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Mining Company To Pay $10.3M For South Dakota Cleanup

The settlement will cover part of environmental cleanup costs at an abandoned gold and silver mine heavily contaminated with hazardous substances.

Mnet 72191 Epa

A Colorado mining company will pay $10.3 million to the state of South Dakota and the federal government to cover part of environmental cleanup costs at an abandoned gold and silver mine in the northern Black Hills, a federal agency said Friday.

The Environmental Protection Agency said a settlement agreement was filed in U.S. District Court in the case against Coca Mines Inc. and its former chief executive, Thomas E. Congdon. The EPA and the state contend that the Gilt Edge Mine Superfund site is heavily contaminated from mining activities involving hazardous substances including arsenic, cadmium, chromium, copper, lead, manganese, nickel and zinc.

"We are pleased with this agreement and the compensation for the damage to the environment that it represents," Shaun McGrath, EPA's regional administrator in Denver, said in a statement.

The amount of the settlement falls far short of the likely total costs of cleaning up the site, which the EPA estimates at more than $200 million, though the area has been disturbed by mining and mineral processing operations since the late 1800s.

The lawsuit, which was originally filed Thursday, said Congdon signed a lease to mine roughly 1,352 acres at the site in 1974, and a partnership he formed eventually became Coca Mines Inc. A telephone message left for Congdon was not immediately returned.

Under the agreement, neither Coca Mines Inc. nor Congdon acknowledge any liability. Of the settlement amount, $9.27 million will go into an EPA account to fund future environmental actions and $1.03 million will go to the state, according to court documents.

The 360-acre Gilt Edge Mine site is located east of Lead, South Dakota, and includes a former open pit and a cyanide heap-leach gold mine. The site had been used for hard rock mining since the late 1800s and has been extensively disturbed by mining and mineral processing operations.

The agency and South Dakota previously entered into settlements with other former mine operators, recovering more than $30 million to fund cleanup efforts.

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