I must respond to Shoren Brown's Dec. 8 "My Turn" column about sustainable mining, Coeur d'Alene Mines Corp. and the Kensington Mine project located 45 miles north of Juneau.
Mr. Brown has decided that Coeur d'Alene Mines Corp.'s (Coeur Alaska's) effort to permit and develop the Kensington Mine north of Juneau is being done in the way mining companies conducted business 50 years ago, without environmental laws and regulations. The facts are that Coeur operates according to a host of federal and state environmental laws and responsible corporate environmental policies - policies its CEO and board of directors insist are followed. And, as a result, since 1987, Coeur has been the recipient of 19 national and international environmental awards. Mr. Brown apparently is unaware that probably the most prestigious were made by the Sierra Club, Mineral Policy Center, Wildlife Habitat Council, and U.S. Forest Service. Coeur's environmental credentials are impeccable.
Coeur recently completed an optimization study for the Kensington Gold Project designed to reduce capital and operating costs, without compromising its environmental policy. Coeur is now diligently trying to get the project permitted in the manner the study calls for. The new proposal significantly reduces land disturbance, and eliminates the need for a 250-person mancamp by a daily commute and rotation designed to promote 225 high-paying, year-round jobs - jobs Juneau, Haines and other communities in Southeast Alaska need. Further, the mine site cannot be seen from Berners Bay, will be reclaimed to the highest standard without ongoing environmental risk, and will support an improved fishery at closure.
Coeur must show, in advance of receiving all necessary permit approvals, that the proposal will not violate the federal Clean Water Act and, using sound science, that the new proposal is the "least environmentally damaging, practical alternative." This is the purpose of the environmental impact statement. The EIS will be required, regardless of land ownership. Coeur's investment of $140 million includes $21 million in scientific studies on tailings management alone. These studies show that the proposal to locate the surface operation of the mine west of Berners Bay and deposit tailings in Slate Lake is better than the proposal calling for a 130-acre area of dry tailings stacked in a pile near Lynn Canal.
Coeur does not cut corners at its other mining operations either. Coeur acquired Callahan Mining Corp.'s project located in the Silver Valley of Idaho in 1991. Over 1 billion ounces of silver were produced in the valley since 1890. Coeur chose as a sound business practice to settle former environmental damages by these historic activities with the Coeur d'Alene Tribe, Environmental Protection Agency, and U.S. departments of Agriculture and Interior. Coeur's current Silver Valley operation is in full compliance with all environmental regulations.
Coeur acquired the Golden Cross New Zealand Mine in 1992. Three years later, a large landslide was discovered. The company commenced a risk analysis to determine if the slide could be dewatered, or if the project should be closed. Coeur spent millions of dollars stabilizing the slide. Not willing to continue operations with potential environmental risk, it closed and reclaimed the mine site, then sued the previous seller for securities fraud for failure to disclose land movement had occurred. Coeur's claim against the seller was settled for approximately $31.5 million. The payment by Coeur's insurance carrier to the shareholders had nothing to do with environmental allegations. New Zealand regulators give Coeur the highest environmental marks. The project's former mine site now supports grazing, tree farming, environmental education facilities, and soon a commercial bottled water business. This is sustainable mining.
Coeur has been diligently reducing its outstanding debt, and significantly improving its financial standing. In 2002, it restructured 45 percent of its debt by converting it into stock ownership, a certain indication there is confidence in the direction and operation of the company by the financial markets. Coeur will produce a record 14.5 million ounces of silver this year, and generate a positive cash flow for its shareholders.
Mr. Brown has his facts correct on one point. Alaska (and Juneau) needs jobs, an issue Gov. Frank Murkowski pushed to the forefront in his successful campaign. What better way to achieve this than sustainable mining and resource development in a community lagging far behind the rest of the United States in long-term per capita income growth. The project represents an annual payroll opportunity of more than $16 million.
Coeur, over the past 14 years, has remained committed to Kensington and those jobs and involving Alaskans in the project. It has entered into agreements with local Native groups to consider privatization opportunities and it has hired local, spent local and contributed local.
"Environmental feasibility" will be the driver for Coeur. It will be done right. This is the way Coeur does business, bringing sustainable mining to Southeast Alaska.
Rick Richins is a senior environmental officer at Coeur and has managed the environmental program at Kensington since 1987.