Kennecott Eagle Minerals, a wholly- owned subsidiary of Rio Tinto, reported in separate announcements in January and February 2010 it has received Michigan state approvals to begin construction of its underground Eagle nickel-copper mine and to refurbish and operate the nearby Humboldt mill to process Eagle ore at operations located about 25 km west of the city of Marquette on Michigan’s Upper Peninsula.
Capital expenditures for Eagle mine development are estimated at $300 million. A three-year construction effort will target mine startup in 2013. Site preparation for surface facilities, primarily environmental management and control programs, is set to begin as soon as construction schedules are finalized. The majority of work planned for 2010 will focus on clearing and grading the 120-acre mine site and building a state-of-the-art, $10-million water treatment plant.

The Humboldt mill was constructed in the late 1950s by Cleveland-Cliffs and processed iron ore from the Humboldt mine until the mid-1970s. Callahan Mining later reopened the mill to process sulphide ore from its Ropes gold mine until the late 1980s, and Mineral Processing Corp. assumed ownership of the mill in the 1990s, using it occasionally to process aluminum flux. Kennecott purchased the mill in September 2008.

Michigan Department of Natural Resources and Environment approvals for Kennecott to reactivate the mill included a Nonferrous Metallic Mine Permit for general operations of the mill; a National Pollutant Discharge Elimination System (NPDES) Permit for returning treated wastewater to the environment; an Air Use Permit for air emissions; and an Inland Lakes & Streams Permit for improvement and reactivation of the existing tailings reservoir.

Kennecott will invest $100 million in the mill redevelopment project and will begin clean-up of the property during 2010. In 2011, the company will build a new, stand-alone water treatment plant at the site to ensure that water discharged as part of the milling process meets state and federal quality standards. Later refurbishment plans include upgrading and replacing some of the millworks and installation of equipment and structures to ensure the modern, safe, and efficient operation of the facility.

The Eagle/Humboldt mine-mill project is currently expected to produce about 300 million lb of nickel and 250 million lb of copper over a mine life of six to eight years.