On October 19, 2026, the Alaska Delegation and the Department of Transportation Secretary Sean Duffy, announced a federal award of up to $249 million to complete the Port MacKenzie Rail Extension. The project will connect Port MacKenzie’s deepwater port facilities to the Alaska Railroad’s 500-mile main line with 32 miles of new rail.
The Alaska Railroad Corporation (ARRC) received the award through the Federal Railroad Administration’s (FRA) Fiscal Year 2025–2026 Consolidated Rail Infrastructure and Safety Improvements (CRISI) Program. The project is expected to cost $311 million to complete on top of $184 million already spent. In addition to the $249 million federal grant, $62 million will come through a non-federal cost share of in-kind contributions from the Mat-Su Borough and cash contributions from AIDEA and the Alaska Railroad Corporation (ARRC). This puts the total cost of the project at up to $495 million.
In 2025, Rep. Kevin McCabe (R-Big Lake) argued that ARRC’s estimate— at the time $274 million to complete the rail spur in addition to $184 million already spent on embankment and bridges— was overinflated. He stated a more reasonable cost would be $100-$150 million for the new rail. ARRC’s estimate is now over double Rep. McCabe’s estimate at $311 million. According to Rep. McCabe, this overinflated cost “suggests more than just inefficiency—it smells of political maneuvering.”
The rail extension has a long history, first approved in December 2011 with construction beginning in 2012. The project is partly completed with 25.6 miles of embankment and all the bridges in place, leaving 7.2 miles of embankment unfinished and the 32 miles of track to lay. The project is expected to create up to 3,000 jobs and generate $300 million annually in royalties, fees, and taxes. It will also drive economic activity by providing a viable way to transport critical minerals and other natural resources to market.
The Alaska Delegation expressed a hopeful future with the rail extension now fully funded. Congressman Nick Begich had made the Port MacKenzie Rail Extension a particularly focus of his, working as Vice-Chair of the Subcommittee on Railroads and Pipelines in the U.S. House.
“For decades, Alaskans have recognized the tremendous opportunity at Port MacKenzie, but realizing that vision requires sustained investment and a commitment to building the infrastructure necessary to move our resources to market,” said Congressman Nick Begich. “As Vice-Chair of the Subcommittee on Railroads and Pipelines in the U.S. House, I have worked to ensure Alaska’s unique transportation needs remain a priority in Washington. Earlier this year, we helped secure $34 million to expand Port MacKenzie’s capabilities, and today’s announcement of an additional 250 million builds on that progress by advancing the critical rail connection needed to support Alaska’s mining, energy, and industrial development.”
“This is a major win for the Mat-Su Borough and our entire state, and another important step toward unlocking Alaska’s extraordinary resource potential,” said Senator Sullivan. “Alaska has enormous deposits of critical minerals, world-class energy resources, and a strategic location at the crossroads of the world. But having these resources isn’t enough. We need the infrastructure to develop them responsibly and get them to market. This $249 million investment will finally help complete a long-awaited connection between Port MacKenzie and the Alaska Railroad, opening new opportunities for mineral development, supporting major energy projects like Alaska LNG, and creating good-paying jobs for Alaska’s hard-working families. It will also strengthen our supply chains, improve transportation efficiency, and bolster America’s economic and national security.”
Senator Murkowski commented: “This new link will help move cargo, including from resource projects in the area, while improving system safety and reducing shipping times and costs. This is exactly what we envisioned when we included the CRISI program in our bipartisan infrastructure law, and it’s why I continue to push for additional funding through our annual appropriations process. Good things happen in Alaska when we help fund infrastructure investments at the federal level.”
“Alaska is America’s natural resource powerhouse, but the state needs strong infrastructure to get those resources from point A to point B safely, reliably, and efficiently,” commented U.S. Transportation Secretary Sean P. Duffy. “Thanks to President Trump, and Alaska’s congressional delegation—particularly Senator Sullivan—we’re building a massive new rail supply line that will power the energy and critical mineral projects of the future. This landmark investment will generate an economic boom for the region, unleash American energy dominance, and enhance our national security.”
