Judge halts expansion of Mosaic mine in Florida

The Plymouth fertilizer giant said it could be forced to permanently close the phosphate mine next month and lay off 221..

August 3, 2010 at 5:10AM

A federal judge in Florida has dealt fertilizer giant Mosaic Co. a blow by ruling that the expansion of a large mine in Florida would likely violate the federal Clean Water Act.

U.S. District Judge Henry Lee Adams late Friday issued a preliminary injunction to halt expansion of the phosphate mine in Fort Meade, Fla.

Plymouth-based Mosaic on Monday appealed Adams' decision, but said it would be forced to indefinitely shut down the mine in September, laying off 221 workers.

The Sierra Club and two other environmental groups last month sued the U.S. Army Corps of Engineers, contesting its issuance of a wetlands permit for the extension of Mosaic's mine and asking that the expansion be stopped.

Adams wrote that Mosaic and the corps didn't look hard enough at less environmentally damaging alternatives for the mine expansion. Adams remanded the wetlands permit back to the Army Corps for further review.

"Without a preliminary injunction, plaintiffs and the environment will suffer irreparable harm which outweighs any harm to the defendants," he wrote.

Mosaic executives say the permitting process with the Army Corps was "exhaustive," and claim that further mining at its South Fort Meade operation isn't economically viable without the extension.

Three of the mine's four drag lines, massive machines that strip away topsoil to extract ore, are idled and waiting to get at phosphate reserves in the extension. Reserves in the original mine are close to being exhausted.

"Regrettably, we have no reasonable alternative but to shut down South Fort Meade," Mosaic Chief Executive James Prokopanko told analysts in a conference call Monday.

The mine is set to be idled Sept. 12 if Mosaic isn't permitted to mine the extension by then.

Mosaic, which is 64 percent owned by Cargill Inc., bills itself as the world's largest producer of concentrated phosphate fertilizer and animal feed ingredients. South Fort Meade is the second biggest of five Mosaic mines in central Florida, accounting for 32 percent of the company's phosphate production in its last fiscal year.

In the "worst-case scenario," if the South Fort Meade mine is shut down in mid-September, Mosaic's phosphate production in the second half of its fiscal year could fall 1 million tons short of expectations, Chief Financial Officer Larry Stranghoener told analysts. That could translate into a $250 million to $350 million reduction in operating earnings.

Mosaic executives made their comments to analysts after the market closed Monday. The company's stock was at $49.11, down 28 cents, in after-hours trading.

Mike Hughlett • 612-673-7003

about the writer

about the writer

Mike Hughlett

Reporter

Mike Hughlett covers energy and other topics for the Minnesota Star Tribune, where he has worked since 2010. Before that he was a reporter at newspapers in Chicago, St. Paul, New Orleans and Duluth.

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