Alaska News

Foreclosure extended for Southwest Alaska platinum mine

As potential Bristol Bay mining continues to be a point of contention across Alaska, the future of one long established mine remains to be seen.

The platinum mine of Goodnews Bay -- between Togiak and Bethel -- is in a state of extended foreclosure in the Anchorage court system.

Former owner Hanson Industries of Spokane, Wash., sold the mine to XS Platinum of Seattle, Wash., several years ago. But when the purchaser defaulted on the payments -- of which $56 million remain to be paid -- Hanson instigated a foreclosure action.

The foreclosure sale was set for Friday in Anchorage, but was postponed until Aug. 13 as a sort of forced payment plan.

"There's a kind of payment retainment agreement in place where they pay some money and get an extension," said attorney Cabot Christianson of Anchorage's Christianson and Spraker. Christianson represents Hanson Industries.

It's likely that the foreclosure will be postponed in this fashion again, Christianson said, if it proves to be an effective method of collecting payments.

While Christianson could not speak directly to the mine's future operations, (XS Platinum could not be reached for comment) he said it was his understanding that XS intended to bring the mine back into operation next year.

While it was operational last year, XS has not been operating the mine this year.

Native Alaskan Walter Smith first discovered platinum traces near the traditional village site of Arviq in 1926. In the mid-1930s, two large mining companies took over the small claim operations, the hand-mining methods of which could not reach the deposit's depth. The primary company was Goodnews Mining Co., which acquired more than 150 claim titles in the area.

Over the decades of pulling platinum up from the earth, the community of Platinum grew up around the mine operation, establishing offices, schools and community government.

During that time, it is estimated that more than 540,000 ounces of platinum came out of the operation.

Goodnews Mining eventually sold to Hanson Industries in 1979. They estimated the deposit still contained around 500,000 ounces of platinum.

Hanson operated the mine for about a decade, but eventually let it sit dormant until selling to XS Platinum in 2008.

Platinum is considered a rare and precious metal, and is used in various types of laboratory and medical equipment, electrical contacts and jewelry. Its compounds are used in chemotherapy treatments.

In the United States, the recent price per ounce for platinum has averaged around $1,400. Gold is currently drawing a $1,600 price tag in the U.S.

This article was originally published in The Bristol Bay Times and is reprinted here with permission.

Hannah Heimbuch

Hannah Heimbuch is a reporter for The Arctic Sounder and The Bristol Bay Times-Dutch Harbor Fisherman.