The Alaska Contractor - Summer 2008

$95 million on the property and plan
to spend about $140 million this year.
At current metal prices, the publicly
released resource estimates at Pebble
show that the deposit contains about
$450 billion worth of copper, gold and
molybdenum.
Pebble’s developers, Northern Dynasty
Minerals and Anglo American,
are investing substantial time and
money into preparing an environmental
baseline document, expected
to be finalized in the first quarter of
2009. That document “…will be used
to evaluate various mine design alternatives
prior to the submission of
a proposed development plan for permitting,”
said Northern Dynasty, in an
April 2008 news release. “Once begun,
permitting for the Pebble Project will
proceed under a rigorous and transparent
process set out under the National
Environmental Policy Act, including
the completion of an Environmental
Impact Statement (EIS).”
Those plans to seek federal and
state regulatory approval for Pebble
would likely be nixed, should the ballot
initiative be passed by state voters
and implemented as proposed.
The initiative applies the new water
and waste handling rules to “large
scale metallic mineral mining operations,”
which are defined in size by an
operation that exceeds 640 acres of
land, according to the proposals.
That size calculation includes all
components of a mining project, including
the actual mine site, processing
facilities, ore treatment facilities
and waste storage; support facilities
to include roads, transmission lines,
pipelines and separation facilities;
treatment plants or equipment connected
with the project and any tunneling,
shaft-sinking, quarrying or rock
excavation for other purposes, such as
construction of water or roadway tunnels,
drains or underground sites for
housing industrial plants.
In 2007, Alaska had six large-scale
operating mines contributing to the
state’s mining industry value – of
which most would surpass the 640acre
size criteria included in the proposed
new rules.
Mining industry advocates say the
proposed rules could end up including
some placer gold mine operations,
specifically by the initiatives’ language
that includes mine support and ancillary
facilities and transportation access
routes that, in remote areas, can
include airfields and roads linking the
mine to the airfield.
The remaining initiative includes
sections that state the new rules would
not apply to existing large-scale metallic
mining operations that have received
all required federal, state and
local permits before the new regulations
become effective. It includes an
additional phrase saying it would not
apply to “future operations of existing
facilities at those sites.”
But large-scale mine operations
covered by the proposed new rules
typically expand and update operational
plans and seek revised regulatory
approvals throughout the mine
life as the operation advances.
“The problem is, a mine never has
all the permits to operate throughout
the mine life,” said Lorna Shaw, executive
director of the Council of Alaska
Producers, a mining industry advocate
organization. “A mine doesn’t open,
knowing it will be around for 50 years.
Exploration is a continuous process. A
mining company finds enough ore to
build a mine, then continues exploration
to continue the mine…different
opportunities present themselves in
different stages of the mine life.”
Until recently, Shaw worked fulltime
at Alaska’s largest gold mine, Fort
Knox, located about 20 miles northeast
of Fairbanks. The open-pit, hard rock
mine and mill complex, producing
gold since 1996, has already surpassed
its original end-of-mine-life projection
of eight years, through discovery of additional
ore in the existing mine pit and
from satellite deposit sources nearby.
Just last year, Fort Knox received
state and federal regulatory approvals
to add a new, lower-cost processing
facility to the mine’s existing operation.
Construction of a valley heap
leach began in late 2007, a new facility
which will allow Fort Knox to extract
gold from rock that formerly was considered
waste, because the amount
of mineralization was so low that it
could not be economically processed
through the existing mill.
Combined with a 500- to 600-foot
pit expansion to the west, called Phase
7, the new heap leach will add about
seven more years of operational life