Mining activity soars in Alaska

Posted: Wednesday, January 30, 2008

Mine companies are scrambling to extract while mineral prices are still high - and Alaskans are collecting ever rising taxes.

Exploration in Alaska by mining companies rose to $275 million in 2007, an increase of 54 percent from the year before, according to a new report paid for by a mining industry group.

Alaska mineral exports in 2006 were valued at $1.1 billion, or 27 percent of the state's exports.

The Alaska Miners Association hired the McDowell Group, a Juneau- and Anchorage-based for-profit research group, to report on the economic impacts of mining. The report uses data from local and state government, and from the companies themselves.

"It's been a real blessing for the Southeast region," said Randy Wanamaker, spokesman for the Berners Bay Consortium, which supplies workers to the Kensington and Greens Creek mines.

Ninety percent of the workers at the Kensington gold mine, about 45 miles northwest of Juneau, are Southeast Alaska residents, according to Coeur Alaska, which is working to open the mine.

That number was just half the work force one year ago. Also, more than half of the construction workers were affiliated with Native corporations, the report said.

The local hire is partly a result of an agreement between Coeur and the Berners Bay Consortium, which includes Goldbelt Inc., Klukwan Inc., Sealaska Corp. and Kake Tribal Corp. Coeur said it is aiming to have at least 13.5 percent of its Kensington work force "Native-affiliated," which means the worker would be a Native corporation shareholder, a shareholder's family member or a corporation employee.

"They've gone far beyond that goal, " Wanamaker said.

The Kensington and Greens Creek mines account for 670 Southeast jobs in 2007, the report said.

Statewide, mining jobs numbered about 3,500 last year, with a payroll total of $340 million. The average mining job paid $80,000, which is 90 percent higher than the state average for all parts of the economy.

Coeur Alaska paid $100,000 in property taxes to the city. After production begins, Coeur will be the largest taxpayer in Juneau. Right now that distinction goes to the Greens Creek Mine, owned by Kennecott Minerals and Hecla Mining Co., which paid $1 million in property taxes in 2007.

Greens Creek, on Admiralty Island, has been producing silver, zinc, gold and lead from 1989 to 1993, and then since 1996. The Kensington mine is expected to begin production in 2008.

• Contact reporter Kate Golden at 523-2276 or e-mail

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