Buckhorn Bulletin
April 2005 Vol. 2 No. 5

Buckhorn Mountain Give Away - Forest Service Abandons EIS Process
Bush Administration Privatizes Public land on Buckhorn Mountain.
On December 21, 2004, Bureau of Land Management (BLM) Director Kathleen Clarke signed a mineral patent transferring 154.7 acres of federal lands on Buckhorn Mountain to Crown Resources.
The Mining Law of 1872 authorizes individuals or companies to locate mining claims on public lands, and to develop the mineral deposits. The Mining Law also authorizes mining claimants to purchase their claims for $5. per acre. The Bush Administration sold a half a billion dollars worth of gold, plus the surface land value for $770.
Although Congress has imposed a moratorium on BLM’s processing of mineral patent applications since 1994, the BLM claims that this patent application was not subject to the moratorium since the patents were originally applied for in 1992 and are grandfathered in.
Because BLM and the Forest Service have no management authority over the newly patented and now private land, mining and reclamation, the EIS and permits for the proposed Buckhorn Mountain Mine will be handled by the Washington State Department of Ecology. The Forest Service will do an Environmental Assessment (EA) that will only look at the impacts of road access and a mine water infiltration facility on public land.

Forest Service Requests Comment on Roads and Waste Water Dump
The USDA Forest Service requests public comments on issues regarding access for the proposed mine and for a pipeline and waste water infiltration area for an environmental assessment. Their scoping request states, “None of the previously submitted comments on the Buckhorn Mountain project will be considered by the Forest Service because most comments previously submitted were not site-specific to this new proposal.”
They will consider issues and concerns regarding 1.5 miles of new road and 5.25 miles of upgrading to existing roads from the proposed mine to Toroda Creek Rd down Marias Creek. The roads would be 24 feet wide with utility lines buried underground. Cow Camp Road would also be realigned with the new road.
The proposal calls for an infiltration area for treated mine water, an access road and 2,000 feet of pipe. The infiltration facility would consist of pipes imbedded in gravel in two trenches about 200 feet long and 25 feet apart.
A 4-strand barb wire fence would enclose 220 acres of private land and 74 acres (1.7 miles) of National Forest Land.

Who Should Pay For Roads?
Commissioners Seek Taxpayers Hand-out for Kinross Impacts
Instead of assessing fees for the road impacts to the mining company on roads in Okanogan and Ferry Counties, the respective county commissioners have asked Senator Patty Murray to appropriate US tax dollars to foot the bill.
Underthe section in the Metals Mining Act of 1994 (RCW 78.56.130) -- Impact fees by county legislative authority states that mining “may result in new demands on public facilities operated by local government entities, such as public streets and roads; publicly owned parks, open space, and recreation facilities; school facilities; and fire protection facilities in jurisdictions that are not part of a fire district. It is important for these economic impacts to be identified as part of any proposal for a large-scale metals mining and milling operation. It is then appropriate for the county legislative authority to balance expected revenues, including revenues derived from taxes paid by the owner of such an operation, and costs associated with the operation to determine to what degree any new costs require mitigation by the metals mining applicant.” It goes on to state, “The county legislative authority of a county planning under chapter 36.70A RCW may assess impact fees under chapter 82.02 RCW to address economic impacts associated with development of the mining operation.”
This is especially ironic since the Bush Administration recently gave Crown Resources /Kinross a hand-out of half a billion dollars worth of gold, plus the surface land value for just $770. It would seem that the company could afford to pay for the impacts they cause on county roads.

SEIS Delayed Again: Maybe August
Once again the rush to complete a draft Supplemental EIS for this ill-fated Son of Crown Jewel mine proposal is overcome by obstacles and subject to more delay. Since the Bush Administration has granted title to the public lands on Buckhorn Mountain, the Forest Service no longer have significant permit responsibility for the project and will no longer participate in the EIS process. The Washington State Department of Ecology will continue to complete the EIS. For some unknown reason the agencies changed the contractor working on the SEIS. Shaw Environmental was replaced by URS Corp.

Who is Kinross Gold Corp?
Kinross Gold appears to be an opportunistic group of investors who buy up small and bankrupt companies, exploit the resources and leave a wake of shattered earth. The first info we have is from June 1994 when Kinross acquired various property in Ontario, east of the Hoyle Pond Mine and in Quebec.
In December 1995, Kinross purchased shares of Mirage Resources Corporation from Imperial Metals Corporation and Bethlehem Resources Corporation. In addition, Kinross acquired shares of Welcome Opportunities Ltd.
In early 1996, Nesbitt Burns Inc., Midland Walwyn Capital Inc., Scotia McLeod Inc., CIBC Wood Gundy Inc., First Marathon Securities Limited, Richardson Greenshields of Canada Limited and Goepel Shields and Partners bankrolled Kinross for $84 million. This allowed Kinross to acquire more properties in Ontario and Quebec for gold exploration. Kinross also acquired the Canico Royalty, a 2% net smelter return (NSR) royalty from Inco Limited and to complete drilling on the 27,800 acre Goldbanks Joint Venture property (Kinross Goldbanks Mining Company and Restoration Minerals Company) located south of Winnemucca, Nevada.
In February 1998, Kinam Gold Inc. formerly Amax Gold Inc and Cyprus Amax Minerals Company merged with Kinross. Kinam owned various mining properties including the Fort Knox mine near Fairbanks, Alaska, a 50% interest in the Refugio mine in Chile and a 50% interest in the Kubaka mine located in the Russian Far East.
In 1999, Kinross acquired Newmont’s 65% interest in the True North Venture in Alaska and the bankrupt Kinross Goldbanks Mining Company and Restoration Minerals Company Timmins assets of Royal Oak Mines Inc.
In 2000, Kinross merged with La Teko Resources Inc.
In 2002, Kinross, TVX Gold Inc. and Echo Bay Mines Limited merged ownership. TVX including the TVX Newmont Americas joint venture. Also in 2002, Kinross entered into an agreement with a wholly-owned subsidiary of Placer Dome Inc. to form a joint venture the Porcupine Joint Venture, Ontario, Canada. Placer contributed the Dome mine and mill and Kinross contributed the Hoyle Pond, Pamour and Nighthawk Lake mines as well as the Bell Creek mill.
In 2003, operations at the Lupin mine Nunavut Territories was suspended as a result of operating losses. Local taxation authorities in Russia reassessed the tax paid by Kinross in the approximate amount of $8.5 million, which included penalties and interest. Kinross is contesting the assessment. Kinross and Bema Gold recommenced operations at the Refugio heap leach mine located near Copiapo, Chile. The Greek government terminated the mining contract of two Kinross subsidiaries to the Hellenic Gold Properties. Kinross sold its stake in Pacific Rim Mining Corp.
In 2003, Kinross restarted the Echo Bay Kettle River mill and mining of the Emanuel Creek deposit and acquired Crown Resources Corp which recently emerged from bankruptcy on the prospects of its 100% ownership of the Buckhorn Mountain gold deposit.
In late 2004 Kinross purchased 51% of the Rio Paracatu Mineracao (RPM), the owner of the Morro do Ouro mine (also known as Paracatu) in Brazil from Rio Tinto.

Kinross, SEC Disagree
Kinross Gold Corp. has a disagreement with the U.S. Securities and Exchange Commission over an accounting entry related to its takeover in 2003 of TVX Gold Inc. and Echo Bay Mines Ltd. The Toronto company has been working with the SEC for about a year and a half as it tries to close it’s takeover of Crown Resources Corp., which owns the Buckhorn Mountain and its gold deposit.
It seems Kinross, Canada’s third-largest gold producer, may have overvalued some assets in its 2003 financial statements and is reviewing whether to reduce $918 million (U.S.) in goodwill that resulted from the mine acquisitions. Goodwill is an accounting provision for the excess of the amount paid over the book value of the acquired assets.
This type of accounting question may not be technically illegal but certainly does not look good. The question that must be answered is: What is the value of those properties? Kinross believes that the excess amount paid for the takeover of TVX and Echo Bay reflected on its balance sheet was a great deal as of Dec. 31, 2003, there is a possibility that the valuations may not support Kinross’ belief.
Kinross has extended the deadline for the Crown Resource transaction until May 31.