US legislators propose reforms to 1872 mining law to raise royalties

10 July 2014 (Last Updated July 10th, 2014 18:30)

Twenty US legislators have introduced a bill in the House of Representatives seeking reforms to the General Mining Act of 1872 to make the mining companies pay more royalties.

Twenty US legislators have introduced a bill in the House of Representatives seeking reforms to the General Mining Act of 1872 to make the mining companies pay more royalties.

The bill proposes to charge mining companies a royalty of 8% on new mines and 4% on the existing properties for mining on public land.

The bill has been introduced by the US House of Representatives natural resources committee member Peter DeFazio (OR-4) and subcommittee on public lands and environmental regulation member Raul Grijalva.

"My legislation will ensure the mining industry pays its fair share, meets modern environmental standards, and addresses its legacy of contamination throughout the west."

DeFazio said: "For over 140 years, the federal government has allowed mining companies to extract hundreds of billions of dollars' worth of valuable publically owned minerals from our public lands without paying American taxpayers a single dime.

"Adding insult to injury, the current law has allowed these mining companies-many of them foreign owned-to carve up our lands and abandon the toxic, hazardous mess for taxpayers to clean up.

"My legislation will ensure the mining industry pays its fair share, meets modern environmental standards, and addresses its legacy of contamination throughout the west."

The legislators propose to use the money raised through royalties to clean-up abandoned hardrock mine lands, which is estimated to cost about $72bn.

According to a study released by DeFazio, 46 of the leading mines produced minerals worth about $9.6bn in the last two years from federally controlled land, without paying any royalty.

A Democrat Committee report estimates that the passage of the law would have made 46 top hardrock mining companies, including 22 foreign-owned, to pay $380m in royalties in 2012 and 2013.

Energy