Tar Sand Oil Dreams

Is BITUMEN going to save the Mat-Su Borough? Does the public really want to allow Bitumen to be shipped through our area?

beverly hillbillies

I posted this note on the Borough Budget Watch Group on November 28, 2018.

msb a 2 a original

* HUGE NEWS * * “MSB Manager’s Special” * The MSB may allow a private Canadian company (A2A Rail USA – i.e. Alberta to Alaska Railway) to fund the completion of and then lease our Rail Spur for 99 years! To ship BITUMEN by rail. Bitumen is tar oil. Shipping it by rail is controversial. The Canadian Gov’t would NOT allow BITUMEN to be shipped from Alberta (which has a lot of this stuff) to British Columbia due to safety and environmental concerns…Thus, investors are trying to find another “tidewater” port to access in order to ship this stuff to Asian markets – primarily China. So, now, A2A and its majority owner – Sean McCoshen – are interested in Port Mac and our rail spur. This new proposed project/deal would also involve various (yet to be sorted out) Port leases etc.

The MSB manager, who downplayed (I don’t think he even mentioned it) what commodity was going to be shipped, is fast tracking this. This is a “MSB Manager’s Special.” As usual, the public and the Assembly were kept in the dark until the very last minute – and now there is a “rush” to sign a contract. Apparently, A2A has been in talks with the MSB (Moosey and our “Internal Auditor” James Wilson) for about 1 1/2 years…but yesterday’s “work session” was the very first time that Moosey has publicly disclosed anything about this potential project. Now the manager wants the MSB Assembly to vote on this proposed project within the next month! This proposal is scheduled to be introduced at the next MSB Assembly meeting with a final vote on Dec 18th.

What about PUBLIC PROCESS? (Also, What about the timber deal? What about the gasline? I guess those projects are now going by the wayside.)

Moosey says that he and the MSB Attorney and A2A are ironing out the details of a contract now. Note: Assembly Member McKee said while he was given a copy of the very rough draft contract, it contained no attachments. McKee asked Mr. McCoshen to please submit a letter outlining his proposal in layman’s language.

Why weren’t the (limited) documents which were given out to the Assembly members made available to the public online or at the meeting?

WHY are the MSB staffers (Moosey, Wilson, and Spiropoulos) ALLOWING the public and Assembly members MERE WEEKS TO REVIEW THIS PROPOSAL? Why can’t the public review the actual contract and have some time to investigate the merits of this proposal?

Where does the State of AK and the AK RR stand on something like this?

WHAT IS IN IT FOR THE MSB? i DIDN’T HEAR ANYTHING ABOUT THE MSB MAKING much if any money off of this proposed deal.

What about safety concerns? Is this why (now former) Assembly Member Kowalke proposed gutting our transportation permitting process?

Note: at the 6 p.m. Assembly meeting following the 4 p.m. work session, Mayor Halter publicly urged Kowalke (who was in audience for both meetings) to apply for the open Port Commission seat. Hmmm…

Local Watch Dog Eugene Haberman attended this A2A Work Session and pointed out (at the public comment period he had to ask to be added!) that this whole thing is very mysterious…First, he said – the “work session” agenda was lacking in ANY DETAILS. The name of the company wasn’t even included on the agenda! (I guess the MSB didn’t want anyone doing any pre-meeting research.) And there was no meeting packet! (The rough draft contract and any other relevant documents should have been included in a meeting packet for the public to review.) Prior to the meeting, Mr. Haberman politely asked the gentlemen who were present and who were obviously there to give a presentation to reveal their names and they refused! They told Mr. Haberman to talk to their attorney – Jonathan Katchen with Holland & Hart – who was also present. Why the lack of transparency asked Mr. Haberman?

Fun fact: Mr. McCoshen and his team flew in by private jet from Canada directly to the Palmer airport. They arrived just 45 minutes prior to the “work session”. McCoshen said this was the only day he had available and that he would be leaving (via his jet) immediately after the meeting. McCoshen said he was born and lived in USA until he was a teen whereupon he moved to Canada with his family. He has law degree but has been in biz for many years including working on Wall Street. He now lives in L.A., California, but travels back to Winnepeg where his company is based all the time.

Fabulous quote from Mr. Haberman: You don’t give away the family jewels. (i.e. why would we gift our port to this private company essentially?)

Note – Google “Sean McCoshen” – he is involved in a recent controversy.

I urge everyone to listen to the MSB work session which took place yesterday at 4 p.m. The video/audio link is on the MSB’s website.

Manager always does stuff behind scenes and then brings it to assembly at very last minute. But I have seen the Alberta to AK railway listed as an agenda item on Port Commission meetings for a while now…and also, I was googling and saw that Mary Lockman did do a story on this 2 years ago..She interviewed the then Port Commissioner. So, while this mostly came out of the blue for the public and Assembly, the Port Commission has been aware of it for a while. See below article by Mary Lockman



December 14th, 2018 UPDATE: 

There is a Port Commission meeting on Monday afternoon (December 17, 2018).

The MSB manager will give an update on the Alberta to Alaska Railway project (which he did not introduce at the Dec 11th Assembly meeting as promised) AND the Port manager will give an update on EARTHQUAKE DAMAGE…Was there any damage to the Port from the earthquake?

January 19, 2019 UPDATE:

There is a Port Commission meeting on Monday, January 21st, 2019 (Martin Luther King, Jr. Day.)

The A2A project is on the agenda again.  (Note: The manager recently announced that he will not bring anything forward to the Assembly until at least February.)

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Links to read:







The Rail Spur…$184 million and counting…

This is information from the MSB’s 2015 CAFR.  It lists the total amount of money allocated and spent for the Point Mac Rail Spur.  These amounts, which are primarily from State of Alaska grants, total $184 million. (There were no State grants after 2015 because that is when the State cut its Capital Budget to practically nothing.)

In addition to the continued development of the industrial district of Port MacKenzie, the Borough is working with the Alaska Railroad to construct a railspur.

They completed a $10 million environmental study to extend the Alaska Railroad 39 miles from Willow to Port Mackenzie.

The Borough also previously acquired $17.5 million to start construction on the rail loop in the Port District.

In July 2010, $35 million more was received for the next phase. This phase constructed 8.1 miles of rail embankment, purchased right-of-way for the remaining rail extension and engineered the route selected by the Environmental Impact Study.

In July 2011,we received another $30 million. These funds were utilized to continue the construction of another 6.5 miles of the rail embankment and to acquire additional right-of-ways.

In July 2012, we received an additional $23.5 million which was for a 4.8 mile section of the project.

Additionally $30 million was approved in a State bond package that was issued in 2013. Those funds were utilized to construct 6.1 miles. Construction began in June 2013.

For fiscal year 2014 the State granted $25 million for the next phase of the project.

And in fiscal year 2015 we received an additional grant in the amount of $13 million. This rail spur will greatly increase natural resource development within the Valley and rail freight transport through the Port.

We have used up almost all of these funds.  I ordered public records from the State for all of the remaining open grants to find out more about how this money was spent.

There are three grants that are not yet closed out – 15-DC-1-4; 14-DC-086; and 13-DC-630 – so it was easiest for the records clerk to send me information from these grants (for the closed grants, she would have had to access the State archives.)

13-DC-630 Grant Agreement and Amendments

13-DC-630 Report 34 – 1

13-DC-630 Report 64 – 36

14-DC-086 Grant Agreement and Amendment

14-DC-086 Reports 20 – 1

14-DC-086 Reports 52 -21

15-DC-104 Grant Agreement

15-DC-104 Reports 1-38