The Alaska Industrial Development and Export Authority (AIDEA) is considering looking for a new location for an ore terminal to serve Yukon mining interests, which would leave Haines as the practical alternative. The board voted unanimously on March 3 to study the costs associated with modernizing the Skagway ore terminal versus decommissioning it.
A resolution board members approved at a March 3 meeting authorizes AIDEA executive director Alan Weitzner to contract the services of ASRC Energy Services (AES) for up to $150,000 to conduct the study.
The evaluation comes as AIDEA’s lease of the ore terminal land is up for renewal. AIDEA owns the facility, but the Municipality of Skagway owns the land. The lease expires in 2023. The facility is currently used by Yukon mining company Minto Explorations, Ltd.
At the board meeting, members discussed the need to consider alternative locations for an ore terminal in the region if modernization of the Skagway facility proves too expensive, or if the community is no longer interested in having an ore facility.
“Anticipating a potential end to that lease, if there’s not a future for that ore terminal in Skagway, (we need to consider) what other alternatives there are for regional mining development and resources that are currently under development for use of an ore terminal,” Weitzner said, referencing Yukon mining interests and their need for a nearby deep-water mining port located on the road system.
Board members didn’t explicitly mention Haines, but Haines and Skagway are the only communities that fit this description.
The Haines Borough Assembly has expressed interest in partnering with AIDEA to renovate the face of the Lutak Dock, which has reached the end of its service life and officially closed last year after Alaska Marine Lines completed construction of a new freight ramp, ensuring Haines’ supply chain will remain intact.
In mid-December, the assembly asked interim manager Alekka Fullerton to reach out to AIDEA regarding proposals for the repair and development of Lutak Dock. They said any proposal they receive from AIDEA is non-binding and will be brought to the public for consideration. AIDEA is one of a number of funding sources the borough is contacting as it attempts to secure funding for the crumbling piece of infrastructure.
Several community members have raised concerns that AIDEA funding will be contingent upon construction of an ore terminal at the Lutak Dock.
In an interview on March 5, Fullerton said there has been little progress in the AIDEA discussions since the assembly directed her to reach out.
“We were going to have AIDEA come to the Lutak Dock town hall meeting and then it got postponed. I have not talked to them since. I have asked them to put something in writing but have not received anything,” Fullerton said.
In written comments Wednesday, AIDEA communications director Colleen Bryan told the CVN Haines is an attractive location for an ore terminal “because of its proximity to the Palmer Deposit being pursued by Constantine Metals” and its potential to bring jobs to the region.
At the AIDEA board meeting, members said their perception is that Skagway isn’t interested in the ore terminal’s continuation.
“It sounds like they don’t want us there, so I think we should be sensitive to the community’s wishes. They want to move toward the tourism industry. We should let them move toward the tourism industry,” vice chair Bernie Karl said. “We would just be better off taking the keys and handing them to the municipality and just walking away.”
Bryan said AIDEA is in conversation with Skagway leaders to better understand how the ore terminal fits in with the community’s growing tourism industry.
Skagway Mayor Andrew Cremata said in an interview Monday that the community’s attitude toward the ore terminal is more complicated than some board members’ comments indicate. The ore terminal is a source of “up to 23 jobs,” according to a document on the AIDEA website.
“We don’t want all of our eggs in the tourism basket, so one of our goals is to develop a dock solely for industrial use, but we don’t want an antiquated ore loader. It’s more than fifty years old and not a safe way to transport ore,” Cremata said.
A 2017 Skagway assembly resolution references several studies, beginning in the 1980s, that indicate the harbor is contaminated with ore concentrates including lead, zinc and copper. The terminal is currently on the Alaska Department of Environmental Conservation’s contaminated site list.
Cremata said the community would like to see the facility modernized and would like the contaminated area cleaned up, which could necessitate moving the ore dock and loader.
He said the board’s vote to study the costs associated with modernizing the facility confused him because he thinks this is a decision that should be made by the municipality.
“Municipalities need to make decisions about developing infrastructure and then reach out to AIDEA for funding. We appreciate their input, but ultimately, we’re going to keep our own counsel,” he said.
Bryan said input from the Skagway community is one of many steps that will need to occur before the board makes a final decision about the ore terminal’s future.
“When AIDEA reviews a potential investment it takes into consideration both the economic viability and the direct community support for the project. Ultimately, AIDEA will need to work with the residents and leadership of Skagway, as well as Haines, to understand their economic priorities and goals,” she said.
AIDEA purchased the facility in 1990 from White Pass and Yukon Route Railway using money from its economic development account. The purchase included a sublease of municipal property. According to Alaska statute, the authority is required to solicit the review and advice of the governing body in the area in which the economic development project is located before “the execution of contracts, agreements, resolutions or other matters that directly concern the development, maintenance, and operation of a project.”