Massive Copper-Gold Mine at Pebble, Alaska, Gains Momentum
Apr 04, 2004 (Alaska Journal of Commerce - Knight Ridder/Tribune Business News via COMTEX) -- A copper-gold mine developed at Pebble, 250 miles southwest of Anchorage, could be bigger than previously thought.
If the project is developed, Northern Dynasty Minerals Inc. now estimates that a large open-pit mine at Pebble could cost $1 billion to develop, employ 700 to 1,000 workers in production and 2,000 during two years of construction needed to build the mine.
In addition, the mine could require between 100 megawatts and 150 megawatts of power, according to Bruce Jenkins, Northern Dynasty's Director of Environment and Permitting for the project.
Construction of roads to the mine will also be required. A 65-mile road will be needed to connect the mine to a new port that would be built on Cook Inlet, most likely at Iniskin Bay.
Concentrates of copper and gold could be trucked to the port, although a slurry pipeline is also under consideration, Jenkins said.
Iliamna, 15 miles from the project, has an airport with two paved runways, one 5,080 feet in length and the other 4,800 feet in length.
"This isn't an exploration project anymore. We've made a strategic transition from exploration to mine planning and permitting," he said.
In a March 17 press release, Northern Dynasty announced it has commenced the collection of engineering and environmental data for completion of a Bankable Feasibility Study as well as submission of a federal Environmental Impact Statement.
"We've committed $15 million to $20 million this year on mine development work," Jenkins said. The money is coming from a $22 million private placement financing package Northern Dynasty completed March 17 to fund development work on the project.
Jenkins said the company has spent $8 million over the last two years on exploration at Pebble. "We have a high degree of confidence now, and we wouldn't be spending this much to do further development work unless we believed we have a mine," he said.
"We have sufficient drill data to confirm there is a mine. The question is how big it will be," Jenkins said.
It could be very big. Pebble is a large copper-gold deposit on the Alaska Peninsula 15 miles north of Lake Iliamna. Independent consulting firms have confirmed resource estimates of 26.5 million ounces of gold, 16.5 billion pounds of copper and 900 million pounds of molybdenum.
These resources make Pebble the largest gold deposit in North America and the second largest copper deposit, according to Norwest Corp., a consulting firm.
The resource base is sufficient to support 45 to 50 years of mining, Jenkins said.
Northern Dynasty's 2004 work program has three elements, he said. One is to do more drilling at the project site to add to the company's geologic database and get geotechnical information and data on characterization of waste rock, he said.
The field work will be helicopter supported, and unlike in past years when geologists made daily commutes to the site, the company will build an exploration-type tent camp this year, Jenkins said.
A second goal is to initiate engineering planning and mine design work, which would include a plan for an open-pit mine and a facility to store waste rock. Jenkins said Northern Dynasty has retained Knight Piesold Consulting, an international mineral engineering firm that has done work on Alaska projects.
A third initiative is to launch environmental baseline studies, which will continue for a number of years. The company is building a team of environmental consultants and contractors which will include firms with Alaska experience, Jenkins said.
Some of the environmental work is already underway, he said.
State officials confirmed they have met with the company to outline permit requirements for a mine at Pebble, which is located on state lands. Dick LeFebvre, Deputy Commissioner of the state Department of Natural Resources (DNR), said DNR's large mine permitting team met with the company. LeFebvre said he thinks the company will spend 18 to 24 months gathering environmental data before permits can be applied for.
Given its size and scope, Jenkins said the project will need a federal Environmental Impact Statement, a process which usually takes 18 to 24 months.
He said it will take three to four years to get permits for a mine, with an additional two years needed for construction.
Jenkins said Pebble is only one prospect in a large land area the company controls. There are at least two other potential large, unexplored ore bodies similar to Pebble, he said.
The U.S. Geological Survey has identified the area that includes Pebble as the world's largest sulfide mineralization system, according to information on the Northern Dynasty Web site.
By Tim Bradner
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(c) 2004, Alaska Journal of Commerce, Anchorage. Distributed by Knight Ridder/Tribune Business News.
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