Libby Asbestos

History / Background

The Libby Asbestos Superfund Site is located in northwestern Montana near the town of Libby. The Zonolite Company began mining vermiculite at the site in the 1920s and the mine was purchased by W.R. Grace in 1963. W.R. Grace operated the mine until its closure in 1990. During operation, the mine produced approximately 80% of the world’s supply of vermiculite. Vermiculite from Libby was contaminated with a toxic and highly friable form of asbestos, often referred to as Libby Amphibole asbestos.

The Environmental Protection Agency (EPA) began investigating the site in 1999 in response to public concern over exposure to asbestos from the mine. In 2000, EPA began removal actions at the site, and it was added to the Superfund program National Priorities List in 2002. EPA declared a public health emergency in Libby in 2009, the first time EPA had done this in the history of the agency, to allow those affected to receive federal health care assistance.

The site consists of eight operable units (OUs), including the export plant (OU1), the screening plant and areas impacted by it (OU2), the Zonolite Mountain Mine (OU3), the town of Libby (OU4), the former Stimson Lumber Company property (OU5), Burlington Northern Santa Fe (BNSF) railroad property (OU6), the city of Troy (OU7), and highway corridors (OU8). With the exception of OU3, all remedial actions at the site have been completed and operations and maintenance are ongoing.

OU3 consists of the former Zonolite Mountain Mine area and the surrounding property where contamination has come to be located. This includes portions of Rainy Creek, Carney Creek, Fleetwood Creek, and the Kootenai River, as well as the Kootenai Development Impoundment Dam (KDID), where seepage water and fine tailings from the milling process were collected. Asbestos fibers were released from the site through the mining and milling process, tailings run-off, transportation of materials, and asbestos-containing waste. Non-asbestos contaminants are also present in OU3 from the mining and milling process, various chemical reagents used in processing, and an historic landfill. Releases of these hazardous substances affected the air, soil, surface water, riparian areas, wetlands, groundwater, sediment, and pore water in and around the mine site. Aquatic and terrestrial habitat in the mine area were impacted, as well as wildlife that use these habitats for feeding and reproduction. NRDP has also alleged that the hazardous substances resulted in lost recreational use, as well as other natural resource services.

W.R. Grace is conducting cleanup of the mine site with oversight by EPA in consultation with the Montana Department of Environmental Quality (DEQ). The Remedial Investigation was completed in 2016 and the feasibility study is currently being developed. EPA expects to reach a Record of Decision in 2026.

In 2023, the State of Montana (DEQ and the Natural Resource Damage Program [NRDP]) entered into a settlement agreement that resolved the remainder of the State’s claims in W.R. Grace’s bankruptcy. The settlement agreement included $18.5 million in natural resource damages to be paid out over 10 years, with the first payment due to the State in September 2023.

Settlement/Consent Decree

In March 2023, the U.S. Bankruptcy Court for the District of Delaware entered a settlement agreement https://dojmt.gov/wp-content/uploads/Libby-Asbestos-Settlement-Agreement-rs.pdf that resolved the remainder of DEQ’s amended proof of claim in W.R. Grace’s Chapter 11 bankruptcy case for the Libby Asbestos Superfund Site. The settlement resolves the natural resource damage liability of Grace and other affiliated companies to the State of Montana for the Libby Asbestos Superfund Site and requires Grace to provide the State with financial assurance for the KDID, amongst other provisions.

The settlement agreement included $18.5 million (plus interest) in natural resource damages to be paid to the State over 10 years. The first $5 million is due to the State September 19, 2023, and the rest is to be paid out in $1.5 million annual installments (plus 4.19% interest) for 9 years. In exchange, the State releases all natural resource damage claims, except in the event of catastrophic failure of the KDID.

As required by the settlement, the money must be used, “solely to restore, replace, rehabilitate, or acquire the equivalent of injured natural resources and services in or related to OU3 or the Lincoln County area, and support therefor, including costs for State restoration plan development and implementation, and administrative, program, legal, technical, and all other related costs, to the extent lawful under CERCLA or CECRA…”

The money cannot be spent on the on the CERCLA response actions (cleanup) at the Libby Asbestos site. Those actions must be performed by W.R. Grace for OU3, and the EPA and DEQ settlements for the other operable units. This settlement cannot be used for any future DEQ cost-share or operation and maintenance obligations under CERCLA.

What's New

The Settlement Agreement was entered March 23, 2023. The first payment ($5 million) from W.R. Grace was paid to the State in October 2023 and remaining payments ($1.5 million plus interest) are expected in April of each for the next 9 years.

Next Steps

Under CERCLA and CECRA (federal and State Superfund), a restoration plan is required for settlement funds to be spent on restoration actions. Restoration plan development involves public input and comment and for the Trustee (Governor of Montana) to consider the public comment and sign the plan. This plan will be developed after the final remedy (cleanup) for Operable Unit 3 (the mine site plus other areas) is selected and the $18.5 million has been received by NRDP. There will be a significant public involvement process, consisting of public meetings, requests for input from the community, local government, and stakeholders, and public comment on draft documents.

Since the final remedy for Operable Unit 3 is several years in the future, NRDP plans to develop an interim restoration plan for the Libby Asbestos OU3 settlement that will describe management practices and use of the funds prior to development of the final Restoration Plan. This interim restoration plan may include use of some of the settlement funds on “early restoration” before the entire settlement has been received to start addressing the injured resources and lost uses. Early restoration requires scoping and public comment and generally identifies one or a few projects rather than addressing use of all of the settlement funds.

NRDP will be working with community members, local government, state agencies, and other stakeholders to begin to scope and solicit for potential early restoration projects, subject to approval by the Trustee. This process will involve opportunities for community engagement through meetings and commenting on draft documenhttps://dojmt.gov/lands/contact-nrdp/nrdp-mail-sign-up/ts. If you would like to be informed of the progress on this work, please sign up for our mailing list at https://dojmt.gov/nrdp/mail-sign-up/