Oregon Public Broadcasting

As the price of gold hits record levels, there are rumblings of a new mining rush in the American West.  According to a recent study by the Environmental Working Group, mining claims in Oregon have gone up 20 percent in the last four years. The growing demand for hard-rock minerals comes as the US Senate takes on the historic law that allowed for Western mining in the first place. Bilal Qureshi has more…

President Ulysses S. Grant, well, an actor playing Grant, paid a visit to Pioneer Courthouse in Portland this week.

The nation’s 18th leader signed the 1872 Mining Act -- and it's still in effect today.

The law charges very low royalties to encourage miners to stake claims on ‘public lands.’

President Grant: “…When I signed it into effect in 1872, it was designed to move people to the West and develop the Western states…”

Okay, so this Grant was a fake and the Portland stop on his 2008 ‘whistle tour’ was a PR stunt … but the real Grant was pretty successful.

Mining became one of the region’s leading industries.

This month gold prices topped a thousand dollars an ounce and the surging demand for gold and other precious metals could mean a new generation of prospectors are heading for Oregon.

The Federal Bureau of Land Management reports more than a thousand new mining claims in the state since January 2007.  

BLM spokesman Michael Campbell says the mining operations in the state are diverse.

Michael Campbell: "We do have sort of the widest array of people in interested in mining. Everything from people out panning for gold in streambeds to large-scale mining operations of all sorts of different types - coal, gold and zinc and silver and whatnot."

But environmental groups have raised concerns about what they see as an overly lax mining policy… Jeremiah Baumann is with the group Environment Oregon.

Jeremiah Baumann: “We’ve got 140 abandoned mines that are leaching toxic chemicals into rivers and streams… That’s because our mining laws are so outdated they don’t require companies to clean up after themselves…”

Last fall the House of Representatives in Washington, DC decided it was time for an update and passed the Hardrock Mining and Reclamation Act.

The proposed bill would impose stiffer royalties and add environmental restrictions.

BUT Miners say that would make American companies less competitive on the global market.

Laura Skaer is the Executive Director of the Northwest Mining Association.

She says the environmental provisions in the act would drive up operating costs and decrease profits…

 ...and if costs go up,

Laura Skaer: "You would see premature closure of existing mines, you would see economic destruction in rural communities that depend on mining to support not only the mining jobs but jobs in the grocery stores and the auto parts stores. Fortunately, that’s not going to happen."

Skaer believes the 1872 Mining Act reforms will die in the Senate.

Even though Democrats control the Senate, many oppose the reforms, she says  -- including majority leader Harry Reid of Nevada who has been a consistent ally of the mining industry.   

Oregon’s Senators, Democrat Ron Wyden and Republican Gordon Smith, both serve on the committee that will draft the Senate version of the Bill.

Wyden has said he’d like to reform the 1872 Mining Act.

Smith has not yet announced his position.