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American Resources President Dan McGroarty made his second appearance on the Glen Biegel Show in Anchorage, AK on Monday to discuss the U.S. mining permitting process and the proposed Pebble mine. Listen below.

 

 

California’s nickname, “the Golden State,” can be traced by back to the discovery of the precious metal in the middle of the 19th century. For decades after World War II, it was the proverbial land of milk and honey, a destination for people and businesses in search of opportunity.

Fast forward to today, and the Golden State has lost much of its shine. California has been hemorrhaging residents and businesses for several years, and a closer look reveals that much of this outmigration is due to its poor business and regulatory climate. A look at the mining industry, an area with much potential in the state given California’s vast mineral riches sheds some light.

Once a mecca for resource developers, the state has “probably the most difficult place to obtain the permits to extract the great wealth from the ground.” In the 2011/2012 Fraser Institute Survey of Mining Companies, an exploration company manager laments: “There are NO exemplary policies in the State of California in relation to mining or the environment. They got it wrong.” And another mining executive adds: “California seems to lead the way in North America in trying to impede development of any sort.” In the Fraser Institute’s 2012/2013 ranking, California had the dubious honor of being the runner-up in the “jurisdiction-with-least-favorable-policies-towards-mining” category, surrounded by jurisdictions like the Democratic Republic of the Congo, Zimbabwe and Venezuela.

Indeed, California has some of the strictest environmental regulations and if a project passes the Federal sniff test – difficult enough given our protracted national approval process – it does not an automatically guarantee it will clear The California Environmental Quality Act. (CEQA). It’s no wonder that so many companies and public officials in Sacramento are calling for significant reform to CEQA this year.

Permitting delays are the order of the day, so much so that more than fifty percent of respondents in the Fraser Institute Survey are calling regulatory duplication and inconsistencies, as well as regulatory uncertainty, strong deterrents to investment in the state, with many even saying they would not invest.

While it is difficult to put a number or even a price tag on the opportunities lost, the U.S. Chamber of Commerce’s report, “Progress Denied: A Study on the Potential Economic Impact of Permitting Challenges Facing Proposed Energy Projects,” gives a glimpse into projects delayed by impediments like regulatory barriers, and attempts to calculate the potential losses in economic value. For California, the study lists 31 such projects, and the figures below illustrate the benefits which could be reaped from bringing these projects online.

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Benefits from Proposed Energy Projects in California
(delayed or cancelled due to significant impediments such
as regulatory barriers)

Upfront Investment (total of all projects)
Total Economic Output (in PDV) $59,100,000,000
Employment Earnings (in PDV) $19,600,000,000
Average Annual Jobs 142,100

First Year of Operations (total of all projects)
Total Economic Output (in PDV) $6,500,000,000
Employment Earnings (in PDV) $1,700,000,000
Average Jobs Created in Year 1 32,200

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The numbers are staggering on their own terms – but if one considers the fact that the Chamber study only covers energy-related projects, it becomes apparent just how much economic opportunity is forgone in California due to regulatory red tape.

Unfortunately, while other U.S. states like Alaska and Wisconsin are making strides towards improving their regulatory environment, there is no improvement in sight in what used to be the Golden State.

Testimony presented by Daniel McGroarty – Oversight Hearing of the U.S. House of Representatives Committee on Natural Resources Sub-Committee on Energy and Mineral Resources, March 21, 2013 Chairman Lamborn, my thanks to you and your colleagues on the House Sub-Committee on Energy and Mineral Resources for the opportunity to testify today. I am Daniel McGroarty, [...]

In a letter to the editor of the Wall Street Journal, a reader from Arizona responds to American Resources Principal Daniel McGroarty’s op-ed “America’s Growing Minerals Deficit.” Citing Canada-based Augusta Resources’ Rosemont copper mine project in southern Arizona as an example, the reader alleges McGroarty “overlooks one very important consideration. There isn’t any assurance that [...]

With the stated goal of kicking off a“new conversation—a better conversation” about energy, U.S. Senator and Senate Energy and National Resources Committee Ranking Minority Member Lisa Murkowski (R-Alas.) has released a set of policy priorities in a report she developed with the committee’s staff. The blueprint’s key premise is that energy should be “abundant, affordable, [...]

The following op-ed by American Resources Principal Dan McGroarty was published in the Wall Street Journal on January 31, 2013. The original text can be found here. America’s Growing Minerals Deficit The U.S. is now tied for last, with Papua New Guinea, in the time it takes to get a permit for a new mine. By [...]

This is part three of American Resources’ three-part 2012 retrospective. Check out parts one here and two. Traditionally, the New Year is the time when people reflect on the past twelve months and formulate resolutions for the months ahead. As the first hours of 2013 have been dominated by the drama the Fiscal Cliff, our [...]

  American Resources Principal Dan McGroarty appeared on the Glen Biegel Show on Tuesday to discuss domestic mineral development and what the United States can do to take advantage of its critical metals, particularly in the resource-rich state of Alaska. Listen below.

While most Rare Earths-related stories focus on China these days, there’s no denying that the race for critical mineral resources has arrived on the North American continent. As the Fairbanks Daily News Miner reports, Alaska State geologists are excited by the findings of recent mineral cataloguing efforts, with a new $3 million program underway. The [...]

Japanese electronics maker Panasonic has built a new consumer Lithium-ion factory in Suzhou, China. While the plant is located on the premises already owned by Panasonic, the new facility is a manifestation of an ongoing trend of foreign manufacturers moving their production sites into China in order to mitigate reduced access to and increased costs [...]