Service companies support mining industry: as the state's gold mining industry has grown, so has the demand for related services-geologists, environmental research firms, equipment suppliers, drillers, expeditors and remote camp operators.

• Author: Jones, Patricia

There's a real need for mining service companies in Alaska. Just ask Jerry Back.

Back started his Fairbanks-based drilling company in the early 1980s as an offshoot of the construction industry, completing soils tests for residential and commercial buildings.

The local mining industry quickly took notice of the new drilling operation, and GF Back Inc. soon landed jobs that involved exploration drilling for gold. Back then, placer miners and hard rock prospectors relied on the underground samples to dictate where future mining operations would be located.

"Things were rocking all over the state," Back recalled. "Initially I was doing the drilling and had one helper, then helpers turned into drillers and we had multiple rigs going."

Gold prices, then more than twice the current price for the precious metal, contributed to an active industry in Alaska, Back said.

"There were a lot of old families.... I had friends who were born on the creeks and grew up on the creeks--that was all they had done," he said.

But things changed in Alaska's mining industry in the late 1980s and the early 1990s, as small operators phased out and larger corporate prospectors and operators became a force in the Last Frontier.

"A lot of the creeks were just mined out, and the regulations changed, which affect how small guys operate," Back said. "And the price of gold is down. People just can't afford to mine what ground is left."

No matter what size the operation, low gold prices have plagued miners in Alaska in recent years. Exploration spending dropped to record lows in 2001, and state production of gold has slowly declined.

Like other companies in the mining service industry, Back has diversified his operation to maintain during the recent slowdown. Fortunately, his skills are high in demand--CF Back crews have completed water well drilling, boring holes for foundation pilings, even doing some drilling work for the oil and gas industry.

"Diversity is the key," he said. "We've been doing a lot of pilings--everything from hippie cabins to bridges."

Yet Back is optimistic that Alaska's mining industry will experience a positive turnaround, although that could come some years in the future.

"Alaska has the fuel and the minerals," he said. "Overseas, we depend on these rare earth minerals in a lot of countries that are getting flaky, but we have the same minerals here. If we get shut down there, then people will come back home and produce them here."

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