The year in mining: Projects continued slow progress in 2022

A report from the U.S. Geological Survey in early 2022 said the U.S. is reliant on China for more than 50% of 25 mineral commodities. In 2021, imports made up more than one-half of the U.S. consumption of 47 nonfuel mineral commodities, and the U.S. was 100% net import reliant for 17 of those.

There is talk of more domestic production, and there has been government funding to boost some projects that are in the works, but not much seems to be happening to speed along these projects toward production. Throughout 2022, projects that we have been hearing about for years continued through the long, slow permitting process, and in some cases, projects continued with the long process of litigation over environmental concerns.

“The reality is that the federal process to permit a mine changes constantly depending on the administration, and is subject to political challenges and third-party lawsuits resulting in a staggering average of 10 to 12 years to permit an average project. Just let that sink in,” Steve Trussell, executive director of the Arizona Mining Association, wrote in a column in the June issue of Mining the West magazine.

“It is imperative to understand that many critical minerals we are importing are completely controlled by foreign governments that lack rigid environmental standards, meaningful worker safety programs, anti-corruption laws or ethical leadership,” Trussell said. “For instance, China currently controls the production of 80% of rare earth elements, 70% graphite, 59% lithium and 36% cobalt.”

On Nov. 15, 2021, President Biden signed the Infrastructure Investment and Jobs Act, which includes a wide variety of provisions, including a requirement that the Bureau of Land Management and the U.S. Forest Service conduct a thorough self-assessment of their minerals permitting procedures.

“This sounds good in principle,” said Michael Visher, the administrator of the Nevada Division of Minerals. “However, it doesn’t address the one thing that impacts the permitting process the most, staffing. The BLM and USFS are under-staffed and under-resourced at current permit activity levels. Increased exploration and permitting activity resulting from the anticipated need for more minerals will only exacerbate the current challenges.”

On Feb. 22 Biden announced an array of investments his administration is making to boost the “Made in America” supply chain for critical minerals.

One of those investments was $35 million awarded to MP Materials of Las Vegas, which has a rare earth mine at Mountain Pass, California.

In response to the “Made in America” announcement, National Mining Association spokesperson Ashley Burke said, “We would hope that the administration’s examination of minerals supply chain issues would focus on how to restore U.S. mining’s competitiveness on the global stage, decrease our import reliance, and ensure that existing federal and state regulations are not duplicated. Instead, however, Interior’s language suggests it is using the supply chain review as a thinly veiled attempt to advance misguided mining law reforms that have failed in Congress time and time again.”

The year 2022 was the 150th anniversary of the Mining Law of 1872, and Rep. Raul Grijalva (D-Ariz.), who has made many attempts to reform the law, introduced a Clean Energy Minerals Reform Act on April 26 that included a 12.5% royalty on new mining operations, along with many other provisions.

Many organizations and legislators made comments which might make people unfamiliar with mining think that since we are still operating under a 150-year-old law, mining companies are free to start up a mine and do whatever they want to the land.

“By keeping this outdated system going, we’re telling mining companies it’s okay to wreak total havoc on our environment and then leave American taxpayers to foot the cleanup bill,” Grijalva said in a press release.

On March 31, Biden announced plans to invoke the Defense Production Act to provide hundreds of millions in new subsidies for the mining of minerals critical for the wind, solar and electric vehicles industries.

Bernard Rowe, managing director of Ioneer, which is developing the Rhyolite Ridge lithium-boron project southwest of Tonopah, said in the company’s first quarter report that “This increased political focus had already been felt by Ioneer through the quarter with a clear shift in momentum for the Rhyolite Ridge Project.”

The Stibnite project is in the sixth year of review under the National Environmental Policy Act. The Supplemental Draft Environmental Impact Statement for the project is in a public comment period that ends Jan. 10, 2023. A statement on the Defense Production Act award to the project points out that the award “does not confer any right or benefit through the permitting process.”

Lithium

Lithium is just one of the minerals needed for a greener future with vehicles running on electric batteries, but lithium continued to be highlighted in the news throughout the year. Lithium Americas’ Thacker Pass project north of Winnemucca and Ioneer’s Rhyolite Ridge project southwest of Tonopah continued through their multi-year processes of permitting and dealing with environmental issues.

And there are currently around 15,500 claims across Nevada related to lithium, so many more projects could be coming along down the road.

Albemarle, the world’s largest lithium producer, has the only producing lithium mine in the U.S., Silver Peak southwest of Tonopah. Albemarle released its 2022 guidance in May and had to substantially increase its earnings predictions three weeks later as it renegotiated contracts with lithium customers as lithium prices continued to rise.

Albemarle said its 2022 volume of lithium was expected to be up 20 to 30 percent over 2021 primarily due to new capacity coming online.

By November 2022 the price of lithium was more than 10 times higher than 2020 prices, but some analysts expect the price to go way down over the next couple of years as more lithium mines begin production.

But whether that production will be in the U.S. remains to be seen.

Thacker Pass

On Feb. 25 the Nevada Division of Environmental Protection issued three major permits for the Thacker Pass project. Great Basin Resource Watch filed an appeal to the Water Pollution Control Permit, largely based on concerns that there had been inadequate analysis of the mine’s tailings facility. A study commissioned by GBRW said the tailings facility ”would probably have greater water content than any tailings storage facility ever constructed.” On June 28, the Nevada State Environmental Commission voted unanimously to affirm the Water Pollution Control Permit.

On July 20 Lithium Americas held a ribbon cutting for its 30,000 square foot Lithium Technical Development Center in Reno.

On Oct. 20 Lithium Americas announced it had entered into a Community Benefits Agreement with the Fort McDermitt Paiute and Shoshone Tribe.

Also in October, the Western Mining Action Network held its biennial conference in Reno, with a focus on Thacker Pass and the proposed mine’s threat to a Native American cultural and spiritual site. On Oct. 16 around 80 people opposed to the mine, including WMAN people, local ranchers, and members of People of the Red Mountain, a Native American group fighting the mine, gathered near the Thacker Pass site.

“Nevada is ground zero for this rush to new mining,” said Kassandra Lisenbee, GBRW outreach and program coordinator. “The Western United States is facing 94 new lithium proposals, 65 of which are located in Nevada. We should not allow a bad permitting process for what is considered a desirable material.”

Lithium Americas has received all the federal and state environmental permits necessary to begin construction of Thacker Pass and is waiting for a ruling on an appeal against the Record of Decision which was issued by the Bureau of Land Management in January 2021. An oral hearing on the appeal is set for Jan. 5, 2023.

Rhyolite Ridge

Ioneer Managing Director Bernard Rowe said in an interview with Mining the West magazine in April that Ioneer has spent $110 to $120 million over the past six years on the Rhyolite Ridge project. He said every lithium deposit is different, and it takes a big investment to determine the best methods for extracting and refining the materials.

In 2023 Ioneer signed lithium offtake agreements with Ford Motor Company, EcoPro Innovation, and Prime Planet Energy & Solutions.

Also, Ioneer completed an agreement with Caterpillar to adopt an autonomous haul system at the mine.

On Dec. 14 the U.S. Fish and Wildlife Service declared that the rare Nevada wildflower Tiehm’s buckwheat is endangered. The buckwheat has been found only on 10 acres of land in the area of the proposed Rhyolite Ridge mine.

Less than a week later the Bureau of Land Management announced it is beginning a review of the Rhyolite Ridge project. Rhyolite Ridge is the first lithium project to be issued a Notice of Intent under the Biden administration.

Ioneer said with this step taken, a Record of Decision could be issued in the first quarter of 2024, allowing construction to begin, which could take around two years.

There will be further battles over the Tiehm’s buckwheat.

“Rhyolite Ridge Mine poses an existential threat to Tiehm’s buckwheat, and we’re gearing up for a fight,” said Patrick Donnelly, Great Basin director at the Center for Biological Diversity.

Rowe said Ioneer has spent well over $1 million researching and understanding the plant to protect it and help it to spread.

Rowe said he sees the mine as a win-win because while producing raw materials which will help address climate change, “some of the money that’s generated from producing those raw materials for electrification are actually going to be used to get Tiehms’s buckwheat on a pathway to where it can be sustainable for the long-term.”

Projects coming online: I-80 Gold

I-80 Gold, a new Northern Nevada gold mining company, was formed in March 2021 as a spinoff when Equinox Gold Corp. acquired Premier Gold Mines, and marked its first anniversary as a publicly traded company on April 7, 2022.

“2022 will be a truly transformational year for i-80,” said Matt Gili, i-80 Gold president and chief operating officer.

“We expect to be the second biggest producer in Nevada,” said Ewan Downie, i-80 Gold chief executive officer. He said the company’s goal is to produce more than 400,000 gold ounces per year.

On Feb. 23 i-80 Gold announced they had started the underground mining program at the Granite Creek Mine in Humboldt County. According to i-80, the underground deposit at Granite Creek is one of the highest-grade gold deposits in North America.

The company announced on March 9 that it had completed its initial gold sales from heap leach operations.

By the end of the year, i-80 Gold Corp. was mining at Granite Creek, looking at restarting the mill at Ruby Hill, studying the restart of the autoclave at Lone Tree, preparing for underground exploration at McCoy Cove and permitting for an open pit mine at Buffalo Mountain.

Goldrush

Barrick has been exploring and planning the Goldrush Mine Project in the Cortez trend southwest of Beowawe since the early 2000s. The site has twin portals and NGM has been conducting test mining. In 2022 the site took another step toward production when the BLM published a draft environmental impact statement on June 30. NGM invested about $22 million in preparing the EIS.

The Final EIS and Record of Decision are expected in the first half of 2023.

“Goldrush will be a world-class underground mine,” NGM said in a statement.

Barrick President and CEO Mark Bristow said that when Goldrush is in full production and combined with other Cortez production, the Cortez mines will produce one million gold ounces a year.

The Goldrush Mine is expected to employ about 570 people directly and 407 people indirectly.

Elko County mines and projects

Several big mines in Northeastern Nevada are just outside the borders of Elko County, but inside Elko County, the Jerritt Canyon mine has a new owner and is working toward ramping up production, and several exploration projects made progress in 2022.

First Majestic Silver Corp. purchased the Jerritt Canyon Gold Mine about 50 miles north of Elko in April 2021.

“We’ve got a great mine there,” First Majestic President and CEO Keith Neumeyer said at the start of 2022. “We’re expecting it to grow substantially over the next couple of years.”

“Since our acquisition, our team has made significant steps towards rebuilding Jerritt Canyon’s reputation within the state of Nevada, and having received the USFS exploration permit is a major achievement for the future growth of Jerritt Canyon,” Neumeyer said in June.

The two operating underground mines at Jerritt Canyon have been connected, two past producing underground mines were reopened by the end of the year, and First Majestic has been working on short-term and long-term exploration.

“We’re doing the things we need to do for the mine by adding immediate ounces and converting resources to a higher category,” Jerritt Canyon Exploration Manager Rob Edie said. “But we want to find a new mine, a new million ounces that we can develop ourselves … And this is our opportunity to explore where previous operators have not explored.”

In February 2022, Gold Standard Ventures Corp. completed its feasibility study of the South Railroad Project in the Carlin trend southwest of Elko in Elko County. In April the company announced it was beginning its first stage exploration program at the site.

In June Orla Mining Ltd. and Gold Standard announced that they had entered into an agreement for Orla to acquire all of Gold Standard’s shares, for a total consideration of about $187.8 million.

The South Railroad Project was about 18 months into the permitting process at that point.

“This acquisition advances our strategy of creating stakeholder value through responsibly building and operating a portfolio of high-margin, cash-generating assets with superior geological prospectivity,” said Orla CEO Jason Simpson.

“We have the team, partners, and financial resources to develop this quality asset and we are ready to go.”

Hecla Mining is not currently mining at the Midas and Hollister mines in northern Elko County, but the company is developing a decline for underground exploration at the Hatter Graben deposit on the Hollister property and is exploring at Midas.

American Pacific Mining Corp. said it was spending about $4 million on a drilling program at its Tuscarora Project about 12 miles southwest of Jerritt Canyon. In July the company said two of the veins showed very strong quartz responses, and further potential systems were identified later in the year. The company said visible gold particles were found in the exploration area.

Western Exploration Inc. is a public company formed in 2022 to focus on the Aura Project in northern Elko County, where the predecessor private company has been exploring since the late 1990s. The Aura project is about 20 miles north of Jerritt Canyon.

Western Exploration CEO Darcy Marud said the private company spent roughly $35 million since 2013 and now needs $5 million to $10 million a year.

A technical report says the site has an indicated resource of 652,271 gold equivalent ounces and an inferred resource of 665,357 gold equivalent ounces.

Contact Gold has the Pony Creek project in Elko County south of Orla Mining’s South Railroad project. The company acquired Pony Creek in 2016 following Gold Standard Ventures’ encouraging early exploration results at the South Railroad property. Contact Gold said it has drilled 118 holes on the property and has discovered and defined five zones of gold mineralization at shallow depths.

In November Anova Metals Ltd. announced the completion of an updated Mineral Resource Estimate at its 100%-owned Big Springs Gold Project in Elko County about 12 miles north of Jerritt Canyon.

“The independently updated Mineral Resource Estimate has confirmed we have in excess of one million ounces of contained gold at Big Springs,” Anova Managing Director Amanda Buckingham said.

“What is exciting is the sheer, relatively untapped resource growth potential that remains at Big Springs.”

Hycroft Mine

In November 2021 Hycroft Mining Holding Corp. announced it was ceasing mining operations at the Hycroft Mine 55 miles west of Winnemucca, but would continue to process ore and would focus on building a mill, which could take two to three years.

The Hycroft Mine got a cash infusion and received some national attention when a couple of investors stepped up to the plate. In March 2022 AMC Entertainment and precious metals investor Eric Sprott each invested $27.9 million in cash in Hycroft.

Some people questioned why Adam Aron, the CEO of a movie theater chain, was investing in a gold mine.

“One would not normally think that a movie theatre company’s core competency includes gold or silver mining,” Aron told Barron’s.

However, after going through some rough times, especially during the Covid-19 pandemic, and reportedly approaching bankruptcy in early 2021, AMC put new shares of stock up for sale in mid-2021, which became a popular “meme stock” bringing in about $1.8 billion, giving the company money to invest.

“While the Hycroft investment is pretty far from home, it does rely on a core competency of our company to understand balance sheets, and raising cash, and solving liquidity problems,” Aron told Reuters.

Later in March, after the investments from AMC and Sprott, Hycroft completed an “at-the-market” equity offering program that brought in about $138.6 million.

“I was highly confident that AMC’s skills could quickly ‘right the ship’ at Hycroft,” Aron tweeted on March 25. “We just did! Eric Sprott and AMC invested $56 million. Now we raised a breathtaking $139 million more cash equity! $195 million in total! In only two weeks! Calm seas, smooth sailing ahead.”

Another tweet from Aron said, “What I can say to those who doubted AMC’s investment in HYMC … #CHOKEonTHAT”

Two days later Aron tweeted, “I think AMC should issue a ‘There’s Gold in Them Thar Hills’ NFT for AMC Investor Connect members. Your thoughts?”

The Hycroft stock price was around 30 cents in early March, but jumped with the news of the investments and reached a high of $2.59 on March 29. However, the Hycroft stock price has declined since then, and was around 51 cents at the end of the year.

AMC stock also reached its high point for the year on March 29, topping out at $29.44, but fell to around $4.14 by the end of the year. Aron tweeted that with the low stock price, the AMC board of directors should freeze his compensation for 2023.

In the meantime, Hycroft was making progress with its exploration of the mine site and with working on technical studies of utilizing a milling process to restart the mining.

“There has been no exploration drilling at Hycroft since 2014 and, prior to that, drilling was focused on step-out drilling from the known pits for heap leach operations,” a July statement from Hycroft said. “Today, the company is focusing on the higher-grade opportunities identified in the 2021 program, and for the first time at Hycroft, a systematic approach to understanding the genesis of this world class scale deposit, including potential feeder systems.”

“We continue to be extremely pleased with the positive results from our exploration program,” Hycroft president and CEO Diane Garrett said in late December. “The second phase of the drill program will continue through the first half of 2023. Once permits are received, we will be stepping out beyond the known resource area and drilling prospective high-grade targets identified within our vast land position.”

Workforce shortages

The Covid-19 pandemic caused lots of workplace changes and shook up the labor market around the country, and as the pandemic subsided in 2022 we found that the U.S. had a record number of job openings.

In March the number of job openings in the United States went up to 11.86 million, according to the U.S. Bureau of Labor Statistics. That’s the highest level in records that date back 20 years, Christopher Rugaber reported in an AP story.

“At that level, there are nearly two job openings for every unemployed person,” Rugaber wrote. “That’s a sharp reversal from the historic pattern: Before the pandemic, there were always more unemployed people than available jobs.”

Also, “the number of people quitting their jobs remained near record highs at 4.4 million in April. … Nearly all of those who quit do so to take another job, typically for higher pay.”

By October those number were lower, but still high. There were still 10.3 million job openings, and 4 million people quit their jobs.

At a Nevada Business Magazine roundtable discussion in February, NGM Executive Managing Director Greg Walker said, “Directly, the (pandemic) was not as impactful as it was in other industries. The big impact we’ve seen is the Great Resignation and people changing their career paths. We’ve gone from having 200 to 300 vacancies at any given time, to over 600 vacancies. We simply can’t get people.”

Mining companies across Nevada and the Nevada Mining Association have been taking a variety of approaches to attracting more people to the mining industry.

Coeur Rochester launched a new skilled trades program in 2021.

“We invest in our people and offer on-the-job training,” said Joe Kemp, vice president and general manager at Kinross Bald Mountain. “This means that employees who join us in entry-level roles can develop into technical roles, which are typically more challenging to source.”

Nevada Mining Association’s Mining Vegas for Talent program focuses on people from underserved communities in Las Vegas and invests in their futures by helping to give them access to jobs in mining.

By July, NGM had hosted three career fairs in 2022 and participated in 59 other recruiting events.

NGM also focuses on supporting local communities, making major investments and working together with partners to help make these Northern Nevada communities more attractive places to live and work.

Crews started working on the former National Guard Armory in Elko in October to turn it into a new Mining Center for Excellence. The Mining Center for Excellence is a partnership of the University of Nevada, Reno and Great Basin College. It is scheduled to open in August 2023 and will offer one-year, two-year, three-year and four-year programs to train people for jobs in the mining industry. It will also have programs for high school students.

In addition to all these programs, some people have been attracted to the mining industry this past year by the TikTok videos created by Cory Rockwell, a miner who works in an underground mine outside Winnemucca who decided to make videos to let other people know about mining.

“It’s a shame that the mining industry as a whole has had a workforce shortage because people don’t know about mining,” Rockwell said. “Barrick continuously says that they want to hire a younger workforce. Well, that younger workforce doesn’t live in Winnemucca, Nevada. They live in New York City, or in places in Texas where they don’t know about mining, and they’re not going to hear about your job fair in Elko, Nevada, or Winnemucca, Nevada.

“They’re on social media. So if you want a younger workforce and if you want to get people interested in mining, you’ve got to go to where they are, which is social media.”

“I’ve gotten countless comments over the past year from people thanking me for showing them the door to mining.”

Safety

The mining industry is so much safer than it used to be. But there are still too many accidents and tragic fatalities. Reading through the fatality reports issued by the Mine Safety and Health Administration, often you can clearly see steps that should have been taken that would have prevented the accident.

Looking back to the early 20th century, in 1917 there were 2,696 coal mining fatalities in the U.S., and there were 983 fatalities at metal and nonmetal mines. That’s a total of 3,679 mining deaths in one year; an average of 10 mining fatalities every day.

According to MSHA, in 2015 the total number of mining deaths in the United States fell below 30 for the first time since the records began. For the following five years, the number of mining deaths per year ranged from 24 to 29. In 2021, however, the number of mining fatalities climbed to 37.

In 2022 there were 12 mining fatalities in the first three months of the year. Then in April and May there were no mining fatalities. That two-month good safety record didn’t last, however, and by the end of the year there were a total of 29 mining fatalities in the U.S.

One of those fatalities was Marissa Hill, who died at NGM’s Cortez underground mine on Feb. 14.

The MSHA report on the fatality has not been published yet, but a state report indicated that a series of safety failures contributed to the accident.

NGM leadership have confirmed that safety is an area that continues to need improvement.

“Nevada’s got a long way to go to catch up to the rest of our regions around the world on safety,” Barrick CEO Mark Bristow told board members during a meeting in Elko in September.

“We’ve had some bad events since I’ve been here with NGM,” NGM Executive Managing Director Greg Walker said on the Mining Minds podcast. “The number of horrendous injuries I see here is mind blowing. … So we’ve got some work to do from a safety perspective.”

A new and expanded training program with three “training mine” sites got started at Nevada Gold Mines on August 8.

“We revamped every training procedure,” said Andre Lantze, the manager for safety, training and health for NGM’s Carlin Mine.

He said the primary goal of all this training is safety.

As Walker got ready to retire at the end of 2022, Peter Richardson became the new executive managing director of Nevada Gold Mines on Oct. 3.

Richardson said a key focus for him at NGM is safety.

“I’ll continue improving our safety results, our safety culture and behavior. That’s really important for me.”

“Safety is about our people, it’s about caring. At the end of the day we all want to go home safe. So it’s about that. Making sure that everyone is safe. I’m safe, you’re safe, and our friends and colleagues are safe.(tncms-asset)5252ff20-9084-525b-8b5c-c734e817be5e[15](/tncms-asset)