Mr. Gillam goes to Juneau

Most Alaskans have never heard of Robert B. Gillam, the self-made Anchorage money man who built from scratch an investment empire approaching $10 billion in financial assets under management.

But Gillam recently emerged as a central figure in the ongoing fight to stop development of the mammoth Pebble copper-gold deposit near Iliamna in southwest Alaska. He testified in favor of House Concurrent Resolution 29 at a hearing Feb. 10 before the Alaska House Committee on Natural Resources in Juneau. HCR 29 is a resolution that would add a new layer of regulatory oversight to the state process for evaluating development of the proposed Pebble project.

Gillam came to Juneau to exercise his basic "free speech" rights as a U.S. citizen, says his lawyer, Geoffrey Parker.

Still, it's not every day that a reported billionaire visits the Alaska Legislature. Gillam, who was born in Fairbanks, made it clear that he is no opponent of Alaska resource development, or other well-known Alaska mine projects. But the Pebble mining proposal developed by junior mining company Northern Dynasty Ltd. sticks in his craw.

Why? Because the open pit mine process Northern Dynasty proposes to extract copper and gold from Pebble would contaminate groundwater in the surrounding area and ultimately devastate fish and wildlife in the Bristol Bay drainages, Gillam told state lawmakers.

Protecting his private lodge?

Parker says Gillam is worried that the area around Pebble, a vital red salmon spawning and rainbow trout habitat would be destroyed by the proposed mine development.

"Bob Gillam knows that Pebble is the wrong mine for this area," he says.

To back up his claims, Gillam cites the impact of open pit copper mining in the Lower 48, especially places like Clark's Fork on the Salmon River in Montana, the largest hazardous waste mining site in North America, Parker says.

Critics question Gillam's motives, suggesting that he is more interested in protecting the source of the trophy trout caught by guests at his huge fishing lodge near Iliamna than in preserving Bristol Bay commercial and subsistence fishing.

They point to a recent article in a financial trade publication as evidence of Gillam's leanings. It recounts events during a fishing trip with clients to Iliamna and quotes Gillam saying, "There are only two things that matter: Getting rich and catching fish."

Others worry that the phenomenally successful money manager, who regularly plays host for U.S. Sen. Ted Stevens, R-Alaska, on trout-fishing excursions to Iliamna, will use his considerable influence in investor circles to adversely affect the perception of Alaska as a good place for resource development.

Gillam declined to be interviewed by Mining News and to answer prepared questions.

Parker, however, says Gillam is on record as an avid supporter of oil development in the Arctic National Wildlife Refuge.

He also says people should focus on the Pebble issue rather than attack Gillam's motives by appealing to existing prejudices.

A premiere Alaskan

So who is Bob Gillam? And how determined is he to stop Pebble?

An advisor to the State of Alaska since 1974, Gillam launched Anchorage-based McKinley Capital Management Inc. in 1990 using computer models to invest in stock markets. Not only does he employ nearly 100 Alaskans in his firm, Gillam also manages securities for all Alaskans. McKinley Capital Management is one of about 26 asset managers charged with growing the $33 billion Alaska Permanent Fund.

Rep. Jay Ramras, R-Fairbanks, says Gillam "is a very decent man" who had done great things for Alaska and the state's economy.

"He manages more funds than all the banks in Alaska combined, just at $10 billion," says Ramras, who co-chairs the House Resources Committee. "He's a nerdy, Bill Gates-type. He's super-wealthy, super-smart and used to having things his own way, and he's run into a public process that is creating a problem with him having things his own way."

Gillam is making a name for himself as someone who will use his financial muscle to block Alaska officials when he believes they take a wrong turn with resource development. For example, he and others recently sued the state Division of Forestry to block a timber sale in the Petersville-Trapper Creek area of the Matanuska-Susitna Borough.

Gillam owns property near Trapper Creek and is an avid outdoorsman who enjoys snow machining and hunting in the area. But Parker says the money manager believes the proposed timber sale is bad public policy. Gillam is convinced the state will lose money on the venture, and that cutting nearly 1,300 acres of mature trees across 30 square miles to make wood chips for sale in Korea does not warrant the resulting impact on the environment, Parker says.

In Juneau, at least one state lawmaker shares Gillam's concern about the effects of mining on the Bristol Bay region. But Rep. Gabrielle LeDoux, R-Kodiak, says she believes in the state's current environmental impact statement process.

"(Gillam) uses that area, and he has a right to his opinion. It's not that I am utterly sanguine about mining there. It's a really, really beautiful area. If anything is done, it has to be done right," says LeDoux, who also is a House Resources Committee member.

"I don't believe projects ought to be singled out. There are a lot of big projects in Alaska, and I don't think we need one rule for some projects and another rule for others. Let DNR do its job," she continues.

But Gillam questions whether the Alaska Department of Natural Resources do the right thing at Pebble without special intervention, says Parker.

Fight goes to court

The attorney has filed at least three lawsuits on behalf of Gillam and others to block construction of a road and bridge project that would connect the village of Nondalton to Iliamna across the Newhalen River.

One suit, filed in 2004, charges the Alaska Department of Transportation and Public Facilities with discrimination in pursuing the construction project. It is currently on appeal with the Ninth Circuit Court of Appeals.

Another, which challenged DOTPF in a 137-count complaint in 2002, is currently in legal limbo after the state agency made corrections to its planning process in response to the one count that eventually was found to be valid, says Assistant Attorney General Susan Urig. An earlier effort by Gillam to block the bridge was settled out of court in 1997.

The third suit, filed in 2005, is currently pending. It challenges the Federal Highway Administration's compliance with the National Environmental Policy Act. Federal money will partly fund the bridge project.

Jeff Ottesen, a DOTPF planning specialist, who works on the Nondalton road-bridge project, questions the assertion that opposition to the bridge is related to Pebble. He says the single-lane bridge is designed for light traffic and could not withstand the industrial loads needed by Pebble.

But Parker says DOTPF planners mentioned possible development of a mine at Pebble as a reason for building the bridge in an internal memo in 1992. That memo set off alarms for Gillam and Trout Unlimited, the other plaintiff in the lawsuits.

Though he hasn't seen it, Ottesen said he wouldn't be surprised if the memo exists. But Pebble is not a basis for DOTPF's current plan, he says. Ottesen, however, has a letter on file from Northern Dynasty saying mine developers cannot use the proposed 700-feet-long, 150-feet-high bridge.

"The plaintiffs view this as prime wilderness country, and they don't want to see a bridge in it," he says.

"I believe they want to protect this region for trophy trout fishing," Ottesen continues. "They say they don't want (the bridge), and they don't want to see it. They are doing a really good job of using the fog of federal and state law to make hazy what is generally considered standard practice. … They've got a talented attorney who has found this fog and uses it to his advantage," Ottesen adds.

A good neighbor

Meanwhile, the Village of Nondalton does not have a paved road and bridge link to the modern airport in Iliamna, a situation that state officials say is life-threatening.

"Two young men died last year crossing the river on snow machines when the ice gave way. There have been a lot of close calls, and there is a lot of fear in the community." Ottesen says.

However, Jack Hobson, president of the Nondalton Tribal Council, says the bridge would be a good idea but the design is the focal point. "I've seen the DOT letter that mentions the Pebble mine as a reason for the bridge," he says. "We don't want the mine because it could have a devastating effect on the environment and our subsistence lifestyle. It would be a different story if they would guarantee us that the mine won't hurt subsistence, but they can't do that."

As to recent river deaths, Hobson says a bridge would not have prevented them.

Gillam, meanwhile, is far from indifferent to his neighbors in Nondalton. Hobson says the lodge owner supplied fuel for the village twice in emergencies and sent about 70 turkeys to village residents at Thanksgiving and Christmas.

Adds Parker" "At the end of the day, I believe Bob Gillam will be credited with saving the Bristol Bay drainages."