Forest Service approves 10-year extension for Southeast gold mine

Wed, 03/02/2022

Coeur Alaska Inc. now has federal clearance to increase throughput and extend the life of its Kensington gold mine in Southeast Alaska.

U.S. Forest Service Tongass Supervisor M. Earl Stewart on Feb. 24 signed a record of decision approving Coeur’s plan to increase the processing capacity by 50% and nearly double the waste storage capacity at the underground gold mine.

The corresponding 10-year extension to the life of Kensington will allow the mine to operate into 2033. Coeur applied for the environmental permits to grow operations at Kensington in 2018.

Coeur’s initial development plan provided for mining at Kensington, which opened in 2010, into 2023.

Chicago-based Coeur’s expansion plan involves raising the height of the tailings dam by 36 feet to 124 feet and constructing another 40-foot “back dam” between the treatment facility and Upper Slate Lake, a natural lake. The record of decision, or ROD, allows Coeur to expand the mine’s existing Pit No. 4 and Comet waste rock storage facilities as well as construct a new waste rock facility for a total storage capacity increase of 6 million tons.

The expansion project would result in the loss of approximately 52 acres of wetlands through water inundation or fill; however, Coeur’s reclamation plan calls for a net increase in wetlands in the area once the mine is closed, according to the Forest Service.

The work would also require 1.75 miles of new roads.

Kensington has a current footprint of about 240 acres and the expansion work will add another 150 acres to that.

Located about 45 miles north of Juneau on the edge of Lynn Canal, Kensington employs approximately 390 people during normal operations.

Coeur also plans to increase the milling capacity at Kensington from about 2,000 tons to 3,000 tons of ore per day as part of the expansion.

According to a statement from the company, the work will require about 65 additional workers over approximately two years.

Coeur spokeswoman Donna Sabido wrote in an email that the authorization is very positive news and will allow the company to continue providing high-paying jobs and contributing to the Southeast economy.

“We are appreciative of all the engaged parties who participated in the process and helped to develop a strong, science-based environmental analysis and decision,” Sabido wrote.

She added that the expanded waste rock and tailings facilities will give Coeur capacity beyond the current life of the mine, so the company continues to invest in further exploration at Kensington.

Local environmental groups previously urged Forest Service officials to require dry-stack storage of the mine’s tailings, a strategy often employed to reduce the risk of large-scale spills or smaller leaks of tailings slurry. The ROD states that Coeur developed a plan to reduce the volume of water that will need to be stored after mine closure in response to those concerns.

The company is also proposing to improve Dolly Varden habitat by constructing new stream channels and small stream deltas, along with replacing three culverts to facilitate fish passage.

The impact mitigation plan for the work further requires Coeur to develop fish passage and take other measures to restore Lower Slate Lake — currently Kensington’s tailings treatment facility — to viable fish habitat.

The Southeast Alaska Fishermen’s Alliance previously backed the project, stating in comments to the Forest Service that mining is an important part of the region’s economy and Kensington has not negatively impacted salmon habitat.

Kensington produced approximately 122,000 ounces of gold last year when Coeur had a capital budget of approximately $27 million at the mine. This year Coeur expects to produce about 113,000 ounces from Kensington, according to a February investor presentation.

Kensington held 261,000 ounces of proven and probable gold reserves and nearly 1 million ounces of measured and indicated gold resources last year, according to Coeur.

The original article can be found on the Alaskan journal of commerce website