Earth Protect Blog

Company wants to extract gold, silver from waste; locals skeptical, alarmed



By Elise Schmelzer

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LEADVILLE>> Millions of tons of waste from decades-old mining operations sit in the hills east of town. The brown and orange piles of abandoned ore rise 30 feet, peeking over the pines.

A company in Leadville wants to truck 1.2 million tons of the waste to a mill on the southwestern edge of the high mountain city, use cyanide to extract gold and silver from the rocks, and then return the hills to a more natural state. CJK Milling says its proposed operation would be “one of the largest, most innovative environmental cleanups of abandoned mine waste” in Leadville — and a model for other historic mining areas.

But the company’s proposal has prompted skepticism and alarm in Leadville, with some locals opposing the additional trucks the project would put on roads in the area. Others fear the use of toxic cyanide — up to 600 pounds a day — so close to town and the Arkansas River. They worry about the project’s potential impacts on soil, water and air quality.

The proposal has also raised a broader question: What is the future of mining in a town that once relied on it but has cultivated a new identity as a high-altitude hub for tourism and recreation?

“I had a lot of mixed feelings about the project,” Mayor Dana Greene said. “I had the question, too, that we’re a historic mining town, so why wouldn’t we embrace this? For me, my concerns are the effects to the sense of place and the potential long-term effects on the area.”

Company leaders, however, say their project is not a mining operation — and instead is focused on removing the waste piles and returning the land they sit on to its natural state. The project could be an example of profitable, privately funded cleanup of mining waste, said Nick Michael of CJK Milling.The milling facility is designed in a way that ensures neither cyanide nor other byproducts of the process can escape its confines, Michael said.

“This isn’t a ruse to do mining. This is remediation,” he said.

Harvesting gold and silver from waste

CJK Milling owns 1.2 million tons of mining waste in California Gulch and is seeking state permits to process its first third of the waste.

The company plans to scrape up piles of waste from more than a century of mining activity in the hills above Leadville, which are part of a federal Superfund site. The California Gulch Superfund Site, designated in 1983, covers 18 square miles of Leadville and surrounding areas, including a section of the Arkansas River.

Much of the site is considered remediated by the U.S. Environmental Protection Agency, though the area where CJK Milling would operate is not.

CJK Milling plans to transport waste on trucks from the piles through a small corner of town, then onto a section of U.S. 24 to reach its mill across the highway from Lake County’s airport. The waste then will be smashed and treated in a vat with a cyanide solution to dissolve the gold and silver from the rock.

The company will make bars of the precious metals. The leftover sediment will be stored in a lined tailings deposit on the mill property after the cyanide has been removed from the waste.

The mill is expected to process 400 tons of ore a day. Michael and CJK Milling owner Gary Knippa wouldn’t say how much gold they expect to produce from that ore.

The system surrounding the facility is designed to capture any material in the event of an equipment failure or disaster, Michael said. The storage pits are double-lined and include a leak detection system. The cyanide will be trucked into town, likely from the south, in the form of dry pellets, he said.

“Even if there was some catastrophic event and every system failed, (the cyanide) doesn’t have anywhere to go,” Michael said.

When the company is done milling, it plans to cap the 8-acre tailings pile and plant trees and vegetation on top.

“Once we’re up and running,” Michael said, “the average person won’t notice us.”

But the idea of increased truck traffic and tons of cyanide being used just on the outskirts of town — and a few hundred yards from a tributary to the Arkansas River — concerns some Leadville residents and leaders.

A group organized to fight the project, Concerned Citizens for Lake County, has submitted hundreds of opposing comments to the state Division of Reclamation, Mining and Safety, which is overseeing the project’s permitting process.

“We’re not opposed to responsible industrial development, but this is not responsible,” group member Ruth Goltzer said. Goltzer noted the group doesn’t oppose the mammoth Climax molybdenum mine on Fremont Pass or another project by CJK Milling.

The new plan, however, has members concerned about the use of cyanide and the potential impacts if it were to seep into the water supply or soil, despite the company’s assurances that such contamination is not possible.

Official: Cyanide is “red herring”

Cyanide is commonly used in gold operations around the world, Michael said. The company would consider alternative processes that don’t require the chemical, but cyanide extraction is the only method that works to extract gold and silver from the waste piles.

“I think the issue with cyanide is ignorance,” he said. “It’s a red herring.”

Corby Anderson, a professor of mining engineering and metallurgical and materials engineering at the Colorado School of Mines, said people have many misconceptions about cyanide, which is naturally occurring and can be found in foods like spinach and lima beans. Cyanide breaks down easily and, if exposed to air and sunlight, would decompose in days or weeks, he said.

“If you manage the risk, you don’t create a hazard,” Anderson said.

Just one other company uses cyanide extraction in Colorado, according to the Division of Reclamation, Mining and Safety. The Cripple Creek and Victor Gold Mine in Teller County sprays cyanide over piles of crushed ore and collects the liquid that runs off — a process called “heap leaching.”

The division has approved other operations to use cyanide but none ever used it, division spokesman Chris Arend said.

The Teller County mining operation has had a few accidental releases of cyanide solution over time, but all have been reported and no spill has ever left the site, Arend said. CJK Milling’s proposal, which does not use of heap leaching, would contain the cyanide solution to vats.

Another heap leaching operation became one of the state’s most toxic Superfund sites. Outside Del Norte, the Summitville Mine started leaking potassium cyanide into nearby streams after it ceased operation in 1992. The cyanide solution, combined with toxic runoff from the site’s open pit mine, wiped out aquatic life on miles of a fork of the Alamosa River, prompting a multidecade cleanup effort that cost hundreds of millions of dollars.

Residents in Leadville or downstream on the Arkansas River have concerns other than cyanide.

Greene, the Leadville mayor, worries about potential impacts decades after operations stop. After touring the site, she said she no longer was troubled about the use of cyanide, as long as it is used as planned. But she was still concerned about the possibility the linings of the tailings deposit could break down, along with the effects of moving the waste piles from where they’ve sat for decades.

If the mill were farther from town or the river, she said, the plan would be more palatable to her.

“I think they have a reasonable plan to consider, and as a city we need to be sensitive to and enthusiastic about economic development. But we shouldn’t be doing that with a blank check,” Greene said.

“It’s a question of, do we trust them?”

Chris Lamson, president of the Collegiate Peaks Chapter of Trout Unlimited, also has concerns about moving the waste piles, which could become more susceptible to wind and water disturbances during excavation. But talking to the company and touring the facility has calmed many of his fears about the potential impacts to the Arkansas River and its fisheries.

“It’s a question of, do we trust them?” Lamson said. “It’s an honor system, which seems inherent in many mining projects.”

The milling project will create approximately 21 jobs, according to CJK Milling. Neither Knippa nor Michael live in Leadville, but they say they are willing to give tours or answer questions from anyone in the community.

For Goltzer and other members of Concerned Citizens for Lake County, the potential risks outweigh the benefits.

“Who is getting the benefit from this, and who is taking all the risk?” Goltzer said.

CJK Milling still needs a series of permits to begin operation. Its February application for a permit from the state’s Division of Reclamation, Mining and Safety is under review, division director Michael Cunningham said. The ultimate decision rests with the Mined Land Reclamation Board after it hears public comment.

Then the company would need air and stormwater permits from the Colorado Department of Public Health and Environment, a conditional use permit from Lake County and eventual sign-off by the county commissioners.

Cunningham said the permitting process for an operation that uses cyanide is the strictest under the state division’s purview, in part because of the Summitville Mine disaster. If CJK Milling wins approval, it will need to regularly test water samples and allow for inspections, he said.

Pending all those approvals, Michael and Knippa plan to start operating in the spring of 2025.