The Ambler Road to Ruin Grinds On
Governor Walker Releases Funding for Industrial Access Road
The Road to Ambler is a remnant from Governor Sean Parnell’s ill-conceived “Roads to Resources” program. This proposed 220-mile industrial access road would have tremendous impacts on fish and wildlife, which provide vital subsistence resources to communities throughout the region. It would cut across the Southern Brooks Range, running from the Dalton Highway to the Ambler Mining District. The Southern Brooks Range is home to some of Alaska’s most spectacular wild places, including Gates of the Arctic National Park and Preserve, and provides exceptional habitat for grizzly bears, wolves, Dall sheep, moose, wolverines, and three different caribou herds, including the Western Arctic Caribou Herd.
The Ambler road project would be for the exclusive benefit of special interests like a Canadian mining company, NovaCopper, and at the expense of Alaskans living in the region. Several communities along the proposed corridor, Tanana Chiefs Conference, and Evansville, Inc.—whose land would likely need to be crossed to build the road—have passed resolutions opposing the project. This road was a bad idea even when the State was in better financial shape. Now that the State’s financial health is hanging by a thread, it is a terrible idea that the State should drop.
Despite the state financial crisis, Governor Walker recently gave the green light for the Ambler Road project to move forward. The Governor’s decision comes after the project sat dormant for the past year. The Governor issued an administrative order in December 2014 that directed the Alaska Industrial Development and Export Authority (AIDEA)—the agency tasked with overseeing the project—to halt spending on the proposed road pending further review. Governor Walker took office in the face of dire budget shortfalls, and moving forward with a project estimated to cost anywhere from $190 to $990 million was, and continues to be, fiscally irresponsible. The Governor’s administrative order stopped the project before AIDEA could move forward with filing the right-of-way application and initiate an expensive environmental review process that would financially obligate the State.
But Governor Walker recently changed his mind. Despite the current budget shortfalls and cuts facing the State, the Governor authorized AIDEA to spend $3.6 million to file the permit applications for the project and begin the process for preparing the Environmental Impact Statement (EIS) required by the National Environmental Policy Act. According to current estimates, an additional $4.2 to $6.8 million in state funds would be needed to complete the EIS. In the meantime, the State’s budget crisis has resulted in cuts to critical services, such as the Alaska Department of Transportation’s budget for keeping roads plowed during winter storms.
Governor Walker claims that allowing the agency to move forward with the environmental review process will allow “the project to progress to a natural stopping point instead of a stalled mid-step.” This is the same point that the administration made when allowing other controversial mega-projects that were slated for the chopping block to move forward. However, this process is not stalled mid-step. The logical stopping point for this project is now, before the State files the permit applications for the project and initiates an expensive environmental review process.
The Governor’s notion that the environmental review process can be paused mid-stream ignores the law. The Alaska National Interest Lands Conservation Act (ANILCA) requires the National Park Service to prepare an environmental and economic analysis and grant a right-of-way across Gates of the Arctic National Preserve. In addition to the costs cited above for the EIS process, the State will also have to reimburse the Park Service for the cost of completing this ANILCA-specific process. Once started, the Park Service may not have the legal ability to halt its review or the right-of-way process.
With a price tag in the hundreds of millions and a budget deficit in the billions, the State has yet to put forward any viable economic plan for how it intends to pay for this project. AIDEA anticipates paying for the project by issuing bonds and charging tolls. Yet, NovaCopper—the only company with active mining prospects at the end of the proposed road, in the Ambler Mining District— anticipates contributing only $116.3 million toward the cost of the road, which will barely cover maintenance over a ten-year period, let alone construction costs.
AIDEA’s plan also assumes that NovaCopper is financially viable enough to move forward. This is a questionable assumption. NovaCopper’s parent company, NovaGold, has a dubious track record in both Alaska and elsewhere. NovaGold, led by NovaCopper’s current CEO, Rick Van Nieuwenhuyse, operated the Rock Creek Mine outside of Nome for only a few months before shutting down. NovaGold and Mr. Van Nieuwenhuyse were also subject to a class action lawsuit involving allegations that NovaGold misled investors about the economic feasibility of the Galore Creek Mine in British Columbia. NovaGold ultimately settled that case for $28 million Canadian dollars—the largest securities settlement at the time under Canada’s class action laws. If NovaCopper goes belly up, it won’t pay even the small fraction it has proposed committing to this project and the State could be left holding the financial bag on hundreds of millions of dollars in construction costs.
Trustees is working with a broad coalition of individuals, tribes, and local and community groups to protect the fish, wildlife, and special places of the Southern Brooks Range from this short-sighted development project.
Read more about the Road to Ambler.
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TL;DR The Ambler road project would be for the exclusive benefit of special interests at the expense of Alaskans living in the region.