“In 2013, Chevron Mining, Inc. (“CMI”) filed a CERCLA (Comprehensive Environmental Response, Compensation, and Liability Act, also known also as Superfund) lawsuit against the United States Government to recover a portion of CMI’s past and future remediation costs at its molybdenum mine (formerly under Molycorp) in Questa, New Mexico (the Questa Mine).

The Questa Mine is on the Superfund National Priorities List, and CMI is currently conducting remedial and reclamation activities while it continues to work with U.S. Environmental Protection Agency (EPA) to establish the specific remedies that will be implemented at the Questa Mine in the future. The primary issue to be addressed is the reclamation of rock piles created by open pit mining operations and the collection, treatment, and monitoring of groundwater. The piles must be regraded to an acceptable angle of repose and revegetated.

In July 2017, the 10th Circuit held that the USG is liable under CERCLA based on its prior ownership of certain lands in and around Questa. The case was then remanded to the trial court for a determination of the percentage of liability the USG should be assigned.

On June 28, 2022 Judge Paul J. Kelly, Senior Judge, of the United States District Court for the District of New Mexico in Albuquerque issued a Declaratory Judgment after a March 2022 bench trial. In the Declaratory Judgment, Judge Kelly concluded that “30 percent of all past and future eligible response costs are allocated to the United States and 70 percent of all past and future eligible response costs are allocated to Chevron.”

Judge Kelly issued several findings of fact including that, “Without the encouragement and involvement of the United States, Molycorp’s Open Pit Mine and Second Underground Mine likely would not have been developed.”

We are pleased that Judge Kelly agreed with Chevron that the U.S. Government should bear a significant amount of the past and future costs associated with the remediation of the Questa Mine based on the U.S. Government’s ownership of relevant land in and around the mine, as well as its active participation in the development of the open pit mine and the placement of the resulting waste rock piles. Chevron remains committed to implementing the ongoing remediation and reclamation projects and will continue to work with the EPA to ensure the remedial work meets all applicable regulatory standards.