Planned pipeline to supply electricity to Donlin Mine could have impacts from the YK Delta to Cook Inlet


a proposed mine site
The proposed site of the Donlin Gold Mine on August 19, 2017. (Katie Basile/KYUK)

If built, the Donlin Gold Mine Project in the Yukon-Kuskokwim Delta would be one of the largest open-pit gold mines in the world. Energy would be supplied by a gas pipeline stretching hundreds of kilometres across the state to Cook Inlet.

Sage Smiley of KYUK and Riley Board of KDLL have teamed up on both ends of this potential pipeline to tell this story.

Mile 315 – Crooked Creek

a labor camp
Donlin's labor camp. (Dean Swope/KYUK)

In the hills outside the village of Crooked Creek in the middle of the Kuskokwim River there is gold – an estimated 34 million ounces of gold, the weight of five large blue whales.

It will take a lot of work to get it out of the ground.

Kristina Woolston is vice president of external relations for Donlin Gold, which plans to develop the mine. She explained the mining process during a meeting of the Alaska Senate Resources Committee in early April.

“Donlin Gold is a refractory ore, which means it has microscopic particles trapped in arsenopyrite and some pyrite. So it requires a very energy-intensive process to extract the gold,” Woolston explained. “We will be milling about 59,000 tonnes a day; (that) requires a lot of energy.”

The Donlin Gold Project site is located on land owned by Alaska Native Corporations established under the Alaska Native Claims Settlement Act of 1971. Surface rights are held by the Kuskokwim Corporation and subsurface rights are held by the regional Calista Corporation.

Thom Leonard is vice president of corporate affairs at Calista. He said the project went through several different ideas on how to run such a difficult-to-access site.

“One of the first ideas for the project was that it was so remote that Donlin had to transport everything on barges. Not just construction materials, but also fuel, diesel fuel for all the equipment, as well as power and heat,” Leonard said.

But fears about a possible increase in barge traffic led to resistance among communities along the Kuskokwim.

“We've heard from shareholders and residents all along the Kusko(kwim), 'Hey, that's a lot of barges. That concerns us.' So we reminded Donlin of those comments,” Leonard said. “They went back through everything and said, 'Hey, we can look at building a natural gas pipeline. And that will cut the number of barges on the river in half.' So we've taken the comments from people who have concerns or are opposed to the project and learned from them.”

a map
The proposed route of the natural gas pipeline that would power the Donlin gold mine was submitted to the State of Alaska in late 2013. (From the Alaska Division of Oil and Gas)

The project is supported by many people in the village of Crooked Creek, which is less than 20 kilometers from the proposed mine site, as well as by the Calista Corporation.

But many other people in the YK Delta are still not entirely happy with the plan, even if the proposed boat traffic is reduced. In recent years, many traditional Indian councils and organizations have withdrawn their support for the project due to various environmental concerns.

“It distorts our traditional values ​​to fit the mold of a corporate infrastructure,” said Sophie Swope, executive director of Mother Kuskokwim, a nonprofit tribal consortium founded in 2022 as a countermovement to the Donlin project.

“The fact that there's going to be a 315-mile pipeline from Cook Inlet to Crooked Creek means it's going to go by so many rivers. And of those many rivers, we don't know how many actually carry fish,” Swope said. “And I think that's a big shortcoming.”

Mile 0 – Cook Inlet

In the Cook Inlet region, the discussion is more about the price of natural gas, particularly what will happen to residential utility costs when Donlin starts buying up the gas.

Donlin says his pipeline will use about 20 billion cubic feet of natural gas annually. To put that number in perspective, that's about the amount of gas every single residential household in the state uses in a year.

That demand concerns energy consultant Mark Foster. Foster wrote a report for the Homer-based environmental nonprofit Cook Inletkeeper on Donlin's potential impact on electricity prices.

His conclusion: Donlin's proposed energy use could increase rates for Southcentral customers by $265 per year.

That's because Donlin would buy gas from Cook Inlet, which is already a hot topic as utilities threaten to expire their gas contracts and lawmakers rush to propose policy solutions.

“The Donlin mine has a large natural gas demand based on the documentation it provides to potential investors, and that demand, if it came from local Cook Inlet gas, would be a significant block of demand,” Foster said. “Given the limited reserves we see on the horizon, one can imagine that their demand would drive the price up significantly.”

Not everyone agrees with Foster's report. John Boyle, commissioner of the Alaska Department of Natural Resources, said it's premature to worry about Donlin's demand if utilities can't fulfill their contracts in the short term.

“Given that existing demand is not projected to be met by future supply – unless new investment, drilling and production take place – it is fanciful or, I guess, illogical to believe that the Donlin Mine will somehow be able to come in and release over 20 billion cubic feet worth of gas and thereby only exacerbate the overall energy supply imbalance.”

Boyle agrees that Donlin would use a lot of gas, but he actually believes it would lower prices. He said industrial customers such as mines tend to provide stability to local utilities.

“The more demand they have from industrial and residential consumers, the better they can cover and distribute those costs,” Boyle said. “The more costs those industrial consumers bear, the lower the cost to each individual consumer.”

According to the DNR, members of the Golden Valley Electric Association in Fairbanks saw their electric bills cut by 7% after the Fort Knox Mine came online. And it said that electricity customers in Juneau have saved $70 million since 2009 thanks to the Hecla Greens Creek Mine's investment in hydroelectric power. These figures come from the Alaska Miners Association.

During the Senate Resources Committee meeting in April, Woolston and Donlin said they believe the mine will have a positive impact on the gas market, but added that Donlin shares the same concerns about gas in Cook Inlet as the utilities and the state.

“So, like everyone else, we are anxiously watching the supply in Cook Inlet and seeing what the solution will be,” Woolston said.

The lawsuit

The pipeline is not yet a done deal. Its approval is being contested in a civil case currently before the Alaska Supreme Court.

The state granted a right-of-way permit in 2021 for the pipeline, which crosses about 200 miles of state land.

But four tribes from the Yukon-Kuskokwim Delta region – the Orutsararmiut Native Council, the Chevak Native Villages, the Native Villages of Eek and Kwigillingok and the conservation group Cook Inletkeeper – are fighting back in court.

“Unless you look at the entire project, you won't really understand the impact on the public interest,” says Olivia Glasscock, an attorney with Earthjustice, which represents the four tribes and the environmental nonprofit.

The main argument of the lawsuit is that the state only considered the pipeline itself when approving it, not the impacts of the entire project. Glasscock said the two are inextricably linked.

“What they missed is the fact that the pipeline, the use of state land, is for this major project at the end,” Glasscock said. “There is no other use planned for the pipeline. It is only intended to be maintained for the life of the mine. It would not be built if the mine was not operating. There are no other projects planned related to this pipeline, even though it has additional capacity.”

Oral arguments in the case before the Alaska Supreme Court are scheduled for late July.