Oak Flat campground in Arizona’s Tonto National Forest. Photo © Bob Wizeman
The U.S. Forest Service manages 4,300 campgrounds coast-to-coast. One of them has a history of politics, power, intrigue and indictments involving some of our nation’s most powerful figures, including one now seeking the Oval Office.
Oak Flat Campground, in Arizona’s Tonto National Forest, has sixteen campsites, two toilets, a scattering of oak trees and lots of boulders on which climbers like to practice. But it’s not what’s on the surface that makes Oak Flat so special. For that, you’ve got to look 7,000 feet underground.
Below Oak Flat lies North America’s largest known deposit of copper. Resolution Copper Mining, a marriage between the mining giants Rio Tinto PLC and BHP Billiton, Ltd., expects to spend $2.5 billion to extract and process that ore. The return on its investment will also be huge: 600,000 tons a year of refined copper (equal to 30 percent of U.S. consumption) for forty years. At today’s prices—about $6,000 per ton—that’s more than $144 billion in revenue; for a profit of $141.5 billion.
But Resolution Copper has a problem. It has staked claims to the copper lode on federal land surrounding Oak Flat, but the campground itself has some protection. Fifty-three years ago, President Eisenhower signed an order prohibiting mining on Oak Flat. That order remains in effect today.
Resolution seeks what is called a legislated land exchange to overturn Eisenhower’s order and acquire Oak Flat. Legislated land exchanges are a popular corporate tactic because they circumvent public servants who insist on obtaining fair-market-value appraisals and environmental reviews. A legislated exchange can be arranged simply by persuading a few key members of Congress that it’s in their political best interests to sign off on the deal.
Thus was born the Southeast Arizona Land Exchange and Conservation Act, introduced in 2005 by Arizona Representative Rick Renzi. The Act would have swapped 3,000 acres of federal land—including Oak Flat—for about 5,000 acres of “biologically diverse properties” owned by Resolution.
This past February, Renzi was indicted on thirty-five counts of conspiracy, wire fraud, money laundering, extortion and insurance fraud. The indictment alleges that Renzi told Resolution Copper that he would use his position on the House Resources Committee to move the land exchange bill through Congress, but only if Resolution agreed to buy an alfalfa field and include it in the deal. According to the indictment, Resolution shied away after it learned the pasture was owned by Renzi’s former business partner, James Sandlin (an indicted co-conspirator). The indictment alleges that Renzi threatened Resolution Copper: “No Sandlin property, no bill.”
Renzi then allegedly persuaded former Arizona Governor Bruce Babbitt and his investment partners to buy the 480-acre field for $4.6 million, in exchange for Renzi’s support of a land exchange that would expand Arizona’s Petrified Forest National Park. Shortly after the alfalfa land sale closed, Sandlin allegedly paid Renzi $733,000 from the sale to repay a business debt.
Renzi, until recently Senator John McCain’s presidential campaign co-chair in Arizona, denies all allegations against him, but says he will not seek reelection and has stepped down from his committee assignments. Babbitt’s group, whose Petrified Forest land exchange appears to be petrified in Congress, is now trying to unload an alfalfa pasture it has no interest in owning.
Presidential aspirant McCain is co-sponsor of the 2007 version of the Southeast Arizona Land Exchange. The bill would transfer to Resolution Copper the 3,025-acre Oak Flat campground tract, including the multi-billion-dollar mineral estate beneath it. In exchange, the public would receive 4,583 acres—none of which is known to have valuable minerals underground—and $7.5 million. Thank you, Senator McCain.