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Vol. 18, No. 6 Week of February 10, 2013
Providing coverage of Alaska and northern Canada's oil and gas industry

Arctic port sites eyed

Army Corps, Alaska DOT select Nome and Port Clarence for feasibility analysis

Wesley Loy

For Petroleum News

A new report recommends development of a deep-draft seaport to support resource development, Coast Guard operations and other activity in the increasingly ice-free Arctic Ocean.

And the report picks two sites for port feasibility analysis: Nome and nearby Port Clarence. Both these locations are south of the Bering Strait, gateway to the polar ocean.

The draft report, titled “Alaska Deep-Draft Arctic Port System Study,” is a product of the U.S. Army Corps of Engineers and the Alaska Department of Transportation and Public Facilities.

It’s part of efforts that began in 2008 to consider Alaska port needs, including along the remote Arctic Ocean coast.

As ice cover thins and recedes with climate change, and with Arctic shipping and offshore oil and gas exploration on the rise, many recognize the need for one or more northern ports capable of accommodating deep-draft vessels. At present, no such harbor exists.

The 77-page report doesn’t include cost estimates. It recommends public agencies and banks or other private entities collaborate on funding and construction.

Vast area studied

“The Arctic is changing,” says the report forward. “Diminishing sea ice and expanded natural resource extraction are happening now. From drilling in the Chukchi Sea, dredging for gold in Nome, to ore and gas concentrate tankers coming over the top from Europe, Alaska is experiencing more and more traffic past its shores. Alaska’s western and northern coastline is mostly shallow with very little marine infrastructure. Coast Guard and other support vessels may be many days of ship travel away. Proper planning and responsible development is important to Alaska’s future.”

The study considered marine infrastructure needs over a vast area, from the Southwest Alaska village of Bethel west and north then east to the Canadian border. That’s more than 3,000 miles of coastline, or one and a half times the length of the eastern U.S. coast from Canada to the tip of Florida.

Aside from the recommendations to “invest strategically” in an “Arctic ports system,” including “deep-draft solutions,” and to focus feasibility work on Nome and Port Clarence, the report makes several other suggestions:

*Make the Army Corps the lead federal agency for permitting, design and construction of the deep-draft port system.

*Use public-private partnerships, known as P3s.

*Increase funding to the National Oceanic and Atmospheric Administration and other agencies for hydrographic and bathymetric mapping to support marine infrastructure development.

*Explore and develop navigational aids such as ship routing, vessel tracking and traffic separation.

The report defines a deep-draft port as one that can accommodate large vessels such as cargo ships. It should have water depth greater than 35 feet.

Alaska has deep-draft ports in such locations as Anchorage, Valdez, Kodiak and Unalaska, but none along the Arctic coastline.

Sites considered

The study team considered several potential port sites, some actually on the Arctic Ocean coastline and some to the south in the Bering Sea.

The “candidate sites” were: St. Paul Island, St. Lawrence Island, Nome, Port Clarence/Teller, Kotzebue/Cape Blossom, Mekoryuk, Cape Thompson, Wainwright, Point Franklin, Barrow, Prudhoe Bay, Mary Sachs Entrance, Bethel and Cape Darby.

The primary site evaluation criteria were proximity to oil and gas and mining activity, intermodal connections, upland support, natural water depth and navigation accessibility.

The team whittled the candidates to a shortlist of four sites: Nome, Port Clarence, Cape Darby and Barrow.

From there, the team recommended two, Nome and Port Clarence, for feasibility analysis considering, among other things, “alignment with potential investors.” The study says the two top-ranked sites will be the focus of feasibility work for 2013-14.

Nome’s proximity to oil and gas activity and mining operations, along with its upland support, make the city “an attractive choice for deep-draft operations,” the study says.

Nome is a small Bering Sea city on the south coast of the Seward Peninsula, about 100 miles south of the Arctic Circle. Although it is a regional trade center, Nome is disconnected from the state’s road system. It already has a medium-draft port, and is seeking to expand an existing causeway and related breakwater to accommodate deep-draft vessels, the report says.

Port Clarence, 67 miles northwest of Nome, is a former Coast Guard Loran station. The village of Teller is nearby.

“The natural protection offered within Port Clarence and its proximity to Bering Strait has led to the use of this natural harbor since whaling vessels were active in the region in the 1860s,” the study says. “It is currently used by barge operators as they await ice retreat north of Bering Strait each summer.”

Nome-based Bering Straits Native Corp. has been working with a marine transport company, Crowley Maritime, on a deep-water port development plan for Port Clarence, the study says. The port facilities would be designed to support offshore oil and gas operations.

Lots of planning under way

Notable sites that didn’t make the shortlist for deep-draft port feasibility analysis include the villages of Barrow and Kotzebue, as well as Prudhoe Bay, epicenter of the North Slope oil industry.

Barrow, a large and well-equipped village, is about midway between active oil and gas exploration targets in the Beaufort and Chukchi seas. At present, Barrow has no protected harbor.

At Prudhoe Bay, a causeway and dock system services barges that transport drilling and production equipment to the North Slope.

Kotzebue is another major village that supports the large Red Dog zinc mine. Kotzebue currently has a shallow-draft port.

The city of Kotzebue is pursuing a 10-mile road and deep-water port at nearby Cape Blossom, the report says. The state Department of Transportation is expected to start construction of the $30 million road from Kotzebue to Cape Blossom in 2014, and the city’s mayor said “expressions of interest” have been received for liquefied natural gas and copper export, the report says.

The big challenge in siting a deep-draft port for the Arctic is the generally shallow nature of the region’s coastal waters.

Cape Darby, another site on the Seward Peninsula, southeast of Nome, is “one of the very few naturally deep-water ports in the study area,” the report says. Cape Darby potentially could serve as a deep-draft port for resource export, but no community or infrastructure is there.

Another site, Cape Thompson on the Chukchi Sea about 26 miles southeast of Point Hope, also holds some appeal. The report says Barrow-based Arctic Slope Regional Corp. and a state agency, the Alaska Industrial Development and Export Authority, are interested in the site as a terminal for coal exports, and possibly as a Coast Guard hub.

“Cape Thompson gained notoriety in 1958 as the proposed site for an artificial harbor to be dug by nuclear bombs known as ‘Project Chariot,’” the report says. “The proposal was never implemented.”

‘Wild West’ or ‘Golden Days’

An Arctic port would serve more than industry.

“Navy, Coast Guard, NOAA and other research vessels are traveling the northern waters with little or no infrastructure support,” the report says. “The agencies have each expressed interest in utilizing a deep-draft port and enhanced port facilities, but they lack funding and authority to build such infrastructure. Long-term federal leases could provide a partnership opportunity.”

The report sketches out a number of possible scenarios “to examine the uncertainties of what lies ahead.”

The study team facilitated a scenario work session in July 2012 with more than 20 Arctic experts and stakeholders, with an outlook to 2060.

Under what the report calls a “Wild West” scenario, high demand for resources creates an “undisciplined world of boom and bust with everyone for himself.”

“The Wild West scenario could result in numbers of isolated single-purpose ports led by private investment,” the study says. “There would be no regional or state port authorities. Siting would be driven by independent business agendas and resource proximity. Public and private investment would not be coordinated. This scenario would not yield a highly functioning Alaska Arctic port system.”

A more favorable scenario, called “Golden Days,” would see collaboration in an environment of high and sustained resources prices.

“The Golden Days scenario could result in a number of regional port authorities, or even a statewide port authority to manage the high level of port operations in the Arctic,” the study says.

The draft study is posted at Comments may be submitted to [email protected] until Feb. 28.

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