North

Whati road not a subsidy to mining industry, says N.W.T. minister

The N.W.T. is pressing ahead with preparations to build an all-weather road from Behchoko to Whati, although the Department of Transportation says construction is not guaranteed and vital federal funding has yet to arrive.

Officials conduct site visit as territory awaits federal funding for all-weather road

N.W.T. Transportation Minister Wally Schumann denied in the legislature that the road to Whati is a subsidy to the mining industry and said it had been brought forward by the Tlicho Government. (CBC)

The N.W.T. government denies a proposed all-weather road from Behchoko to Whati is a simple "subsidy to the mining industry."

Fortune Minerals wants to mine for cobalt, bismuth and other minerals at a site almost 50 kilometres north of Whati. The company says an all-weather road from Whati to the existing highway network is critical to the mine going ahead, and has asked the territory to look at building one.

The territory believes the road is worthwhile and will cost around $150 million. Federal funding to help meet that cost has not yet arrived, but the project remains listed in the 2016-17 business plan for the N.W.T. Department of Transportation.

That business plan says building the road would "improve access to the community of Whatì and facilitate existing and future economic opportunities in the region." An economic evaluation of the road, prepared in March last year, concludes the road's benefits would outweigh its costs by around $12 million — but only if the mine goes into production and achieves the expected price for its output.

In the legislature this week, Yellowknife Centre MLA Julie Green questioned the road's economic worth and suggested it had been pencilled in for development without full consultation among MLAs.

Addressing transportation minister Wally Schumann, she said: "The economic benefit of the road alone without the mine is so small. Is this road, in fact, a subsidy to the mining industry?"

Schumann, in response, said the road was no such thing and had been brought forward by the Tlicho Government. He says the full caucus of MLAs, including Green, approved the road's inclusion in the government mandate months ago.

Road may be P3 project

Schumann added: "No decisions have been made on even if we're going to be building this road. We're still waiting to hear back from the federal government on infrastructure dollars. If we receive those funds, how we proceed will be something that the department will have to look at."

The territorial government wants to pursue building the road as a public-private partnership, or P3, and has been pressing ahead with preparations while it waits for federal cash.

Last summer, the territory submitted plans to the federal government's P3 advisory body for consideration. This week, officials from that federal body were in the N.W.T. to conduct a site visit and review the application in detail.

Permitting work for the road with the Wek'eezhii Land and Water Board has also begun.

Chief of Whati Alfonz Nitsiza previously told CBC News that residents of the community believe shipping costs could drop and new businesses could arrive if a road is built; but there are concerns over a possible influx of drugs and alcohol.

Fortune Minerals says the company would still need to invest in a spur road to the mine site, even if the all-weather highway is built.

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