Study finds Pebble Project's impact could be huge

June 1, 2013

According to a report by IHS Global Insight, the development of the Pebble Project in southwest Alaska could be significant enough to define a new economic engine for the state.

The report found that the potential economic impact could include an estimated $136 to $180 million in annual taxes and royalties, annual expenditures that could place the operation among the top tier companies in the state, and an estimated 600 percent increase in new tax revenue.

Among the key findings of the report commissioned by the Pebble Limited Partnership, are that the copper, gold and molybdenum mine could support more than 16,000 jobs nationwide during construction, including nearly 5,000 jobs in Alaska alone during that time frame with an average annual wage of $63,500 per year. Pebble operations could support nearly 15,000 jobs in Alaska and nationwide.

“Pebble is a substantial multi-billion dollar state asset as shown by this report, which provides great insight regarding the long-term positive economic impacts the project could have for the region, state and the Lower 48,” said Pebble chief executive officer John Shively. “For perspective, the report indicates Pebble development alone would pay more in annual taxes to the state than the entire fishing industry combined. This clearly shows Pebble development could be an important economic driver for Alaska’s future.”

The IHS Global Insight study is based on a conceptual mine plan using an iteration of the ongoing engineering work undertaken by the Pebble Limited Partnership. The study estimated the state and national economic benefits associated with a five-year construction phase, followed by a 25-year production phase, and the potential for three subsequent 20-year development phases. Currently, scientific studies and engineering work continue related to the deposit, and no final project design has been selected or approved at this time by the Pebble Partnership.

Construction of the mine will require a capital investment of more than $1.2 billion annually in direct spending over a five-year timeframe. Construction could generate an additional 2,500 jobs related to the mine site and nearly 1,000 jobs with suppliers and other industries. Spending from mine workers during the construction phase could support another 1,275 induced jobs in Alaska.

Once the mine is constructed, it could provide approximately 2,900 operating jobs, of which 915 will be at the mine. Pebble workers on-site could earn approximately $109,500 per year on average, according to the report, with about 75 percent of the workers expected to be Alaska residents. Pebble operations could contribute $1.1-$1.4 billion annually to gross state product (GSP) during the 25 year operation evaluated by IHS Global Insight.

Pebble would make important contributions to the state treasury and to the Permanent Fund because the deposit is located on state of Alaska land.

Based upon the severance tax structure for the Lake and Peninsula Borough, the report estimates Pebble could contribute approximately $29-$33 million annually to the borough for an estimated $725-$825 million during the initial production phase for the project.

The Pebble deposit is located in Southwest Alaska about 200 air miles from Anchorage and 100 air miles from Bristol Bay, on state lands set aside for mining.

To access a full version of IHS Global Insight’s report The Economic and Employment Contributions of a Conceptual Pebble Mine to the Alaska and United States Economies, visit



Related article search: