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Northwest Arctic Borough to Receive Almost $200 Million Over 10 Years from Red Dog Mine

The Red Dog Mine in 2010. Photo: Alaska Public Media.

After a Borough meeting Tuesday night, a new payment in lieu of taxes (PILT) agreement has been struck between the Northwest Arctic Borough (NAB) and Teck Alaska, the operator of Red Dog Mine.

For the next ten years, NAB will receive annual payments from Teck Alaska based on a fixed asset value of Red Dog mine, which is estimated to be between $14 and $18 million per year. Wayne Hall, superintendent for environment and community relations with Teck Alaska, explains the annual payments to NAB have increased since the previous agreement.

“There was a previous PILT agreement that was for five years, which expired a year and a half ago, and we’ve been under a severance tax until this new agreement has come into effect with the approval of the ordinance on Tuesday.”

NAB previously received $11.6 million annually, but now, the new PILT agreement has an estimated value of $20-26 million per year over the course of its ten-year duration. Hall says it’s also a retroactive agreement, dating back to January 1st of 2016.

Also included in the agreement, Teck Alaska will create a Village Improvement Fund to be distributed by the Borough towards community services and infrastructure, with input from its eleven villages. The fund will be opened with $11 million and will receive $4-8 million per year based on a certain percentage of Red Dog’s gross profits.

Red Dog Mine sits on land owned by the NANA regional corporation and has been in operation since 1989. According to the corporation’s website, during the mine’s existence, NANA has received $1.3 billion in net proceeds payments from the mine and distributed $820 million of that to other shareholders and corporations.

The Northwest Arctic Borough Assembly approved the new PILT agreement on Tuesday night following a public hearing.

1 Comment

  1. Paul Lincoln on May 15, 2017 at 11:20 am

    As the Calista Corporation shareholder, I envy the success of Red Dog Mine, at the same time applauding the management of NANA Regional Corporation for delivering their commitment to their shareholder.

    Unfortunately, the Calista Corporation has been a battlefield as the Shareholder of the Corporation to the Management and the Board of Directors.

    During the first 25 years, since the inception of the corporation. Albert Nicholai has deceived us using the name of Matthew Nicolai, John O’Neill?, along with his accomplishes John Angaiak, and others who knew him from 60’s.

    These individuals were involved with the gang related activities in Anchorage, Alaska. Unfortunately, some knew, but suppressed due to their style of manipulating others.

    None-the-less, we have survived, and the new generation has arrived, and needs assistance if the battle is required.

    As for myself, it is time to retire, since there will be no large amount of illicit drugs to intercept, and Albert Nicolai’s mouth was very important pertaining to information in federal narcotic area.

    Godspeed

    Paul Lincoln(John)-Newtok.

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