After
hearing a story on KDLG 670AM about UAF-BBC getting like $25K and
Dillingham School District receiving a little over $100K from The
Pebble Limited Partnership via The Alaska Community Fund for some
high speed technical upgrade for the classrooms, I decided to
“re-survey” the status of several mining exploration projects in
the headwaters of Bristol Bay. Of course the venture of most
notoriety is the proposed Pebble project. But, there are several
other projects that are under exploration that have for some reason
avoided the eye of the Alaskan media. So, lets get on with this. . .
Just
last month, an Alaska court imposed a settlement upon the
participants in a case involving several Bristol Bay tribal entities
suing the State of Alaska over land-use designations. In 2005, the
Alaska Department of Natural Resources illegally re-wrote the 1984
Bristol Bay Area Plan (BBAP) with assistance from several mining
industry veterans, reclassifying several million acres from “Wildlife
Habitat” to “Mineral Extraction”. The settlement stated that
the State of Alaska would have to “go back to the drawing board”
and re-write the (BBAP). This effectively reclassified almost all of
Bristol Bay as a mining district, setting us up to be invaded by a
multitude of foreign corporations. It is not yet clear how the
settlement in the 2005BBAP lawsuit will affect the dozen or so
exploration projects already underway in the Bristol Bay region.
Of
course any discussion on mining in the Bay starts with the current
big dog on the block, Pebble. This project is slated for permitting
to begin sometime in the Spring of 2013, unless they delay it once
again. They did have success this year in helping defeat Alaska
Ballot Measure 2, which means that there is literally no local voice
in the actual management of Federal projects in the watershed zones
of Alaska. The Pebble Project also succeeded in lobbying the entire
Alaskan D.C. Delegation into undermining the US Environmental
Protection Agencies DRAFT Bristol Bay Watershed Assessment, along
with a few Alaskan elected officials as well.
However...
that project may be in limbo as Anglo-American Plc. is facing
internal issues following the abrupt resignation of Cynthia Carroll
as CEO. Carroll's departure follows months of labor unrest in
several Anglo-American African mines. Workers in AmPlats mines across
Southern Africa began going on strike to protest hazardous working
conditions and low pay. These strikes were broken by typical strong
hand tactics that led to the deaths of several dozen workers at the
hands of both private security and public police. The workers
recently went back to work after Anglo-American threatened to dismiss
permanently all the strikers. The strikes did lead to a production
decline in that division of Anglo-American, but not enough to have a
real lasting effect on the company's position.
Their
instability is based on their rather large development and production
commitments that have begun to drag out beyond their expectations.
The metals industry as a whole has experienced a slight hiccup as the
“rebuilding” of China has also slowed. The Brazilian Mega-Mining
conglomerate Vale' has also seen a slow down in Chinese and Asian
steel imports. Vale' credits this to the increased demand but low
attainability of energy to run the required manufacturing sector for
the rising Chinese demand of “luxury” consumer items.
For
thirty years the Chinese manufacturing focus has been on rip-off
inexpensive versions of American products, not on what the Chinese
people would want. Because of course, they only were allowed what
the government would allow, unlike the consumerist American society.
Now the Chinese market is opening up and the demand for higher
quality products is rising. This rise will also mean a rise in the
demand for minerals and carbon fuels that China will have to import.
Naturally the best import is from the closest producer
region...Alaska.
Anglo-American's
stock has shown a slow decline for the last 4-5 months as they are
“re-grouping”, by divesting themselves of peripheral projects.
So far it doesn't appear as if their Alaskan interests are on the
chopping block. They are in need of someone who is more financially
savvy to get them moving again. Chatter on investment and industry
sites/blogs is that Anglo-American is leaning towards Alex Vanselow
as her replacement. He most recently was the CFO of BHP Billiton
which is the world's largest mining company headquartered out of
Australia and London. BHP Billiton is the responsible for the
accidental and purposeful destruction in Papua New Guinea at the
infamous OK Tedi Mine. The mining giant denied for years that acid
rock drainage and even broken tailings damns were responsible for the
ecological disaster occurring downstream from several mines. Now
they tout their environment cleanup as a major economic driver for
the island and continue to operate in the area.
Adjacent
to the famed Pebble deposit lies at least two more projects of comparable
scope; the Big Chunk and AUDN projects are promising to possibly
yield even more resource than is predicted by the Pebble Limited
Partnership. Both of these projects have drawn the attention of huge
international mining entities, but remarkably haven't drawn any
attention by Alaska media outlets. It's like being invaded and no
one cares...
The Big Chunk Super Project is owned by Liberty Star Uranium &
Metals Corporation and is positioned just to the North and West of
the Pebble claims above the headwaters of the Mulchatna River. Just
last week, Liberty Star announced that they would cede a portion of
their claim to Northern Dynasty Minerals (½ owner of Pebble) to
satisfy a 4 million dollar debt owed to Northern Dynasty Mines (½
owner of Pebble). Preliminary evaluations of data collected by
Liberty Star and it's contractors indicates several mineral-rich
deposits within the property and consultants have indicated that the
2010-2012 drilling warrants further investment towards establishing a
mine permitting process for the Big Chunk claims.
Earlier
this year, LibertyStar dispatched Larry Liang to China looking for
investors and from what I read in several investor forums and blogs
he received a favorable reception and some commitments to develop
investment and JV plans. Something has obviously worked out for this
project, as their operations expanded to the establishment of a
sizable base camp and helicopter deployment of specialized drill rigs
this summer.
Two
other projects also underway being run by Millrock Resources are
called Humble and AUDN. Both are in the drilling exploration stage
and as I have written before, these projects are just waiting for
Pebble to get the go ahead to build the massive infrastructure
required and dig their holes. The 2012 drilling season saw MillRock
very active all over Alaska and getting good results from their work.
This was to only be predicted, as the exploration is being led by
the man credited with finding the Pebble deposit.
The
AUDN Project is being explored by Millrock Resources, a Canadian
headquartered mineral exploration company that is Co-owned and
Co-operated by Greg Beischer. Mr. Beischer is formerly an employee
of the Bristol Bay Native Corporation and ran several resource
management programs for BBNC until his departure to form Millrock and
several other entities. The other partner in Millrock is Phil St.
George, the man commonly credited with finding the Pebble deposit.
The capitalization for MillRock is curiously listed as 25% “Strong
Hand” investment. This means that some private agreement with a
“private” interested entity will yield a return to that investor.
Most commonly these investment agreements have several ways of
severance once certain preset expectations are met by the company
receiving capitalization investment. In the mining sector, it is
common that project generator companies like MillRock and investors
will opt for a cash out once a project reaches a certain point but
may retain a small remainder. In the case of MillRock, I believe
that the strong hand investment also includes exploration rights on
land owned by the investor.
The
financing of Millrock's exploration dozen or so Alaskan projects is
also somewhat interesting. During a recent presentation in Canada,
Beicher outlined the companies philosophy and fiscal state. The list
of investors is filled with the usual big mining suspects...
Kincross, Teck (Cominco), Inmet and of course Vale S.A...
Yes,
in 2012 the Brazilian mining giant Vale opened shop in Bristol Bay
Alaska. Sometime in October of 2011, Beischer attained a JV
financing agreement with Vale S.A. For the AUDN Project. Regional
reconnaissance conducted by Millrock led to acquisition of the
mineral rights in 2012. The property consists of 280, 160-acre State
of Alaska mining claims covering approximately approximately 18,130
ha. 44800Acres... of pristine Alaskan wildlife habitat designated
for mineral extraction.
So
who is Vale S.A.? Vale is the second largest mining company in the
world. They have massive holdings across the globe and are now just
showing interest in Alaska. This is no doubt due to the “friendly”
regulatory processes, low severance taxes levied on mining and the
proximity to their largest customer, China. Now after spreading
environmental destruction everywhere else, this Brazilian
conglomerate has decided to share their expertise in the rarest
watershed on Earth.
Elected
world’s worst company in January 2012 by the “Public Eye
People’s”, award that refers to human rights and environment,
held since 2000 by Greenpeace and Berne Declaration. Vale became the
first Brazilian company to “win” the award, also known as the
“Oscar of Shame”. The choice was made by public vote, and Vale
received 25 thousand votes. The Japanese company Tepco, which
operates the nuclear power plants of Fukushima that were hit by a
tsunami in March 2011, was the second in the election.
Vale's
reputation of deforestation, water pollution and environmental
disaster all across the globe is deplorable. Currently they are
partnered to construct a series of damns in the Amazon that will
displace almost 50000 people from traditional homelands and dry up
millions of acres of rain forest. But they don't mind using some
good ole' strong hand tactics to get their way either.
On
January 8th and 9th, 2007, hundreds of police and soldiers in
Guatemala forcibly evicted the inhabitants of several communities who
were living on lands that a Guatemalan military government had
granted to Vale' INCO mining. With the force of the army and police,
company workers took chainsaws and torches to people's homes, while
women and children stood by. Yes folks, this is what industrial
scale mining is all about... Profits over People.
So...
now it's winter time here in Bristol Bay as we stoke the fire to keep
warm and eat the harvest of summer's wild salmon, berries and moose,
I want to remind us all that the natural selection of resources her
in Bristol Bay have remained so for thousands of fishing seasons,
hunting seasons and seasons of darkness. This is all being
threatened by these projects and others as foreign conglomerate
corporations continue to follow their patterns by targeting resources
in areas where the population is primarily indigenous. The impact of
this regulated destruction of one of the last natural watersheds on
Earth will last forever... no amount of gold, copper, molybdenum,
lithium or iron is worth the cumulative losses that not only
Bristol
Bay will suffer, but the rest of the World shall as well.