Legislature(2023 - 2024)BUTROVICH 205
03/01/2023 03:30 PM Senate RESOURCES
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| Audio | Topic |
|---|---|
| Start | |
| SB67 | |
| Presentation(s): Mining Industry Update | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 67 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
ALASKA STATE LEGISLATURE
SENATE RESOURCES STANDING COMMITTEE
March 1, 2023
3:32 p.m.
MEMBERS PRESENT
Senator Click Bishop, Co-Chair
Senator Cathy Giessel, Co-Chair
Senator Bill Wielechowski, Vice Chair
Senator Scott Kawasaki
Senator James Kaufman
Senator Forrest Dunbar
Senator Matt Claman
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
SENATE BILL NO. 67
"An Act relating to firefighting substances; and providing for
an effective date."
- HEARD & HELD
PRESENTATION(S): MINING INDUSTRY UPDATE
- HEARD
PREVIOUS COMMITTEE ACTION
BILL: SB 67
SHORT TITLE: PFAS USE FIREFIGHTING
SPONSOR(s): SENATOR(s) KIEHL
02/10/23 (S) READ THE FIRST TIME - REFERRALS
02/10/23 (S) RES, FIN
03/01/23 (S) RES AT 3:30 PM BUTROVICH 205
WITNESS REGISTER
SENATOR JESSE KIEHL, District B
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Sponsor of SB 67.
CATHY SCHLINGHEYDE, Staff
Senator Jesse Kiehl
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented the sectional analysis for SB 67
on behalf of the sponsor.
JUSTIN MACK, Secretary/Treasurer
Alaska Professional Fire Fighters Association (AKPFFA)
Anchorage, Alaska
POSITION STATEMENT: Testified by invitation in support of SB 67.
DAVID PRUHS, Mayor
City of Fairbanks
Fairbanks, Alaska
POSITION STATEMENT: Testified by invitation in support of SB 67.
DEANTHA SKIBINSKI, Executive Director
Alaska Miners Association
Anchorage, Alaska
POSITION STATEMENT: Co-presented the Mining Industry Update.
KAREN MATTHIAS, Executive Director
Council of Alaska Producers
Anchorage, Alaska
POSITION STATEMENT: Co-presented the Mining Industry Update.
MIKE SATRE, Director
Governmental Affairs
Hecla Mining Company
Juneau, Alaska
POSITION STATEMENT: Co-presented the Mining Industry Update.
ACTION NARRATIVE
3:32:22 PM
CO-CHAIR CLICK BISHOP called the Senate Resources Standing
Committee meeting to order at 3:32 p.m. Present at the call to
order were Senators Kawasaki, Claman, Wielechowski, Co-Chair
Giessel, and Co-Chair Bishop. Senators Dunbar and Kaufman
arrived soon thereafter.
SB 67-PFAS USE FIREFIGHTING
3:33:19 PM
CO-CHAIR BISHOP announced the consideration of SENATE BILL NO.
67 "An Act relating to firefighting substances; and providing
for an effective date."
3:33:36 PM
SENATOR JESSE KIEHL, District B, Alaska State Legislature,
Juneau, Alaska, sponsor of SB 67, introduced the legislation
speaking to the following sponsor statement:
Per- and polyfluoroalkyl substances (PFAS) are a group
of chemicals harmful to human health. They are linked
to serious health conditions including low birth
weight, thyroid disease, and cancereven at extremely
small concentrations.
They also make excellent ingredients in firefighting
foams, in part because they resist breaking down. When
firefighting foams or other compounds containing PFAS
seep into drinking water, the toxic "forever
chemicals" linger for years.
The Alaska Department of Environmental Conservation
declared PFAS hazardous substances several years ago.
Senate Bill 67 protects Alaskans' health and prevents
future pollution by banning PFAS foams unless federal
law preempts. The bill also requires the state to take
back small quantities of PFAS foam to ensure it's
disposed of safely.
Because there is not yet an effective alternative for
the intensity of fire threat oil & gas operations face
at refineries or the Trans Alaska Pipeline terminal,
the bill exempts those producing, transporting, or
refining oil and gas until the State Fire Marshal
determines an effective non-PFAS substance could do
the job.
3:34:01 PM
SENATOR KAUFMAN and SENATOR DUNBAR joined the committee.
SENATOR KIEHL stated that with a few small exceptions, SB 67
says no new spraying of PFAS-containing firefighting foams into
Alaska's environment. The bill acknowledges that as long as the
FAA maintains its requirement, the prohibition against spraying
PFAS-containing foams will be federally preempted. Fortunately,
there is a congressional mandate for the FAA to lift that
requirement, and several products are in the process that meet
US military specifications for fluorine-free foam.
SENATOR KIEHL said the other issue is right now there are no
fluorine-free foams that will handle the volume of hydrocarbons
in the oil and gas industry. Research is ongoing and products
are available now that come close to putting out large oil and
gas fires. SB 67 says that once those products are available,
certified effective, and have gone through the full public
regulatory process, the state fire marshal will mark the
transition for the oil and gas industry.
SENATOR KIEHL also flagged the takeback provision. He explained
that the bill requires the executive branch to take back up to
25 gallons of PFAS-containing foam from small entities to ensure
that the foam is disposed of appropriately. His expectation is
these small quantities will be put with the PFAS-containing
foams that the State Airport System owns and disposed of
together.
3:42:24 PM
CATHY SCHLINGHEYDE, Staff, Senator Jesse Kiehl, Alaska State
Legislature, Juneau, Alaska, presented the sectional analysis
for SB 67 on behalf of the sponsor:
Sec. 1 of the bill creates a new section:
Sec. 46.03.340(a): Everyone outside the oil & gas
industry must stop using PFAS containing foams, unless
federal law preempts Alaska law.
Sec. 46.03.340(b): The oil & gas industry may continue
using PFAS-containing foams until an alternative is
approved by regulation.
Sec. 46.03.340(c): The state fire marshal can
determine there is a safe and effective PFAS-free foam
for fighting oil or gas fires if the alternate foam is
listed by an organization in OSHA's Nationally
Recognized Testing Laboratory Program. The fire
marshal must require the new foam by regulation, with
a stated effective date.
Sec. 46.03.350(d): DEC must take up to 25 gallons per
year of PFAS-containing firefighting foam from
Alaskans for disposal.
Sec. 2 of the bill sets an effective date of January
1, 2024.
3:43:18 PM
SENATOR WIELECHOWSKI asked if there was reason to believe that
safe alternative firefighting substances were available.
SENATOR KIEHL answered yes, with the exception of the large and
intense fires that might occur at oil and gas storage
facilities. Nearly all of Europe has been fluorine-free for
years and those foams are plenty effective for the volumes of
air traffic that go through Anchorage, Fairbanks, and anywhere
else that jets land in Alaska.
SENATOR WIELECHOWSKI asked if PFAS is still used at major
airports in Alaska.
SENATOR KIEHL answered yes; the Federal Aviation Administration
still requires DOT to use those foams. However, the testing that
used to occur on runways is done in contained areas so the PFAS-
containing foam does not escape into the environment. If there
were a fire, the PFAS-containing foam would be used at this
point.
3:44:37 PM
SENATOR GIESSEL mentioned an article that highlighted PFAS in
ski wax and commented on firefighters' risk of exposure.
SENATOR KIEHL confirmed that first responders often are exposed
to significant quantities of PFAS. He said it's a concern that
PFAS chemicals are present in a lot of products. SB 67 focuses
on the single greatest threat; PFAS in drinking water.
3:46:14 PM
SENATOR KAWASAKI asked if there was a large cost differential
between the firefighting foams used in Europe and the PFAS-
containing foams used in the US.
SENATOR KIEHL said he didn't have a cost comparison, but it is
good news that established manufacturers throughout the world
produce fluorine-free foams that work.
3:47:08 PM
SENATOR CLAMAN asked if he had a timeline for when the military
will approve PFAS-free firefighting foams.
SENATOR KIEHL said the process is expected to be 60-90 days, and
it's begun for some products. He said that should trigger the
FAA to lift its requirement to use fluorinated foams at
airports. It already is well past the congressional deadline to
do so. He said there is no guarantee, but he believes that the
FAA will begin the process to lift its requirement in 3-4
months.
SENATOR CLAMAN commented that it sounds as though this could all
occur within the next 6-12 months.
MS. SCHLINGHEYDE responded that the FAA indicated it would
remove the requirement to use fluorinated foams within 3-4
months.
CO-CHAIR BISHOP turned to invited testimony.
3:49:13 PM
JUSTIN MACK, Secretary/Treasurer, Alaska Professional Fire
Fighters Association (AKPFFA), Anchorage, Alaska, testified by
invitation in support of SB 67. He provided his extensive
professional background, and said being a fire fighter is unique
and routine until it isn't. He described going into buildings
with zero visibility and responding to victims who might not see
another day. He said it's clear that this career can be
dangerous.
He said he learned how to keep himself safe early in his career,
but what he failed to understand was that despite being careful,
following standard guidelines, decontaminating himself and his
equipment, and wearing the most up to date equipment he and
other fire fighters were going to be exposed to some of the
worst chemicals on earth. These chemicals permeate gear and seep
into fire fighters' pores. The data shows that firefighters have
significantly higher rates of cancer than the general
population. The World Health Organization classifies the
occupation as carcinogenic.
MR. MACK stated that SB 67 is an attempt to limit fire fighters'
and the public's exposure to known carcinogens. He emphasized
that there are alternatives to the use of PFAS-containing foam
and strongly urged support for SB 67.
3:52:41 PM
DAVID PRUHS, Mayor, City of Fairbanks, Fairbanks, Alaska,
testified by invitation in support of SB 67. He stated that the
Interior has an extensive problem associated with the dispersal
of PFAS. The City of Fairbanks spent $5.4 million to supply
water to 74 homes after PFAS from a firefighting training center
migrated into a private utility's water system. The city also
has an issue with concentrate discharge from its wastewater
system and is seeking help from DEC on behalf of Golden Heart
Utilities for a biosolids incinerator testing project. He agreed
with Senator Kiehl that alleviating the problem starts with
removing PFAS from the system.
3:55:00 PM
CO-CHAIR BISHOP held SB 67 in committee.
3:55:07 PM
At ease
^PRESENTATION(S): MINING INDUSTRY UPDATE
PRESENTATION(S): MINING INDUSTRY UPDATE
3:55:55 PM
CO-CHAIR BISHOP reconvened the meeting and announced a mining
industry update.
3:56:39 PM
DEANTHA SKIBINSKI, Executive Director, Alaska Miners
Association, Anchorage, Alaska, introduced herself.
3:56:50 PM
KAREN MATTHIAS, Executive Director, Council of Alaska Producers,
Anchorage, Alaska, introduced herself.
3:56:52 PM
MIKE SATRE, Director, Governmental Affairs, Hecla Mining
Company, Juneau, Alaska, began with a safety share from Greens
Creek Mine, which is how each meeting is started in the mining
industry. It demonstrated that Hecla employees are well schooled
in how to recognize and act in emergency medical situations. It
also highlighted the importance of self-awareness and knowing
when to ask for help.
3:59:27 PM
MS. MATTHIAS began by describing the three parts of the
presentation.
similar First, she would discuss the global outlook including:
similar the soaring demand for minerals to meet the need for
more renewable technologies and energy storage;
similar the increasing non-partisan concern about
overdependence in the US on mineral imports being a
threat to national security and the economy; and
similar the agreement that more domestic production of
minerals is needed.
similar Alaska embodies the principle of the USG and its
mineral assets should be leveraged.
similar Next, Ms. Skibinski would discuss Alaska's
environmental standards, community partnerships with
local mines, and the benefits that accrue.
similar Finally, Mr. Satre would answer the question of why Alaska
doesn't have more mines and how it can be positioned to be
more competitive.
MS. MATTHIAS turned to slide 3, New Technologies are More
Mineral Intensive. She directed attention to the image of the
house on the top left that identifies the minerals that are used
in daily life. It illustrates that everything that's used today
is either made of minerals or it was grown or transported using
metals and minerals. The image of cell phones on the lower left
illustrates the mineral intensity of new technologies. The
periodic table below the first generation cell phone shows it is
much less mineral intensive than the current generation smart
phone. The third image shows the enormous increases in the use
of specific minerals to produce electric vehicles. She noted
that zinc and silver are already produced in Alaska. Copper,
cobalt, and graphite are also present in resources that could be
developed in Alaska in projects already under development.
4:02:08 PM
MS. MATTHIAS displayed slide 4, stating that international
organizations like The World Bank and The International Energy
Agency have published reports about the increasing demand for
minerals. There is also a growing awareness that not all
countries enforce health and safety regulations or sound
environmental practices. She cited cobalt as an example and
noted that most of it comes from the Democratic Republic of the
Congo where child labor is exploited. This points to the need
for companies and countries to commit to responsibly sourced
production and processing.
MS. MATTHIAS turned to slide 5, noting that some ask if
recycling is the solution. She said it's important but only a
small part of the solution. She read an excerpt from The World
Bank:
?even if we scale up recycling rates for minerals like
copper and aluminum by 100%, recycling and reuse would
still not be enough to meet the demand for renewable
energy technologies and energy storage.
4:03:49 PM
MS. MATTHIAS turned to slide 6, The US Dependency on Mineral
Imports. She pointed to the chart showing the top three
countries that extract critical minerals and the top three
countries that process critical minerals. The US is not among
those countries even though it has the potential. She noted that
China dominates the supply chain in processing and that China
owns 15 of the 17 industrial operations for cobalt mining in the
Congo. China dominates extraction more than the slide shows.
4:04:59 PM
CO-CHAIR BISHOP stated that the US could achieve net zero carbon
by 2050 faster if it mined minerals in the US instead of relying
on supplies from foreign countries.
4:05:25 PM
MS. MATTHIAS continued to slide 7, stating that there is
increasing recognition that America's increasing dependence on
China in particular for critical materials is a threat to
national security and the economy. In 2020 President Biden
issued an Executive Order that addressed the threat to domestic
supply chains by supporting domestic mining; in 2021 he ordered
a review of US supply chains; and in 2022 he announced major
investments to expand the domestic critical minerals supply
chain. Senator Murkowski and Senator Sullivan agreed, pointing
to Alaska's extensive resources.
4:06:35 PM
MS. MATTHIAS directed attention to the state map on slide 8 that
shows the mining activity throughout Alaska. She noted that the
large mines in the state were developed after the passage of the
Clean Water Act, the Clean Air Act, and the National
Environmental Policy Act (NEPA). These laws require federal
agencies to assess the environmental impacts when considering
permit applications. She noted that the handout with this map
includes information about each of the mines.
4:07:20 PM
DEANTHA SKIBINSKI, Executive Director, Alaska Miners
Association, stated that she would discuss the reasons that
Alaska can contribute to the mineral supply chain. She said
mines in the state are permitted under strict environmental
policies that provide for closure and reclamation of the land.
Financial assurance is required. The regulatory regime ensures
that the environment is protected and often enhanced. She noted
that she would provide examples later in the presentation.
4:08:11 PM
MS. SKIBINSKI advanced to slide 10, Strict Operational
Oversight, and spoke to the following:
Alaska: the best mine monitoring
system in the world
• Water quality monitoring
• Bottom-to-top comprehensive biomonitoring
• 3rd party audits
She described Alaska's water quality monitoring systems as one
of the best in the world. Mining companies are required to
monitor water quality in streams and the ground water downstream
from the mine. Biomonitoring looks at the health of the
downstream ecosystem, from the bottom of the food chain to the
top. This will show whether juvenile fish are absorbing any
metals and the algae composition at the bottom of the water bed.
Third-party audits of the mine are done every five years and
this information is publicly available.
4:10:01 PM
MS. SKIBINSKI directed attention to the picture on slide 11 of
Red Dog Creek upstream from the mine. She said the red stain in
the water and on the banks comes from natural mineralization.
This resulted in little vegetation along the bank, a lot of
sandbars, and poor habitat for fish. Today, there is abundant
vegetation and fish populations. She pointed to the chart on the
right that shows the high naturally occurring zinc levels
reported to DEC and EPA before mining operations and the reduced
levels after.
CO-CHAIR BISHOP noted that this water source was a tip off for
the discovery of the mineral deposit at Red Dog.
MS. SKIBINSKI agreed.
MS. SKIBINSKI continued to slides 12 and 13 that provide
additional examples of restoration projects at the Fort Knox
Gold Mine and Greens Creek Mine, both of which improved habitat
and fish passage.
4:13:24 PM
MS. SKIBINSKI advanced to slide 14 to describe how regulatory
oversight doesn't stop when a mine closes. The pictures at the
top of the slide show the reclamation done at the Usibelli Coal
Mine in January 2016 and July 2016. She spoke to the following:
Reclamation and Closure
• Alaska law (AS 27.19) requires that a mine site must
be returned to a stable condition compatible with
the post-mining land use
• Plan must be approved by DNR Commissioner before
operations begin
• Financial assurance applies to all companies
• Reviewed every 5 years or earlier if necessary
CO-CHAIR BISHOP commented that Joe Usibelli senior was doing
reclamation work before it was required.
CO-CHAIR GIESSEL added that the son of the man who founded the
mine told her that they collect native seeds from the area that
are used in reclamation.
MS. SKIBINSKI said the side by side photos are a visual
illustration of how successful reclamation is at Usibelli.
4:15:45 PM
SENATOR CLAMAN referenced slide 8 and asked whether a federal
permit would still be required for the six mines signified by
red stars, regardless of whether the state assumed the 404
program, because of their locations relative to WOTUS.
MS. SKIBINSKI offered to follow up with the answer.
SENATOR CLAMAN said he was curious about where the producing
mines fit in the rubric.
4:17:19 PM
MS. SKIBINSKI turned to the picture on slide 15 of the
reclamation project that was done after the True North Mine
closed. She highlighted the following:
DNR Commissioner Corri Feige: "The developers leased
state land, produced a valuable commodity to serve
global markets, employed Alaskans, and paid state
taxes and royalties. When they were done, they
remediated the effects of their work and returned the
land to the state for its next use. The system works."
October 27, 2020
4:18:09 PM
MS. SKIBINSKI directed attention to the drawing of the tree on
slide 16 that shows the benefits mining brings to the people of
Alaska. She noted that the 2022 data from the McKinley Group
study of the economic and community benefits was forthcoming,
but her message today was about the regional impacts that come
from mining. She pointed to the white dots on the state map on
slide 17 and conveyed that those represent the more than 90
communities throughout the state where mining employees live.
She said it's often in rural Alaska where there aren't a lot of
other opportunities. She noted that the pictures on the next
slide illustrate that local mines support local businesses. In
2022, they spent $1 billion on goods and services from more than
450 Alaska vendors.
4:19:59 PM
MS. SKIBINSKI advanced to slide 19, Training Opportunities and
Jobs for Alaskans, and discussed the following:
• $2.7 million to UA and vocational schools in 2022
• AVTEC, MAPTS, underground mine training center
• On-the-job training
• Scholarships: UA, ANSEP
• 11,400 direct, indirect & induced jobs
4:20:51 PM
SENATOR KAWASAKI shared 2019 data that shows that 37 percent of
mine workers in Alaska are nonresidents. He asked what the
industry was doing to increase Alaska hire.
4:21:36 PM
MS. MATTHIAS said it makes sense to hire Alaskans, and mining
companies have been investing in vocational training
opportunities for years through both the university and some K-
12 programs. There is also an underground mine training center
in Delta Junction that Pogo, Greens Creek, and Kensington
utilize. The graduates from this six week program receive
conditional employment offers from one or more of those three
underground mines. The mining industry also reaches out to
middle and high school students to make them aware of the career
options in mining. She continued that the out migration of young
working age Alaskans has been a challenge for mining and all
other industries. She said it will take a concerted effort from
all sectors and the state to resolve that issue because the jobs
are available.
CO-CHAIR BISHOP noted that he and Mr. Satre worked on the issue
of nonresident miners in Alaska in 2007, and the training center
in Delta was a good example of that effort.
4:25:37 PM
MS. SKIBINSKI advanced to slide 20, Benefits to Alaska Native
Corporations, and spoke to the following:
• ANCSA 7(i) and 7(j) royalty sharing:
o $94 million to Alaska Native Corporations and at-large
shareholders in 2022
o $1.7 billion since 1989
• Jobs for shareholders. Red Dog example:
o Regular: 52% NANA shareholders
o Seasonal/temp: 97% NANA shareholders
• Business partnerships
4:27:09 PM
MS. SKIBINSKI displayed slide 22, Mining Taxes and Royalties
Depend on Land Status, and distinguished between taxes and
royalties; taxes are paid to a government and royalties are paid
to the landowner. Landowners could be the state, the Alaska
Mental Health Trust, the federal government, or a native
corporation. She said Pogo is the only metal mine located
entirely on state land and the only coal mine in Alaska is on
state land, which means the state receives royalties from just
these two mines.
MS. SKIBINSKI stated that the data on slide 23, Mining Industry
Payments to the State, 2022, came from the McKinley Research
Group. She encouraged the committee to also look at the full
state numbers that are published in the annual Mineral Industry
report that DNR's Division of Geological and Geophysical Surveys
produces. It breaks the revenue down by category, so it gives
the real picture of mining revenue and all the ways that mining
contributes to the state. The table at the beginning of the
report has 5-6 years of revenue numbers so an average can be
calculated.
4:30:50 PM
CO-CHAIR BISHOP offered his understanding that the Red Dog
expansion would be on state land underground so the state will
receive royalty payments from that.
MS. MATTHIAS agreed.
4:31:23 PM
SENATOR CLAMAN offered his understanding that the state collects
corporate income tax from mines but, unlike oil, there is no
production tax on minerals.
MS. MATTHIAS responded that, in addition to corporate tax and
royalties, all mines in Alaska pay a mining license tax and the
large mines pay 7 percent, which is the top tier.
SENATOR CLAMAN asked for the basis of the 7 percent.
MS. MATTHIAS replied it's based on net income.
4:32:22 PM
MS. MATTHIAS stated that the chart on slide 24, Mining Revenue
vs. Costs to State, comes from the University of Alaska
Anchorage Institute of Social and Economic Research. This study
looked at state revenue and expenses averaged over four years.
For those four years the average cumulative state and local
revenue was just under $100 million. The average state expenses
and capital budget funds expended to manage the mining industry
were significantly lower than the average revenue, so there was
a net benefit to the state from mining. She said one of the
reasons for the small state expenses is because of the
reimbursable services agreements that most large mines and large
projects enter into with the Office of Project Management and
Permitting (OPMP) under DNR. The costs for licensing and
expansions that OPMP and other state agencies incur are billed
back to the companies. She noted that the bottom four lines on
the previous slide are agency costs that were reimbursable. She
also highlighted that mines are the largest single taxpayers in
the Fairbanks North Star Borough, the City and Borough of
Juneau, and the Northwest Arctic Borough. It's a reliable source
of revenue for local governments.
4:35:23 PM
MIKE SATRE, Director, Governmental Affairs, Hecla Mining
Company, stated that he was asked to give the company
perspective on things facing the mining industry in Alaska. He
relayed that he has been in the mining industry for 27 years,
some of which was underground, and now his role includes
external affairs. He said Hecla Mining Company started more than
100 years ago and the corporate office is in Coeur d'Alene,
Idaho.
MR. SATRE spoke to the importance the mining industry has always
placed on the metals and mineral space, noting that the general
public and policy makers seem more aware that the future is
built on minerals. Every day there are new and innovative ways
to use minerals to power technologies that are used daily. It
may be minerals that most people haven't heard of like Germanium
(Ge) or Gallium (Ga) or the well-known mineral Silver (Ag).
Hecla produces 40 percent of the US supply of silver, 30 percent
of which comes from Greens Creek.
4:37:39 PM
MR. SATRE turned to slide 26 to discuss Alaska's unlimited
mineral potential. He noted that the DGGS map identifies mineral
occurrences and prospects throughout the state. Nearly every
known mineral can be found somewhere in Alaska. He said the
question now is how Alaska can go from being America's mineral
warehouse to becoming America's mineral powerhouse.
MR. SATRE advanced to slide 27, Pathway to (mineral) prosperity,
and asked "What can we do to turn the dots on the map into
operating mines that provide the regional benefits that Deantha
and Karen talked about?" He spoke to the following:
• Community support
• Infrastructure partnerships
• Stable fiscal climate
• Stable regulatory regime
He said new mines may come to Alaska if the foregoing is
addressed. He noted that from 2001 to 2010, $1.8 billion was
spent on exploration in the state; over that time the Pogo and
Kensington mines opened. From 2011 to 2020, another $1.6 billion
was spent on exploration and no new mines opened. He emphasized
the importance of continuing to work to attract exploration
dollars into Alaska if the state expects to produce its
minerals, improve the mineral supply chain in the US, and
provide the country with the minerals Americans use in their
daily lives.
MR. SATRE expressed hope that the committee members would
participate in the visit to Kensington in April. He opined that
boots on the ground and talking to the workforce about what they
do was incredibly important.
4:48:31 PM
SENATOR KAUFMAN mentioned the planning that went into the Trans
Alaska Pipeline System, and asked whether adequate big-picture
strategic planning was being done to identify all the interfaces
and infrastructure needs for mineral production and delivery,
including value-added activities. "What are the prerequisites
that we need to have and what sympathetic elements do we need to
have working with each other to really deliver some of this
opportunity?"
MR. SATRE replied that the mining industry currently is not as
vertically integrated as the petroleum industry. He said there
might be opportunity for value-added products, but that probably
would require port access to worldwide markets because markets
in Alaska aren't large enough to support a smelter or refiner
whether it's for traditional metals or rare earths. Access to
power would also be critical. He cited the example of the
aluminum smelter at Kitimat in Northern BC Canada that was only
there because it had hydro power. He continued that for the
mining industry, planning starts with both state and federal
land management plans that recognize there is mineral potential
throughout and identify how to extract those minerals yet
preserve the high ecological value. He cited Hecla's Greens
Creek mine in a national monument as an example of how that can
be done. Long term, he said it's necessary to get
representatives from all the industry groups in Alaska together
to look at where roads are needed, where rail access is
appropriate, where ports should be used, and where there is
adequate power. He said these things aren't unique to the mining
industry; they're needs for communities and all the other
industries in Alaska.
4:53:24 PM
MS. MATTHIAS pointed out that the annual reports from the Alaska
Minerals Commission list industry priorities and there are
commonalities from year to year. They are an example of the
mining industry identifying specifically what's missing in order
for the industry to be robust. She also posited that the efforts
by various administrations to bring roads to resources was a
long-term vision of opening areas of Alaska to mineral resource
development.
4:54:53 PM
SENATOR CLAMAN noted that she described most of the large mines
in Alaska as world class and asked if there was a ready
definition for "world class mine."
MR. SATRE said no, but companies have internal evaluation
systems and there are general industry standards based on size.
From a qualitative perspective, Red Dog is one of the largest
zinc mines in the world, Greens Creek is one of the largest
silver producers in the world, the Fort Knox district is world
renowned for the volume of production, and Pogo is described as
a Tier 1 gold asset.
SENATOR CLAMAN commented that any mine that's developed in
Alaska will need to be a long-term project and probably will fit
into tier 1 or be described as a world-class mine, because
that's what it will take to justify the investment and expense.
MR. SATRE agreed that was a good way to look at it, because
there was no question that access to roads, ports, and power
were key things that allow a prospect to move forward. He
posited that if Donlin were located on I-80 in Nevada it would
have been in production for the last 20 years.
4:57:45 PM
CO-CHAIR GIESSEL commented that it's not always a company that
identifies a resource for development. She pointed to the Manh
Choh project on property the Village of Tetlin owns that has a
significant amount of gold. It's under development and has
brought wealth, educational opportunities, and jobs to this
village that previously was lacking in all those areas.
CO-CHAIR BISHOP added that the deposit was only 12 miles off the
road system. He highlighted the 2012 presentation by USGS at the
University of Alaska that said Alaska was 50 years behind in
knowing what it has for assets. That is how under-explored this
state is.
4:59:42 PM
MR. SATRE added that USGS and other US agencies have spent over
$900 million to advance the mineral opportunities in Afghanistan
but very little in Alaska.
5:00:15 PM
There being no further business to come before the committee,
Co-Chair Bishop adjourned the Senate Resources Standing
Committee meeting at 5:00 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Presentation Mining Industry Update 03.01.2023.pdf |
SRES 3/1/2023 3:30:00 PM |
|
| SB 67 Sponsor Statement ver. A 2.13.2023.pdf |
SRES 3/1/2023 3:30:00 PM |
SB 67 |
| SB 67 Sectional Analysis ver. A 2.13.2023.pdf |
SRES 3/1/2023 3:30:00 PM |
SB 67 |
| SB 67 Fiscal Note DPS 2.24.2023.pdf |
SRES 3/1/2023 3:30:00 PM |
SB 67 |
| Presentation Support Document AMA AK Mines Map 03.01.2023.pdf |
SRES 3/1/2023 3:30:00 PM |
|
| SB 67 ver. B.PDF |
SRES 3/1/2023 3:30:00 PM |
SB 67 |