A canoer paddles on one of the many waterways in Minnesota’s Boundary Waters Canoe Area Wilderness. The Obama administration denied renewing two mining leases near the area Thursday, on the grounds that any future mining operation could contaminate the region’s pristine watershed. (Dave Freeman)

This post has been updated.

The Obama administration on Thursday rejected a mining company’s request to renew a lease on the southwest border of Minnesota’s Boundary Waters Canoe Area Wilderness, setting in motion a formal review to examine whether all mining activities in 234,000 acres abutting the wilderness should be barred for the next 20 years.

The joint decision by the Agriculture and Interior departments, which found that the region’s ecological richness and unusual hydrology merited special protection from a possible $3 billion copper-nickel mine, highlights the extent to which the president is determined to exercise his executive authority with just a month left in office. While the move by the Bureau of Land Management and the U.S. Forest Service does not constitute a rule, it effectively halts construction of any mine in the region and triggers a detailed scientific and policy review of future operations there.

“The Boundary Waters is a natural treasure, special to the 150,000 who canoe, fish, and recreate there each year, and is the economic life blood to local business that depend on a pristine natural resource,” Agriculture Secretary Tom Vilsack said in a joint statement with Interior Secretary Sally Jewell. “I have asked Interior to take a time out, conduct a careful environmental analysis and engage the public on whether future mining should be authorized on any federal land next door to the Boundary Waters.”

The wilderness area, which spans nearly 1.1 million acres along the Canadian border, is one of the most visited of its kind in the United States. It boasts lakes and streams dating from the Pleistocene Epoch, 100 species of migratory birds and an active fishery.

Twin Metals Minnesota, a subsidiary of the Chilean mining giant Antofagasta, holds two expired mineral leases dating to 1966. It applied for their renewal in 2012, and federal officials held two listening sessions in the state this summer and received more than 30,000 comments. Minnesota Gov. Mark Dayton (D) came out against renewal, as did Minnesotan and former vice president Walter Mondale.

“Today’s best available science is helping us understand the value of the land and water and potential impacts of development in places like the Boundary Waters,” Jewell said. “This is the right action to take to avoid irrevocably damaging this watershed and its recreation-based economy, while also taking the time and space to review whether to further protect the area from all new mining.”

While Twin Metals is considering building the copper-nickel mine, it has not made any formal proposal and has not begun the federal or state permitting process. In a statement Thursday, the company said it was “greatly disappointed” in the administration’s actions.

“If allowed to stand, [they] will have a devastating impact on the future economy of the Iron Range and all of Minnesota, eliminating the promise of thousands of good-paying jobs and billions of dollars in investment in the region,” the statement said. “Further, this unprecedented decision is contrary to the overwhelming majority of local and regional citizens and communities who support mining and believe mining can be done responsibly in this region.”

Northern Minnesota has been home to iron mining for decades, but a sulfide-ore mine has never been built in this part of the state. Such mines can leach toxic metals, and because the water in the region flows south to north, activists and federal officials have expressed concern that any spill from the mine could contaminate more than 1,200 miles of streams.

A coalition of outdoors enthusiasts, veterans, local businesses and environmentalists has argued that the leases were issued before the federal government established the modern regulatory review standards that now apply to such activities. Both are in the Superior National Forest adjacent to the wilderness area. The Forest Service oversees the surface land there, while the BLM controls the minerals underneath.

Luke Popovich, a spokesman for the National Mining Association, said Thursday that his group strongly opposes the lease-renewal process as “arbitrary and unjustified” and supports evaluation of a mine proposal through the usual permitting process.

Interior will issue a notice in the Federal Register that it intends to “segregate” the lands, which puts them off limits to development for up to two years, subject to valid existing rights. Once the notice is published, there will be a 90-day public review for the proposed withdrawal and additional scientific environmental analysis. That will entail more public meetings.

The next administration would have the option of revisiting Thursday’s decision, though any unilateral termination of the review would likely prompt a backlash from activists.

The area is the only large lake-land wilderness in the National Wilderness Preservation System. When Congress established it, lawmakers directed the Forest Service to maintain its water quality, protect its fish and wildlife and minimize the environmental impacts associated with mineral development. A portion of it was designated in 1964, the year the Wilderness Act passed, and a much larger area was designated by Congress in 1978.

Jamie Williams, president of the Wilderness Society, issued a statement saying his group applauded both the Forest Service’s recommendation against the leases’ renewal and Interior’s decision to study whether the region’s watershed “is the wrong place for sulfide-ore copper mining.” He said the area should be “protected for all time.”

“First conserved for its wilderness values 90 years ago, the Boundary Waters is one of the original treasures protected by the 1964 Wilderness Act,” Williams said. “It has been a favorite destination for millions of Americans who marvel at its unique waterways and forests and is a vital component of Minnesota’s economy.”

Becky Rom, national chair of the Campaign to Save the Boundary Waters, described the administration’s decision as “a strong first step, but there is still a lot of work to do to ensure we can protect the [wilderness area] for future generations.”

But Rep. Rick Nolan (R-Minn.), however, said in a statement the move meant “Minnesota’s Iron Range got a real slap in the face and a punch in the gut by Washington bureaucrats” and ran contrary to the compromise struck when the wilderness was expanded in 1978.

“This law established the area as predominantly non-motorized, taking millions of acres of lands out of valuable production,” Nolan said. “The law explicitly reserved lands outside of [the wilderness] in the Superior National Forest for forestry, and management plans were established that included mining and mineral exploration, which was designated a “desirable activity.’”