AIDEA signs deal to assist process plant for Niblack mine
The Alaska Industrial Development and Export Authority has signed an agreement with developers of the planned Niblack mine in Southeast Alaska to evaluate a mineral ore process facility in Ketchikan.
The Memorandum of Understanding was signed between AIDEA, the state’s development finance corporation, and Niblack Project LLC, a subsidiary of Vancouver-based Heatherdale Resources Ltd.
The Niblack project has been pursuing a plan to develop a multi-metals underground mine on southern Prince of Wales Island, and that includes shipping ore by barge to a plant near Ketchikan for processing.
Typically a mine developer would locate the ore processing plant near the mine, but the location being considered near Ketchikan, at an industrial site on Gravina Island, would allow the plant to take advantage of lower-cost hydroelectric power that is available.
If the plant were at the mine site electricity would have to be generated with diesel.
“The Niblack project has tremendous potential economic benefit to Southeast Alaska communities residents and businesses,” said AIDEA executive director Ted Leonard. “This is a unique opportunity to generate employment and economic activity on Prince of Wales Island and the greater Ketchikan area. We are pleased to work with Heatherdale in evaluating the responsible development of this project,” Leonard said in a statement.
The mine would produce a mixture of copper, gold, zinc and silver metals and would employ about 150, if developed. The mineral processing plant near Ketchikan would employ about 80, AIDEA said in a press release.
Niblack is a historic mine in Southeast Alaska, producing for several years in the last century. Heatherdale acquired the property and began a new round of exploration drilling in 2009, with the most recent drilling in 2012.
The company is now planning another round of drilling to prove up additional resources, with this work planned in 2014, according to Patrick Smith, president and CEO of Heatherdale.
The company in working to attract additional investment capital to support the 2014 drilling, Smith said. Following that the project could move to a pre-feasibility study.
“AIDEA’s involvement could be a great benefit to us,” Smith said in an interview. “The authority is looking at several alternative ways of helping finance the process mill including straightforward financing or a possible equity investment. AIDEA is also interested in infrastructure that could assist other users, he said.
Heatherdale’s drilling to date has identified 5.6 million tonnes of ore in a category indicated by drilling, at certain cutoff grades for the ore, and 3.4 million tonnes of ore in a resource category inferred by drilling at certain cutoff grades.
A tonne is a unit of measurement typically used in the mining industry that equals 2,200 pounds. A conventional ton is 2,000 pounds.
Tim Bradner can be reached at firstname.lastname@example.org.