Opinion: Investing in Alaska’s infrastructure will benefit all Alaskans

The world needs copper and Alaska needs infrastructure to deliver it.

  • Thursday, October 31, 2019 7:00am
  • Opinion

Alaska has an opportunity to become a major supplier of copper at a time when global demand is on the rise, as more innovations like electric vehicles, alternative energy and battery storage are developed to lower the world’s carbon footprint. The world needs copper and Alaska needs infrastructure to deliver it; the Ambler Mining District Industrial Access Project or AMDIAP is part of the solution.

It takes an estimated five to 15 times more copper to build and deliver carbon-free alternative energy such as windmills and solar panels than fossil fuel-based energy. Miles more copper is required for each one of the millions of new electrically vehicles (EVs) being sold — five times as much as in internal combustion engines. The new battery technologies needed to store energy in EVs, homes and industry need copper to function as do cryptocurrencies, cloud computing and AI. The demand for copper will continue to grow for as far as the eye can see.

For Alaska, meeting this new demand means high paying jobs for generations of Alaskans. Mining jobs pay over $100,000 annually — that’s a salary you can raise a family on. These are jobs for people living in the more isolated rural communities nearer the mines, as well as for workers statewide. Many of the jobs are highly specialized and require training. The jobs will not only be at the mine site but all along the transportation route from the maintenance stations along AMDIAP, to the security station near Coldfoot, to the Alaska Railroad transfer point in Fairbanks and all the way to Anchorage where containers of copper concentrates will be loaded onto ships at the Port of Alaska.

AMDIAP will be built with private funds — not State of Alaska General Funds. AIDEA is a private state-owned corporation with a strong balance sheet. They have a great credit rating in large part due to the highly successful Delong Mountains Transportation System (DMTS) that supports the Red Dog mine, one of the largest zinc mines in the world, on land owned by NANA Regional Corp, which has been operating for over 30 years with no significant effect on the migrating caribou or subsistence hunting. The same is the case on the North Slope with over 50 years of operations! That balance sheet allows AIDEA to issue bonds that private bond holders will purchase — no state general funds needed. The money raised from the bonds pays to build the infrastructure and then the mining companies pay a toll to use and maintain the road to haul rich concentrates of copper, zinc and precious metals from the AMD. Bond holders won’t buy the bonds unless they are convinced that they will make a profit. After all, these are professional money managers — pension funds and the like who want a long-term guaranteed payout. This is a proven business model — a classic Public-Private-Partnership (3P) structure used to build infrastructure around the world. The DMTS was an innovative approach when it was done 35 years ago and 3P structures remain an excellent way to finance and build infrastructure today. To date AIDEA has paid the state General Fund over $400 million since formation. The model works.

The Ambler Mining District is blessed with an abundance of metals, including copper, zinc and cobalt. AMDIAP, or the Ambler Access Road, will carry billions of pounds of copper to market, and with it, the promise of more jobs, growth and a secure economic future for Alaska.

Well-engineered bridges and culverts will protect rivers and streams crossing the road, and therefore protect the food chain of fish and wildlife that need the water to survive. Caribou, as seen in the case of the Red Dog Mine, operating now for more than 30 years, will be given the right of way. Satellite and drone technology can be used to monitor the road and Caribou movements so the annual migration will go on unhindered.

However, delivery of copper to market goes beyond the length of AMDIAP itself. The economic promise of the copper ore beneath the surface of the Ambler Mining District cannot be realized without solving a basic problem — maintaining and expanding Alaska’s existing infrastructure.

Delivering copper for export to markets in North America and overseas depends on improving Alaska’s existing seaports and rail freight services. Both are severely underutilized and operating well below current capacity. For example, the Port in Anchorage is in use only two days a week. Concentrates from one mine operating in the Ambler mining district would add another day of use at the Port; a second mine would add another day. With a steady stream of copper concentrates as freight, the Alaska Railroad would gain a significant source of income beyond the tourist traffic during the summer months.

Improving and investing in Alaska’s infrastructure will provide a foundation we desperately need, so that we can continue to innovate and diversify our economy, and become a leading supplier of copper and other metals and materials such as cobalt, zinc, lithium and graphite — all necessary for a clean, green energy and transportation future.


• Rick Van Nieuwenhuyse is the former president, CEO and founder of Trilogy Metals. He is also the former president, CEO and founder of NovaGold. He is a geologist who has lived and worked in Alaska since 1967. He resides in Fairbanks. Columns, My Turns and Letters to the Editor represent the view of the author, not the view of the Juneau Empire.


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