A new study is proposing an alternate way to get Alberta's bitumen to tidewater — through a combination of rail and pipeline.
The report released today by the Van Horne Institute studies the feasibility of building a railway from Fort McMurray to Delta Junction, Alaska, for bitumen transport. From there, the bitumen would be piped to Valdez for shipment to world markets.
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The estimated capital cost of the project is between $28 billion and $34 billion, based on production of one to 1.5 million barrels per day.
"The study indicates that this will be a railway built with safety as the paramount factor," said Peter Wallis, president and CEO of the Van Horne Institute.
A number of different routes were considered and ultimately rejected because of their proximity to areas that are environmentally protected, support migratory, sensitive or endangered species, or are important for wildlife and biodiversity, he said.
Between 16 and 24 specialized trains would travel the railway route each day, "built with basically safety as the prime consideration," he said, adding that the flammability of bitumen is "extremely low."
Some First Nations support
Wallis said that researchers held information sessions with First Nations leadership and bands directly affected by the project, some of whom have indicated they would support the project.
"The important factor here is the First Nations are engaged in this process," said Wallis.
A number of other organizations, including Shirocca Consulting, AECOM, Generating for Seven Generations (G7G), the University of Alaska (Fairbanks) and Michigan Tech Research Institute were also involved in the process.
Wallis suggested that the project would most likely be funded privately, but hopes that investors recognize the potential to "unlock a huge amount of mineralization" on either side of the route.
According to the study, deposits of copper, gold, coal and iron ore have been identified within 50 kilometres on either side of the proposed railway corridor and could be developed for market.
"This is really the thrust of what we're asking, is for thoughtful consideration of this report, looking at it over the long-term view that I think we have to bring to major nation-building projects."