Pebble Mine

Landscape near Iliamna where Pebble Mine would be built.

Developers of the Pebble project near Lake Iliamna announced an agreement July 6 with Alaska Peninsula Corp. for transportation services related to development or operations of the mine planned by Pebble Ltd. Partnership.

APC is an Alaska Native village corporation formed by the merger of five small Bristol Bay village corporations, in Port Heiden, South Naknek, Ugashik, Kokhanok and Newhalen.

A Memorandum of Understanding signed with Pebble Partnership would have APC form a consortium of village corporations to operate all transportation services for the mine, Pebble Partnership said in a press release.

A contract would include managing operations at a planned Cook Inlet ore terminal, maintaining an access road from the port to the mine site north of Lake Iliamna and providing trucking services between the port and road.

Pebble is a large undeveloped copper, gold and molybdenum deposit 18 miles north of the community of Iliamna. The developer, Pebble Ltd. Partnership, is a subsidiary of Northern Dynasty Minerals, which owns the prospect.

A U.S. Army Corps of Engineers Final Environmental Impact Statement on Pebble will be completed and issued this summer, setting the stage for a federal Record of Decision and the issuance of key federal permits. Pebble has yet to apply for its state permits, however, which will include an important dam safety permit.

This is the third initiative Pebble has launched in recent weeks aimed at building support in the region. The first involved a profit-sharing plan for local residents. A second initiative was a Request for Proposals issued to form a regional energy entity that would take advantage of the large-scale power generation facilities at the mine and a natural gas pipeline built from Cook Inlet.

The transportation relationship would be similar to the role that support subsidiaries of NANA Regional Corp. play for the Red Dog Mine, a zinc mine on NANA-owned lands 90 miles north of Kotzebue. One example is a joint-venture NANA operates with Lynden Transport in trucking zinc ore to from the mine to a seasonal ore terminal on the Chukchi Sea coast.

Although many NANA shareholders work in Red Dog mine operations a significant number are employed in support operations like trucking.

In 2018 Pebble signed an agreement with Alaska Peninsula providing a right-of-way for access across lands owned by APC, which are the surface lands owned by the five village corporations before the merger. Part of the agreement gave Alaska Peninsula “preferred contractor” status on Pebble support contracts. Since then Alaska Peninsula has provided a number of contract support services toward mine development.

The project has become controversial because of its location near the headwaters of salmon-bearing streams that support salmon fisheries in the Bristol Bay region.

The value of the MOU to APC is expected to be $20 million a year during operations of the mine, which is expected to have an economic life spanning decades if it is built. “The operation of the logistics chain is critical to the successful development of the Pebble project and this MOU is evidence of the strong support these village corporations have provided to Pebble over the last few years,” the press release said.

“Village corporations along the northern transportation corridor (the route of the road) will play a significant and meaningful role in the development and operation of the Pebble project and will ensure full local participation in contracting and employment opportunities,” the press release said.

“This role at Pebble will also enable these village corporations to extend these services directly to the residents of the villages with the opportunity to significantly reduce the enormous cost of living in these communities,” the press release said.

Pebble’s CEO Tom Collier said, “As we near approvals of our federal permits, it is time to begin laying concrete contractual commitments for construction and operations opportunities. The Pebble opportunity is real.”

Alaska Peninsula’s CEO Dave McAlister said, “For APC and other village corporations around the lake, contract opportunities like this are how we can ensure local hire and other direct local benefits from the project while assisting in the safe development and operation of the Pebble project. We want to be at the table with the Pebble team in making good decisions for the region and ensuring our shareholders directly realize the benefits of the opportunity.”

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