Open mining opportunities with a railroad

We’ve heard the old adage “opportunity knocks but once,” and I think I hear it knocking loud and clear. The Manh Choh Project could be great for Alaska, with good job opportunities and a significant lift to our state’s lagging economy. It would be an even greater opportunity if tied to a railroad link.

The current plan is to truck ore from Kinross Gold’s Manh Choh Project near Tetlin to the Kinross Fort Knox mill north of Fairbanks, driving 250 miles each way. The proposal has numerous roadblocks. First and foremost is safety. Second is the high cost of road maintenance over the proposed life of the mining operation. Ore concentrates would be carried by large trucks 90 to 120 feet long, with trucks moving in and out about every 7.5 minutes, 24 hours a day. There are significant concerns regarding traffic disruption, accidents, exposure to school traffic, seasonal tourism, wildlife and traffic destined for Delta and Tok, as well as defense-related convoys to Fort Greely, our nation’s only missile defense site. The cost of maintaining an aging road with that much traffic would be extremely high. I am reminded of a dialogue decades ago between the Trans-Alaska Pipeline consortium and the state Department of Highways: If they had foreseen the exorbitant costs of maintaining the haul road, they would likely have built a railroad instead.

The state, through the Permanent Fund, has already acquired a $10 million equity investment in the Manh Choh project. The state could only improve its standing as a minority equity partner by improving access for the project. The case has been well defined for a highway route, but it must be approved by Alaskans and our state government. For these reasons and many more, we need to look for another alternative: rail. This is truly where the opportunity lies.

Consider the viability of a railroad connection of approximately 107 miles for a first-phase route from Eielson Air Force Base to Fort Greely, our missile defense site. This would be followed at a later date by the second phase of an extension to Tetlin, approximately 121 miles to the mine site.

If there was agreement for a go-ahead on the railroad proposal, a temporary solution might be to allow the ore trucks to use the highway between Tetlin and a rail transfer facility near Fort Greely until the railroad connection was completed.

Finally, the third phase would be to connect to the Canadian border, a distance of 89 miles, with an ultimate hook-up to the Canadian National Railway system near Prince George, British Columbia. At that point, Alaska would be connected to both the U.S. and Canadian transcontinental railroad system. This would finally provide a major portion of Alaska with an alternative transportation service other than that currently provided by our maritime industry.

For the first time, the economics of a rail connection can be supported by identified freight tonnage: mine concentrates. The Manh Choh Project suggests 4-5 years or more of moving the ore north to the Kinross facility outside of Fairbanks. In addition, there is the possibility of additional mines being developed once rail is in place. The University of Alaska Fairbanks has identified numerous mineral prospects along the proposed rail right-of-way that could be developed once rail transportation becomes available. The Alaska Railroad Corporation has much of this information.

Canada’s Van Horne Institute, along with the University of Alaska Fairbanks and Michigan Tech, has estimated mineral potential within the 160-kilometer railway corridor, identifying 1,117 metallic mineral occurrences. These are in a 1,760-km section between Delta Junction and Fort Nelson, B.C. Value estimates exceed $659 billion.

Our national security is a critical addition to the necessity for a rail connection to Fort Greely, the only missile defense system in our nation. This is particularly urgent in light of our crisis posture with Russia and China today, as well as the rogue North Korea advanced missile launchings. And yet, the only transportation in and out of the Greely facility is via the Richardson Highway. The railroad would be a significant contribution to our nation’s national security and is sure to be welcomed by the Department of Defense, as well as nearby Eielson AFB.

The Alaska Railroad was constructed during World War I. The highway from Seward to Fairbanks and Anchorage was built years later. The railroad was designed as a development railroad to transport significant tonnage, mostly coal to Seward, Anchorage and Fairbanks, and points in between. Today, the railroad still carries coal in addition to oil, propane, container vans and numerous other commodities, as well as tourists within Alaska.

The opportunity is before us. Instead of ending up with a heavily used and tired Richardson Highway after the mines are exhausted, we would have a functioning new rail system furthering economic development as well as enhancing our national security. We would no longer be solely dependent on air and sea transportation, which would help alleviate the supply chain issues we’re facing today.

Whether we choose a highway or rail route, financing is a major factor. With the late Sen. Ted Stevens, Rep. Don Young, Gov. Bill Sheffield and I participated in the transfer of the Alaska Railroad to the state in the 1980s. With the sale of the railroad went specific authorization for the surviving state railroad to have millions of dollars in authorized bonding capacity. The rail funding should be considered in the recently passed congressional infrastructure bill, in which Alaska received $1.3 billion.

As Alaska is our nation’s recognized first line of defense, I would anticipate that the Department of Defense would prioritize a railroad financing effort.

Phase 3 would address the extension of the railroad the short distance from Tetlin to the Canadian border. Negotiations with the government of Canada and the Canadian National Railway to a connection near Prince George should not be too difficult. Under the former A2A (Alberta to Alaska) effort, there was a presidential authorization initiated which could be readily transferred to the Alaska railroad extension to Canada.

There is legitimate concern of the likely time delay to build a railroad to Tetlin, as opposed to a shorter time line using the existing highway. However, if the railroad were deemed to be a national security issue, it would be given priority and could be built quickly. In either case, there are numerous existing engineering studies and right-of-way studies, some held by the Corps of Engineers and others by the Alaska Railroad Corporation. These should be thoroughly reviewed before any decision is made, but they should help cut down the amount of additional studies required.

Some questions that need to be addressed by both the state and Manh Choh include:

How much is the public and the state going to pay to improve and expand the Richardson Highway? And what would we have to show for it at the end of the project? What would be the cost estimate to build from Eielson to Fort Greely, as well as from Fort Greely to Tetlin, and finally Tetlin to the Canadian border?

What is the economic future value of Alaska having a rail connection with Canada and the Lower 48 rail system as the third phase?

Let’s find out. Let’s get on track and start blowing the whistles.

Frank Murkowski is a former governor and United States senator from Alaska.

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