New mine plan brings back old fears in Southeast Alaska

JUNEAU -- Facing difficulty in getting a road through rugged terrain to Canada's Tulsequah Chief mine, the company that wants to reopen the old gold, zinc and copper mine is now planning instead on bringing the ore out through Alaska by barge.

That's raising concerns in Alaska's capital city of Juneau, where the barges would pass through. The Canadian mine is just east of Juneau.

Chieftain Metals Corp. of Canada has provided few details so far about what that new barging plan would entail and what sort of regulatory hurdles there might be in either Alaska or British Columbia.

But the mine and its new proposed access plan are renewing fears for the Taku River, one of Southeast's top salmon-producing rivers, and a part of the foundation for local gillnet, sport fishing and tourism industries. The Tulsequah River flows into the Taku, which would be used for the barging plan.

Alaska Fish and Game officials say the Taku River drains one of the largest almost-entirely roadless watersheds on the West Coast, and provides spawning habitat for all five Pacific salmon species and habitat for an abundance of other wildlife.

Rep. Cathy Munoz, R-Juneau, said this new plan would need to be watched closely.

"We definitely need administration involvement and the Department of Natural Resources to be at the table to make sure the river is not impaired or put in any danger because of the activity," she said.

So far, not much is known about what Chieftain is proposing, and top company officials have not responded to interview requests.

Previous plans had called for using barges to bring in some mining equipment, which could be done during periods of high water.

But the bigger challenge for the mine is how to get the ore concentrates out for shipment to smelters elsewhere. The company said previously that the Taku River, which is latticed with sand bars and empties into Taku Inlet near extensive mudflats, would make barging impractical, and that a $100 million road would be needed.

But last month, Chieftain revealed a dramatic shift in regulatory filings and a statement on its website.

"Concentrate produced during operations are planned to be barged, in containerized bags, along the Taku River to a transfer barge at the mouth of the river and then on to the port of Seattle to be shipped to Asia," the company said.

The international boundary is just downriver from the mine, near the mouth of the Taku River.

More detail will be unveiled in a feasibility study expected to be released in December, the company said.

Chris Zimmer with the environmental group Rivers Without Borders has been raising concerns about several Canadian mines that are being advanced by the government of British Columbia, but which also have the potential to threaten Alaska.

He said that statements made by Chieftain Metals representatives to justify the mine's formerly proposed 80-mile access road appear to conflict with the new barging proposal.

"It really flies in the face of all their past statements and analysis of barging," Zimmer said.

Chieftain representatives told the Taku River Fact-Finding Task Force, convened by the Juneau delegation, that to operate the mine they needed to be able to ship 148,000 tons of ore concentrate annually, but that conventional river barging only provided the capability to ship 22,000 tons during the months of high water.

The new feasibility study will look at a plan to "optimize" the mine's operation, which appears to make it smaller, possibly changing the viability of barging.

Making the proposed changes in development of the Tulsequah Chief project results in "dramatically improving the financeability of the project," the company said.

This isn't the first go-around for reopening the mine. The mineral deposits were discovered in the area in 1929, and Cominco Ltd. began operations at the Tulsequah site in 1951, but shut down in 1957 due to low metal prices. Cominco had previously used barges to export ore from the nearby Polaris-Taku mine just south of the Tulsequah Chief mine, but one of its barges loaded with gold concentrate sank in a storm off British Columbia in 1951 and the Polaris-Taku mine was shut down.

In 1992, Redfern Resources purchased the Tulsequah Chief site and invested hundreds of millions in building site roads, an airstrip, mill processing and waste storage areas and obtaining construction and operating permits.

Redfern had proposed an unusual plan to use air-cushion "hover" barges to move ore down the river, where it would be transferred to ocean-going barges. The hover barges' ability to deal with the Taku River's shallows would boost annual shipping capability to 78,000 tons of ore, the task force was told.

Redfern never won approval for the hover barges and filed for bankruptcy in 2009. Chieftain bought Redfern's assets and permits.

But those who have been watching the process remain skeptical of Chieftain's new proposal.

"The costs and limited window for the mining company to barge ore only during a limited high-water season on the Taku made it seem uneconomical at the time," said Richard Yamada, a Juneau charter-boat skipper who served on the legislators' task force and studied the project.

Yamada said the Tulsequah Chief project gives all the benefits to Canada, while shifting much of the risk to Alaska if something goes wrong.

"We have no oversight over mining development in Canada and no assurances that Canada would step in and mitigate the damages from an environmental disaster if the mining company that caused it goes bankrupt," he said.