Murkowski seeks grant for southwest power plant

FAIRBANKS (AP) U.S. Sen. Lisa Murkowski has introduced a bill to provide a federal grant for a power plant to supply a proposed gold mine and villages in southwestern Alaska.

The bill would allow the Energy Department to grant Calista Corp., the southwestern regional Native corporation, $100 million and guarantee another $50 million in loans for the project.

Murkowski said the project would provide low-cost energy to help the region develop, as the Tennessee Valley Authority and Bonneville Power Administration did in the U.S. South and Northwest during the mid-20th century.

The federal share of project costs would be limited to 80 percent, under the bill.

Placer Dome, an international mining company, wants to develop the Donlin Creek gold deposit on land owned by Calista near the Kuskokwim River village of Crooked Creek. The mine needs 25 megawatts of power at start up, but no source is available.

Building a power plant could convince Placer Dome to develop the mine, Murkowski said.

The proposed power plant would also supply villages along the Kuskokwim, including the 6,000-resident regional hub of Bethel.

A smaller plant still would be advisable even if the mine is not developed, according to a study funded by Calista, Murkowski said.

Electricity costs 50 cents per kilowatt hour in some Kuskokwim villages five times the national average, Murkowski said. Power is produced with diesel generators. The plan is to replace them with coal-fired generators and wind turbines, the senator said.

Cheaper power and jobs from the mine are badly needed in the impoverished region, Murkowski said. Commercial fishing incomes have dropped by 50 percent and almost half the money coming into the region is government assistance.

Calista is the second-largest of the regional Native corporations created by the Alaska Native Claims Settlement Act in 1971.