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IG finds no evidence

Pebble says EPA watchdog's findings belie record of bias, predetermination

After 17 months of investigation, the U.S. Environmental Protection Agency Office of Inspector General said it could find no evidence that the federal agency was unfair while conducting an assessment of the Bristol Bay Watershed. The conclusion, however, runs counter to those of others who have reviewed the case.

The EPA's Bristol Bay Watershed Assessment is a study of the potential risks large-scale mining might pose to the abundant fish resources in the Bristol Bay region of Southwest Alaska.

"Based on available information, we found no evidence of bias in how the EPA conducted its assessment of the Bristol Bay watershed, or that the EPA predetermined the assessment outcome," the IG office penned in the 30-page report.

Pebble Partnership CEO Tom Collier said the findings sharply contrast with the reams of evidence that the State of Alaska, his company and others provided to the watchdog.

"I have never seen an IG report that I thought was as poorly done as this one," the longtime Washington D.C. insider told Mining News Jan. 18.

The publication of the brief report by the EPA's internal investigative body sets the stage for arguments in an ongoing federal trial as well as continued U.S. Congressional committee probes into the EPA's potentially illegal activities.

No bias found?

Though EPA IG office said it found "no evidence of bias or predetermination" in the EPA's conduct, a number of documents uncovered by the U.S. House Oversight and Government Reform Committee and turned over to the inspector general prior to its investigation appeared to show that at least some upper level officials in the EPA had decided as early as 2010 that development of a mine at Pebble needed to be stopped and was looking for the best avenue to achieve this goal.

One such document brought to light by the House watchdog is a December 2010 request for funds to "initiate the process and publish a CWA 404(c) 'veto' action for the proposed permit for the Pebble gold mine in Bristol Bay."

In making the request for 2011 funds, the EPA Office of Water budget wrote: "While resorting to exercising EPA's 404(c) authority is rare (only 12 actions since 1981), the Bristol Bay case represents a clear and important need to do so given the nature and extent of the adverse impacts coupled with the immense quality and vulnerability of the fisheries resource."

Of the thousands of pages of documents handed over to the EPA Inspector General Office, this is one of only a handful referred to in the report. The watchdog, however, said this is evidence that though EPA staff were discussing the potential of initiating a Section 404(c) review of Pebble, it does not demonstrate that a conclusion to this process had yet been determined.

"There were EPA staff and managers who were considering a CWA Section 404(c) process prior to the EPA's official announcement to conduct the assessment, but we did not uncover any evidence of a predetermined outcome in any of the documents or emails we reviewed or interviews we conducted," according to the report.

An internal EPA worksheet listing the pros and cons of a pre-emptive CWA Section 404(c) review of Pebble versus letting the project go into permitting, however, seems to show that upper level EPA officials were discussing the best way to stop development of the enormous copper project using this process.

The top drawback listed in the con column of this 2010 "discussion matrix" was that a proactive 404(c) determination had "never been done before in the history of the CWA."

The agency listed political backlash and litigation risks as other potential negative outcomes of attempting to use 404(c) to stop Pebble prior to permitting. The document suggests that some form of public process would help deflect some of this backlash, which is the route the agency ultimately took in the form of the Bristol Bay Watershed Assessment.

The document also said that a pre-emptive 404(c) decision at Pebble could serve "as a model of proactive watershed planning for sustainability."

Pebble CEO Collier said this statement sheds some light into EPA's motivation.

"They want to zone watersheds," he explained.

North acted alone?

One thing that the Pebble Partnership and the EPA Inspector General agree on is that Phil North, a former Alaska-based EPA biologist, worked inappropriately closely with parties opposed to developing a mine at the Pebble deposit.

"We did find that an EPA Region 10 employee used personal non-governmental email to provide comments on a draft Clean Water Act Section 404(c) petition from tribes before the tribes submitted it to the EPA," the EPA Inspector General wrote.

The investigative body said it could find no evidence that North's involvement in editing the petition was known by his superiors.

"The report concludes that no one at EPA knew that Phil North was engaging in this improper conduct with environmental activists; we have emails that show almost a dozen people did," Collier said.

This evidence indicates that EPA management as high as Dennis McLerran, the administrator for region 10, which includes Alaska, was aware of the close relationship between North and Pebble antagonists.

A January 2010 briefing for then EPA Administrator Lisa Jackson shows that during the same time that North was helping Pebble antagonists draft the petition, officials in EPA's Washington D.C. office were already discussing the possibility of a pre-emptive 404(c) veto of Pebble. While it is unclear whether or not EPA's highest office was considering this plan separately from what was going on in Alaska, this briefing comes several months prior to requests for such actions by Bristol Bay Native groups, which EPA said was its impetus to consider using the unprecedented method of stopping a project ahead of permitting.

The stage is set

The EPA Inspector General Office's findings are in sharp contrast to conclusions to the recently completed investigation by former U.S. Secretary of Defense William Cohen, who was hired by the Pebble Partnership to complete a review of EPA's actions surrounding the Bristol Bay Watershed.

Cohen said his investigation turned up evidence of questionable activities by EPA and urged federal watchdog groups such as the EPA Inspector General and U.S. House Oversight Committee to probe further into EPA's actions at Pebble.

"After an analysis of thousands of documents and discussions with more than 60 stakeholders, I conclude that EPA's actions were not fair to all stakeholders," Cohen wrote in a 346-page report outlining his findings. "The statements and actions of EPA personnel … raise serious concerns as to whether EPA orchestrated the process to reach a pre-determined outcome."

Collier was somewhat surprised at the large chasm between the thoroughness of the inspector general and Cohen reports, considering they were tasked to investigate the same topic and had access to the same evidence.

"I think it is the single most embarrassing piece of work by an inspector general that I have seen in my 40 years of working with inspector generals," the Pebble CEO told Mining News.

The Pebble Partnership, however, was not caught off-guard by the findings.

"One of the reasons we initiated the Cohen report is there was a great concern that there might be a whitewash in the inspector general investigation," Collier said.

The contrasting conclusions also has set the stage for the continuation of a lawsuit in which the Pebble Partnership alleges EPA worked secretly with anti-Pebble groups in pursuit of the goal of banning or restricting development of Pebble prior to the permitting process.

"We are by no means through making our case that EPA acted inappropriately and perhaps illegally with respect to Alaska's Pebble project," Collier said. "We will have the opportunity to depose as many as 35 senior EPA officials, insiders and others in the environmental community as part of our FACA discovery, and we continue to gain new information and fresh insights through the investigative efforts of Congress."

Supported by the growing piles of email conversations and other incriminating evidence, Collier said he expects the trial "questioning will be dramatically more intense than what the IG did."

Depositions are expected to be scheduled within the next month, setting up the next stage of the trial.

Collier said the findings of the inspector general report parallels the arguments made by EPA in the case, but this stance is not enough for the agency to prevail considering the massive amount of evidence to contrary.

Federal Judge H. Russel Holland, who is presiding over the case, has already found Pebble's allegations credible enough to issue a preliminary injunction ordering the regulator to halt efforts to use Section 404 (c) of the federal Clean Water Act to pre-emptively block or restrict Pebble permits.

A number of U.S. Congressional committees - including House Science, Space and Technology and House Oversight and Government Reform - have been critical of EPA's attempt to use the 404(c) process to pre-emptively restrict the Pebble mine project.

Science, Space, and Technology Committee Chairman Lamar Smith, R-Texas, said his committee will continue its probe into EPA's actions.

"The Inspector General's report on EPA's actions to block the Pebble Mine draws misleading conclusions without having all the facts," Lamar responded to the report. "It also appears that the IG failed to review a significant body of publically available information brought to light by the Science Committee that demonstrates clear instances of bias and predetermination on the part of the EPA."

Collier expects that the EPA Inspector General Arthur Elkins, Jr. will be called before these committees to testify on the quality and content of the report.

"This issue is just too important to be swept under the rug - not only for us and for the State of Alaska, but for the integrity of objective, science-based decision-making in this country," the Pebble CEO said.

Author Bio

Shane Lasley, Publisher

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Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.


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