Constantine president Peter Mercer descends from a helicopter after a tour of drilling sites in August. Mercer said drilling work will be similar in the next two or three years, as the company starts to transition to more economic, environmental,. and engineering analysis that will result in a full plan for how to access the ore, which the company is shooting to release in 2026. (Lex Treinen / Chilkat Valley News)

Constantine president Peter Mercer descends from a helicopter after a tour of drilling sites in August. Mercer said drilling work will be similar in the next two or three years, as the company starts to transition to more economic, environmental,. and engineering analysis that will result in a full plan for how to access the ore, which the company is shooting to release in 2026. (Lex Treinen / Chilkat Valley News)

Constantine Mining president lays out timeline for Palmer Project work

Project north of Haines at least five years from decisions about mine development, executive says

  • By Lex Treinen Chilkat Valley News
  • Friday, December 8, 2023 8:58am
  • Newsmining

Constantine Mining, the company exploring a mineral prospect 40 miles north of Haines, is preparing to release a new operation plan at the beginning of next year, part of a regular permit renewal with the state Department of Natural Resources.

The plan is part of transition from mapping the deposit into a new phase of engineering work and financial analysis that would determine what a mine at the site might look like, said Constantine president Peter Mercer.

“The company is transitioning from exploring and mapping the deposit to a new phase of engineering, environmental, and financial analysis,” Constantine President Peter Mercer said in an email.

He said the Application for Permit to Mine in Alaska is in draft form. After it is submitted, DNR can open it for public comment, and the permits expire after five years.

Constantine poured $25 million into the Palmer Project, a copper, zinc, gold, silver and barite deposit above Glacier Creek, this year. Development of the project has divided Haines residents for years, with some worried about the potential environmental impact of developing the mine.

In a 45-minute interview at Constantine Mining’s office in downtown Haines, Mercer emphasized that even with the heavy investment, the project is at least five years from any decisions being made about mine development.

Mercer agreed to an interview on the condition that quotes and information directly attributable to him be reviewed by company officials. Direct quotations from the interview weren’t approved, and quotations in this story reflect emailed comments from Mercer.

Mercer said that public support would be an important factor in recommending a mine plan when a plan is released, likely in 2026.

“Public views, concerns, and support will be an important factor in the project’s assessment and will be documented in a pre-feasibility technical report (PFS), to be completed over the next three to five years,” he said

Project status and plans

This summer, crews on the company’s three active drilling pads in the mountains by the Saksaia Glacier worked 24/7 pulling out core samples that were analyzed at Big Nugget Camp, where work on the deposit is based.

The company hired several new project leaders, including Mercer, who took his position in May, plus new environmental manager Merlin Benner, a new safety manager, and HR manager Carolann Wooton, who previously worked for the Haines Borough.

The company employed about 30 seasonal employees this summer who lived at Big Nugget Camp and the newly built Klehini Camp. This winter, 10 full-time employees will continue to work on various aspects of the project, like further mapping the deposit based on core samples drilled this summer. In previous years, the company said it employed just five year-round workers.

Of the 30 seasonal employees, 14 are local hires, and four of the 10 year-round hires are locals.

Mercer said Constantine’s operation plan is being reviewed and will be submitted to the state Department of Natural Resources in the first quarter of 2024.

Public comment is generally open for 14 days, but sometimes extends that for up to 30 days based on factors like the amount of public input and the complexity of the project, according to DNR geologist Dave Charron.

Overall, the plan will likely include a continuation of current drilling work, Mercer said.

“Over the next five years, at the project site, there will be a continuation of diamond drilling to further define the mineral resources on the property,” Mercer said. “The proposed fieldwork planned in 2024 and 2025 is almost identical to what was completed in 2023, just over a little larger area.”

Mercer said the company would likely expand its seismic study work, and expand weather monitoring stations as part of environmental studies.

The project relies heavily on helicopter transportation to and from its core drilling platforms in the mountains above Glacier Creek. Bad weather can sometimes strand workers, who generally work 12-hour shifts, at emergency shelters near the platforms overnight.

Some of the current drilling platforms will be moved to other sites, in accordance with the company’s federal permit, to confirm the limits of the mineral deposit. And the company is aiming to release a pre-feasibility study of the mine in 2026.

Pre-feasibility studies have a margin of error as high as 25%, according to an article by Micon International, a mineral industry consultant. That will significantly improve the understanding of whether the project could make money. In 2019, the company published a preliminary economic assessment, which analysts consider to have margins of error of up to 40%.

The company had originally planned on presenting its operations plan at the Alaska Miners Association Convention in Anchorage in early November, but was unable to present because of time constraints at the conference, the company said in an email earlier in November.

Publicly released drilling results from the summer show the deposit – generated millions of years ago from an underwater volcano – is larger than previous estimates suggested. The company analyzed results from 12 of 24 drill holes, with results from the remaining drill holes to be released in the coming months.

Public input

In past years, it held regular public forums, but it has scaled back public engagement in the last few years, coinciding with a reorganization of the company and a partial buyout by DOWA Holdings.

This summer, it has shared information about its work at the Southeast Alaska State Fair, but has rarely appeared in public forums. The company hasn’t been in direct communication with Chilkat Indian Village, the tribe in Klukwan, this year.

Mercer said the company will boost up its public engagement to understand social and environmental concerns in the coming years. That will likely include open houses, fact sheets, and public presentations, though he didn’t give any specific commitments.

Mercer acknowledged the limited public presence the company has had during 2023 as the company transitioned personnel and work. He said some of the questions the public has raised don’t have answers – and won’t until the company collects further information.

For now, Mercer said the main thing he wanted to emphasize to the public is that there isn’t a mine at the site.

“There’s a belief that this is a guaranteed mine, or that mining activity is imminent or already taking place. There is still a lot of work to do, and we are still very far away from those decisions or recommendations,” he said.

The company still hasn’t determined how ore might be mined, how waste might be stored, and how ore would be transported. Those decisions are included in a mining plan.

Earlier this year, the company appealed a decision by the state Department of Environmental Conservation that required the company re-do an analysis of water quality Glacier Creek. Klukwan and other environmental groups filed to defend the DEC’s decision to require new water analysis.

The mine has divided the community of Haines for years. Opponents worry that an accident at the site could contaminate Glacier Creek, which runs into the Klehini and Chilkat rivers. The watershed supports a run of all five Pacific salmon.

Some residents have also questioned why the borough has committed sizable resources to some infrastructure projects that would benefit exploration and a potential mine.

Some assembly members and Haines Mayor Tom Morphet have suggested holding public referendums on whether the borough should invest in projects that would benefit a potential mine.

This story was originally published Nov, 29 by the Chilkat Valley News.

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