Chamber facilitates AIDEA Lutak Dock financing discussion
April 29, 2021
The Alaska Industrial Development and Export Authority (AIDEA) last week proposed financing and developing Lutak Dock reconstruction to include an ore dock, a project that, according to AIDEA would diversify the local economy by supporting job growth and the “mining industry with a local mine on Alaska soil.”
AIDEA presented its proposal to the Port and Harbor Advisory Committee meeting after a borough town hall meeting on the subject was canceled in February because of limited staff time, said interim manager Alekka Fullerton.
The Haines Borough Assembly has expressed interest in partnering with AIDEA earlier this year to renovate Lutak Dock, which is at risk of failure and closed last year after Alaska Marine Lines completed construction of a new freight ramp, ensuring Haines’ supply chain will remain intact.
“There’s an opportunity to modernize and expand the existing Lutak Dock in combination with the potential bulk export ore-loading facility that would improve the dock’s overall commercial function,” said AIDEA’s senior manager for project finance Jesse Peterson.
AIDEA is a public corporation that provides various means of financing for development projects, many to do with mining infrastructure, throughout Alaska. It owns Skagway’s ore facility, which services Yukon mines, but its lease there expires in March 2023.
Sediments around Skagway’s ore terminal are considered contaminated by the Alaska Department of Environmental Conservation due to high levels of lead and other toxins. AIDEA purchased the facility in 1990 and enclosed the ship loader and installed an air- handling unit to filter particulates. It recently commissioned a study to determine the cost of modernizing the facility versus decommissioning it.
At a meeting earlier this year, AIDEA board members discussed letting the lease expire and searching for a new location for an ore facility if the necessary modernization of the facility proves too costly, or if Skagway is opposed to having an ore facility.
Japanese smelting company DOWA Metals is currently financing the majority of the Palmer Project, a copper and zinc deposit 40 miles north of Haines. Constantine Metals, a Canadian exploration company that held majority interest until this year, is conducting exploration to better understand the mineral deposit. At last week’s meeting, Constantine Metals president Garfield McVeigh said an ore terminal in Haines would make a potential mine cheaper to operate.
“In the absence of Skagway, Haines would be a more obvious place to ultimately ship concentrate from. In fact, it would facilitate the concentrate movement for us significantly if the facilities were in Haines versus Skagway,” McVeigh said.
During public comment, Lynn Canal Conservation director Jessica Plachta said Alaska residents should not use public funds to subsidize a project that would make Haines “an industrial haul-out for Yukon mines” or a potential local mine.
“The now Japanese-owned Palmer Project is dependent on using our tax dollars to subsidize the infrastructure they need and that’s why AIDEA is talking to you today,” Plachta said.
AIDEA executive director Alan Weitzner told the board that any project it gets involved in needs community support. “I do want to underscore that it’s working in concert with the community in each one of these elements where we’ve done an investment,” he said.
Weitzner’s statement came after committee chair Terry Pardee proposed an amendment which passed 4-2 to eliminate public comment at the beginning of the meeting.
“Anything anyone hears that they don’t like, you’ll have ample opportunity to vent your spleen at the end of the meeting or in the future as things go forward,” Pardee said.
Board member Will Prisciandaro voted against the amendment. “You’re taking away the public’s opportunity to talk,” he told Pardee. Public meetings typically have public comment periods at the beginning and end of the agenda.
“No, I’m not. No, I’m not. No, I’m not,” Pardee said. “I’m doing this in the interest of time and allowing these people to get the information out. What you do with it is up to you, but you’re not going to take over this meeting. People are going to be allowed to speak and I told you when.”
Project proponents, including Haines Chamber of Commerce executive director Tracy Harmon, Southeast Conference executive director Robert Venables, the Alaska Miners Association president and Constantine’s McVeigh all spoke in general support of such an AIDEA-funded project following the presentation.
Harmon touted numerous benefits mining would have on the economy, but stressed that an ore terminal would have wider benefits.
“This is about a resource facility that could be a major transportation hub for timber, wood chips, heavy equipment (and) pipeline,” Harmon said. “It can service several industries besides mining.”
“Over 54 percent of residents support mining in the Chilkat Valley,” she added, citing a Haines Economic Development Corporation telephone survey of 205 residents conducted in 2018. Mining received the lowest percentage of support among 10 the industries listed.
AIDEA’s Peterson said next steps would include developing a memorandum of understanding with the Haines Borough, receiving support from the borough assembly, and providing opportunity for public comment in the project’s development phase.