Ex-Governor’s Group Files Claim in Mining Dispute

By Beacon Staff

BILLINGS – A group of investors that includes former Gov. Brian Schweitzer filed a $10 million compensation claim in federal court Thursday against a Washington state mining company.

Schweitzer’s group said in its court filing that Mines Management, Inc. would face up to $70 million in additional costs if it could not access a huge silver and copper reserve by passing through the group’s mining claim.

Mining claims give companies certain rights to mine, but can be condemned by the courts if they are needed by another mining venture.

In this case, Mines Management needs the claims to develop its proposed Montanore mine, which the company says holds an estimated 1.7 billion pounds of copper and 230 million ounces of silver.

U.S. District Judge Dana L. Christensen last month issued a preliminary condemnation order in favor of Mines Management. That set off a process to determine how much Optima should be compensated for its losses.

Mines Management Chairman and Chief Executive Officer Glenn Dobbs said fair compensation would be far less than $10 million — and possibly no money at all. He said the company will conduct an appraisal to determine a fair value.

Dobbs has accused Schweitzer of trying to force him into an unfavorable deal by threatening to generate negative publicity for the project and drive down share prices. Schweitzer has denied the accusation and said he’s seeking a resolution to the dispute so mining can proceed.

Schweitzer is a director and investor in Optima Inc., which holds the claims on parcels in the Cabinet Mountains Wilderness near Libby. Mines Management has a 14,000 foot tunnel that passes through the claim that it needs to develop the Montanore mine.

If the two sides cannot reach an agreement in the next 20 days, Christensen would appoint a three-member commission to settle the dispute.