Roads to Resources adds West Susitna, stalls other projects
The NovaCopper exploration site camp in the Ambler Mining District is seen in this aerial photo. As part of the Roads to Resources initiative begun by Gov. Sean Parnell in 2011, the 220-mile road to the Ambler district is estimated at $350 million to $500 million. The project is still in a nascent stage, however, and a new study has added several new projects to the initiative.
As the original Roads to Resources projects await more money, a new state study adds new proposals to the mix.
The West Susitna Access Reconnaissance Study released by the Department of Transportation and Public Facilities in late January highlights five routes, that if constructed, would provide access to the largely undeveloped side of the Susitna River valley and the resources available there.
Collectively, the more than 350 miles of proposed access corridors are more than $1.8 billion of infrastructure, representing another “mega project” for the state.
DOT Roads to Resources manager Murray Walsh said the study considering ways to reach significant coal and mineral deposits in the area came out mostly as anticipated.
“I haven’t heard anybody express shock and amazement at the results,” Walsh said. “I think most of us expected to find a lot of opportunity on the west side; it’s just seeing it all described in one place creates the sense of opportunity.”
The routes that stood out as initially the most practical to begin development with are a 64-mile road to Beluga on the west side of Cook Inlet and one of two possible roads extending up the Skwentna River valley to the edge of Rainy Pass at the base of the Alaska Range. The Beluga road would skirt the Susitna Flats State Game Refuge near the mouth of the river, run past several placer gold claims and end in close proximity to the Chuitna Coal Project. Its cost estimate, with a 1,640-foot bridge across the Susitna River, is $257 million, or about $4 million per mile.
A 72-mile road extending south and west from an area south of Trapper Creek near Amber Lake to and along the Skwentna River would require 1,200-foot bridges across the Hayes and Yentna rivers and cost roughly $504 million. Another option to reach the same area would begin at the Little Su River Road — as would the Beluga road — and run 108 miles to Rainy Pass. That option would cost $453 million, according to the report.
All of the cost estimates in the study are for 24-foot, two-lane gravel roads.
Both of the Skwenta valley routes pass the 13,160-acre Canyon Creek coal lease area, which with total inferred resources of nearly 260 million tons is “so huge you could almost justify a railroad for it,” Walsh said.
The Department of Natural Resources issued a decision to hold a competitive lease sale for the Canyon Creek land last July, however a sale has yet to be held.
The state estimates the entire region holds more than 11 billion tons of subbitumous coal, primarily used for electrical generation, valued at more than $530 billion at current prices.
Additionally, the Beluga road would bisect numerous West Cook Inlet oil and gas lease holdings.
Walsh said the biggest challenge to developing any road is funding. Access roads to do not qualify for Federal Highway Administration funds that go to projects that prioritize safety and capacity improvements, he said. One way around that would be to enter a partnership with private entities interested in developing the resources in the area to help pay for the work, Walsh speculated.
The Susitna Valley State Forest would benefit from increased access to the west side of the valley as well, Forestry Division Director Chris Maisch said. If passed, mirror legislation House Bill 79 and Senate Bill 28 would form the 762,700-acre forest from 33 parcels in the river valley.
The area contains roughly 312,000 acres of viable timberland, with much of that being on the west side of the Susitna River, according to a 2010 state assessment of the land. While much of the available timber is not up to the quality of that found in other areas of the state, the resource may be able to support a value-added processing industry or provide fuel for small-scale biomass energy operations, Maisch said.
The road to Tanana northwest of Fairbanks is the furthest along of the four major Roads to Resources projects Gov. Sean Parnell proposed in late 2011. DOT Northern Region engineer Ryan Anderson said the road that would reach the Yukon River on the opposite bank from the City of Tanana is nearly ready for construction.
“We’re all permitted on the Tanana Road,” Anderson said.
Planned as a one-lane pioneer road with frequent turnouts, the 26-mile road extending from the end of the Tofty Road off of the Elliott Highway would provide direct winter access to the community via an ice bridge and summer access via ferry, Anderson said.
Negotiations with Native corporations about right-of-way access across corporation lands are the last major hurdle for the road and have been “positive” so far, he said. Tanana residents collected timber from state land cleared for the right-of-way for use as firewood and in the wood-fired boilers that heat several public buildings in the city, Anderson said.
Parnell proposed $6 million in his fiscal 2015 capital budget to complete the project that received $10 million as a part of the first Roads to Resources appropriations in fiscal 2013.
A 220-mile road to the Ambler Mining District would cost between $350 million and $500 million, DOT’s Walsh said. If Parnell’s $8.5 million proposal for the project is approved by the Legislature it will have had $21 million dollars appropriated to it over three years. Walsh said complete design would likely more than double that figure.
“The investment the state is spending now is basically taking it to permitting,” he said.
Future money appropriated to the Ambler Road project will go to the Alaska Industrial Export and Development Authority so it can investigate financing options for construction if it gets that far, Walsh said.
NovaCopper, which has claims in the mining district containing more than 140 million long tons of indicated and inferred copper ore, is a possible financing partner for the industrial road.
The public’s access to the proposed industrial use road could hinge on how much private money, if any, is put forth to fund construction and maintenance.
Upgrades to Southeast’s Klondike industrial use highway that connects Skagway with Canada’s road system — appropriated $2.5 million in fiscal 2013 — are on hold, Walsh said.
The road is currently rated for 10-axle, 170,000-pound loads. Walsh said the goal is to eventually increase its weight limit to 12-axle, 200,000-pound loads, but before that can happen the Captain William Henry Moore Bridge must be improved, a project that is allocated $13.4 million in Parnell’s budget proposal.
When the Roads to Resources initiative was started in 2011 the goal was to finish the Klondike Highway improvements by 2017.
“The Yukon mining boom that was predicted in 2011 has not kicked off yet,” Walsh said, meaning increased demand for a stronger highway hasn’t materialized either.
Work on a spur road to Umiat off of the Dalton Highway on the North Slope is on hold as well, Anderson said. A draft environmental impact statement has been suspended until results from exploratory drilling work Linc Energy is doing in the area this spring are known, according to Anderson. If the results do not lend to further oil and gas development, demand for the road would fade.
The 116-mile road would begin near Galbraith Lake at milepost 278 on the Dalton Highway and run northwest to Umiat. That project began with $10 million in state money nearly three years ago.
Elwood Brehmer can be reached at email@example.com.