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Nome, AK has a population of just 3,866. So why invest $611 million in its port?

The Port of Nome, Alaska

PortandTerminal.com, January 10, 2020

NOME, AK – The Army Corps of Engineers has announced a $611 million expansion plan for the Port of Nome, Alaska. That’s a lot of money to be investing in a port that serves a local community of just 3,866 people. What’s behind the decision? Here are three reasons.

1. Reduce the cost of goods to help the local community

A rendering of what a deep-draft port in Nome would look like if expansion plans are completed. Image shows wharfs with a tanker and cruise ship both docked
A rendering of what a deep-draft port in Nome would look like when expansion plans are completed.

One reason given is that expanding the port will allow visits from larger ships which in turn will help the local community. The logic goes that by being able to accept larger vessels at its port, the residents of Nome and outlying communities will benefit from lower-cost goods. The bigger the ship, the greater the efficiency and the lower the cost of goods that it brings in by sea.

This is probably the weakest reason for spending $611 million on expanding the port. If you really wanted to help local residents benefit from lower-cost goods, there are cheaper ways to do it. One way would be to change the Jones Act.

READ: Congressman fed up with cost-of-living in Hawaii. Wants changes to Jones Act

The Jones Act forces communities in Alaska (for example) to use only American flagged cargo lines when they import goods. But there aren’t many domestic carriers who fit the bill. That keeps the competition between the few shipping companies who are Jones Act compliant low and the shipping costs they charge their customers high.

The Jones Act is seen by many as a big reason why goods in Alaska, Hawaii and Puerto Rico cost a lot more than they should.

2. Arctic sea routes are opening up

Maersk container cargo ship plowing its way through icy water
As the ice melts, more cargo will be shipped through the Arctic. Nome needs to be ready to accept these larger vessels.

A better reason to invest the $611 million in Nome is to accommodate the surge of larger tankers and cruise ships that will inevitably be using the Arctic sea routes as they open up thanks to climate change.

“Within about 20 years there’s going to be over-the-pole traffic to Europe through the Bering Strait,” vice-chair of the Nome Port Commission Charlie Lean said. “This is the gateway to the ‘new Suez Canal,’ if you will.”

READ: Russia’s Rosatom to turn Arctic Sea Route into the new Suez with $7bn investment

“We’re the furthest north port of entry for the U.S. for customs,” Nome harbor master Lucas Stotts said. “Any [transient vessels] that come over the top need to stop in Nome and that is only going to increase. Whether the locals or anybody else wants it, that traffic is going to increase and we want to be in front of it to make sure we are as prepared to protect the region and help grow with it.”

3. American sovereignty and strategic control

Russian icebreaker Ivan Papanin in port.
Russia launched its weaponized icebreaker Ivan Papanin in October. The vessel can cut through almost five-foot thick ice and is heavily armed.

Finally, one of the best reasons to invest $611 million into the Port of Nome is that America needs to catch up with Russia and China to avoid losing control over the Arctic.

“You don’t have sovereignty unless you can exert it,”

Retired Admiral Thad Allen, former Coast Guard commandant

Put plainly, United States is losing control over the Arctic to Russia and China because it has failed to build the ships, ports and other infrastructure it needs to be there.

READ: Russia unveils weaponized icebreaker as it eyes Arctic oil & gas

The United States is finally building a new Coast Guard icebreaker, the new Polar Security Cutter, but as of yet, there’s no port in the U.S. Arctic where it can dock.  Expanding the Port of Nome gives the new Polar Security Cutter a home and enables America to project its influence in the region.

READ: Why does everyone seem to want a piece of the Arctic?

In the long-run, protecting America’s interests in the Arctic is the smartest reason to spend $610 million dollars expanding the Port of Nome. Everything else is gravy as they say.

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