The Pebble Partnership - an equally-owned joint venture formed between Northern Dynasty Ltd. and Anglo American plc to advance the exploration and development of a colossal copper-gold-molybdenum deposit in Southwest Alaska - has approved a budget of US$91 million for 2011, a 25 percent increase over the US$72.9 million spent at the project in 2010. This extensive program will largely center on the ongoing environmental studies and the engineering work needed to complete a prefeasibility study for the colossal porphyry ore-body.

"One of our main focuses for this year is to conclude a process we call our prefeasibility study - that is really to define the development plan for Pebble," Mike Heatwole, Pebble Partnership vice president of public affairs, explained to members of the Anchorage Chamber of Commerce during a May 2 luncheon.

The prefeasibility study is expected to be concluded early in 2012. Indications are the project could enter the permitting gauntlet later that year, but the Pebble Partnership is not committing to a timeline to complete the precise work expected.

"Given its national and global importance, the Pebble Partnership has been very deliberate, methodical and patient in designing a project that will meet and exceed the exacting environmental regulations and permitting requirements in Alaska, while delivering superior returns for shareholders. I'm pleased to report that this project design process is nearing important milestones and that PLP (Pebble Limited Partnership) intends to enter the permitting phase towards the end of 2012," said Northern Dynasty President and CEO Ron Thiessen.

"We are not trying to set hard dates on when prefeasibility is going to be concluded. We need to take our time to make sure that we do it all to our satisfaction," Heatwole explained to Mining News during a May 13 interview.

Engineers blueprint mine

Much of the 2011 program will be concentrated on putting the finishing touches on a mine plan the Pebble Partnership can demonstrate to stakeholders for their input before entering permitting.

Though an official blueprint for Pebble is not expected to be released until engineers incorporate the information from this year's field work, a preliminary economic assessment released by junior partner Northern Dynasty in February provides a sense of the potential scale of the project.

According to the PEA - which is not endorsed by the Pebble Partnership - a 220,000-metric-ton-per-day-mill would produce 31 billion pounds of copper, 30 million ounces of gold, 1.4 billion pounds of molybdenum, 140 million ounces silver, 1.2 million kilograms (2.6 million pounds) of rhenium and 907,000 ounces of palladium, over 45 years, while mining only 32 percent of the total Pebble mineral resource.

"Upon reaching commercial production, Pebble would become one of the world's leading producers of copper, gold and molybdenum as well as a tremendous driver of economic wealth and opportunity in Alaska and the United States," Thiessen said.

In addition to designing a global-scale mine that will be expected to meet the highest environmental standards, Pebble Partnership engineers are also tasked with blueprinting extensive infrastructure to support the operation in a remote region of Southwest Alaska.

Currently the Pebble property can only be accessed by helicopter, and if the project is developed, an 82-mile, or 132-kilometer, road linking the mine to Cook Inlet would need to be constructed.

Much of the nearly 14,000 meters of drilling slated for 2011 will be focused along the proposed road corridor and port site.

In addition to geotechnical drilling along the transportation route, the partnership also plans to employ sonic drills to conduct overburden sampling at the Pebble West deposit. This technique, which uses vibratory energy to drive the drill steel, has the advantage of less soil column disruptions.

The most challenging piece of the infrastructure may be supplying the mine's potential energy needs. It is estimated that a mine at Pebble would consume some 600 megawatts of electricity, about the current usage of Anchorage, Alaska's largest city.

Environmental tome

The next major milestone expected to be reached by the partnership will be the completion and release of an environmental baseline document for the project. This massive tome, expected to weigh in at 20,000 pages, will be a compilation of the environmental data collected at Pebble and the surrounding region since 2004.

"Another piece of our work is our environmental studies program. We have been conducting extensive environmental studies of the Pebble deposit since 2004," Heatwole explained.

The environmental baseline document, expected to be completed by late June, specifically characterizes the environment in and around the project area.

For those who don't want to thumb through the 20,000-page version, a 150-page technical summary and 30-some page popular summary also will be available.

The environmental information in the baseline document will be the topic of the ongoing dialogue between Pebble developer and stakeholders of the potential mine in Southwest Alaska.

"The Pebble Partnership has made a public commitment to consult the people of Bristol Bay and Alaska before permitting is initiated as part of the process of developing a proposed mine plan for Pebble.

That important work will begin this year, along with efforts to advance partnership agreements with Alaska Native corporations and other interests for development of key project infrastructure," the Northern Dynasty president and CEO said.

"As we move toward commencement of project permitting, Alaskans and all project stakeholders will get much greater insight into how this project will be built and operated so as to protect fish, water and other important natural resources, while providing significant benefits to Alaskans and the Native people of the region."

Working diligently

Pebble has come under fire from activists who contend that mining the 80 billion pounds of copper, 107 million ounces of gold and 5.6 billion pounds of molybdenum at Pebble poses too great a risk to the Bristol Bay salmon fishery, also located in Southwest Alaska.

At the end of this year's program, Anglo American will have spent US$410 million at Pebble since it joined the project in 2007. In total, the South African major has agreed to spend US$1.5 billion to earn its 50 percent stake in the world class copper deposit.

"The Pebble prospect has tremendous significance globally and, with the potential to bring much-needed jobs to Southwest Alaska, the partnership is working diligently to develop a mine plan that shows how mining at the prospect can successfully co-exist with the fisheries," says Pebble Partnership CEO John Shively.

Due to the controversial nature of the project, the Pebble Partnership, under the leadership of Shively, has been careful not to feed speculation with project scenarios until the feasibility study is complete, at which point a final mine-plan can be presented to and the stakeholders in the Bristol Bay region of Southwest Alaska where the project is located.

"John Shively has made it repeatedly clear that when the Partnership does have a preferred option, he and his team will engage in extensive further consultation in advance of taking any proposal to permitting," Anglo American CEO Cynthia Carroll said during her visit to Alaska in March. "The Pebble Partnership will only publish a detailed plan once that has been properly developed and approved by Pebble's board. The fact is that the Pebble Partnership is still studying multiple options as it works towards completion of a pre-feasibility study in 2012."

Dialogue continues

The Pebble Partnership's public outreach program is designed to update stakeholders in Southwest Alaska and throughout the state on the status of project planning, including environmental safeguards, economic benefits and partnership opportunities.

The Keystone Center - a Colorado-based consultancy firm that specializes in problem solving and advancing good public policy through neutral, independently organized, and well-managed discussions - was engaged by the Pebble Partnership to help facilitate this exchange of ideas with the people who have a stake in the development of Pebble.

Keystone has organized a series of discussions that provide a neutral platform for stakeholders and the general public to learn the facts about the environmental studies undertaken at Pebble; hear about modern mining techniques, efforts and regulations; and provide the opportunity to pose questions to a wide range of scientific experts.

The first of this series of independent science panels designed by the Keystone Center, "Responsible large-scale mining: A global perspective," was held in December. A five-member panel representing academia, non-governmental organizations and an industry corporate social responsibility organization, shared perspectives on what mining companies around the world are and should be doing to balance economic mining with protecting the environment and the people in the regions where minerals are being found.

The discussion held during the day-long event was intended to set the stage for the upcoming science panels that will delve into the extensive baseline environmental, socioeconomic and prefeasibility studies as that information becomes available.

"The trigger for the next phase of the Keystone dialogue is the public release of that environmental baseline document," Heatwole explained.

Considering the expected late June release of the environmental information, the Keystone Dialogue is not anticipated to resume until after the short Alaska summer. The Pebble partnership said meetings during this busy time would not receive the sought-after level of participation, especially from Bristol Bay stakeholders whose livelihoods depend on fishing.

"We just want to be mindful of that," said Heatwole.

Author Bio

Shane Lasley, Publisher

Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.

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