Mine industry prepares for new 'battles'

After year of record production, miners go on defensive against conservationists

Posted: Monday, March 26, 2007

Following a year of record mineral production levels, Alaska miners are preparing for what many of them see as an attack on the industry by an expanding conservation community.

Industry leaders such as Roger Burggraf, the environment and safety administrator for the Silverado gold mine near Fairbanks, voiced their concerns Friday during the Alaska Miners Association conference at Centennial Hall.

"We know we've been facing some real battles over the years, and it is really scary," Burggraf said. "We are not playing on a level field. We are getting really dumped on. How is the industry going to survive and be able to create a good public image?"

In a presentation titled, "The attack on the mining industry. Are we the next timber?" featured speakers described the various challenges natural resource industries face from increasingly tech-savvy, well-funded environmental groups and foundations.

Tim Wigley, vice president of Pac/West Communications and a campaign organizer, said the threat of global warming will be used to garner support against natural resource industries in Alaska - such as mining - and support in favor of increased restrictions.

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"There is a threat of one or more measures for the 2008 election cycle regarding taxation, (use of) cyanide. We don't know what they are going to be. I would advise you to prepare for any and all measures," Wigley said.

Legislation is now being considered at the Capitol to put a tax on the industry's royalties. Another measure has been proposed to create a fish refuge in Bristol Bay, which could severely impact the future of the nearby proposed Pebble Mine project. The state's permitting process for mines is also being questioned, most recently with a statement by an appeals court declaring an Army Corps of Engineers permit for a tailing facility at the Juneau area Kensington Mine to be a violation of the Clean Water Act.

Bradley Fluetsch, a financial consultant in Juneau, warned about the volumes of money spent by environmental groups and foundations nationwide.

"It's a highly sophisticated network. It is a well-funded network," Fluetsch said, calling it a rhizome, a botanical term for creeping roots.

What miners said

Alaska Miners Association 2006 Spring Conference

On environmental groups' opposition to the industry:

"How do we deal with these huge foundations that are funneling in money to destroy our livelihoods?"

- Roger C. Burggraf, environment and safety administrator for the Silverado gold mine near Fairbanks

On Mining Taxes:

"We'll never compare to the magnitude of oil and gas, but we pay our fair share with respect to other industries."

- Karl Hanneman, Council of Alaska Producers

On why legislators don't mind miners who come to visit:

"We don't come in crying and moaning and asking for money."

- Steve Borell, executive director of the Alaska Miners Association

On defending the industry:

"You never ever enter into a bar and get into a fight and win it without throwing a punch. You have to be willing to fight, throw a punch when necessary,"

- Tim Wigley, vice president of Pac/West Communications

On the campaign to stop the Pebble Mine near Bristol Bay:

"So unfair that I think it is un-American and un-Alaskan."

- Former House Speaker Gail Phillips

Foundations such as the Pew Charitable Trusts or the Wilbur Foundation pump billions into fighting industry development, he said, making mining's expenditures look like David facing Goliath.

Wigley agreed.

"They dwarf what we spend," he said. "They are not messing around."

Rob Cadmus, mining and water quality expert at Southeast Alaska Conservation Council, said this argument has been used before, but it is untrue.

"The CEO of Coeur Alaska, he makes 160 percent of SEACC's entire budget," Cadmus said. Coeur Alaska owns the Kensington Mine and is the target of the ongoing lawsuit by SEACC and other environmental groups over the mining company's proposal of using an alpine lake as a tailings facility.

"These mining corporations, they are all multinational corporations. Several people have tried to make those arguments in the past, but we run on comparatively shoestring budgets," Cadmus said.

Though the mining industry is becoming more defensive, it has experienced tremendous growth.

A study released last week by the Department of Natural Resources reported a 76 percent growth in the industry between 2005 and 2006 for an all-time high value of $3.26 billion. The number combines exploration and development expenditures with production values. Production value nearly doubled between 2005 an 2006 from $1.4 billion to almost $2.8 billion, which the study attributed to both strong metal prices and steady mineral production.

The industry needs get organized and to spend more, Wigley said.

"I know that industry doesn't like spending money on advocacy. (Campaigns), they cost a lot of money, and you don't always see direct tangential benefits," Wigley said.

Larry Hartig, the newly appointed commissioner of the state's Department of Environmental Conservation, said the mining industry should be more pro-active about involving the local communities in the entire process.

"You are not going to get public acceptance of (a project) if it doesn't meet the public values," he said. Hartig said he felt at home with the association because he worked for several years as a private industry attorney permitting projects in Alaska and helping companies comply with environmental laws. He encouraged mining companies to earn the public trust by exceeding the legally required minimums for public involvement.

"Every major resource project in Alaska is controversial. That is the bottom line. I can think of maybe one or two that didn't get appealed. Get ahead of the curve a little bit," he said.

Cadmus said he was surprised with how partisan many of the mining association's members and speakers were Friday.

"It was us versus them. They were very trying to single out the conservation community when the truth is that the people who care about clean water are just your average, every day folks," Cadmus said.

The Muskegger

Visit Brittany Retherford's blog in which she delves a bit deeper into Southeast's natural resources.

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"There are a couple of ways you can deal with conflict. One could be to work to find solutions that meet everyone's needs, the other is to personally attack the opponents," he said.

Michael Satre, an event organizer and a geologist at the Greens Creek Mine on Admiralty Island, said there is room for the environmental groups in the discussion.

"We should bring those folks to the table. We should probably do a better job of getting them on the agenda. Maybe it is not a debate. Maybe it is coming together and moving forward," Satre said.

"But sometimes it can frighten us, frighten us as miners," he said.

• Brittany Retherford can be reached at brittany.retherford@juneauempire.com.

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