Nick Michael thinks he has got a great idea. Collect ore and tailings from the slag piles scattered around Leadville, extract bits of silver and gold in a vat of chemicals and then store the waste in a permitted facility.
It’s a plan he’s been simmering since he bought the dormant Leadville Mill in California Gulch in 2008.
“Why create new quarries and mines when we have all this slag and ore we can use?” Michael said. “This is environmental justice and the circular economy.”
The plan is facing fierce opposition from residents in the Upper Arkansas River Valley who are concerned about impacts to the headwaters of the Arkansas River and a return to a mining legacy that the community has spent half a century cleaning up. The Environmental Protection Agency in the 1980s designated the California Gulch area — once home to hundreds of silver, lead and zinc hardrock mines — as a Superfund site, launching an ongoing 50-year cleanup project.
“Think about the mining history up there and what we’ve been through with the EPA and the Superfund and the settlements with mining companies. Why would we go back to that?” said Brice Karsh, the owner of the Rolling J Ranch, which has two miles of rehabilitated riverfront that was polluted by local mining decades ago.
The mill owner has filed a third application for a permit with the Colorado Division of Reclamation, Mining and Safety seeking permission to move forward with the plan for the mill two miles west of Leadville in the California Gulch tributary of the Arkansas River adjacent to the Leadville water treatment plant. The Leadville Mill plan calls for trucking tailings from nearby mine dumps to the renovated mill, where the mined rock will be crushed and mixed in a vat with a sodium cyanide solution to separate gold and silver. Michael’s Union Milling company has a plan to detoxify the poisonous cyanide in the mill before the tailing reach a lined pond and storage facility.
Union Milling and landowner CJK Milling Co. in 2021 filed an application with the Colorado Division of Reclamation, Mining and Safety to reopen the idled mill and expand operations with the cyanide leaching. CJK Milling calls the remediation plan “the largest mine-waste cleanup in Leadville history.”
The operator and owner filed a revised application in 2023 to open the Leadville Mill with the Colorado division of mining and another revised application in February. The latest application filed in February asks for a permit to increase the 10-acre footprint of the Leadville Mill to about 43 acres with a capacity to process 400 tons of ore a day, hauled from historic dumps and slag piles around Leadville and the mill.
The Leadville Mill application says the piles will be removed and remediated with topsoil and grass within six months of starting operations at the mill.
Michael said the plan to remove and remediate mine dumps around Leadville could be a model for private investors who can make money on reclamation.
“We are not wanting to make holes in the ground. We are cleaning up what’s already been done,” said Michael, whose plan includes offering slag and ore waste for concrete and road base. “Lake County has the California Mining District zoned for industrial and mining purposes. … We are not applying to do something that is not allowed on the land.”
Michael started planning to reopen the mill to process ore and tailings piled around Leadville in 2009 and secured a permit from the state and Lake County in 2011 as he slowly began investing in renovations of the mill property. He sold the mill to CJK Milling in 2020 and filed for an amended permit for the new owner in 2021. That permit application was rejected because homes had been built close to the property in the past decade and the operation did not meet state standards for a tailings storage facility.
The mill has never operated since Michael purchased it.
In 2023, Union Milling and CJK Milling submitted a new application with the state mining division but with plans for a filtered tailings dam for a facility that would not discharge any water into the local watershed. The two companies pulled the permit to make adjustments to the project that moved operations away from adjacent homes and resubmitted an application for a permit in February.
The project does not propose any mining, only milling and processing up to 170,000 tons a year of tailings and ore piles on the property and removing tailings piles in Leadville, where the Environmental Protection Agency is remediating toxic mines in the 18-square-mile California Gulch Superfund site. Federal cleanup of the California Gulch mining sites is about 90% completed.
CJK Milling owns about 12 ore piles around Leadville and the initial plan is to remove two of the piles and process the ore and tailings in the Leadville Mill. There are an estimated 2,000 mine waste piles around Leadville.
The Division of Reclamation, Mining and Safety determined the application required additional review and has scheduled a decision by July 10.
Since 2021, Lake County and downstream residents and business owners — galvanized as Concerned Citizens for Lake County — have sent the state mining division dozens of letters opposing the mill plan. Many emphasize the shifting economy in Leadville and Lake County, with a growing emphasis on tourism and recreation, with concerns focused on how a cyanide leaching operation in the headwaters of the Arkansas River might threaten the region’s environment and economy.
Karsh has 223 acres in the headwaters of the Arkansas River across U.S. 24 from the Leadville Mill. He spent more than two decades as a consultant working on the largest environmental lawsuits in the world, targeting pollution by multinational corporations. He said he learned in his career that processing facilities often fail and storage facilities “will always eventually fail.”
In 2014, Colorado Parks and Wildlife designated 102 miles of the Arkansas River as the longest Gold Medal Fishery in Colorado, stretching from just below Leadville to the top of the Royal Gorge.
“There’s a lot more at risk than they care to admit,” Karsh said. “Just taking old tailings that have sat dormant for decades and stirring that up and moving it across town is its own environmental hazard. Bottom line is that Leadville is not at a place where we need this and we don’t want this.”
Rafting and angling outfitters on the Arkansas River below Leadville — the most trafficked stretch of whitewater in the country — are closely watching the mill plan.
“We view this as a huge threat to the health of the Arkansas River,” said Rob Williams, the head of Noah’s Ark Adventure Co. in Buena Vista.
An economic analysis of commercial activity surrounding the Arkansas River shows 196,100 visitors spending $19 million with outfitters on the river in 2022. Add in lodging, food, travel and other spending and those visitors left $38.6 million in communities along the river in 2022.
The 2022 analysis by Pacey Economics — the second of three planned studies developed to identify economic trends along the Arkansas River — shows river users booking commercial trips generating a $49.4 million economic impact in and supporting 498 full-time jobs in Chaffee and Fremont counties in 2022.
Longtime residents of the Upper Arkansas River Valley remember when toxic discharges from the 4-mile long Yak Tunnel, which drained several of the hundreds of mines in the Leadville Mining District into California Gulch, turned the Arkansas River crimson red in the early 1980s. Those spills lured the EPA and what would become a 50-year and ongoing cleanup project, which includes $56 million in federal funding last year for improvements to the Leadville Mine Drainage Tunnel and treatment plant.
“Those spills weren’t that long ago, really,” said Bob Hamel with the river outfitters association. “Think of all the work that has gone into cleaning up this river. Think of the tourism and economies downstream. There are a lot of communities with a lot invested in this river, and we don’t want to withstand a spill. Leadville is not like it was 100 years ago. Things have changed along the Arkansas River.”