Two Southeast Alaska mines could get close to $300 million in state support under a bill moving through the Legislature.
Senate Bill 99 authorizes the Alaska Industrial Development and Export Authority to issue bonds for the projects. It moved out of the Senate Labor and Commerce Committee March 20 and awaits scheduling on the chamber’s floor.
Ken Collison is chief operating officer for Ucore Rare Metals, Bokan’s developer. At an earlier hearing, he told the committee rare-earth metals are needed for strong batteries and high-tech devices.
“For things like electric cards, hybrid cars, it’s critical. Because you have much smaller components, much lighter components. Same thing with military tech. It goes into aviation engines,” he said.
The metals are in short supply and federal officials are encouraging mine development.
The bill authorizes the authority to raise up to $145 million for Bokan through bonds. Another $125 million could go toward the Niblack mine and its ore-processing facility near Ketchikan.
Collison said mines need state support.
“The financial markets are such right now for the mining industry that it’s very tough. And this is going to show huge support from the state of Alaska. It’s going to make the financial markets and the rest of the mining community realize the state is open for business. This would be a big help for us in developing this project,” he said.
Bob Claus, who works for the Southeast Alaska Conservation Council, said the shortage of private financing should be a warning.
“The proponents of the project have not established that the potential mine is in any way a viable project, have not been able to attract private investment to their proposal and have not demonstrated that the mine, if developed, would benefit the communities on Prince of Wales,” he said in a letter to the Senate committee, addressing the Bokan mine.
“This bonding authority is a misuse of state funds to support a purely speculative and controversial project,” he wrote.
The funds were added to a larger bill making changes to an energy fund that’s also managed by the Alaska Industrial Development and Export Authority.
Anchorage Senator Lesil McGuire sponsored the measure. She supported amendments drafted by Sitka Senator Bert Stedman adding the Southeast mines.
The bill must pass the full Senate, as well as the House, before it’s sent to the governor.