Fort Knox celebrates 20 years: area's gold history dates to 1901.

• Author: Stricker, Julie
• Position: SPECIAL SECTION: Mining

December 13, 1996, was a milestone day in Interior Alaska as Amax Gold workers poured the first bar of gold from Fort Knox. It was the beginning of commercial production for a mine that would become the most productive source of gold in Alaska.

At startup, Fort Knox was estimated to have reserves of 4 million to 5 million ounces of gold with an estimated mine life of twelve years. But even then, according to Tom Irwin, Fort Knox operations manager at startup, they suspected the resource was richer than early estimates showed.

"We didn't know exactly what we had," he says. "We knew it would support a very large mill. Early on, we thought we had 5 million recoverable ounces, and our drill holes mostly ended in mineralization," indicating the potential for more reserves below.

As time went on and the drills were able to go deeper, that additional mineralization added more than 2 million ounces of gold and more than a decade of operations. In July 2016, Fort Knox poured its 7 millionth ounce of gold and is celebrating twenty years of production.

The story of Fort Knox begins with Felix Pedro's 1901 discovery of gold in what are now the Fish and Pedro creek valleys, twenty-six miles northeast of Fairbanks. For nearly a century, sporadic placer mining and dredge operations took out a fortune in gold from the two valleys.

And there was more gold to be found.

In 1984, a geologist discovered visible gold on the Fort Knox claims, just upstream from the areas previously mined. In 1992 Amax purchased the Fort Knox project and in 1998 merged with Kinross Gold Corporation, which still owns the mine.

A Golden Team

Amax put together a strong team to design and plan Fort Knox's startup, which was crucial to its long-term success, Irwin says. Among them were Chris Kennedy, who is now general manager at Pogo Mine, an underground gold mine operated by Sumitomo sixty miles northeast of Delta Junction; Fort Knox General Manager Eric Hill; and Chief Metallurgist Jim Oleson.

"It always comes down to the team," says Irwin, who is now vice president at International Tower Hills and working to bring a gold mine online at Livengood that has potential reserves even richer than Fort Knox's. "No one does it alone; you can't do it alone. It's always the team. I was very proud to work with those folks."

Oleson started working at Fort Knox during construction of the laboratory at the mill.

"The mood was very exciting," he says. "We came from a gold mine in Nevada that was on its downward path to closure. It was very exciting to come up to Alaska to a brand new property, new construction, a lot of money, and a lot of gold."

The ore at Fort Knox is low-grade, less than 1 gram of gold per tonne, and is generally visible only under a microscope. To make the recovery of the gold economically feasible, the mine operates on an enormous scale. It has a fleet of Caterpillar trucks, the smallest of which carries 150 tons---the largest is 240 tons and is the size of a two-story building. They travel dusty roads between the giant, open pit and the crusher or the heap leach in a meticulously organized ballet.

The movements of the each truck, loader, and shovel are precisely mapped and planned for maximum efficiency. It is such an efficient system that Fort Knox is one of the lowest-cost, highest-producing mines in Kinross' portfolio, with production costs of roughly $600 per ounce of gold.

The ore is processed by two methods. The higher-grade ore is processed through the carbon-pulp...