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ELY, Minn. (AP) — On a warm fall day, in a clearing cut into the evergreen and birch forest, a drill rig roars as it bores deep into northeastern Minnesota bedrock. Nearby, three men in hardhats keep close watch as the machinery slowly extracts samples more than 3,800 feet down from an ancient deposit that holds copper, nickel, platinum and other valuable metals.

Two executives looking on from Twin Metals Minnesota LLC say the project heralds a new era in mining for Minnesota. It promises “hundreds of jobs, if not thousands of jobs” in a struggling region, said Bob McFarlin, vice president of public and governmental affairs. He described the mineral reserves as “vast, world class, possibly among the largest untapped nickel and copper resources in the world.”

But the site is near a jewel of the North Country, the Boundary Waters Canoe Area, some 1 million acres of pristine wilderness that draws 250,000 visitors a year from around the world. And that worries environmentalists, residents and people in tourism who fear northern Minnesota’s mining rebirth will send noxious chemicals into lakes and streams that flow into the BWCA or Lake Superior.

Sipping iced tea on the balcony of a coffee shop overlooking Ely’s main drag, Mayor Roger Skraba shows off a coaster made of nearly pure copper extracted from another nearby test area. In a shrinking community dotted with empty storefronts, and with some residents working two and three jobs to get by, there’s no doubt where Skraba stands.

“If it’s not this generation, then it’ll be another generation, or another generation getting the minerals out of the ground. It’s gonna happen,” Skraba said. “My community needs something `cause it’s dying.”

Ely sits on the Vermilion Iron Range, where the last iron mine closed in 1967. Good-paying mining jobs were once the backbone of the local economy, but the town now depends on tourism, logging and call centers.

Minnesota’s iron mining history dates to the late 1800s when the first mines opened on the Vermilion Range and on the nearby and bigger Mesabi Range. People from 43 ethnic groups settled the region to work the mines. Pam Brunfelt, an Iron Range historian at Vermilion Community College, said it’s no exaggeration to say Minnesota iron helped make the U.S. the world power that it is today. Minnesota ore became the steel that became the skyscrapers of New York, Chicago and other great cities, she said, and gave America the steel it needed to win World War II.

When the high-grade ore ran out after the war, the University of Minnesota helped develop a process for separating iron from a low-grade ore called taconite that saved the state’s mining industry. The mighty Mesabi remains the country’s largest domestic source of iron ore, accounting for about 70 percent of the nation’s supply with at least two centuries’ worth still in the ground, Brunfelt said.

But iron has meant a boom-and-bust regional economy that mirrors world steel markets. In the 1980s, the region lost 10,000 mining jobs that have never returned, Brunfelt said.

“So people up here are torn about this supposed boom in mining nonferrous metals, because the population has declined here and we want people to know about this special place. On the other hand our water is very, very precious. We don’t know what to do about this,” Brunfelt said.

Geologists have known since the 1960s about the copper, nickel and platinum group metals underneath parts of northeastern Minnesota in what’s known as the Duluth Complex. But it’s only in the last few years that new extraction technologies and high world market prices have made it practical to go after it.

The reason copper-nickel mining has become such a flashpoint is that, unlike comparatively inert iron ore, these metals are locked up in sulfur-bearing minerals that can leach sulfuric acid and other pollutants when exposed to air and rain. Sulfide mining elsewhere has led to one environmental disaster after another, opponents say.

“Based on the track record of this type of mining, it just seems incredibly risky to put it next door to the Boundary Waters, the nation’s most popular wilderness area, and a very ecologically sensitive area filled with rivers, lakes and wetlands,” said Greg Seitz, a spokesman for the Friends of the Boundary Waters Wilderness.

McFarlin said the Twin Metals project will be different because it will use modern mining practices and technologies, including cleaner ways of separating the metals from the ore. The state will also require mining companies to set money aside to cover future cleanup costs.

“They’re very legitimate concerns,” McFarlin said. “We don’t dismiss them and we know we can address them.”

Such claims have won over some key political leaders and many residents who see revival in the Twin Metals project and in one planned by PolyMet Corp. for about 25 miles to the southwest in Hoyt Lakes.

Yet not only are some residents in the greater Ely region alarmed by the long-term environmental risks, they’re becoming increasingly vocal about the more immediate loss of peace and quiet from exploratory drilling.

The Stony River Township Board, which governs over 500 sparsely populated square miles of forest southeast of Ely, voted last month to ask the state and federal governments for a moratorium on copper-nickel mining and prospecting in their area. And area landowners this month won a six-month delay from the state in the issuance of new mineral exploration leases in the area. Last week, the Eagles Nest Township Board, which represents an area west of Ely, officially welcomed the postponement and issued its own call for a moratorium on mining and prospecting.

That reprieve came as a relief to Andy Fisher, who has heard drill rigs coming closer to the two small resorts he co-owns southeast of Ely. Sitting at a picnic table under the pines at his National Forest Lodge on Lake Gegoka, Fisher said he fears the noise from prospecting and the impact of mining could kill tourism in the area. He said his customers want to experience the beauty and solitude of nature and see moose and wolves.

“You can’t really replace a lake. You can’t really replace a forest. You can’t replace the fish that are going to die,” Fisher said.

Mining supporters point out that the U.S. has no operating mines for nickel, which is used to make stainless steel and alloys that go into jet engines. They also say the U.S. is heavily dependent on foreign sources of platinum and related metals like palladium, which make catalytic converters work.

The world’s demand for those metals is what’s drawn the interest of the investors behind Twin Metals, PolyMet and several other companies prospecting in northeastern Minnesota. PolyMet’s proposed NorthMet mine would be an open pit near Hoyt Lakes on the eastern end of the Mesabi Range. It’s farther along in the planning stages than Twin Metals. But the federal Environmental Protection Agency sent PolyMet back to the drawing board last year when it deemed the project’s environmental impact statement inadequate; Polymet says it plans to submit its revised version in January.

Any mining is at least several years off for either project. A key difference between them is that Twin Metals envisions an underground mine. It would sit near the Kawishiwi River, which flows out of the Boundary Waters into Birch Lake and back into the BWCA. Twin Metals is operating six drill rigs in the area to create a three-dimensional map of the deposits.

Jane and Steve Koschak, whose River Point Resort sits where the Kawishiswi enters Birch Lake, consider it an imminent threat. Standing on the shoreline, they pointed across the crystalline river toward where the mine would go, somewhere on the other side of the treeline, where the birch and aspen were turning orange and yellow against a backdrop of pines. They said they’ve endured the roar of drill rigs since 2006, including a couple years ago when one prospecting company set up a rig on a barge out on the lake.

They argue that the tourism industry deserves consideration, too, for its economic contributions to the state and region. River Point has been in his family since 1944. They said regular guests from as far away as Thailand come to enjoy the views across the water, the peace and quiet, the walleye fishing and the easy canoe access to the wilderness. On this day, at least, any drilling was out of earshot.

“The stillness is deafening, and to put something like that in the heart of this stillness and quiet is definitely disturbing — very disturbing,” Jane Koschak said.

(© Copyright 2011 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

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