Dr. Hannan LaGarry teaches geology, biology, statistics, and research methods at Oglala Lakota College on the Pine Ridge Reservation. Geology is his main area of study, and he put his geology knowledge to work analyzing borehole logs, drillers' notes, maps, and other data released by Powertech/Azarga last year in its application to the Nuclear Regulatory Commission Atomic Safety and Licensing Board to conduct in situ recovery mining for uranium in the southern Black Hills.

The NRC-ASLB yesterday released Dr. LaGarry's written supplemental testimony, given November 21, 2014. Dr. LaGarry's analysis finds a number of holes in the ground that, claims the scientist, poke holes in Powertech/Azarga's claims that their uranium mining poses no risk to local ground water.

Reviewing drillers' notes from 4,177 boreholes out of 7,515 boreholes logged, Dr. LaGarry finds...

  • 140 open, uncased holes
  • 16 previously cased, redrilled open holes
  • 4 records of artesian water
  • 13 records of holes plugged with wooden fenceposts
  • 6 records of holes plugged with broken steel
  • 12 records of faults within or beside drilled holes
  • 1 drawing of 2 faults and a sink hole within a drilled transect 7 notations “do not record this value on drill hole maps”
  • 2 notations “do not return this to landowner”
  • 63 redacted borehole logs

LaGarry says that the open boreholes and those capped with wood (which rots) and broken steel (which rusts) could allow mining fluids and contaminants to move through the rock strata into unmined areas. He concludes, "There is no reasonable expectation that confinement remains in drilled areas."

LaGarry says the presence of artesian water reveals the possibility that subsurface contaminants from mining operations could reach the surface and contaminate the Cheyenne River and its tributaries.

And what's that about faults?

During hearings before the ASLB in August of 2014, Powertech repeatedly asserted that faults and sinkholes were not present in the license area, and that the license was somehow unique in that regard. In my previous testimony, I offered the expert opinion that faults were almost certainly present, and the license area was most likely crossed by numerous faults. The observations I document herein demonstrate that my previous expert testimony was correct, and there are numerous faults present in the licensed area. Likewise, the drillers’ notes document a sinkhole along a drilled transect associated with two closely spaced faults also intersecting the drilled transect. Sinkholes typically form along faults, as the fault allows the initial penetration of acidic surface waters, which then dissolve a conduit through the rock which eventually forma a cave that subsequently collapses to for the sinkhole [Hannan LaGarry, written supplementary testimony to Nuclear Regulatory Commission Atomic Safety and Licensing Board, 2014.11.21, p. 3].

NRC staff evidently accepted Powertech/Azarga's assertions of environmental safety based on a spot check of three dozen borehole logs, with no apparent mention of the drillers' notes. LaGarry schools the NRC on basic math:

The minimum number of data points for a statistically valid and meaningful sample is generally 10%. In the Powertech instance the minimum acceptable sample size would be a randomly selected sample of at least 175 borehole logs. Based on the recent disclosure of over 4,000 previously withheld borehole logs, the appropriate sample would be 10% of the entire set, or about 575+ borehole logs checked. NRC Staff presents no basis for its so-called “random” selection. Without such information, professionals in my field cannot accept such assertions where it is possible that the limited data set resulted in poor methodology that is the hallmark of modern junk science. Having examined only 37 data points out of thousands available, NRC would have failed my Math 123 Introduction to Statistics class. None of my student researchers would be allowed to publish or present their research findings had they made such a fundamental error [LaGarry, 2014.11.21, p. 5].

Powertech/Azarga has contended that its in situ recovery mining project poses no threat to water quality in the Black Hills and the Cheyenne River watershed. Dr. LaGarry says we shouldn't be so sure.

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The Nuclear Regulatory Commission's Atomic Safety and Licensing Board holds its public comment session on Powertech/Azarga's in-situ recovery uranium mine permit today in Hot Springs. The ASLB panel then rolls up Highway 79 to hold a three-day evidentiary hearing at the Alex Johnson in Rapid City.

Powertech on the porch: (L-R) CEO Dick Clement, lobbyist Larry Mann, project manager Mark Hollenbeck, at Hollenbeck's ranch north of Edgemont, SD, 2014.08.17

Powertech on the porch: (L-R) CEO Dick Clement, lobbyist Larry Mann, project manager Mark Hollenbeck, at Hollenbeck's ranch north of Edgemont, SD, 2014.08.17

I've posted quite a bit on Powertech/Azarga's plans to mine uranium in Fall River and Custer counties. Yesterday I went to Edgemont and talked with Powertech CEO Dick Clement, Powertech's South Dakota project manager Mark Hollenbeck, and Powertech lobbyist Larry Mann. We talked on Hollenbeck's front porch and out on the dusty roads northwest of Edgemont around the Dewey-Burdock project site. Here's what I learned, from Powertech's perspective:

2011 Senate Bill 158

In 2011, the South Dakota Legislature passed Senate Bill 158, which I have written stripped South Dakota of its authority to regulate in-situ leach uranium mining, as a favor to TransCanada. Here's the text of the bill:

The legal force and effect of the underground injection control Class III rules promulgated under subdivision 34A-2-93(15) are tolled until the department obtains primary enforcement authority for underground injection control Class III wells from the United States Environmental Protection Agency. The in situ leach mining rules promulgated under subdivision 45-6B-81(10) as they relate to uranium are tolled until the department obtains agreement state status from the United States Nuclear Regulatory Commission [2011 SB 158].

Larry Mann tells me I got 2011 SB 158 mostly wrong. South Dakota did indeed write rules to regulate in-situ leach uranium mining, and SB 158 did indeed annul those rules. However, those rules were never in effect.

Powertech actually wishes those rules were in effect. Mann says that Powertech would rather deal with state officials than the federal bureaucracy. The Environmental Protection Agency has authority over five classes of water injection issues. The EPA allows states to assume that authority if they write and enforce sufficiently rigorous rules. South Dakota's Department of Environment and Natural Resources prepared such rules for the two classes of water injection relevant to Powertech's uranium operations. However, says Mann, the EPA rejected the DENR's proposed rules, saying that DENR had to take on all five classes. South Dakota thus never had the authority to regulate the issues in question.

2011 SB 158 thus did not make any practical oversight disappear. It clarified that South Dakota's rules had no power. It didn't repeal the rules; it "tolled" them, leaving them on the books awaiting a change of heart from the EPA. But even if the EPA woke up tomorrow and said, "O.K., South Dakota, take over, regulate in-situ leach uranium mining water issues," Powertech would not have an additional hoop through which to jump. On the water injection issues, it deals either with the EPA or DENR, not both.

2011 SB 158 did Powertech one favor. Even though the EPA hadn't granted South Dakota's rules primacy, DENR still wanted Powertech to submit a water-injection application to Pierre. Mann says the federal application was a ten-foot stack of three-ring binders. The state application would have been of similar heft, but DENR wanted a different format, meaning Powertech couldn't just copy its federal app. Mann estimates that preparing that pro forma state app would have cost tens of thousands of dollars. So by clarifying the rules, 2011 SB 158 did leave a little extra money in Powertech's pockets.

Terminology

Reading about Powertech's plans, you'll see the terms in-situ leach mining and in-situ recovery. CEO Clement says Powertech prefers the latter. Leach carries negative connotations associated with the use of cyanide and other caustic chemicals in gold mining and other mineral extraction operations. Clement says recovery is both less negative and more accurate, since Powertech's mining process uses oxygenated, neutral-pH pipe water with baking soda.

We did not discuss the auditory association with leeches, but if I were in a marketing meeting, I'd go there and advocate for ISR over ISL.

Taxes and Trucks

Mann says Powertech will contribute to state and county coffers. Severance tax will provide approximately $2 million to the state, $1 million to Fall River County, and $1 million to Custer County each year. The counties will also receive road maintenance fees to help with the wear and tear on the gravel roads around the mine site between the South Dewey Road and the Cheyenne River northwest of Edgemont.

How many trucks will be dusting up that area? Clement says each uranium truck will carry 50,000 pounds of uranium in yellowcake form. Powertech's permit allows a maximum of one million pounds per year. That's twenty trucks—one or two a month—hauling out uranium. Clement anticipates one or two heavy supply trucks coming in each week.

Worst-Case Scenario

Trucks do tip. Stuff falls out of trucks. What happens if a Powertech truck loses its load and spills urnaium?

Not much, say Clement and Hollenbeck. They envision a worst-case scenario of a train hitting a truck, busting containers, and dispersing the uranium powder in the air. (If that's the worst they can imagine, I find their imagination lacking. How about terrorists with rocket-propelled grenades? How about Timothy McVeigh Jr. going kamikaze with a truckload of fertilizer and an impact detonator?) The greatest danger from such a release is not the radiation. Uranium emits alpha particles—big, fat, slow helium nuclei that can't even penetrate human skin. If I run out to a Powertech train wreck and start scooping up yellowcake with my hands, I don't tingle, glow, or get nuked, says Hollenbeck.

What I don't want to do is eat or inhale uranium. Hollenbeck says the real danger from uranium is heavy-metal poisoning, just like one would get from ingesting lead. Workers cleaning up a yellowcake spill would need respirators and other safety gear, but a Powertech truck-train collision would not be a nuclear nightmare.

Water

Powertech is applying to draw 8,000 gallons of water a minute from the Madison aquifer. Hollenbeck compares that to the 3,500 gallons per minute that Evans Plunge in Hot Springs is permitted to use for recreation.

But as Hollenbeck explains it, that 8,000 gallons per minute is draw, not consumption. It's not like the aquifer is a tank from which Powertech is removing wwater and then placing that water in an entirely separate tank. Powertech's mine, the ground into which it is injecting water to retrieve uranium, is part of the aquifer. Hollenbeck compares the ISL operation to a recirculation pump in a swimming pool: sure, it moves a lot of water, but it is mostly the same water, day in, day out. Hollenbeck estimates that out of 8,000 gallons pulled from the aquifer, 7,920 goes back in.

But that water goes back in with a different chemical composition, right? Whether they reinject wastewater or disperse it on fields, there are minerals in the water that can affect plant and animal life. Hollenbeck says one of the biggest risks is simple salt, sodium chloride. Powertech will have to take steps to remove vanadium and radium from the water it releases. Radium, a natural by-product of the radioactive decay of uranium, is particularly troublesome. Drink water with uranium in it, and your body will flush it out reasonably well, though it will be hard on your kidneys. Drink water with radium in it, and your body says, "Yum, yum!" The human body treats radium like calcium, absorbing it into the bones and replacing the calcium, which you do not want.

However, Hollenbeck says the local water already has high radium levels, and the data from other ISR operations that he's looked at show lower radium levels post-mining.

Sandstone on Hollenbeck ranch, looking south toward Edgemont, 2014.08.17

Sandstone on Hollenbeck ranch, looking south toward Edgemont, 2014.08.17

But suppose Powertech is lying to us. Suppose Hollenbeck, Clement, and Mann leave all sorts of nasty by-products in the mine's wastewater and pee on top of it for good measure. Hollenbeck reminds us that we're talking about an underground aquifer, not a lake or a river. The water of the Madison aquifer moves through sandstone at seven feet per year. If the water is reinjected in the ground, and if the contaminants in it are able to squeeze through the porous sandstone along with the water molecules, contaminants would move one mile in 750 years.

Boreholes, Geology, and ISR Physics

I asked about the boreholes that came up in last week's discussion of the TVA data Powertech acquired and declines to share. Couldn't water flow through those holes or other fractures in the ground and move contaminants faster? Hollenbeck says that any such gaps in the rock would undo the mining operation before releasing any pollution. The ISL process relies on maintaining a certain pressure that ensures the water injected pases by every grain of sand in the sandstone to release every small fleck of uranium. If there's a borehole of other gap, the water will rush to that opening and miss much of the sand, producing far less uranium. Thus, Powertech has as little interest in letting water escape through boreholes and fissures as folks concerned about pollution do.

By the way, on that TVA data: Clement says the data Powertech just bought is actually the basis of reports that they have already submitted. The "new" data acquired is really just the source data of the science everyone's already looking at. Hollenbeck compares it to having the Nixon tapes instead of just the Nixon transcripts. The TVA data shows the drift of the boreholes from their surface locations, allowing Powertech to more accurately target the uranium deposits and avoid the spillage described above.

What Iceberg?

Powertech opponent Lilias Jarding of the Clean Water Alliance says that Powertech is just one of ten companies looking into mining uranium in the Black Hills. She says that Powertech would be the tip of the iceberg, building a processing plant that would support many more uranium mining operations.

Clement rejects Jarding's claim. He says Powertech is the only company he knows of with significant interest in hunting for uranium in this part of the world. He says that back in 2005, many companies had staked claims for uranium around the southern Black Hills, but since then, most of those claims have been consolidated. Powertech itself bought out the claims of a company called Neutron in the Dewey-Burdock area.

* * *

We talked about much more, but those are the highlights. Note that I didn't go to Hollenbeck's ranch to persuade or be persuaded. The Powertech team didn't offer me any fancy shrimp dinner or stocks, just a glass of ice water and drive around the southern Hills on a beautiful summer day. I don't endorse the corporate position; I'm simply reporting what they told me. Weigh this report as you see fit against other information in the press as you decide whether you want more uranium mining in the Black Hills.

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The Clean Water Alliance was at Rickstock yesterday, spreading the word about the perils of the Powertech/Azarga in-situ leach uranium mining proposal for the Black Hills. CWA's Lilias Jarding took a moment to explain what's at stake in the Nuclear Regulatory Commission's hearing on the Fall River/Custer County mining project license this week:

Whoa—did you catch that part about ten companies expressing interest in mining the Black Hills for uranium? Jarding tells me that Powertech/Azarga's isn't just applying to mine; they want to build a processing plant that would have the capacity to process the uranium mined by subsequent entrants into the Black Hills mining game.

For opponents of uranium mining in the Black Hills, stopping Powertech/Azarga at this week's public comment session and evidentiary hearing becomes all the more important. Powertech is the tip of the uranium-iceberg. Let them in, and they are banking on other uranium miners to follow.

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Rickstock isn't the only political musical extravanganza taking place in the Black Hills this weekend. To warm up for the Nuclear Regulatory Commission's hearing on Powertech/Azarga's application to start an in-situ leach uranium mine in the southern Black Hills, Dakota Rural Action is hosting a pre-hearing concert and rally at the Allen Ranch near Hot Springs on Sunday:

  • Where: Allen Ranch, 13065 Fall River Road, Hot Springs, SD
  • When: Sunday, August 17, 5:00 to 8:00 p.m.
  • Who: Music featuring Australian Wayne Brennan, Open Mike Band, plus other local artists.
  • Whee! Camping! Stay overnight and attend the NRC public comment sessions the next day…to reserve a camp site, RV site, or tipi call 605-745-1890.

The Nuclear Regulatory Commission’s Atomic Safety and Licensing Board (ASLB) will take public input on Powertech/Azarga's application on Monday, August 18, from 11:00 a.m. to 2:00 p.m. and from 5:00 p.m. to 8:00 p.m. at the Mueller Civic Center, 801 S. 6th Street, Hot Springs, SD. Citizens may speak for up to five minutes on water, land, and historical/cultural concerns.

The ASLB then decamps to Rapid City for three days to hold its evidentiary hearing August 19-21 at the Alex Johnson Hotel, 523 6th St., from 9:00 a.m. to 5:00 p.m. We don't get to comment, but we can watch our neighbors make their case for protecting the Black Hills from more uranium mining.

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With the Nuclear Regulatory Commission coming to the Black Hills next week to hear public comment and consider evidence in the challenge to Powertech/Azarga's application for in-situ leach uranium mining in Fall River and Custer counties, Powertech watchdog Jim Woodward comes up with a couple of curious new developments:

  1. Back in May, Powertech bought some Tennessee Valley Authority data on over 4,000 boreholes and three aquifer pump tests that the TVA conducted in the Dewey-Burdock mining area in the 1970s and 1980s. Boreholes—i.e., paths through which water and pollution from in-situ leach mining could leak.
  2. That data could have some bearing on the contention of the Oglala Sioux Tribe and other official intervenors in the mining permit process that the final environmental impact statement on Powertech's proposal (completed before Powertech got that TVA data) lacks sufficient hydrogeological data on the impact ISL mining could have on the area. The data may also offer more perspective on more serious natural leakage at the site.
  3. The NRC told Powertech to show the tribe that data; Powertech is resisting that order, saying the TVA data is (in Woodward's words) "irrelevant to the evidentiary hearing."
  4. Even if the data is irrelevant, by balking at releasing the data up to this point, Powertech makes it difficult for opponents to see for themselves and study the data in time to effectively comment on it at the August 18 NRC hearing.
  5. And in business new that John Tsitrian will find interesting, Azarga was supposed to complete its reverse-takeover of Powertech by July 31. Azarga and Powertech have not completed that maneuver; instead they have extended the acquisition deadline to September 15.

Powertech uranium mining proposal, as well as its business arrangements with Azarga, are complicated. The public deserves as much data as possible to understand the risks and benefits. Powertech, help us out: let us see the TVA data.

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My friends at PowertechExposed.com are going to have to change their name. Hong Kong-based but British Virgin Islands-incorporated Azarga Resources is finalizing its takeover of the Canadian Powertech, the company that wants conduct in-situ leach mining for uranium in the southern Black Hills. Powertech will take on the new name Azarga Uranium Corp.

Technically, Powertech is acquiring Azarga. However, as Mark Watson and Adam Hurlburt reported on July 3, the deal looks much more like Azarga taking over Powertech. The structure of the deal is the typical dizzying shuffle of shares, debt, and tricky tax games. Jim Woodward reports that on June 30, Powertech shareholders voted to dilute their own ownership by issuing a big gob of new stocks that will make Australian businessmen Alex Molyneux and Curtis Church, and Singaporean investment firms Blumont Group Ltd. and Pacific Advisers Pte Ltd. the controlling shareholders. Molyneux is a key advisor to Blumont, which owns another British Virgin Islands company called Powerlite Ventures Limited, which holds the note on a loan of up to $26 million to Azarga, which debt Powertech/AUC now takes over via share conversion, which could make Powerlite/Blumont the majority stakeholder...

...which is all more than you may need to know if all you're worried about is stopping Powertech, Azarga, or anyone else from wrecking the Black Hills water supply, but which Powertech's shareholders and Canadian securities regulators might have wanted to know sooner:

When added to the 41 million Powertech/AUC shares already owned by Powerlite following the closing, Powerlite/Blumont could end up with a controlling stake of 51.7%. This possibility was not fully disclosed by Powertech in its May 13 meeting notice and information circular filed with Canadian securities regulators. This document is the primary source of information on the proposed transaction, and it is not clear why this potential change of control was not adequately disclosed [Jim Woodward, "Powertech Shareholders Approve Reverse Takeover by Australian and Singaporean Investors," PowertechExposed.com, 2014.07.20].

Powertech left out other information:

The Powertech information circular also does not discuss a current wide-ranging and unprecedented investigation of Blumont by Singapore’s white-collar police unit and central bank following a 95% drop in Blumont’s stock price in October 2013. Singapore police have requested three and a half years’ of corporate electronic data from the firm, as well as data storage devices belonging to Executive Director James Hong and Executive Chairman Neo Kim Hock in their probe of possible breaches of the Singapore Securities and Futures Act.

Also missing from the Powertech filing is any mention of Alex Molyneux’s role as a consultant and key advisor to Blumont’s board of directors, or his 2013 agreement, rescinded in April, to purchase 135 million shares of Blumont and become its Chairman [Woodward, 2014.07.20].

Rapid City businessman John Tsitrian has raised questions about Powertech/Azarga's exaggerations and omissions in statements to investors and securities regulators. This month's high-financial action makes Tsitrian all the more suspicious of this shaky deal and the shady characters casting their beady eyes on the Black Hills.

Perhaps the Nuclear Regulatory Commission, which takes public comment on the Powertech mining permit request August 18 in Hot Springs and holds an evidentiary hearing August 19–21 in Rapid City, should also be suspicious. Neither Powertech nor Azarga has ever received a permit to mine uranium. Molyneux is promoting a different mining technology called ablation. Adam Hurlburt raised the question last November of whether this change in ownership warrants a restart of the entire regulatory process:

It seems there’s a very real possibility the entity that drafted and submitted lengthy environmental reports, technical reports, economic impact reports, permit applications and more to the South Dakota Department of Environment and Natural Resources, the Environmental Protection Agency, and the Nuclear Regulatory Commission; the same entity that signed agreements with numerous private South Dakota landowners; the same entity that conducted several years of extensive research into the economic viability and safety of a proposed 17,800 acre in situ recovery mine set to pull roughly 8.4 million pounds of uranium out of the southern Black Hills over a nine year period; the same entity that’s assured the state of South Dakota and its citizens that it can do this successfully without adverse affects on the environment and its inhabitants may not be the same entity that actually does the mining, should all these permits be granted [Adam Hurlburt, "Who Are We Permitting?" Black Hills Pioneer, 2013.11.05].

Powertech assures us that the new owners will be bound by the same conditions set for Powertech by any previous permits. Woodward reports that a source says NRC staff aren't going to fret over the change in Powertech/Azarga control, even though no one at Azarga has experience with in-situ leach uranium mining.

Azarga appears not to know the specific mining activity for which it's seeking a permit, and its new property Powertech isn't doing a good job of informing investors and regulators of what's coming down the corporate pike. Those are two good reasons to be suspicious of the uranium mining these schemers are trying to bring to the Black Hills.

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Darned wasicu and their in-situ uranium mining....

The Clean Water Alliance is placing the following public service announcement on KOTA and KEVN television. But since TV is as bad for your brain as Powertech/Azarga's uranium mining will be for the Black Hills, why not watch it here on the Internet instead?

Chinese-Canadian Powertech/Azarga, whose big-money officers mostly live elsewhere and won't have to deal with the pollution they will leave in the Black Hills, face a public comment hearing hosted by the Nuclear Regulatory Commission in Hot Springs on Monday, August 18, followed by the NRC evidentiary hearing August 19–21 in Rapid City.

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Joe Lowe partisans take heart: the losing contender in our Democratic gubernatorial may have gotten through to nominee Rep. Susan Wismer on at least one issue. After weeks of awkward agnosticism, Rep. Wismer is working her way closer to saying Powertech's uranium mining plan for the Black Hills is a bad idea:

Rapid City Journal: An international firm has proposed to mine uranium near Edgemont, a project that supporters say will bring jobs and pad state coffers with tax revenue. But opponents worry the mine will harm the region's water supply. Do you support the project?

Susan Wismer: Unless and until I am completely assured that there would be no damage to the water, I can't see myself supporting it. The Legislature is surrounded with pro-uranium mining people, former legislators that are now there as lobbyists. So they are not hearing the same thing that is being heard out here. And it is just another symptom of our government, which is controlled by one party [Joe O'Sullivan, "Five Questions with Governor Candidate Susan Wismer," Rapid City Journal, 2014.06.09].

That answer is still wiggly. It leaves room for her to fall for those lobbyists' baloney. It shows that her study of the issue hasn't gotten around to the local press Lowe cited during the primary that said in situ leach mining always damages the water. And it doesn't explain her vote in 2011 to eliminate state oversight of uranium mining.

But Wismer's Powertech caution is better than the vague shrug she gave in May, and significantly more comforting to environmental sensibilities than Governor Daugaard's current absurd non-answer. Keep pushing, Black Hills water drinkers: we may get Wismer to take a stand against Powertech yet!

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