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Vol. 17, No. 46 Week of November 11, 2012
Providing coverage of Alaska and Northwest Canada's mineral industry

Mining Explorers 2012: Alaska invests in minerals sector

Parnell administration undertakes five-part strategy to support industry

Daniel S. Sullivan

For Mining Explorers

The state of Alaska is a strong supporter of continued investment, responsible development and growth in our minerals industry.

We recognize the key role the state plays in its minerals sector. We have an enormous endowment of minerals such as gold, zinc, copper, lead, silver and coal on state lands and can support job creation and economic growth in entire regions of the state by responsibly developing our natural resources. We are working hard to make Alaska a place where miners want to explore, invest and do business.

Alaska’s mineral exploration and production continues to grow. In 2011 Alaska’s mining industry grew at a healthy rate: gross mineral production was valued at $3.8 billion in 2011, a 16 percent increase from 2010. This is significant to our overall economy: minerals accounted for more than a third of Alaska’s exports. Exploration expenditures were at US$300 million, a 14 percent increase from 2010. The spending on mineral exploration in Alaska accounts for roughly one-third of all exploration spending in the United States.

Strategic minerals initiative

In September 2011, at the State of Alaska’s first Strategic and Critical Minerals Summit, co-sponsored with the University of Alaska Fairbanks, Gov. Sean Parnell unveiled the state’s five-part Strategic Minerals Initiative. This initiative is designed to grow the Alaska economy and contribute to our national security through the assessment, development and processing of Alaska’s strategic and critical minerals, including rare-earth elements.

Our five-part strategy is focused on: Undertaking a statewide assessment of strategic minerals; providing incentives to develop known or highly-likely mineral occurrences; improving permitting to expedite responsible projects; strengthening partnerships and cooperation with other government entities, Alaska Native corporations and potential developers; attracting new investment and developing new markets for Alaska’s mineral resources.

Progress

One year out, we are making significant progress on many of these fronts. Regarding the statewide assessment, we worked with the Alaska Legislature this year to provide US$2.7 million to support the Alaska Division of Geological & Geophysical Surveys’ field work and analysis of data from strategic mineral occurrences around the state. This is in addition to the US$500,000 that the Legislature previously provided to launch the assessment in 2011. This is the largest state--funded strategic mineral assessment ongoing in the country.

This summer, DNR geologists fanned out across the state to work on the assessment, investigating strategic mineral occurrences ranging from Southeast Alaska to the Interior. They have published encouraging results from their fieldwork this year, such as gold and rare-earth element findings in the Melozitna mining district. An excellent summary of the division’s assessment work ran on July 29 in this publication, under the headline” Alaska geologists unearth rare earths.”

Regarding the second prong of our strategic mineral initiative, the state’s “Roads to Resources” program prioritizes the construction of roads needed to access our minerals and other commodities. The Roads to Resources program incentivizes the private sector to share in the cost of developing new roads and providing access to the state’s natural resources. This will make projects more economical to develop and it will provide increased access to rural communities, with public input as a critical component. Working with the Alaska Legislature, we allocated US$28.5 million for Roads to Resources projects across the state this year. Two of these projects will improve access to mineral deposits: construction of a road to Tanana, and work to develop a road to access significant mineral resources within the Ambler mining district.

The third prong of the state’s strategic minerals initiative is to improve our permitting. The Department of Natural Resources and other state agencies have launched an effort over the past year to make our permitting more timely, efficient and certain. At DNR, we were able to slash our backlog of permits and authorizations by more than one-third. We continue to work over a number of fronts – including technological innovation and reforms to our statutes and regulations – and we have hired additional staff to ensure that we are processing applications in a timely manner.

This work to improve our permitting system is critical not just for the minerals industry, but also for other industries and individual Alaskans who simply want to access our state lands.

More “big-think” ideas are coming. Last year, we visited eight regions of the state to collect important public input on how to improve our permitting system. We worked with the Legislature this year and were able to enact improvements to our statutes that will help to reduce costs and improve the timeliness of our decisions. We expect to propose additional changes to state regulations and statutes in the future

We are also focused on building partnerships. A good example is our collaborative efforts with the U.S. Geological Survey and Alaska Native corporations on our strategic minerals assessment. We are also getting ready to host our second Strategic and Critical Minerals Summit on November 30 in Fairbanks, where many stakeholders will have the opportunity to discuss their activities and ideas to foster strategic mineral development in Alaska.

Our upcoming strategic minerals summit is also a critical tool in our overall effort to promote Alaska’s mineral resources to the rest of North America and overseas markets. We are touting our vast resource base, our strategic mineral potential, our high environment standards, and interest in developing public-private partnerships to develop our infrastructure.

In the past year, state officials have traveled to large investor conferences in Canada and Asia to discuss the great opportunities that we have due to our natural resource endowment. Clearly, there is significant global interest in investing in our resources, and we are committed to doing this responsibly for the benefit of Alaskans.



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