Contingent Valuation of Some Externalities from Mine Dewatering

Abstract

We assess the economic impacts of some externalities from mine dewatering using the discrete choice version of the contingent valuation method. “Dewatering” refers to the pumping of ground water from areas surrounding mines. Our focus is on the dewatering being conducted by the large open-pit gold mines located in the Humboldt River basin of northern Nevada and its downstream impacts. Results indicate that in the short term the mines have created a positive externality for downstream parties. In the long term downstream impacts may be negative, but upstream “pit lakes” will be created that may have some value to users, depending on the lakes' quality.