Nevada Mining and Minerals
Nevada Leads the Nation in Mining
Mining has been and continues to be vital to Nevada’s economy. The BLM Nevada solid minerals program consists of locatable minerals, such as gold and silver, and is the only state producing lithium, which is quickly becoming the “gold rush” of the 21st century due to its value for use in emerging technologies in stored energy.
Nevada has the largest mineral materials program in the Bureau for sand and gravel and crushed stone, used in construction supporting the fast-growing population centers of Las Vegas and Reno, which is a vital contributor to the economic well-being of the state, producing 5 million cubic yards of sand/gravel valued at $11.4 million in 2015.
BLM Nevada also has an active solid leasable minerals program for sodium, potassium, and other important leasable minerals.
Overall, Nevada leads the nation with the largest mining program in the BLM, with more than 180,000 active mining claims (49% of the BLM total), 198 authorized mining plans of operations, and 282 active exploration notices. With a strong ethic towards effective and successful reclamation, BLM Nevada holds and administers more than $2 billion in surface management reclamation bonds.
The BLM Nevada minerals program has responsibilities and adjudicative duties associated with federal mining claims, mineral surveys and patents, validation of title of evidence, review of mineral validity reports, service of federal minerals contest actions, guidance of surface use management (43 CFR 3809) and use and occupancy under the mining laws (43 CFR 3715). BLM Nevada also processes mineral material disposal applications, solid mineral prospecting permits, mineral lease applications and bonding documentation.
In Nevada, BLM also manages the minerals estate on approximately 300,000 acres of split-estate lands. The term split-estate (federal minerals) refers to federal mineral rights under private surface lands. These are patented lands with minerals reserved to the United States. These reservations and may be for single, multiple, or all minerals.
BLM Nevada Bonding
Financial Guarantees Required for Exploration and Mining under the 1872 Mining Law
The Bureau of Land Management (BLM) manages more than 245 million acres of public lands and 700 million acres of subsurface minerals nationwide. According to the Federal Land Policy and Management Act of 1976, these public lands are to remain under the stewardship of the Federal Government, unless disposal is in the national interest, and are to be managed according to the principles of multiple use and sustained yield. Therefore, the BLM manages the public lands for a combination of uses, taking into account the long-term needs of future generations for renewable and nonrenewable resources. These resources include recreation; range; timber; minerals; watersheds; fish and wildlife habitat; and natural, scenic, scientific, and cultural values.
Certain uses of the public lands must conform to requirements in applicable laws and regulations. Hardrock mining is one such use. Mineral exploration and extraction activities that disturb the surface of the land are subject to surface management regulations (43 CFR 3809). For any activity beyond casual use, as defined in the regulations, you are required to file a notice of your operations or a plan of operations (plan) with the BLM. You, or your designated operator, are also responsible for reclamation of any land that you disturb, for which you must submit a cost estimate and a financial guarantee to the BLM. The term “financial guarantee” refers to any required contractual document and financial instrument used to guarantee that an operator will perform reclamation as required by the regulations. These contractual documents are commonly referred to as bonds. This handout is frequently asked questions and BLM Nevada’s response to those questions. It does not address the process for reviewing your reclamation cost estimate or when you may begin operations, which are handled by the Field Office where you filed your notice or plan.
Frequently Asked Questions
1. What is a bond?
A bond is a written contract to guarantee the lands disturbed from hardrock mining activities will be reclaimed. A bond is required for any notice or a plan that is filed according to the surface management regulations at 43 CFR 3809.
2. What is a performance bond?
The general type of bond required by the BLM is a performance bond, which “protects against loss due to the inability or refusal of an operator to perform the required reclamation.” There are two types of performance bonds you may submit to guarantee reclamation as described in your notice or plan – a personal bond or a surety bond.
3. What is a personal bond? How do I obtain one and submit it to the BLM?
A personal bond is, “a written document in which the obligor (operator) formally recognizes an obligation to pay money or to do a specific act.” You must complete BLM Form 3809-2, “Surface Management Personal Bond,” and obtain one of the following acceptable financial instruments from a bank, credit union, or Federal savings and loan, as stated in the regulations at (43 CFR 3809.555):
a guaranteed remittance in US dollars; for example, a cashier’s check, a money order, cash, or an official bank check a certificate of deposit/time deposit an irrevocable letter of credit U.S. Treasury securities (bills, notes, or bonds)
19. How will I know when my bond has been accepted?
The BLM Nevada State Office reviews and processes the bond and financial instrument you submitted to ensure the documents satisfy the bonding requirements and protect the interests of the taxpayer. The BLM will issue a decision of its findings, which is sent to the bond principal, the surety, the bank, the operator, the BLM Field Office, the State, and others, as required. If necessary, the BLM State Office will contact the surety, the bond principal, the bank, and others as required to obtain additional information as needed for a satisfactory bond.
20. If the BLM reduces my required bond amount, do I have to submit a new bond?
No, you do not have to submit a new bond in the reduced amount. The amount obligated under your current bond(s) will be reduced by the BLM State Office and you will then have an uncommitted bond amount available for additional operations. If you want a refund of the uncommitted bond amount, send a written request to the BLM State Office. Some financial instruments can be reduced (letter of credit) while others cannot be reduced (CD or other fixed-time deposit accounts). The amount of the bond you submit is entirely up to you as long as the amount of the bond meets the minimum bond amount required for reclamation as determined by the authorized officer of the BLM Field Office.
21. When can I begin operations?
Only the BLM Field Manager is authorized to tell you when you may begin surface disturbance under notice-level operations or a plan of operations or a modification of such. However, under no circumstances may you disturb the surface of public lands until a satisfactory bond is accepted and bond monies have been obligated by the BLM State Office for the designated notice or plan. A plan of operations must also be approved by the BLM Field Office.
22. What are the bond forms? Where can I get the bond forms and other bond information? Are they available on a web site?
Bond forms and other bond information may be obtained from any BLM office. “Fillable” forms are also available on BLM’s web site at https://www.blm.gov/services/national-operations-center/electronic-forms. The forms are listed by both number and program area. In some applications, the BLM form numbers appear with two zeroes (“00”) in the end of the number. For example, in Forms Central, BLM Form “3809-1” is BLM Form “3809-001.”
BLM Form 3809-1 – Surface Management Surety Bond
BLM Form 3809-2 – Surface Management Personal Bond
BLM Form 3809-4 – Form for Bond Extending Coverage of Bond to Assume Liabilities for Operations Conducted by Parties Other Than the Principal (Consent of Surety) Rider
BLM Form 3809-4a – Surface Management Personal Bond Rider
BLM Form 3809-5 – Notification of Change of Operator and Assumption of Past Liability
23. If I sell my operations, what do I need to do?
If you are transferring your notice or plan of operations to another entity, complete BLM Form 3809-5, Notification of Change of Operator and Assumption of Past Liability, and submit it to the BLM Field Office. Call the BLM Field Office administering the lands where your operations are located for other requirements concerning a transfer of the notice or plan of operations.
16. How long does it take to get a bond accepted?
In most cases, the documents (BLM Form 3809-1 or BLM Form 3809-2 and the financial instrument) will be examined within 2 days of receipt by the BLM Nevada State Office. If the documents are found to be satisfactory, a bond acceptance decision will be issued. Acceptance may take longer if additional information is needed from the BLM Field Office or the State or if the bond or the financial instrument needs correction by the principal, the financial institution, the surety, or other parties.
17. Can a “cash” bond be processed faster than other personal bonds or a surety bond?
A “cash” bond is a personal bond (BLM Form 3809-2) that is secured by a guaranteed remittance in US dollars (such as a cashier’s check, certified check, official bank check, money order, wire transfer, credit card payment, or cash). The guaranteed remittances are deposited by BLM into a Federal depository account.
Acceptance of a “cash” bond can still be delayed if additional information is required or corrections need to be made. Be advised that a bond submitted with a personal check (including a company check) or a foreign check will be returned to you without action being taken by the BLM.
18. What may cause additional information to be required or the bond to be rejected?
The coverage of the bond is missing or conflicting the bond was executed by a person not appearing to have the authority to financially bind the bond principal the written amount of the bond is missing or is not spelled correctly the bond signature(s) are missing or not properly notarized the bond was submitted on a bond form which is dated before January 2004 the bond principal is not the operator of record according to the notice or plan of
operations that has been filed with the BLM Field Office submissions that are not satisfactory for bonding operations conducted under the regulations at 43 CFR 3809
- you change the coverage of the personal bond from individual coverage (single operation) to statewide or nationwide coverage (use BLM Form 3809-4a)
- you add an operator as a co-principal to your personal bond (use BLM Form 3809-4a)
- the bond (BLM Form 3809-2) is from the operator, but the financial instrument securing the bond (for example, a letter of credit) is not from the
operator. In this case, the entity providing the financial pledge to secure the bond, the remitter, should also complete and submit BLM Form 3809-4a - the bond for a surety bond (BLM Form 3809-1, Surface Management Surety Bond) or the bond for a personal bond (BLM Form 3809-2, Surface Management Personal Bond) and the financial instrument are not from the operator. In this case you need to include BLM Form 3809-4, Form for Bond Extending Coverage of Bond to Assume Liabilities for Operations Conducted by Parties Other Than the Principal (Consent of Surety) Rider, which has been signed by the person supplying the bond
The signatory on a personal bond must be acknowledged by a notary. The bond and corresponding financial instrument (which may be sent by the bank) does not have to be submitted to the BLM at the same time.
4. What is a surety bond? How do I obtain one and submit it to the BLM?
A suretyship (surety) bond is “a contractual arrangement among the surety, the principal (operator), and the obligee (BLM) whereby the surety agrees to protect the obligee if the principal defaults in performing the principal’s contractual obligations (reclamation). The bond is the instrument which binds the surety.” You should contact an insurance agent to find a federally acceptable surety company and you must complete BLM Form 3809-1, “Surface Management Surety Bond.” A corporate surety must be certified by the U.S. Department of the Treasury (see Treasury Circular 570). Surety bonds must be accompanied by the surety’s power of attorney.
For material changes to a surety bond, the surety company must submit a change rider.
5. Must the operator be on the bond?
The “operator,” as named in the notice or plan of operations filed with the BLM Field Office having jurisdiction over the lands where the operations are situated, must be covered by the bond. The operator must be the bond principal, a bonded co-principal, or covered by a bond that is submitted by another entity (third-party bond). A third-party bond must include a completed bond rider from the third party (BLM Form 3809-4, Form for Bond Extending Coverage of Bond to Assume Liabilities for Operations Conducted by Parties Other Than the Principal (Consent of Surety) Rider), which identifies the operator as being covered under the bond. Please note that the person you named as the “contact” for the operator is not the “operator.”
6. Who is the bond principal?
The bond principal is defined as, “the person (legal entity) primarily liable, for whose performance of their obligation the guarantor or the surety has become bound.” The operator is primarily liable for reclamation on the operations and the operator is typically the bond principal.
7. Who should execute (sign) the bond?
The bond must be executed (signed) by the bond principal. Typically, the bond principal is the operator, in which case, the bond must be executed by the operator. When the operator is a corporation, partnership, or other legal business entity, the bond must be executed by an officer of the corporation or other position which has the authority to financially bind the operator. The signatory authority must be according to a current power-of-attorney or the articles of incorporation or other business documents as may be filed with the BLM Nevada State Office.
If the bond is posted by an entity on behalf of the operator, known as a third-party bond, the third party would execute the bond. In addition to the bond, BLM Form 3809-4 must be submitted, which shows the third party is posting the bond with the BLM on behalf of the operator of record.
An agent, resident agent, trustee, owner of the mining claim, or other such individual is not an acceptable signatory for a bond unless there is a specific legal designation, such as a power-of-attorney, which gives the individual the capacity to financially bind the operator. The operator remains financially responsible for reclamation of the operations, no matter who executes the bond.
8. What must the bond guarantee?
The bond must guarantee reclamation as described in the notice or plan.
9. Where do I submit my bond?
The surety bond or the personal bond and financial assurance can be sent either by mail or courier service or delivered in person to the BLM Nevada State Office as shown below. The financial assurance may be sent separately by the bank. Personally delivering the bond to the BLM will not change the bond acceptance time.
Mail or Courier Service to:
BLM Nevada State Office
Branch of Minerals Adjudication
1340 Financial Blvd.
Reno, NV 89502-7147
10. When do I submit my bond?
You may submit a bond anytime before you begin surface-disturbing activities. You do not have to wait for the BLM Field Office to review your reclamation cost estimate or to send you a determination of the required bond amount before you submit your bond to the BLM Nevada State Office. Acceptance of your bond can occur before BLM’s review of your notice or plan of operations or before the required bond amount is determined by the BLM Field Office. After the required bond amount for a notice or a plan of operations is determined by the BLM Field Office, any bond amount previously committed will be adjusted by the Nevada State Office, if necessary and if funds are available. For this reason, you may want to submit more than you estimated to allow for a higher amount that may be required by the BLM Field Office after reviewing the reclamation cost estimate.
11. How much of the required bond amount do I need to submit?
Your bond must be in an amount at least equal to the reclamation cost estimate as determined by the BLM Field Office for your notice or plan of operations. The required bond amount is expressed in whole dollars. Additionally, the BLM Washington Office has set policy that the required bond amount will be rounded up to the nearest dollar for a reclamation cost estimate ending in $0.50 or more and rounded down to the nearest dollar for a reclamation cost estimate ending in less than $0.50. For example, a reclamation cost estimate of $7,157.50 would result in a minimum required bond amount of $7,158. And, a reclamation cost estimate of $7,157.49 would result in a minimum required bond amount of $7,157.
You can submit a bond for more than the amount required. If you have an uncommitted balance on the bond, it can be applied toward an increase to the bond requirement in the future without requiring additional information or paperwork from you.
12. How many bonds can I submit? How can I increase my bond?
The operator’s bonding requirement may be met by a single bond, by a single bond with multiple financial instruments, such as more than one cash payment, or by multiple bonds. Multiple bonds may be accepted from various entities.
If you wish to increase your bond or an increase is required and no funds remain available under your current bond, you may submit an additional bond or you may submit a rider (BLM Form 3809-4a) and additional funds to increase the current bond.
13. Can I submit a statewide or a nationwide bond?
Yes. Any operator can submit a bond for any coverage – individual, statewide, or nationwide – that the operator desires. An individual bond covers only a single operation. A statewide bond can cover any and all of your operations in one state up to the amount of the bond. A nationwide bond can cover any and all of your operations in more than one state.
The amount of a statewide or nationwide bond must be sufficient to cover the reclamation of all the operations to which it applies.
A change in the bond coverage, for example from individual to statewide coverage, can be accomplished by submitting a rider (BLM Form 3809-4a) to an existing bond; filing a new bond is not required.
14. If I have a bond with an unobligated or uncommitted balance and the BLM has determined the obligated bond amount for my new or existing operations is inadequate, do I need to ask the BLM to apply additional funds from the unobligated amount my bond?
No. If there is an uncommitted balance under your existing bond that is available to be obligated, the BLM will automatically obligate additional funds from your bond for a reclamation cost increase required for existing operations or for newly filed operations upon our determination of the necessary additional bond amount by the BLM Field Office.
15. What is a rider and when might I need one?
A rider is a document that attaches to the bond, as part of the bond, which must be submitted to the BLM for material changes to the bond. These changes may include the following: you decrease or increase the amount of a personal bond (use BLM Form 3809-4a “Surface Management Personal Bond Rider”)