Abrasive commissioner nearly scuppers New Mexico garnet facility

By James Sean Dickson, Josie Shillito
Published: Thursday, 28 May 2015

Burrell Western will now be able to develop its facility as originally stated, after the local county commission board approved its plan for a garnet processing plant in New Mexico. Further rejection could have seen the facility moved to Texas.

In a case that demonstrates how important local politics can be to industrial mineral developments, US-based Burrell Western Resources has finally been approved for a city tax break to aid the construction of a garnet processing facility in Oro Grande, New Mexico, after an earlier county commission board did not approve the plan.

Allowed in mid-April, Burrell Western could have seen its planned 100,000 tpa garnet facility plans scrapped in favour of a move to Texas on the basis of a single vote on the three-member committee board – and because of philosophical objections.

Garnet is consumed in small amounts compared to refractory minerals like magnesia and alumina, with its buyers typically working in specialist refractory applications. The silicate group mineral is also used as an abrasive and in high pressure water jet material cutting equipment by companies like Apple Inc. and other electronics manufacturers to ensure smooth surface edges on cut metals and glass.

Commissioner Janet White, who blocked the proposed garnet plant in the first committee vote in early April, justified her action to vote against the proposals by stating that if Burrell Western is to receive a property tax incentive, all other businesses in the area should have the same privilege.

"I have heard no opposition to the Burrell garnet operation as a private enterprise, none whatsoever," White told local paper Alamgordo Daily News.  

"[But] is granting property tax and compensating tax relief a proper role [of government]? No. In my opinion and of my constituents, (…) it is not the proper role of government, not unless the commission is willing to offer this to all businesses," she said.

"Our first order of business is to reduce taxes and barriers to business. That’s how you will get what I call intrinsic sustainable economic development," White added.

Owing to a small time window for land procurement, Burrell Western had been worried that it would be forced to build the plant at a reserve location in Texas. The project is expected to consist of an open pit mine, which would require roads, trucks and "light equipment".

Preliminary drilling results suggest that the indicated garnet resources at Burrell Western’s project, the location for which remains undisclosed, totals 2.5m tonnes, with an estimated mine life of between 25 and 50 years, and total revenues of $1bn.

News 14  

One of the largest user applications for garnet is as an
abrasive. Fine garnet dust can be mixed into water jets
to ensure smooth cut edges.  
Source: James Sean Dickson, Flickr 

Reversal of fortunes

At the second committee vote in mid-April, fellow commissioner Ronny Rardin joined the three board members and voted in favour of Burrell Western receiving taxable industrial revenue bonds, which amount to the property tax incentive mentioned by White.

Rardin apologised to the board for missing the last meeting, and stated his support for the project, which he said would create jobs and local revenues and use unoccupied land.

He said that if the commission does not forge a deal, they would not be taking advantage of state laws that local committees can use to encourage developments.

Chamber of Commerce president Mike Espiritu was reported as saying: "It is ludicrous – [the plant project] is not costing them [the commissioners and the city] anything."

Susan Flores, the final board member, had originally voted for the proposal, but the lack of a second meant that the proposal could not be carried.

David Buchholtz, an attorney at Rodey Law Firm, told Alamgordo Daily News that the company will now need to focus on procedural notices and finish negotiations with the lieu of taxes. 

US garnet industry

Garnet for industrial use is currently produced by three companies in the US – one based in Idaho and two based in New York State, according to the US Geological Survey (USGS), for a total of 193,000 apparent domestically consumed tonnes.

A substantial proportion of this – 177,000 tonnes – is imported, with just under 90% coming from Australia (45%) and India (43%).

The total value of mined crude garnet in 2014 was $5.48m, while refined material sold or used had a total value of $8.83m, the survey said.

Garnet is found in a wide range of rocks, but it is generally only mined when additional material found in association with the mineral – like mica, kyanite and marble – can also be monetised.

In 2014, world garnet production totalled 1.66m tonnes, the USGS said.