someone, somewhere will fabricate them into the solar panels of the future.

But again, it’s August.  Who’s watching?


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Comments

  • Tracy Weslosky

    It is with distinct pleasure that I welcome one of my favorite writers in the rare earth and critical minerals sector to InvestorIntel. Dan’s work on the issues of sustainability for America and on behalf of the companies seeking to produce in North America should be applauded.

    August 8, 2013 - 12:49 PM

    • tek

      Mr. McGroarty’s name is misspelled in the byline. (McGroaty)

      August 9, 2013 - 11:00 AM

  • Gareth Hatch

    Thought-provoking piece, Dan – welcome aboard 🙂

    August 8, 2013 - 12:56 PM

  • Jim S.

    Good article Dan. Indeed we often find regulatory process happening in the summer months when most Americans aren’t looking. Thanks for this article, let’s hope it opens some eyes!

    August 8, 2013 - 2:26 PM

  • tek

    Did I miss the part where the “303,900 acres in all, in California, Arizona, Colorado, Nevada, New Mexico and Utah ” had exploratory assessments done for “the copper, indium, gallium and selenium essential to next-generation photovoltaic arrays to turn Sun into power” ?

    I would have preferred to have had a clear, scientific analysis of the properties’ value of these materials in situ to justify the rather backhanded slap at the environmental movement. In fact, “The Bureau of Land Management manages more surface land – approximately 245 million acres – than any other Federal agency. These surface lands are located primarily in the West, but the bureau has a national presence with responsibilities for some 700 million acres of sub-surface mineral estate underlying both Federal and non-Federal lands .(BLM Mining site data) ” I think we can spare 300 thousand acres that are not of national security interests for twenty years. If it turns out that such properties are of such significant mineral value to warrant review, then I’m sure it would be done. If you have such information please present it.
    So please, stop screaming before you’re burned.

    August 8, 2013 - 2:47 PM

  • Calling all Potash Investors: Panic presents buying opportunities | InvestorIntelInvestorIntel

    […] What can I say, I like this story. And I am not the only one, as Yara was impressed last summer when it invested $40 million in Himmel’s company. Clearly many have invested in a vision towards building a successful, highly lucrative mining company and single-handedly making the U.S. self sufficient in SOP…and we are all supporters here of sustainability initiatives. […]

    August 8, 2013 - 3:16 PM

  • GoBucks

    Tek, surely you jest.

    “If it turns out that such properties are of such significant mineral value to warrant review, then I’m sure it would be done. ”

    Come on.

    No reviews will be done. No “scientific” studies will be done. Not even if you tried to pay for it out of your own vast resources.

    Why?

    Because the answer is “No. Don’t even ask.”

    You inadvertently made a good point, though. The BLM does (mis)manage a vast amount of land. Perhaps their ‘portfolio’ should be trimmed a bit. One good way to cut our staggering debt would be to sell some land. Or at least open it for responsible prospecting and mining.

    Thanks, BLM. I hope someday to return the favor!!

    August 8, 2013 - 4:02 PM

  • Daniel McGroarty

    Many thanks for the comments, pro and con. My point, in contrast to the comment that these particular lands “are not of national security interest,” is that we don’t know this today and will now be locked into our not-knowing for 20 years, regardless of advances in minerals exploration. I hear a lot in Washington about making policy based on sound science; federally enforced not-knowing seems the antithesis of that.

    My thanks to InvestorIntel for providing a platform for discussion and debate.
    Daniel McGroarty

    August 9, 2013 - 7:22 AM

  • tek

    Please note that the decisions made on these locales were done so at the end of a SIX YEAR LONG study, beginning in 2007, which included many opportunities for public comment from private and public and local concerns. This also included environmental assessments and other business/economic projections, including MINING, focusing on the growing demand for solar farms. And rather than wait for the private investments to acquire these lands for future development, (the RE industry knows this well) the BLM took the proactive measure of accomplishing all the preliminary work. They have therefor provided the initial work for designating Solar Energy Zones for private business development where none existed before.
    The following website provides interactive panoramic views of all the sites that were selected. Please note that some of the properties already have dedicated right-of-ways for power lines as evidenced by existing facilities through these flat, hot, desert lands.

    http://www.solareis.anl.gov/sez/panoramas/index.cfm

    Seems like a good idea to me.

    August 9, 2013 - 9:43 AM

  • tek

    I left this one out, but it should give you an idea of the extensive process undergone:

    http://www.blm.gov/wo/st/en/prog/energy/solar_energy.html

    August 9, 2013 - 9:55 AM

  • GoBucks

    Six years? They sure milked that one for all it was worth. And they got it wrong anyway.
    Typical government.

    August 9, 2013 - 12:40 PM

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