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Separate forums highlight risks and benefits of mining in Haines


March 12, 2020 | View PDF

How to minimize risks while maximizing the benefits of mining were themes at two mining forums held last week in Haines. It’s the second year in a row that Haines has hosted two mining information events in the same week—a Thursday evening discussion sponsored by the Southeast Alaska Conservation Council and Lynn Canal Conservation, and the two-day Chilkat Valley Mining Forum, which spanned last weekend.

At Thursday’s event, Southeast Alaska Conservation Council’s staff scientist Guy Archibald talked about the risks involved in mining, with a particular focus on water contamination. He also discussed the power dynamics that exist between a mine and the community where the mine is located and the ways communities can work to have greater input in the mining development process.

The weekend forum, organized by the Chilkat Valley Mining Forum Committee, featured nine speakers from either mining or community planning backgrounds: Meilani Schijvens, socio-economic specialist from Rain Coast Data; Rorie Watt, city manager of Juneau; Garfield MacVeigh, Constantine president and CEO; Jim Casey, geological engineer from Klohn Crippen Berger Consulting, hired to do tailings disposal planning for Constantine; Shena Shaw, socio-community specialist from Hemmera Consulting, a company Constantine hired to run community engagement activities; Scott Bradford, retired Haines water and sewer operator; Dave Long, owner of Haines Real Estate; Mike Bell, former director of the University of Alaska Southeast Mine Training Center and Liz Cornejo, Constantine vice president and member of the Chilkat Valley Mining Forum Committee.

In-person attendance at the weekend forum was down from last year, Cornejo said, although the event was live streamed on the internet. According to organizers, 50 people attended Saturday and 30 on Sunday. 

“Even though numbers were down, we were pleased with the diversity and knowledge in the room,” Cornejo said. “The questions (at these events) are becoming more relevant,” allowing for a higher level of discussion, she said.

Last week’s forums were the first held since the release of the Palmer Project’s preliminary economic assessment (PEA) last summer, which allowed discussions to focus more specifically on the potential impacts of mining in Haines.

The following are specific issues raised at the two forums:

Economic Impacts

A significant portion of the Chilkat Valley Mining Forum focused on the economic benefits of mines and infrastructure considerations. Constantine vice president and mining forum member Liz Cornejo said mines drive direct and indirect spending including payments for land use, employee wages and sales tax to municipalities.

According to the Alaska Miners Association’s 2019 report compiled by the McDowell Group, mines in Alaska directly employed 4,500 people and provided a total of 9,200 direct and indirect jobs in 2018. In that year, mines provided $34 million in revenue for local governments and $149 million for state government.

Rorie Watt, Juneau city manager, said that although the City and Borough of Juneau does not notice the Kensington and Greens Creek mines due to their remote locations, the economic effects are large. “The property tax income of the mine is quite significant,” contributing 8% of the city’s property tax and 4% of the overall municipal budget, Watt said.

Cornejo asked Watt what Juneau is doing to prepare for eventual mine closures. “We have not done any post-closure planning,” Watt said. “If they (were to) close (Kensington or Greens Creek) it would be a hit to the economy, but maybe not a huge hit due to the diversity of (the Juneau) economy.”

Greg Erikson, in a forum last year, said mine closures would be more likely to hurt rural communities like Haines because small towns don’t tend to have as diverse economies.

 “Every mine is like a small town,” former director of the University of Alaska Southeast Mine Training Center Mike Bell said, speaking about job opportunities. Mines require staff with a diverse set of skills, offering employment opportunities in areas including wastewater collection, road maintenance, carpentry, utilities, snow removal, medicine and more, he said.

An influx of workers has the potential to drive expansion in the housing market, said realtor Dave Long.

According to the Haines Economic Baseline Report (2018), there are 1,623 housing units in Haines. Long said he estimates Haines will need at least 100 additional housing units if a mine begins operating. 

The borough needs to start thinking ahead about how they want to control that growth, Long said, listing considerations including potential building codes, infrastructure improvements, zoning laws and the creation of new subdivisions. He said the location of new housing should be a big consideration.

The townsite has room for additional homes, and the added benefit of being closer to existing utilities, Long said. Other locations for potential expansion include 33 Mile and 27 Mile Haines Highway, and Haines might need to further develop power infrastructure if development out the highway increases, he said.

Forum attendee Erika Merklin, who is on the Board of Friends of Mosquito Lake, said development out the highway could also increase demand for other services like a school.

While an influx of roughly 300 mine employees, a number projected by Constantine’s PEA, would increase demand for services and infrastructure needs, the mine could also be a source of revenue for supporting borough services and funding capital projects, said Scott Bradford, a 30-year borough employee. 

Bradford listed borough infrastructure projects in need of funding. At the top of his project list was the renovation of the Lutak Dock, which the borough has estimated will cost $24 million. A public-private partnership with the mine would be one way to help support the dock-repair, he said.

The borough has several options for financing capital projects with bigger price tags including tax increases, cuts to services and looking to outside sources for revenue, Bradford said. He said his preference would be increasing revenue from outside sources like the mine. “My concern is it won’t be fast enough.”

The community needs to think about the kinds of economic benefits that have the potential to serve Haines after the mine is gone like the creation of jobs with transferable skills or a public-private partnership to pay for capital projects the borough can’t afford on its own, Long said. “What do you want to have after it’s all done?”

Haines resident Gershon Cohen, who attended the Lynn Canal Conservation forum, said it’s often difficult to compare the economic benefits of a mine to the risks associated with mining since it can be challenging to assign monetary value to a healthy environment or what it means to a culture.

Derek Poinsette, executive director of Takshanuk Watershed Council who attended both forums, said he would have liked to have seen more discussion about the negative economic impacts of mining in areas like fishing and public health. “The big question that we want to answer is, ‘what are the negative impacts to other industries?’… It’s unfortunate to have a discussion that only talks about the benefits, especially when we have a strong economy right now.”

Tailings and Mine Waste Disposal

Tailings disposal was discussed in separate presentations by Guy Archibald on Thursday evening and Jim Casey on Saturday. Archibald, an environmental chemist for more than 20 years who has worked on uranium and oil shale projects in the Lower 48, discussed risks to water quality. Casey, geological engineer from Klohn Crippen Berger (KCB) Consulting, discussed how the firm addresses and plans for these risks.

Klohn Crippen Berger Ltd. is a global engineering and geoscience consulting firm with 550 employees. Jim Casey specializes in designs that address mine waste management and dam safety.

Constantine contracted with KCB for a conceptual design to support the Palmer PEA. Casey’s team spent 700 hours understanding the specifics of the Palmer Project site and designing for mine waste and water management. “We want to design something that’s going to stand up to the environment, that’s not going to (negatively impact) the communities downstream.”

Casey said the concept his team designed is different than the high-profile Mount Polley dam failure and recent tailings dam failures in Brazil, where tailings are stored as a slurry. In a separate interview, Casey said although a slurry tailings storage facility is generally cheaper per ton to operate than a filtered tailings facility, there are other aspects to consider beyond processing cost in deciding on the best tailings management strategy, such as potential risks, opportunities and other costs. Casey said his team avoided the slurry tailings storage design concept mainly due to the terrain at the Palmer site and other project-specific benefits from filtered tailings.

The tailings processing concept identified by Constantine would involve separating the tailings into two types: potentially acid-generating “pyrite” tailings and non-acid-generating “desulfide” tailings. All of the pyrite tailings and a portion of the desulfide tailings would be mixed with cement and pumped underground for disposal. Remaining non-acid-generating desulfide tailings would be filtered, a process in which most of the water is “squeezed” out of the tailings. The tailings would be stored above ground in a filtered tailings pile, commonly referred to as the “dry-stack” method. The tailings pile would be reinforced by structural berms and underlain by a liner. Water run-off from the tailings pile would be stored in a pond that would undergo water quality checks.

Archibald summed up his concerns by saying, “Constantine can try everything they can in their power to do things right… but the history shows that it is probably going to go wrong.” Both mining and the ecosystems they impact are incredibly complex, he said, making it difficult to accurately predict what will happen 10, 50 or even 100 years in the future.

Archibald said failures to contain mining waste occur for a number of reasons including lack of corporate prioritization, the absence of strict regulations and the normalization of a larger number of failures. “If I had to summarize the last 2,000 years of mining history in a single sentence is would be, ‘Oops, I didn’t see that happening,’” Archibald said.

Derek Poinsette, executive director of Takshanuk Watershed Council, attended both Archibald’s and Casey’s talks. “The fact that this mine is at the headwaters of one of the largest salmon-producing watersheds on the west coast puts it in a special category,” he said. “None of the other mines, Greens Creek, Kensington, the mines in Fairbanks, those mines aren’t at the head of a large salmon stream. The risks are greater for this mine, so the standards and the discussion should be different.”

“There are very few hard rock mines, if any, that have not had problems,” Poinsette said. “I would like to see (the discussion) just own up about that at events like this rather than pretend that this is going to be the magical mine that doesn’t have any of these issues.”

Ed Coffland, a registered professional engineer in the state of Alaska, said he thinks “(the preliminary design) is really solid. If I thought there was a chance of damaging the river I would be against the mine, but the chance is so remote.”

In a separate interview, Cornejo said “the PEA is a conceptual plan for tailings management and storage. We need to continue our research and analysis, and we think we can work with experts to develop design proposals to address concerns.”

Community engagement

Although “community engagement” with a mine might mean different things to different people, speakers at both the Thursday and weekend mining forums agreed that it was important.

Hemmera Consulting socio-community specialist Shena Shaw presented takeaways from a series of interviews Hemmera conducted with Haines residents at the end of last year to get a sense of the community’s concerns and hopes about the mine to inform Constantine’s project moving forward.

Hemmera reached out to more than 100 stakeholders in Haines including organizations and agencies involved in community planning, nonprofits and groups that had commented on previous permit applications, Shaw said. Of those that responded, some declined to participate. Hemmera ended up conducting 22 interviews with individuals either over the phone or in person, she said. 

The goal of the study was to figure out how to make a project more reflective of community values—identify potential negative outcomes and the best way to mitigate them, and the potential benefits and how to enhance them, Shaw said. She said interview responses matched up pretty well with both permit application comments and what Constantine had told her about community concerns. In general, the individuals Hemmera interviewed held a range of views about the mine, listing both attractive and unattractive aspects of the project. Concerns they expressed were not unique to Haines, Shaw said.

Water quality was a main concern raised during interviews, Shaw said. Other common concerns were the impact on infrastructure like roads and the Lutak Dock; increased demand for housing, schools and other services driven by increases in population; the potential for a boom and bust economy and the ability for economic benefits from the mine to outlast the life of the mine.

“Engagement is not a one-way communication,” Shaw said. The interviews Hemmera conducted are part of a larger process of community engagement that will include public meetings, open houses, focus groups, expert panels and written communication. Constantine is engaging very deeply with the community far earlier than a typical mine would, she said. In part, this is because early engagement is good and in part because the community has expressed some valid concerns, she said.

The key to holding an entity like a mine accountable is to ensure they have skin in the game, Archibald said at Thursday’s mining forum.

A minority group can have influence in a process if they’re vocal and say, “no,” Archibald said. Communities have the ability to ask mines to meet certain standards in exchange for community approval of a mine, he said.

Archibald brought up the concept of a “good neighbor agreement,” a legally binding contract between local, non-government organizations and a mining company that can hold mines to higher standards. Such agreements can establish clear and enforceable water quality standards and provide for citizen oversight of mining operations, he said. 

Reaching agreement could involve threatening to fight the mine in the court, Archibald said. Good neighbor agreements are difficult to achieve, he said. 

Archibald said the Red Dog Mine is touted as an example of successful negotiations between a community and a mine. The land the mine is on is under NANA’s control. After years of negotiations, NANA was able to get concessions from the mine including preferential hire and a 12.5% royalty tax. The agreement also includes a mechanism to work through environmental and subsistence issues brought about by mining activities, he said. However, this model would be difficult to transfer to Haines where Constantine’s land is under a variety of jurisdictions.

Derek Poinsette, executive director of Takshanuk Watershed Council, cited the Stillwater Mine in Montana as an example of a successful good neighbor agreement where the local community waived future rights to sue in exchange for the mine agreeing to meet protection standards beyond those required by state law.

Cornejo said while a good neighbor agreement is a possibility, there is only one example in the U.S. of an agreement of this type between a community and a mine, and this agreement came out of litigation. “I would hope we don’t get to that point,” she said. 

Cornejo said it is important to consider what underlying issues a good neighbor agreement would be trying to solve and said there could be multiple ways of addressing concerns including municipal code changes and working with a company to reach other types of agreements. She said increasing community engagement to allow Constantine to understand community concerns and work to address them is part of this process. 

Cornejo said Constantine understands that environmental protection is a priority for Haines along with issues like employment and educational opportunities. The mine’s preliminary economic assessment factors in efforts to mitigate the mine’s environmental impact through features like dry-stack tailings storage.

Executive director of Lynn Canal Conservation Jessica Plachta said that recent studies have shown mining companies, in general, care about having social license to operate in a community. She encouraged community members to let their concerns show.

Shaw said she had heard from individuals during the interview process who felt the process was designed to manufacture consent. “I’m not here to convince people of whether or not this project is good or bad. I’m here to try and create space for people to listen to different ideas, engage in that discussion respectfully and at the end of the day, the process is intended to change how this project might look so that it better reflects what the community wants.” Based on these discussions, people might decide the risks aren’t worth it or that the benefits outweigh the risks, Shaw said.

A community can’t protect against all the harms of mining, Archibald said. At the end of the day, allowing a mine to enter the community will come down to a risk-benefit analysis. But you won’t get the benefits without negotiating, he said. He said community members should think about what they stand to gain and what they stand to lose.

Constantine is the company conducting exploration, but it is likely that another company will operate the mine, Haines resident Gershon Cohen said. Ultimately, Haines will need to negotiate with the company that operates the mine.


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