Yukonomist: All the way with A2A!

Finally, a ray of joy! Just when 2020 was feeling like a directionless slog in the dark through half-frozen muskeg, a bold band of positive thinkers brightened our Twitterscape.

It happened on Sept. 25 at 6:15 p.m., old Yukon time. President Trump tweeted that he would issue a presidential permit for the $22-billion Alberta-to-Alaska railway to cross the Yukon-Alaska border. Some 91,300 Twitter enthusiasts stabbed their ‘like’ icons.

Strangely, few of these likes came from politicians in Whitehorse or Ottawa. Thumbs that normally retweet any 140 character synapse spasm even remotely related to northern development decided that 6:15 p.m. was the perfect time for a Twitter cleanse.

It’s hard to know where to start when describing the wonders promised by the Alberta-to-Alaska railway.

First, there is its clever nickname: A2A. It’s snappy and works well with positive chants like “All the way with A2A!”

They probably wanted to go with Alberta-Yukon-Alaska railway, but AYA! is the sound you make as you fall into a bottomless glacier crevasse.

Newspapers in the Lower 48 states and Lower 10 provinces focused mostly on the oil. The railway’s biggest line of business would be shipping 1-1.5 million barrels a day of Fort McMurray crude to Alaskan ports, where it could be put on tankers for China.

Picture the entire production of OPEC-member Algeria going through Watson Lake every day.

What the Outside papers missed was all the other opportunities.

First, it would make the Yukon a geopolitical power. Our premier could simply send the Minister of Something to park one of those old orange YTG pickups across the railway and cut off China from an Algerian amount of oil. We would only let the Politburo off the hook when they promised to clean up the lead-zinc mess left by Chinese government-owned companies at their Wolverine mine.

Second, it would flood the territory with money. A $22-billion project would be like compressing two decades of Yukon government spending into just a few years of hard economic partying.

Even just the YESAB application would create jobs for battalions of consultants from Watson Lake to Ross River to Beaver Creek. Squabbles of lawyers would be needed to negotiate the benefits agreements with First Nations, including several that don’t have self-government agreements.

Third, remember that the 2022 Arctic Winter Games will be in Fort McMurray and the 2024 event will be held in Alaska. Think how convenient the organizers would find having a 500-foot-wide, 2,500-kilometre rail corridor between the two.

The proposal does have a few downsides. The proposed route bypasses Whitehorse completely. Not only does this deprive the Waterfront Trolley of an interconnection opportunity, it will be extremely inconvenient when the 1976 people come in their time machine to finish the Alaska Highway pipeline along its right of way through the city.

After this insult, they’ll have to build the Trump Yukon Hotel in Faro instead of the capital.

Some naysayers have cast doubts on A2A’s ability to generate the $4 billion in annual revenue needed to cover operating and capital costs. A Van Horne Institute economic study estimated that the cost to transport a barrel could range from $12.46 to $21.41 in various scenarios. This is a hefty freight charge when Western Canadian Select is trading around $30, and industry analysts are worried that the world has already reached Peak Oil.

But the naysayers could be wrong. There are potential revenues from mining and other sources. Many thought the White Pass railway would flop when construction started in 1898, but it turned out to be a steady earner for its owners for years.

It’s now up to the proponent to raise the $22 billion needed, which needs to be from private investors and not taxpayers. If they can’t, we should thank them for their vision and optimism, and move on to planning that cold fusion reactor in Whistlebend.

Keith Halliday is a Yukon economist and author of the MacBride Museum’s Aurore of the Yukon series of historical children’s adventure novels. He is a Ma Murray award-winner for best columnist and received the bronze for Outstanding Columnist in the 2019 Canadian Community Newspaper Awards.

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