Wisconsin Resources Protection Council

April 29, 2019

Wisconsin Resources Protection Council
Box 263
Tomahawk, WI 54487

Mr. Oskar Lewnowski, CIO
Orion Mine Finance Group
7 Bryant Park
1045 Avenue of the Americas
Floor 25
New York, NY 10018

Dear Mr. Lewnowski

We are once again writing in regard to Orion’s 14 % ownership of Aquila Resources’ Back Forty metallic sulfide deposit in Michigan’s Upper Peninsula. Aquila’s President and CEO, Barry Hildred, has stated that Aquila has received all State and Federal permissions required for construction and commencement of operations at the Back Forty Project. This is inaccurate and highly misleading.

Instead of moving forward, the Michigan Department of Environmental Quality (MDEQ) has determined that because the project footprint has expanded by 200 acres, including the enlargement of the tailings and waste rock structures, Aquila was required to submit a Mining Permit Amendment Application (MPAA) and an associated Environmental Impact Assessment Amendment (EIAA).

On January 9, 2019, the MDEQ held a public hearing on the amended permit application at the Stephenson High School. Despite the short notice of the hearing and the 900-page permit, over 50 people provided specific technical objections to the permit. Many speakers testified to the unsafe design of the tailings storage facility and the serious risks to people and water quality from a catastrophic dam failure and the release of toxic wastes into the Menominee River. No one spoke in favor of the project.

Shortly after the public hearing the tailings dam in Brumadinho, in southeastern Brazil failed, releasing almost 3 billion gallons of sludgy mine waste, killing over 200 people with an estimated 91 others still missing and presumed buried under mud. The same upstream design for storing mine waste is now being proposed for the Back Forty’s tailings dam next to the Menominee River. About 76% of tailings dam failures worldwide are related to upstream construction methods.

A steady stream of letters to the editor of the Eagle Herald in Menominee, MI and Marinette, WI have expressed serious public concerns about the safety of Aquila’s tailings dam design. The 27 letters to the editor enclosed in this packet, cover the period from May 2018 to April 2019 and cover a wide range of concerns about the Back Forty project, from water quality, acid mine drainage, safe drinking water, unproven mine technology, negative economic impacts, the lack of transparency in Aquila’s communications, and the risk of catastrophic failure from the proposed tailings dam. These letters should be of concern to any investor who understands the financial risks of proceeding with a mining project that lacks a social license to operate.

Aquila has responded to public concerns over the safety of its proposed tailings dam design with a full-page ad in the March 2, 2019 edition of the Eagle Herald and with a mailing about their tailings management facility (TMF) to the residents of Menominee County. Aquila’s ad never mentions the Brazilian tailings dam disaster of January 25, 2019 or that the government of Brazil has banned the use of the upstream dam design from further use and ordered the dismantling of 88 existing upstream tailings dams.

Chantae Lessard, Aquila’s Director of Social Performance and Engagement has assured the public that the Back Forty project follows “industry best practices.” This is yet another misleading claim.

Contrary to Aquila’s claim that the tailings from the Back Forty processing plant will resemble “thick drywall mud,” the tailings will be 19 percent water when they are pumped into the TMF. The industry best practice is for tailings to be thoroughly dewatered and stored in “dry stacks” with a lower moisture content, according to an expert panel that investigated the 2014 Mount Polley tailings dam failure in British Columbia, Canada. Mount Polley was the largest environmental disaster in Canada’s mining history.

Using tailings with relatively high moisture content to save costs increases the risk that tailings will liquefy and cause the tailings dam to fail. If Aquila were truly concerned with minimizing the known risks of upstream tailings dam they would have chosen the dry stack option. Aquila’s claims in a paid ad and their mass mailing are not consistent with their own mine permit application, with the scientific literature on tailings dam construction, and the mining industry’s own reevaluation of this technology. “We absolutely agree that a fundamental change is required in the industry’s collective approach to safe tailings management,” according to Andrew Mackenzie, chief executive of BHP, the world’s largest mining company.

All of these concerns will be aired at an upcoming MDEQ public hearing on Aquila’s dam safety permit and their air use permit. Aquila’s wetland permit is being challenged in a contested case hearing in the state of Michigan by the Coalition to SAVE the Menominee River and by the Menominee Indian Tribe of Wisconsin. The wetland permit is also being contested in federal court.

Aquila’s false and misleading claims about its proposed tailings dam next to the Menominee River have only increased public opposition to this environmental disaster waiting to happen. The list of environmental, tribal, sportfishing and faith-based organizations that have co-signed this letter attest to one of the most broad-based opposition movements opposed to a mining project in recent Michigan and Wisconsin history. Your investors should take note of the financial risks of continued investment in such a project.

Sincerely,

Al Gedicks, Wisconsin Resources Protection Council, Tomahawk, WI

Guy Anahkwet Reiter, Menikanehkem (Community Rebuilders), Keshena, WI

Ron Henriksen, Front 40 Environmental Fight, Stephenson, MI

Dale Burie, Coalition to SAVE the Menominee River, Wausaukee, WI

Jane A. Tan Eyck, Chippewa Ottawa Resource Authority, Sault Ste. Marie, MI

Tom Goldtooth, Indigenous Environmental Network, Bemidji, MN

Judith Le Blanc, Native Organizers Alliance, Seattle, WA

Horst Schmidt, Upper Peninsula Environmental Coalition, Houghton, MI

Dean Hoegger, Clean Water Action Council of Northeast Wisconsin, Green Bay, WI

Seth Hoffmeister, Wisconsin Conservation Voters, Green Bay, WI

John Engel, Sierra Club, John Muir Chapter, Madison, WI

Raj Shukla, River Alliance of Wisconsin, Madison, WI

Dace Zeps, Wisconsin Network for Peace, Justice and Sustainability, Madison WI

Cheryl Kallio, Freshwater Future, Petoskey, MI

Aaron Mintzes, Earthworks, Washington, DC

Babette Grunow, Midwest Coalition Against Lethal Mining, Milwaukee, WI

Sarah Juon and Karl Fate, Oneida County Clean Waters Action, Rhinelander, WI

Dr. Shannon Sloan-Spice, Water Protectors of Milwaukee, WI

John Peck, Family Farm Defenders, Madison, WI

Lori Andresen, Save Our Sky Blue Waters, Duluth, MN

Le Roger Lind, Save Lake Superior Association, Two Harbors, MN

Paul Cienfuegos, Community Rights US, Portland, OR

Laura Gauger, Deer Tail Scientific, Duluth, MN

Jerry Pasdo, Wisconsin Smallmouth Alliance, Madison, WI

Dick Dragiewicz, Northern Illinois Fly Tyers, Northbrook, IL

Bob Harrison, Badger Fly Fishers, Madison, WI

Bob Becker, Lee Wulff Trout Unlimited Chapter, West Dundee, IL

Marc Rosenthal, Madison Arcatao Sister City Project, Madison, WI

Toni Harris OP, Prioress, Sinsinawa Dominican Sisters, Sinsinawa, WI

Rev. Willie E. Brisco and David Liners, WISDOM, Milwaukee, WI

Timothy Cordon, First Unitarian Society Social Justice Ministry, Madison, WI

Tamerin Hayward and Linda Boyle, Racine Interfaith Coalition, Racine, WI

Sara Williams, JOSHUA Leadership Team, Green Bay, WI

William Van Lopik, ESTHER, Appleton, WI

Sandra McKinney, JONAH, Eau Claire, WI