Exploration firm reports sizable nickel deposits near Paxson

a base camp
Alaska Energy Metals used a helicopter for ferrying personnel and supplies to and from its base camp during last summer’s exploration work on a nickel deposit near Paxson. (Courtesy Alaska Energy Metals)

Alaska Energy Metals executives met with Delta Junction-area residents Monday to talk about a nickel deposit the Canada-based company is exploring near Paxson. They say the Nikolai Project could become an important source of the metal essential to manufacturing green energy products like wind generators and electric-vehicle batteries.

Prospectors discovered nickel around Paxson decades ago, but exploration conducted last summer by Alaska Energy Metals along with growing demand for the element has led company officials to believe the time is right to develop a mine.

“Our results were positive and I think that the project has the potential to move quickly,” says Alaska Energy Metals CEO Greg Beischer. He says the results were promising enough to convince investors to pay for additional sampling and survey work in two areas near Paxson, located in the eastern Alaska Range about 62 miles south of Delta Junction.

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A slide from an Alaska Energy Metals presentation shows the amount of nickel and other elements needed for electric-vehicle batteries. Company officials believe that will fuel increasing demand for nickel in the years ahead. (Courtesy Alaska Energy Metals)

Beischer says the Vancouver-based company plans to spend at least $15 million on the Nikolai Project in 2024 — three times the amount it spent last year.

“The market views us pretty favorably, in that they’re still willing to invest in our company,” he said.

Beischer foresees an even bigger payoff if additional exploration over the next four years confirms findings in a report the company issued last week. He shared information about promising nickel and copper deposits, along with lesser amounts of cobalt, platinum and palladium, at meeting with Delta-area residents Monday.

“We think our timing’s pretty good, because there’s a whole new use for nickel, and that’s in electric vehicle batteries,” he said. “They call them lithium-ion batteries, but in reality there’s a lot more nickel in the battery than lithium.”

Beischer and Alaska Energy Metals vice president for exploration Kyle Negri both assured the 20 or so people at the meeting that the company complies with state and federal environmental laws and regulations. Negri cited last summer’s drilling operations as an example.

“Here’s a picture of a drill rig on site,” he said during a Powerpoint presentation. “You can see it’s a relatively small-scale operation. Small footprint, low-impact.”

But members of the group voiced concerns about road construction in the remote area, possible contamination from open-pit mining near the headwaters of the Delta River, and whether the company intends to build a processing mill on site or truck the ore out on public highways, like the new Manh Choh gold mine.

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The question drew a response from Corri Feige, a former state Department of Natural Resources commissioner who sits on the Alaska Energy Metals’ board of directors.

“We are aware, like everyone else, about the sensitivity to the Manh Choh project and all the concerns around safety and trucking there,” she said.

Concern was also raised about whether Alaska Energy Metals intends to sell the project. Beischer conceded that’s the plan.

“Our preferred objective is to increase the value of the project and then sell it to a big mining company,” he said.

But Beischer agreed with a point made by a member of the group that if the project is sold, Alaska Energy Metals would have no control over the new company’s plan for the mine. And he said if his company can’t find an acceptable buyer, Alaska Energy Metals could develop the project, possibly with partners.

Exploration at the Nikolai Project is scheduled to resume in early June.

Tim Ellis is a reporter at KUAC in Fairbanks.

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