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Mine industry booming

April 16, 2012
By JOHN PEPIN - Journal Staff Writer ( , The Mining Journal

MARQUETTE - Over the past few years, at least the beginnings of several mining projects have sprung up across the Upper Peninsula, creating a resurgent mining boom, which could extend for decades into the future.

Local governmental units and school districts are happy about the prospect of new tax revenue from the projects. There are others who champion the projects' ability to create new mining jobs and numerous spin-offs.

Of course there are those opposed to the projects for concerns over environmental degradation, pollution and potential health risks.

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Amy Clickner, chief executive officer of the Lake Superior Community Partnership in Marquette, said economic development does not trump environmental stewardship. But if the mining projects are properly permitted, operated and monitored, the two imperatives can go hand-in-hand.

"From an economic development standpoint, these new mining opportunities are huge investments into the community," Clickner said. "These are opportunities for communities to take a step forward instead of backwards."

The most well-known of the projects -largely because of its scope and test case status under the state's non-ferrous mining law- is the Kennecott Eagle Minerals Co. nickel and copper mine on the Yellow Dog Plains.

After a recent partial valuation of Kennecott's project by the state geologist, local taxing entities in Marquette County expected to capture a total of $4.3 million in ad valorum tax revenue for this year, with increased amounts expected in the future as production begins and initial development costs decrease.

Kennecott estimates its pay at $21 million each year, once the mine starts producing, with more than 200 people working at the facility. The capital investment of the project is expected to be more than $469 million.

In February, Orvana Minerals Corp. announced it had received its mining permit for the Copperwood copper project in Ironwood and Wakefield townships in Gogebic County.

"The approval of the 632 Permit, which is the key stage gate towards bringing the Copperwood Mine into operation, indicates that the state of Michigan considers the project to have met all the necessary criteri to operate a mine in a responsible manner," said Jim Jacques, vice president of operations and general manager of Copperwood in a news release. "As the keystone permit necessary to proceed, we believe Michigan understands the economic benefts mining can provide and we are confident that the follow-up permits are forthcoming."

Last month, Aquila Resources entered into an operating agreement with HudBay Minerals Inc. for its Back Forty Project in Menominee County.

Aquila's website said the Back Forty Project "is an advanced stage exploration project delineating a zinc and gold-rich volcanogenic massive sulfide deposit under an operating agreement between Aquila and HudBay Minerals Inc."

The project is located 12 miles west of Stephenson. Aquila owns a 49 percent interest in the project and HudBay owns a 51 percent interest, which HudBay can increase to 65 percent by funding and completing a feasibility study and permitting applications.

HudBay is the operator of the Back Forty Joint Venture and Aquila continues to provide technical support.

A Preliminary Economic Assessment is in progress and mine permit application submission is anticipated by mid year. The life expectancy of the mine is eight to 10 years of open pit operations.

In addition, Kennecott and Aquila are continuing exploration efforts in the U.P.

Clickner said the region's history is steeped in mining and a lot of people here have made money from the mines or related businesses, including tours and museums.

John Pepin can be reached at 906-228-2500, ext. 206.



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