Proposed expansion would increase site from five acres to 75

HAMILTON - State and federal officials earlier this month reopened public comment on Stansbury Holding's proposed expansion of its vermiculite mine east of Dillon after area residents raised concerns about the project.

Dillon Vermiculite LLC is a wholly owned subsidiary of Stansbury. Dillon Vermiculite has leased the mine and mill to International Vermiculite Unlimited, of which Stansbury is a 50 percent owner.

The proposed expansion would increase the mill and mine site from five acres to 75 acres. If the state approves expansion, International Vermiculite would increase production levels of concentrated vermiculite from 30,000 tons per year to 100,000 tons per year.

The state drafted an environmental assessment of the project in 1999 that drew little public comment. The mine's owners have said there is no asbestos in the ore body, although the environmental assessment indicated that there were trace amounts of asbestos in samples collected from drill cores taken just outside the mine site.

However, recent news of health problems facing Libby residents from mining asbestos-laced vermiculite has raised new concern among Dillon residents who wanted the comment period reopened.

Because Stansbury hadn't submitted a required $258,000 reclamation bond for the expansion project, and the state had not yet issued an operating permit, the DEQ was able to reopen the comment period.

"In light of the current health investigation being conducted by federal and state agencies in Libby concerning the former W.R. Grace vermiculite mine and potential asbestos contamination, the DEQ believes it would be prudent to reexamine any potential for asbestiform fibers in the Elk Gulch ore deposit," the state Department of Environmental Quality said in a prepared statement.

In addition to renewed interest in the Dillon expansion project, the DEQ's enforcement division has proposed fining Stansbury $42,500 for allegedly violating its limited use permit at Dillon.

The state allowed Stansbury's mining operation at Dillon under Montana's small-miner's exclusion law and permitted the company to mine up to five acres. Last fall, state officials learned Stansbury had increased the disturbance area to 16 acres, said Warren McCullough, DEQ environmental management bureau chief.

The department gave the company until December 1999 to reclaim the area or post a $64,000 reclamation bond. When no bond was received by that deadline, the fine was proposed, McCullough said.

Stansbury posted the bond in February and is now contesting the fine. Coffman said the company improved an access road approaching the mill and mine site. He argued it posed no risk to public health or safety. On the contrary, Coffman said, the road substantially improved safety and health.

Coffman contends the $42,500 fine is excessive, especially since the work improved safety, he said. He contrasted the fine with a recent $95,000 fine imposed by the Occupational Safety and Health Administration on Louisiana-Pacific Corp. for failing to do anything about known fire and explosion hazards at the company's waferboard plant in Olathe, Colo. The hazards were blamed for a blast that killed one worker and injured another last October.

McCullough said Stansbury has failed to follow procedure on several occasions.

"They've done things they weren't supposed to do and haven't done things they are required to do," he said.

"Regardless of what Stansbury shows on its Web site, they won't be mining vermiculite on a large scale any time soon (at Dillon)," McCullough said. "They are still restricted to the five-acre area."

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