The president and CEO of Coeur d’Alene Mines Corp., along with the general manager of Kensington Mine, brought news of a growing gold mine to Juneau Chamber of Commerce business roundtable at the Hangar on the Wharf ballroom on Thursday.
“Kensington is really all about consistent sustainable production,” General Manager Wayne Zigarlick said. “We’re trying to transition out of this phase of construction … and really try to de-risk the property so that all of our systems work and we’re able to be predictable and sustainable in the future. We’re on the cusp of that now,” he said. “Kensington is going to be something we can count on.”
The mine is wrapping up its construction phase with a handful of recent infrastructure projects.
It is finishing work on an underground paste plant. The plant mixes the ground-up waste rock with concrete to fill the voids created when an area is mined, Zigarlick said.
Kensington employs 260 mine workers directly, with another 100 contractors. Of Kensington’s employees, 70 percent are Alaskan and half are from Southeast.
Mine workers now have a place to catch some sleep in a new bunkhouse that sleeps up to 200.
“This has helped a lot with employee morale,” Zigarlick said.
Miners can commute daily if they like, Zigarlick said. However, the commute is two hours each way. Many prefer to work four days on and three days out or two weeks on followed by a week off. These bunkhouses, with kitchen and amenities, are second homes for these workers. An expanded warehouse and administrative offices are expected to be completed during the first half of 2012.
This infrastructure development is expected to lower gold production in the first half of 2012. Output is expected to rise again once the projects are complete in the second half of the year.
The mine plans to achieve production of 125,000 ounces of gold a year.
Zigarlick said the mine expects it can produce gold for approximately $800 or $900 an ounce once the mine starts focusing on efficiencies, Zigarlick said. Gold on the New York Mercantile Exchange closed at $1,672.90 an ounce Thursday.
Chamber members asked about Kensington’s future reserves.
Coeur d’Alene president and CEO Mitchell Krebs said the mine’s current life is expected to be 12.5 years to 13 years. Exploration and efficiencies could extend this life.
Kensington does not plan to explore outside its footprint. However, it plans to spend $4 million on exploration drilling in 2012.
“A lot of the drilling this year is to develop a firmer mine plan around what we already know,” Zigarlick said. “We do believe that Kensington has outstanding exploration potential, and we’ve had some good indication of that. Right now we are focusing on the next three to four to five years to make sure we have a sustainable resource and then we’ll focus on growing the resource.”
The mine does not plan to build its own smelter, Zigarlick said.
“Not a piece of the puzzle that Kensington would want to get into,” Zigarlick said.
Gold-bearing concentrate from the mine is shipped in large bags to Germany and China for smelting. The concentrate is made in a flotation mill.
Kensington wouldn’t be interested in smelting even with low-cost hydroelectric power, Krebs said.
Krebs did touch on energy costs, a major concern for the mine.
“Diesel is one of our biggest costs,” Krebs said. “If there was an alternative source of power, we’d use it. And we’d use a lot.”
Coin collectors might see a Kensington coin in the future. To the question of a coin, Krebs said, “it’s something we’d certainly consider.”
Kensington underground gold mine is located about 45 miles northwest of Juneau on the east side of the Lynn Canal.
The mine produced 88,420 ounces of gold in its first full year of operation. Metal sales from the mine totaled $151 million, or 15 percent of Coeur’s total sales in 2011. It reported an operating cash flow of $36.1 million.
Kensington’s proven reserves totaled 326,000 ounces of gold with more than 1 million ounces of gold in probable reserves at year-end, 2011. Measured and indicated resources of gold totaled 587,320 ounces. Inferred resources levels totaled 169,680 ounces of gold.
Coeur d’Alene Mines Corp. trades under the stock name CDE. The company’s stock price, down 4.6 percent over the year, rose 5.4 percent to $23.02 Thursday.
Next week the Juneau Chamber of Commerce is hosting Gov. Sean Parnell at its business roundtable at the Westmark Baranof Hotel on April 19.
• Contact reporter Russell Stigall at 523-2276 or at russell.stigall@juneauempire.com.
Comments (36)
Add commentLocal hires
So only a third of the mine employees come from Southeast?
The construction of the new bunkhouse will only make that worse, allowing transients to live at the mine then commute out of town during their week off.
Unless the article was
Unless the article was modified after your post, at the time of this post, it read 50% of the employees are from south east.
Actually
it could be taken either way, and it is an important difference.
"Of Kensington’s employees, 70 percent are Alaskan and half are from Southeast."
Either half of the 70% are from Southeast, or half of all employees. Which is it?
it is work
and high paying jobs dudes.....better than multiple seasonal tour shop employees that take all their money and run. Both mines hire as many locals as possible, too many cannot pass the drugs tests or are not willing to do the hard work involved in being a miner.
Ask some of the local contractors that have made a successful go of working at the mines, they employ all locals, most all of which are union employees.
Don't belittle the mining company(s) as if they were not here, Juneau would be in the dumps and so would your property values, services etc. that the companys help fund in large part.
greens creek
Was opened with a 20 year life expectancy, its been operating well past that mark. Go get it Kensington.
Littledude 85 always sees the dark cloud rather than its silver lining
Back when Greens Creek
Back when Greens Creek opened, there were a lot of local guys turned away because they couldn't pass the drug screens. The company went out of its way to hire locals. I was acquainted with several guys who just couldn't give up the spliff. I'm sure the same holds true now.
Don't even bother. Juneau
Don't even bother. Juneau supports development.
GE
Lost it's 750 million appeal for pollution of the Hudson river & has yet to start paying cleanup costs, wonder why Barry isn't holding Jeffrey's feet to the fire.
jumpstarted
You haven't been to a mine site like Greens Creek or you are just blinded to your environmentalist propaganda machine....they spend millions to do more than needed to protect the environment, the bears and deer flock to the worksite, it doesn't bother them, it shouldn't bother you either.
We should be continuing to harvest not only our mineral resources, but our renewable ones as well in "an environmentally sound way" (sound bite courtesy of SEACC)
Jumpstart
Are you really equating Greens Creek to the Coeur d'Alene River Basin?
mines
Y a I guess if your a miner or a mining co shareholder or a greedy landlord it is great, but as our city ignores the reality of the economic impact of mining we will lose our talented young people to more affordable states. In twelve years rent will go from the 600 to 1000 a room to even higher. Then the miners will leave after making billions and we will be lft with these high living costs. So thank you CBJ for your incompetent planning when you knew we would need more housing when the mine opened. Time to fire CBJ and sell their substantial land holdings so we can afford to live here instead of planning to fulfill every ones greed by raping the poor.
Comment
Stay off drugs...stay in school.
Perhaps
We ought to "Invest" in the new socially acceptable economy?
Here is how it works;
There are two basic types of employment:
1. Those who accept social services from the government.
2. Those who provide social services from the government.
What was left out?
Seems to be a whole lot of "Look how great we are" and a whole lot of nothing to those locals, both in Juneau and in the villages, who fought all the way to the Supreme court to make the mine happen, How about it CEO and others at Cour? Who really was the face that made the mine happen? Lets give a little credit where credit is due! I could think of a few names offhand.
lol AH HA
Nice regurgitation from Rush Limbaugh.
As for Kensington refusing many employees for failing drug tests, this just goes to show how unfair the war on marijuana is.
Just because someone tests positive for cannabis doesn't mean they are unfit to work. The buzz of THC wears off after a few hours. Maybe they should re-think this policy.
And if they are gonna ding people for drug addictions, they should start with smokers. Most weed smokers don't tweak at a staff meeting if they go two hours without a doob. The same can't be said of a cigarette smoker.
If I were in a mine, I'd rather be working next to a stoner who hasn't had his morning wake and bake instead of a cigarette smoker who starts to tweak after going two hours or longer without a fix.
@Jo
You know I dislike Rush Limbaugh just as much as I dislike Ed Shultz... But you have to admit there are a bunch of people in Juneau who are “against” anything else. They have never seen a mine or a road or a logger or a cruise ship or a housing development or a hydro plant in this region that they liked.
What’s left?
@Jo
I could very easily agree with you on the Cannabis thing except, there is no real way to test for current intoxication and knowing human nature, it's a sure bet someone will be stoned at work since there is no way for them to "get caught". And frankly, having experienced both jonesing for a tobacco fix and being stoned first hand, I would rather work next to the guy who wants a cigarette.
"Belittling Kensington"
Not hardly, Chaco. I was holding them to account. They made a local hire commitment, and they should be held to it. If they can't get enough qualified local applicants, fine. Prove it.
You all should be supporting that position, since you all are trumpeting the jobs that these mines bring.
@ Lat...
Huh? Did the sun come up in the west? Did we just agree on something? You are damn right they ought to have thier feet held to the fire over local hire. It was a big selling point to get public support for the mine that they are still touting today.
Ghee, it's unfair that
Ghee, it's unfair that marijuana is illegal. Bogus man! Well, it's not like it became illegal last week. Hey, it may be unfair, but that's the way it is. We can stand around and pis$ our pants about how unfair it is until the second coming of Che Guevara if we want, but it isn't going to do any good. The reality is that if somebody wants to work in the mines, he/she has to be drug-free. If one can't pass a whiz quiz, one can't work in the mines. It's not a big secret. If people aspire to work in the mines, they have to clean it up. Otherwise, be content to work at Walmart, or sit at home and suck on a celery stalk.
When Greens Creek opened, one of the big wigs told a member of my family that he understood that a lot of the miners smoked weed. However, his reasoning was that he didn't want to hire people that didn't even have the self-control to stop smoking long enough to pass the pee test.
bored stiff
Sounds like the folks posting need to get outside and get fresh air.Just think what J-hole would be like without the mines.
Think about it...
Everything we use is either grown or mined.
jomac
Here's a clue lifes not fair. Now go forth and multiply. Err in second thought.... Just go, forget about the multiply thingy
"It it isn't grown, it must be mined"
More regurgitation. I see that on uber-right wing bumper stickers.
Cows are not mined, nor are they grown like a crop.
So, that regurgitation above is meaningless.
Air is not grown nor mined. And I use that a lot.
You see, you right wingers who regurgitate things like that really show that you have no original thoughts. If it sounds pretty, it must be true to you. If it comes from the mouth of a Fox News Blond, it must be true.
I am not against mining, I am against irresponsible mining and mining corporations who promise one thing and deliver another. I am for holding mining companies accountable to their promises like Latitude is. If Kensington promised x% local hire, they better deliver it. And if they were a good corporate neighbor like Greens Creek (and their HUGE $2000 checks) they would surpass that percentage and hire ALL local if possible.
They would also contribute more to local things. I don't see Kensington's name out there a lot like I do Greens Creeks. This means either they have lousy PR people (doubtful) or else they just don't want to give back to the community like good corporations do.
So far, Kensington has yet to prove to me that, aside from jobs, they are good for Juneau.
@JO
To tell the whole truth.... those bumper stickers you refer to actually say "IF it isn’t grown it must be mined"
Just as a curiosity, What do you give back to the community?
@ AH HA
Dearest AH HA, I am so involved in this community that if I were to list all the volunteer things I am involved with, you would cry.
Suffice it to say, I offer my volunteerism for several causes every single week of the year.
I also give money to causes I believe in. I am a socialist. When we all do better, we all do better.
@Jo
Dear someone else. I don't believe you and frankly I doubt if you ever gave a dime or any time. Prove up.
nice try.
You're funny. I don't have to prove anything to you.
Get it right please!
The correct statement is “ If it can’t be CAUGHT, and it can’t be GROWN, it must be MINED!”
@Jo
Either you have no causes that you believe in or, you are scared admit them.