February 2022 Newsletter
February 16, 2022
Dear WRPC Member and Friends of the Menominee River,
This year marks the 40th anniversary of the founding of the Wisconsin Resources Protection Council in Medford, Wisconsin in 1982. The major concern of WPRC was the lack of information about the effects of large-scale metallic sulfide mining on our state’s precious water supplies, on the tourism and dairy industries, and upon the many Native American communities that are located near potential mine sites.
Building a Native and Environmental Alliance
There were several sulfide mine projects proposed at that time, including the Flambeau mine in Rusk County, the Lynn mine in Oneida County and the Crandon mine next to the Mole Lake Sokaogon Chippewa reservation in Forest County. WRPC has always emphasized the integral connection between the threat to our clean waters from metallic sulfide mining and the cultural threat to the Native American Nations who depend on clean air and water for the continuation of their cultures. Whether it is the threat to Mole Lake’s wild rice lake or the threat to the Menominee River and the homeland of the Menominee Indian Tribe of Wisconsin, we have tried to build understanding and mutual support between Native and non-Native communities who depend upon a shared resource.
Among the notable successes of WRPC’s alliance building in defense of clean water is the defeat of Exxon’s proposed Crandon metallic sulfide mine at the headwaters of the Wolf River in 2003. The proposed mine site is now a conservation area jointly managed by the Mole Lake Sokaogon Chippewa and the Forest County Potawatomi Tribes. Other successes can be found on the WRPC website: www.wrpc.net
Facing bankruptcy and loss of its wetland permit, Aquila is acquired by Gold Resource Corp.
On September 7, 2021, Aquila announced its acquisition by the Denver-based Gold Resource Corporation (GORO). Soon afterwards, GORO’s stock price was down 32.7%. According to a January 24, 2022 analysis in Seeking Alpha, an investment newsletter, the acquisition “may have been the primary reason, but it is still something we can always debate. The matter is that GORO has been a poor investment…”
GORO has one operating mine, the Don David Gold Mine in the Mexican state of Oaxaca. It acquired the Back Forty Project for the stated purpose of moving from “a one-mine company to a two mine company with jurisdictional diversification.” In February 2018 the Mexican federal environmental agency (Profepa) fined GORO’s Don David Gold Mine over $500,000 for operating without the necessary permits. The mine had also failed to comply with air quality emission regulations (Mexico News Daily, February 9, 2018).
Investor confidence is still the Achilles heel of the Back Forty Project
When the mine permits Aquila Resources needed to begin mining were either overturned, withdrawn or rendered obsolete because the mine plans had changed, the outside investors cut off further investment in the project. Aquila had spent over $100 million on the project but had nothing to show for it. Now GORO may submit “an omnibus application” for all five required project permits in the second half of 2022. Prior to this, GORO needs to complete an economic feasibility study for the Back Forty Project to attract outside investors in the project. With a year- end cash balance of $34 million, GORO cannot proceed with an expedited permit application schedule without a massive infusion of cash.
“A Call to Action” to let investors know that this project has no social license to operate
The Coalition to SAVE the Menominee River has a “Call to Action” button on its webpage –(www.jointherivercoalition.org ) that says “Submit Letter to GORO/H.C. Wainwright” that will let investors in the Back Forty Project know that “they face substantial financial risks due to the longstanding and well organized opposition” to the proposed mine. H.C. Wainwright is the investment company raising funds for the Back Forty Project. Over 100 letters have already been sent to Ann Wilkinson, Vice President, Investor Relations and Corporate Affairs for GORO.
A recent survey by Ernst & Young Mining & Metals found that more than half of global mining companies believe that a social license to operate, or community support is as important, if not more so than a regulatory license. Losing social support is the biggest risk to their business – jumping seven places up the list from last year.
Key Executive Leaves GORO
Ann Wilkinson informed the Coalition that her last day with GORO was January 31, 2022, after just over one year with the company. Ms. Wilkinson was one of four key executives at the firm. No reason was given for her departure. The timing of her announcement and the takeover of her duties by GORO President and CEO, Allen Palmiere, suggests that this was an unexpected resignation, because GORO didn’t have time to hire a new investor relations specialist, so the job was diverted to someone who already had overwhelming responsibilities for the company.
Save the date: 2nd Annual Water Celebration at Stephenson Island next to the Menominee River
Over 300 people attended the July 16, 2021 Water Celebration on Stephenson Island. The Coalition is planning for an even higher turnout in 2022 – see enclosed flyer. “Be assured,” said Coalition co-founder Dale Burie, “that this battle has gone on for 20 years and will continue to go on until these speculative mining organizations give up on ever getting close to the Menominee River.”
Stay tuned,
Al Gedicks, Executive Secretary