Monday, July 14, 2014

Pit to Pier and the Navy and DNR Aquatic Lease

The Pit to Pier project took a bit of a blow last week when the Washington State Department of Natural Resources completed an agreement with the United States Navy regarding aquatic leases within Hood Canal (announcement here).

The Pit to Pier is a scheme to build a conveyor belt from a mining area to a ship loading facility on the shore of Hood Canal. The gravel deposits at the mine are a huge deposit of glacial outwash sands and gravels. In addition, there is a large rock quarry not far to the north that potentially could use the facility as well. I posted a few posts regarding this scheme a while back as the location of the proposed conveyor and pier are located in an area of known deep-seated large rotational landslides (sb5805-pit-to-pier-gravel-and-landslidesa-bit-more-on-pit-to-piergravel-pits-and-piers).

The active gravel mines and rock quarry currently are using truck transport mostly across Hood Canal Bridge to market facilities to the east. The Mats Mats Quarry is nearly done with mining but is slated to receive waste soils from Seattle's tunnel project to back fill the pit so the pier at that location is still in use. However, that pier is only for barge traffic and trucking to that site would be not feasible under current economics of aggregate mining. The proposed Pit to Pier scheme included ocean going ships to ship to distant urban centers including international sites.

The U.S. Navy was motivated to enter into the long term lease agreement with the DNR as the Navy is not keen on having large ship traffic within areas that they operate nuclear submarines and do submarine torpedo training and who knows what else. What is a bit surprising is that a long-term lease agreement was not one the first items the Pit to Pier project tried to complete.

Given the size of the deposit and gravel demand at urban centers, not only locally but nationally and internationally, the mining activity will likely continue and there may be other pier schemes. However, other sites that could serve these mines will be challenging to permit - particularly for the large ocean going ships that appear to be needed to make the project viable. A massive mine/pier project recently opened in British Columbia and there is another one in the works in BC. Hence, the investment opportunity may be risky given the competition and the challenge of permitting a long conveyor belt through rural and semi urban communities.

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