The federal government is committing $21.5 million to the Kitikmeot Inuit Association’s slimmed-down request to get the Grays Bay Road and Port project “shovel ready” over the next couple of years.

The funding announcement for the initiative, which is expected to make Nunavut mining projects more economical and potentially reduce cost for community resupply, came Tuesday in Iqaluit. Federal Minister of Transport Marc Garneau was on hand for the occasion.

Nunavut Tunngavik Inc. (NTI) had already announced that it would give $7.25 million to the initiative.

“We are very happy with the outcome… we feel good about where we are,” said Scott Northey, CEO of Nunavut Resources Corporation in regards to the financing from the federal government and NTI.

Through its subsidiary Nunavut Resources Corporation the Kitikmeot Inuit Association (KIA) originally sought $415 million for the $550-million Grays Bay project from Ottawa in but that request was rejected in April 2018.

KIA president Stanley Anablak described the Grays Bay Road and Port as a “nation-building project” while addressing the Transport, Infrastructure and Communities committee in Ottawa on June 4. Anablak compared it to Canada’s nationwide railway construction of the 1800s.

“Grays Bay road would provide the first permanent land-based transportation link between Canada and any part of Nunavut,” Anablak told the committee. “The Government of the Northwest Territories is working closely with us because they want to convert their winter road to an all-season road. They welcome and would benefit from the opportunity to access a port on the Northwest Passage.”

The port would be constructed at the Coronation Gulf while the 230-km all-season gravel road would stretch from the port to the former Jericho diamond mine site.

The road and port project would create 1,260 full-time jobs annually during three years of construction and 1,400 full-time jobs during 11 years of operations, according to an economic assessment by a Yellowknife-based research firm. The report also found that the project would generate $189.5 million for Nunavut’s gross domestic product and the GN would collect as much as $85 million in tax revenues from construction.

For the next couple of years, Nunavut Resources Corporation will focus on completing the environment assessment process, finalizing the design, drilling at future bridge sites along the route and completing community consultations.

The plan is for the Grays Bay road to link up with the NWT’s proposed road through the Slave Geological Province in the future. Northey said the parties on both sides of the border are working cooperatively.

“It would help us if they’re able to unlock some of the excess hydro (power) and connect the Snare River Dam and create some kind of a hydro grid… we could access some of the hydro power and hopefully transmit (it) up the corridor,” he said.

The NWT’s project is estimated to cost upwards of $1 billion.

Northey made it clear to the Transport, Infrastructure and Communities Committee that the Northern Transportation Corridors Fund (NTCF), which has $400 million designated for territorial proposals over 10 years and is the source of the $21.5 million for Grays Bay, is insufficient. He stated that numerous other projects are vying for the funding, far exceeding the pot’s total sum.

“Our view is the NTCF is not large enough in its current form to do any more than to support small components of larger projects,” said Northey. “The NTCF can help to remove bottlenecks within existing corridors, but cannot fund wholesale transformation or development of new trade corridors.”

After listening to Northey, Kelly Block, a Saskatchewan MP and a member of the committee conceded, “It’s obvious that we have completely underestimated the needs for infrastructure development in the North.”