Gold, silver mining stays cyanide-free

Montana State Roundup

Published January 1, 2005  | January 2005 issue

In November, Montana voters, by a 58 percent to 42 percent margin, upheld a ban on cyanide leach mining, rejecting an industry-backed initiative to repeal it. Supporters of Initiative 147 said it would promote investment in a struggling industry and create well-paying jobs. The measure called for environmental safeguards to keep cyanide used to extract gold and silver from low-grade ore out of lakes, streams and groundwater. Opponents countered that the risk of catastrophic water pollution outweighed potential economic gain for the state.

Virtually all the financial backing for I-147 came from Canyon Resources Corp., a Colorado-based firm whose plans to develop a gold mine in western Montana were scuttled when the ban was passed six years ago. The company sued the state in 2000, alleging that the ban led to an estimated $500 million in lost profits. Canyon has appealed the case to the state Supreme Court.

The day after the initiative failed, Canyon Resources President Dick De Voto told investors that the company is pushing ahead with plans to open a gold mine near Lincoln and the Blackfoot River. The proposed McDonald Gold Project may hold 10.9 million ounces of gold worth about $4.5 billion if it were all processed. De Voto said that Canyon Resources is exploring alternative, cyanide-free methods of mining gold.

Phil Davies