Mining group eyes Livengood spot for potential large-scale gold mine - Fairbanks Daily News-Miner

FAIRBANKS — For more than a 100 years, miners have searched for and extracted gold from the Livengood area, and a team of industry veterans at Tower Hill Mines, Ltd. have plans to open the area’s largest mine yet. 

Tower Hill Mines has its sights set on Money Knob, an aptly named mound jutting up from a ridgeline overlooking the Livengood valley. A pre-feasability study published this year estimates an open pit mine could produce 6.8 million ounces of gold over 23 years.  

Rick Solie, Tower Hill’s investor and community relations manager, says developing an open-pit mine at Money Knob is still five to 10 years away, and there is still plenty of work to do.

Solie said the success of this mine largely depends upon the team at Tower Hill Mines. Tom Irwin has more than 40 years experience in the industry. Irwin was responsible for the engineering and project design at the Fort Knox Mine, and he was commissioner of the Alaska Department of Natural Resources under three governors. Karl Hanneman, who has 30 years mining experience, played vital roles in the permitting processes at Red Dog Mine and Pogo Mine. 

“We have the two guys who helped make two very successful mines,” Solie said. 

The trio of executives at Tower Hill Mines is confident the mine will succeed. The resource has been drilled with 783 holes, and there is no question there is gold beneath the surface of Money Knob.

Because gold mining is such an expensive operation, Hanneman says the mining operation must be optimized.

“We’ve done a whole bunch of work to prove there is gold,” Hanneman said. “Now, we’ve got to sharpen our pencils and figure out how to make this economically viable and environmentally sound.”

Irwin said Tower Hill is working with eight years of baseline environmental data, at this point. He said Tower Hill has involved all the regulatory agencies such as Alaska Department of Fish, Game, the Army Corps of Engineers and so on. 

“We don’t want any surprises,” Irwin said. 

Since 2013, a team of engineers has helped Tower Hill Mines bring its estimated capital expenditures down 34 percent and their operating expenses down by 28 percent.

While there are many challenges to starting a mine in the Last Frontier, the proposed mine’s proximity to Fairbanks, 70 miles, and it’s proximity to electrical utilities, 50 miles, are a plus.

Solie said the mine’s proximity to Fairbanks will not only make a daily commute possible by way of shuttle, it will provide work for Interior’s skilled workers.

Because of Pogo and Fort Knox Mines, the ancillary businesses that support the mining industry have already been established as well.

As Solie, Irwin and Hanneman move forward with engineering and optimizing the mine, they will be hoping the price of gold trends upward.

“We don’t have any revenue. Our funds come from risk financing so we don’t have a full-time staff,” Hanneman said. “There’s a lot of gold so it’s worth it.”