HERSEY, MI -- A Colorado businessman could extract more than 725 million gallons of mid-Michigan groundwater per year under plans to mine a rich deposit of potash southwest of Evart.
Records show Theodore Pagano's Michigan Potash Co. LLC was approved by state regulators to use roughly 1.98 million gallons of water per day in a proposed solution mining operation sited in the heart of an Osceola County wetland complex.
The Michigan Department of Environmental Quality approved Pagano's withdrawal last fall, but the state is holding a public hearing next week in Evart on the mine's application for several wastewater disposal injection wells.
The $700 million mine project's approved water withdrawal would surpass the quantity Nestle wants to extract from the same watershed by more than three times, although Pagano says the mine would recycle large quantiles and use less than what's allowed.
Potash is a potassium-rich salt commodity valuable as crop fertilizer. The mine would use the fresh water to create a hot brine that dissolves potash underground. After it's brought to the surface and separated, the waste brine would be injected deep underground.
Mark Snow, a permit supervisor with the DEQ oil, gas and minerals division, said there's been little public input on the injection wells.
"We've only really had a handful of comments," he said. "I say less than six. About half are in support and have that have concerns."
The public hearing is March 12 in Evart. Public comment deadline is March 19, but "I wouldn't preclude extending it," Snow said.
"At this point, we really haven't gotten a lot of comment."
Pagano, of Lakewood, Colo., is in final permitting stages for his potash project, which began in 2013 after he discovered mineral-rich drilling core samples housed at the Michigan Geological Survey warehouse at Western Michigan University.
The Environmental Protection Agency approved Pagano's solution mining and injection well permits in 2016 and 2017.
The project is not widely known beyond industry circles and the local area, where there's debate among residents weighing potential economic benefits with the environmental risk.
During a June 2017 meeting in Evart, Pagano said he was working "quietly behind the scenes until the time was ultimately right and all the potential check boxes" were ready.
He predicts the mine will create 170 full-time jobs.
The Evart Local Development Finance Authority supports the mine.
"If this group is successful in developing their project, the opportunity for business development in this town and other surrounding towns will have large potential impact," board member Bob Barnes said.
The Michigan Citizens for Water Conservation opposes the project, which would inject sulfide brine underneath aquifers that local homeowners tap for drinking water. The group worries that the injection could force brine up through rock fissures or old mineral exploration boreholes in the area.
Jeff Osthowski, MCWC vice president, said Pagano's application is predicated on site data from a nearby mine which is "more than 30 years old."
The state injection well permits don't have renewal provisions or a total injection volume cap, he said.
"Once you're permitted, you're permitted forever."
Osthowski said the proposed injection wells and manufacturing plant are surrounded by wetlands that would be inundated with salty brines by a spill. Why build in the middle of wetlands when "Pagano has more than 10,000 acres of land in five townships in Osceola and Mecosta counties under mineral lease?"
The group also questions Pagano's ability to run the mine after his failed Dakota Salts potash project was bought by Sirius Minerals of London and shelved.
The MCWC and neighbors are also concerned the 1,300 gallons of water Pagano is approved to withdrawal per minute will hurt the Muskegon River watershed.
Mine expansion plans include additional injection wells.
"How much he ultimately ends up using is anyone's guess," said Doug Miller, who lives on a wetland lake within the permitted mining area.
Neighbors want Pagano to post a bond that would cover nearby drinking water wells or pay for environmental cleanup.
They argue Pagano's $30,000 bond for eventual injection well abandonment lets the state off the hook but offers no insurance to surrounding property owners.
"My concern is this stuff is going to get injected under my property," said Ken Ford, a forester who lives near the proposed mine.
"These so-called 'non-hazardous' waste brines -- when they spread them on the road around here, it kills everything," Ford said.
Pagano disputes the threat proposed by the injection wells and said the facilities would feature spill capture technologies. Brine would be injected underneath a confining layer that separates the wastewater from overlying aquifers. He said the brine would be "food grade" and largely filled with magnesium and calcium.
"Is there a threat to drinking water? I'd say absolutely not," he said. At 8,000 feet, "we're so deep. Your deepest drinking water supply source is roughly 200 feet."
Although he's approved for significant quantities of water extraction, he said one well is solely for backup and the operation would recycle as much water as possible in a "closed loop" distillate system.
"We'll utilize less than a single irrigation pivot, ultimately," he said.
"In turn, we can supply all the potash fertilizer needs for Michigan, most of Indiana and northern Ohio," he said. "Our water use is not conceptually high provided the amount of industrial production that we provide back."
Pagano says potash mining is not new to the area. West of his property, Cargill operates a salt solution mining operation that formerly produced potash. Pagano has tapped several contractors who built that facility for his venture.
The 400 million-year-old Borgen Bed deposit is located about 5,000 feet underground. In 2016, the U.S. Geological Survey estimated its market value at roughly $65 billion. Pagano says it's the purest potash vein in North America, possibly the world.
The potash cores in Kalamazoo were drilled in the 1990s and early 2000s by Dow Chemical, which was looking to for minerals to use in chemical manufacturing, according to WMU geologists.
Pagano has been securing mineral rights from local landowners for several years. The manufacturing plant would be located on the northeast corner of Scofield Road and 120th Avenue in Evart Township and would require road widening for semi-truck access.
"We're not operating differently than what's been operated a mile and half away, which did pretty well over the course of 30 years," he said. "But, were capable now of employing new and improved technologies."
Snow said Pagano still needs to obtain DEQ permits for pollution discharge, wetlands destruction and erosion control, as well as local construction permits. The DEQ already approved an air pollution permit.
The DEQ is not under a deadline to approve the injection wells.
Pagano said the project could break ground this year if all the permitting stars align. Project financing is dependent on permits.
Monday's public hearing will be 6 to 9 p.m. at Evart Middle School. Public comments can be emailed to DEQ-OGMDpubliccomments@michigan.gov or mailed to
Michigan DEQ, Oil, Gas, and Minerals Division, P.O. Box 30256, Lansing, MI 48909. Submissions are due March 19.