Rep. Andrew Falk grills PolyMet’s Brad Moore on early-stage company’s financials

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Back in August, the Guardian reported in Tony Hayward’s interim chairman role at Glencore could become permanent:

Tony Hayward, the former boss of BP best remembered for being forced to resign from the oil group over his handling of the Gulf of Mexico disaster, has been revealed as a surprise candidate for the next permanent chairman of mining-cum-trading group GlencoreXstrata.

Glencore did not explain the drop in value of the Xstrata side of the business in detail, although much of it is believed to relate to early-stage projects and greenfield operations, mines that Xstrata was building from scratch and which have long been unpopular with [chief executive Ivan] Glasenberg. They include a $5bn nickel operation, Koniambo in New Caledonia.

GlencoreXstrata owns 33.9% of PolyMet’s common shares, one of those start-up mining companies that even Glencore’s own CEO might not love. As PolyMet noted in its SEC FORM 20-F filing for 2013:

While we were incorporated in 1981, we have no history of producing minerals. We have not developedor operated any mines, and we have no operating history upon which an evaluation of our future success or failure can be made.

No wonder that my state representative, Andrew Falk (DFL-Murdock) expressed concern about the proposal to mine copper and other minerals in Northeast Minnesota.

This article is reposted from TCDP media partner Bluestem Prairie. Check out the links below for other recent Bluestem Prairie stories:

Falk’s grilling of PolyMet’s representative drew headlines across the state, from the excellent piece in MinnPost by Ron Meador, How would ‘damage deposit’ work for PolyMet? Many questions, no answer and the Star Tribune’s Packed, testy hearing airs pros, cons of PolyMet copper mine to Don Davis’s Minnesota lawmaker accuses PolyMet of being a shell corporation.

The headline overstates Falk’s questions a tad, though one does wonder just why a company that has never run a mine should be allowed to do so, when the corporation with such a strong position in the company has had so much difficulty running a copper mine anywhere in the world without polluting the areas in which its mines are located.

While the concerns about 500 years of cleanup receive much attention, Bluestem fears that such long-term worries might persuade some Minnesotans that we can roll the dice and mine now, and clean up later (surely a technological miracle will come along). It’s a comforting fiction.

But the distinct possibility that the BWCA and groundwater might be damaged in the short-run seems well within the realm of the probable. Who will profit from this? Who will pay? What is the relationship between the giant international corporation and PolyMet?

Who knows? Watch Representative Falk try to obtain an answer–near the end of the five hour plus hearing.