Susistance Mining

Andrew C. Lee in Nome working on sub-sea crawler.

Andrew C. Lee in Nome working on sub-sea crawler.

The life of a Bering Sea gold dredger is hard work and by no means a way to get rich quick; most dredgers are either recreational or subsistence miners. Recreational miners don’t make a profit, they are just there for fun and adventure; they hope to cover most of the expenses of their hobby with the gold they find. Subsistence miners make a net profit at the gold mining, but only really enough to cover their modest living expenses for the year and then reinvest any extra gold money into upgrades and improvements on their equipment.

Even with thin margins, the life of adventure and freedom, hard work and challenges, exploration and discovery, and all the other reasons is a strong calling to a few hardy souls. So much so, that they have made a hit TV series about the adventures and mishaps of my fellow gold miners and wannabees.

In the Nome Offshore Mineral Lease sale of 2011, we gained access to over 2400 acres of new ground, in addition to the 800 acres from the previous sale in 1999 that we have been mining on with the prototype for the past 10 years.

Over the years, we have figured out what works and doesn’t work, and have refined the design of a second generation machine that would operate much more efficiently and productively. But the prototype works well enough, we can cover expenses and make a small profit, enough to get us to the next year and to make incremental improvements. Yet it doesn’t work so well that we can afford to build a whole new replacement machine, without bringing on costly investors that would negate the value of the increased gold production.

The biggest threat to resource extraction is ignorant people who hate progress and mask their hate in the guise of protecting the environment. Luckily the State of Alaska recognizes that this type of mining (placer) is very safe for the environment; and has been extensively studied, both in general and in this specific area. However, with mining in the current political climate there is always the risk that anti-progress people will gain power, shut down mining, and kill jobs.

Along those same lines, being granted the needed permits in a timely manner is always a risk; a low risk in the case of mining offshore Nome. There are 13 government agencies at the State and Federal level that review these types of mining operation. Most of these either have a general permit that covers most operations, or do not require a permit they just want to be kept in the loop. For the other agencies, there has not been unreasonable issues in obtaining their permits. Alaska DNR has designed an excellent consolidated form called the APMA that applies for all the needed permits with one comprehensive application.

From a technical point of view, there is always the possibility that the design improvements people attempt on new mining machines will not work, or worse, would hinder production. Of the 10 or 12 operations similar to the one I work with, that have been designed and built for mining offshore Nome, only one has been successful and is still in operation; and that is the one we operate. Our extensive experience and years of trial and error serve to mitigate this risk and greatly improve our chances for success, but that took time, expertise, and a great deal of trial and error.

Weather is always a factor in the offshore Nome mining operations, but this is more of a risk to profitability. Even in the worst weather years, we have managed to get over 50 days of mining; but we always get more days than the smaller operations. While miners who get weathered out are still able to have a fun and interesting experience, the main attraction for them to Nome is working on a mining operation pulling gold out of the bottom of the sea, there are many days where this cannot be accomplished due to weather.

Mechanical issues are an important risk and challenge for any operation. Nome is an extremely harsh environment, with extreme temperatures, salt water and spray, storms, and other natural factors. Combine that with the complexity of the machines and rigorousness of the activity; the toll on the mechanics of the operation make it hard to keep running. We mitigate this risk by starting with the proper equipment, then we have backups for every component that could fail, critical components have a tertiary backup. Also, since our vessel is bigger (now only the 6th largest in Nome, down from being the largest five years ago) aboard we have welders, torches, tools, metals, and all the accessories needed to affect repairs quickly and on site.

The definition of success for each miner and wannabe is different. For some they want the adventure and are willing to pay tens of thousands of dollars for it. Others want to break even while having their adventure. Some have a much higher bar of success and actually want to make enough money to cover their costs and support their family, of the 200 to 300 people that attempt gold mining in the Bering Sea each year, only 50, perhaps as many as 75 actually succeed in subsisting mostly on their profits from gold mining.

If you are thinking about mining for gold in Nome, or if someone is trying to get you to invest in an operation, email me “nome” at-sign “safonatt.com” and I can provide more information and specifics on what and who to avoid.

-Andrew C. Lee