E &

The degree to which the action may adversely affect an endangered or threatened species
or its habitat that has been determined to be critical under the Endangered Species Act of
1973. The action will not adversely affect any endangered or threatened species or its habitat that
has been determined to be critical under the Endangered Species act of 1973. (See EA page 12)

Whether the action threatens to violate Federal, State, or local law or requirements
imposed for the protection of the environment. The action will not violate Federal, State, and
local laws or requirements for the protection of the environment. Applicable laws and regulations
were considered in the EA (see EA pages 12-15). The action is consistent with the Tongass Land
and Resource Management Plan. The Kensington Marine Terminal is located within an Old-
Growth Habitat (OGH) Land Use Designation (LUD). There is an exception within the OGH
LUD for small areas of non-conforming development, such as mining activities, which may be
considered on a case-by case basis that are compatible with the surroundings of the characteristic
landscape (2008 Forest Plan, 3-60); these forest lands within this LUD are open to mineral entry
(2008 Forest Plan, 3-59) (See EA page 3).

CONCLUSION

After considering the effects of the actions analyzed, in terms of context-and intensity, I have
determined that these actions will not have a significant effect on the quality of the human
environment. Therefore, an environmental impact statement will not be prepared.

CONTACT

For additional information concerning this decision, contact: Curtis Caton, Geologist, Tongass
National Forest, 8510 Mendenhall Loop Road, Juneau Alaska, 99801. (907)789-6273.

IMPLEMENTATION
The project can be implemented immediately upon my signing of this Decision Notice
pursuant to 36 CRF 218.12.

Respectfully,
VA bo 1/22/1e
BRAD ORR Date

District Ranger

Juneau Ranger District

— Decision Notice —
Page 14 of 14


connected into the fuel depot piping. The pump station will be for refueling the fuel tank truck
that will then deliver fuel to the mill bench for use at the day tank.

MARINE HEADER CONNECTION
BETWEEN RIGID PIPELINE AND
FLEXIBLE HOSE.

Figure 1.

DECISION RATIONALE

I selected the proposed action alternative because construction of the fuel depot will allow the
Kensington Gold Project to continue mining operations in an economically viable manner while
remaining in compliance with regulatory requirements. However, the approved Plan of
Operations will be updated as required in the EA, and as required by 36 CFR 228. 4 (e) for a
modification to the approved Plan of Operations which is subject to approval under 36 CFR
228.5 (c). No significant issues were identified; therefore, no additional alternatives were
developed (see Table 1.). The 2014 Kensington Fuel Depot EA documents the environmental
analysis and conclusions upon which this decision is based.

— Decision Notice —
Page 5 of 14


is

to a small number of individuals. The Forest Service is requesting concurrence from the National
Marine Fisheries Service prior to implementation of the Proposed Action.

Bald and Golden Eagle Protection Act (1940, as amended) —Three historic Bald Eagle nests
(nest number 39,110, and 111) are estimated to be within 330 feet of the project. None of the
three nests was active when last surveyed in 2008 and their status is unknown. If the Proposed
Action is selected, a qualified wildlife biologist should conduct a survey for active bald eagle
nests prior to project initiation. Management activities will comply with 50 CFR 22.26.

ANILCA Section 810, Subsistence Evaluation, and Finding — The effects of this project have
been evaluated to determine potential effects on subsistence opportunities and resources. There is
no documented or reported subsistence use that would be restricted because of this proposal. For
this reason, this action would not result in a significant possibility of significant restriction of
subsistence use of wildlife, fish, or other foods.

Clean Water Act (1977, as amended) - The Clean Water Act of 1972 (CWA) is the foundation
for surface water quality protection in the United States. The objective of the CWA is to restore
and maintain the chemical, physical, and biological integrity of the Nation’s Waters (USDA FS
990A, 2012). Management standards, guidelines, practices, and permitting have been established
to address the Clean Water Act on Forest Service lands. This project will implement National
and State Best Management Practices (BMP’s), Tongass Land Management Plan (TLMP)
Standards and Guidelines, and acquire all necessary permits prior to construction and operation
of the Kensington Fuel Depot.

Clean Air Act (1970, as amended) - Emissions from the implementation of the proposal will be
of short duration and are not expected to exceed State of Alaska ambient air quality standards (18
AAC 50).

Marine Mammal Protection Act (1972, as amended) —The Proposed Action may but is not
likely to adversely affect the humpback whale and the western DPS of the Steller sea lion. Boat
traffic, construction disturbance, and petroleum spills could result in discountable or insignificant
effects to a small number of individuals in these populations. Construction timing and windows
of operation will be coordinated with a Forest Service Biologist.

Magnuson-Stevens Fishery Conservation and Management Act — There would be negligible
effects on freshwater or marine habitat because the proposal will not affect fish habitat and no
effects would be transported to the marine environment during activities associated with this
project unless an unforeseen event occurs. Although the potential for a spill is present, this
project minimizes the potential effects of a spill on aquatic systems through project design,
application of standards and guidelines, BMPs, Federal and State of Alaska oversight, and site-
specific mitigation measures. The National Marine Fisheries Service and Alaska Department of
Fish and Game have been notified of this project.

National Historic Preservation Act of 1966 — The Forest Service program for compliance with
the National Historic Preservation Act (NHPA) includes locating, inventorying and evaluating
the National Register of Historic Places eligibility of historic and archeological sites that may be

— Decision Notice —
Page 10 of 14


USDA tuAs}

in the project record. The Legal Notice for the formal 30-day comment period was published in
the Juneau Empire on June 26, 2015 and the EA was published on the Tongass National Forest
projects webpage (http://www. fs.usda.gov/projects/tongass/landmanagement/projects) for
distribution.

Public comments received on the EA were generally related to the issues below:

Concern that an environmental impact statement (EIS) level analysis should be used for the
Kensington Fuel Depot proposal instead of an EA level analysis.

No significant issues were recognized through the public scoping process, and no significant
effects were identified in resource specialist reports; therefore, an EIS level analysis of the
proposed action is unwarranted.

Concerns of cumulative impacts related to the Juneau Access Road.

There already exists a fueling system at the Kensington Marine Terminal facility. It is composed
of an upper and a lower lay down area; the isotainers are currently stored in the lower lay down
area. Both of these areas have already been developed for use under previously completed NEPA
for the Kensington project. If the Juneau Access Road is to be constructed, the NEPA analysis
for that project will have to consider the existing development in the Kensington Mine Marine
facility under cumulative effects for that analysis. The footprint for the updated Kensington Fuel
Development project has limited trenching on previously disturbed ground, which was analyzed
for effects in the EA.

Concerns related to ongoing operations at the Kensington Gold Project.

The Kensington Gold Project was analyzed in the 2004 Final Supplemental Impact Statement;
issues related to the Tailings Treatment Facility, mining plan, and underground exploration are
outside the scope of the Kensington Fuel Depot EA and were not considered in this analysis.

Concerns related to operational or design features of the proposed action.

Comments about design and operational features of the proposal were received. Best
management practices, construction, design, and operational features all have been included in
the EA as preventative measures that reduce the risk of degradation of fisheries habitat,
sedimentation, and fuel contamination into Berners Bay. All have been addressed in the
responses to comments, and any modifications have been included in the Clarification to the EA
section in this document.

Responses to comments can be found at http://www.fs.usda.gov/project/?project=45 154

ADMINISTRATIVE REVIEW AND OBJECTION RIGHTS

A draft Decision Notice/FONSI and EA were made available to the public in October 2015 in
accordance with the objection process prescribed in 36 CFR 218. One objection was received.

The Reviewing Official held a resolution meeting with the objector; however, no resolution was
reached. The outcome of the discussions in the resolution meetings was a letter of instruction
issued to me by the Reviewing Official to clarify the following:

— Decision Notice —
Page 7 of 14


ALTERNATIVES CONSIDERED BUT NoT CARRIED FORWARD

The EA did not consider alternate fuel sources such as propane or liquefied natural gas as
additional alternatives because:

¢ The mine operates all surface and subsurface mining equipment on diesel. Retrofitting
existing equipment or purchasing new equipment would be necessary if the mine changed
to an alternative fuel source.

e Electricity at the mine is produced by a series of five main diesel generators located at the
Jualin facilities. There are also two main backup diesel generators located at Jualin and
one additional emergency diesel generator on standby at the Comet Water Treatment
Plant. Seven main generators are located on patented claims and one emergency
generator is located on National Forest System Lands. Retrofitting existing equipment or
purchasing new generators would be necessary if the mine changed to an alternative fuel
source.

e The Proposed Action did not mention the use of an alternative fuel.

e No alternate fuel sources were identified as potential alternatives in either the internal and
external scoping period, or during the 30-day comment period in which issues or
alternatives could have been raised for analysis.

The fact that the entire mine operates on diesel fuel made consideration of a differing fuel
source impractical and unrealistic. The financial burden to replace or retrofit the fleet of mining
vehicles, equipment, and generators to operate on an alternate fuel source would be a significant
financial cost for the mine, and is not a reasonable or prudent expectation. Additionally, there are
not any Forest Service directives, direction in the Forest Plan, existing laws, or codes that
mandate a specific or preferred fuel source for activities occurring on National Forest System
lands.

The Kensington Mine can only be accessed by boat, seaplane, or helicopter; there is not a road
connection to the State of Alaska Highway System. The economic and reliable way to receive
freight is by barge at the Kensington Marine Terminal, which is located in Slate Creek Cove. An
improved access road connects the Kensington Marine Terminal to infrastructure at Jualin camp,
which is the central base of operations for the mine. The Lynn Canal side of the mine (Comet)
has unpredictable seas, no permanent marine dock, unimproved access roads, and is therefore an
unfavorable destination to receive freight or goods. Delivery of freight to Comet on Lynn Canal
is complicated by the fact that all supplies would need to travel though the underground tunnel
that connects sides of the mining operation. Changing how the mine currently receives deliveries
of freight is unreasonable and not a prudent alternative at this time.

PUBLIC INVOLVEMENT

This action was originally listed as a proposal on the October 1, 2014 Tongass National Forest
Schedule of Proposed Actions and updated periodically during the analysis. The public was
invited to review and comment on the proposal; 27 scoping letters were mailed on October 29,
2014 and 28 notice to comment letters were mailed on June 19, 2015; a mailing list is available

— Decision Notice —
Page 6 of 14


S

federal or state regulation that mandate deployment of a containment boom during refueling
activities.

Pg. 9. Fuel Depot Operation. # 6 should read, “Provide training for personnel working at the
Kensington Fuel Depot in fuel handling, fuel storage, fuel spill cleanup, and proper disposal of
contaminated material at the Kensington Gold Project.”

Table 1. Comparison of Alternatives by resource in EA.

Comparison of Alternatives
Resource Alternative 1 Alternative 2
No change to existing condition. Current inventory of invasive _ [Alternative 2 has a moderate risk of invasive plant infestation from habitat alteration, re-
plants indicate no infestations of high-priority invasive plants in_|exposure of mineral soil, and the importation of construction equipment or construction
Botany jor near the project area. No endangered, threatened, sensitive, |materials.
or rare plants have been documented in or near the project
area
‘The No Action alternative would not result in a change to the _|No direct effect to fisheries habitat from Alternative 2. However, the potential does exist]
Fisheries effects of fisheries resources. Existing conditions would remain. | for degradation of fisheries habitat by sedimentation, and fuel contamination from the
Proposed Action.

No change to existing condition. The existing risk to water [Alternative 2 will result in a higher risk of fuel contamination near surface waters, a
Hydrology |AUalit from fuel transfer at Slate Cove would be fuel reduction in sedimentation near surface waters, and a higher degree of regulatory

contamination resulting from isocontainer puncture and loversight.

sedimentation from transfer of isocontainers.

INo change to existing condition. The No Action alternative (Under Alternative 2 the scenic integrity would change with implementation of
Scenery _ |would continue to meet the Scenic Integrity Objective (SIO) of _|recommended mitigation measures, and achieve a level of scenic integrity more

Low to Very Low, and complies with the Forest Plan. consistent with the Old Growth Habitat LUD designation.

The No Action alternative would not result in a change to the [Alternative 2 is not likely to adversely affect the humpback whale and the western

effects on wildlife resources as described in the 2004 Distinct Population Segment (DPS) of the Steller sea lion. Boat traffic, construction
wildlife |Etvironmental Impact Statement. The No Action alternative is _ disturbances, and petroleum spills could result in discountable or insignificant effects to

not likely to adversely affect the humpback whale and the Steller |a small number of individuals.
sea lion. No additional threatened, endangered, or proposed
species will be affected by the No Action alternative.

FINDINGS REQUIRED BY OTHER LAWS AND REGULATIONS

The project was designed in conformance with: Forest Service Mineral Regulations, Forest
Service Manual directives, and complies with the Tongass National Forest Land and Resource
Management Plan. Descriptions of applicable laws are available in the EA.

FINDING OF No SIGNIFICANT IMPACT

I have reviewed the environmental effects of the 2014 Kensington Fuel Depot disclosed in the
EA. I have also evaluated whether the proposed action constitutes a significant impact on the
quality of the human environment or whether the environmental impacts would be significant
based on their context and intensity as defined by the National Environmental Policy Act
(NEPA) using the following criteria in the implementing regulations ( 40 CFR 1508.27).

Compliance with other Laws and Regulations

Endangered Species Act (1973, as amended) — A Biological Assessment was completed for
threatened, endangered, and proposed species. Both alternatives may but are not likely to
adversely affect the humpback whale and the western DPS of the Steller sea lion. Boat traffic,
construction disturbance, and petroleum spills could result in discountable or insignificant effects

— Decision Notice —
Page 9 of 14


DECISION NOTICE AND FINDING OF NO SIGNIFICANT IMPACT
2014 KENSINGTON FUEL DEPOT

U.S. FOREST SERVICE
TONGASS NATIONAL FOREST
JUNEAU RANGER DISTRICT
JUNEAU, ALASKA

— Decision Notice —
Page 1 of 14


ne | S

species. Agencies are not to fund or authorize actions that the agency believes are likely to cause
or promote the introduction of spread of invasive species, unless the benefits of the action
outweigh the potential harm caused by the species. Recommended mitigation measures are
incorporated into this environmental analysis.

E.O. 13175 (Consultation and Coordination with Indian Tribal Governments) — The
Douglas Indian Association, a federally recognized tribal government, was contacted via the
scoping letter and briefed during a monthly coordination meeting. Other tribal organizations,
such as Tlingit & Haida Central Council and the Sealaska Corporation were contacted via the
scoping letter.

E.O. 13186 (Migratory Birds) — A Forest Service Wildlife Biologist has determined that the
proposal should have no effects to migratory birds or their habitat.

E.O. 13443 (Facilitation of Hunting Heritage and Wildlife Conservation) — The project
would have no effect on hunting opportunities in the Berners Bay area.

CONTEXT

Context refers to the affected environment in which the proposed action would occur. This
means the significance of an action must be analyzed in several contexts, such as society as a
whole (human, national), the affected region, the affected interests, and the locality. Significance
varies with the setting of the proposed action. For instance, in the case of a site-specific action,
significance usually depends upon the effects in the locale rather than in the world as a whole (40
CFR 1508.27(a)). Both short-term and long-term effects are relevant.

The Kensington Fuel Depot project is a site-specific action that would take place within the
project area of Slate Creek Cove in Berners Bay. The Selected Alternative includes the
placement of seven fuel tanks, each capable of holding 50,000 gallons of fuel (350,000 total
gallon capacity), in the upper laydown yard of the existing Kensington Mine Marine Terminal. A
header pipe will be located along the northwest side of the Kensington Marine Terminal access
road and will connect to the tanks via an approximately 500 feet seamless pipeline. Fuel delivery
will be by barge that will dock at the Kensington Marine Terminal and connect to the fuel header
via an approximately 100-150 feet flexible hose.

The discussion of the significance criteria that applies to the Selected Alternative is within the
context of local importance. The Kensington Fuel Depot EA details the effects of the Selected
Alternative. None of the effects identified, including direct, indirect and cumulative effects, are
considered significant, and all resources meet or exceed their respective Forest Plan Standards
and Guidelines.

INTENSITY

The intensity of effects was considered in terms of the following:

— Decision Notice —
Page 12 of 14


USDA tuAs|

directly or indirectly affected by scheduled activities. Regulations (36 CFR 800) implementing
Section 106 of the NHPA require Federal agencies to consider the effects of their actions on site
that are determined eligible for inclusion in or are listed in the National Register of Historic
Places (termed “historic properties”).

Cultural sites are present and are currently being mitigated according to the terms of a MOA at
the Kensington Mine. A Forest Service archeologist has reviewed this project and has made a
determination under the provisions of Section 106 of no adverse effect for the proposed project.
The State Historic Preservation Officer concurred with this determination.

E.O. 11988 (Floodplains), E.O. 11990 (Wetlands) — The wetland is defined by Executive Order
11990. The wetland is identified in the United States Fish and Wildlife Service National
Wetlands Inventory as a wetland characterized by woody vegetation dominated by needle-leaved
evergreens with a substrate that is saturated to the surface for extended periods during the
growing season, but with infrequent standing surface water. No streams or wetlands have been
identified in the area with the exception of the beach fringe, an area of pre disturbance where the
marine facility has been constructed. The Project will not affect the functional value of any
floodplain as defined by Executive Order 11988 and will not have negative impacts on wetlands
as defined by Executive Order 11990.

E.O. 12962 (Recreational Fisheries) — Federal agencies are required, to the extent permitted by
law and where practicable, and in cooperation with States and Tribes, to improve the quantity,
function, sustainable productivity, and distribution of U.S. aquatic resources for increased
recreational fishing opportunities. As required by this Order, a biologist has evaluated the effects
of this action on aquatic systems and recreational fisheries and documented those effects relative
to the purpose of this order. The project minimizes the effects on aquatic systems through project
design, application of standards and guidelines, BMPs, and site-specific mitigation measures.
Since there are no direct effects to fisheries resources within the project area, there will be no
direct, indirect, or cumulative impacts related to this order. Impacts are likely to occur only from
unforeseen events. The National Marine Fisheries Service has been notified of this project.

E.O. 12898 (Environmental Justice) — This proposal, in accordance with Executive Order
128998, does not have disproportionately high and adverse human health or environmental
effects on minority populations and low-income populations.

E.O. 13007 (Indian Sacred Sites) — Tribal governments or their authorized representatives are
responsible for notifying the agency of the existence of a sacred site. No sacred sites were
identified within the project area.

E.O. 13112 (Invasive Species) — Executive Order 13112 directs Federal agencies to identify
actions that may affect the status of invasive species; prevent the introduction of invasive
species; detect and respond rapidly to and control populations of such species; monitor invasive
species populations; and to provide for restoration of native species and habitat conditions in
ecosystems that have been invaded. Actions to be taken include planning at the local, tribal, and
state level for species that are likely to cause economic or environmental harm, or, regional, and
ecosystem levels, in cooperation with stakeholders and organizations addressing invasive

— Decision Notice —
Page 11 of 14


as iS

1. Assess and specify the reasons why other alternative fuel sources, such as Liquefied
Natural Gas or Propane were not considered in the analysis, as reasonable or prudent
alternatives or incorporated as an additional alternative.

2. Assess and document the reason or rationale why the number of fuel tanks, size of fuel
tanks and fuel transfer components were considered or analyzed as the proper size, scale,
for mine use.

3. Specify deliberatively the safety components associated with the entirety of the design
features of the system, with safety measures or redundancy built-in to provide for
conservation of the land, water, and air.

4. Explain the "why" associated with the fuel facility use associated with Kensington Mine,
based on logistical, financial, and operational implications to the permit, annual program
of work, or business associated with the company.

Item 1 can be found in the Alternatives Considered but not Carried Forward section of this
document. Items 2-4 can be found in the Introduction section of this document. The objector was
notified in writing of clarifications and considerations to be incorporated into this document.

CHANGES AND CLARIFICATIONS TO THE EA

After public and agency review of the EA, the following changes and clarifications have been
made.

Pg. 4. Existing Condition. Biweekly was intended to mean twice per week, not every two weeks.
Full isotainers are delivered once per week and empty isotainers are off loaded once per week.
Biweekly was used to indicate the number of barge dockings related to shipping and receiving
isotainers to and from site. It is understood that 12-15 full isotainers arrive on a weekly basis and
that 12-15 empty isotainers depart site weekly.

Pg. 4. Existing Condition. The second sentence should read, “Approximately 12-15 isotainers of
fuel are stored at the lower laydown yard (Figure 3 and 4) of the Kensington Marine Terminal
for a total approximate capacity of 130,000 gallons.” This approximated capacity includes any
excess isotainers that may be on site, dependent on existing conditions of the mine. Total volume
of 12-15 isotainers is 78,000-97,500 gallons.

Pg. 4. Existing Condition. The fourth sentence should read, “Isotainers are transported by flat-
bed trailer that is pulled by a semi-truck from the lower laydown yard to the Mill bench for
refilling of the day use tank.”

Pg. 7. State of Alaska, Department of Natural Resources. The first sentence should read, “ADNR
requires authorization for use of tidelands and submerged lands at the marine facility and will
review any updates to the approved Plan of Operations for compliance with State Permits,
Licenses, and Certifications.”

Pg. 9. Fuel Depot Operation. Omit the requirement #3, which states “Deploy containment booms
each time refueling of the depot from a barge occurs at the Kensington Marine Terminal.”
Requirement 3 is being omitted in response to comments received and because of a lack of

— Decision Notice —
Page 8 of 14


gs

e The delivery vessel has the ability to shutoff supply pumping within one minute in the
event of a leak.

e The valving to be used in the facility are designed to close in the event of flow back
situation, which reduces the risk of fuel emptying back into the supply piping and then
into the environment.

e Supply piping to the tanks will be seamlessly welded and engineered to withstand an
unforeseen seismic event.

e Each of the seven tanks is equipped with double walls. The interstitial space between the
tanks is monitored for leakage from the primary tank into the secondary containment
tank.

e Each tank is equipped with a monitored pressure relief valve, reducing the risk of
excessive pressure buildup within the individual tanks.

e The fuel depot will be surrounded by a dike and underlined with a fuel resistant non-
permeable liner.

e An engineer certified by the State of Alaska will approve the engineering plan.
e To reduce the risk of electrostatic discharge, the facility will be grounded.

Although not specifically stated in the proposal, the driving factor to change to bulk supply from
the existing condition is likely related to the economics of receiving one shipment of fuel in bulk
versus the weekly shipments of multiple isotainers.

Operationally, the bulk fuel depot is ideal for the mine, this will be a positive, cost efficient
method for the delivery, storage, and distribution of fuel. The bulk depot will safely store fuel
according to industry standard, which reduces the risk of environmental harm. Additionally,
mitigation measures have been included in the 2014 Kensington Fuel Depot EA that further
reduces the risk of an unforeseen event causing damage to the environment.

DECISION

Based upon my review of the 2014 Kensington Fuel Depot Environmental Assessment (EA), I
have decided to implement Alternative 2, slightly modified. The modification of Alternative 2 is
the omission of requirement #3 (Page 9 of the EA) in the Fuel Depot Operation section, which
states, “Deploy containment booms each time refueling of the depot from a barge occurs at the
Kensington Marine Terminal.” This decision will modify the approved Plan of Operations and
allow seven fuel tanks with a total capacity of three hundred and fifty thousand gallons to be
installed above ground, at the upper laydown yard of the Kensington Mine Marine Terminal. A
buried header pipe will be located along the northwest side of the Kensington Marine Terminal
access road and will connect via approximately 500 feet seamless pipeline to the tanks. Fuel
delivery will be in bulk by barge that will dock at the Kensington Marine Terminal and connect
to the fuel header via an approximately 100-150 feet flexible hose. The fuel tank truck loading
station will be a 20-foot shipping container that houses a generator and pumping system that is

— Decision Notice —
Page 4 of 14


= ®

INTRODUCTION

The Forest Service has considered modifications to the approved Plan of Operations for the
Kensington Gold Project that involve the delivery, storage, and transportation of diesel at the
Kensington Gold Project. The number of tanks, transfer components, and volume of fuel is the
proposed action requested by Coeur Alaska, which is stated in the 2014 Kensington Fuel Depot
EA, Draft DN/FONSI, and the proposal submitted in April of 2014 by Coeur Alaska.

The purpose of this initiative was to consider the construction of approximately five hundred feet
of pipeline, and the installation of a bulk fuel depot in the upper laydown yard of the Slate Creek
Cove Marine Terminal. The fuel depot construction is to occur within the boundary of the
Kensington Mine (see Figure 1). The action is needed because underground mineral exploration
combined with scheduled site construction has created the need for a reliable fuel supply at the
remote location that allows for continuous operation in an economically viable manner.

Clarification with the meaning of “reliability of supply” as stated in the 2014 Kensington Fuel
Depot EA was questioned in received comments. The Kensington Mine consumes approximately
12-15 isotainers of fuel per week; the capacity of an isotainer is 6500 gallons. Fuel consumption
is estimated at 78,000-97,500 gallons weekly; the mine consumes approximately 312,000-
390,000 gallons of diesel fuel per month, or an estimated average of approximately 351,000
gallons per month. The criteria of design for the fuel depot was to meet the established need of
maintaining a large enough capacity that could store and then supply fuel for approximately one
month, or 350,000 gallons as stated in the 2014 Kensington Fuel Depot Environmental
Assessment. South East Alaska receives inclement weather regularly that has on occasion
delayed vessel traffic within Lynn Canal, which happens to be the only supply route to the mine.
A bulk fuel depot on site will allow the mine to avoid any unforeseen weather related shipping
delays. The fuel depot will also aid the mine in the avoidance of seasonal timing restrictions in
the fisheries habitat, which was addressed in the 2014 Kensington Fuel Depot EA. Fuel
consumption varies seasonally because of regional temperature fluctuations and summer
construction activities. The summer months are when construction, interim reclamation, and
surface exploration are scheduled, all of which increase the demand for fuel on site. Scheduled
for 2016 is the final raise of the tailings dam at the Tailings Treatment Facility (TTF);
additionally, the mine continues to drift the Jualin exploration adit which was initiated in the
summer of 2015. The scheduled construction along with exploration, and concurrent site
activities, justifies the need of having a “reliable supply” of fuel stored on site that can meet the
additional demand and avoid any unforeseen weather related delays.

The facility will be equipped with industry-standard design features as stated in the proposal, or
mitigated by measures stated in the environmental analysis. A summary of redundant built-in
components that reduce risk to the environment are:

¢ The industry standard components to be used in the proposed facility are currently in use
in bulk fuel facilities located in the State of Alaska.

e A covered secondary containment structure will be constructed at the marine header,
which will have sufficient freeboard to capture the volume of fuel in the supply piping
should an unforeseen event occur during fuel transfer.

— Decision Notice —
Page 3 of 14


The U.S. Department of Agriculture (USDA) prohibits discrimination against its customers, employees, and applicants for
employment on the bases of race, color, national origin, age, disability, sex, gender identity, religion, reprisal, and where
applicable, political beliefs, marital status, familial or parental status, sexual orientation, or all or part of an individual's income is
derived from any public assistance program, or protected genetic information in employment or in any program or activity
conducted or funded by the Department. (Not all prohibited bases will apply to all programs and/or employment activities.)

To File an Employment Complaint:

If you wish to file an employment complaint, you must contact your agency's EEO Counselor (PDF) within 45 days of the date of
the alleged discriminatory act, event, or in the case of a personnel action. Additional information can be found online at
http://www.ascr.usda.gov/complaint_filing_file.html.

To File a Program Complaint:

If you wish to file a Civil Rights program complaint of discrimination, complete the USDA Program Discrimination Complaint Form
(PDF), found online at http://www.ascr.usda.gov/complaint_filing_cust.html, or at any USDA office, or call (866) 632-9992 to
request the form. You may also write a letter containing all of the information requested in the form. Send your completed
complaint form or letter to us by mail at U.S. Department of Agriculture, Director, Office of Adjudication, 1400 Independence
Avenue, S.W., Washington, D.C. 20250-9410, by fax (202) 690-7442 or email at program.intake@usda.gov.

Persons with Disabilities:

Individuals who are deaf, hard of hearing or have speech disabilities and who wish to file either an EEO or program complaint,
please contact USDA through the Federal Relay Service at (800) 877-8339 or (800) 845-6136 (in Spanish).

Persons with disabilities who wish to file a program complaint, please see information above on how to contact us by mail directly
or by email. If you require alternative means of communication for program information (e.g., Braille, large print, audiotape, etc.)
please contact USDA's TARGET Center at (202) 720-2600 (voice and TDD).

USDA is an equal opportunity provider and employer.
Federal Recycling Program
Printed on Recycled Paper

— Decision Notice —
Page 2 of 14


S

\g
I?

Impacts may be both beneficial and adverse. A significant effect may exist even if the
Federal agency believes that, on balance, the effect will be beneficial. Effects are anticipated
to be negligible for the Selected Alternative (See Table 1 above).

The degree to which the proposed action affects public health or safety. There will be no
significant effects on public health and safety because the area is off limits to the public, and due
to safety restrictions of an active mining operation (See EA page 9). Additionally, safety
guidelines proposed by Petro limit access to the facility.

Unique characteristics of the geographic area, such as proximity to historic or cultural
resources, parklands, prime farmlands, wetlands, wild and scenic rivers, or ecologically
critical areas. There will be no significant effects on unique characteristics of the area because
the construction is to occur in a previously disturbed area on an active mine site (See EA page 9).

The degree to which the effects on the quality of the human environment are likely to be
highly controversial. The effects on the quality of the human environment are not likely to be
highly controversial. There is no known credible scientific controversy over the impacts of the
proposed action. The EA acknowledges that the selected alternative presents a risk of fuel
contamination but the risk will be offset by mitigations included in the document.

The degree to which the possible effects on the human environment are highly uncertain or
involve unique or unknown risks. The analysis shows the effects are not uncertain, and do not
involve unique or unknown risk.

The degree to which the action may establish a precedent for future actions with
significant effects, or represents a decision in principle about a future consideration. The
action is not likely to establish a precedent for future actions with significant effects.

Whether the action is related to other actions with individually insignificant but
cumulatively significant impacts. The cumulative impacts are not significant. The cumulative
effects of this project include past, present and reasonably foreseeable actions that will overlap in
space and time. The State of Alaska has been working on the environmental analysis for the
Juneau Access Project road, a road connection between Juneau and communities at the north end
of Lynn Canal. The Juneau Access Project, if a road is built, will need to consider the cumulative
effects of adding that project within the boundaries of the existing footprint of the Kensington
mine project area.

The degree to which the action may adversely affect districts, sites, highways, structures, or
objects listed , or eligible for listing, in the National Register of Historic Places or may
cause loss or destruction of significant scientific, cultural, or historical resources. The action
will have no significant adverse effect on districts, sites, highways, structures, or objects listed in
or eligible for listing in the National Register of Historic Places, because cultural sites that are
present are currently being mitigated according to the terms of a Memorandum Of Agreement
with the Forest Service, Alaska State Historic Preservation Officer, and Coeur Alaska at the
Kensington Gold Project. A Forest Service archeologist has reviewed this project and has made a
determination under the provisions of Section 106 of no adverse effect for the proposed project.
The State Historic Preservation Officer concurred with this determination. (See EA page 13)

— Decision Notice —
Page 13 of 14