Alaskans in Kamchatka admire Aginskoye mine

KoryakGeoldobycha's reputation depends on making a success of Aginskoye mine. Bystrinsky Mining Co., headed by the ebullient Andrei Kozlov, is firing on all cylinders to achieve the first gold pour at the mine by the end of the year. KGD has built a 127-kilometer road northwest from the village of Milkovo to the mine. The contractors who are working at the mine live in the old Soviet exploration camp, but brand new, comfortable housing has been built on site and the old camp will be demolished. It was hoped that the mine would be operating by the time of the AMA visit, but construction of the mill is still under way. The capital cost of the mine is US$53 million.

Aginskoye deposit high grade

The Aginskoye deposit is relatively small, but high-grade, containing proven reserves of 1 million metric tons of ore at an average grade of 38 grams of gold per ton (1 troy ounce equals 31.1 grams). Annual production will be three tons of gold per year, from approximately 100,000 tons of ore. Mine facilities are being built to last longer than the projected 10-year life of the deposit, as there are several other deposits in the area that could also be mined. Mine managers expect to recover around 90 to 92 percent of the gold and 70 percent of the silver in the ore.

In the tunnels, which are reinforced with metal arches and timber, ore cars will run on rails. This is common at Russian mines, and also means that the tunnels will not have to be widened to accommodate vehicles with tires. The absence of exhaust fumes will also satisfy environmentalists' demands.

There is already a 15,000-ton ore dump at Aginskoye waiting to be processed in the mill. The ore will be crushed and then go through a carbon-in-pulp process, in which cyanide leaching occurs in tanks and the slurry is mixed with carbon. The cyanide will come by sea from Korea to the port of Petropavlovsk-Kamchatsky, the region's capital city. The gold and silver will be poured into doré bars in one of the mine buildings and sent to a refinery in another part of Russia, most likely Yekaterinburg.

Environmental approvals took time

It took a long time for Bystrinsky Mining Co. to obtain all its environmental approvals, and a great deal of attention is being paid to the detoxification of industrial waste, the AMA group was told. Tailings will be filtered and solutions containing a heavy concentration of cyanide will go back through the process. The tailings will be detoxified with hypochlorite, followed by a second stage of filtration. They will be trucked to the dry stack tailings facility, 2 kilometers from the mill, which has a capacity of 1 million cubic meters. Precipitation falling on the tailings will accumulate in a settlement pond and will be recycled through the mill.

Diesel generators, manufactured in the United States by Caterpillar, will provide 6 megawatts of power to the mine. Caterpillar dozers and trucks will also be used at the mine. The average temperature here in winter is between minus 20 and minus 25 degrees Celsius and the temperature in the tunnels is expected to be around 5 degrees C. The road to the mine, which is currently being widened, is owned by the Kamchatka regional government and can be used for fighting forest fires in summer.

The AMA group had a chance to appreciate the varied aspects of the Kamchatka region when they spotted a grizzly bear sow and cub by the side of the main road to Milkovo, photographed steam rising from volcanoes and visited a salmon hatchery, a mineral water bottling plant, a hot springs resort and the Mutnovsky geothermal power station in the mountains above Petropavlovsk-Kamchatsky. During a rest stop we sampled naturally carbonated mineral water from a stream. It is no surprise, then, that tourism is becoming an increasingly important sector of Kamchatka's economy, including both ecotourism and hunting.

Anadromous fish resources important environmental issue

"Like Alaska, Kamchatka contains important salmon and other fisheries, and probably the most important issue environmentally is the anadromous fish resources," Bundtzen said. The area around Aginskoye is quite similar to Interior Alaska, where the Pogo underground gold mine is being built and the Fort Knox open pit gold mine is in operation near Fairbanks. Aginskoye's environmental controls are complicated and expensive, according to mine managers, but they are necessary because of the region's sensitive ecology.

Employees will fly into Aginskoye on charter planes from all over the Far East, including Magadan, Khabarovsk and Vladivostok, with a total of 250 people working at the mine at any one time. It won't be easy to find trained personnel in Kamchatka because there have never been any operating hard rock mines in the region. Many of KGD's managers are originally from Ukraine, whose schools traditionally provided mining engineers for the Soviet Union. The work schedule at Aginskoye may be one month at the mine and one month at home, or two-on-two - no decision about this has been taken yet.

"Aginskoye is a very impressive ore body because of its grade," said Julian Misiewicz, exploration manager for South Africa-based major Gold Fields' Europe and Central Asia region, who joined AMA members on the trip to Kamchatka.

"They're introducing new ideas - the tailings management seems to be a new way of doing things.

They're trying to extract all the liquid out of the tailings before moving them, going the extra mile to be as efficient as they can." Gold Fields has no properties in the former Soviet Union yet, but last year Russian mining giant Norilsk Nickel acquired a 20 percent stake in the company.

"We have a very strong potential partner in this part of the world, but we haven't taken advantage of that partnership yet," Misiewicz added.

Borell: project going ahead after attacks

"The really exciting thing for me was to see that project going forward after the incredible level of attack it withstood," AMA Executive Director Steve Borell said of Aginskoye. "The dry stack tailings facility is as good as I've seen anywhere. There's a bypass under the dam, a really neat concept. I'd heard of that, but I hadn't seen one before. The camp facilities are as nice as you'd find anywhere, in any remote camp. The original exploration will cause them some additional challenges. They were driving on the ore zone, which is less competent than the wall rock."

Borell believes he may have recruited at least two young men from Kamchatka to study mining engineering at the University of Alaska Fairbanks. Whether they remain in the United States or return to Russia afterwards, they will be sorely needed. Local contractors at Aginskoye may not be working as effectively as they should be due to the lack of experience and skills in the region. The United States also requires mining engineers because a generation was lost when metals prices plunged, Borell said.