Mining Successes in Alaska

Transcription

1 Mining Successes in Alaska July 21, 2010 JOGMEC Tokyo, Japan By Tom Irwin, Commissioner Alaska Department of Natural Resources Larry Hartig, Commissioner Alaska Department of Environmental Conservation Ed Fogels, Director Office of Project Management and Permitting, ADNR

2 Alaska Producing Mines Red Dog The foundation of a multi-billion U.S. dollar mineral industry! Fort Knox Usibelli Pogo Greens Creek Kensington

3 Greens Creek Owner-operator: Hecla Mining Volcanogenic massive sulfide (Kuroko) deposit containing economic amounts of silver, lead, zinc and gold. Underground mine with an average grade of grams/tonne silver. 3rd largest silver producer in North America. Ten years of reserves.

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6 Red Dog A joint venture between NANA Regional Corp. and Teck Resources Large shale-hosted Pb-Zn deposit. Surface and minerals owned by NANA Corp. The world s largest zinc reserve (110 million tonnes of ore). World s largest producer of zinc concentrate. 2.7 million tonnes of ore mined annually at an average grade of 22% zinc, 6% lead and grams/tonne silver. Mine employs 450 people (including contractors) 50+% of which are NANA shareholders. Stores concentrate for 8-9 months a year.

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9 Fort Knox Owner/operator: Kinross Gold Corporation Large intrusive-hosted gold deposit. Operating open-pit gold mine producing 9,350 11,620 kilograms annually. Average combined grade is 0.86 grams/tonne. The mine employs over 400 people and has an annual economic impact of $196 million on the community of Fairbanks.

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13 Pogo Owner/operator: Sumitomo Metal Mining Co., Ltd. Mesothermal Intrusive related, shear-hosted, gold-quartz vein system. Discovered through systematic exploration in Contains 102,000 kilograms of gold at grams/tonne. Construction started in 2004, commissioned 1st quarter of Construction cost est. - $347 million. Employment 238 people. Production rate: 2,200 tonnes/day. Mine life: 10 years. Annual production ~10,200 kilograms.

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15 Kensington Owner/operator: Coeur Alaska Mesothermal intrusive-hosted shear vein gold deposit. Reserves: 3.8 million 8.6 grams/tonne. Operating mine provides 250 full time workers and spend $13m annually on local purchases. Currently being commissioned. Construction cost - $190 million. Mining/milling rate - 1,000 tonnes/day.

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17 Usibelli Owner/operator: Usibelli Coal Mine, Inc. Alaska s only operating coal mine Produced 1.7 million tonnes in Currently looking at significant expansion at Jumbo Dome (Healy) and Wishbone Hill (Palmer).

18 Location of Developing Mines and Large Exploration Projects Rock Creek/ Big Hurrah Donlin Creek Pebble Nixon Fork Chuitna Livengood Wishbone Hill Niblack Bokan Mountain

19 Rock Creek/Big Hurrah Ownership: NovaGold Resources Employment: Sheeted quartz-vein system Production: 2,835 kilograms/year Commissioned in 2008, currently in temporary suspension Big Hurrah: satellite pit 48 km. east of Rock Creek

20 Donlin Creek A joint venture between Calista Regional Corporation, Barrick Gold, NovaGold Resources Orogenic gold-quartz-sulfide sheeted vein deposit. Refractory gold deposit requires pressure oxidation. 953,000 kilograms of gold at an average grade of 2.19 grams/tonne. 2nd largest gold resource in Alaska. Ongoing exploration and feasibility investigations.

21 Pebble A joint venture between Anglo American and Northern Dynasty Minerals LTD. Resources: Measured and Indicated: 887,300 kilograms gold billion kilograms copper Employment forecast: >1,000. Mining rate: K tonnes/day. Annual production: >34,000 kilograms gold (equivalent). Ongoing exploration, environmental studies, and feasibility investigations.

22 Chuitna Pacrim Coal A surface coal mining and export development located in the Beluga Coal Field, approximately 72 kilometers west of Anchorage. Ultra low sulfur, sub-bituminous coal resource, approximately 20 kilometers from the coast of Cook Inlet. 25-year mine life at approximately 12 million tonnes/year based on proven reserves in one (LMU-1) of three mining areas in 8,324 hectare coal lease area.

23 Wishbone Hill Usibelli Coal Mine, Inc. Wishbone Hill is a historic mining area located approximately 65 kilometers northeast of Anchorage. Surface mineable reserves at Wishbone are estimated at 12.7 million tonnes of clean bituminous coal. UCM has not yet initiated mining activity at the Wishbone Hill location.

24 Nixon Fork Mystery Creek Resources Located 51 kilometers northeast of McGrath. The project currently consists of two developed small ore bodies with currently defined resources of approximately 126,400 tonnes, containing 3,730 kilograms of gold. An additional 116,000 tonnes of existing mill tailings are reported to contain 856 kilograms of gold.

25 Livengood International Tower Hill Significant new exploration project 113 kilometers north of Fairbanks adjacent to the Dalton Highway. Ongoing exploration, environmental studies, and feasibility investigations. Low-sulfide gold deposit, hosted in clastic and meta-volcanic rocks. Partly oxidized. Indicated: 195,611 kilograms, ave. 1.07g/t Au. Inferred: 39,689 kilograms, ave g/t Au.

26 Niblack Committee Bay Gold & Heatherdale Resources High grade Au-Cu-Ag-Zn volcanogenic massive sulfide (Kuroko) deposit. 44 kilometers from Ketchikan, at tidewater. Indicated Resource: 2,588,000 tonnes grading 1.18% Cu, 2.33 g/t Au, g/t Ag and 2.19% Zn Inferred Resource: 1,712,000 tonnes grading 1.55% Cu, 2.08 g/t Au, g/t Ag, and 3.17% Zn Ongoing exploration, environmental studies, and feasibility investigations. Currently drilling from a 1,000m exploration adit.

27 Bokan Mountain Ucore Rare Metals Prior producing high grade uranium mine, 60 kilometers southwest of Ketchikan USGS estimated 4.9+ million kilograms U3O8 remaining in situ, as well as tantalum, niobium, and rare earth elements One of the largest combined heavy & light rare earth deposits in North America

28 Other Significant Mineral Properties Lik-Su Arctic MAN LWM Lucky Shot

29 Other Significant Mineral Properties Lucky Shot (Full Metal Minerals): historic gold mine near Willow. Recent discovery of additional high grade mineralization. MAN (Pure Nickel, Inc): Triassic ultramafic-mafic intrusive complexes 100 km south of Delta Junction host Ni-Cu-PGE mineralization. Lik-Su (Zazu Metals/Teck): Significant Pb-Zn-Ag deposit 22 km northwest of Red Dog.

30 Other Significant Mineral Properties LWM (Full Metal Minerals) Ag-Zn-Pb-Cu deposit 100 km north of Tok. Previous drill results from LWM included 44.6 meters averaging 15.9% Zn, 5.3% Pb and 76.6 g/t Ag, 15.6 meters averaging 21.2% Zn, 8.7% Pb, and g/t Ag, and 6.48 meters averaging g/t Ag, 31.6% Zn, 11.3% Pb and 1.41% Cu Arctic (Novagold Resources): 300 km east of Kotzebue, contains 17 million tonnes grading 4% copper, 6% zinc, 0.8 g/t gold and 60 g/t silver, and an additional 12 million tonnes of inferred resources.

31 State of Alaska Programs and Actions to Advance Mine Development Airborne Geophysics Alaska Industrial Development & Export Authority (AIDEA) Stable regulatory and taxation structure

32 State of Alaska Programs and Actions to Advance Mine Development Airborne Geophysical/Geological Mineral Inventory (DGGS) A multi-year project to expand the knowledge base of Alaska s mineral resources as a catalyst to private sector investment. Products include: 1:63,360-scale aeromagnetic and airborne-electromagnetic maps 1:63,360-scale bedrock and surficial geologic maps 1:63,360-Scale Land status map and various geological, geochemical and geophysical data compilations

33 Inventory of DGGS Alaska Airborne Geophysical/Geological Surveys

34 DGGS offers both: Regional airborne magnetic and resistivity data (USGS & DGGS, 1970s or older data) and Detailed airborne magnetic and resistivity data (DGGS 1994-? And BLM-DGGS 1997-?)

35 Alaska Industrial Development & Export Authority (AIDEA) The mission of the Alaska Industrial Development and Export Authority (AIDEA) is to provide various means of financing to promote economic growth and diversification in Alaska.

36 Alaska Industrial Development & Export Authority (AIDEA) Support for Alaska mining projects: Road and Port for Red Dog Mine Skagway Ore Terminal Seward Coal Terminal Revenue Bonds for Fort Knox Tailing Facility Revenue Bonds for Kensington Dock and Tailing Facility

37 State of Alaska Programs and Actions to Advance Mine Development Regulatory Structure - Large Mine Permit Process Land Available for Mining Federal mineral lands State of Alaska lands Private lands, Aboriginal land claims settled available for mining Stable Taxation Structure with Development Incentives

38 State of Alaska Programs and Actions to Advance Mine Development Taxation and Incentives MINING TAXATION State corporate income tax. Net income based on graduated scale to maximum of 9.4% on income over $90,000 USD. Mining license tax. Based on net income from mineral product sales. Graduated tax, maximum of 7% on products sales over $100,00 USD. Production royalty. 3% on net income from sales on state lands only. Modest state claim rents and lease fees. Claim rental up to $520 USD/year for 65 Hectare claim. Production lease, up to $1.35 USD/hectare. Annual labor of $100 USD/16 hectare claim.

39 State of Alaska Programs and Actions to Advance Mine Development Taxation and Incentives INCENTIVES No state reserves tax. New mines receive a 3½ year grace period from paying mining license tax. Credit is given for rents and lease payments against production royalty. Exploration incentives program. Exploration expenditure credits up to $20 million USD per mining property may be booked. These credits must be used during the first 15 years of production and applied against corporate income tax, mining license tax, and products royalty.

40 Domo Arigato!