What is the Birch Lake Project?

Franconia Minerals’ proposed underground mines will utilize modern mechanized mining technology to extract and then process sulfide-bearing ores that contain copper, nickel, platinum group metals (PGMs) and cobalt from two deposits beneath the surface near Birch Lake Reservoir in northeastern Minnesota. 

The two sites, known as the Birch Lake site (near Bob Bay on Birch Lake), and the Maturi site (about 4 miles northeast, where the South Kawishiwi River forks off from the Birch Lake Reservoir) are part of a geologic formation known as the Duluth Complex, which has been explored for copper-nickel-PGMs since the 1949.

The mines would produce large quantities of metals that are essential to everyday life and in some cases, national security The US currently depends on foreign sources to provide a significant quanity of these metals.  The operations  would also help to revitalize the economies of the surrounding Iron Range towns, an area that is historically mining friendly, but that has suffered during a 20-year mining employment downturn.  The Birch Lake Project would  create much-needed jobs and bolster state and community revenues through taxes and royalties.

However, there are environmental groups opposed to the project, primarily because it involves mining and processing sulfide ore, which in the past has been known to create acid mine drainage.  If that were to occur, they believe the runoff could threaten the water quality of the Birch Lake Reservoir and the nearby Boundary Waters Canoe Area Wilderness.  But Franconia will minimize and mitigate the risk of acid mine drainage leaving the site with current technology and available engineering controls. The Company will design, develop and operate the project in an environmentally sound manner that meets regulatory requirements.

Based on the approximately 2100 widely spaced exploratory holes that have been drilled in the past 50 years and Franconia’s on-going drilling program, the underground resources at Birch Lake and Maturi are now independently validated as “inferred.”  During the current Pre-Feasibility and Feasibility stages of the Project, which are expected to last until mid-2009, Franconia is planning to continue to drill at both sites, in tighter patterns, to better define the known resources and raise that level of confidence in the quantity and quality of the resource to “indicated.”  Drill sites are small and for the most part hidden from the Birch Lake Reservoir.

Before design and construction can begin , Franconia is required by state and federal regulatory agencies to complete extensive planning, studying, testing and permitting, to ensure the Project will protect human health and welfare, and the environment.  During this environmental review and permitting process, the public will have ample opportunity for comment and input.  As an open mining company, Franconia invites public and interest group participation and will undertake an extensive outreach program.  Only after an Environmental Impact Statement is approved and requisite permits are issued by the state and federal agencies, can the Project move forward.

The proposed Franconia mines will differ from open pit mining familiar to Minnesotans.  All the actual mining operations along with at least primary crushing will take place underground, so surface impacts will be much smaller.  Each mine site will occupy approximately 5 acres.  The southern site, near Bob Bay, is remote from existing development and the mine shafts will be well back from the lakeshore.  At the Maturi site, steps will be taken to mitigate surface impacts on nearby developments.

The southern deposit near Bob Bay is crudely canoe shaped.  Exploration to date indicates it runs approximately 8000 feet north-south and 1200 feet east-west and ranges from 10 feet thick at the east and west margins to over 200 feet thick in the center.  Its more or less flat top dips gently to the southeast and is some 1600 feet below the surface at the north end, sloping to about 2800 feet in depth, and then rising again to the south. The flat topped nature will allow room-and-pillar mining of the upper parts of the deposit.  The thicker parts of the deposit will require a modification of room-and-pillar mining or the use of different mining techniques .

The deposit to the northeast, at Maturi, is quite different.  It is also a tabular body, but it comes within as little as 200 feet of the surface and dips at about 45 degrees to the southeast.  It reaches a depth of up to 3000 feet at the eastern edge of the property.  Thus it will be mined differently.  For one thing a substantial “crown” pillar must be left at the shallow northwestern edge to guard against surface subsidence.

The underground mines will be accessed by vertical shafts, so compared to open pit mining, much less waste rock that will need disposal will be excavated during development.  Any sulfide-bearing portion of this waste will, in part, be put back into the mined-out areas of the mine backfill, to structurally stabilize it.  The remainder will be placed into a surface facility that will be engineered to control potential for acid mine drainage to surface or ground water.

Ore will be transported from the Birch Lake and Maturi mines to a processing facility built on approximately 30 acres within the Project boundaries. Crushing and then grinding of the ore will be followed by flotation processing that will remove the valuable metallic sulfide minerals, and thereby substantially all the sulfur and recoverable metals into a concentrate for further treatment. This will leave tailings with an expected sulfur level in the range of .05% – .08% (about the sulfur content of  everyday rocks), that will not be acid generating. A proprietary pressure-leaching (hydrometallurgical) process then recovers the metals and oxidizes the sulfur to sulfates, which are neutralized with lime or limestone to form gypsum, the material used in wallboard. 

The tailings from the flotation process, along with the small amount of waste rock from development and the wastes from the pressure leaching process will be disposed of partially in the mined out parts of the underground mines and in part in engineered surface facilities where drainage of water will be monitored and treated if necessary.  On closure of the mine, the surface facility will be capped so as to minimize air and water entering into the facility because, to generate acid conditions from such wastes, both air and water need to be present.

Franconia projects the life of the mines at a minimum of approximately 24 – 26 years. Dependent on the success of future exploration, this life may be significantly extended. The mines will be closed in an environmentally responsible manner and the sites will be returned to a usable condition.  To guarantee this, the state will require Franconia to post bonds and/or carry insurance or provide other financial guarantees to ensure proper closure and to assure that any unforeseen occurrences can be mitigated without burdening the state.