Construction of Tlicho all-season road to begin this fall
Tlicho Government takes 20% equity stake in road construction project that cuts through its lands
Work on the Tlicho all-season road to Whati will begin this fall and is expected to be completed by 2022.
The Government of the Northwest Territories made the announcement on Wednesday at the same time it announced it had signed an agreement with North Star Infrastructure GP to design, build, finance, operate and maintain the road.
The 97-kilometre two-lane gravel road will connect the small Tlicho community of Whati, N.W.T., to Highway 3. Whati, roughly 170 kilometres northwest of Yellowknife, is a fly-in community except for the months it is accessible by winter road.
North Star Infrastructure is a consortium made up of Kiewit Canada Development Corp., and the Tlicho government, with Peter Kiewit Sons ULC, Hatch Corp. and Thurber Engineering Ltd. as design and engineering partners. According to a press release, the Tlicho government has — for approximately $16 million — taken a 20 per cent equity stake in the project.
'New way of doing business'
This is the first time an Indigenous government has taken an equity role in a major construction project in the Northwest Territories, according to a spokesperson for the Department of Finance.
"Normally the government would just come in a build a road," Finance Minister Michael C. Mcleod said. "But now using the P3 [public-private partnership] process we're able to be a little more flexible with our funding."
"I think that this is a new way of doing business going forward. It minimizes the risk on the government. You don't have a huge outlay of cash at the beginning … and it gives the ones that get the contracts an opportunity to find … Aboriginal partners. It's a win-win for all through this."
The road contract is worth $411.8 million over 28 years. According to the press release from the territorial government, construction is expected to begin this fall, and will take between two and three years to complete. Payable upon "substantial completion" of the road is $110.4 million. The balance is payable over the next 25 years.
What we'd like to see them do is hire as many northern workers as possible.- Minister Robert C. McLeod
The territorial government will monitor the project to make sure North Star Infrastructure is living up to its contractual obligation to employ and train Tlicho citizens.
"What we'd like to see them do is hire as many northern workers as possible," said McLeod.
Projected employment numbers during construction and targets for Indigenous employment were not immediately available, although a spokesperson for the territorial government said the numbers would be forthcoming.
Tlicho Grand Chief George Mackenzie deferred comment to Whati Chief Alfonz Nitsiza who was not immediately available for comment.
Road not without controversy
The government applied for permits to build the road in 2016. Since then, the merits of the project have seen their share of debate.
Last spring, the territorial government deemed an extended caribou preservation buffer zone along the proposed road to be too expensive to include. Last November, when the territorial, federal and Tlicho governments agreed to provisions to reduce negative impacts of the road on wildlife and the environment, a proposed caribou no-hunt zone for non-Indigenous hunters along the road was not included.
According to Wednesday's press release, the federal government will contribute 25 per cent of the cost, with the territorial government providing the remaining 75 per cent. Kiewit Canada, the construction company behind the project, is a major international construction company. It built the 3.9-kilometre water retention dike at the Diavik diamond mine.
McLeod expects final licences and construction permits to be in place in time to start building the road in the fall.
With files from Alex Brockman