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Providing coverage of Alaska and Northwest Canada's mineral industry
April 2006

Vol. 11, No. 17 Week of April 23, 2006

MINING NEWS: Corps reaffirms support for Kensington project

Return of permits for tailings disposal, port allow construction to proceed as planned; environmentalists push ahead with lawsuit

Sarah Hurst

For Mining News

The U.S. Army Corps of Engineers has reinstated two permits for the Kensington gold project that the agency suspended last November following the filing of a lawsuit by the Southeast Alaska Conservation Council and other environmental groups. The permits authorize the discharge of fill material and the construction of a dock by Goldbelt in waters 25 miles north of Juneau. Specifically, mine tailings will be disposed of in Lower Slate Lake, which is the main point of contention in the lawsuit.

“The decision to reinstate the permits is consistent with our regulatory mission of ensuring that important aquatic resources are protected, while allowing for reasonable development,” said the Corps’ Alaska District commander, Col. Timothy Gallagher.

Alaska Gov. Frank Murkowski applauded the decision, saying, “This is welcome news for employees currently working at the site, who were facing potential layoffs. The Corps action reaffirms the sound science that has gone into the environmental planning for the Kensington mine.”

The commissioner of the Department of Natural Resources, Michael Menge, said that the permit reinstatement was “evidence that our system of responsible mineral development is working.” Idaho-based Coeur d’Alene Mines, the owner of the Kensington project, promised to move forward with full-scale construction of the mine. “We look forward to seeing this project fulfill its promise of generating significant economic value for investors, employees, and the economy of Southeast Alaska,” said Dennis Wheeler, Coeur’s CEO. “We believe we are in a position to begin producing gold at Kensington during 2007.”

SEACC will press lawsuit

Kensington’s troubles aren’t over yet, as SEACC will now press ahead with its lawsuit. “This permit takes us backwards 30 years to the days when corporations dumped their waste into public lakes legally,” said Kat Hall, SEACC’s mining and water quality organizer. “The Corps of Engineers is not stepping up to its responsibility to protect our clean water.” The environmentalists believe the use of Lower Slate Lake as a tailings dump will set a national precedent for future mines. They argue that the 404 permit from the Corps violates the Clean Water Act.

The Corps agrees with Coeur that the company’s plan is environmentally sound. “At the end of mine life and after reclamation, which is anticipated to be in 14 years, the lake will triple in size and aquatic life will be restored,” Col. Gallagher said. During the review process the Corps clarified the reasons for its decision to issue the permits, but did not make any major changes to the permits. The Coeur permit contains 47 special conditions to ensure that environmental impacts are minimized, and the Goldbelt permit contains 25 special conditions.

Factors that the Corps considered included conservation, economics, aesthetics, general environmental concerns, wetlands, cultural values, fish and wildlife values, flood hazards, flood plain values, land use, navigation, shore erosion and accretion, recreation, water supply and conservation, water quality, energy needs, safety, mineral needs, consideration of property ownership, “and in general, the needs and welfare of the people,” according to the new Record of Decision released in March.

No cyanide or arsenic will be used

No cyanide or arsenic will be added to Kensington’s ore as a reagent to recover gold, the Corps pointed out. The water in the tailings impoundment will not be directly discharged into any receiving water. All water from the impoundment will have to go to and through a water treatment plant during operation, and the discharge from the water treatment plant is subject to an NPDES permit.

The Cascade Point docking facility, to be built by Juneau Native corporation Goldbelt, was initially evaluated by the Corps as a separate project from the mine itself. The new Record of Decision analyzes Cascade Point as a component of the Kensington gold project. The Corps determined that without Kensington mine, the Cascade Point facility would not be constructed in the foreseeable future, even though Goldbelt hopes that it will also be used for purposes other than transporting workers to and from the mine.

The current Kensington plan of operations is significantly different from the one that was first approved by the U.S. Forest Service and the Corps of Engineers in 1997, which envisaged a dry stack tailings facility and a man camp for workers instead of a new port within daily commuting distance. Environmentalist often prefer dry stack tailings facilities, as at Pogo gold mine near Fairbanks, but in Kensington’s case the Corps asserts that the Lower Slate Lake plan will have much less impact on the area.

Acreage loss reduced

The dry stack tailings facility that was approved by the Corps would have impacted 268.1 acres of wetlands, and after reclamation there would have been a total net loss of 164 acres of waters of the United States. In the Lower Slate Lake tailings plan, 98.6 acres of waters will be affected, with a total net loss of just 3.44 acres of waters of the United States after reclamation. The dry stack tailings plan would have required the mechanical land clearing of 259 acres of wetland, as well as two stream crossings and two major creek diversions.

If a commuting dock is not constructed and operated for Kensington, employees must be transported to a camp either by helicopter or by boat from existing port facilities, the Record of Decision says. Traveling by boat from existing port facilities exposes the trip to risk of unavailability due to weather. Employees would either wait or attempt to travel by helicopter, exposing them to further safety risks in bad weather. A camp also requires the storage and transportation of much larger amounts of fuel. “The risks of unavailability and safety concerns make a personnel camp not practicable from a logistics standpoint,” the Corps said. Another key point in the Record of Decision was that the dry stack tailings facility and man camp make the Kensington project uneconomical for Coeur.






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