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Web posted Monday, February 3, 2003

Fairbanks-based geological consultant prepares for busy 2003

By Patricia Jones
For the Journal

photo: focus

 
Curt Freeman, president and chief executive of Avalon Development Corp., examines a rock core sample taken from a platinum and palladium property in the Alaska Range last summer.
PHOTO/Patricia Jones/For the Journal

FAIRBANKS -- Thanks to a rebound in the metals market prices and more venture capital available for mining exploration, Avalon Development Corp., a Fairbanks-based geological consulting business, is preparing for a busy field season this year.

In fact, Avalon president and chief executive Curt Freeman has already started his recruiting efforts to line up geologists for work, starting in March and running through October, when the bulk of field data is collected for the company's clients.

"There's going to be a very significant shortage of geologists and engineers to work in the field," said Freeman, who has been advertising for several weeks for up to 30 workers needed for this summer. "After five straight years of dismal exploration efforts, the talent pool has moved on."

He's thankful for the current increase in business, but takes it in stride. Weathering the financial ups and downs of the mineral industry is an integral part of Avalon, a business that unites property owners with exploration and mining companies, while conducting the scientific work to discover a mineral deposit.

"We have good projects and good clients," Freeman said. "We weathered the really low cycle better than I thought we would."

In fact, the boom and bust cycle of mining caused Freeman to start the company back in 1985. After working as a geologist on several properties in Alaska for Nerco Minerals, Freeman and others in the Alaska division were laid off, due to the company's waning interest in Alaska.

"I had nothing better to do, so I got a business license and hung it out," he said.

His timing for a business start-up was impeccable. Fort Knox, a large, low-grade gold deposit, was discovered the prior fall, which drew attention to the Fairbanks Mining District, Freeman's geologic stomping grounds.

"That was a turning point for the mining industry," he said. "Each year we did a little more work."

Freeman operated Avalon Development out of his home-basement apartment for a number of years, enlisting the professional services of a few other geologists during the busy summer seasons. But, as interest in gold exploration in Interior Alaska continued to grow in the early 1990s, Freeman realized that he couldn't complete all of the work himself.

He opened his first office and began looking for permanent employees in 1994. Thanks to some long-term work for a number of clients, including Placer Dome, International Freegold and Barrick Gold, Avalon Development set up and maintained a year-round staff and an office complex in Goldstream Valley, near Fox.

Mineral exploration work in Alaska peaked about 1998, before low metals market prices began the most recent decline. At one point, Freeman had to lay off 15 people on one Saturday morning, due to a client's logistical problem with moving funds between two accounts.

The employees "took it better than I did ... it was not fun, definitely not fun," Freeman said, adding that he called a number of his contacts in the local geological community to find work for all the displaced workers.

Since then, the labor market for such geological field workers has changed dramatically, he said. With the deeply depressed metals market that started in the late 1990s and ran through 2001, many exploration geologists left the field or found work for governmental agencies. That's because most mining companies and prospecting firms cut their exploration budgets nearly to zero, Freeman said.

In addition, Freeman has observed a decline in geology graduates, from the University of Alaska Fairbanks and other schools of mines in the United States.

"We need that younger blood," he said. "They offer lower labor costs, but they're also the people willing to go over the last hill late in the day. Those are the ones who make the discoveries."

Last year, he hired only about 15 workers for the summer season, in addition to Avalon's permanent staff of up to six employees. This summer, he anticipates a need for about 30 seasonal workers, not quite as high as the company's peak of 35 field employees.

Properties represented by Avalon fall into three categories: Gold and silver properties; base metals properties that offer copper, nickel, tin, lead and zinc; and Platinum Group Elements properties, which include platinum, palladium, rhodium, ruthenium, osmium and iridium.

Interest in PGE properties, which can be found in the Alaska Range and in Southeast Alaska, has grown in the last three years, Freeman said, and helped stabilize his company's workload when gold exploration was in the tank.

Avalon currently has listed on its company Web site 80 different properties available for acquisition in Alaska. An internal system evaluates and ranks prospects based on the stage of exploration, the historic geological information and the access.

Land owners do not pay for Avalon's representation, allowing Freeman the ability to select properties that hold genuine geologic interest. "We have no obligation to push land on someone to make a land owner happy," he said.

Patricia Jones is a freelance writer living in the Fairbanks area. She can be reach via e-mail at jonesy@alaska.net.

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