Plugging in! Power generation for remote natural resource development is high on the priority list for many.

• Author: Liles, Patricia
• Position: Natural Resources

Alaska's wealth of large natural resources, whether they be oil and gas, minerals, timber or seafood, typically are located in remote regions, far from the state's existing electric power infrastructure.

Transforming natural resources into a value-added product that creates a return on the investment usually requires industrial power-large amounts of reliable electricity on a constant basis. That basic need oftentimes provides a substantial hurdle to development, despite the size of a resource.

The Donlin Creek gold deposit provides one clear-cut example of that dilemma, although its current operator, Placer Dome, is considering a novel, environmentally friendly alternative for electric power generation.

Located in remote rolling hills about 12 miles north of the Kuskokwim River village of Crooked Creek in Southwest Alaska, Donlin Creek is believed to host at least 25 million ounces of gold, an extremely large, relatively low-grade sulfide deposit. Separating gold from the host rock would likely require an autoclave process, which adds oxygen and heat to crushed ore, increasing a mine's power demand.

ACCESS LIMITED

Currently, access to Donlin Creek is by air, as there are no truck-accessible roads to the deposit, only a seasonal trail that the developer is considering upgrading to a haul road. Nor is there any large, local electric power source, capable of providing the 75 to 80 megawatts of power that will be required to mine and mill the deposit.

"It's not the logistics or the grade that are the holdup-it's the power requirement," said Doug Nicholson, vice president of NovaGold Resources Inc., a junior exploration company that earned a 70 percent interest in Donlin Creek in 2002 after completing a $10 million exploration program. "If we can figure out how to get around that, we can open it up."

After working the property for nearly two years, NovaGold signed in early 2003 a joint venture agreement with Placer Dome, allowing the major mining company to re-earn a 70 percent interest. To do so, Placer Dome must spend $30 million on the property, complete a feasibility study, acquire permits for operation and bring Donlin Creek to a mine construction decision.

OPTIONAL POWER

A large part of the economic consideration involved in that process is resolving the power supply issue. Placer Dome has spent considerable effort researching that infrastructure need and has recently selected a preferred alternative-on-site power generation, according to acting project manager James Fueg.

Either diesel or liquid propane gas, which will be barged up the Kuskokwim River and then hauled to the mine site, will provide the fuel source for generating 100 percent of the mine's electric needs, he said.

Along with that traditional fossil fuel source, Placer Dome is considering tapping wind for power generation, Fueg said, although...