Corps suspends Rock Creek permit

NovaGold Resources took on Barrick, the world's largest gold producer, and won, but equally tenacious opposition from some residents of Nome has cast a shadow over the Vancouver-based junior's first mine construction project. Just after Barrick withdrew from its hostile takeover bid with just 14.8 percent of NovaGold's shares tendered, the U.S. Army Corps of Engineers announced that it was suspending its 404 permit for Rock Creek mine in the wake of a lawsuit. The permit authorized the placement of approximately 13.7 million cubic yards of fill material in 414.5 acres of wetlands.

The Corps of Engineers took exactly the same action in November 2005 with regard to Kensington gold mine near Juneau, suspending the project's 404 permit in response to a lawsuit by environmental groups and reinstating it a few months later after conducting a review. Little was changed in that permit, but during the suspension period no work could be conducted on the mine's tailings facility. The lawsuit has now reached the 9th Circuit Court of Appeals.

The Kensington issue relates specifically to mining company Coeur Alaska's plans to dispose of tailings in a lake.

Lawsuit by individuals

The lawsuit against the Corps' dredge and fill permit for Rock Creek is motivated by a much wider variety of concerns, and it has been initiated by three individuals rather than a coalition of environmental organizations, as in the Kensington case. The three are Austin Ahmasuk, an Alaska Native subsistence advocate, Sue Steinacher, an employee of the state's Department of Fish and Game, and Jana Varrati, a nine-year Nome resident.

Ahmasuk, Steinacher and Varrati all say that they are hardly aware of controversies over other mining projects in the state such as Kensington and Pebble, and that they are disappointed with what they saw as the Frank Murkowski administration's rush to permit Rock Creek. They want an environmental impact statement to be produced for Rock Creek so that the public has sufficient time to consider the project. NovaGold and state agencies argue that Rock Creek isn't large enough to merit an EIS.

"We are fully committed to working with the Corps in this matter.

If the Corps' review indicates that the public process was sufficient, which NovaGold believes to be the case, the permit can be reissued with only minor disruption to the project's timetable," said Rick Van Nieuwenhuyse, NovaGold's president and CEO. "NovaGold is committed to building a showcase mine that will operate with the utmost respect for the environment and the community of Nome.

We believe the process undertaken by the Corps and NovaGold to obtain permits for Rock Creek complied with applicable laws and followed all procedures.

We believe the permit will be reinstated once the Corps has completed its review process," he added.

Work continues at plant site

NovaGold's subsidiary in Nome, Alaska Gold, is continuing to work on the plant site and will pour foundations for the shop and mill buildings upon receipt of the air quality permit, expected soon. The company has prepared the plant site for construction of the mill facilities and has cleared a significant portion of the wetlands in the areas of the tailings facility and waste dump areas, as part of normal construction activities, NovaGold said in a release Dec. 7.

In late August, before filing the lawsuit, Austin Ahmasuk appealed the state's decision to approve the reclamation plan for Rock Creek and the Big Hurrah satellite deposit, 44 miles away. The commissioner of the Department of Natural Resources at the time, Michael Menge, responded with a denial of the appeal Oct. 5, determining that the Division of Mining, Land and Water considered the issues raised by Ahmasuk during the permitting process and appropriately addressed them.

Alaska Gold is required to salvage and stockpile soils from lands disturbed by mining, Menge informed Ahmasuk.

The company will use this soil for reclamation to help revegetation upon mine closure, he added.

"I do not view solifluction to be a significant issue because the mine dumps are made up of coarse material that is not likely to retain water and be subject to slumping and creep, especially because the underlying soils will be removed before placement," Menge wrote.

"These dumps are to be recontoured to gentler slopes that will reduce erosion and aid in revegetation at closure." Solifluction is the slow, viscous downslope flow of waterlogged soil and other material that acts as a barrier to water percolation.

Menge: acid drainage issues carefully studied

Acid rock drainage issues at Rock Creek have been very carefully studied, Menge said.

"DNR hired a first-rate consultant to assist the department with its review of the company's data and the department required a good deal of additional testing and evaluation," he wrote to Ahmasuk. "The requirement for the acid-generating rock to be backfilled into the Big Hurrah pit and held under water is an almost unprecedented conservative approach."

In addition, DNR did not accept NovaGold's calculation of the amount required for the reclamation bond, but constructed its own independent calculation, Menge said. "The bond amount fairly represents the reclamation, closure, and long-term monitoring costs and DNR will update it annually," he wrote.

Ahmasuk had argued in his appeal that the bond amount of $6,844,700 was inadequate.

Ahmasuk worked for Kennecott Exploration in the Rock Creek area for seven years, he told Mining News, and he describes himself as a "closet scientist," although with no formal scientific qualifications. Nevertheless, he asked numerous detailed scientific questions in his appeal and received an 18-page response to them from DNR, which was enclosed with Menge's letter.

"You can dive into geochemistry, water quality and hydrology like I did," Ahmasuk said. "I'm the type of person who doesn't just sit back and rely on people to do things for me. I have a really strong concern. I have lived here all my life. I'm not an outside, outsourced environmental person."

Even if the waste rock from the mine isn't acid generating, that doesn't mean it's non-polluting, Ahmasuk said. He is worried that levels of arsenic and antimony may exceed those allowed by the Environmental Protection Agency if the project goes ahead as planned, and that Alaska Gold doesn't recognize that this could be a problem that would impact aquatic life in the area. Bering Straits Native Corp., which owns much of the land where Rock Creek is situated, also hasn't made enough effort to review the project, Ahmasuk added.

Cyanide major concern for Varrati

Ahmasuk deliberately steers clear of the issue of cyanide use in his comments about the mine because he thinks that cyanide chemistry is too complicated to assess. But cyanide is a major concern for another participant in the lawsuit, Jana Varrati, who is dismayed that NovaGold plans to ship 500 tons of the toxic chemical to Nome for each year of mine operations. The Snake River valley, where Rock Creek is located, is "pristine," according to Varrati. "Dogsledders use it, people use it summer and winter," she told Mining News. "I don't think there's anybody in Nome who objects to mining: you don't belong here if you think that. We just don't want to be poisoned."

The late surge of opposition to Rock Creek caught NovaGold by surprise; the company had thought the city of about 3,600 was mining-friendly and that it had done enough to explain its plans to the community, including publishing a regular column about mining, The Bucketline, in the local newspaper, The Nome Nugget.

Thousands of people poured into Nome in 1900, seeking gold on the beaches, and all Nome residents are aware of the city's mining history. But Varrati and Sue Steinacher, the other participant in the lawsuit, think the newspaper column wasn't effective because it looked like company publicity.

The Nome Nugget is now dedicating large amounts of space in every issue to the Rock Creek project, including an article Oct. 12 that reported on a visit by scientist and campaigner David Chambers from the Center for Science and Public Participation in Montana. Chambers' publications and presentations mainly draw attention to the negative side of mining. He told Nome residents that an EIS should have been done for Rock Creek, according to the Nugget.

The three people who brought the lawsuit each have their own reasons for doing so, Sue Steinacher told Mining News. "My own reason is that I just don't feel we have had a legitimate public process, enough information, enough time," she said. "The more we learned, the more we saw that there were potential significant impacts. We are entitled to a full environmental process."