Business/Economy

Operator of Red Dog zinc mine in Northwest Alaska advances plans that could lead to large expansion

Red Dog Mine

The company that operates the Red Dog zinc mine in Northwest Alaska is seeking state and federal approval for a multi-year exploration plan in the area that could one day lead to a large expansion of its operations.

Teck American, a subsidiary of Teck Resources in Canada, has applied with the Alaska Department of Natural Resources to build a 10-mile exploration road, plus bridges and related facilities, the agency said in a public notice last week.

The road would extend from the mine to two large new prospects to the north, known as Aktigiruq and Anarraaq.

The Aktigiruq prospect could be one of the largest undeveloped zinc deposits in the world, comparable in size to the valuable Red Dog mine that has already operated more than 30 years, according to a 2020 report from the state’s geological survey division.

The prospects are located on state land, and are seen as a way to extend some of the benefits of Red Dog to the region, an economic powerhouse with revenues that support the borough and Alaska Native corporations and villages.

Red Dog’s mine life, based on existing, developed deposits, is expected to run out in 2031, Chris Stannell, a spokesperson with Teck Resources, said in an email.

“This exploration program would be focused on extending Red Dog’s mine life and in turn continuing the significant social and economic benefits that the mine contributes to the region,” Stannell said.

Stannell said the new prospects, if developed, would use existing facilities at Red Dog.

”Should the exploration program be successful, a proposed extension would source zinc ore from underground and operate primarily within the existing mine footprint,” using current mine infrastructure such as the mill, Stannell said.

[Many see the Red Dog mine as an ANCSA success story. What happens when the ore runs out?]

Teck American’s application for a state permit is a first-phase step in its effort to conduct more extensive exploration at the prospects, said Kyle Moselle, executive director of the office of project management and permitting at the Alaska Department of Natural Resources.

The mining company has been exploring the site for years using a relatively limited surface drilling program, he said. Equipment has been hauled in by helicopter under a state miscellaneous land-use permit, Moselle said.

The company wants to tunnel underground to drill and explore the prospect from below the surface, allowing a more thorough look at the mineral resource, Moselle said.

The underground site will allow year-round drilling and a shorter time frame to collect geologic data to help make a development decision, said Stannell with Teck Resources.

The company plans to apply for the tunneling work next, in a second phase that will also require a state permit, Moselle said.

“They want to do the work to see if it can be an economically viable mine,” Moselle said. “Going underground shows they believe it is likely a viable resource there, but they have to do work to prove it up.”

Red Dog, one of the world’s largest zinc mines, is located about 500 miles northwest of Anchorage, near the villages of Kivalina and Noatak. The mine last year recorded gross profit of $678 million as zinc prices rose, more than 30% higher than in 2020, according to Teck’s annual report.

The mining company’s current application, if approved, would also allow it to extract gravel to create the main road, smaller secondary roads and surface pads on the tundra. The pads would support structures associated with the next phase, like a man camp and fuel storage, according to the plan of operations.

Teck American has also filed a plan designed to protect the caribou population, an important subsistence food, and a reclamation plan for restoring the area at the end of the project.

In its application paperwork, Teck American included a letter from NANA Regional, the Alaska Native corporation for the Northwest Alaska region, to the state Department of Natural Resources. The letter says NANA does not object to this first-phase plan to build the road and other infrastructure.

NANA owns the land at the Red Dog mine, and receives large royalty payments from Red Dog.

The mine in 2021 paid $255 million in royalty payments to NANA, according to Teck’s last annual report. NANA shares most of that income with other Native corporations, required by the 1971 federal law that established the corporations.

The mining company’s plans, particularly the ones to restore the environment and protect caribou, conform with NANA land-use policies, the letter from NANA says.

Lance Miller, vice president of natural resources for NANA, said the corporation supports continued exploration by Teck. The exploration is expected to last for years before a decision on development can be made, he said.

“NANA appreciates our partnership with Teck and we support efforts to extend the life of the mine at Red Dog, so we can continue to provide benefits to our shareholders and families within NANA and in the region,” he said.

Village leaders in Kivalina, about 50 miles southwest of the mine, said they worry that an expansion will increase pollution risks to drinking water and subsistence resources like fish from the nearby Wulik River.

Austin Swan, Kivalina’s mayor, said he and others will be tracking these new plans closely.

“It will always be a hazard to the Wulik River so they have to be real careful about how they operate,” Swan said of the mine.

“The river, our drinking water source, the fish, that’s my first concern, and I’ll speak up about that,” said Janet Mitchell, a city councilwoman in Kivalina.

Alex DeMarban

Alex DeMarban is a longtime Alaska journalist who covers business, the oil and gas industries and general assignments. Reach him at 907-257-4317 or alex@adn.com.

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