State braces for a Klondike-style rush for crude and sizes up its treasure trove of mineral riches
Alaska has ''no capacity as an agricultural country, no value as a mineral country, its timber is generally of poor quality. . ., and its fisheries of doubtful value.''Skip to next paragraph
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So concluded the esteemed members of the House Foreign Relations Committee shortly after the United States bought Alaska from Russia in 1867.
Today this gangling state accounts for one-fifth of US oil production, and has Mideast-size pools of natural gas, more arable land than Iowa, forests as thick as a shoe brush, and some of the world's most prolific fisheries.
What's more, all but a handful of the 33 basic minerals used by industry are cloaked somewhere within its icy reaches. The state stands astride one of the world's richest mineral belts, stretching from Siberia to Canada.
No one knows for sure the extent of the riches held by Alaska's mountains, glaciers, and endless tracts of tundra. Besides oil and gas it is known to hold big deposits of coal, peat, and molybdenum as well as copper, uranium, lead, zinc, tin--and, yes, the progenitor of the resource rushes here--gold. All this in an area for which the United States paid less than 2 cents an acre.
Still, getting at these resources is another matter. Just the cost of mining in this harsh environment makes the Foreign Relations Committee's prediction more accurate than its members could have known. Prospective developers also face high costs in moving the material from mine to market. The state has few roads, and its ports aren't equipped to handle huge tonnages.
Then there is the problem of marring one of the world's few remaining wildernesses. Alaska remains a looking glass for the country's ability to reconcile economic development with concern for human and environmental values. The 1980 Alaska Lands Bill didn't end the debate on this matter, but it did help define some of the ground rules. Mineral exploration has picked up since the signing of the measure.
Still, the struggle between developers and conservationists and between the federal and state governments, will continue to shape how Alaska's land is used in the future. As ''Seward's folly'' moves to sever its dependence on oil, some of the energy and mineral resources currently stirring interest here include:
* Natural gas. Potentially recoverable reserves are estimated as high as 109 trillion cubic feet, a five-year supply for the United States. Proven reserves top 26 trillion cubic feet. The chief hurdle in drawing up the gas has been the lack of a transporation link with markets in the ''Lower 48.''
In December federal legislation was passed aimed at easing the financing of the proposed $40-billion-plus Alaska gas pipeline. The move, challenged in court , would allow the pipeline firm to bill customers for construction loans even before the gas begins to flow. But pipeline backers still have to convince skeptical bankers of its feasibility. Despite the hurdles, people from around the country have been trickling into Fairbanks in anticipation of a pipeline ''job boom.''
* Coal. Some 5 trillion tons, as much as half of all US coal reserves, may lie here. Most deposits are locked up in icy northern stretches, likely never to be retrieved. One of the most promising areas is the Beluga field, just across the Cook Inlet from Anchorage in southern Alaska. It may hold several million metric tons of coal. Chief pluses: The coal is close to the surface, near water transportation, low in sulfur content, and is relatively close to big Asian markets.
Big drawbacks: low heat content, high cost of production and transport facilities. The Usibelli Coal Mine Inc. at nearby Healy is the state's only full-time current coal operation. It produces about 750,000 metric tons a year. A Korean firm recently purchased 33,000 metric tons from the company for ''testing.'' Japan, Taiwan, Korea, Hong Kong, Singapore, and the Philippines are envisioned as markets for Alaskan coal.
* Hydro. The state is crisscrossed by several river systems, offering huge water-power potential. More than 150 possible hydroelectric sites have been identified. At least a dozen hydroelectric projects are on the drawing boards or under development, ranging from small diversion channels to mammoth dam proposals.
The biggest and most controversial is a more than $5 billion proposal to build two dams on the Susitna River between Anchorage and Fairbanks. One dam would be 850 feet high, the highest in North America. The project would produce enough electricity to meet most of the state's needs for the rest of the century--or the equivalent of 15 million barrels of oil a year.
Chief concerns include the dam's impact on salmon in the river; the impact of a flood plain on caribou, moose, black bear, and other wildlife; and the siting of a dam in an earthquake-prone area.
* Molybdenum. US Borax has spent $40 million in the past several years developing a mine site at Quartz Hill, in the southeastern panhandle. The area is believed to hold one of the world's largest deposits of molybdenum, perhaps 11/2 billion tons of minable ore. Molybdenum is used to toughen steel alloys. The earliest the operation could start is 1987, although the mine, located in the Misty Fjords National Monument, faces stiff challenges from environmental groups.