Editorial U.S. Mining Act is best left alone

The Mining Act of 1872 governs federal lands that are open to mineral development, that is, federal land that has not already been set aside for parks, wilderness areas or other purposes. There’s an estimated 750 million acres of public lands in the United States, about one-third of the country’s total land mass. Most of that — half to two-thirds — is unavailable for one reason or another. The rest is open to anyone who wishes to go onto the land and stake a claim, provided they comply with any other laws such as those that protect the environment.

That is one of the beauties of the Act of 1872: its simplicity. It was designed on the basis that anyone, be they a long-time prospector on his own with limited resources or the representative of a major mining company, has the right to try to develop the mineral wealth that may lie in the ground.

Supporting the move to change the law is a report from the federal government’s General Accounting Office. Prepared at the request of Representative Nick Rahall, chairman of the House Mining and Natural Resources subcommittee, the report comes to the conclusion that the Act should be changed because mining laws are increasingly being misused for other than the intended purpose of mineral production.

That report has grabbed a lot of attention, but the AMC says the GAO’s report is based on “untruths, half-truths, omissions and errors — at least three dozen by last count.” AMC Chairman Milton Ward, who is president and chief executive office of Freeport-McMoRan Inc., says he considers the report “47 pages of discredited trash.”

What prompted a review of the Act was the suspicion that obtaining title to land for the stated purpose of exploiting its mineral potential was a cheap way to speculate on its real estate value.

While it is true that a patent fee can be had for $2.50 per claim for placer mining claims ($5 for lode claims), that is only after it can be demonstrated that the property hosts a mineral deposit that can be extracted at a profit. There’s a considerable amount of work that has to be done on a claim before that point is reached, if, indeed, it ever is reached.

The Mining Act of 1872 has been a remarkably resilient piece of legislation. It has served the industry and the nation well for more than a century. The Act is a good law that works and legislators should be guided by the principle: “If it ain’t broke, don’t fix it.”

Whatever perceived benefits may come out of repealing the old law and issuing a new one — and it is not at all clear what those benefits would be — they are likely to be outweighed simply by the effect of opening the legislative process.

Opening the process would be an ominous development for anyone in the industry who benefits from working under a set of established and stable ground rules. Once the Mining Act of 1872 is rejected the door is open for every special interest group to demand its particular concerns be addressed in any new legislation. That in itself will bog down the process of formulating a new law, but that new law would inevitably fall short of expectations of one group or another. The result? Legal challenges that would go on for years. The legislative process is a Pandora’s box; once opened, the troubles that escape cannot be controlled. For the sake of mineral exploration companies working in the U.S., Congressmen should be very careful about replacing a law that has worked well for longer than any of them have been alive.

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