Alexco gets green light to open mine

Alexco Resource's Bellekeno mine should open by mid-October, following the Yukon Water Board's decision last week to licence the project.

Alexco Resource’s Bellekeno mine should open by mid-October, following the Yukon Water Board’s decision last week to licence the project.

Already, approximately 155 workers are on site, two kilometres from Keno City, preparing the underground lead-and-silver mine and accompanying mill for production.

Once production starts, the mine is expected to employ 120 workers and to invest more than $25 million annually in labour, materials and supplies in the Yukon. And if the company’s plans succeed, the historic mine district will be bustling with activity for many years to come.

Alexco will use a conventional floatation mill to separate galena from dross. Twenty-tonne trucks will then haul the silver-lead concentrate to Skagway’s port.

The company aims to begin producing 250 tonnes per day, and to later ramp up daily production to 400 tonnes. To put this in perspective, the Faro mine produced as much as 20,000 tonnes daily, while Yukon’s only operating hardrock mine, Minto, has a mill that is roughly eight times the size of what’s being built by Alexco.

“It’s a small-tonnage, high-grade mine,” said Rob McIntyre, the company’s vice-president.

Bellekeno is expected to have a life of just three and a half years. But the mine is just the beginning of Alexco’s plans for the district.

“That three and a half years was just needed to get the mine started,” said McIntyre. “We know with a high degree of confidence we can do the same thing with other deposits.

“This is just what it took to get things going on the hill. All the old timers say, you guys will be there forever.”

Mines operated in the district for nearly 70 years, until United Keno Hill Mines’ operation closed in 1989. Over that period, miners extracted more than 217 million ounces of silver.

But none of these operations had the advantages of today’s technology and geological theories. “They never really had a long-term picture,” said McIntyre. “They just followed the veins.

“I think we’ll be there for a very long time.”

The company has already found promising extensions to Bellekeno. And it has its fingers in other nearby deposits. The surrounding district is home to 32 mines that produced ore.

Even work to lay a parking lot has uncovered glimmering galena. “Suffice to say, just about anywhere you go, it’s highly prospective from a geological point of view,” said McIntyre.

The company found a clever way to get its foot in the door of the historic silver district and begin earning money: it secured the federal contract to cleanup the mess left by bankrupt mining companies of yesterday.

Cleanup revenues helped finance Alexco’s exploration work. And its exploration work allowed the company to persuade Silver Wheaton Corp. to front $50 million (US) to help build Bellekeno.

Silver Wheaton serves as a middleman in the silver business. It buys the metal below market prices, through long-term contracts, and then sells silver to major industrial clients at a mark-up.

McIntyre envisions Bellekeno as simply a starter mine. It ought to provide a steady revenue stream that will help the company with its hunt for something big.

“We’re looking for the 100-million ounce deposit. That’s the ultimate target for the district. It’s another one of those very big deposits. So if we can mine some of the small, sweet-spot, high-grade deposits like Bellekeno, and provide cash for the company to explore and find the big one, that’s the strategy overall.”

The mine will initially consume several megawatts of power from Yukon’s grid. Work is now underway to unify Yukon’s two power grids, but the Pelly-Stewart line will only be needed when Alexco ramps up to producing 400 tonnes daily, said McIntyre.

The project won’t require power from the expansion of the Mayo hydroelectric project, he said. “Mayo B isn’t for us. It’s for the next guy.”

Another reason for Alexco’s success is found in the supportive relationship it struck with the Nacho Nyak Dun. The company and First Nation signed a benefits agreement in June of this year, ensuring that members of the First Nation receive their fair share of jobs and contracts from the project.

“You don’t really go anywhere when you’re at loggerheads with the local First Nation,” said McIntyre. “That’s pretty plain.”

But the project has faced vocal opposition from a band of Keno residents, who have come to enjoy the peace and quiet since the last mine fell silent 21 years ago.

Insa Schultenkotter used to do brisk business renting her cabin to German tourists, but not since heavy machinery began roaring by on a nearby road.

The water board acknowledged that local residents had concerns. But it’s job is only to regulate the quality of water. Noise is beyond its mandate.

And the Yukon Environmental and Socio-economic Assessment Board earlier determined that residents like Schultenkotter should have known when purchasing land in a historic mining district that industry may one day rev to life again.

Schultenkotter’s tried selling her cabin. But, so far, she’s found no buyers.

“We’ve been sacrificed so that a company from Vancouver can make as much money as it can possibly make,” she said.

Contact John Thompson at

Just Posted

Whether the dust jacket of this historical novel is the Canadian version (left) or the American (right), the readable content within is the same. (Michael Gates)
History Hunter: New novel a gripping account of the gold rush

Stampede: Gold Fever and Disaster in the Klondike is an ‘enjoyable and readable’ account of history

Yukonomist Keith Halliday
Yukonomist: Your furnace and your truck need to go

Perhaps the biggest commitment in the NDP deal with the Liberals was boosting the Yukon’s climate target


Wyatt’s World for May 14, 2021.… Continue reading

Copies of the revised 2021-22 budget documents tabled in the legislature on May 14. (Haley Ritchie/Yukon News)
Liberals introduce new budget with universal dental and safe supply funding

The new items were added to secure the support of the NDP.

Community Services Minister Richard Mostyn speaks to reporters on May 13. (Haley Ritchie/Yukon News)
Cap on rent increases will take effect May 15

The rollout of the policy is creating ‘chaos,’ says opposition

Chief Medical Officer of Health Dr. Brendan Hanley. (Crystal Schick/Yukon News)
Family pleased youth will be able to get Pfizer vaccine

Angela Drainville, mother of two, is anxious for a rollout plan to come forward

Safe at home office in Whitehorse on May 10, 2021. (John Tonin/Yukon News)
Federal government provides $1.6 million for Yukon anti-homelessness work

Projects including five mobile homes for small communities received funding.

Drilling at Northern Tiger’s 3Ace gold project in 2011. Randi Newton argues that mining in the territory can be reshaped. (Yukon government/file)
Editorial: There’s momentum for mining reform

CPAWS’ Randi Newton argues that the territory’s mining legislations need a substantial overhaul

At its May 10 meeting, Whitehorse city council approved the subdivision for the Kwanlin Dün First Nation’s business park planned in Marwell. (Submitted)
KDFN business park subdivision approved

Will mean more commercial industrial land available in Whitehorse

Main Street in Whitehorse on May 4. Whitehorse city council has passed the first two readings of a bylaw to allow pop-up patios in city parking spaces. Third reading will come forward later in May. (Stephanie Waddell/Yukon News)
Whitehorse council pursuing restaurant patio possibilities

Council passes first two readings for new patio bylaw

Neil Hartling, the Tourism Industry Association of the Yukon president, left, said the new self-isolation guidelines for the Yukon are a ‘ray of hope’ for tourism operators. (Ian Stewart/Yukon News file)
Yukon tourism operators prepared for ‘very poor summer’ even with relaxed border rules

Toursim industry responds to new guidelines allowing fully vaccinated individuals to skip mandatory self-isolation.

A lawsuit has been filed detailing the resignation of a former Yukon government mine engineer. (Joel Krahn/Yukon News file)
A year after resigning, former chief mine engineer sues Yukon government

Paul Christman alleges a hostile work environment and circumvention of his authority led him to quit

Most Read