Kensington working around injunction

Alaska legislators didn't get much of a break this summer. After sitting through two special sessions in Juneau to debate a new oil tax and a proposed gas pipeline, followed by some hard-fought primary elections, members of the House and Senate Resources Committee convened again Aug. 31 for a hearing about Kensington mine. Several legislators participated in the Anchorage meeting by telephone, keen to find out what was going on after the Ninth Circuit U.S. Court of Appeals issued an injunction in late August against work on the tailings dam at Kensington.

Idaho-based Coeur d'Alene's Kensington gold mine near Juneau is already under construction, but a coalition of environmentalists has been pushing a lawsuit against the U.S. Army Corps of Engineers and the U.S. Forest Service over the decision to permit the disposal of tailings in Lower Slate Lake. A U.S. District Court judge dismissed that lawsuit at the beginning of August, so the plaintiffs took it to the Court of Appeals. A two-judge motions panel issued the injunction pending the court's review of the case.

Murkowski 'outraged'

The State of Alaska had previously intervened in the lawsuit in support of the mine. Gov. Frank Murkowski described himself as "outraged" by the injunction against Kensington.

"The community of Juneau stands behind this project as an environmentally responsible economic development," Murkowski said. "There are better ways than court action to resolve differences of opinion. Stopping the project through an injunction will have a devastating impact on the Goldbelt Native Corporation, on Juneau and on Alaska."

Democratic gubernatorial candidate Tony Knowles also urged the environmentalists to drop their appeal. "The Kensington mine is critical to Juneau's economic future," Knowles said. "It's an environmentally responsible project that should go forward. The state should have been leading the effort to clear the hurdles and resolve the differences among Alaskans. It doesn't need to get mired in court."

Knowles will run against Republican candidate Sarah Palin in November. Palin, who defeated Murkowski in the primary, has expressed support for Kensington, as have U.S. Sens. Ted Stevens and Lisa Murkowski and Congressman Don Young.

Coeur has redesigned mine

Coeur Alaska has been trying to build Kensington since 1990 and first received permits in 1998, but it decided to redesign the mine and reapply for the permits.

"We have looked at this thing left, right, up, down, sideways, inside out," Michael Menge, the commissioner for the Alaska Department of Natural Resources, said at the legislative hearing. "We have the most rigorous permitting program in the nation. ... The chances of there being a problem are reduced to the infinitesimal."

The reclamation bond for Kensington is about $7.3 million, DNR Deputy Commissioner Ed Fogels told legislators. Like most reclamation bonds for mines, it is a letter of credit from a bank that will cover the cost of reclamation in the event that Coeur Alaska gets into financial difficulties. Cyanide will not be used in the flotation process at Kensington and the tailings at the bottom of the lake should be very benign, Fogels said, but if necessary they will be capped with organic material at the end of the mine life to form a habitat for plants and wildlife.

"It'd be very difficult to build a mine in Alaska without putting tailings in wetlands," Fogels said. "If you follow the reasoning of this lawsuit then you could reach the conclusion that you shouldn't be putting tailings into wetlands, period."

Under the Clean Water Act wetlands are defined very broadly, ranging from lakes and streams to bogs and swamps - any form of surface water. The State of Alaska wants to be able to take decisions on a project-by-project basis, depending on how reactive or benign the tailings are and what their impacts would be, Fogels said.

Economic value of clean water overlooked

The environmentalists are led by the Southeast Alaska Conservation Council, a coalition of 17 conservation groups in the region.

"In 1972, when President Nixon signed the Clean Water Act into law, the American people committed to stopping the disposal of industrial waste into America's waters and to clean up those waters that had been damaged by bad practices," SEACC's executive director, Russell Heath, told legislators. The economic value of clean water is often overlooked, and in Alaska clean water supports thousands of jobs, he said.

SEACC is not attempting to stop Kensington from being built, according to Heath. The coalition wants the mine to use a dry-stack tailings facility like Greens Creek and Pogo mines.

"We believe that mining can continue in Alaska if we tighten up and really do a realistic definition of fill," Heath said. "Tailings are not fill, chemically processed waste from a mine."

Since undergoing a rewrite in 2002, the federal definition of fill is any material that changes the bottom elevation of a water body. Kensington will be the first mine to dispose of its tailings in a natural water body since the Clean Water Act was signed, Heath pointed out.

"So, basically, in your mind, this isn't as much about pollution as it is about precedent?" Sen. Thomas Wagoner, R-Kenai, chair of the Resources Committee, asked.

"It's about both," Heath replied.

Wagoner told Heath that he had visited the mine site recently.

"We're talking about clean water, and I saw two of the largest glacial streams pouring thousands of tons of silt into the saltwater per day, and then I saw the stream that goes into the Lower Slate Creek and saw the water quality and how these people are handling the water quality," Wagoner said.

"I think your fears are totally unfounded because it looks to me like the corporation has done a very fine job in complying with the permitting process and working on the mine, and I think we're sending out a terrible message nationwide to mining companies ...

because of your organization and what you've done there," he continued.

Coeur Alaska's general manager, Tim Arnold, read a prepared statement and said he couldn't answer questions about the tailings facility because of the pending litigation.

"From stem to stern the permitted Kensington gold mine has the best environmental design of any project that I've ever been associated with," Arnold said. "It's blessed with natural attributes that make it unique in mining and designed utilizing attributes especially appropriate to Southeast Alaska."