A contentious mining project in Southeast Alaska just changed hands. Its new owner is already looking to sell.

Critics of a mining project that’s long stirred political debate in the Southeast Alaska town of Haines are celebrating an announcement that the development is on the market — just months after its owner acquired it.

A small, Vancouver-based company, American Pacific Mining Corp., assumed full ownership of the Palmer Project late last year. At the time, company executives and major investors touted it as an exciting deal that would provide a clear path forward for the project.

Now, in what mine opponents view as a stunning about-face, American Pacific’s executives are saying they intend to "transact on" the project and focus on advancing another development that the company owns, in Montana. 

The Southeast Alaska project is “outside of our wheelhouse, if we’re completely honest,” American Pacific’s chief executive, Warwick Smith, said in a call with analysts last month. 

The company notified state regulators this spring that it does not intend to do any exploratory drilling this year, marking the first summer the project will sit idle in several years. 

Palmer is now in a “state of transition,” the company said in its notice to the state. American Pacific officials did not respond to requests for comment.

Mineral exploration is a famously speculative industry, and it’s common for deposits to change hands, often several times, before a developer comes in and builds a mine.

But Palmer opponents still say American Pacific’s apparent desire to back away from the project signals a dimming of its potential.

“It’s a remarkable turnaround,” said Gershon Cohen, a longtime Haines resident and clean water advocate who’s concerned about the impacts of mining. “The project appears to be fading away.”

“This is a huge step toward protecting this valley,” he added, noting the Chilkat Valley’s wild salmon runs and huge bald eagle population. 

Other Haines residents have supported the copper and zinc project because it could bring high-paying jobs to the region. Gov. Mike Dunleavy toured the development several years ago. 

For years, Palmer’s owners have been drilling holes and studying its geology to determine whether a mine would be profitable. Some permits face legal challenges from a local tribe and conservation groups, and a mine would require additional permits from the federal government before it could be built.

The apparent setback for one of Alaska’s more advanced exploratory mines comes at a surprising time, when miners around the state are expecting boosts from high metal prices and the Trump administration’s pledges to accelerate resource extraction and permitting. 

Even amid their decision to sell the project, American Pacific executives have been advertising increased copper demand and the Trump administration’s particular focus on Alaska as potential tailwinds for Palmer.

Companies have been trying to advance the project for well over a decade. American Pacific bought a minority stake in the project in 2022. 

Development seemed poised to leap forward a few years ago, when the project had access to the deep pockets of part-owner Dowa Metals and Mining, a Japanese smelting giant. 

Dowa and American Pacific built a camp to house dozens of workers and initially appeared intent on drilling a mile-long tunnel under a glacier to access more ore — a step that observers said could boost the chances that developers would build a mine. 

But the tunnel still hasn’t been built. And Dowa, which spent some $20 million on the project over the past two summers, pulled away last fall, leaving American Pacific with full ownership of the project.

The Canadian company also received $10 million from Dowa, in exchange for an option to buy half the zinc produced at a Palmer mine if one is ever built. 

Palmer sits above the salmon-bearing Chilkat River some 15 miles from the Tlingit village of Klukwan and about 40 miles from Haines.  For years, the project has fueled political division in Haines, a small town renowned for both its rugged beauty and ideological rifts. 

Some residents see a mine as an economic lifeline for the Chilkat Valley’s rural population of 2,500, while others — including the leaders of Klukwan — view it as a threat to the valley’s wild salmon and subsistence culture.

American Pacific has not announced any potential buyers but is in the midst of negotiations, Smith, its chief executive, said on the April call. The company aims to sell the project to a company based in the state. “We think that there are better groups that are more well-suited towards Alaska than we are,” Smith said. 

The company expects to receive about $25 million in a transaction, he added.

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