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MORE QUESTIONS THAN ANSWERS
In June, the United States and other countries established the Minerals Security Partnership (MSP) to bolster critical mineral supply chains. The goal, according to the announcement made at the Prospectors and Developers Association of Canada convention, is to ensure that critical minerals are produced, processed, and recycled in a manner that supports the ability of countries to realize the full economic development benefit of their geological endowments.
The need for critical minerals, which are essential for clean energy and other technologies, is projected to expand significantly in the coming decades. Members of the MSP—which include Australia, Canada, Finland, France, Germany, Japan, South Korea, Sweden, the United Kingdom, the United States, and the European Commission—are hoping that this partnership helps to catalyze investment from governments and the private sector for strategic opportunities that adhere to the highest environmental, social, and governance standards.
“The Biden administration has a bold, aggressive agenda when it comes to transforming the electric grid and transitioning to electric vehicles, and given the need for raw materials to ramp up production of alternative energy sources in the way that the president has articulated, it should be no surprise that the administration is looking to all available resources to meet those immediate needs,” says Deantha Skibinski, executive director of the Alaska Miners Association. “This includes our allies, which is why they claim that the Minerals Security Partnership is necessary.”
While it makes sense that national governments are paying attention to how and where these minerals are obtained, mining and development interests in Alaska question how the MSP will help the state.
What Are Critical Minerals?
“Everywhere we turn, we hear about critical and strategic minerals—it’s almost a generic term at this point,” says Skibinski. “A rule that Alaska miners live by when it comes to minerals is, ‘Critical means you need it, and strategic means you don’t have it.’ And we have a problem with both.” 2630 Van Horn Road
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While the MSP is focused on critical minerals, there is some concern that the minerals that fall into this category should not be the partnership’s only focus.
“Everyone is aware of widespread supply chain issues on all fronts. Major automakers are producing $90,000 vehicles that don’t have poweradjusting seats because they can’t get the computer chips necessary to build that part of the vehicle,” Skibinski says. “Many of the supply chain issues boil down to the availability of minerals, and the information that has risen to the top implies that we are only facing a shortage of rare earth minerals like gallium, beryllium, et cetera.”
The United States Geological Survey (USGS) updated a critical mineral inventory late last year, classifying fifty minerals as “critical.”
“However, the USGS chose to overlook copper, gold, silver, and more, with the rationale that the United States has an adequate and secure supply of these minerals in domestic deposits,” Skibinski explains, “but it ignores that said supplies are still in the ground, and the projects proposing to mine them are being told ‘no’ through the federal permitting system.”
Case in point, she says, is copper needed to meet alternative energy goals. “The United States does not produce enough copper for today’s needs, and that shortage is going to intensify. It would seem prudent that critical mineral inventories and programs include what Americans truly need and not just what is novel or popular,” Skibinski says.
Recent setbacks in mine development seem to work at cross purposes to the goal of increasing domestic production of important minerals, according to Skibinski. This includes the development of the Pebble Mine in Alaska, which had its final permit denied in 2020; that decision is currently under appeal. The US Department of the Interior cancelled leases for the Twin Metals nickel and copper mine in Minnesota in 2022, and in March 2021 the US Forest Service rescinded its Environmental Impact Statement and draft record of decision for a land exchange to allow Resolution Copper mine in Arizona to move forward.
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While Alaska currently has five large metal mines that supply the world with gold, silver, zinc, and lead, it is still in the developing stages of identifying and advancing projects to pursue copper, graphite, molybdenum, cobalt, and other minerals.
“Owners of these projects have done drilling and analyzed surveys of their mineral holdings; they have done baseline environmental studies, and some have looked into engineering and mine plans,” says Skibinski. “However, it remains to be seen if the federal regulatory system will provide for bringing these important domestic mineral sources online.”
She also notes that rare earth elements and critical minerals generally exist as a byproduct of a more marketable mineral.
“For instance, there are promising qualities of cobalt and gallium at the copper deposits in the Ambler Mining District. If the copper operation does not move forward, mining for the critical minerals the administration is interested in simply won’t be feasible,” Skibinski says.
“There is a new mineral source being produced at a copper mine in Utah only because the copper mine exists in the first place,” she adds. “To obtain these minerals, we have to look at the realities and the economics of mineral production; otherwise, we will continue to import them from China, where they have that figured out.”
Mixed Messages
While details of the MSP are not yet available, the overall reaction of Alaskans has been skepticism tempered slightly with hope.
“Production of minerals from allied nations isn’t necessarily a bad thing, as the projections on demand are so staggering it really may be an ‘anywhere we can get supply’ situation,” says Skibinski, “but we should look to produce minerals in America first, where we know that mining is conducted with the highest environmental, labor, and safety standards in the world, and the economic and community benefits can be realized by our citizens.”
Leila Kimbrell, executive director of the Resource Development Council for Alaska (RDC), agrees that efforts to expand and improve mineral security are always welcome, and it’s important to make American sources a priority.
“We know that Alaska's mining industry is held to some of the highest environmental standards in the world, and we should continue to responsibly develop our resources rather than outsource them from places we know have little to no regulatory protections, be it environmental or labor,” says Kimbrell.
“We hope that the MSP leads to prioritizing domestic production rather than outsourcing the necessary supply of these minerals to the partner countries listed in the MSP,” she adds.
That said, Kimbrell adds that the RDC remains concerned about the mixed messages it feels it is getting from the current federal administration.
“We are specifically concerned that— similar to President Biden’s executive order earlier this year supporting increased domestic production of critical minerals—this is merely lip service, as we have experienced efforts to delay and even proposals to preemptively veto many of Alaska's responsible resource development projects,” she says.
Kimbrell notes that many current and planned Alaska projects should be prioritized as minerals and metals
essential to producing cleaner energy technologies. These include the graphite deposit near Nome; deposits of cobalt, germanium, gallium, palladium, lead, gold, silver, and copper in the Ambler Mining District; the rare earth element minerals known to exist at Bokan Mountain on Prince of Wales Island; and the copper deposits known in the Pebble project.
Rebecca Logan, CEO of the Alaska Support Industry Alliance—a nonprofit trade association made up of more than 500 businesses, organizations, and individuals that provide products and services to the oil, gas, and mining industries, and represents more than 35,000 Alaskan workers—says her group has reservations as well.
“My gut feeling—and I hate to be cynical—is that the MSP may mean spending more time supporting other countries in their efforts to develop these minerals and less time focusing on the United States. It is a pattern that this administration is following on almost everything,” she says.
One exception that Logan sees is the stipulation in the Inflation Reduction Act, signed in August, that a high percentage of metals needed for electric vehicles must come from US manufacturers and producers. However, one of the major sticking points is that the Inflation Reduction Act fails to address federal permitting reform.
“This agreement is only going to drive investment if the opportunity is there,” she says of the MSP’s objective to catalyze investment from governments and the private sector. “One of the challenges facing the development of oil, gas, and mineral resources is that the regulations are getting more restrictive and not less. There have to be policies in place that encourage companies to explore and develop these resources long before any kind of investment can be expected.”
Kimbrell describes the situation as putting the spending cart before the permitting horse. “While the administration is saying a lot of the right things about what needs to happen, it seems that we’re often more comfortable supporting our neighbors in their development of critical minerals than focusing on what we’re doing here,” she says.
While prioritizing mineral development in other countries helps to chip away at the minerals shortage, Skibinski is concerned that it could deny Americans and Alaska the economic opportunities that come from mining. According to the 2022 Economic Benefits of Alaska’s Mining Industry report prepared by McKinley Group, more than $1.1 billion is spent on goods and services by Alaska’s mines and advanced projects, including $640 million spent with 400plus local businesses; $44 million in local tax revenue to support services like libraries, road repairs, and public safety; $83 million in state government revenue for services like education, highways, and airports; and $161 million in royalty payments to Alaska Native corporations.
The mining industry also contributes roughly $4.4 million to approximately 250 Alaska nonprofits, including $800,000 to civic, business, and industry organizations in Alaska through sponsorship and membership fees and more than $1.1 million contributed to UAA and vocational schools.
The industry provides roughly 10,800 total direct, indirect, and induced jobs and $985 million in wages statewide, and mining employees live in approximately ninety-five communities throughout the state.
“I worry that the MSP will prompt decision makers within the federal administration to prioritize mining in other countries in an attempt to walk a line between getting the minerals we must have but not developing ones in America under the name of conservation,” says Skibinski. “This would help them obtain needed minerals from places we would consider friendly and responsible, and they don’t risk upsetting the organized groups that administrate opposition to mining projects in our country.”
Ultimately, the head of the mining association is hopeful that the MSP promotes more mining overall. “This doesn’t have to be an either/or—it’s ‘and,’” Skibinski says. “We need to work closely with allies on finding secure, responsible supplies, and we absolutely must also encourage mining at home that develops our vast resources under world-leading environmental and labor standards.”
Deantha Skibinski Executive Director Alaska Miners Association
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