mining company has paid the government a record $1.79 billion to settle claims

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Asarco Pays $1.79 Billion To Fix Sites


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By LESLIE KAUFMAN
Published: December 10, 2009

After a four-year legal battle, a mining company has paid the
government a record $1.79 billion to settle claims for hazardous waste
pollution across 19 states, federal agencies announced Thursday.

Officials said the payment on behalf of the company, the American
Smelting and Refining Company, or Asarco, was the nation’s largest
environmental bankruptcy settlement.

The money, received Wednesday night from a subsidiary of the mining
conglomerate Grupo Mexico, Asarco’s parent, will be used to repair
extensive damage from the mining operations.

Asarco, a 110-year-old copper company based in Tucson, was accused of
gross environmental misconduct at numerous sites, including illegally
burning hazardous waste instead of disposing of it properly.

As a result of the company’s actions, lead and other toxic metals
traveled downstream, polluting water and soil in many places, the
government found.

The deal required the cooperation of the Justice, Interior and
Agriculture Departments as well as the Environmental Protection
Agency. At a news conference, officials were jubilant about the
outcome.

“This was a result no one expected when Asarco went into bankruptcy,”
said Associate Attorney General Tom Perrelli. “This gives us full
payment plus interest for allowed claims. Taxpayers got more than a
dollar back for every dollar they asked for.”

Jack Kinzie, a lawyer at the firm Baker Botts who was the lead lawyer
for Asarco in the bankruptcy case, called the settlement “fair.” But
in a statement in June, the firm said it had been able to limit the
allowed claims against the copper giant to substantially less than the
$3.6 billion originally filed.

Still, federal officials said the $1.79 billion was more than they had
expected to get when Asarco filed for Chapter 11 bankruptcy protection
in 2005.

In August, the United States Bankruptcy Court for the Southern
District of Texas opened an auction for competing plans that would
allow the company to be bought out of bankruptcy.

Because the price of copper was high, higher bids with larger cash
components surfaced as time passed, said John C. Cruden, a deputy
assistant attorney general with the Environment and Natural Resources
Division of the Justice Department.

“This demonstrates that just because a company goes into bankruptcy
doesn’t mean it will avoid its responsibilities,” Mr. Cruden added.

The settlement money is already being distributed to pay off cleanup
and restoration at more than 80 contaminated sites. The largest single
payment, $436 million, went to clean up a toxic mine site in the Coeur
d’Alene Basin in Idaho.

A trust for overseeing the cleanup of a smelter site in Omaha that
spewed lead over 27 square miles of surrounding water and soil
received $219 million.

In all, said Mathew V. Stanislaus, assistant administrator for solid
waste and emergency response at the Environmental Protection Agency,
the money will cover the cleanup of 10.5 million cubic feet of soil
and 5 million cubic yards of water — “enough to fill 1,500 Olympic-
size swimming pools.”
More Articles in Science » A version of this article appeared in print
on December 11, 2009, on page A26 of the New York edition.