Donlin Gold Plans 2027 Decision on Multibillion-Dollar Mine Project

The developers of the proposed Donlin Gold mine in Southwest Alaska anticipate making a final decision on the project’s financial viability by 2027. This timeline hinges on the establishment of regulatory frameworks for a crucial gas pipeline, which is needed to power the mine. Currently, Alaska lacks specific rules governing the type of pipeline required for this project, a departure from typical practices in the state.

In a recent meeting, Enric Fernandez, the permitting manager for Donlin Gold, stated that the proposed natural gas pipeline will extend approximately 316 miles from the Beluga power plant on Cook Inlet to the mine site near the Kuskokwim River. Initial estimates for the pipeline’s construction range from $1.8 billion to $2 billion, based on a feasibility study conducted in 2002 and updated in 2020. This cost is set to be refined as part of a detailed “bankable feasibility study,” which will provide financial insights for potential investors.

The completion of this financial analysis is contingent upon the Regulatory Commission of Alaska drafting rules for contract-carrier gas pipelines. Unlike common carriers, which allow shippers to purchase capacity as needed, contract carriers offer long-term agreements for reserved capacity. Although the Alaska Legislature approved legislation in 2013 under then-Governor Sean Parnell to regulate contract-carrier gas pipelines, the state has yet to implement these regulations.

Fernandez emphasized the importance of these regulations, stating, “This is the ask,” during the meeting. The planned pipeline is designed to have a capacity exceeding the mine’s immediate needs, creating opportunities to sell gas to local communities as well.

In a strategic move to secure gas supply, Donlin Gold recently signed a letter of intent with Glenfarne, the lead developer of the proposed Alaska LNG project. Despite this partnership, Fernandez indicated that Donlin remains open to sourcing gas from various avenues, including imports. “There’s a number of options that are being proposed for Southcentral Alaska right now to bring natural gas, and we just see ourselves as part of the solution,” he noted.

The timeline for the project’s construction could see work commencing as early as 2027, with potential completion by 2031 if the financial assessments yield positive results. This ambitious project aims not only to tap into one of the largest gold deposits in the world, estimated at 33.8 million ounces, but also to address energy needs in the region.

As developments unfold regarding the regulatory framework and financial studies, the future of the Donlin Gold mine will become clearer, potentially marking a significant chapter in Alaska’s mining and energy sectors.