Alaska is rich in mineral potential but poor in the critical infrastructure needed to fully realize this potential: that was the message Alaska Division of Geological and Geological Surveys Director Steve Masterman delivered to lawmakers on Capitol Hill.
During a March 30 hearing, Masterman told member of the U.S. Senate Committee on Energy and Natural Resources that Alaska could be the answer to the United States’ growing dependence on foreign suppliers for minerals.
“One significant national contribution Alaska’s mineral resources could provide is supply security,” he told the committee.
Masterman’s testimony came in a hearing convened by Sen. Lisa Murkowski, R-Alaska, chair of the energy and natural resources committee.
“We come from a state where we have a great deal of resource to offer but more often than not our opportunity is limited because our infrastructure is limited,” Murkowski said.
Making the case for improving access to Alaska’s vast resource potential comes at a time when the Trump administration is preparing to present a massive infrastructure bill for Congressional approval.
"To launch our national rebuilding, I will be asking the Congress to approve legislation that produces a $1 trillion investment in the infrastructure of the United States - financed through both public and private capital - creating millions of new jobs," President Donald Trump told lawmakers during his Feb. 28 address to Congress.
Storehouse of mineral wealth
Masterman made the case that Alaska has the potential to be a domestic source of most of the minerals vital to the wellbeing of the United States, including those needed to rebuild the nation’s infrastructure.
In its 2017 minerals report, U.S. Geological Survey said the United States is 100 percent import-reliant on 20 different minerals and depends on foreign sources for more than half its supply of another 31.
The DGGS director and head geologist for Alaska told the committee that the 49th State has deposits and prospects containing all of the minerals for which the U.S. is 100 percent import-reliant and about half of the ones the nation is 50 percent dependent.
Among the growing list of minerals for which the U.S. is fully import-reliant are critical and strategic minerals such as rare earth elements, manganese and niobium; and important technology minerals such as graphite and yttrium.
Of the remaining 31 minerals that the U.S. relies on foreign countries for more than 50 percent of its supply, Alaska is a potential source of titanium, germanium, antimony, tin cobalt and chromium, to name a few.
“At a time when domestic infrastructure investment is a national priority, the United States is becoming even more dependent on foreign supplies of minerals rather than producing domestic supplies,” Masterman testified.
“Alaska’s storehouse of mineral wealth could be key to reversing this trend,” he added.
Large state, few roads
The DGGS director indicated that investing a healthy portion of Trump’s planned US$1 trillion of infrastructure spending in Alaska would help the nation realize the potential of Alaska’s minerals wealth.
“Without a federal partnership for resource infrastructure, Alaskan supplies and Alaskan projects will be at a disadvantage in the international marketplace, and the national trend of increasing reliance on imports of minerals and metals may continue,” he said.
Making the point that Alaska is overdue for a major infrastructure program, Masterman pointed out the disparity between the state’s massive size and nominal road system.
“While the state has 17 percent of the nation’s land mass and is by far the largest state, we have 0.4 percent of the nation’s total lane-miles of road,” he explained. “The limited road system has real impacts on the cost of transportation of goods to communities throughout the state, and presents real challenges to the exploration and development of mineral resources.”
Large road projects
Roads to Nome and Ambler would begin to rectify the infrastructure disparity and help the U.S. realize the mineral potential of its largest state.
Masterman said finishing a 500-mile road linking Nome on the Seward Peninsula to the state’s contiguous road system would be beneficial to both the residents of this western region Alaska and companies seeking to explore and develop mineral projects in this otherwise remote area.
In 2016, Alaska completed the first leg of this road by extending the westernmost reaches of Alaska’s road system 20 more miles to Tanana.
“Continuing this road effort west to the Seward Peninsula would expand these demonstrated economic benefits to a larger area; provide a transportation link to a broad geographic region that is currently constrained by remote access, and improve access to mineral-rich areas along the route,” Masterman explained.
The Ambler Mining District Industrial Access Road, a proposed 211-mile transportation corridor that would link the metals-rich Ambler Mining District with Alaska’s road system, is another infrastructure project the DGGS director brought to the committee’s attention.
A partnership between Trilogy Metals Inc., a mineral exploration company, and NANA, an Alaska Native Regional Corporation that represents the Inupiaq people of Northwest Alaska, is exploring the minerals-rich region at the end of the proposed Ambler Road.
Arctic, the most advanced project being explored by Trilogy and NANA, hosts some 1.65 billion pounds of copper, 2.62 billion lb of zinc, 444 million lb of lead, 610,000 ounces of gold and 45.3 million oz of silver in the inferred and indicated resource categories. This deposit will likely be the first mine in the Ambler District.
Bornite, a deposit being advanced by the partners about 16 miles south of Arctic, hosts another roughly 6.4 billion lb of copper, plus significant amounts of cobalt.
Mining infrastructure needs
In addition to large road projects, Masterman said there are a number of advance staged mining projects across the state that would get a boost from infrastructure support.
Donlin Gold, the largest and most advanced of these projects, is also the most remote.
In the final stages of permitting, the Donlin Gold Mine is expected to produce an average of 1.1 million ounces of gold annually over an initial 27-year mine life.
If developed, a mine of this magnitude would provide an enormous boost to the Yukon-Kuskokwim region of Southwest Alaska.
Donlin Gold LLC - equally owned by subsidiaries of Novagold Resources Inc. and Barrick Gold Corp. - anticipates an annual payroll of US$375 million to pay the roughly 3,000 workers during the three- to four-year construction phase. Once in production, the company expects about 800 workers making roughly US$100 million per year.
The region is also expected to benefit from a 312-mile long, 14-inch diameter pipeline that will deliver natural gas to the mine.
“As an example of the local cost-of-living benefits, this pipeline will also serve as a new energy source for the surrounding villages, reducing their power costs,” Masterman said.
The DGGS director also told lawmakers about the Graphite Creek deposit approximately 50 miles north of Nome.
A major ingredient in lithium ion batteries, graphite is a mineral which the U.S. is 100 percent reliant on foreign sources.
Graphite Creek, however, is the largest known deposit of graphite in North America and among the largest in the world.
Graphite One Resources Inc., the company advancing the project, is currently assessing the feasibility of developing a mine at Graphite Creek and a separate manufacturing facility that would produce high-grade coated spherical graphite primarily for lithium-ion electric vehicle batteries.
Masterman said both the mine and processing facility would benefit from infrastructure and financial support.
The Dotson Ridge deposit at Ucore’s Bokan Mountain project in Southeast Alaska is an advanced stage project that could provide the U.S. with a domestic supply of heavy rare earth elements, including dysprosium, europium, terbium and yttrium.
The U.S. Department of Energy named these four heavy rare earths among the five most critical and supply-risky materials in the country.
These same REEs are critical ingredients to much of the high-tech U.S. military hardware, making a secure supply of these metals an issue of national importance.
Masterman also listed Palmer and Niblack, two Southeast Alaska deposits rich in copper, zinc, gold and silver, as two other advanced mineral exploration projects that could provide jobs and bolster the economies where they are located.
National interests
Closing out his testimony, Masterman made a strong argument that investing heavily in Alaska infrastructure is vital to the security and economic well-being of the U.S. and hits on Trump Administration priorities.
“The national interests in infrastructure development in Alaska are significant - increasing domestic supply security of our mineral portfolio, increasing our competitiveness, strengthening America’s position in the Arctic, boosting our economies, and potentially reducing the nation’s trade imbalance,” he argued. “With solid federal support, we look forward to fulfilling Alaska’s role as a storehouse for our nation’s resource wealth - and the jobs and cost-of-living benefits utilizing these resources will bring.”
