Grays Bay road and port could be $1B project, proponent estimates

GN, West Kitikmeot Resources Corp. sign MOU at Nunavut Trade Show

From left, David Akeeagok, minister of economic development and transportation, West Kitikmeot Resources Corp. CEO Brendan Bell and Canada Infrastructure Bank CEO Ehren Cory celebrate the signing of a memorandum of understanding for continued support for the proposed Grays Bay road and port project in the Kitikmeot Region Wednesday at the Nunavut Trade Show in Iqaluit. (Photo by Jeff Pelletier)

By Jeff Pelletier - Local Journalism Initiative Reporter

The estimated cost of the proposed Grays Bay road and port project, which would connect resource-rich western Nunavut to the rest of Canada, has nearly doubled according to its proponent.

Brendan Bell, CEO of West Kitikmeot Resources Corp., provided a new cost figure to Nunatsiaq News after signing a memorandum of understanding to continue support for the project at the Nunavut Trade Show in Iqaluit on Wednesday.

“I would estimate that it’s at least a billion-dollar undertaking at this point,” Bell said.

That number is up from a previously estimated $550 million price tag from before the COVID-19 pandemic and recent inflation.

As well, plans for the project itself could be changing.

“We are having discussions with the coast guard and with the Navy about an expansion of the capacity of the port, and so you can think about a cost above $1 billion when you start to change the scope,” Bell said.

The project plan includes a 230-kilometre all-season road and deepsea port.

West Kitikmeot Resources Corp. became the proponent last year after the Kitikmeot Inuit Association pulled out in October 2022.

Since taking over, Bell said his group has begun the permitting process required for a project of this scale and is looking at securing the investment needed to get it built.

He indicated people seem to be receptive to his pitch.

“You can feel the collective eyes of the country on the North,” Bell said.

“That’s for a whole host of reasons, whether it be critical mineral deposits that we recognize we need for the new economy, or geopolitical tensions and the need to know who’s in our waters.”

Bell said his company is looking to have 75 per cent of the cost covered by the federal government and 25 per cent from the private sector.

The other signatories on the memorandum of understanding are David Akeeagok, Nunavut’s economic development and transportation minister, and Ehren Cory, CEO of Canada Infrastructure Bank.

Akeeagok said he feels the memorandum shows the GN will help to be transparent with the project.

“We’ll be sharing the information that’s required for the environmental assessment, and that’s going to help advance the project a little faster,” he said in an interview.

“It’s a major project that really needs time and effort, and people really need to stay focused on it.”

 

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(10) Comments:

  1. Posted by Colin on

    Is there a feasibility study (business plan) for this project that relates to real economic viability? Or is this another northern pipe dream–like the multi-million dollar “research station” at Cambridge Bay?

    Consider, for example, that the economic viability of a railroad to Hay River was readily evident given the extent of the huge Pine Point lead-zinc deposit.

    And when it comes to road-building, I ask what consideration has been given to using hovercraft. How much will it cost not only to build a road but to maintain it? And who will pay those costs? You may recall that for many years ship-sized hovercraft was a standard way to cross the English Channel.

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  2. Posted by I live in the Arctic on

    Hmmm the cost of road maintenance, once/if the NWT mines close will Nunavut have to maintain that portion of road?

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  3. Posted by She Gin Ping on

    The Chinese Communist Party will be greatly encouraged by the news.

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  4. Posted by Not sure on it on

    Aren’t the NWT mines coming close to end of life which means no ice road anymore? Who’s going to pay for the NWT side of things come mine closure day for the Diamond mines?

    I realize there’s potential for new deposits in the NWT but given the rapidly rising costs of things and the difficult regulatory environment it’s likely companies are looking at deposits in other countries.

    Seems highly dependant on NWTs mines to continue the ice road for the feds to pony up 75%. Not only that the future costs of this road I suspect would be extremely high. Look at our road to Tuk. Permafrost melting is ruining it so quickly resulting in pouring more money just to try to combat environmental issues.

    There’s probably other projects that warrant a billion plus dollars that Nunavut badly needs. A little reinvestment in youth for example such as actual facilities like recreation centers that do not exist in most towns, especially the Western Arctic would likely have better yeild than a road where the mass majority of benifits and wealth go to southern hires and mining companies aside from the very token amount that goes to rent a feather companies that pose as majority Inuit owned.

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    • Posted by Lucretius on

      New recreation centers for youth in communities are not going to create enough new income taxes, corporate taxes and GST collected to fund the maintenance or addition to government programs and services in the north, including the new recreational centers themselves.

      Adding new government facilities adds taxpayer cost. It does not reduce taxpayer costs. It means the government has more buildings to maintain and heat and power with the same revenue it already has. It creates burden for everyone, because something else has to be defunded in order to pay for the new buildings.

      Transportation infrastructure such as Greys Bay may reduce taxpayer cost, by reducing how much the government has to spend to bring in its own supplies to operate our communities.

      It can also reduce the cost for ordinary residents meeting their own needs (food, supplies, equipment) and therefore lessening the need to rely on government handouts for these same things.

      And this creates a ton more income taxes, corporate taxes and sales activity that can pay for everything we have now.

      Coupled with potential savings, the government could perhaps afford new recreation centers for youth.

      I am not advocating for Greys Bay. But surely, you have to realize that this potential public investment, like our initial national railway, is just not equivalent to socially directed infrastructure.

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      • Posted by Hold up on

        Were talking about ways to get people to the workforce by actually completing high school which is going to take re-investment in communities. It’s quite clear that job creation isn’t doing it. Evidence is right there in the amount of job vacancies at both mines in the Kitikmeot as well as the GN and very much the private sector alike across Nunavut.

        If you want tax generation, get people into the workforce by ensuring children actually make it through high school so they can pay income tax. Not only do you then also free up significant welfare allocations, but you also have individuals paying into income tax, NU payroll tax, etc. That is creating productivity for Nunavut and Canada as a whole.

        Right now NU is a feeding ground for southern consultants and southern based mines, everyone and their dog knows that routine by this point, find a company or individual, make a bologna company, pay off a penny to the indigenous partner, flow funds south.

        You can see why companies engaging in this process wouldn’t want re-investment into the success of youth in NU. The tap might turn off of the dollars flowing south. But of-course most of the issues go unseen, much like West Kitikmeot Resources all management is housed in the south, work from the south, will stay in the south, and never actually experience any issues within NU itself. But I am sure there will be lots of press on how this will, and they want to help NU.

        Those bleeding hearts, mine management and consultants always seem to be full of staff with them!

  5. Posted by So on

    It’s always easy to come up with reasons not to do something. Maybe roads would encourage development of other resources, perhaps jobs. We certainly don’t want any of that.

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    • Posted by Jobs for who? on

      We already have an excessive amount of vacant positions in Nunavut. Lack of jobs certainly isn’t a thing here.

      The issue is not having qualified people to fill such jobs, hence the importance of reinvesting in youth and not creating a road that exports the majority of wealth generation outside Nunavut.

      Development for southern companies perhaps, but don’t preach northern jobs that’s pure nonsense.

      Little point in having your road when you can’t get kids to finish high school. I think there’s significantly better places for federal money at this time.

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      • Posted by Lucretius on

        Existing government jobs in Nunavut are paid for by federal transfers. This funneling of money north relies on a steady (and increasing) stream of income taxes, corporate taxes and GST collected in southern Canada.

        The amount of income taxes, corporate taxes and GST collected is not keeping pace with spending in Ottawa, and Federal revenues are actually declining relative to our population because Canada is becoming less productive.

        So, I would suggest you consider how money actually circulates in Canada and Nunavut before concluding that there is already enough government jobs up here, or that prosperity in southern Canada has nothing to do with how well off we are up here.

        The truth is, a southern company paying taxes down south, with southern workers paying taxes down south, buying things down south, pay for almost every single thing up here.

        GN has never seen austerity in 25 years. We saw it in the GNWT days leading up to Division in 1999. It is not pretty or painless. At some point, if all we have in Nunavut is GN jobs, we are vulnerable to shocks such as these.

        When Ottawa needs to tighten its belt, and add supports for the growing ranks of the working poor in southern Canada, it is easy to see where those shocks will come from.

    • Posted by Danny Diddler on

      “Maybe” isn’t a justification for spending a billion dollars of southern tax payers money on something that could end up as a melting pile of sludge.

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