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Five different companies have projects in the works that could mean hundreds of new jobs.
Estimates of the ore body’s size are growing larger as the results of test drilling are analyzed.
As of 2002, geologists estimated the deposit — dubbed the Duluth Complex — contained about 4.4 billion metric tons of ore laden with copper, nickel, platinum, palladium, gold and cobalt.
Now, the formation is believed to contain 5 billion to 6 billion tons of valuable ore produced in a magma extrusion millions of years ago.
“The value of that ore in the ground today is probably closing in on half a trillion dollars,” said Henry “Rick” Sandri, CEO and president of Duluth Metals Ltd., a Toronto-based corporation sitting on top of rights to an estimated 733 million metric tons of mineable ore southeast of Ely.
Duluth Metals’ exploration efforts continue, and Sandri said that by the time drilling is completed on the site, the company could uncover more than 1 billion metric tons of mineable ore, according to staff at the University of Minnesota’s Natural Resources Research Institute.
Earlier this month, Franconia Minerals Corp. released the results of an independent consultant’s analysis, nearly doubling the estimated size of an ore body it hopes to tap at Birch Lake. The site initially was expected to yield 100.4 million metric tons of ore; it now is forecast to produce 195.5 million metric tons.
The company also is exploring the Maturi Deposit, located farther northeast on the Kawishiwi River.
Metal commodity prices are soaring as a result of global demand, so companies are looking at hard work to recover the ore.
Franconia has stationed a barge on Birch Lake to drill rock samples from its bottom, 22 feet below. Based on the results of testing, the company is thinking about plans to sink a shaft into the shore and mine beneath the lake through tunnels. Most of the deposit is located between a depth of 1,600 and 3,000 feet.
With the environmental reviews and permitting requirements involved in the project, the company probably can expect to begin production by 2012 or 2013 at best, said Bill Brice, Franconia’s director of government and community relations.
The project, which could cost Franconia more than $600 million, would provide employment for an estimated 800 construction workers, plus 550 permanent mining jobs upon completion.
Brice said about one-third of Franconia’s profits probably would be evenly split between sales of copper, nickel and other mostly precious metals.
PolyMet Mining Corp. is furthest along with its plans to develop the Iron Range’s first copper-nickel-precious metals mine. The company expects to complete work on a draft environmental impact study by mid-August, according to LaTisha Gietzen, PolyMet’s vice president of government and environmental affairs.
A subsequent review before the preparation of a final Environmental Impact Statement probably will push back construction until early 2009, but Gietzen said the mine could begin operating as soon as 2010.
PolyMet already has acquired crushing and grinding facilities formerly used by LTV Steel Mining Co.
Before any of the projects can go ahead, would-be developers will need to successfully answer concerns that sulfides in the ore could contaminate water, resulting in acidic runoff.
But the potential economic benefits of these new mines remain enticing. PolyMet’s proposed open pit mine is expected to cost about $600 million to develop and probably would provide jobs for about 400 people.
