DNR starts work on North Slope road network
The Department of Natural Resources is trying to take advantage of what it sees as a convergence of fortuitous events to build a network of roads across the western Arctic.
The Arctic Strategic Transportation and Resources, or ASTAR, project hatched out of a series of conversations Gov. Bill Walker had with North Slope Borough Mayor Harry Brower Jr. late last year about ways the state could support North Slope villages, DNR Commissioner Andy Mack said in a Sept. 12 interview.
Mack noted that the talks between Walker and Brower were similar to those Alaska governors have had for decades with local leaders about the need for basic infrastructure in rural parts of the state.
“In rural Alaska these infrastructure pieces sometimes take on a life of their own and can really improve the quality of life,” he said.
However, it wasn’t until a remarkable victory last November — not the Chicago Cubs — that the administration really saw a chance to make a move.
“Then the election happened last fall and President Trump was elected and very quickly we realized some of the things we’d been talking about — a lot had changed in the policy arena and there were some new opportunities to take the North Slope Borough up on what we’d been talking about and that was really to focus on community needs and whittling down the cost of living in those communities,” Mack continued.
As a result, DNR began to put together the concept of a network of basic gravel roads to connect communities across the North Slope, primarily in the federal National Petroleum Reserve-Alaska. A map on the department’s ASTAR page shows potential road corridors connecting Anaktuvuk Pass and Umiat to the south to Point Hope, Point Lay and Wainwright to the west and Nuiqsut and Point Thomson to the east, among others.
The administration then made a late addition to its capital budget request and in May, Mack and Brower sent letters to the House Finance Committee requesting funding to start planning for and prioritizing which parts of the large concept could move forward.
The Legislature ultimately approved $7.3 million for ASTAR; money reappropriated from the Department of Transportation, DNR and leftover funds from the Alaska Railroad’s Tanana River bridge project southeast of Fairbanks.
Mack said now is the time to investigate ASTAR despite the state’s serious budget problems because the Department of the Interior is reassessing its view of oil and gas potential in the NPR-A.
Recent Nanushuk formation oil discoveries inside the reserve and on state lands near it by ConocoPhillips and Armstrong Energy and strong interest in NPR-A leases in the fall 2016 federal oil and gas lease sale give every indication the assessment will show increased oil potential and industry wants more access into the area.
There has also been a push from resource development proponents in the state to reopen the NPR-A management plan and the Trump administration has hinted that it is interested in opening more areas in the 23 million-acre reserve.
Mack acknowledged $7.3 million doesn’t build much on the Slope and said that money will be used to plan projects and hopefully devise a payment structure for what might actually be built, which he also said almost certainly won’t come close to the entire network.
“We know we’re getting into some major (National Environmental Policy Act) planning. We think there ought to be good results for the communities on rights of ways so that we have clear plans for community development and if there’s a secondary benefit for industry, we’re happy, we’re extremely happy,” Mack said.
Most of that planning will be done over the next year to 18 months, he added.
DNR is currently advertising a long-term but temporary position to travel to the Slope communities, gather input and manage those planning efforts.
Those secondary benefits for industry — accessing otherwise isolated prospects — could help pay for ASTAR infrastructure through fees or simply expedited projects leading to more state taxes and royalties, according to Mack.
“Even if there is a minor uptick in production in one unit or field or it comes online a little sooner because a company might be able to pay tolls to get to that prospect it possibly has the ability to pay for itself,” he said. “Part of the project is to understand and examine the financial opportunities and one of the opportunities may be a tolling structure and how that might work.”
He said further that companies have noticed the ice road season being consistently squeezed on both ends.
Leaders of the small independent producer Caelus Energy have consistently noted that a road to their 6 billion-barrel Smith Bay oil prospect about 125 miles northwest of existing Slope infrastructure would bring down development costs immensely and likely get the project into production quicker.
While the state is moving quickly on ASTAR, Mack emphasized, “We’re not backing away from our commitment to protect the area and the subsistence culture but we certainly see new information that should be considered.”
He also said the roads could be used as utility corridors to bring lower cost energy and broadband to the region, but all that is a long ways off.
“We don’t have any particular project in mind and it will probably start out with an effort to identify what one or two roads in the NPR-A looks like, maybe a marine facility or two and what they would look like,” Mack said. “We’ll kind of chew it bite sizes.”
Elwood Brehmer can be reached at [email protected].