Discussions of water quality issues past, present and future highlighted Wednesday’s meeting of the AJ Mine Advisory Committee, held in the Assembly Chambers at City Hall.
Gold Creek — the basin of which contains the AJ Mine — produces two-thirds of the city’s drinking water, said Rorie Watt, the city’s director of engineering. Salmon Creek provides the remainder, he said, but there are times during the year where its water quality makes it unusable for consumer use. Additionally, water from Salmon Creek is designed to feed areas north of it, and currently cannot be rerouted to areas like Douglas and downtown if Gold Creek’s water becomes undrinkable for any reason.
“The Gold Creek water supply is critical to the city’s water systems,” Watt said.
Committee member Laurie Ferguson Craig said water quality in Gold Creek became a problem when the mine was being operated in the past, prompting an FBI investigation.
Those concerns were echoed by Skip Gray, who identified himself as the past president of Alaskans for Juneau, who used his public comment time to read into the record documents from what he said was a joint FBI/EPA investigation into the water quality issues from the AJ Mine.
Gray also objected to Frank Bergstrom’s membership on the committee, citing his prior employment by Echo Bay, the company that previously operated the mine, as a conflict of interest.
However, committee member Kurt Fredrickson pointed out that there were no criminal findings of guilt against Echo Bay or its employees as a result of that investigation.
A representative from Alaska Electric Light & Power discussed how the AJ Mine might be powered if it was reopened.
The utility currently has no surplus power to sell to a potential customer like the mine, said Scott Willis, vice-president of power generation for AEL&P, since all the extra energy generated by the company’s hydroelectric generation is committed to other customers, such as Greens Creek Mine and cruise ships.
Willis presented possibilities as to how to provide for the mine’s electrical needs. One option would be for the mine to create its own power using diesel generators, which Willis estimated would cost $.35 per kilowatt hour at current diesel prices. Other options included the mine using natural gas to power its own diesel generators, which he said Echo Bay had planned to do before abandoning the project, or for AEL&P and the mine to partner to bring the second phase of the Lake Dorothy hydroelectric project online. Willis did not provide specifics of how such a partnership might work, but did say the cost of launching Lake Dorothy’s second phase might be less than the first phase’s approximately $70 million cost, after inflation is considered.
Committee chairwoman Donna Pierce announced the formation of a subcommittee to look at economic issues surrounding the mine, including the feasibility of its reopening. The mine could produce $100 million of gold a year, based on previous estimates of available gold at today’s gold prices. Gold contracts for April closed at $1,411.40 per ounce Wednesday, according to information from CME Group, the owner of the New York Mercantile Exchange.
That announcement prompted Deborah Craig, during her public comment time, to ask the committee to consider creating an environmental subcommittee
The next committee meeting is scheduled for 5:30 p.m. March 10 at the Assembly Chambers.
The committee — officially tasked with determining under what, if any circumstances the city should consider reopening AJ Mine — is supposed to report its findings to the City Assembly by May 1.
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