Federal Government and Colorado Enter Into Proposed Settlement with Mining Company After the Gold King Mine Spill

Lake surrounded by trees in Las Animas County
Colorado and multiple federal agencies reached a proposed settlement with Sunnyside Gold Corporation and its parent company to clean up an area of abandoned mines. / Photo by Pete Alexopoulos on Unsplash.

Colorado and multiple federal agencies reached a proposed settlement with Sunnyside Gold Corporation and its parent company to clean up an area of abandoned mines around Bonita Peak near Silverton. The site includes the Gold King Mine, which made headlines in 2015 when water contaminated with toxic mine tailings spilled into the Animas River, turning it orange. 

On Jan. 21, Colorado and the U.S. Department of Justice, Environmental Protection Agency, Department of the Interior and Department of Agriculture announced a tentative agreement for Sunnyside Gold Corporation and its Canadian parent company, Kinross Gold Corporation, to pay $45 million to the state and federal government for the DOJ to dismiss claims against the two companies. The mining companies will also drop litigation against the U.S. that will fund the clean up. 

The agreement is subject to a 30-day public comment period and final court approval. 

The $45 million sum will help fund the continued clean up of the Bonita Peak Mining District Superfund site, with the U.S. contributing another $45 million. The EPA has spent $75 million cleaning up the Bonita Peak Mining District Superfund Site, which was created in 2008 after heavy metal leaches from the area’s abandoned mines led to water quality declines and wildlife deaths. 

The Bonita Peak Mining District Superfund site has 48 abandoned, historic mines from Colorado’s mining industry age. Mine waste piles, tailings and flooded mine shafts have led to heavy metal contamination in the Animas River and other bodies of water in the area. 

In 2015, the Gold King Mine located in the district made international headlines after the EPA, in an attempt to investigate and treat water in the mine, caused three million gallons of water stored in the collapsed shaft to pour into the Cement Creek. The wastewater contained toxic contaminants including lead, iron and arsenic, among others. The Cement Creek turned orange and other nearby water systems were impacted. 

The latest settlement resolves four multidistrict lawsuits brought by governments impacted by the spill, including New Mexico, Utah and the Navajo Nation, against the EPA and Sunnyside Gold Corporation, which in 1996 plugged the entrance of a mine near the Gold King Mine. 

The litigation in the U.S. District Court for the District of New Mexico alleged that by plugging the nearby mine, Sunnyside Gold Corporation caused water that normally flowed out of the Sunnyside Mine to fill nearby mines with acid drainage. The lawsuit claims that the EPA was alerted about the nearby Gold King Mine and Red and Bonita Mine was aware of the acid drainage, which could cause a potential blowout as early as 2007.  

Starting in 2011, the EPA and several contractors, some of which were named in the original suits, took steps to increase water flow at the Red and Bonita Mine and made plans to do the same at Gold King. Gold King, which was created in 1887 and later abandoned in the 1920s, was flooded with water filled with mine waste. The lawsuit alleges that the EPA ignored precautionary steps to excavate the Gold King Mine and on Aug. 4, 2015, dug into the mine’s entrance with a backhoe, triggering the spill. 

The latest settlement, totaling around $90 million, resolves civil claims brought by the U.S. and the mining companies against one another related to the spill. As part of the consent agreement, the mining companies and federal agencies did not admit any liability around the Gold King Mine incident but agreed to drop their complaints. 

“Today’s settlement holds these companies accountable for their past mining operations at the site,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division in a press release. “This settlement demonstrates the Justice Department’s and cleanup agencies’ continuing efforts, together with our state partners, to ensure that Superfund sites are investigated and remediated.”

Sunnyside entered into a $21 million settlement with New Mexico and the Navajo Nation last year, Colorado Politics reported, to resolve claims over their role in the spill. The latest settlement puts aside $4 million to be paid directly to Colorado by Sunnyside, adding to $1.6 million that the company agreed to pay in December 2021.  

 “This settlement will allow continued cleanup of this Superfund site, in coordination with our federal and local partners, to ensure the protection of human health and the environment for generations to come,” said Director Tracie White of the Colorado Department of Public Health and Environment’s Hazardous Material and Waste Management Division in a press release.

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