Governor Cuts Funding for Mining Road Project That is Subject of 2-Day Meeting in Fairbanks

Tribal leaders and stakeholders representing communities that could be impacted by a proposed 220-mile industrial road gathered in Fairbanks to discuss cultural, environmental and social impacts of the road’s potential construction. The meeting is happening at time when the state is facing difficult budget decisions that could hamper the project.

Download Audio

If built, the industrial road would provide access to the Ambler Mining District, rich in deposits of copper, zinc, lead, silver and gold. Rick Van Nieuwenhuyse is the CEO of NovaCopper, Inc., a mining company that would benefit from the road.

“The Ambler district is a very special district,” said Neuwenhuyse. “It’s very high grade. It’s the sort of district that can provide jobs for generations because it’s very substantial. It’s been known about for a very long time and it’s always been the issue of access.”

But funding may also become a problem as the price of oil continues to fall.  This week, Alaska Governor Bill Walker slashed more than $100 million dollars from the capital budget including $8 million that would have gone toward the road project in fiscal year 2016. Van Nieuwenhuyse said he doesn’t necessarily see the cut as a set back.

“It’s a big wake up call. The state will have to make tough decisions,” he said. “This may be one of them. There may be other alternatives for finding the continued advancement of the EIS.”

The Alaska Industrial Development and Export Authority is still working on the application to begin a federal Environmental Impact Study. Mike Catsi is the Business Development and Communications Director for AIDEA.

Cats said the Governor’s recent cut hasn’t hindered what is already a long and arduous application and permitting process.

“This is a proposed budget it still has to go through the legislative process. We’ve been in communications with the Governor’s office about the project,” Catsi said, “so right now we’re moving forward. We still have money in our budget until the end of June, 2015.”

Currently, funding for the project is coming entirely from state dollars appropriated by the legislature, but Catsi said if that changes in coming years, there are other ways for AIDEA to find money.

“At AIDEA, we look at projects from a business perspective,” Catsi explained. “We have to build a business case to move forward with them, so when we make an investment and we’re looking at paying for the permitting or moving forward with that, then we would be looking at recouping those funds over the long term of the project,” he said.

The state has already spent more than $26 million dollars on feasibility and development studies since 2011. Catsi said information from those studies is available on AIDEA’s website.

This week, AIDEA invited a number of representatives from various tribal organizations and villages that could be affected by the road’s construction to Fairbanks. During an interactive presentation, the majority of attendees told AIDEA they believe more studies on the environmental and cultural impact of the road are needed.