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Bokan Mountain mining plans discussed at Capitol

Rare earth elements are the target for new enterprise

Posted: February 12, 2013 - 5:30pm  |  Updated: February 13, 2013 - 12:03am
Ken Collison, President of Collison Minecon and Chief Operating Officer for Ucore Rare Metals, right, talks with Rep. Eric Feige, R-Chickaloon, before his presentation to the House Resources Committee at the Capitol on Tuesday.  Michael Penn / Juneau Empire
Michael Penn / Juneau Empire
Ken Collison, President of Collison Minecon and Chief Operating Officer for Ucore Rare Metals, right, talks with Rep. Eric Feige, R-Chickaloon, before his presentation to the House Resources Committee at the Capitol on Tuesday.

A planned mine on Prince of Wales Island was the subject of this Tuesday’s “Lunch and Learn,” a lunchtime meeting hosted by the House Resources Committee featuring presentations from industry representatives and others on topics of interest to committee legislators.

Ken Collison, chief operating officer for Nova Scotia-based Ucore Rare Metals Inc., talked about his company’s plans to mine for rare earth metals at Bokan Mountain on Prince of Wales Island, along the shores of Kendrick Bay and a short distance from a derelict uranium mine.

“The thing that separates Bokan from the others is the amount of heavy rare earths,” said Collison. “Mountain Pass mine — it’s in California — has basically all light rare earths. They’ve got 1 percent heavy rare earths. Bokan has 40 percent. And so that’s really what separates us from the others.”

According to Collison, heavy rare earth oxides — especially dysprosium oxide, europium oxide and terbium oxide — are rarer and more valuable than light rare earth oxides, like cerium oxide and lanthanum oxide.

Rare earth oxides have a range of applications, including use in electronics, military-grade weapons and electric motors.

Collison said the Bokan Dotson Ridge mining project is expected to produce 95 tons of dysprosium per year, nearly half of the 200 tons consumed in the United States last year.

Projections also suggest it will meet a smaller, but still significant, share of the nation’s demand for terbium, yttrium and neodymium, ranging between about 10 percent and 35 percent, according to Collison.

Right now, Bokan Dotson Ridge is in the permitting process. A contract for a pilot plant, which will test out the solid phase extraction mining technique Ucore plans to use in the mine, is expected to be awarded later this year, Collison said, and construction on the mine itself could begin next year, once the project is permitted.

Collison stressed that Bokan Dotson Ridge will make an effort to reduce its environmental footprint. Instead of mine tailings being left on the surface, they will be mixed with cement and used as backfill underground, he said.

Collison also said the mine will be looking to hire locally. He said he has met with officials from the University of Alaska Southeast, as well as with the Ketchikan Indian Community and others, about bringing in Alaskans to work at the mine.

“If you hire a person from Craig and start paying them $85,000 a year, they’re not going to quit,” Collison said. He explained that having little turnover in the workforce means less time will be spent on training, making for a more efficient operation.

“It’s also good for the community,” Collison added.

According to Collison’s numbers, the mine would employ 190 people, will cost $221 million in preproduction capital and would produce 2,250 tons of rare earth oxides. The project cost would be recovered in 2.3 years.

Collison also said he thinks Bokan Dotson Ridge could exceed its projected 11-year lifespan.

“There’s no reason to believe it’s not going to be longer,” said Collison. “It’s easy to expand the mine, it’s hard to get it started. So the first thing we’ve got to do is get it permitted and built.”

Rep. Dan Saddler, R-Eagle River, co-chairman of the House Resources Committee, asked Collison after the presentation about other potential rare earth element deposits in Alaska.

“I know we have some here in Bokan Mountain,” Saddler said. “Are there other locations in Alaska?”

Collison said there are, naming the Ray Mountains in central Alaska, where Ucore has land claims, as an example.

“There’s a lot of rare earth prospects in the state,” said Collison. But he said many rare earth prospects in Canada and elsewhere may go undeveloped because of their low heavy rare earth content.

Collison even suggested that if rare earth mining in Alaska takes off, a manufacturing industry using the rare earth oxides mined in the state could spring up.

“I think there’s a real opportunity for the state to take rare earth oxides and keeping going up the food chain,” Collison said. “There’s no reason why we can’t be the only people in the United States producing rare earth metals for magnets and maybe rare earth motors and generators. … It would develop a new industry for the state, and to me, that’s really exciting.”

• Contact reporter Mark D. Miller at 586-1821 or at mark.d.miller@juneauempire.com.

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