Northern Dynasty meets 2004 Pebble timeline

After a busy summer, Northern Dynasty Minerals Ltd. is on schedule and optimistic it can meet its timeline for a 2009 commencement of mining operations at its Pebble deposit, a proposed open pit, gold-copper-molybdenum-silver mine near Iliamna in southwestern Alaska, according to Bruce Jenkins, Northern Dynasty director of corporate affairs.

The company completed intensive infill drilling in 2004, sufficient to move the project to the bankable feasibility study level, Jenkins told an audience Nov. 4 at the Alaska Miners Association 2004 annual convention at the Sheraton Anchorage Hotel.

The current timeline calls for mine construction to start in 2007 and for mine operation to begin in 2009. The company plans to deliver the bankable feasibility study, and to begin permit applications in mid-2005.

In addition to drilling, the company moved aggressively in 2004 to fulfill its commitments to the state, affected communities and to its investors, Jenkins said. During the year, Northern Dynasty added a new Anchorage office and staff, made significant mine planning and engineering progress, initiated comprehensive environmental studies, and received formal approval to list its common shares on the American Stock Exchange. Effective Nov. 4, the company's shares were to be listed for trading on AMEX under the symbol NAK. Another high point for the company in 2004 was the completion of a preliminary assessment, which demonstrates robust economics for the Pebble project, Jenkins said.

Superlative characteristics

Jenkins presented tables that underscore the superlative characteristics of the Pebble deposit. According to a Metal Economics Group, December 2003 ranking, Pebble is the fifth largest accumulation of copper-gold porphyries worldwide, and it is the largest in the United States. With 26.5 million ounces, Pebble is one of North America's largest gold deposits when ranked by contained gold in resources. Pebble is the number two copper deposit in North America when ranked by contained copper in resources. It is Alaska's largest copper deposit.

The company continues to weigh three different mine development concepts, all of which include a three-stage mining pit that will reach 1,800 meters in length, 1,200 meters in width, and 250 meters in depth. The first stage of mining is expected to recover 5.1 million ounces of gold and 3.3 million pounds of copper.

Superlative challenges

The Pebble project faces superlative challenges as well. There is no road into the project area, 65 miles from ice-free tidewater in Cook Inlet. The Alaska Department of Transportation and Public Facilities has commissioned pre-feasibility level engineering studies for a transportation corridor and a proposed port on the southwest corner of Iniskin Bay, according to Northern Dynasty. Results of the study are expected in early 2005.

Perhaps the most interesting challenge facing Northern Dynasty is where to find the estimated 150 megawatts to 200 megawatts of electricity it will take to power the mill that processes ore. The best way to deliver that kind of power to the remote Iliamna area is still under study. Northern Dynasty put out a request for proposals for power earlier in the year and it is expecting to receive responses soon - responses the company hopes will contain a viable solution to its power needs.

Power source undetermined

The company isn't fixated on any specific power delivery proposal at this point.

"Power requirements are likely to be met via a connection to the Alaska transmission grid or an independent power producer's generator located near to the project area," the company said in a Nov. 16 statement.

Preliminary studies completed by the project's previous owner proposed that power requirements could be met by natural gas from currently producing offshore wells in Cook Inlet or from thermal coal resources located within the state.

On the other hand, hooking up to the existing Railbelt power grid would require a submarine cable crossing Cook Inlet, or an overland transmission line following the west shore of Cook Inlet to the Chugach Electric Beluga power station.

The ultimate solution will require no less than a comprehensive power plan for the entire region. The company said earlier this year that a working group was convened by Gov. Frank Murkowski to evaluate the demand for, and the benefits of, a regional energy system - including the need for and location of fuel supplies, power stations and transmission lines.