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Mining comes with risks, and rewards

Posted: March 16, 2012 - 12:13am
Karen Matthias shows an example of a finished product from mined metal during her Lunch and Learn Presentation titled "Mining Works for Alaska" at the Capitol on Thursday.  Michael Penn/Juneau Empire
Michael Penn/Juneau Empire
Karen Matthias shows an example of a finished product from mined metal during her Lunch and Learn Presentation titled "Mining Works for Alaska" at the Capitol on Thursday.

Most of the benefits of mining are well known: jobs, money and the refined metals U.S. industry needs. Many of the drawbacks are also known: physical danger, financial risk and environmental degradation.

What isn’t usually discussed is how mining can affect a community beyond its economic impacts.

During her noon presentation titled “Mining Works for Alaska: International Investment = Local Benefit,” Karen Matthias described the tangible and intangible effects of mining in Alaska.

“Red Dog [Mine] is more than just a mine developing essential minerals: it is a mechanism for hope and catalyst for the northwest Alaska and statewide economy,” according to NANA Regional Corp.’s website. Matthias referenced NANA’s statement and talked about the mentor role that well-paid mine workers serve. The financial benefit of mining in rural communities even has an affect on domestic violence and other social ills, Matthias said.

The lunch-and-learn was held at the Capitol on Thursday. Matthias runs Karen Matthias Consulting. The report was commissioned by the Council of Alaska Producers.

Matthias said three-fifths of the hydroelectric power in Juneau comes from power plants developed by mines over the previous 100 years, a testament to the longevity of hydro power.

But there are the tangibles. Matthias showed a slide prepared by the Pebble Limited Partnership showing all the ways copper and molybdenum, two common minerals found in Alaska, are used in snow machines and fishing boats. The point was to bring home the importance of metals in everyday life. And there is the $500 million the six largest mines spent in Alaska last year.

Mining provided 4,500 jobs in 2011, 71 percent Alaskan. The average annual metal mining wage in the state was $100,000, according to Mattias.

“By any standard in this country, that is a very good wage,” Matthias said. “Alaskans earning a good family supporting wage all over the state.”

Juneau’s municipal coffers benefited to the tune of $2.6 million from Kensington and Greens Creek property taxes in 2011. The state of Alaska received an estimated $148 million in royalties, rents, fees and taxes. Two-thirds of Greens Creek employees are Alaskans. And 3 out of 5 of Juneau’s hydroelectric facilities were built by mines in the last 100 years.

One hundred twenty communities in Alaska house miners, half of which live in rural Alaska, Matthias said. She also said mines spent approximately $1.3 billion in Alaska last year. Potential mines Niblack and Pebble could employ over 200 and 800 operation jobs respectively.

And the risks?

Mining jobs come with a fatal risk. Thirty-nine U.S. miners died from coal and hard rock mining in 2011. In the same time period, 44 journalists died on the job, five in the United States, according to the Committee to Protect Journalists. Two Alaska miners died on the job in 2011, which ranked it as tied for the fourth-most deadly state for miners in the union.

After 30 years and $2.8 billion worth of exploration, Alaska is home to six large producing mines. There is a lot of risk involved in mining, Matthias said.

Explorers risk millions, developers risk tens of millions and volatile commodity prices can delay repayment of a project by years. Greens Creek took 14 years to develop and Kensington discovered its modern deposit 27 years ago.

Mining comes with a “high financial risk,” Matthias said.

The rewards of mining are potentially great.

The advance of renewable energy resources is dependent on minerals, Matthias said. Five tons of copper is used in a 3 megawatt wind turbine, she said. Much of the modern magic in high technology relies on the properties of a class of minerals with the misnomer rare earth elements. Rare earth elements are found copiously throughout the earth’s crust, but are found in concentration in only a few places — the isotopes are similar and difficult to separate. Bokan Mountain on Prince of Wales Island is a potential source and Molycorp Mineral’s Mountain Pass Mine. Molycorp has recently restarted production at Mountain Pass in response to the 97 percent market dominance of China.

• Contact reporter Russell Stigall at 523-2276 or at russell.stigall@juneauempire.com.

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alaskaguy
553
Points
alaskaguy 03/16/12 - 08:51 am
3
4

Only risks?

Not to belittle the dangerous job of underground mining, but there are other risks, risks to habitat, human health, subsistence and recreation economies, sustainability for future generations obviously (obliviously?) avoided here. Not to mention the continued investment in extraction of natural resources rather in education and innovation.

wmolson
4366
Points
wmolson 03/16/12 - 08:59 am
5
2

I wonder

I see she showed a slide "Prepared by the Pebble Limited Partnership" about the importance of metals. But I wonder if she showed an artist's illustration, or photo of their proposed mine?? From what I understand they plan to excavate an area 4-5 miles long and 3-4 miles wide, and 4,000 feet deep. Even a photo of large open pit mines presently in operation or now abandoned or superfund clean up sites would have been informative and helpful.

al97ct
465
Points
al97ct 03/16/12 - 10:36 am
2
3

How much of these precious

How much of these precious minerals are allowed to go into our dumps?
And how much effort goes into collecting and recycling for these minerals?
And what about the needs of our future generations?
These mines are more about wealth creation for CEO's and shareholders than anything.

Recycling and small mines are the answer not these big mines.

Even though some people can make a decent wage mining, it does not give this industry the right to degrade or pollute our environment or put other peoples livelihood’s at risk.

al97ct
465
Points
al97ct 03/16/12 - 10:29 am
2
3

Lets see some figures on

Lets see some figures on recycling precious minerals.
Can we meet our needs this way?

I think it is high time to limit entry of mining in our state, just like with our fisheries.
How much is left? This is a non-renewable resource

"These Corporations come into our state and stake a claim and because of how the old 1800+ year old mining laws reads they own our minerals out right. They pay a small Royalty on the minerals and pollute our state to high heaven".

catandmouse
657
Points
catandmouse 03/16/12 - 12:17 pm
0
2

"The financial benefit of

"The financial benefit of mining in rural communities even has an affect on domestic violence and other social ills, Matthias said".

hummmm..... yes it does have an affect:

Alaska ranks No. 1 in the country for domestic violence and also forToxic Release and I think we could say, in rural communities. The Red Dog mine is a lead mine.....

Lead, at certain exposure levels, is a poisonous substance to animals as well as for human beings. It damages the nervous system and causes brain disorders

These extraction industries have a history of exploiting indigenous populations and polluting the environment all around the world. Now they are here.

MC Trig
-1
Points
MC Trig 03/16/12 - 11:39 am
0
1

That 100k average wage...

...is too high! Lock em up and throw away the key!

catandmouse
657
Points
catandmouse 03/16/12 - 12:15 pm
1
1

"Juneau’s municipal coffers

"Juneau’s municipal coffers benefited to the tune of $2.6 million from Kensington and Greens Creek property taxes in 2011."

How much was taken out our coffers when Sean Parnell moved 300+ state jobs out of Juneau? Certainly much more than $2.6 million

...and these jobs were all above ground.

kpawsuh
10138
Points
kpawsuh 03/16/12 - 12:09 pm
1
0

Wasnt necessarily a good

Wasnt necessarily a good picture to put on the screen. Snow machines are viewed as pure evil here in Juneau...

J. E. Fume
5000
Points
J. E. Fume 03/18/12 - 08:51 pm
0
0

Mining seemed to be good last

Mining seemed to be good last year for the Dakota Boys up outside of Haines. It also seemed good for the boys off the beaches in Nome.

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