Hard-rock mining royalties provisions out of House reconciliation bill

House Democrats latest version of a sweeping social spending bill dropped a provision to impose royalties on hard-rock mining on federal lands.

The language, which had been promoted by Natural Resources Committee Chairman Raul Grijalva, would have closed a loophole from the General Mining Act of 1872 that imposed royalties on fossil fuel production from federal land but left hard-rock mining untouched. That language is gone, and all that remains is a $3 million appropriation for the Bureau of Land Management to develop new regulations to prevent damage from hard-rock mining.

"Not including money for hard-rock mining cleanup in the House version of the Build Back Better Act is a missed opportunity. We intend to keep working with the Senate on this issue so that communities impacted by hard-rock mining pollution get the funding they need to protect human health and create jobs," U.S. House Natural Resources Chairman Raul Grijalva, D-Ariz., said in an emailed response to S&P Global Market Intelligence.

A version of the bill released in August contained a provision to impose an 8% royalty on new mines and a 4% royalty on existing mines on federal land, both on gross income. It would also impose a "reclamation fee" of 7 cents per ton of material displaced from a mine site to pay for remediation work on abandoned mine lands. Democrats saw the imposition of new royalties as an opportunity to raise more revenue from the profits mining companies earn on rising commodity prices.

U.S. miners opposed the provision as written, but they were appeared open to compromise.

The House could consider the bill as soon as Nov. 4, but the timing of a vote is unclear.