New Pebble exec outlines plans for project development

CHARISSE ARCE

May 15, 2008 at 10:24AM AKST

John Shively, recently appointed chief executive officer of Pebble Limited Partnership, visited the Bristol Bay region’s communities of Iliamna and Newhalen on April 22-23.
Iliamna serves as the headquarters for site operations and is about 17 miles northeast of the Pebble deposit. I was asked by my manager at Iliamna Development Corp. to ask Shively a few questions while he was in town.

Shively had a busy schedule touring site operations and meeting with local residents but agreed to the interview.

We met at my grandmother’s house, where I was learning to improve my knitting. We talked at my grandmother’s kitchen table. Here are the questions and Shively’s answers.

Q: When was the last time you visited Iliamna and Newhalen? Has it changed any since your last visit?
A: My first time visiting was two to three years ago, and this is my second visit. It hasn’t changed too much, the only thing I see are more drill rigs at the Pebble deposit.

Q: What opportunities do you think exist for you to improve the involvement of the local communities in the area?
A: There are going to be a lot of opportunities, especially for Native corporations, with contracting opportunities. I worked for NANA for 17 years, and one example of a contracting agreement was at Red Dog, where NANA Corp. made a priority of the hiring and training of their shareholders. In addition, the NANA/Marriott joint venture provided Teck Cominco food and housekeeping services. Other joint ventures also emerged in transportation and drilling operations. Other opportunities for local involvement will be through land-use agreements, job opportunities and training programs. The important thing to remember is growth did not come overnight with Red Dog. With the Pebble project, there are some interesting opportunities for exploring the energy situation. We know there is a great amount of power that will be needed for operations and it is important we explore renewable energy options. Right now there is testing on site for wind power. We are also looking at geothermal energy and hydroelectricity. We will probably have to use a combination of power sources.

Q: In a recent interview you stated you view your role as increasing communication between those opposed to the mine and proponents. How do you intend to do this?
A: I am going to start getting out to the communities and talking to people, listening to them and their concerns. Pebble may be a difficult thing for people to talk about, but oil leasing was also a controversial issue I worked on when I was commissioner of the Department of Natural Resources for the state. We recently hired an independent company, the Keystone Center, to lead our stakeholder assessments and engage people in dialogue. But I am going to have to get out and personally talk with people in the communities.

Q: What parallels can you draw from your work on the Red Dog Mine with NANA Regional Corp. and the Pebble Project?
A: One similarity is that the Red Dog Mine is located in a remote place where Alaska Natives are the majority population. To date, NANA has been successful with over 50 percent Native hire. Although I left NANA 13 years ago, I would have hoped this percentage would be higher, but they have been doing a great job training and hiring shareholders. With Red Dog we developed contracting preferences with NANA as the mine was on their land, but we have more divided Native entities with the Pebble Project. We will have to have several land access agreements if this project moves forward.

Q: As you know, the Pebble deposit is on state land unlike Red Dog Mine. How do you foresee local and regional shareholders benefiting from the Pebble Project other than through direct employment?
A: There is the opportunity for many local corporations to form and grow new businesses, which ultimately could provide services around the state, and perhaps even outside of Alaska. Taxation can also benefit the state and the Lake and Peninsula Borough would also be able to receive taxation benefits. Direct employment would give locals another source of revenue.

Q: Although you have been in your position for a short time, what differences do you see working for the industry partner rather than the Native corporation like you did with NANA?
A: Well there are definitely different pressures. With NANA, my priorities were ensuring shareholders benefited from jobs, contracts and royalties. I took this position with Pebble because I felt this project deserved a fair hearing. My job now is to figure out if we can do this project safely and in a way it benefits all of Alaska. In addition, we have to determine if this project will be able to have a significant impact on local government and state revenue.

Q: I know you have a challenging task ahead of you but, in your opinion, what are some of the opportunities with the proposed Pebble Project?
A: As I mentioned before, energy is going to be a big opportunity. We know this project could have the potential to affect energy costs for both the Southwest region and perhaps even Southcentral Alaska. We are going to need a combination of power sources for this project. There are many cultural differences between the Native community and Western society. Western society is very career minded, whereas in the Native community this is not necessarily the case. Individuals in the Native community depend on subsistence living, and this is a big part of their lives. This means we need to have flexible work schedules that allow locals to take time to enjoy their subsistence activities. In addition, we need to train more people than we need for certain to address this issue and have enough people available to work when we need them.

Q: What are your three main priorities as CEO of Pebble Limited Partnership?
A: Staff the Anchorage Pebble office with enough people to handle all the demands. Get out to the communities and communicate Pebble’s vision of the project. Figure out if we can do Pebble in an environmentally safe way, determine what protections are needed, and if the project is economically feasible with these protections.

Q: So what is the Pebble vision you hope to communicate to the public?  
A: We are going to do a very thorough analysis of the project. We do not intend on trading one resource for another.

Charisse Arce works in community public relations for the Iliamna Development Corp. She can be reached at (907) 261-9452.