Legislature(2021 - 2022)BARNES 124
03/23/2022 01:00 PM House RESOURCES
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| Audio | Topic |
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| Presentation: Mining Industry Update by Council of Alaska Producers & Alaska Miners Association | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
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ALASKA STATE LEGISLATURE
HOUSE RESOURCES STANDING COMMITTEE
March 23, 2022
1:04 p.m.
MEMBERS PRESENT
Representative Josiah Patkotak, Chair
Representative Grier Hopkins, Vice Chair
Representative Calvin Schrage
Representative Sara Hannan
Representative George Rauscher
Representative Mike Cronk
Representative Ronald Gillham
Representative Tom McKay
Representative Zack Fields
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
PRESENTATION: MINING INDUSTRY UPDATE BY COUNCIL OF ALASKA
PRODUCERS & ALASKA MINERS ASSOCIATION
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
DEANTHA SKIBINSKI, Executive Director
Alaska Miners Association
Anchorage, Alaska
POSITION STATEMENT: Co-presented a PowerPoint presentation,
titled "Mining Industry Update."
KAREN MATTHIAS, Executive Director
Council of Alaska Producers
Anchorage, Alaska
POSITION STATEMENT: Co-presented a PowerPoint presentation,
titled "Mining Industry Update."
GRETA SCHURECH, Senior Advisor
Government and External Affairs
Teck Alaska, Incorporated
Kotzebue, Alaska
POSITION STATEMENT: Co-presented a PowerPoint presentation,
titled "Mining Industry Update."
WAYNE HALL, Community and Public Relations Manager
Teck Alaska, Incorporated
Juneau, Alaska
POSITION STATEMENT: Co-presented a PowerPoint presentation,
titled "Mining Industry Update."
ACTION NARRATIVE
1:04:03 PM
CHAIR JOSIAH PATKOTAK called the House Resources Standing
Committee meeting to order at 1:04 p.m. Representatives
Hopkins, Schrage, Hannan, Rauscher, Cronk, Gillham, McKay, and
Patkotak were present at the call to order. Representative
Fields arrived while the meeting was in progress.
^PRESENTATION: Mining Industry Update by Council of Alaska
Producers & Alaska Miners Association
PRESENTATION: Mining Industry Update
1:04:25 PM
CHAIR PATKOTAK announced that the only order of business would
be a presentation on the mining industry update in the state.
1:06:06 PM
DEANTHA SKIBINSKI, Executive Director, Alaska Miners
Association, gave an overview of the PowerPoint presentation,
titled "Mining Industry Update" [hard copy included in the
committee packet]. She offered the opinion that Alaska is a
great place for mineral production. She stated that the
presentation will outline the benefits of mineral extraction for
Alaskans. She explained that minerals are used in the
construction of many conveniences, such as airbags in cars and
medical devices, and this use requires steady mineral production
worldwide. She stated that the pursuit of renewable energy
technology and energy storage has also increased worldwide
demand and production. For example, the typical electric car
requires six times more mineral components than a conventional
vehicle, and an onshore wind plant requires nine times more
minerals than a similar gas-powered plant. She suggested that
the need for minerals could increase six times by 2040. She
added that the carbon footprint from the production, extraction,
and end use of minerals creates only six percent of the
greenhouse gases generated by fossil fuels. She continued that
investment in mineral recycling technology would improve the
efficiency of recycling minerals; however, according to
projections from the World Bank, doubling the recycling rates
would still not meet the need.
MS. SKIBINSKI recommended that the state prioritize the
investment in new mineral supplies by reinforcing national
geological surveys, streamlining permitting procedures,
providing financial support, and raising public awareness about
contributions made by mineral projects to the energy sector.
She pointed out a statement from the executive director of the
International Energy Agency, which expressed that there is a
mismatch between the world's climate ambitions and the
availability of the critical essential minerals needed. She
stated that the executive director advised that "governments
must give clear signals about how they plan to turn their
climate pledges into action" and "acting now and acting
together, they can significantly reduce the risks of price
volatility and supply disruptions."
MS. SKIBINSKI stated that Alaska meets many of the pillars of
approach towards mineral security. She explained that sourcing
minerals domestically makes the nation stronger and helps
vulnerable countries. She gave the following examples:
currently 98 percent of U.S. rare-earth needs come from China,
and the Democratic Republic of Congo uses child labor to produce
a significant portion of the world's cobalt. She argued that
Alaska would be a better place to mine because of stricter
safety and environmental laws.
1:12:05 PM
MS. SKIBINSKI pointed out that access to mineral deposits in
Alaska is difficult because of the patchwork of private, state,
and federal land ownership. She stated that federal policy
drives the mining industry, and the permitting process can take
years.
1:15:54 PM
KAREN MATTHIAS, Executive Director, Council of Alaska Producers,
emphasized that creating a low-carbon future through technology
increases the demand for minerals. She argued that increasing
the domestic production of minerals is good for the nation's
economy and security. She expressed the opinion that mining in
Alaska is "being done right" because of the strict environmental
and safety standards. She stated that Alaska is highly rated
for pure mineral potential.
MS. MATTHIAS pointed out the mining prospects in Alaska, as seen
on slide 8. She explained that Alaska has many prospects, but
there are few mines because of the remoteness of the locations
and the lack of infrastructure. She added that labor shortages,
supply chain issues, and permitting issues also make it
difficult to develop new mines. For examples of successful
mines in Alaska with easy access, she pointed out the Fort Knox
Mine, Pogo Mine, Usibelli Coal Mine, Greens Creek Mine, and
Kensington Gold Mine. She pointed out that the Donlin Gold
Project and Pebble Project are both in the permitting process.
1:22:35 PM
MS. SKIBINSKI noted that there are 170 placer mines across the
state. These mines have small footprints, few employees, and
operate seasonally. She expressed the opinion that the
organizations and agencies overseeing the state's mines have a
world-class regulatory system for all aspects of the
environment. She said that the permitting process for mines
involves a mixture of state, federal, and local requirements.
In addition to the governing laws, mines are often required to
perform additional practices. On slide 14 she pointed out the
complex permitting process, emphasizing the multiple
opportunities for public comment.
1:26:45 PM
MS. MATTHIAS expressed the opinion that, with respect to mines,
Alaska has one of the best water quality monitoring systems in
the world. This includes water quality monitoring,
biomonitoring, and periodic compliance monitoring by a third-
party. She added that the state oversees these reports and
results. She continued that there is a strict regulatory
process governing mines from start to finish, including the
reclamation and closure processes. Before a mining operation is
allowed to begin, Alaska law requires that the Department of
Natural Resources (DNR) approve a plan for reclamation and
closure of the mine. The mining companies must provide
financial assurance at the outset, because if a company is
unable to perform reclamation the state would be responsible.
She stated that this would be reviewed every five years, or
earlier, if necessary. She described reclamation as a multi-
year process which is often completed concurrently with active
mining.
1:39:06 PM
GRETA SCHURECH, Senior Advisor, Government and External Affairs,
Teck Alaska, Incorporated, said that the Red Dog Mine has been
in operation since 1989, and it is operated on NANA Regional
Corporation (NRC) land by Teck Alaska. In advance of the
development of the Red Dog Mine, the region formed the Northwest
Arctic Borough, which drives local control. From the beginning
of operations up to fiscal year 2021 (FY 21), the Red Dog Mine
has paid $2.65 billion in proceeds to NRC. She said $1.6
billion has been given to other Alaska Native corporations
through the Alaska Native Claims Settlement Act, and around $1.4
billion has been paid to the state through the Alaska Industrial
Development and Export Authority for use of the 52-mile road
which connects the mine. She continued that in FY 21 $270
million has been spent on goods and services in Alaska and $80
million in wages have been paid. She stated that the Northwest
Arctic Borough has been paid $318 million in lieu of taxes,
which equates to between $20 million and $26 million annually.
The village improvement fund, which totals between $4 million
and $8 million annually, is allocated between 11 communities.
MS. SCHURECH stated that before the Red Dog Mine was created
there were no jobs or economy in the region, and, before moving
forward with the mine, the residents of the 11 communities had
been consulted 10 years in advance. She said that a hiring
preference for NRC shareholders had been written in the 1982
agreement, and as of September 2021, 57 percent of regular
employees of the mine are NRC shareholders, while around 97
percent of the seasonal and temporary staff are NRC
shareholders.
1:55:23 PM
WAYNE HALL, Community and Public Relations Manager, Teck Alaska
Incorporated, discussed an in-house apprenticeship program for
shareholders. This provides an average of 8,500 hours of
training per year, with apprentices making up 25 percent of
total trade employees. He said the mill operator apprenticeship
program started in 2016 and is the first of its kind in North
America.
1:59:38 PM
MS. SCHURECH showed the photos on slide 26 and slide 27 of
Alaska-built infrastructure projects which were created through
mining funding to the community. The infrastructure projects
include port facilities and a school.
MS. SCHURECH, in response to questions from Representative
Hannan concerning COVID-19 pandemic policies, said that prior to
acquiring testing resources, flights in-and-out were extremely
limited, and there were hotel quarantining and vaccination
requirements for new hires. She said that NRC created a
pandemic taskforce which has been continually utilized. She
added that there is a mask mandate, but it is expected this
policy will be relaxed soon. She said that testing is required
prior to arriving at the site and twice per week. This is to
catch infections as early as possible.
2:10:02 PM
MR. HALL, in response to Chair Patkotak concerning the proposed
primacy provision per [Section 404 of the Clean Water Act],
pointed out faster permit retrieval times could result from
collaboration between various departments, including DNR, the
Department of Fish and Game, and the Department of Environmental
Conservation. He mentioned the advantages of collaboration
between state agencies, pointing out the construction industry
and the Department of Transportation and Public Facilities would
benefit through a more efficient infrastructure permitting
process. He mentioned compensatory regulations in federal
wetland permitting.
2:13:44 PM
MS. MATTHIAS highlighted a common misconception - if the state
is allowed primacy concerning Section 404 of the Clean Water
Act, the state could approve the Pebble Project without federal
oversight.
2:38:06 PM
ADJOURNMENT
There being no further business before the committee, the House
Resources Standing Committee meeting was adjourned at 2:38 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Presentation Mining Industry Update from CAP and AMA for HRES 3.23.2022.pdf |
HRES 3/23/2022 1:00:00 PM |
Mining Industry Update |