Business/Economy

Donlin Gold starts biggest drilling program in a decade

Donlin camp Sept. 21

The leaders of Donlin Gold aren’t waiting for spring to get started on the largest drilling program in a decade at the world-scale Western Alaska gold prospect.

A warm-up crew worked to clear the camp for about two weeks before drilling started Jan. 30, Donlin Gold spokeswoman Kristina Woolston said. The conditions slowed the work some, she added.

“Clearly, weather has been a factor. It was 35 below at camp the other day. It’s been a cold start to winter,” Woolston said.

Donlin is starting its $60 million 2022 drilling program with two rigs and work will eventually ramp up to five or six active rigs by midsummer, according to Woolston. The roughly 34,000 meters of largely infill and geotechnical drilling planned for this year would be about 40% more work than was done last year.

A 50-50 joint venture between Vancouver-based NovaGold and Toronto-based mining giant Barrick Gold Corp., Donlin’s large drilling program will inform an updated feasibility study as Barrick and NovaGold continue toward a final investment decision on the $6.7 billion open-pit mine.

The U.S. Army Corps of Engineers approved the project’s environmental impact statement in 2018, though several other approvals are still needed, including the key state dam safety permit.

The $6.7 billion construction cost estimate was developed from the last feasibility study done on the project in 2011.

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Starting in winter will help give drilling crews time to get the work done, but also makes reaching some drilling targets more practical, Woolston noted. It’s also not the first time Donlin has done this kind of work in the winter, she said.

“There are some aspects of the drilling program that are more efficient in the wintertime,” Woolston said. “Much like on the North Slope, accessing some areas when they’re frozen is much easier on the terrain.”

As proposed, the open-pit mine in the upper Kuskokwim River drainage would be one of the world’s largest, producing more than 33 million ounces of gold over an initial 27-year life. A 315-mile natural gas pipeline from the west side of Cook Inlet would supply a power plant at the mine, and fuel storage tanks would be built at Dutch Harbor, in addition to the very large scale operation at the mine site.

Located on land owned by The Kuskokwim Corp., the area Alaska Native village corporation, the mineral rights to the deposit are controlled by Calista Corp., the regional Native corporation.

Opposition to the mine has increased in recent years from area tribes and other Indigenous groups. They contend the mine will irreparably damage the Kuskokwim’s fisheries, which are a primary subsistence resource for area residents. More than a dozen tribes in the region have formally opposed Donlin since the project got its overarching federal approval.

Leaders for Donlin, TKC and Calista insist locals’ fears often stem from them being misinformed. They highlight the roughly 3,000 construction jobs and 1,400 other jobs expected during the life of the mine, as well as the prospect of utilizing the project infrastructure to help lower energy costs in the region, which are among the highest in the country.

Donlin currently employs roughly 100 workers at the camp when activity is high.

Elwood Brehmer can be reached at elwood.brehmer@alaskajournal.com.

Elwood Brehmer, Alaska Journal of Commerce

Elwood Brehmer is a reporter for the Alaska Journal of Commerce. Email him: elwood.brehmer@alaskajournal.com

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