Understanding a Fairbanks mining exploration project creating tension among residents

Published: Aug. 20, 2021 at 5:34 PM AKDT
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FAIRBANKS, Alaska (KTVF) - Fairbanks is a town founded on gold mining, but a recent project to search for gold in the area is causing alarm among some residents.

Felix Gold and Milrock Resources are in a strategic partnership to explore for gold in the Fairbanks area. They are focusing their geological research in the area around Ester Dome, Treasure Creek near Old Murphy Dome Road, and land between the Steese and Elliot Highways. It is the exploration planned near Ester Dome that is causing concern among some residents.

Stephanie Haskins is one of the owners of Black Spruce Brewing Company in Fairbanks. She says she lives near Ester Dome and often recreates on the trials there. “I think given that this is a highly residential area that this would have pretty immediate and detrimental impact to those of us who are living in the area and those of us who live there as well.”

However, not all residents of the exploration are against the project. Sven Haltmann is the owner of Arctic Winter Adventures which is located in the Treasure Creek area and provides northern lights viewing and dog mushing trips to customers. He said that he initially was against the project but changed his mind.

“They don’t have the 1970, 1980 attitude no more,” Haltmann said. “They don’t elbow their way through no more and say, ‘hey you are sitting on a huge gold deposit, we are going to dig here. We don’t care if you live here, we don’t care about your business.’ Mining of 2021, I’ve seen now, has a different approach.”

Mining exploration project

The mining exploration project being conducted by Felix Gold and Milrock Resources is taking place in historical mining areas of Fairbanks.

According to Dave Larimer, the Vice President of Exploration at Felix Gold they are using historical data as well as soil samples to learn more about the geology under Fairbanks. “Our goal is to understand and find economically viable gold resources in Alaska, and specifically in the Fairbanks area. Our end state would be finding a deposit and understanding a deposit that could be economically extracted for money at the end of the day.

One of the ways they are doing this is by taking soil samples. “Our current operations that we have been doing the past couple months is a basic soil sampling campaign. It has been focused on our Treasure Creek area,” Larimer said.

So far the company has conducted over 2,000 soil samples in the area and are just now starting to get the data back. Larimer says they are using local contractors to conduct the sampling in the area. To retrieve a sample, a two man crew uses an auger to drill five feet into the soil and then collect some of the dirt. They then bag up the dirt and label it. The hole is then covered before the crews move to the next sample site.

They use the data from the samples to help with their analysis of the area. They are also using historical mining data to try and better understand the soil and if it is even feasible to mine the area.

Felix Gold is a mining exploration company listed in Australia, but Larimer said the company is Alaskan and employs Fairbanksans. “Felix Gold Alaska is our subsidiary company specifically designed for exploration activities here in Alaska. We are a parent company of Felix Gold Limited,” Larimer said, adding that they are a small company with only three employees. He said even their name comes from Fairbanks, “We get our name Felix Gold from Felix Pedro - we thought that was a great homage to Felix Pedro who originally discovered the gold in the Fairbanks area that lead to the gold rush and basically established Fairbanks as a city.”

Felix Gold is partnered with Milrock Resources, a Canadian company that also operates out of Alaska.

Larimer said the goal of the companies is to secure exclusive mining rights, explore the area, and if they find a deposit, let a bigger company come in and work to establish a mine.

“We are not a mining company. We do look to understand what’s there,” Larimer said. “The ultimate goal for us as an exploration company is to find and economic deposit that could be mined, but there is a huge probability game.”

Even if they did discover a significant deposit, Larimer said the a mine would be years if not decades away.

Alaska Mental Health Trust Authority

Much of the land that Milrock and Felix have staked claims on is state land, but they are also looking to get exclusive rights to mine the areas from the Alaska Mental Health Trust Authority. The Trust Authority is a state agency that gives grants to help with mental health. According to Allison Biastock, the chief communications officer for the Trust, they give out around $25 million in grants each year.

“We have around a million acres of land that we were given to the Authority for the sole reason of generating revenue,” Biastock said, adding, “We are completely self-funded, we do not use state general fund dollars. Our activities are funded through those assets that I mentioned that include our cash assets.”

One example of how they generate revenue is the Fort Knox gold mine outside of Fairbanks that is partly on Trust Authority land. Biastock said that since it was opened they have gotten $20 million in revenue from the mine.

Felix Gold is hoping to secure a mineral lease from the Trust Authority to have rights to mine on Ester Dome and other areas north of Fairbanks.

Wyn Menefee is the executive director for the Trust Land Office, and said a mineral lease provides the “full mineral rights to explore a develop” an area of Trust land. He clarified that even if they grant the rights, a mining company still has to work with state and federal agencies to be able to actually explore and mine an area.

“Felix Gold has applied for a mineral lease. It is the very initial stage before any mine exploration or mine development can occur,” Menefee said.

After a company applies, Menefee said they review the application to see if they will even entertain letting the land be used for mining. In the case of the land Felix Gold applied to use, Menefee said that the land was specifically given to them because of its mineral potential. After they decide they are interested, the Trust then get approval by the board before moving to a best interest comment period where the public can comment about concerns they have regarding the proposed land use.

The Alaska Mental Health Trust Authority recently closed the comment period for the Felix Gold proposal. Menefee said they notify the public, which then has 30 days to comment on the proposal. They have received over 500 public comments that they will review before they decide whether or not to approve the mineral lease to Felix Gold. Menefee said they could affirm the decision to let them use the land, modify the decision, or deny the decision. They hope this is completed in the coming months.

“We have to give it due diligence to go through all those comments, to evaluate them, see the impact of those comments and then write up the next decision,” Menefee said.

Community concerns

While Felix Gold is not currently mining or even doing drilling in the Ester Dome area, and the Trust Authority is still deciding whether they will allow them to use the land, many in the community are still concerned about what exploration could lead to.

Monique Musick, who is the president for the Ester Community Association said, “If they find as much gold as they potentially could and sell off this discovery to a large mine, we would be talking a Pogo sized (mine) verses the smaller operations that we currently coexist with.” The Ester Community Association issued a public letter opposing the mineral lease from the Alaska Mental Health Trust Authority.

Some of the biggest concerns residents have are not with the geologists looking for gold, but what could happen if they find it.

“Felix Gold is doing the exploration, they are the geologist, they are looking for the gold, they aren’t the ones that would be mining it,” Musick said. She added there is concern that if a mine were developed the property values could decrease, recreational areas be damaged, and an increase in traffic in the area would be possible. Ester Dome has miles of trails including the famed Equinox Marathon Trail, and some residents are worried that a mine could destroy the area.

Felix Gold’s Dave Larimer responded to some of those concerns saying, “I use those trails, all of our staff uses the trails, I love that area. We are very environmentally and socially conscious.”

Another concern many in the community have is with how the Mental Health Trust leases.

“What’s concerning with the Mental Health Trust lease is it doesn’t differentiate between looking and mining,” Musick said. She also had concerns about how the community was notified of the public comment period, saying she felt that they should have had a longer notice.

While many in the community are worried about the mining exploration, some residents have changed their minds. Sven Haltmann owns Arctic Winter Adventures, a winter tourism business that owns land in the Treasure Creek area of exploration. He said he initially was against the project.

“A mine next to my door would not only destroy my back yard, it would kill Arctic Winter Adventures. I could not promote unobstructed northern view to my guests for northern light viewing with an active mine next door,” he said.

This summer, Haltmann was approached by Milrock and Felix Gold who asked if they could operate their exploration out of the yurts he owns and store equipment on his land. “I was torn, I was really torn. I did not want my back yard to become a big mine, but I also wanted to help them out because all these people that work for Milrock are local Fairbanks guys,” Haltman said.

However, once he talked with them he changed his mind. “I had to do some soul searching... what I really wanted... and in order to come up with a good decision, I had to talk to them. What exactly this would all entail, what kind of mining was taking place,” he said. Now he said that he is friends with them and they are even helping to build additional dog mushing trails in the area. He encourages anyone with concerns to just talk with the company.

Grier Hopkins is an Alaska State Representative for House District 4 that includes most of the area of the mining exploration. He said he grew up next to a mine in the area and while he is not against mining, he does have some concerns especially about the way the Trust Authority handled the notice of the public comment. He also said he has heard from many constituents who are against the project.

“The vast majority of the outreach I have received and have heard from has been in opposition and concerns about the impact it would have on their lives, their property values, their recreational efforts, whether it’s trapping or mining or biking or hiking,” Hopkins said.

He also encouraged the community to be engaged and reach out on every step of the process. Community members will have a chance to share there concerns and talk with Felix Gold on Saturday, August 21 between 1 p.m. to 3 p.m. at the Ken Kunkel Community Center. Felix Gold is holding a community meeting as an effort to hear more from the community and educate them on the proposal. They are encouraging everyone to come out and talk with representatives to have their questions answered.

Musick said that even if the Alaska Mental Health Trust Authority doesn’t grant the lease, Felix Gold still can explore on lots of state land and they plan to stay active and make sure their interests are heard at every step of the process.

We will continue to follow this story as it develops.

Story updated: An earlier version of the story incorrectly stated that the Alaska Mental Health Trust does not give out $25 million in grants each year. It should have said they do give out $25 million in grants and was corrected to reflect that.

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