Mackenzie Valley Highway back on the radar (January 01, 2006)
January 1, 2006
YELLOWKNIFE, N.W.T. - The Northwest Territories government has released a report renewing calls for the construction of the Mackenzie Valley Highway providing an all-season road link between Southern...
YELLOWKNIFE, N.W.T. – The Northwest Territories government has released a report renewing calls for the construction of the Mackenzie Valley Highway providing an all-season road link between Southern Canada and the Far North.
The project would cost about $700 million but part of the cost could be recouped through tolls and fees on oil and gas development, the report said. The highway would allow easier access to the North’s vast energy and mineral resources.
The proposed all-weather road would link the NWT’s existing road network with the Arctic port of Tuktoyaktuk.
The Mackenzie Valley Highway was first discussed in the late 1950s and work actually began on the road in 1972. However, construction was halted in 1977 thanks to a 10-year moratorium on oil and gas development in the Far North.
“The political and economic difficulties that impeded the completion of the Mackenzie Valley Highway over three decades ago have improved,” Premier Joseph Handley and Transportation Minister Michael McLeod said while introducing the report.
The permanent road would replace the ice roads in use today, which the government claims are in jeopardy due to global warming.
“In the three northern territories, only one road, The Dempster Highway, crosses the Arctic Circle. This road does not reach the Arctic Coast. The Arctic Coast perimeter is longer than Canada’s other two coasts combined. This vast, remote and largely unpatroled coastline poses an increasing threat in terms of national security.”
The report claims the lack of infrastructure in Canada’s Arctic compromises Canada’s sovereignty in the region.
“Canada’s sovereignty is currently being challenged by many countries interested in an ‘over the top’ shipping route from Europe to Pacific North America and Asia,” says the report. “The trend of global warming may, in the not too distant future, make trans-navigation of the Northwest Passage economically viable. A highway to the Arctic would help assert Canadian sovereignty over Canadian Arctic waterways as shipping routes become increasingly accessible.”
Proponents of the new highway say the economy would be one of the greatest benefactors if the project should proceed. The NWT has been ranked fourth among 64 worldwide countries in terms of mineral potential but it ranked last in terms of infrastructure. The Fraser Institute study also showed 41 per cent of mining companies said the lack of infrastructure was a strong deterrent to investing there, with four per cent saying they would not pursue exploration in the region because of this factor.
The report suggests the entire project can be paid for in 35 years, provided $40 million per year is raised through tolls to cover operation and maintenance costs as well as debt payments.
Commercial vehicles would be tolled $500 per truck with 10,000 projected vehicles travelling the highway, totaling $5 million per year from the trucking industry.
Ultimately, with toll increases to reflect inflation and increasing truck traffic, the report says the trucking industry will likely shoulder $300 million of the $700 million price tag during the repayment period.
The report says trucking companies will recoup their toll expenses thanks to increased efficiencies.
“The existing limited transportation window makes development and exploration activities expensive and inefficient,” the report concludes.
“An all-weather link through the Mackenzie Valley would alleviate the increasing problems associated with the reduction of winter road reliability, uncertainty of road opening and closing dates and reduced periods of operation…(and) would transform the current intermittent system to one that functions 365 days a year.”