CHAPTER 8 INDUSTRY STATUS: MINING, 1978

• Jurisdiction: United States

Alaska Mineral Development
(Sep 1978)
CHAPTER 8
INDUSTRY STATUS: MINING, 1978
C. C. Hawley, Ph. D., Consulting Economic Geologist Institute on Alaska Mineral Development Rocky Mountain Mineral Law Foundation
Alaska Miners Association
Anchorage, Alaska

September 21, 1978

SUMMARY

Alaska's hard rock industry is currently divided about evenly with half or some 35-40 million dollars annually being expended for exploration and about half generated from production, including coal.

By geological characteristics much of Alaska is highly favorable for the occurrence of a variety of metallic mineral deposits. Actual prospective and advanced exploration areas are, however, constrained by land availability and economics to a small part of the favorable terrain. The most intensive prospective activities are in six areas, two of which are in Southeast Alaska, two in the Brooks Range, and one each in the Alaska Range and Yukon-Tanana regions.

Access remains both as a practical and legal problem, especially in the light of (d)(2), 603, or Rare II actions which may place widespread Wilderness designations on Alaska. It is very likely that designated Wilderness in Alaska will not carry the 1964 Act's mining exemptions—which are in themselves ineffective.

Geologically the outlook for Alaska's mineral remains excellent, especially because of the discovery of high-grade type deposits which can withstand economics of remote location. Current (d)(2) legislation approximating the Administrative position, if passed, would likely move back the start of anticipated significant Alaskan metal production from about 1983-85 to 1990-2000.

INTRODUCTION

Activities, as measured in dollars, related to hard minerals and coal in Alaska are about 70-80 million dollars annually and are divided approximately equally between production of coal, barite, gold, and tin and exploration for economically viable new deposits. Exploration is currently addressed mainly at the discovery of deposits of relatively high-grade type or of deposits of high-value commodities, although search for and evaluation of bulk low-grade deposits locally continues, especially in areas where transportation is not a major cost factor.

The most significant recent exploration development in the locatable mineral field in Alaska has been the recognition of deposits which are of moderate to large size and high-grade. These deposits range in size from 2 to at least 35 million tons, and contain one or more of the common base metals, copper, lead, and zinc along with significant by-or co-product amounts of silver and gold and rarer trace elements like cadmium. Several such deposits contain metal values in excess of 100 dollars per ton in zones suitable for large-scale mining. The deposits of this type, often called massive sulfide deposits, are widely distributed in Alaska and tend to occur in linear belts.

Other deposits of demonstrated near-future potential include bulk low-grade deposits of molybdenum, and of copper and nickel. Exploration is at a relatively intensive scale for uranium; some exploration effort is being expended on tin and tungsten.

Many of the impediments to mining in Alaska are involved with public policy issues, availability of land, access, wilderness status; others are more strictly economic or technical in the classic sense—i.e. tonnage and grade, labor supply, metallurgy. Essentially all deposits which appear to have near future viability are involved with the (d) (2) lands process—either directly because of presence in or adjacent to a conservation unit, or indirectly because of access.

MINING AND EXPLORATION

Mining of both hard rock "lode" and placer deposits was an important industry in Alaska from about 1880 until World War II and for most of this period was exceeded only by fisheries in statewide financial impact. Essentially stopping in World War II, mining resumed after the war on a gradually decreasing scale until the early 1960's when it virtually ceased except for a few family owned placer gold mines and one Alaska-owned coal mine. At least partly because of the present open market on gold, gold mining has increased since about 1973 to about its level in the early 1960's.

Especially in terms of gold, Alaska was a major historical producer, ranking nationally fourth after California, Colorado, and South Dakota in total production in the period of 1799-1965. In this period Alaska produced almost 30 million ounces of gold, mainly from four districts (Koschmann and Bergendahl, 1968). About two thirds of the Alaska production was from placer sources. Of the 8.9 million ounces from lode production, about 3 million ounces were from the Alaska-Juneau mine, produced by bulk underground mining methods from ore grading only 0.04 oz/ton.

Alaska also produced significant amounts of other metals, as shown on Table 1.

Except for gold, only limited reserves were developed in the period of historic metallic mining activity—which can be projected from purchase of Alaska until the early 1960's.

TABLE 1 ALASKA METAL PRODUCTION TO 1965

(U.S. Geological Survey, 1964)

Pounds of Metal	Ounces of Metal	Main Sources
Copper	1.4 billion	Kennecott, Prince William Sound, Kasaan
Silver	16.5 million	Kennecott, Alaska-Juneau, gold byproduct
Mercury	> 2.2 million	Kuskokwim area
Tin	6.0 million	Seward Peninsula, Manley
Antimony	6.0 million	Fairbanks, Stampede
Uranium	+ 2.0 million	Bokan Mountain, Southeast Alaska

PRESENT STATUS

Starting in the mid 1950's about with practical development of small helicopters, the main modern activity in...