My turn: Coeur has done nothing right in mine development

Posted: Monday, February 23, 2009

It is simply mind-boggling that Rick Richins could possibly think Coeur has managed the Kensington gold mine project correctly. The fact is Coeur has essentially done everything wrong and nothing right in the development of the Kensington mine.

It is hard to figure that a mine that has been in the planning, design and construction phase since 1988, when Richins first came to Juneau to work on the project, has been doing everything so right when the mine remains idle due to a failure to secure permits for an environmentally responsible tailings disposal plan.

If Coeur has done everything so right, why is there no production coming out of the mine today? It is because Coeur has managed the project irresponsibly.

The company has not acted in the best interests of Alaskans, the environment or even Coeur's shareholders. The price of Coeur's stock has fallen from a high of nearly $28 in May of 1990 to a low of 36 cents in 2008. During Richins' tenure in Juneau, the value of Coeur's stock has plummeted 98 percent. What this shows is that Coeur has not only mismanaged the development of the Kensington mine, but has mismanaged its entire business. While sitting on a literal gold mine, Coeur has driven their stock price down 98 percent.

On Nov. 10, 2008, Coeur received notice from the New York Stock Exchange that because of its low share price, Coeur was in violation of NYSE rules and is in danger of being delisted from the NYSE. It is simply unrealistic for management to think that they are managing the company correctly when stock prices have fallen 98 percent and they are about to be delisted from the NYSE.

During this same time period, the price of gold has tripled from about $300 per ounce to $1,000 per ounce. Silver also tripled in value.

If Couer had any concern for the citizens of Southeast Alaska, the environment, the potential mine workers, the economy of Juneau or their shareholders, it would have pursued the environmentally preferred dry stack tailings disposal plan that already was approved. Had they pursued the dry stack tailings plan, mining at Kensington would have been underway for nearly a decade, and the contributions to the Alaska and Juneau economy would have been realized.

Coeur had a very simple choice to make: either adopt a more expensive dry stack tailings plan, or fight the citizens of the United States and challenge the Clean Water Act. Couer chose to fight the Clean Water Act and attempt to reverse three decades of the environmental improvement that the Clean Water Act has secured for Americans.

More recently, Coeur abandoned a paste tailings disposal plan that had approval from conservation groups in favor of fighting the Clean Water Act in the U.S. Supreme Court. In the end, Coeur will have to adopt either the dry stack or the paste tailings plan. It is unlikely that the Supreme Court will allow not only Coeur, but all mining companies to dump toxic pollution into U.S. waters.

It is in the best interest of all Alaskans that any mining in the state be performed with the least possible pollution of our valuable water and fisheries resources. Kensington can operate and be highly profitable with either of the environmentally sound tailings disposal plans that the conservation organizations have recommended.

The facts are clear, Mr. Richins. Coeur has not done it right.

• Fred Einspruch is a resident of Haines and a member of the Sierra Club, SEACC and Lynn Canal Conservation.

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