special section
Environmental Services
Permitting Natural Resources A glimpse at the enormity of time and money for project development
P
BY JOETTE STORM
ermitting. The very word may strike fear in the heart of a resource developer who thinks the permitting process will delay the project and cost a lot of money. In reality, it is a creative collaboration involving land managers and users that protects what belongs to the public while suggesting best practices that lead to successful projects. However, permitting does take time and money. Managing the development of Alaska’s lands, waters and resources in the ”public trust” has given rise to a complex web of permitting procedures that span local, federal and state entities. The body of regulations and laws that guide management of public lands and waters creates challenges and opportunities for users and managers alike. Three agencies provide the bulk of permitting on state land while any number of local or federal agencies have responsibility for approving access to other public lands. Alaska Department of Natural Resources is the primary leasing agent, the Alaska Department of Environmental Conservation has wide-ranging health and safety responsibilities that place it in the middle of permitting functions, while the Alaska Department of Fish and Game scrutinizes the effects of projects on the fish and game and their habitat. A glance at the ADNR website (dnr.alaska.gov/mlw/permit_lease/) gives an idea of the range and type of permits. There are permits for any type of mining, commercial recreation businesses, scientific research and overland travel, among other activities. Some permits are for temporary use, others can cover five to 10 years with provisions for renewal. For example, a backcountry guiding business wishing to establish a base camp complete with yurt and storage facilities on state land will need a lease and perhaps several permits. The lease will cover a five-year period. Government entities, such as the National Resource Conservation Service, intending to install scientific equip-
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ment to measure snow or wind, will also require a permit and pay fees for placement of the device on state land. Aquaculture operations require a lease that starts at $450 for the first acre and a number of permits ranging from $169 to $500. Filing and permit fees can total more than $2,000. The permits set out various requirements, including collecting water samples and sending them to ADEC. The permitting might take six to nine months depending upon the location of the lease and the extent to which other landowners are affected.
Scope and Scale
Larger scale projects such as coal mines or oil and gas development demand coordination among many more players. That is where the Office of Project Management and Permitting comes into play, says Thomas Crafford, OPMP director. His role is to bring all the agencies and the developer to the table to identify requirements and begin what he calls the iterative process of exchanging information about standards and best practices. Crafford’s office ensures that state agencies provide consistent recommendations to the project applicant. However, this service is only available to projects requiring multiple authorizations and whose applicants are willing to pay for the OPMP service, he says. On the federal side, a working group established in 2011 by President Barack Obama’s Executive Order provides similar coordination among all the federal departments with regard specifically to energy resources. David Hayes, deputy secretary of the Interior, heads the group addressing renewable energy projects, including hydropower, biofuels and energy efficiency. Hayes has made two trips to Alaska this year alone for dialogue with agency personnel and members of the public. Both the state and federal governments have lead agencies for large projects. Tom Crafford is state lead for the Chuitna Coal
Project, a 20,571-acre lease on Mental Health Trust Authority land, originally leased in the 1970s, that PacRim Coal LP has proposed a 5,000-acre mine development on. Crafford says the state made a decision to issue the permit in the 1990s to Diamond Alaska, the former operator of the leases, but Diamond backed away from the project at that time. Resurrected in 2006 when the price of coal rebounded, the permitting had to start over due to changing conditions and changing players. The discovery of significant cultural resources required consideration as well, he says. The proposal now includes the surface mine, an all-weather road, electric transmission, an elevated coal transport conveyor, an airstrip, employee housing and the Ladd Landing Development, a coal export facility in the tidelands. In the current round of permitting these last six years, the company has spent in excess of $30 million, according to Joe Lucas, vice president at PacRim Coal LP. PacRim has a Memorandum of Understanding with OPMP that establishes an annual budget for the state employees’ services, he says. Lucas says as part of the consultation process since reinitiating the project, the company has modified its project several times since reinitiating the project. It reduced the number of stream crossings from seven to one due to negotiations with the Tyonek Native Corp., a private landowner whose land is within the larger project area. The elevated conveyor system, agreed to in those negotiations, will allow the use of existing public highways to access the mine, resulting in reduction of new road construction, Lucas explained. Other modifications in design are the result of consultation with the US Army Corps of Engineers, lead agency responsible for permits under certain sections of the Federal Clean Water Act. It is evaluating PacRim’s permit appli-
www.akbizmag.com • Alaska Business Monthly • August 2012