Alexco a peaceful neighbour

Alexco a peaceful neighbour Over the last few months we have been reading the several letters to the editor from residents of Keno City concerning our Keno Hill Silver District Project, and would like to take this opportunity to set the record straight

Over the last few months we have been reading the several letters to the editor from residents of Keno City concerning our Keno Hill Silver District Project, and would like to take this opportunity to set the record straight before the facts are completely lost.

Regarding our purchase of the assets of UKHM and our environmental obligations at Keno Hill: Alexco Resource Corp. purchased the assets of the historic abandoned Keno Hill mining district in a structured sale as directed by the Yukon Supreme Court in 2006.

Alexco paid approximately $400,000 to acquire the assets of UKHM, plus we committed and immediately placed $10 million in cash in a trust fund to offset taxpayers’ future costs of cleaning up the district as planned by the federal government.

We also agreed to reduce, at our risk, ongoing taxpayer costs for interim water treatment and care and maintenance by approximately 30 per cent, or about $1 million a year.

And we further agreed to contribute with Ottawa to the costs of developing and engineering the district closure plan, as well as granting a royalty to the federal government from any future mine production from the district, or the sale of any of the historic assets.

To the extent that residents of Keno City continue to imply we were simply handed a large environmental cleanup job, which will be entirely funded by Canadian taxpayers, could not be farther from the truth.

We not only have “skin in the game” in the form of at least $10 million, but we are working hard to solve the environmental issues at Keno Hill, and do so in a regulatory framework that now ensures residents and visitors are protected from physical hazards and contaminated water sources.

Regarding involvement of Keno residents in district closure planning and Bellekeno mine development: Both with government and on our own, we have met numerous times with Keno City and other local residents to receive their input and suggestions and we intend to continue to do so as we develop the Keno Hill district closure plan for submission to the Yukon Environmental and Socio-economic Assessment Board next year; the request of Keno City to the governments to hire a technical expert to assist them in reviewing our plans is laudable, but the matter of government funding for Keno City to hire a technical adviser is not in our control.

In response to concerns raised during the Yukon Environmental and Socio-economic Assessment Board review of our proposed Bellekeno mine, Alexco hired an independent facilitator (chosen by Keno City) to conduct meetings and attempt to develop a formal communication protocol between Keno residents and Alexco for all matters related to our proposed development.

Over an eight-month period in 2009, we met 13 times with local Keno residents and six of these meetings were led by the independent facilitator.

We are very close to developing a mutually agreeable communication protocol, and we continue to extend our offer to restart discussions which were terminated by Keno residents approximately three months ago.

Regarding mitigation of potential mine impacts: Alexco recognizes Keno City’s importance as a tourism destination, and from the outset we believe we’ve put forward a concerted effort, in the form of mitigative measures, to minimize potentially negative impacts from our Bellekeno mine-related activities on Keno City.

For example, we are building a bypass road around Keno to avoid heavy traffic through town. We will be using treated mine water from one of the historic adits as makeup water to our mill, to avoid any concerns from local residents on drawing down the local town aquifer.

We will be implementing noise abatement and dust suppression strategies that have proven successful elsewhere. We will limit our ore haulage and crushing operations to day shift only.

We have moved the waste-rock-storage site, originally planned for the Onek waste-rock dump, to the mine-portal site after concerns were raised by some Keno City residents, and will move this rock back underground once mining ceases.

Regarding lot 960, titled to Alexco located in Keno City: It is true Alexco owns this, the largest titled property in Keno City.

This lot was part of the assets we acquired in the original transaction.

To our dismay, after purchasing the property through the court, we found we have inherited a historic ownership dispute that was a result of decisions more than 25 years ago before Alexco became active in the district.

We have offered various ideas to resolve this issue, and we remain committed to finding a solution that works for all of us.

Some residents continue to raise an issue that we are planning to route roads over homes that exist on our lot 960. We should be clear that we never did plan to develop a road over homes in Keno City, and Keno residents are well aware of this.

Regarding the future and our hopes for Keno City: We do understand that the return of mine-related activity to a historic mining district after nearly 20 years absence can be seen as a threat by people who have become used to the fact that mining had left the region Ð they would naturally have thought it was gone for good.

We are, however, certain that our activities will result not only in an economic revitalization of the Keno area, but will bring tangible benefits to local tourism as well as responsible environmental cleanup of the entire district including contaminated areas in and around Keno City.

It is our wish to live with all local residents as peaceful neighbors in the region for many years to come.

Clynt Nauman, president, CEO

Alexco Resource Corp.


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