Montana DEQ Issues Bond Request to Lucky Minerals Inc.

The Montana Department of Environmental Quality (DEQ) has sent a bond request to Lucky Minerals Inc., which wants to drill north of Yellowstone for gold.

The news comes after the DEQ gave the Vancouver-based company the go-ahead to perform exploratory drilling on private land in the Paradise Valley, after promising to monitor wastewater and train employees on how to properly interact with wildlife. Lucky Minerals previously said they expect to start drilling by the end of the year.

However, according to the Bozeman Daily Chronicle, the company is taken aback by the amount the DEQ is seeking. The DEQ is asking Lucky Minerals Inc. to pay a $154,274 reclamation bond before it can begin drilling; the bond is set to “cover the filling of 12 holes and restoration of the 23 pads where the company plans to drill.”

The DEQ reports the bond would cover reclamation should Lucky Minerals drill and find their claim is not worth mining. And although the company is balking at the amount, gold mining opponents feel the bond is not high enough for their tastes. From the Chronicle:

The mining company feels the bond is too high.

“It’s about five times what it should be,” said Shaun Dykes, the vice president of Lucky Minerals.

DEQ spokeswoman Jeni Garcin said in an email that the agency has recently changed how it determines bond amounts because mining bonds have been too small in the past, and that the agency is now “more protective of state and taxpayer liability.” She added that the bond amount was partially in response to concerns raised to the agency about the bond amount.

But mine opponents still feel the bond is too small. Locals and environmentalists have been fighting against Lucky for more than two years, and they argue that the company’s exploration will only lead to a large-scale mine with the potential to harm water quality and the region’s tourism-based economy.

Michelle Uberuaga, the executive director of Park County Environmental Council, said they are working with experts to determine whether they should challenge the bond amount.

“What if something goes wrong or there is an accident?” she said. “One hundred and fifty thousand dollars doesn’t go very far to ease community and business concerns.”

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DEQ calculated the bond for just 12 holes because they plan to inspect the site periodically to ensure that the company is filling the holes. Dan Walsh, the acting hard rock mining bureau chief for DEQ, said the exploration could be shut down if the company isn’t doing so.

Dykes said he takes issue with the way DEQ calculated the cost of filling the holes. But he said the company will put up the bond as long as it can get some of the money released as it does the work. The letter to the company said that Lucky would need to provide documentation that it did the work before that part of the bond could be released.

The bond will also include money for revegetating the drill pads, spraying noxious weeds, water monitoring and spill clean-up.

In spite of the bond amount coming in higher than anticipated, Lucky Minerals still plans to start drilling later this fall.