By JOHN R. WILKE
April 21, 2007; Page A1
SUPERIOR, Ariz. -- As they dig for nickel, copper and other commodities in the far corners of the earth, the world's largest mining companies, Rio Tinto PLC and BHP Billiton Ltd., are used to solving geological problems. Here, though, the problems they encountered were political.
North America's largest copper lode is believed to be buried more than a mile beneath Apache Leap, the stark red cliffs that loom above this storied Old West town about an hour east of Phoenix. Resolution Copper Co., a joint venture between Rio Tinto and BHP Billiton, wants to mine it. But first it needs Congress to approve a federal land exchange, under which Resolution would swap 5,000 acres of private land for 3,000 acres of public land near its planned mine.
In exchange for supporting the bill, the local congressman, Rick Renzi, a Republican, insisted on something in return: He wanted Resolution to buy, as part of the land swap, a 480-acre alfalfa field near his hometown of Sierra Vista, according to documents and people involved in the deal.
Resolution executives refused. For starters, they thought the land was overpriced, people close to the deal say. More troubling, they discovered it was owned by Mr. Renzi's former business partner, these people say.
Resolution wasn't the only party troubled by the congressman's demands. His chief of staff resigned and began cooperating secretly with the Federal Bureau of Investigation, according to witnesses and others close to the case. The FBI began a preliminary inquiry that was first reported in October, just before Mr. Renzi was elected to a third term.