TECHNICAL MEMORANDUM: REVIEW OF THE SUPPLEMENTAL DRAFT ENVIRONMENTAL IMPACT STATEMENT NorthMet Mining Project and Land Exchange

March 10, 2014 Prepared for: Minnesota Center for Environmental Advocacy Prepared by: Tom Myers, PhD, Hydrologic Consultant, Reno NV The U.S. Forest Service, Minnesota Dept of Natural Resources, and the U.S. Army Corps of Engineers have released the supplemental draft environmental impact statement (SDEIS) for the proposed Northmet Mining Project and Land Exchange. This technical memorandum reviews that SDEIS with a focus on hydrogeology. All references simply to page numbers, tables or figures are to that document. This author also prepared a review of the Goldsim modeling used in support of the SDEIS (Myers 2014b) and an independent assessment of the flow and transport at the site (Myers 2014a). These documents are referenced freely within this document and should be considered as part of the overall review of the hydrogeology. Finally, other Polymet documents have been reviewed as part of this review or as part of Myers (2014a and b). The review is structured in sections based on topics. Where the topics overlap or a comment may apply to more than one topic, there are references to the comments at other locations. Lack of Alternatives Analysis The DSEIES considers effectively just the proposed action and the no action alternative. The executive summary (p ES-42) claims that alternatives which would make the mine seep less water have already been included, so they are not considered as an alternative. The ES also eliminates from further consideration alternative wet and dry closure options for the Tailings Basin, backfilling the West Pit with Category 1 waste rock, and underground mining (p ES -42). West Pit Backfill was rejected without substantial argument or technical analysis because they claim it would not offer substantial environmental benefits (p 3-151). Backfill would increase constituent loads in the pit (p 3-151), but they do not discuss this in detail. The total load reaching the groundwater from backfill could be substantially less than the perennial load from the stockpile, especially if the Cat 1 stockpile containment system does not work as well as expected. This could have considerable environmental benefits not adequately considered in the SDEIS (the SDEIS claims the only advantage is the opportunity to reclaim wetlands at the Cat 1 footprint area (p 3-152).

Recommendation: Polymet should give the West Pit backfill option a thorough evaluation with the Goldsim model so that there could be a comparison of concentrations with and without backfill. They also note there are additional mineral resources in the West Pit that would effectively be lost if the pit was backfilled (p 3-149). Those resources might also be lost if they had to pump and treat 80,000 af of pit lake water to access additional deposits. The SDEIS should consider whether accessing those deposits would be possible once a pit lake forms. Recommendation: Discuss the difficulties associated with pumping out a pit lake, and treating the water, to recover ore at the bottom of the pit. Consider these difficulties in discussion and decision as to whether to consider this as an option. Polymet has not prepared a mining and reclamation plan (p 3-5), so the exact timing of activities must be considered imprecise; this applies in particular to the water quality modeling as presented throughout the SDEIS. Recommendation: Acknowledge that the times for various management activities during reclamation and closure are approximate because the reclamation plan has not been prepared. The model comparisons use a Continuation of Existing Conditions scenario to compare to the project (p 5-78). This scenario is considered for modeling only because it does not include the potential for any future mitigation that may occur at the existing tailings impoundment. They distinguish this alternative from the No Action alternative in that the No Action alternative allows change including the implementation of other projects, required mitigation at existing facilities, and climate change. Hydrogeology of the Site The SDEIS claims there will be a 130-ft separation between the final pit and Biwabik Formation (p 4-43). This is important to their analysis because they consider the Biwabik to have a much higher permeability. They ignore the possibility of a fracture connection between the pit and the Biwabik, which could require much higher dewatering rates. The conductivity values (Table 4.2.2-5) are provided in a not-useful way. Without knowing the number of samples, simply providing a range and a geometric mean is not meaningful. It would be better for the table to simply list all observations especially since they range over several orders of magnitude. The SDEIS overstates the roll of gouge in filling the faults in the areas (p 4-45). The original literature (Foose and Cooper 1978) referred only to the NE trending faults as being gouge filled.

Shorter faults, on the order of km, could still be significant transport pathways. This literature should not be a substitute for an adequate fracture analysis of fractures. The SDEIS acknowledges that some tests using wells that penetrated through the surficial zone (p 4-45) found much higher average hydraulic conductivity, with values similar to the Biwabik Formation aquifer (Id.). The bedrock is very shallow so this suggests that there may not be a sharp delineation between the surficial aquifer and the bedrock. Myers (2014a) found in the development of a groundwater model for the site that the surficial aquifer by itself was too thin to provide the needed transmissivity and that it was apparent that flow occurs through the bedrock. Recommendation: The analysis that relies on low permeability bedrock just under the till should be reconsidered and potentially redone. Additional fracture analysis should be completed to better consider the potential for fractures or faults being connected to more distant resources. Modeling Comments from the SDEIS Base parameters for the SDEIS modeling were set using MODFLOW and XP-SWMM modeling (5-26, -27). The mine site MODFLOW model is a small telescoped section of a large regional model. The head along the mine site model was set from the head distributions predicted by the regional model. Because the regional model had just two layers while the telescoped site model had eight layers, this practice introduces potentially significant errors, essentially eliminating vertical gradients among layers by setting the head in seven bedrock layers equal to the head in one regional bedrock layer. The SDEIS touts that an important calibration constraint for the MODFLOW recalibration is that predicted hydraulic head in the surficial aquifer would not be above ground surface (p 5 27). This seems like an appropriate constraint, but in reality is unnecessary and may even introduce inaccuracies to the calibrated model. There are at least three considerations. First, the simulation sets the upper layer as unconfined, but the reality is that some areas, especially with perched wetlands, could be fully or partially confined. Confined conditions could cause the head in areas in reality to be higher than ground surface. Second, the model limits the flow to a specified layer thickness whereas the reality is that thickness is variable. Areas with simulated head slightly above ground surface may reflect that transmissivity is too low due to the thickness of the aquifer. Third, allowing the head to extend above the ground surface does not in any way affect the predicted results of river discharge or drawdowns; the only time it causes an error is if the model is simulating evapotranspiration, which is not being done herein.

There are questions regarding the recharge value used to calibrate the model. Myers (2014 a and b) consider this issue in detail. Calibration with a recharge that is too low causes inaccuracies throughout the MODFLOW model which are then passed to the Goldsim model (Myers 2014b). Recommendation: Recalibrate the MODFLOW model based on higher recharge which would yield more realistic conductivity parameters (see comments elsewhere). The SDEIS claims there is very little transport in the bedrock flowpaths, primarily because of its very low bulk conductivity (p 5-53). The low bulk conductivity is largely the result of the groundwater model calibration and assumptions about bedrock conductivity, reviewed above, based on the low recharge estimate. Because the modeling does not account for the secondary conductivity and scale effects, it is likely that both the effective conductivity is underestimated and that flow could take much more substantial pathways than assumed by Polymet. Recommendation: Consider a much higher range of bedrock conductivity in the Goldsim modeling. The description of how they determine the P90 value from a Goldsim run, described in the third paragraph of p 5-77, appears wrong. Goldsim is run 500 times, or conducts 500 simulations of a 200-year period with monthly time steps (p 5-77). Each 200-year simulation results in a monthly observation of each output, or one value for each month for 2400 months. That is not the equivalent of 2,400 water quality predictions (200 years times 12 months per year) for cobalt (Id.). It is one prediction for each month. Running Goldsim 500 times generates 500 time series of monthly predictions. Thus the P90 is determined for any month based on the 500 generated values for that month, not based on 2400 realizations over a 200-year period (as repeated on p 5-106). The P90 value is that which lies at number 450 in a ranking from 1 to 500 of the lowest to highest simulated values. All of the output graphs show P10, P50, and P90 values with time, by month, for 200 years, so it appears that it was done correctly using the Goldsim output as generated. Recommendation: Describe the processing of model output to obtain the P90 value correctly. Partridge River Baseflow There is controversy over the estimate and use of baseflow on the two rivers draining the project site. Baseflow is the surface flow that consists wholly of groundwater discharge to the river, although in reality it is difficult to separate from runoff. Baseflow varies throughout the year depending on precipitation. After a wet period, once surface runoff ceases the remaining flow is baseflow even though that baseflow may actually exceed peak flows from smaller runoff events, especially those occurring after a long dry period. 4

A critical water quality period in the Partridge and Embarrass Rivers occurs during baseflow because surface water flow would consist strictly of groundwater discharge and its water quality then would equal the water quality of the groundwater discharge. Very low flow baseflow periods are often considered the critical periods for estimating discharge effects on water quality. The Polymet SDEIS uses the annual 30-day low flow as the critical baseflow for water quality considerations (SDEIS, p 4-66; Kruse 2013), which is a proper strategy. It is not proper, however, to assume the 30-day low flow equals the average basinwide recharge in this watershed because it is not possible to assume the entire watershed is contributing during baseflow conditions. The baseflow may be recharge but only from a portion of the watershed. By setting recharge equal to the 30-day low flow, Polymets recharge estimate was about 0.8 in/y, which is not correct because it is based on only a small portion of the watershed contributing baseflow. It is common to set the average baseflow from a watershed equal to some duration, often 30 days, low flow and to then set that flow rate equal to the average recharge over the basin (Myers 2013, 2009). This equivalence would only apply if the entire watershed is contributing groundwater to the discharge. In small watersheds in which the flow path from the points of recharge to discharge is substantially less than a year, the amount of watershed contributing at any given time may be substantially less than the entire area. This would also manifest in watersheds in which most of the precipitation is frozen for much of the year. Myers (2014a) estimates a significantly higher recharge based on a new baseflow reconstruction. Myers (2014b) provides substantial comments on the use of the 30-day baseflow for recharge. Recommendation: Polymet should reconsider their recharge estimate for modeling based on Myers (2014a and b) and recalibrate the MODFLOW model based on that correct recharge value. Water Quality Polymet relies on detailed modeling with the Goldsim model to estimate water quality parameters resulting from this project. The model details itself are discussed in Myers (2014b) and in the previous section. The general conclusion is that the P90 value does not exceed the evaluation criteria at any of the groundwater, either surficial or bedrock, evaluation points for any of the constituents (Figure 5.2.2-20, p 5-113). Recommendation: This is a rather general recommendation in that the Goldsim modeling should be redone with better parameterization from the MODFLOW model, as discussed in the previous section. 5

The SDEIS argues that there is no potential for saline groundwater to be drawn to the mine site area due to changes in hydrogeology (5-113, -114). The reasoning is sound, but uncertainty remains. The claim that dewatering pumping would capture inflow before it reaches the pit (5114) is not sound because saline inflow from depth would likely enter the bottom of the pit. Also, if the transport pathway for saline groundwater is a large fracture, the inflow may be much higher than expected and dilution may not occur as expected. The predicted relative rates of groundwater inflow from bedrock and surficial aquifer (p 5-114) are based on very incomplete knowledge of conditions at depth which would control inflow from depth, including of saline groundwater. Recommendation: Polymet should establish a series of deep groundwater monitoring wells, screened at locations in the 500 feet below the pit bottom, to assess both changes in head and water quality. There should be continuous electrical conductivity monitoring so that salinity changes can be quickly detected. Polymets predictions for surface water quality are that at all locations above Colby Lake and for all constituents modeled, only sulfate and aluminum will exceed the criteria. The project does not however increase the concentration above the continuation of existing conditions simulation. The sulfate exceedences occur at SW005 and SW006 because the wild rice standard applies at that point. The SDEIS details the movement of SO4 through the system and how SO4 predictions would occasionally violate the standard at SW005 (p 5-140 to -142). They note the exceedences are most likely after 70 or more years because that is the travel time for SO4 through groundwater pathways, but also note the low flow rate through these pathways limits the effect of the groundwater discharge. They also claim that flows from some sources have sufficiently low concentrations that the flow helps to dilute the transport from other sites. Using the Monte Carlo sampling in Goldsim, the SDEIS claims that the project results in at most a 6.6% increased chance of SO4 violating standards at SW005 (Figure 5.2.2-28). The model also shows that the P50 and P10 values of SO4 actually decrease. For aluminum, the concentrations decrease due to dilution. A few constituent (ie., arsenic, antimony, cadmium, cobalt, copper, lead, nickel and selenium) concentrations increase due to the project, but remain far below the criteria. The modeling assumes these constituents will be treated but the results do not have to be as perfect as for sulfate because the background concentrations are lower. The project will degrade water even if concentrations remain below the evaluation criteria.

These predictions are the result of modeling which has been reviewed elsewhere (Myers 2014 a and b) and in this review. These results rely on perfect engineering and severe model assumptions (Myers 2014b). Recommendation: Reconsider the modeling of the surface water quality considering the comments in this review, Myers (2014 a and b), and the review documents prepared by Ann Maest, Glenn Miller, Dave Chambers, and Mike Malusis. Contingency Plans: The SDEIS discusses contingency plans that could be employed if groundwater monitoring below mine features shows that concentrations exceed the model predictions (p 5-143). They basically claim that if the monitoring shows the project would cause or increase exceedances of the applicable evaluation criteria for sulfate, then contingency measures could be implemented and adapted as necessary to decrease effect on the Partridge River prior to an actual effect occurring (p 5-143). There are several proposed contingency measures discussed below: The WWTF could be changed to generate effluent with sulfate concentrations less than 9 mg/l, down to an average and maximum of 3.7 and 6.9 mg/l, respectively. Because the discharge exceeds the groundwater flow Polymet believes this would dilute the higher concentrations. This assumes they could time the groundwater flow and of course that these treatments could be achieved. See the reviews of Glenn Miller and Ann Maest for comment on whether this is possible. Polymet could temporarily increase the discharge rate from the WWTF to dilute the groundwater flows. Again, this assumes they could time it perfectly and also that the WWTF discharge rate could be easily and cost effectively increased to meet this proposed requirement. They could install groundwater containment facilities in the various flow paths. These are not described in the SDEIS, but there is an implication that water would be collected and treated. Pumpback wells on large flowpaths may not be effective or may be very costly to construct and operate. Also, the WWTF would have to be upgraded to the higher flow rate. Once a contaminant is in the groundwater, it is very difficult to remove; Polymet is assuming they could do it with little difficulty.

They also suggest there could be non-mechanical treatment systems along flowpaths. Considering the flowpaths are groundwater, there is little clue as to what these could be. Recommendation: The SDEIS should describe both the groundwater monitoring system and better describe how the contingency plans could actually work. They should demonstrate with their MODFLOW model that pumpback or other groundwater treatment can work. They should

demonstrate using Goldsim that they can actually time the groundwater discharges to surface water so as they can actually increase the WWTF discharges for dilution. Surface water quality on the Embarrass River will change as a result of the project, though Polymet claims no standards will be violated. Concentrations for arsenic, copper, lead, nickel and zinc will increase because the augmentation water discharged from the WWTP will have concentrations higher than that discharging currently from the tails (p 5-182). Recommendation: The SDEIS should discuss why the WWTP cannot treat the water so that degradation to the river will not occur. Background Water Quality: Aluminum and copper increase slight in a downstream direction (4-74). Some background, or natural groundwater concentrations (beryllium, manganese, thallium) exceed published standards but Minnesota allows the natural level be used as the standard. This is not unreasonable, but it should not be used to allow the project to increase those standards, whether by discharge or by changes in the hydrogeology due to the project. Recommendation: In cases where the natural background exceeds published standards, the project should not be permitted to cause any increase in concentrations or further degradation of the resource. This means any discharge (seepage) much have a lower concentration than natural so that the net effect is dilution. Mercury is a constituent of concern because it is on the impaired water list due to high Hg content in fish tissue (p ES-36). Colby Lake is on 303(d) list for Hg concentrations in fish, but is not subject to the regional TMDL because the concentrations are too high and caused by atmospheric deposition. Polymet suggests it will stabilize in the West Pit Lake at 0.9 ng/l, or slightly below the standard. They indicate the load to the Embarrass River will increase due to seepage from the tailings but that reductions in the Partridge R will offset the increase for the St Louis watershed as a whole. They also claim that 92% of the Hg in the tails will remain there; this claim must be considered. The project would release some Hg and potentially increase concentrations but is not predicted to exceed standards (p 5-8). Recommendation: Polymet should better justify the claim that 92% of the mercury will remain in the tails. Mine Dewatering The dewatering rate for keeping a pit dry is controlled by conductivity, storage coefficients and gradient. The gradient changes simply by lowering the water table. The conductivity controls the gradient and the storage coefficient controls the volume of the drawdown cone. These

values could vary by an order of magnitude, or more. There is a significant range in dewatering rates that could result from such a range. The SDEIS essentially argues that the MODFLOW-predicted drawdown is inaccurate (p 5-92). If that is correct, that drawdown estimates from MODFLOW are inaccurate, then dewatering estimates are also inaccurate. Recommendation: The SDEIS should acknowledge there is a large uncertainty in the estimated dewatering, and provide an estimated range of dewatering rates. The SDEIS does not discuss the fate of the dewatering water. Its use does not seem to come up. The SDEIS mentions make-up water from Colby Lakes, but not the use of dewatering water. Recommendation: The SDEIS should identify what the dewatering water will be used for or whether it will simply be discharged. Unless there is a water quality problem, the dewatering water should be reused onsite. The SDEIS states that the largest change in surface water flow occurs to baseflow at year 11 (Table 5.2.2-25 and associated text). The analysis includes changes due to changes in the drainage areas caused by the project. Myers (2014) demonstrated that the groundwater discharge could be decreased much more than predicted in the SDEIS, therefore the predictions in the SDEIS are likely wrong. Recommendation: Use the MODFLOW model to predict decreases in the discharge to the river or to predict water drawn from the tributaries or wetlands which could reduce river flow.

Dewatering-Caused Drawdown Dewatering pits will cause drawdown in the surrounding surficial and bedrock aquifers. The drawdown is maximum at the pit and expands away from the pit as pumping draws water from further in the aquifer. Hydraulic conductivity and storage characteristics control the shape of this drawdown. Polymet chose not to use their own MODFLOW-generated drawdown predictions because similar predictions were deemed to be inaccurate at the nearby Canisteo pit. The differences between predicted and simulated water levels at Canisteo ranged from +28 to -4 feet. They conclude that the model clearly could not accurately estimate water level changes of a few feet or less as would be desirable for assessing potential effects on nearby surface features and that therefore it was not reasonable to quantify drawdown using MODFLOW (p 5-92). Therefore they used an analogue model based on Canisteo. Their reasoning is wrong the inaccuracies at Canisteo do not obviate the predicted results. With respect to effects on surface features, drawdown of a few feet will cause those features to go 9

dry. There is simply little difference to a wetland if the drawdown beneath it is 5 or 500 feet the wetland becomes just as dry. With respect to streams and rivers, drawdown that changes the gradient of the groundwater connection with surface water will change the discharge rate it is not even necessary for there to be any drawdown at the feature. The SDEIS outlines various differences between Northmet and Canisteo. The two most obvious are the bedrock at the Canisteo, the Biwabik bedrock, is much more pervious than at Polymet and the till at Canisteo is much thicker. If the bedrock is more pervious, more water would be drawn from it more easily. Drawdown could extend further in that formation without affecting the surficial aquifer as much. The SDEIS claims the analogue model was based on pit lake recovery measurements, not on actual dewatering results (p 5-92). This renders the results suspect so they should not be used in the SDEIS. Recommendation: The MODFLOW results for drawdown should be included in the SDEIS, either to supplement or replace the analogue discussion. The following figures are snapshots of drawdown maps from Polymets MODFLOW study (Barr 2008), showing that one-foot drawdown in the surficial aquifer would extent more than 2250 feet from the West Pit and more than several miles in the bedrock. The aquifer thickness in the surficial aquifer limits the depth of drawdown in that aquifer. Myers (2014a) also simulated drawdown much further from the pit than the analogue model would suggest.

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The drawdown results indicate that Polymets modeling does not include a significant connection between the surficial and bedrock aquifer, because the surficial aquifer does not drain into the bedrock. This may be deduced from the fact that the bedrock drawdown occurs under the surficial aquifer. This differs from the description in the SDEIS, p 5-91 to -92, which claims that bedrock remains saturated due to the surface aquifer draining into it. The drawdown in the bedrock is on the order of tens of feet. The surficial aquifer would desaturate before or into the bedrock aquifer. The SDEIS notes that the analogue drawdown guidelines would apply during mine operations and during reclamation, but that drawdown should decline and essentially cease as the pits flood (p 5-93). However, it also notes that there would be a 20-foot and 10-foot permanent drawdown in the West and East Pits, respectively. These are due to a planned lowering of the long-term water table using outlet structures. However, the SDEIS does not disclose the longterm, essentially permanent effects of maintaining these drawdowns. This project is in an area where precipitation exceeds evaporation, so the pit lake would not naturally be terminal it would fill until it reaches a rim and begins to spillover unless groundwater outflow counters the inflow. Polymets proposal must include a requirement for pumping and treating the potential outflow, essentially forever. Recommendation: Polymet should run their MODFLOW model in steady state mode with the water level in the pits controlled at the proposed levels. Polymet should also disclose in the SDEIS that maintaining the water level below the natural levels will require pumping/diversions from the pits essentially forever; this would include a requirement to treat the water. Hydrology Changes due to Seepage from the Tailings Impoundment Polymet will install a seepage containment system around the tailings impoundment that is designed to reduce seepage along the groundwater pathway to the Embarrass River from 209 to 21 gpm while removing 3171 gpm for treatment. The amount removed is diverted from either the existing seeps or from groundwater flow. The description of the reduction in seepage to the Embarrass River watershed during closure is very misleading it claims there will be a reduction from the estimated current rate of 2020 gpm to 1320 gpm but that since the groundwater containment system remains in place there will be only 21 gpm of seepage bypassing the containment (p 5-160). It is therefore inaccurate to claim that 1320 gpm will reach the watershed. Recommendation: Change the discussion of tailings seepage to acknowledge that the containment system prevents seepage from reaching the watershed. The SDEIS claims the reduction in average annual flow rate along the three groundwater flow paths to Mud Lake Creek, Trimble Creek, and Unnamed Creek will be 37% (North Flowpath), 12

65% (Northwest Flowpath), and 46% (West Flowpath). Polymet proposes to augment the flows so that the maximum reduction is about 20% with water from the WWTP plant. This review is not considering the sources but is considering the efficacy of discharging this augmentation water into the streams. One consideration is that the water flows through the shallow groundwater and wetlands to reach streams. Presumably (there is no description) the augmentation would be pumped to the streams thereby bypassing (and allowing to dry) the wetlands. Also, the augmentation will reduce the sulfate concentrations downstream in the Embarrass River. Recommendation: The SDEIS should describe the flow augmentation in Embarrass River better so that its effectiveness can be considered and the proposal can be assessed as to whether it will cause the wetlands to dry. Wetland Hydrology Wetlands cover 43 percent of the mine site and many are primarily supported by direct precipitation due to the lack of interaction between surficial and bedrock aquifers. Polymet expects a variable connection between wetland areas and bedrock depending on the characteristics of the wetlands and the localized hydraulic conductivity and degree of bedrock fracturing (4-150). The wetlands receive minimal runoff because the soil texture allows rapid infiltration, but the interaction between the surficial and bedrock aquifers is assumed to be insignificant (p 4-149). The SDEIS bases this idea on a reference to Siegel and Ericson, but their interpretation is wrong. Water in near-surface bedrock aquifers is under unconfined conditions except where the bedrock is overlain by drift of low permeability. Water in the bedrock occurs in secondary openings such as joints, fractures, and leached zones. The bedrock generally has extremely low primary hydraulic conductivity and yields little or no water unless secondary openings exist. Fractures and joints in the Duluth Complex may extend to considerable depths but are more extensive in the upper 200 to 300 feet of the bedrock. (Siegel and Ericson 1981, p 7) These extensive fractures would enhance a connection between the bedrock and surficial aquifers, not render it insignificant. The SDEIS assumes there is little connection throughout, but is incorrect. See also Myers (2014a). The SDEIS discusses a five-year wetlands hydrology observation period. They interpreted large fluctuations in water levels (p 4-151) as being indicative of wetlands supported by precipitation and local surface runoff. The SDEIS does not define large fluctuation. They note that shrub swamp wetlands located near the downstream portion of the project generally show more stable water levels due to larger watershed areas and some apparent 13

groundwater inflow (Id.). There is no context to the description more stable. They point out that groundwater flow paths between recharge and discharge are generally short, a description that applies throughout the project area. The SDEIS lists six things that could affect wetlands (P ES-38). This review considers two of them the changes in wetland hydrology due to groundwater drawdown and changes in wetland water quality related to leakage from mine dumps or seepage from mine pits. The SDEIS suggests that wetland hydrology monitoring would be conducted only during the operations phase. This is not correct because pit lake development will draw water from the wetlands far beyond the end of dewatering. This applies whether the Polymet pumps the pit full, as described, or whether it fills naturally, as analyzed by Myers (2014a). It might be possible to reach a point where wetland hydrology monitoring is no longer necessary, after the pit lake is totally developed. However, below the tailings impoundment, because of the drawdown to be caused by decreasing the seepage from the tails, wetlands could be dried for decades into the future (Myers 2014a). The SDEIS claims that the extensive wetlands have only minimal hydraulic connection to the underlying groundwater (p 4-46). This assumption was based on the mapping of ombrotrophic bogs rather than much hydrologic survey. Myers (2014a) found that recharge over the watersheds was several inches per year. It is very possible that the connectivity is highly heterogeneous, but the SDEIS has not sufficiently considered these issues.The SDEIS has also not adequately considered the hydraulic connections between the wetlands and underlying aquifers. Recommendation: The agencies should require Polymet to install shallow piezometers near and at distance from the mine site to consider whether there is a layer separating the surface from the aquifers. Reliance on Perfect Engineering There are many sources of potential contamination caused by this proposed project, including various waste rock and or stockpiles and ponds. The following figure is a snapshot from the SDEIS showing those sources at the mine site. The tailings impoundment is the primary source at the plant site. Table 5.2.2-19 summarizes the sources in Polymets modeling.

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The following passage from the SDEIS describes how Polymet relies on perfect implementation of engineering designs to prevent their discharges from exceeding standards. It has to work perfectly or the project may exceed many standards (Myers 2014b). For MPCA-recommended wild rice waters, the engineering controls would prevent an increase in sulfate concentrations in the Partridge River and would decrease sulfate concentrations in the Embarrass River. The proposed engineering controls would provide a high degree of reliability and flexibility to ensure that the evaluation criteria would continue to be met in the future, where nearly all contact/process water at the NorthMet Project area would be treated at the WWTF or the WWTP before release to the environment. At the Mine Site, only about 10 gpm of untreated water would be released during closure (all related to groundwater seepage), which represents less than 5 percent of total Mine Site water releases. At the Tailings Basin, only about 21 gpm of untreated water would be released during closure (all Tailings Basin seepage that bypasses the groundwater containment system), which represents less than 1 percent of total Tailings Basin water releases. The NorthMet Project Proposed Action is also not predicted to result in any significant changes to groundwater and surface water flows when compared to existing conditions. (p 5-8, emphasis added)

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The 10 gpm untreated release from the mine site would be from the West Pit into downgradient pathways and also small amounts of seepage that pass from waste rock stockpiles to downgradient groundwater pathways. The release from the West Pit is extremely low because Polymet has determined the downgradient conductivity in bedrock is extremely low. The other releases require perfect construction and design of stockpile liners. The 21 gpm release from the tails depends on the liner under the new tails and the containment systems, described above, operating perfectly. The modeling used to present results in the SDEIS relies on these designs working perfectly, with small variations considered to account for imperfections. If these fail at either site, their predictions are wrong and the project will degrade waters. Table 5.2.2-35 further demonstrates that most of the discharge from the site will be treated water from the WWTF. The WWTF discharge to the river is 290 gpm only after year 40. The flow rate from various sources is a small fraction of that and any load from those sources may take from 55 to 160 years to reach the river. Because the WWTF discharges to surface pathways, it dilutes any of the groundwater flowpaths. Recommendation: Polymet should expand their probabilistic modeling to include results assuming the liners/containment systems work poorly. Instead of 99% capture, they should test what occurs with as little as 10% captured. Also, they should consider what occurs if the capture fails for a given time period; this would be the equivalent of considering what would occur if a significant slug of contaminants escapes for a reasonable time period. The SDEIS claims that any water that escapes the Cat 1 stockpile would migrate to the West Pit. Based on the fact that there is a groundwater divide separating the upper reaches of the Partridge River from the lower reaches (near the confluence with the S Partridge River) and based on modeling in Myers (2014a), a portion of seepage escaping from the Cat 1 stockpile could flow to the upstream end of the river rather than to the pit. Recommendation: The modeling should include a flowpath north from the Cat 1 stockpile to the Partridge River. The flow path might be temporary, only existing early during operations and later during closure. Polymet should use their MODFLOW model to assess these time periods. See Myers (2014a). The Cat 1 stockpile and the tailings impoundment will be encircled by a groundwater containment system that would capture at least 90 percent of seepage. At the tailings impoundment, the SDEIS describes the containment system as a slurry wall keyed into bedrock and an upstream collection trench with permeable backfill and piping (p 5 -6). This design depends on the collection trench working perfectly, the bedrock being low permeability without fractures that would allow seepage to bypass the wall, and the wall being perfectly 16

keyed into the bedrock. If these fail, the mines plans will fail and more contaminants than predicted will reach the river. The containment system depends on the cutoff wall being properly constructed including its key into the bedrock, the drainage system that removes seepage not failing, and the bedrock actually being low permeability. The performance modeling reported in the SDEIS (p 3-46) would not show the capture efficiency if the bedrock were more fractured than assumed by Polymet. Myers (2014a) discusses why the bedrock probably has higher conductivity than modeled by Polymet. The construction of the cutoff wall and drainage system is discussed elsewhere (see report of Mike Malusis). Recommendation: Transport from the tailings should be modeled with two potential failures. The first is that the cutoff wall and/or pump system does not perform as designed. The modeling should consider the potential for the pump system to fail temporarily. The second is that the bedrock underlying the tailings could have higher conductivity than assumed for this modeling. The project proposes to use both a cutoff wall containment system and a cover to decrease seepage from the Cat 1 stockpile (p 3-46, 5-101). The containment system would be constructed during the first year of mining as waste rock is added to the pile. A cover would be added started in year 14 because that is the last year that waste rock would be added to the stockpile (it would be backfilled to the East Pit). The long-term efficacy of this project depends mightily on both of these systems working. Myers (2014a) considers the details of transport around the mine site if the stockpile seepage reduction does not work. Recommendation: Polymet should model transport from the Cat 1 stockpile with two potential failures. The first is that the cutoff wall and/or pump system does not perform as designed. The modeling should consider the potential for the pump system to fail temporarily. The second is that the bedrock underlying the stockpile could have higher conductivity than assumed for this modeling. SDEIS Figure 5.2.2-3 shows the MODFLOW modeling of the containment system around the Cat 1 stockpile. Specifically, it shows low-K cells surrounding a system of DRAIN cells that surrounds the proposed stockpile. This is the wrong way of modeling the cutoff wall because the thickness of the model cell would control the conductance through the cell. This figures shows the cutoff wall was modeled as having variable thickness and conductance, which is not realistic and is incorrect. The SDEIS does not specify the conductivity value, but if it is the value expected for a five-foot wall, having the model treat it as much thicker would be modeling it as much more impervious than it would be in reality. The variable size of the DRAIN cells might also affect the modeled ability to remove water because the conductance could be set equal to 17

the product of the long length of the cell and modeled conductivity, a value which could artificially increase the models ability to remove water. Recommendation: The cutoff wall should be simulated using the horizontal flow barrier package in MODFLOW. The DRAIN cell conductance should be set specifically avoiding the potential problems outlined herein. The cat 2/3 and 4 stockpiles are temporary features containing the various types of waste rock until it is backfilled into the East Pit (5-101). Polymet models these features with extremely low seepage rates assuming that the liners at their base will prevent seepage to the underlying soil and divert it to capture systems around the base of the stockpiles (Id.). The low predicted sulfate loads to the rivers depend on these liners working as designed. Recommendation: The temporary stockpiles should be simulated assuming the liner performs poorly to set a bound on the potential contamination. The MODFLOW model should be used to test assumptions that seepage from the Cat 4 stockpile will flow to the East Pit. The East Pit would be backfilled, with details as described on p 5-102. Beginning in operations year 10, stockpiled Cat 2/3 and 4 waste rock would be backfilled into the pit while groundwater will flow into and saturate the backfill (Id.). The pore water in the initially saturated backfill would have relatively high solute concentrations , but once submerged, oxygen transport would be limited and there would be a systematic decrease in oxidation and associated dissolution of sulfide minerals (Id.). The Water Modeling Data Package indicates that about 50,000 tons of sulfate would be backfilled into the pit, which would cause a concentration about ten times higher than the 2500 mg/l shown in Figure 5.2.2-18 (Myers 2014a). The limits in that figure, although not discussed at this point in the SDEIS, are due to concentration caps expected to be obtained by amending the backfill. Recommendation: Polymet should run a scenario wherein the concentration caps do not apply, because they depend on the correct addition of amendments to control the pH in the pit. Adding amendments after backfilling is complete is very difficult. Polymet will pump water into the West Pit during reclamation to fill it quickly, within 20 years of the end of operations (5-81). The pumped water includes both treated and untreated water, so water disposal may not be the purpose. It would limit oxidation of pit walls, but the untreated water to be pumped into it contains significant loads so it may not fulfill that objective. The SDEIS does not explain why this is being done. Myers (2014a) found that pumping the pit full caused a gradient for pit lake water to flow into the surrounding groundwater, but this is not considered in the Goldsim modeling. There is no real explanation or reasoning provided as to why they are pumping the pit full. 18

Recommendation: The SDEIS should compare the pros and cons of pumping the West Pit full with a clear explanation of why they are doing it. It could be considered an alternative mine plan. The project relies on submergence of Cat 2, 3, and 4 waste rock in the East Pit to prevent acid drainage, which they acknowledge is possible (p 5-5), but there are many problems with that. Polymet will pump water into the East Pit to keep it submerged and saturated. They also discuss that during reclamation they will pump water from the pit at 1750 gpm and treat it. They will keep the waste saturated at the same time. Myers (2014a and b) reviews the difficulties with achieving Polymets plans and presents some alternative modeling of the results SDEIS Figure 5.2.2-8 and associated text compares distributions of sulfide in waste rock at Polymet to sulfide in deposits around the world. The comparison is relatively useless without also including a comparison of the amount of AMD problems that occurred at those other sites. The SDEIS overlaps discussion of the tailings geochemistry and modeling (p 5-61 63). They apply two empirical correction factors to reduce sulfate concentrations to levels observed downgradient. The first was to match observed concentrations downgradient of the tailings (p 5-62, -63), as described in Attachment E. The second was adjustment, sometimes by reducing the concentrations by greater than 99% of the predicted concentration, to match observed concentrations in downgradient waters. The factors were listed in an obscure supporting document, the Water Model Workplan, Version 6. The SDEIS suggests this shows there is additional attenuation not accounted for by Goldsim modeling. The SDEIS assumes that runoff from various sources will be captured and potentially treated. For example, pond PW-OSLA would capture runoff from the overburden storage and laydown area (OSLA) (p 5-102). This water will be discharged to various places, with treatment if the water quality is not sufficient for discharge. The SDEIS does not describe plans for testing the water quality in this, or other ponds. The SDEIS does not disclose how Polymet will determine whether the water is suitable for discharge untreated. Recommendation: The SDEIS should include a discussion about how the water quality of temporary runoff ponds, such as pond PW-OSLA, will be monitored. This would include frequency of sampling and constituents to be sampled. Polymet will use bentonite amendments to surface material during operations and closure to reduce oxygen diffusion into the subsurface and thereby decrease contaminant release rates (p 5-63). Bentonite amendments are also referenced elsewhere (p ES-23, 3-4, 3-129, 5-81, 5162, 5-358, 5-562, Table 3.2-1). These are all claims as to the bentonite preventing oxygen 19

from passing, but there are no literature references to where this has been done or assurances that it will work and not even references to Polymet design documents regarding the issue. Recommendation: Provide evidence in the form of peer-reviewed studies or other assurances that bentonite amendments and covers can prevent the entry of oxygen to underlying material. This should prove that it will work essentially in perpetuity since that is the claim being made by Polymet and relied on by the agencies. Goldsim modeling of existing conditions uses calibrated values for seepage through portions of the tailings impoundment (Table 5.2.2-10). The calibration is from a MODFLOW model. The problem with converting the seepage rates modeled at the bottom of the tails to a recharge rate at the top of the tails is that it assumes vertical flow through the tails. Because there is ponding on certain levels, it is possible there is a horizontal gradient which would cause flow among tailings basin subareas. Recommendation: Polymet should redo the modeling to accurately account for flow among subareas and use the amended bottom seepage rates for inflow to the Goldsim modeling. Evaluation Thresholds The evaluation threshold for water quality has been chosen to be the P90 value, or 90% exceedence (p ES-35). This means that 90% of the simulated results were less than this value. However, the SDEIS describes it as there being at least a 90 percent probability that a constituent would not exceed water quality evaluation criteria (p 5 -7). This requires the huge caveat that it applies only if all of the conceptualizations of flow and transport are accurate and all of the probability distributions are accurate. Myers (2014) provided evidence that suggest many of the base parameters used in the modeling are not correct. This provides a false sense of security in the predictions. Recommendation: The SDEIS should not call the P90 value the value for which there is a 90% chance it will not be exceeded without adding based on the assumption of the modeling. There are no standards for groundwater drawdown (5-9). The ultimate effect is whether the drawdown affects resources on the surface, specifically wetlands or streamflow. This has been addressed above. However, once the effects manifest on the surface, it may be difficult to counter them. Recommendation: The agencies should require detailed monitoring of the water levels in the shallow aquifers to provide advance warning of any impacts as they are occurring or before they affect the water level on the surface. 20

The SDEIS lists many surface water statistics that can be tracked to assess changes due to the project (5-13, -14). However, there are no binding compliance standards, so there is no level of impact that exceeds standards. They recommend that stream flows not be changed more than plus or minus 20% (5-14). This is not standard. Flow changes due to the project could cause concentration evaluation criteria to be exceeded but the water quality modeling (Polymet 2013a and b) does not simulate changes in flows due to the project. Recommendation: If it is not being done, the concentration modeling should account for decreased flow in the river and streams. Summary The SDEIS for the proposed NorthMet Mine essentially predicts there will be no negative water quality impacts or that the project will improve the existing water quality. It also predicts that any negative changes in river flow rates or wetland water levels will be mitigated by flow augmentation with water from Colby Lakes or with water from either the waste water treatment facility or treatment plant. Or, the modeling relies on assumptions like sorption and concentration caps to assure that the load discharging from the facility is not too high. It is all planned to work perfectly or the modeling assumptions render many of the effects unimportant. The assumptions are essentially the problem with this SDEIS. The range in potential design or construction flaws is considered using a probability distribution of seepage values, but the range is limited to very good installation and performance. Very little consideration is given to what could occur when something goes significantly wrong, as it inevitably does. This SDEIS does not consider the full range of potential problems that could occur at this site, especially considering that the design features must operate as designed in perpetuity. It does not adequately disclose the potential range in water quality and water quantity impacts that could result from this project over the next 200 to 500 year and beyond. References Barr Engineering (Barr) 2008. RS22B 0 Mine Site odel Report, Appendix B: Groundwater Modeling of the NorthMet Mine Site. Draft02. St. Paul MN. Foose MP, Cooper RW (1978) Preliminary geologic report on the Harris Lake area, Northeastern Minnesota. USGS Open File Report 78-385. Kruse G (2013) Office Memorandum Re: Partridge River Base Flow Analysis MDNR Gage #H03155002

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Myers T (2014a) Groundwater Flow and Transport Modeling, NorthMet Mine and Plant Site. Prepared for the Minnesota Center for Environmental Advocacy. Myers T (2014b) Review of the Water Quality Modeling, NorthMet Mine and Plant Site, Minnesota. Prepared for Minnesota Center for Environmental Advocacy.

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