Mine infrastructure needs are many

Posted: Friday, April 08, 2005

Building and operating a mine on the Pebble porphyry northwest of Iliamna isn't a matter of opening the earth and extracting its wealth. The mine's future location is miles from a port capable of handling its output for shipment out of Alaska.

Northern Dynasty Mines Inc., the Anchorage-based American company that owns the property, will need the help of the state in constructing roads and perhaps a slurry pipeline to tidewater, a distance of about 75 miles.

In addition, the project will require electrical energy in great quantities, perhaps as much as 200 megawatts to cover peak operational loads and 100 megawatts peak load during construction. The company and Homer Electric Association are engaged in an ongoing joint study of the power supply question.

Available on the Alaska Department of Transportation and Public Facilities Web site is a map showing possible road routes being looked at by planners. Two generally follow the existing Williamsport to Pile Bay Village road. Two others would take a more northerly route from Iniskin Bay around Sugarloaf Mountain to Pedro Bay and on toward the mine with alternate routes just north of Iliamna.

That same map shows four possible port sites being investigated.

A benefit-cost analysis of the roadwork was to begin in March. Final reconnaissance engineering is to be completed by August, according to the DOT Web site. The roads also would serve area villages and provide easier access to that region of Alaska.

Mining companies spend significant risk capital to explore, find permit, engineer, develop and operate a mine, said Northern Dynasty's Chief Operating Officer Bruce Jenkins.

"The history is that infrastructure related to mine construction and operation, that is roads, ports and power, is something already in existence, or is built and funded by the local jurisdiction to encourage that investment and development of those jurisdictional resources," Jenkins said.

"Our expectation when we came to Alaska last year and announced we were going from exploration to development was the same generic expectation we have in any other jurisdiction."

Jenkins said it was too early to determine what infrastructure would be needed or how it would be financed and built.

"We haven't even designed the project yet," he said. "People are getting ahead of themselves on the project, in part probably because of our fault."

Northern Dynasty's commitment to an open dialogue with stakeholders about what it is doing, what preliminary plans and concepts look like, he said, led people to overreact and conclude the concept discussions were a reflection of reality of a completed project.

"I'm sorry, but that's not the case," he said. "But I would make the same mistake again, because I would rather have that problem and have reached out to stakeholders and interested parties than to have stayed in behind the office doors and not said anything to anybody."

Jenkins said the company has nothing to hide and would continue engaging with the public.

Criticisms and concerns are "the nature of the game," he said.

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