Waterfront games: no sure thing except who owns the port

We are encouraged that Selwyn-Chihong wants to use Skagway as its port of choice for its proposed lead-zinc mine in eastern Yukon, and the municipality and its port partners should do everything they can to make this happen – within reason. Skagway and Selwyn-Chihong can learn from past mistakes and make the port work for each other on the existing ore terminal footprint.

In 1968, with no public hearing, the Skagway City Council signed off on a 55-year tidelands lease with White Pass that created the Skagway Ore Terminal for the Faro, Yukon mine haul. Skagway was a company town then and the lease was probably a great idea for its time, but the mining industry is fickle and driven by world metal prices. When prices fell and costs escalated in the early 1980s, the mine closed and the haul collapsed, along with our year-round railroad. Luckily, the town rescued itself by getting behind the cruise industry expansion into Alaska, and the railroad jumped back into the tourism sector, and did well. Yet the city was still stuck with 30 years left on an industrial tidelands lease that should have been half its original length.

Now that the tidelands lease is finally being renegotiated, White Pass may be wise to just pull out of the ore terminal side of the lease with a guarantee that it will be allowed to build a fourth cruise dock to ensure the level of business it needs to remain a viable tourist draw for the community. It is no longer the freight-hauling giant it used to be, and even its parent company has switched from transportation and aerospace to a successful golf course and tourism enterprise. There’s an old adage in business that you stick with what you do well.

However, if the railroad is serious about attracting shippers for a renewed ore haul on the rail line, and the jobs that come with it, then it needs to start by being a more friendly port partner. White Pass’s springing of unprecedented wharfage fees on AIDEA and the Minto Mine last fall is evidently doing the port serious harm, forcing Selwyn-Chihong to advance a more drastic proposal that is not in the best interest of the community: a new ore terminal at the mouth of the Skagway River.

This kind of project was tried once before. When Curragh Resources tried to restart the Faro mine in the mid-1980s it did not want to deal with the White Pass-controlled ore terminal. It tried to partner with AIDEA to build a new ore terminal just south of the Historic District. It talked enough city fathers into having a special election, but a pre-election poll showed less than 20 percent public support for such a boondoggle, and Curragh pulled its proposal. Can you imagine if this south-of-downtown terminal had succeeded and Curragh, which lasted barely a couple of years, walked away? It was far better that AIDEA ended up with the current ore terminal – at least there was something that could be fixed up for later when mining rebounded. And it has.

So now we have history repeating itself, and we trust that Skagway is just as wise this time around, and will be wary of sure thing proposals and promises. We are the Gateway to the Yukon, no mistake about it. And Yukon mines and their global partners can learn to use what we have: a good deep-water port and facilities that are being improved with ample government assistance. Now, we, the community, must dictate how we want that business, and out in the open.

The last thing we want to see is mouth of the river ruined just so a new mining venture can dance around a perfectly adequate port facility. If they are having trouble doing business with all of the parties, then the citizens need to demand the kind of partnerships that will work to bring the business here. You, the citizens, have that power. It’s your waterfront. WJB