Legislature(2025 - 2026)BARNES 124
02/26/2025 01:00 PM House RESOURCES
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| Audio | Topic |
|---|---|
| Start | |
| Presentation(s): Greens Creek Mine | |
| Presentation(s): Red Dog Mine | |
| Presentation(s): Usibelli Coal Mine | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE RESOURCES STANDING COMMITTEE
February 26, 2025
1:03 p.m.
MEMBERS PRESENT
Representative Robyn Niayuq Burke, Co-Chair
Representative Carolyn Hall
Representative Donna Mears
Representative Zack Fields
Representative Dan Saddler
Representative George Rauscher
Representative Julie Coulombe
Representative Bill Elam
MEMBERS ABSENT
Representative Maxine Dibert, Co-Chair
COMMITTEE CALENDAR
PRESENTATION(S): GREENS CREEK MINE
- HEARD
PRESENTATION(S): RED DOG MINE
- HEARD
PRESENTATION(S): USIBELLI COAL MINE
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
MIKE SATRE, Director, Government Affairs
Hecla Mining Company
Juneau, Alaska
POSITION STATEMENT: Presented a PowerPoint regarding the Greens
Creek Mine.
GRETA SCHUERCH, Senior Advisor for Government and External
Affairs
Teck Alaska Red Dog Mine
Anchorage, Alaska
POSITION STATEMENT: Presented a PowerPoint regarding Teck
Alaska and the Red Dog Mine.
LORALI SIMON, Vice President, External Affairs
Usibelli Coal Mine Inc.
Palmer, Alaska
POSITION STATEMENT: Presented a PowerPoint regarding the
Usibelli Coal Mine.
ACTION NARRATIVE
1:03:53 PM
CO-CHAIR BURKE called the House Resources Standing Committee
meeting to order at 1:03 p.m. Representatives Coulombe, Mears,
Hall, Rauscher, Saddler, and Burke were present at the call to
order. Representatives Elam and Fields arrived as the meeting
was in progress.
^PRESENTATION(S): Greens Creek Mine
PRESENTATION(S): Greens Creek Mine
1:04:25 PM
CO-CHAIR BURKE announced that the first order of business would
be a presentation regarding the Greens Creek Mine.
1:04:50 PM
MIKE SATRE, Director, Government Affairs, Hecla Mining Company,
gave a presentation titled "Greens Creek Mine" [hard copy
included in the committee packet]. He began with slide 3, which
summarized the history of the Hecla Mining company and listed
its current active mines around the country. He continued with
slide 4, titled "Largest Silver Producer in The U.S. & Canada,"
which provided statistics regarding Hecla's silver production
and compared its output to other silver producers.
1:08:38 PM
MR. SATRE resumed the presentation with slide 5, titled "Solar
Will Be the Largest Source Of Electricity," which displayed
graphics emphasizing the increasing need for silver in the face
of a growing renewable energy industry. He pointed out that the
largest increase in the use of silver is for photovoltaic cells
used to store solar energy.
1:10:01 PM
MR. SATRE responded to a question from Representative Elam
regarding silver production, explaining that a shortfall is
estimated for the next five to six years in terms of global
production versus global demand for silver.
1:10:41 PM
MR. SATRE addressed Representative Rauscher's question regarding
whether federal tariffs would affect Hecla's silver production.
He explained that none of the material that Hecla Mining
produces is processed in the United States (USA) and said the
tariffs would have an immediate impact on the cost of
production.
1:12:52 PM
MR. SATRE, in response to Representative Elam's question,
explained that Alaska does not have the capacity to refine the
Greens Creek metals.
1:13:58 PM
MR. SATRE resumed the presentation with slide 6, titled "Greens
Creek: Flagship Mine," which provided a brief overview of the
reserves, the metals, and performance data regarding the Greens
Creek Mine on Admiralty Island, Alaska. It described the mine
as the "11th largest silver mine globally" and stated the
following [original punctuation provided]:
Low-cost structure with AISC in best 15th percentile
of cost curve of primary silver mines*
History of continuous improvement since 2008
• 7% increase in silver recoveries
• 25% increase in throughput
Since 1987, Greens Creek has generated:
• $3.0 Billion in cash flow from operations
• $2.0 Billion in free cash flows
1:15:14 PM
MR. SATRE, in response to a question from Representative Saddler
regarding increased costs, attributed the increases to
inflation. He explained that inflation affects the cost of
supplies and personnel. There had been some cost offsets in the
past few years because other high-value metals are also
produced.
1:16:39 PM
MR. SATRE responded to a question from Representative Mears
regarding the effects of higher hydroelectric costs and the cost
of operation at Greens Creek.
1:17:16 PM
MR. SATRE resumed the presentation with slide 7, titled
"Location and History," which displayed a map of the Greens
Creek Mine and a timeline of historic events which read as
follows [original punctuation provided]:
- 1973 Exploration in Greens Creek valley
- 1975 Initial discovery
- 1978 - Admiralty Island National Monument created
- 1980 - ANILCA
- 1987 Construction
- 1989 Full production
- 1993 Operations suspended
- 1996 Land Exchange
- 1996 Operations resume
- 2008 Hecla assumes 100% control of Greens Creek
1:20:34 PM
MR. SATRE continued his presentation with slide 8, titled
"Greens Creek Overview," which read as follows [original
punctuation provided]:
• Located within Admiralty Island National Monument
• Largest private employer in Juneau
• Largest taxpayer in Juneau
• 2,600 ton per day underground mine
• 35 year production history
• Mine life of 12 years
• ~350 acres of total disturbance currently; ~30 acres
of new disturbance with next phase tailings storage
facility expansion starting in 2025
1:21:52 PM
MR. SATRE acknowledged Representative Rauscher's observation
that the annexation of Admiralty Island by the City and Borough
of Juneau (CBJ) resulted in a tax bill for the mine.
1:22:11 PM
MR. SATRE resumed his discussion of slide 8 which summarized the
Greens Creek production numbers for silver, gold, zinc, and lead
in 2024 as well as the estimated numbers for the life of the
mine. He described it as "a world class deposit."
1:22:55 PM
MR. SATRE addressed questions posed by Representative Hall
regarding the percentage of employees from Juneau and other
parts of Alaska. He explained that the mine works closely with
the Mining and Petroleum Training Center in Delta Junction, the
University of Alaska Southeast mining training program, and
other programs in the state. He pointed out that Juneau has a
small population to draw from. Of the 520 employees, 32 percent
or 171 people live in Juneau, and 7 percent live in Southeast
Alaska, and the total Alaska hire is about 52 percent. Other
employees come from Montana, Idaho, and Washington. He
explained that they are working with dual credit classes at
Juneau Douglas High School. The students are encouraged to
apply for the diesel mechanic track which is Greens Creek's area
of greatest need. He said that the numbers tend to be working
against Alaska hire because people are leaving the state and
there is an aging workforce. He identified three primary
reasons people from Outside don't stay: the weather, difficulty
of access to Juneau, and quality and availability of housing.
Greens Creek staff they encourage people to stay in Juneau
1:26:33 PM
MR. SATRE answered Representative Saddler's question regarding
which ore body might be the first to play out. He stated that
the ore body is homogenous with a combination of silver, gold,
zinc, and lead.
1:27:37 PM
MR. SATRE resumed the presentation with slide 9, titled
"Committed to Alaska," which displayed a graph labeled
"Companywide economic impact in 2023." Slide 9 also summarized
economic benefits to Alaska as follows [original punctuation
provided]:
? $190M in direct economic benefits to Alaska
? $80M in vendor payments
? $82M in employee payroll
? $19M in federal and payroll taxes
? $3.4M in state taxes
? $3M in CBJ taxes
? $324k in local contributions
? 520 employees
? Hydropower Interruptible service customer since 2005
? ~$90M in savings to Juneau firm customers
1:29:13 PM
MR. SATRE continued with slide 10, titled "Integral to our
Community," which displayed a series of photos showing
activities and investments that Hecla has made in the City and
Borough of Juneau (DCJ). He moved to slide 11, titled "920 Mine
Site," which began a "photo tour" of the Greens Creek Mine and
its facilities. He moved through slides 12-16, which displayed
a series of photos highlighting the process for mining rock at
the Greens Creek Mine. He drew the committee's attention to
slide 15, titled "Dry Stack Tailings Facility," which depicted
the current system for tailings storage. He stated that Greens
Creek was one of the first mines to adopt the environmentally
responsible dry stack cut technology and described the process.
When he presented slide 16, he observed that the Hawk Inlet port
facility has been an industrial site since the early 1900's when
it was a fish cannery. He commented that some of the old
cannery buildings are still in use.
1:34:01 PM
MR. SATRE resumed the presentation with slide 17, titled
"Potential Value Extraction From Tails," which read as follows
[original punctuation provided]:
Tailings as of Dec. 2024:
? 9.1 million DST of tailings consisting of
? 49 Moz of Silver (5 oz/ton)
? 556 koz of Gold
? 302 Mlbs of Zinc
? 198 Mlbs of Lead
? 26 Mlbs of Copper
? 5.4 Mlbs Antimony
? 1.1Mlbs of Nickel
? Includes other critical minerals Arsenic,
Barium, Bismuth, Cadmium, Chromium, Gallium,
Germanium, Manganese, Vanadium
? Opportunity for reprocessing includes marketing,
participation in DoD/DoE CM initiatives
? Reprocessing tailings would reduce reclamation
obligations
? Metals in tailings represent >$3B in gross value
He described tailing reclamation as a long-term environmental
responsibility with planning requirements for stabilizing the
tails and providing safe water. He pointed out that the
tailings are still valuable. Because the mine produces such
high-grade ore, the tailings also tend to be high-grade. He
stated that the metals would not be easy to extract, but the
mine had been working with the University of Alaska Fairbanks
and several private companies to find ways to extract the high
value metals
1:35:38 PM
MR. SATRE answered questions from Representative Saddler and
Representative Coulombe. He presented several possibilities
regarding the potential permitting process for re-working the
tailings. Regarding workplace safety at the Greens Creek Mine,
he described a "very strong safety culture," citing the lack of
fatalities and describing most injuries as minor such as
sprained ankles.
1:38:58 PM
MR. SATRE responded to a hypothetical question from
Representative Saddler regarding the possibility of increased
taxes or fees by CBJ. He stated that an increase in taxes is an
increase in costs which could shorten the life of the mine over
time. He said the taxes and fees include CBJ taxes, the Alaska
mining license tax, the Alaska corporate income tax, and the
fuel tax.
1:40:18 PM
The committee took a brief at-ease at 1:40 p.m.
^PRESENTATION(S): Red Dog Mine
PRESENTATION(S): Red Dog Mine
1:41:30 PM
CO-CHAIR BURKE announced that the next order of business would
be a presentation regarding Teck Alaska and the Red Dog Mine.
1:41:37 PM
GRETA SCHUERCH, Senior Advisor for Government and External
Affairs, Teck Alaska Red Dog Mine, presented a PowerPoint
regarding Teck Alaska and the Red Dog Mine [hard copy included
in the committee packet]. She started her presentation with a
brief summary of the mine and showed slide 2, titled "Red Dog
Operations," which read as follows [original punctuation
provided]:
• Red Dog is located about 622 miles northwest of
Anchorage,
Alaska
• 106 miles north of the Arctic Circle
• At the Western end of Brooks Range
• Began operating in 1989
She continued with slides 3 and slide 4. Slide 3 was titled
"1981 1982 Partnership with NANA - Community Engagement Ahead
of its Time," and slide 4 featured a map of the NANA Regional
Corporation. Slide 3 highlighted the partnership between the
NANA Regional Corporation and the Red Dog Mine and read as
follows [original punctuation provided]:
Resolution of competing title claims critical
• NANA leaders visited Cominco operations: Pine Point,
Polaris, Black
Angel, Trail
1981 Letter of Intent between NANA and Cominco
• Drill deposit on 400' centers
• Before land status was resolved
1982 Landmark agreement between NANA and Cominco
• Cominco to operate under a lease agreement
• Ultimately schedule to 50:50 profit share
1:45:09 PM
MS. SCHUERCH advanced to slide 5, titled "Red Dog Operations -
Operating North of the Arctic Circle." The slide highlighted
the challenges of operating a mine in an arctic climate and
summarized production numbers. The slide read as follows
[original punctuation provided]:
Remote, Arctic climate
• ~ 100-day shipping season
• ~ 120-day exploration season
Production
• Typically, 1.0 1.3 million wet metric tonnes of
concentrate annually
Red Dog Deposits
• Main (mined out)
• Aqqaluk (2010 start)
• Qanaiyaq (2017 start)
1:45:59 PM
MS. SCHUERCH moved to slide 6, titled "Red Dog Its all about
logistics," which read as follows [original punctuation
provided]:
Power Generation
• 8 diesel generators
• 5.0 megawatts per unit
• 24.5 megawatts required
• 40,000 gallons of diesel fuel/day
Air Freight - 2023 estimate:
• 5.8 million pounds of air freight
• 200 Northern Air Cargo, Boeing 737-400
• 30 Lynden Air Cargo, C-130 Hercules
1:46:39 PM
MS. SCHUERCH, in response to Representative Elam's question
about fuel usage, stated that most of the diesel was used for
generators that power the system. Also, most of the vehicles
were diesel. He pointed out that the communities of Kivalina
and Noatak can use the barges for shipping freight.
1:47:07 PM
MS. SCHUERCH responded to Representative Mears' question
regarding how the fuel infrastructure for the Red Dog Mine
benefits neighboring communities. She explained that during the
winter months, the Red Dog provides fuel at cost for the
community of Noatak.
1:49:10 PM
MS. SCHUERCH resumed the presentation with slide 7, titled
"Broad Benefits of Development," which summarized the revenue
sharing benefits to the NANA Regional Corporation and Alaska
native corporations resulting from the Alaska Native Claims
Settlement Act. She moved to slide 8, titled "Community
Development," which highlighted a series of direct benefits to
the communities including jobs, village improvements,
contributions to education, and royalties. She continued with
slide 9, which outlined the different payments in lieu of taxes
that are made to the NANA Regional Corporation. The slide was
titled "Payments in Lieu of Taxes & Village Improvement Fund,"
and read as follows [original punctuation provided]:
Payment in Lieu of Taxes
- $20-26M annually
• Primary revenue for the Northwest Arctic Borough
(~85%)
Village Improvement Fund
- $4-8M annually
• Village Improvement Commission
• Increase benefits by setting money directly aside
for villages
• Long-term sustainability - aimed at socioeconomic
investment
1:53:13 PM
MS. SCHUERCH showed slides 10 and 11 both titled "Port
Operations." Slide 10 was a photo of the port site which was
located 53 miles from the mine. Slide 11 provided details
regarding the logistical specifics of the red dog mine's port
operations and read as follows [original punctuation provided]:
Shipping season is from early July to late October
18M - 20M Gallons of fuel imported
4,500 containers shipped via ocean barge
85,000 tons ocean of freight
1.1M wet metric tonnes Zinc concentrate shipped
230K wet metric tonnes Lead concentrate shipped
1:54:07 PM
MS. SCHUERCH moved to slide 12, which displayed a map of the
world illustrating the trade flow of zinc concentrates after
they are mined. She continued with slide 13, which showed a
photo of two of the Red Dog Mine's subsistence committees. She
described the subsistence committee's work regarding beluga
whale and caribou migration. She showed slide 14, titled
"Workforce," which highlighted the demographic makeup of Teck
Alaska's employees and read as follows [original punctuation
provided]:
Teck Alaska people on role as of December 2024
• Regular 653 (53% NANA Shareholder)
• Temporary 115 (93% NANA Shareholder)
- 22% of employees are female
1:56:35 PM
MS. SCHUERCH responded to questions from Representative Hall and
Co-Chair Burke. She explained that the Red Dog Mine employs
about 73 to 74 percent Alaskans and NANA Regional Corporation
shareholders. She explained that the 1982 operating agreement
provided for shareholder hiring preference, setting a tiered
system. Noatak and Kivalina had preference above other
shareholders in the region followed by NANA members outside
Noatak and Kivalina. The third tier was NANA shareholders who
live anywhere in Alaska
1:58:36 PM
MS. SCHUERCH resumed the presentation with slide 15, which
displayed a map of the Red Dog Mine operations. The slide was
titled " Aktigiruq & Anarraaq Extension Program (AAEP)Project
Overview," and read as follows [original punctuation provided]:
• Red Dog Mine is scheduled to exhaust the Aqqaluk
deposit in 2031
• Several deposits in the district that, if developed,
could extend the life of Red Dog Operations
• Deep deposits - more difficult to drill from the
surface and they will have to be mined using
underground mining methods
She described the new explorations in Anarraaq and Aktigiruq and
the road being built to the sites. She discussed the benefits
of having a road that can be used all year.
2:00:25 PM
MS. SCHUERCH concluded her presentation with slide 16, titled
"Aktigiruq & Anarraaq Extension Program (AAEP) Project
Overview," which read as follows [original punctuation
provided]:
• Prospect located on State of Alaska mining claims -
100% ownership of Teck American Incorporated
• Lead-zinc prospect with potential to extend Red Dog
life-of-mine beyond 2031
• 5 additional years of exploration needed
2:01:28 PM
MS. SCHUERCH answered a question from Representative Coulombe
regarding workplace safety, explaining that that the Red Dog
Mine has a "very comprehensive" safety program called the
"courageous safety leadership" program that is required of all
employees at the Red Dog Mine. She said the operation has a
culture of safety.
2:03:04 PM
MS. SCHUERCH, in response to a question from Representative
Fields, described the Red Dog Mine's five apprenticeship
programs.
2:04:35 PM
MS. SCHUERCH responded to a question from Representative
Rauscher regarding whether climate change has affected the
shipping season for the Red Dog mine. She commented that the
shipping season varies from year to year and that it has not
made anything easier.
2:05:25 PM
MS. SCHUERCH responded to a question from Co-Chair Burke
regarding the benefits of the Red Dog mine throughout all of
Alaska. She referred the committee to slide 7 and reiterated
the information presented on the slide. The native corporations
are required to share 70 percent of royalties among the 12
regional corporations, and 50 percent of the money received by
the regional corporations must be shared with the village
corporations.
2:07:34 PM
The committee took an at-ease from 2:07 p.m. to 2:10 p.m.
^PRESENTATION(S): Usibelli Coal Mine
PRESENTATION(S): Usibelli Coal Mine
2:10:07 PM
CO-CHAIR BURKE announced that the final order of business would
be a presentation regarding the Usibelli Coal Mine.
2:10:21 PM
LORALI SIMON, Vice President, External Affairs, Usibelli Coal
Mine Inc., gave a presentation titled "Usibelli Coal Mine,
Powering Alaska with Homegrown Energy" [hard copy included in
the committee packet]. She began with slide 2, which highlighted
the Usibelli Coal Mine's 82-year history as a family-owned
operation. She showed slide 3, titled "A Dedicated Team of
Employees" and slide 4, titled "Impacting the Community," which
read as follows [original punctuation provided]:
34% of Usibelli employees are 2nd, 3rd, or 4th
generation coal miners
87% males 13% females
4 employees with former military service
14 positions prefer/require four-year degrees
The mine is the largest private -sector, year -round
employer in the Denali Borough
100% All -Alaskan Workforce
105 UCM JOBS full -time and year -round positions
$14.9 MILLION in salaries & wages
$5.5 MILLION in health benefits & pensions
2:13:42 PM
MS. SIMON responded to a question from Representative Fields
regarding the combined average of wages and benefits per
employee, stating that the average for all mining employees in
Alaska was over $180,000 per employee.
2:14:26 PM
MS. SIMON resumed the presentation with slide 5, which
highlighted the Usibelli Coal Mine's safety record.
2:15:30 PM
MS. SIMON moved to slide 6, titled "Usibelli Coal Mine Today"
which highlighted the mine's coal output. The slide read as
follows [original punctuation provided]:
~ 1 million tons of ultra-low sulfur coal is produced
each year
~ 80 million tons of proven reserves under current
mining permits
More than 400 million tons of proven coal reserves in
the area
100% of Alaska's coal demand is supplied to 6 coal-
fired power plants in Interior Alaska
2:16:25 PM
MS. SIMON responded to Representative Elam and Representative
Coulombe's questions about Usibelli Coal Mine exports. She
explained that the Usibelli Coal Mine exported coal for about 30
years but has not exported since 2016 and explained the reasons.
2:18:21 PM
MS. SIMON resumed the presentation on slide 7, titled "Interior
Alaska's Existing Energy Infrastructure & Supply." The slide
provided information regarding the six coal-fired power plants
on the grid which include Eielson Air Force Base, University of
Alaska Fairbanks, Fort Wainwright, Golden Valley Electric, and
Aurora Energy. Several are co-generation plants which use waste
steam for heating.
2:18:56 PM
MS. SIMON answered a question posed by Representative Fields
regarding the implementation of carbon capture sequestration
(CCS), explaining that Usibelli was working with the University
of Alaska, Fairbanks, to research CCS.
2:19:56 PM
MS. SIMON responded to a question from Representative Rauscher
regarding the permitting challenges of expanding or adding new
coal fired plants.
2:21:08 PM
MS. SIMON resumed the presentation on slide 8, which summarized
an economic impact survey conducted by the McKinley Research
group exploring the hypothetical costs of energy in Interior
Alaska if coal was not available. She moved to slide 9, which
highlighted the role that coal plays in ensuring both military
readiness and energy security in Alaska. She continued to slide
10, titled "Impacts to the Alaska Railroad," which read as
follows [original punctuation provided]:
Coal accounts for 10% of the railroad's operating
revenues
19% of the railroad's total freight tonnage comes from
hauling coal to Interior Alaska power plants
Every coal car that rolls north on the tracks
represents local jobs, energy security, and economic
strength for Interior Alaska.
2:23:29 PM
MS. SIMON moved to slide 10, titled, "Caring for the Community,"
which focused on the Usibelli Coal Mine's educational outreach
work. The slide read as follows [original punctuation
provided]:
More than $500,000 was donated to communities
throughout Alaska supporting education, health &
social services, community events, and programs
EDUCATION PARTNERSHIPS:
$64,000 in scholarships at UAF supporting 33 students
Denali Preschool & Learning Center
On-the-Job Training & Internship Programs with
TriValley High School & UAF for: welders, mechanics,
electricians, and engineers
Alaska Resource Education support through teacher
scholarships, field trips, and event sponsorships
2:25:07 PM
MS SIMON continued with slide 11, titled "An Interior Alaska
without Coal," which emphasized the necessity of coal in
Alaska's future
2:26:13 PM
MS. SIMON responded to a question from Representative Elam
regarding improvements for clean coal. She stated that coal
plants can run just as cleanly as natural gas plants with modern
technology. She explained that Usibelli is focused on
continuous improvement and how coal can be mined better, safer,
faster, and how generation can be cleaner.
2:28:37 PM
MS. SIMON answered a question from Representative Coulombe
regarding the two Healy coal plants used by Golden Valley
Electric Association to generate electricity. She described
both Healy Unit 1 and Healy Unit 2 as reliable sources of
energy.
2:31:23 PM
ADJOURNMENT
There being no further business before the committee, the House
Resources Standing Committee meeting was adjourned at 2:31 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HL.GC.HRES.2025.pdf |
HRES 2/26/2025 1:00:00 PM |
Hecla Mining Company |
| Teck_Red Dog Mine.pdf |
HRES 2/26/2025 1:00:00 PM |
|
| Usibelli Coal Mine_HRES_February 2025_FINALv2.pdf |
HRES 2/26/2025 1:00:00 PM |