Still years away from filing for its first mining permit, Northern Dynasty Mines Inc. continues work on its broad-ranging baseline environmental studies program in anticipation of answering the concerns of a skeptical public with what the company hopes will be provable scientific fact.
The company is also engaged in a public relations campaign to promote what would become one of the largest such mines in the world.
Tuesday, Northern Dynasty’s Stakeholder Relations Manager Heidi Franklin spoke to a luncheon of the Support Industry Alliance’s Kenai chapter at Paradisos Restaurant and gave an update of the project northwest if Iliamna, and an overview of the environmental study and the exploratory drilling programs under way since 2002.
“By the time we are done with our baseline studies we will have a very clear understanding of everything that buzzes, grows, glows, smells, or moves out in that area,” she said. “There really is no other project in the state that has done this much baseline study other than the pipeline.”
Reiterating the company’s stated policy of developing the Pebble Project in a way that would conserve the local environment and benefit the local and broader community, she presented slides showing how exploratory drilling is done using helicopters to transfer rigging, haul out core samples and move personnel, thus eliminating, at least for now, the need for roads across the tundra. She also showed an example of how the disturbed tundra is being repaired after sampling drill rigs have been moved to new locations.
The environmental baseline study includes establishing surface water monitoring stations, surveying and sampling of fish, and surveying to delineate area wetlands.
According to information distributed at the Alliance luncheon, Northern Dynasty has drilled some 490 holes since 2002. That is in addition to the 125 drilled by Cominco, the project’s previous owner. Since 2002, roughly 12.5 acres have been disturbed, most of it already reclaimed. Franklin said most of the reclamation work has been done by local hires.
Recent mineral discoveries to the east of the site proposed for an open pit mine have expanded the project greatly. Today, it is divided into Pebble West and Pebble East. The eastern deposits are deep, and likely won’t involve open-pit strip mining, but will be accessed via tunnels instead. An open pit mine is still planned for Pebble West that will require building two giant tailings dams for collected mine wastes.
The latest estimates indicate Pebble West may produce 24.6 billion pounds of copper, 42.1 million ounces of gold and 1.35 billion pounds of molybdenum. Meanwhile, at Pebble East, where only inferred resources have been calculated, there are at least 24.3 billion pounds of copper, 22.1 million ounces of gold and 1.5 billion pounds of molybdenum, Franklin said.
Northern Dynasty Mines Inc. is the American subsidiary of Northern Dynasty Mineral Ltd., a Canadian company that is part of a group of resource development companies making up the Vancouver, British Columbia-based Hunter Dickinson Inc. The American firm expects to train and hire significant numbers of Alaskans in the coming years.
Michelle Brunner, Northern Dynasty’s Business and Workforce Development Manager, told the luncheon the company, for instance, had an ongoing program training people to protect drill workers from roaming bears, a regional reality in the summer.
“There are a lot of bears that are starting to wake up,” she said.
She also mentioned ongoing scholarship programs and educational efforts conducted with various training facilities and schools, including the University of Alaska. Last year, much of Northern Dynasty’s workforce was composed of Alaskans, Brunner said, including 125 hired from within the mining region. At this time, on site or at Iliamna, there are 92 workers. Thirty are from the Bristol Bay region, she said.
About 2,000 workers will be needed to construct the mine, and about 1,000 to operate it. The mine could last as long as 80 years.
Northern Dynasty is still a long way from filing for the state and federal permits it will need to construct the mine and start hauling away deposits. Brunner said would likely be 2009 or beyond before the first permits are sought.
Franklin noted the efforts of groups organizing to oppose the mine who perceive threats from mining operations to the Bristol Bay Watershed and the valuable fisheries it supports. But, 80 percent of the sockeye catch and escapement comes from regional watersheds not hydrologically connected to the Pebble Project, she said. Nevertheless, the project will stand or fall on the strength of collected scientific data. The only thing Northern Dynasty is guaranteed now is due process, she said.
The demand for metals worldwide is growing rapidly. By 2016, she said, the world will need 28 Pebble-sized mines just to supply enough copper. Currently, there are only about five mines at Pebble’s stage, she added.
By the time the mine is operational, some $1 billion to $3 billion will have been invested, and there will be hundreds of millions of dollars spent in annual operating expenses. Tens of millions in annual tax revenues will derive from the project for perhaps 60 to 80 years if current deposit estimates prove out, she said.
Franklin answered a few questions from the audience, including one about how the mine produce would be handled. She said there are no plans for using the cyanide leach process, which is known to be environmentally hazardous.
Northern Dynasty Mines and its parent Northern Dynasty Minerals are “juniors,” companies that explore for deposits and find investors, but which do not actually operate mines. For that Northern Dynasty is negotiating with several mining companies, called “majors.” Confidentiality agreements prevented Franklin from discussing with which companies and how many Northern Dynasty is currently talking.
She did say signs were looking good and that the company could have a significant announcement to make later this year.
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