A Twin Cities environmental group demanded on Thursday that state regulators impose a new clean-up plan on the owner of an abandoned iron ore pit south of Ely that has been leaking toxins into nearby waters for decades.

Environmentalists say the pit is a sort of test case for the way regulators and mining companies will handle environmental risks at much larger mining operations proposed for the Iron Range in coming years.

The Dunka Pit, a 1,200-acre site on the edge of Birch Lake near the Boundary Waters wilderness, was created by an old iron mining operation. But unlike many other idled operations nearby, it contains the same kind of sulphur-producing rock that would be processed in two massive copper-nickel mining operations that are now in the planning phase.

The waste piles in the Dunka Pit are leaking acid, sulfates, toxic metals and other pollutants into wetlands and near-by streams, according to documents from the Minnesota Pollution Control Agency (MPCA).

Last year, after pressure by a number of environmental groups, the agency entered into a legal agreement with the company that now owns the property, Cleveland-based Cliffs Natural Resources. The company paid a $58,000 fine and agreed to a schedule of data collection and specific reductions in pollution, said Ann Foss, the MPCA's director of strategic projects.

But some of the toxic levels in the site's runoff are so high that the company could not meet state and federal standards, she said.

"They are taking steps to bring down the levels of those pollutants," she said.

When they've achieved those goals and regulators have determined appropriate new limits, the MPCA will issue the company a new permit, she said.

Officials from Cleveland Cliffs declined to comment.

But Paula Maccabee, an attorney with WaterLegacy in St. Paul, said in a letter to the MPCA on Thursday that the pollution standards the agency is using are insufficient to protect water quality and wildlife.

"It's time to get the pollution cleaned up," she said. She wants the MPCA to accelerate the regulatory process and issue a permit that adheres strictly to state and federal standards for those pollutants.

Environmental groups say the regulatory history of the Dunka Pit is an example of lax enforcement policy at the MPCA.

"We've been concerned about the overall level of enforcement work by the MPCA," said Scott Strand, executive director of the Minnesota Center for Environmental Advocacy, a nonprofit law firm.

Maccabee said it's critical that the agency and the mining companies proposing much bigger operations with greater environmental risks be held to a high standard now.

PolyMet Mining is planning a $600 million open-pit copper-nickel mine near Babbitt, Minn., and Duluth Metals Ltd. is planning a much larger one closer to the Dunka Pit.

Josephine Marcotty • 612-673-7394