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Kinross pulls drilling project

Local officials concerned about jobs, economy

— Legislators and other area officials are up in arms over the federal government’s lengthy environ-mental review process that has prompted Kinross Gold Corp. to pull the plug on a project proposal.

After five years and more than $10 million invested into the review of an exploration project on 9,200 acres northeast of town, Kinross subsidiary Echo Bay Exploration announced Wednesday that it would withdraw its combined plan of operations.

“It was a difficult decision to make... It was costly and it was taking a very long time,” Kinross spokeswoman Deana Zakar said. “This allows the company to reorient its permitting efforts to other options.

“The company had to go in and look and the whole picture and determined they couldn’t justify continuing to spend money” on a process that has no end in sight, she said.

The proposal had started out as a plan to drill for gold in 14 holes, but Kinross later decided to expand the request to include more private, state and federal lands.

Echo Bay Exploration planned to drill up to 965 holes at 675 sites.

“We would have only sought mining operations if the exploration found anything,” Zakar said.

Under U.S. mining law, Kinross has the right to conduct mineral explorations on federal land, provided there are no significant environmental impacts.

This week’s decision will not affect production at the Kettle River-Buckhorn Mine, but with operations there tentatively scheduled to end by mid-2015, officials in Okanogan and Ferry counties are worried about economic impacts and future job losses.

Kinross employs 230 people and contracts with about 130 more, Zakar said.

“The economic aspect of a drilling program was certainly included as part of the EIS,” she said. “There would have been job creation to some extent, and of course spending as well.”

“The Kinross mine as a whole … it is a major impact on the city of Republic and their own budget, not just the people and the businesses,” Republic Mayor Jim Burnside said. “If we lose people and we lose businesses, it changes all we have to do for our water system, our lagoon system … it’s a domino effect that trickles down from the top to the bottom.

“It’s an ongoing battle. They are a major contributor to us, and we just dread the day they ever leave.”

Even contractors spend money locally on lodging and food, he said.

The city is trying to look to the future already, anticipating a loss of sales tax revenue that will force the city to adjust its budget.

City Council member Linda Hall said Kinross has also donated money to the Republic Police Department, city parks and school districts over the years.

“You just can’t even imagine the money, besides wages, they’ve put into this community just supporting them,” she said.

Meanwhile, the U.S. Forest Service has said it will stop the environmental impact statement process it was working on with the federal Bureau of Land Management and the state Department of Natural Resources.

Once the National Environmental Policy Act and State Environmental Policy Act processes were complete, the Forest Service estimated the draft environmental impact statement might have been ready for public comment by February 2016. Some time after that, the Forest Service was expected to issue a record of decision that would have allowed Kinross to start seeking permits to drill.

“The permitting process is ridiculous,” Burnside said. “This a proven safe mine, and I can’t even begin to tell you how many dollars were spent just to get the Buckhorn project on its way.”

Okanogan County Commissioner Jim DeTro said the regional Forest Service office is to blame.

“They are in bed with the environmentalists,” he said. “We’re not giving up at all. This is not over. They better be looking for us on the horizon.”

“The message needs to go out to the Forest Service about what they’ve done to us,” Okanogan County Commission Chairman Ray Campbell said.

Federal and state legislators have also indicated their disappointment, including U.S. Rep. Cathy McMorris Rodgers, R-Spokane.

“The closing of the Buckhorn operation is a prime example of federal regulations stifling innovation and job creation,” she said. “We must work to keep excessive regulation from hurting our local economy, and while it is essential we protect our environment, we must also ensure federal red tape stops killing jobs that are essential to our economy.”

“It’s a real sad state of affairs,” 7th District Sen. Brian Danse, R-Republic, said.

Rep. Joel Kretz, R-Wauconda, also had harsh words for the Forest Service.

“It’s a complete and total failure,” he said. “They don’t care. They don’t give a damn. It’s a total system failure.”

Not everyone is unhappy with Kinross’ decision.

“OHA welcomes the termination of the massive exploration proposal,” Okanogan Highlands Alliance Executive Director David Kliegman said. “Kinross/Echo Bay is facing the economic reality that its ‘blank check’ approach for unfettered exploration over an entire large block of lands was not going to be feasible if the agencies were going to seriously analyze the impacts.”

Kliegman said the plan of operations included day- and night-long drilling, and questions were raised during the environmental review regarding wetlands, water quality and more.

Okanogan Highlands Alliance has been critical of current mining operations near Buckhorn Mountain.

“The impacts of past exploration and current mining on Buckhorn cannot be looked at in isolation,” Kliegman said. “The process involves releasing contaminants that were tied up in rock into surface and groundwater. The purpose of our laws is to understand the impacts before actions are taken. It is essential that the agencies take a careful, ‘look before you leap’ approach to protect the land, water and wildlife.”

Meanwhile, Zakar said Kinross is reviewing other potential opportunities in the region that would not include federal land, but she was unable to share specific details.

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