March 4, 2024

Chantelle Dunbar-Jones remembers when her hometown of Lewisville, Arkansas, seemed to have oil wells on every corner. The small town, located in the southwestern part of the state, sits atop the Smackover Oil Formation, one of the largest oil fields in the United States. For a long time almost everyone worked for the oil industry. Dunbar-Jones’ father started with Phillips 66, but was relegated to smaller and smaller companies as wells began to close in the late 1990s and the industry moved to Texas. In the years since, the town has seen residents and businesses leave in pursuit of a better future.

The area’s fortunes began to look up late last year, when ExxonMobil, along with a few other companies, announced its intention to begin producing lithium in the region by 2027. It opened a test site on the Smackover formation, which spans three states and can provide 15 percent of the world’s lithium. That has people in Lewisville cautiously hopeful that the change could turn things around.

“We’re just really excited and trying to get all our ducks in a row and take advantage of what’s coming,” said Dunbar-Jones, who has served on the city council for seven years.

ExxonMobil is joining a growing rush to provide the natural resources needed to drive the green transition. Oil producers and coal companies like Ramaco Resources want to work with the Department of Energy to strip them and, in some cases, wring more money from land they already own.

Lithium and other minerals such as cobalt, nickel and silicon are essential for the production of solar panels, wind turbines and the batteries that power electric vehicles. At present, the vast majority of these critical minerals come from Argentina, Australia, Chile, China, and the Democratic Republic of the Congo. There is only one rare-earth element and one lithium mine in the US, and the Biden administration has more than $407 million available for domestic exploration and production through the Inflation Reduction Act. This influx exacerbates the effect of other investments at various links in the domestic clean energy supply chain. These subsidies have made cashing in on the green transition attractive to fossil fuel companies, many of which have access to potentially productive land and the experience and equipment to exploit it. In places known for their reserves of oil and coal, such as the Powder River Basin of Wyoming and southern Arkansas, fossil fuel companies are tapping into newly discovered stores of critical minerals. This has left some people excited by the promise of economic revival and others nervous that they will be revisited by all the worst social and environmental impacts of fossil fuel extraction.

Dunbar-Jones, so far, sees little cause for concern. Mostly, Exxon’s announcement, along with similar announcements from companies like Standard Lithium, feels like a good excuse to attract Lewisville and work with surrounding towns to open up the region for business. She was told that the area could see hundreds of new jobs. “We’re losing people to lack of adequate housing, lack of adequate jobs,” she said. “Now that lithium is coming, everyone is trying to come back.”

The land around the Smackover oil formation remains scars through years of eager and often poorly planned petroleum extraction, its streams contaminated by oil and brine. Exxon and other companies looking for lithium have participated in public meetings where they have dismissed environmental concerns, Dunbar-Jones said, declaring that their methods are safe and environmentally sound. But she still wonders.

“How can you really know before they come in and start?” she asked.

ExxonMobil did not respond to a request for comment, but in a statement announcing the lithium project, it said the process by which it will mine the lithium is safe and produces fewer carbon emissions than hard rock mining and requires significantly less land.

Mining of critical minerals is subject to a relatively loose framework of regulations, and it can be quite destructive, said Marco Tedesco, a climate scientist at Columbia University who has researched their mining worldwide. To exploit the Smackover formation, Exxon plans to tap the lithium-rich brine 10,000 feet underground using a process called deep lithium extraction. “They pump lithium from the bottom — similar to fracking,” Tedesco said, adding that the process requires a tremendous amount of water. The brine evaporates, leaving behind lithium salts and other byproducts, some valuable and some toxic. “People who live near a mine, they have the right to exploit this economic opportunity,” he said, but in practice, Tedesco sees most of the benefits in leaving the communities where mining takes place.

“Unfortunately, history is littered with a systematic disregard for transparency and a lack of accountability by corporations,” Tedesco said.

Water scarcity is a big topic in Wyoming, a cold, dry state with sprawling strip mines, intensive fracking and a growing industry in critical minerals. Coal has been tied to the identity of Gillette, a small town in the northeastern corner of the state, for more than 100 years. The Powder River Basin holds most of the nation’s recoverable reserves. Coal company Ramaco Resources, with the help of a Department of Energy national laboratory, has discovered what could be the nation’s largest deposit of rare earth metals on land it bought in 2011 for $2 million. Rather than digging for coal, Ramaco will tap what it says will be a $37 billion bonanza in critical minerals.

Shannon Anderson, the staff attorney for the environmental organization Powder River Basin Resource Council, sees nothing unusual in what Ramaco is doing. “Companies are really good at reinventing themselves when there’s a market opportunity to do that,” she said, and the mining industry has been eager to join the clean energy supply chain. Research has shown that mine tailings, acid mine drainage and other toxic coal wastes are actually a decent source of critical minerals. Despite his opposition to many of President Joe Biden’s clean energy policies, Senate Democrat Joe Manchin, who represents the coal-producing state of West Virginia, has had little trouble bolstering domestic supplies of critical minerals, hoping that they will mine may fall off profitable for coal companies. What has changed in Anderson’s 16 years of work is “the astronomical level of subsidies that drive these decisions.”

In Wyoming, grassroots organizations and the communities they serve are particularly concerned about water use and pollution, both ongoing problems in the state’s high deserts. “We’ve been dealing with the impact of coal for a long time,” Anderson said. “Are we ready to deal with the impact of new types of mining for a generation or two?”

Anderson also expressed concern that the Biden administration’s goodwill toward “energy communities” — defined as those regions once dependent on fossil fuels and faced with diversifying their economies — could lead to further exploitation in those communities, which Biden has made a priority for investment through clean energy programs.

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While many federal grants and loans focus on improving housing, broadband and energy efficiency, a few focus on mineral research, biofuels, and natural gas infrastructure. Since January 2021, the Department of Energy has announced an estimated $41 million in projects to support the exploration of critical minerals in former mining communities.

Despite these funding opportunities, many of these places can fall short when it comes to tax revenue, environmental regulations and cleanup. Laws vary from state to state, but most of the places where massive resource wealth has been mined by coal and oil companies have received only a small percentage of that windfall through wages, state royalties, local severance taxes and corporate largesse such as building parks or other amenities.

The severance tax on critical minerals, which falls under the “general minerals” tax category, is generally lower than that paid on coal and oil. Under the Mining Act of 1872 they yield no government royalties at all. For this reason, ensuring that communities see a financial benefit requires rethinking how that income is shared. “You can’t design a tax system to do a one-for-one replacement,” Anderson said.

The 1872 Mining Act also does not apply to private land or land east of the Mississippi River. That land is instead regulated by the Clean Water Act and other laws, and by allowing processes that are looser than those for oil and coal. Within this patchwork of federal, state and local laws and land ownership schemes lie many loopholes for some types of mine waste. Blaine Miller-McFeely, a mining expert at the environmental law nonprofit Earthjustice, warned that there are many ways for oil and gas companies to evade responsibility for the long-term effects of mineral mining.

“The current administration is not applying strong enough diligence standards to money going out the door,” Miller-McFeeley said. “They have the opportunity to set a high bar so that we don’t shift our sacrifice zones from oil and coal affected communities to mining affected communities.”

“These oil and gas and coal companies were greenwashing themselves,” he added, “by saying the way they’ve always done mining, which is the destructive, toxic way, is the solution to climate change. “

The Biden administration has noted these challenges, and an Interior Department task force is try to reform the 1872 Mining Act to provide for stricter environmental regulation and public process—although mining industry representatives and Republican officials criticized these efforts, and they are currently stalled. Environmental Protection Agency officials contacted by Grist have broad support for a new, strictly regulated rental system enabling the US to meet increased critical mineral demand with greater attention to water quality and communities’ rights to say no to new development, or if the development is desired, maintain transparent communication with mining companies.

Increased regulation, said Marco Tedesco, could help ensure that the communities that provide the materials needed to wean the country off fossil fuels see more of the benefits, and less of the problems, that fossil fuel extraction poses for brought them. But he cautioned that will only happen if rural, working-class communities like Lewisville engage in a public and transparent process to shape the policies needed to do so.

“Involving communities at the decision-making level in the early stages, investing to address environmental impacts, projecting the consequences on future generations and sharing the economic and financial benefits with the communities should move together,” said Tedesco, ” like the elements of a choir.”

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