Mining in Western Alaska: historical success, good access, elevated metal prices drive activity.

• Author: Liles, Patricia
• Position: MINING

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Blasting crews work on the initial development stages of the Rock Creek open pit in late August, preparing for the start of gold mining at the Nome-area facility. Rock Creek is estimated to contain roughly 500,000 ounces of gold, providing a five-year mine fife for the operation. Owner and operator NovaGold Resources anticipates extending mine life with mill feed from satellite-deposits, and spending $7 million on related exploration efforts this year.

Western Alaska's mining industry kicked off with a boom at the start of the 20th century with discovery of large quantities of placer gold in the streams and on the beaches near Nome--one of the major gold rushes in Alaska.

While most of the activity concentrated around Nome, which once was Alaska's largest city with a population nearing 20,000, prospectors fanned out over the Seward Peninsula, making discoveries throughout the region.

Today's modern prospectors--looking for gold as well as other precious and industrial metals including uranium--are following up on some of that past work, combining historical data with technological advancements to make new discoveries.

"Properties on the Seward Peninsula have historically been the focus of much exploration due to the great mineral endowment of the area and relative ease of access for many parts of the peninsula," said David Szumigala, senior minerals geologist at Alaska Division of Geological and Geophysical Surveys.

Unlike many rural areas of Alaska, Nome and its surrounding area in the Southwestern part of the Seward Peninsula has a network of existing roads, providing adequate vehicular transportation from Nome in summer months.

And Nome, with its roughly five-month, ice-free ocean-going shipping season, provides a regional base for deliveries of large-scale equipment used in mining exploration, development and production.

"Nome and the entire Seward Peninsula is a good place to work," said Rick Van Nieuwenhuyse, president and CEO of NovaGold Resources, a Vancouver, B.C.-based junior exploration company that has completed the latest addition to Alaska's hard-rock mining industry, the Rock Creek gold mine near Nome.

"There's easy access, good infrastructure in and around Nome. We plan to continue working in the area--we have a very large land package," Van Nieuwenhuyse said. "The Native corporations are wonderful partners and we plan to continue that relationship."

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Also contributing to the region's "reasonably active" mine exploration activity are higher commodity prices, according to Rich Hughes, development specialist in the state's Office of Economic Development/Minerals.

"Nome off-shore placer gold is attracting attention that may revive mining of this source," he said. "No significant increase in placer gold production is noted in the region due to operating cost increases."

WESTERN ALASKA EXPLORATION

Encompassing an area as large as some of the nation's Midwestern states, Alaska's Western mining region includes a number of players working on several projects.

"Currently the largest exploration projects are being conducted around the Rock Creek project by NovaGold. Other companies exploring for gold on the Seward Peninsula during 2007 included Alix Resources and Millrock Resources at the Divide property, Gold Crest Mines at the Kelley Creek property, and Andover Ventures at the Bulk Gold property," said Szumigala. "There were two other large gold exploration programs in...