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Mine reps get warm reception on peninsula

Posted: Friday, June 18, 2004

If the public interest shown earlier this week is any indication, enthusiasm about a proposed gold and copper mine north of Lake Iliamna may be running as high among many Kenai Peninsula residents as it is in the board room of the mining company itself.

After a two-day tour of the Kenai Peninsula, representatives of Northern Dynasty Mines, who are planning to launch what may become one of the largest gold and copper mining operations in North America, said the level of public interest in the project really struck them. Beyond that, they said they were very impressed by the existing concentration of available infrastructure the roads, docks, ports, harbors, airports and support industries and the vocational education opportunities.

"Quite frankly, we had a tremendous tour of the Kenai Peninsula," said Bruce Jenkins, director of corporate affairs for Northern Dynasty. "We were overwhelmed by the hospitality and professionalism of the tour and the wide range of parties and infrastructure that exist that could help our project."

Jenkins took particular note of the "peaceful coexistence" between natural resource development and the peninsula's tourism and fishing industries, calling it "a model example" for North America. He also said the company was impressed by educational and vocational training facilities available on the peninsula, which could prove important in job training for the construction and operations phase of the project.

"It was a good first visit," said Bill Popp, the Kenai Peninsula Borough's liaison to the oil and gas industry who helped facilitate the two-day visit by Northern Dynasty representatives. "The got a strong look at the broad picture of how the Kenai Peninsula Borough can support their project."

The visit began early Monday in Homer where company officials met with city officials and representatives of the borough's Community and Economic Development Division. Northern Dynasty officials spoke before a packed Homer Chamber of Commerce luncheon and answered questions from area residents about aspects of the proposed mine. After touring Homer facilities, the group headed to the central peninsula, ending Monday with a reception in Kenai hosted by the city of Kenai and the Kenai Chamber of Commerce.

The following day the tour continued, as Northern Dynasty officials saw the Nikiski industrial complex, Kenai Airport facilities, and fire, mining and petroleum training facilities, as well as Kenai Peninsula College. They also met with representatives to the Kenai Peninsula Borough School District to discuss the future of work force development.

"From my perspective, they were overwhelmed by the positive attitude of businesses and individuals regarding their project," said CEDD Business Manager Jack Brown. "In Kenai, it was standing-room only. The trip couldn't have went any better."

Company representatives were especially impressed with the level of interest expressed by the local support industry and local governments and by the local infrastructure, Popp said.

"It was a real eye-opener for them," he said. "They had had a sense of it, but not as broad a sense as they had when they left."

Vital to the mining project will be a supply of energy, and Northern Dynasty is keenly interested in developing a relationship with companies in the Railbelt power grid, Popp said. For that reason, Homer Electric Association is "strategically positioned," he said.

Northern Dynasty announced plans earlier this winter to further study the Pebble mineral deposit, which is situated 19 miles northwest of Iliamna on state land. Initial drillings have shown the mine may contain up to 26.5 million ounces of gold and 16.5 million pounds of copper. The mine could be worth as much as $28 billion.

Mine development, which is expected to require a capital investment of between $750 million and $1 billion over a two-year period, could mean about 2,000 jobs, and 600 to 1,000 full-time jobs once it is operating over its expected 30 to 50 year lifespan.

"For every one job on site, there are two to four jobs off site," said Brian Mountford, director and chief operating officer of Northern Dynasty Mines.

The company is looking to answer several important questions, including how to connect the mine to Cook Inlet, how to supply power and what nearby community's port would be used.

Homer City Manager Walt Wrede, along with Homer Mayor Jack Cushing, made sure the company officials got a good look at Homer's dock, storage areas and infrastructure.

"They said they were really impressed with Homer and that there was a lot more here than they thought," Wrede said.

Popp said borough officials were eager to learn how Northern Dynasty saw aspects of its future relationship with the borough.

"We were interested to know their views on work force development and we have begun a preliminary dialogue on that issue," he said. "They view the Kenai Peninsula Borough as important in the role of supplying workers."

The Lake and Peninsula Borough will be the first beneficiary of Northern Dynasty's local-hire program, he said, but by virtue of its geographic position and its developed infrastructure, the Kenai Peninsula Borough also has a strong work force on which to build.

Jenkins said the trip included a guided tour of Cook Inlet Keeper's facilities and lab in Homer. The nonprofit environmental agency is dedicated to protection of the Cook Inlet watershed.

"We had a very cordial discussion. We briefed them on preliminary elements of project, and we had an excellent dialogue," Jenkins said. "I hope it sets the stage for reasonable and objective discussions about the project as it gets defined."

Keeper head Bob Shavelson said the Keeper's board of directors is taking a wait-and-see attitude with the mine developers.

"If you look at the history of hard rock mining in the United States, most of these projects are fraught with some fairly significant ecological impacts," he said. "It will be a real challenge for Northern Dynasty to meet the high quality standards that they have set out for themselves."

The company has said it is committed to developing the Pebble Gold-Copper Project "in a manner that conserves and protects the local environment."

Homer News staff writer Carey James contributed to this story.



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