Market News

 October 20, 2016
Alaska Communities Wary of Upstream Canadian Mine Projects

 If Heather Hardcastle had her way this summer, she would have been working on her family's commercial fishing vessel on Alaska's Taku River with her husband and father, hauling in sockeye, pink and chum salmon.

Instead she has been leading a campaign to protect waters they believe face contamination threats upstream in British Columbia, where mineral mines are in various stages of being proposed, getting permits or in operation.

"My parents have always told me---we still talk about this---you have to respect the salmon," she said. "Salmon has given us our livelihood, it's given us our family and it's given us our sense of place. This is all about the place and the salmon make the place."

Fishing is the largest private sector industry in southeast Alaska. One of the state's most productive salmon runs is here in three bountiful rivers: Stikine, Taku and Unuk, where hundreds of thousands of salmon return each summer. The watersheds are worth close to $48 million annually to the fishing industry, according to a recent economic analysis.

The proposed and operating gold, silver and copper mines in British Columbia are in watersheds 40 miles to 150 miles from the U.S.-Canadian border along Alaska's Southeast panhandle.

In British Columbia, mining for coal and minerals is an economic driver. More than 30,000 people are employed by the industry and related fields, and $476 million is invested in mineral exploration, according provincial data.

Debate over the competing resources focuses on whether provincial oversight provides enough environmental protection and accountability. Alaska groups, like Hardcastle's Salmon Beyond Borders, say the province has not done enough to protect the environment.

Their views were backed up in May by a report by British Columbia Auditor General Carol Bellringer, who said the provincial government's "compliance and enforcement activities of the mining sector are inadequate to protect the province from significant environmental risks."

Mount Polley Mine Spill

Concerns also stem from a massive spill two years ago from a mine in British Columbia, even though that spill did not reach Alaska waters.

The breach of a dam holding back a pond of tailings, or toxic waste materials, occurred Aug. 4, 2014, at Imperial Metals Corp.'s Mount Polley gold and copper mine in central British Columbia. More than 20 million cubic meters of water, mine tailings and construction materials coursed into into nearby waterways, according to claims in a lawsuit by a B.C. aboriginal group. The Tsilhqot'in National Government said the breach seriously affected traditional fishing.

Concerns remain high among commercial fishing and tribal groups, coastal communities and the tourism industry in an area receiving more than 1 million visitors annually.

But "one accident in 100 years does not constitute a pattern of conduct with a jurisdiction or a person for that matter," British Columbia Minister of Energy and Mines Bill Bennett told Bloomberg BNA. "We also recognize because we had that accident and because there were already concerns, we've got a job to do to try to build back public confidence in Alaska."

Concerns About Spill in B.C

But area communities have suffered and remain concerned over environmental damages that have not yet been fully assessed, said Bev Sellars, chief of the Xat'sull First Nation at Soda Creek, British Columbia.

Fishing lodges, she said, aren't getting booked as fully as in the past, and residents are afraid to fish in nearby rivers that feed into Quesnel Lake, where waste floated.

"We still don't know the effects, and we might not for several years," Sellars told Bloomberg BNA. She attended an Alaska State House Fisheries Committee hearing in Juneau Oct. 12 to discuss the transboundary concerns. "People up there are scared," she said. "People here should be scared."

David Chambers, a geophysicist who tracks breaches worldwide told the committee the Mount Polley accident cost $600 million. He said there aren't enough safeguards to cover losses.

Alaska groups and the state's Department of Natural Resources are watching the seven mine projects in British Columbia. Two of them, the Mount Polley mine and the Red Chris mine, an open copper and gold mine also owned by Imperial Metals, are currently operating.

Seven Mines in British Columbia
The State of Alaska as well as community and industry groups are keeping an eye on British Columbia mineral mines under development in watersheds feeding Southeast Alaska fishing streams.

There are currently seven major mine projects that are being tracked by state agencies:• Tulsequah Chief Mine: Proposed as a copper, led, zinc, gold and silver project. It's about 10 miles from the Alaska border.• Red Chris: Currently producing copper and gold, about 150 miles from the border in the Iskut/Stikine watersheds.• Schaft Creek: Proposed open pit silver and gold project about 40 miles from Alaska border in the Stikine watershed. • Galore Creek: Proposed open pit copper, gold and silver project about 25 miles from Alaska in the Stikine Watershed. • Kerr-Sulphurets-Mitchell (KSM): Proposed open pit copper and gold project about 20 miles from Alaska in the Unuk watershed. • Brucejack: Proposed underground gold project about 25 miles from Alaska near Brucejack Lake, which drains to the Unuk River via Sulphurets Creek.• Mount Polley Mine: Open pit copper gold mine located in south-central B.C in the upper region of the Fraser River watershed, which does not drain to Alaska waters.

Source: Alaska Department of Natural Resources

Alaska, British Columbia Collaborate

For now, there are cooperation agreements between British Columbia and Alaska, but these documents lack the legal accountability that Heather Hardcastle and her husband, Kirk, and others seek. A memorandum of understanding from November 2015 and a statement of cooperation on Oct. 6 address agreements to consult one another and conduct some baseline testing of waters before the mines go into operation.

Gavin Dirom, president and CEO for the Association for Mineral Exploration British Columbia, said differences are being handled well locally. The memorandum of understanding last year and the Oct. 6 statement of cooperation illustrate growing collaboration, Dirom said.

"The people who live in the area know the area best," Dirom said. "Local scientists understand all of the intricacies of what's actually happening on the ground."

Dirom said he understands the concerns of Alaskans, but said criticisms such as those by the province's auditor general are being addressed with greater oversight. A mining compliance and enforcement board was recently established to oversee all aspects of mining, particularly environmental protection.

Lawmakers Seek Federal Involvement

The Hardcastles hoped the Mount Polley breach would trigger U.S. federal intervention through the International Joint Commission under the 1909 Boundary Waters Treaty. The commission is designed to resolve cross-border disputes when an activity in one country threatens the waters in another.

Alaska's congressional delegation, Sens. Lisa Murkowski (R) and Dan Sullivan (R), and Rep. Don Young (R) have asked the State Department for federal involvement. The three reached out to Secretary of State John Kerry in a May 12 letter following the report by the British Columbia auditor general.

Kerry's office responded one month later, and said the U.S. did not intend to refer the issue to the International Joint Commission.

Kerry's office said problem solving belongs at the state and provincial level, and cited agreements already in place and communication between Canadian officials and U.S. agencies. The delegation and Kerry's office have since exchanged two more letters about federal involvement, including a letter from Kerry's office Oct. 6 offering assurances of engagement.

"What we need is to make sure our political system gives a valued voice to primary economic drivers and stabilizing economic drivers within a state, and that's fishing," Kirk Hardcastle said. "Right now that's not happening."

He said he does not think it's right to look at the Mount Polley breach as a once in 100 years type of event.

"To me it's one in the last two years," he said. "I keep telling people this: 'Maybe it's one in 100 years, but one in 100 years doesn't mean you get a free pass for the next 99 years.'"