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Company wants to build gold mine next to Donlin, but will need to find gold first


A potential gold mine is being explored in Western Alaska, just north of the Donlin Gold Project. But the company exploring the area says a mine actually being developed there is far from guaranteed.

The mine project is called “Flat Gold.” It consists of 92,000 acres of land located between Holy Cross and McGrath, just 25 miles north of the Donlin Gold Project.

Tectonic Metals is the company that will be exploring Flat for gold. CEO and President Tony Reda says there are key differences between Flat and Donlin.

“We’re years, decades behind where Donlin is. We don't even know if Flat is going to be a mine,” Reda said.

But if Flat does become a mine, Reda says it could benefit from being so close to Donlin.

“We're not hanging our hat on Donlin moving forward, but obviously, given the scale and the magnitude of that project, I would envision not just Flat, but the entire area benefiting from improved infrastructure, roads, power being brought in.” Reda said.

Flat could also benefit from a gas pipeline, which Donlin got approval in August from the state to build. The pipeline would stretch from Cook Inlet to Crooked Creek at the Kuskokwim River headwaters. Several tribes in the Y-K Delta are challenging the state’s approval in court.

Doyon, Limited, a regional Alaska Native Corporation owns the land where the Flat Gold Project is located. Doyon’s CEO and President Aaron Schutt says despite Donlin and Flat being so close together, they would have different potential environmental impacts. While Donlin is in the Kuskokwim River watershed, Flat is not. Instead Schutt says water in Flat flows into the Iditarod, Innoko and Yukon Rivers.

Any potential partnership between Flat and Donlin would be years or decades into the future. For now, Flat is in an exploration phase. The mineral exploration company, Tectonic, will be determining if enough gold exists to build a mine there. Reda says this process can take a very long time.

“On average, the lifecycle of a project going from say discovery into production is 20 years,” Reda said.

Tectonic was founded in 2017, and is based in Vancouver, Canada. In its short history, Tectonic has explored seven sites for gold. None have become mines yet.

“In our industry, the norm is that most of these projects do not make it,” Reda said.

But there is evidence that suggests Flat contains gold. According to Tectonic, the precious metal was first discovered there in 1908. After which, Tectonic says an estimated 1.4 million ounces of gold were extracted through placer mining. Placer mining separates gold from sand or gravel rather than drilling into rock.

In the next few weeks, Reda says Tectonic will send geologists to sample and analyze the rock surface in various areas of Flat. If those samples prove promising, he said that the company could move on to drilling in the coming years. Then, the project could employ dozens and up to over a hundred people. Reda said many would be local workers.

“We intentionally incorporated local hiring preferences, Doyon organizations, local villages,” Reda said.

The land-owner for the project, Doyon, does not stand to benefit much financially from this deal unless enough gold is discovered at Flat for a mine to be built. At that point Doyon gets royalties on any gold that is extracted. CEO and President Aaron Schutt said Flat may never get to that point.

“In rural Alaska, you have to discover quite a sizable resource whether that's gold or any other mineral in order for it to even potentially become a mine,” Schutt said.

Schutt said, by the end of this deal, Doyon would at least learn more about its lands.