Correction: An earlier version of this article stated that 47 percent of mining employees in Southeast live in Juneau. Only 47 percent of Southeast mining employees live in Southeast as a whole, not just Juneau. The article has been changed to reflect that.
In the wake of a prominent British Columbia mine ceasing operations, some in Southeast Alaska have expressed concerns about what it signals for the region’s future.
B.C. company Imperial Metals announced earlier this month that the Mount Polley Mine will stop production indefinitely due to declining copper prices. The mine became well known in 2014 after the dam on its tailings pond broke and dumped years of mining waste into nearby Polley Lake and rivers in the watershed.
The mine isn’t closing for good, according to the announcement, and that operations will resume “once the economics of mining at Mount Polley improve.” The announcement also stated that the company will continue its economic monitoring and mitigation efforts.
Imperial Metals — which also owns the Red Chris and Huckleberry mines and half owns the Ruddock Creek Mine, all in B.C. — has had well publicized financial issues lately, as detailed in a September report from the Empire. Through the end of September 2018, the company reported a net loss of more than $61 million in U.S. currency ($81 million Canadian) during 2018.
The company also reported debt of $658.5 million U.S. ($873.8 million Canadian), according to its third-quarter report for 2018. According to a December 2018 report from Reuters, Imperial Metals’ stock has fallen for five consecutive years and the stock was down 63 percent in 2018 alone.
Looking for stronger regulations
The company’s overall financial status has Alaska conservationists and even one of the state’s U.S. senators concerned.
Jill Weitz, the director of environmental advocacy group Salmon Beyond Borders, cautioned that outdated B.C. mining regulations could allow for a mining company to declare bankruptcy and walk away without being responsible for cleaning up the mining materials left behind.
“We hope that that’s not the case,” Weitz said. “We hope that they’ll be held to ensuring proper mitigation and closure of the site. Again, that stuff doesn’t exist in (British Columbia’s) regulatory framework at this time.”
Over the years, many have pointed out problems with the province’s regulations. Canadian economist Robyn Allan wrote in a 2017 report to the Alaska Legislature that the “dysfunctional” environmental assessment and monitoring system in B.C. “places the environment and the public on both sides of the Canadian and U.S. borders at serious long-term risk.”
Imperial Metals’ financial situation could threaten the operations of the Red Chris Mine as well, which sits in the Stikine River’s watershed. The Stikine River supports an average annual run of about 40,000 adult Chinook salmon, according to the Empire’s report in September.
“It’s all about getting stronger regulations back into law and the provincial government actually enforcing those regulations,” Weitz said. “For the last 100 years, the mining industry has basically run the show and it’s time to change that.”
U.S. Sen. Dan Sullivan, R-Alaska, has a long history of being vocal on transboundary mining issues. As a former commissioner of the Alaska Department of Natural Resources and now a sitting senator, he’s worked for years on trying to find a balance between the economic opportunities mining presents and the environmental challenges mining brings.
In a statement to the Empire, Sullivan said the closure of the Mount Polley Mine underscores why the two federal governments must work together.
“This announcement is another reminder of the vital importance of the efforts by the Alaska delegation, along with the U.S. Department of State, to engage with the government of Canada and British Columbia (B.C.) to push for binding protections, joint water quality monitoring and durable financial assurances related to B.C. mining,” Sullivan said in a statement to the Empire. “These action are critical to protecting our communities, watersheds, and world-class fisheries in Southeast.”
Examining the industry itself
Guy Archibald, the staff scientist for the Southeast Alaska Conservation Council (SEACC), said in a recent interview that Imperial Metals’ situation could serve as a cautionary tale for mines everywhere. First of all, he said, it’s extremely difficult for a mine to rebound from a disaster on the scale of the Mount Polley Mine’s dam break, which sent almost 24 million cubic metres of waste into its watershed. The mine did not resume full operations for nearly two years.
Secondly, he said, with mines so dependent on factors outside of their control — copper prices, for example — he believes it’s hard to depend on mining for steady economic impact.
“I think that shows that not only are metal prices very volatile, and that also means jobs associated with mines are very volatile,” Archibald said.
Mike Satre, the manager of government and community relations for the Greens Creek Mine in Juneau, said via email that it’s impossible to compare the Mount Polley Mine’s situation to those in Southeast. He acknowledged that markets can be volatile, but a well run company can survive the low points and continue to adapt.
“These conditions rise and fall due to factors beyond an operator’s control and it doesn’t matter if you are a miner, logger or fisherman, you have to be prepared for lean economic times,” Satre said in an email. “Innovation and efficiency are key to long-term survival in all industries and at Greens Creek we believe we are well situated to responsibly operate for many years to come.”
The mining sector is one of a few industries in Southeast that is experiencing economic growth, according to research firm Rain Coast Data. In its annual Southeast by the Numbers report (done for Southeast Conference), Rain Coast Data reported that mining jobs increased by 11 percent in 2017 and the mining sector is expected to continue to see modest growth.
Less than half of mining employees in Southeast actually live in Southeast, though, according to Rain Coast Data’s report. Just 47 percent of mine employees are Southeast residents, according to the Alaska Department of Labor (which defines residency as being eligible for a Permanent Fund Dividend).
Jan Trigg, public relations and IT manager for Coeur Alaska, explained that many of their departments operate on a two week on/two week off schedule, which sometimes results in people living elsewhere. Trigg said they try to hire local, and that 64 percent of their employees currently live in Alaska. Satre said 65 percent of Greens Creek’s employees live in Alaska.
• Contact reporter Alex McCarthy at 523-2271 or email@example.com. Follow him on Twitter at @akmccarthy.