Hannah McHardy holds a greenish-gray rock in her hands and peels it apart to reveal the flaky fibers of a potentially deadly mineral: asbestos.

The 24-year-old Sterling College graduate has come to Belvidere Mountain in northern Vermont for a look inside the old asbestos mine she has studied for two years. Joining McHardy is her faculty adviser, Sterling College professor Charlotte Rosendahl, a native of Denmark whose father died of asbestos-related disease.

Their tour guide is Howard Manosh, a Lamoille County businessman dressed in a John Deere hat, blue jeans and red flannel shirt. Manosh was president of the mining company when it shut down in 1993, after the mineral’s links to cancer and lung disease essentially killed the demand for it.

In its heyday, the Vermont Asbestos Group mine on the Lowell-Eden line was the largest producer of chrysotile asbestos in the world. The mineral was used in brake pads and floor and ceiling tiles, and crushed rock from the site was used to build roads in Vermont.

The mine once employed more than 300 people, who worked around the clock scooping rock and hauling it to the huge crushers and ovens that would extract the valuable asbestos.

“You’d go up there at night and the place was lit up like a city,” recalls Manosh, who bought into Vermont Asbestos Group and became its president in 1978.

Today, Belvidere Mountain is an unmitigated toxic-waste site. Wind and water are eroding two gigantic mounds of asbestos tailings — one on the Lowell side and one in Eden — polluting streams and wetlands around the mountain. Though airborne levels remain low, the asbestos is destroying wetlands habitat and the creatures living in it.

The estimated cleanup cost ranges from $129 million to $200 million, depending on the method, and the Vermont Agency of Natural Resources and federal Environmental Protection Agency still haven’t decided how they’re going to contain the pollutants.

Options under consideration involve flattening the tailings piles with bulldozers and covering the mounds with 1.5 million tons of soil. With 50 million tons of material spread across 1500 acres, every option is as complex as it is expensive.

McHardy, who graduated in May with a degree in conservation ecology, has been researching a less conventional solution: using fungi already present at the site to “bioremediate” the mine. For the past two years, she’s been looking into the potential for naturally occurring fungi spores to break down asbestos fibers and render them less harmful.

Bioremediation isn’t fringe science. The EPA employs the process — which uses microorganisms, fungi, and green plants and their enzymes to change harmful chemicals into water, methane, carbon monoxide and less dangerous gases — at 50 Superfund sites. Where appropriate, the EPA favors bioremediation because it is often both cheaper than conventional cleanup methods and more acceptable to the public.

A chrysotile asbestos mine in Italy, which is geologically similar to the one in Vermont, has been experimenting with the same fungal remediation McHardy is advocating.

When McHardy brought her research to the attention of state and federal environmental officials in charge of the mine site, none was familiar with the experiments under way in Italy. But Manosh wanted to hear all about it. He put up $10,000 of his own money so that McHardy and Rosendahl could continue their research.

“I think it’s neat,” Manosh says nonchalantly.

Manosh has a financial interest in finding a cheaper solution, too. A 2009 settlement reached in bankruptcy court commits the company to pay 8.6 percent of the cleanup costs, up to $300 million. As a stakeholder in the company, Manosh could be liable to pick up part of the tab.

Without Manosh’s investment, McHardy and Rosendahl say their research would have run out of funding. Instead, they’ve been able to detect eight species of fungi from soil samples taken from the mine. Earlier this month, McHardy flew out to Southern Utah University, where she used the school’s DNA sequencer to positively identify three fungi species that have the potential to change the morphology of the needlelike asbestos. They do so by removing the magnesium, iron and silica from the chrysotile fibers.

“I think more and more scientists are finding that by looking at nature’s processes you can find ways of cleaning up messes … that are a lot more efficient and a lot less money,” McHardy says.

Approaching the mine from Route 100 on a chilly October morning, the tailings piles look like gigantic warts jutting out of the mountainside. Past an entrance gate plastered with “No Trespassing” signs is what looks like a ghost town — rusting metal buildings, soaring conveyor belts that once moved crushed stone up the mountain and earth-moving machinery left in place. The only inhabitants are a caretaker, a Rottweiler named T-Bone, and the occasional hunter or ATV rider who sneaks onto the land.

As Manosh maneuvers his SUV over the mine’s gravel roads, McHardy spies a hillside of green moss and asks him to pull over. Grabbing a reusable plastic shopping bag from Manosh’s vehicle, she and Rosendahl dig their hands eagerly into the dirt and scoop up samples of lime-green moss to take home for lab analysis. Moss isn’t what they were looking for, but they’re interested in any sign of life in the barren mine site.

Few people would take such pleasure in dredging carcinogenic dirt from a polluted old mine, but McHardy isn’t your average college grad. Her environmental education began at the age of 2, when her mother took her to a big march to clean up Lake Pontchartrain in New Orleans. At 17, McHardy moved to the Pacific Northwest, fell in love with the region’s endangered old-growth rainforest and founded the Seattle Rainforest Action Group. Her work earned her the prestigious Brower Youth Award for young environmentalists from the California-based Earth Island Institute.

McHardy wanted a “hands-on” college experience and learned about Sterling from a rep who visited her high school in Seattle. The decision to attend was made easier when she qualified for the school’s Environmental Stewardship Scholarship.

McHardy decided to make the asbestos mine at Belvidere Mountain the subject of her senior applied-research project. She’d read newspaper articles about a 2008 Vermont Department of Health study that found elevated levels of asbestosis — a respiratory disease brought on by inhaling asbestos fibers — in people living within 10 miles of the mine. To McHardy, the situation joined two interests — bioremediation and environmental justice — and she closely followed the health study and its aftermath.

Skeptical about the health department’s claims, Eden resident Leslie White and others dug into the state’s data and quickly discredited the findings by showing the sick individuals either worked at the mine or had probably contracted the disease elsewhere. The state was forced to retract the report.

But the water-pollution problem is real: From Belvidere Mountain flow several rivers and streams with elevated levels of asbestos. State and federal officials have only begun to tackle the huge cleanup required at the mine, says the Department of Environmental Conservation’s John Schmeltzer, co-project manager for the site. In 2007 and 2008, the EPA constructed diversion channels and rock berms to halt erosion from the tailings piles. That’s helped reduce the volume of asbestos-laced sediment getting into waterways, Schmeltzer says, but it’s not a permanent fix.

Presently, the state is experimenting with revegetating the site to stabilize the slopes with root systems. In August, several “test plots” were covered with three inches of compost, gypsum and fertilizer to see if grass will grow. Sprouts have started to show already, Schmeltzer says.

“It seems like, for them, erosion is the biggest thing and doing what they are proposing to do would remediate that,” Rosendahl says of the test plots. “It won’t really change what’s happening out there. There will still be asbestos under the soil, but it will be held in place. With bioremediation, it’s changing something to be less hazardous.”

Schmeltzer met with McHardy and Rosendahl last spring to hear about their research.

“We look forward to reviewing their results when this research project is completed,” he says, adding that the DEC is reserving judgment on the potential for fungal bioremediation until McHardy’s research is complete.

The DEC is pushing to put the mine on the National Priorities List for Superfund status, but won’t make a formal request to the EPA until getting buy in from residents in Lowell and Eden. Schmeltzer says the state has neither the expertise nor the funds to clean up the site by itself.

Five cleanup scenarios outlined in a state report entitled “Program Case for Pursuing Superfund Listing of the VAG Mine” are all mammoth, both in scope and cost. Plans envision moving 3.5 million cubic yards of tailings from the Eden pile and 16 million cubic yards from the Lowell pile; placing 1.5 million tons of soil over 383 acres of tailings; and maintaining and monitoring the site for up to 200 years.

This winter, the state will hold community meetings in Lowell and Eden to solicit feedback from residents on the Superfund question. Leslie White, for one, isn’t convinced that Superfund status is the way to go. The tailings piles have developed a magnesium-carbonate “crust” several inches thick, White says, and disturbing the pile to haul it away could kick the asbestos airborne.

“We just want to make sure that, when they choose a fix, it’s an appropriate fix to the problem, and that the money they spend is money worth spending,” says White, who is part of a citizen group called the Franklin Lamoille Orleans Alliance.

Whatever the chosen solution, it is probably years off. Even if McHardy’s research shows that fungi present at the mine could break down asbestos, it could take decades for the neutralization process to actually work, she says.

Once it’s cleaned up, Manosh has a long-term idea for the site you won’t find in any official government plan: line the mountain with wind turbines.

“The aesthetics are ruined, anyway,” he says.