Wrangell lined up for $43M in federal money toward shipyard

WRANGELL, Alaska — The U.S. Economic Development Administration (EDA) plans to give the City and Borough of Wrangell more than $43 million to help build a deepwater port and shipyard and upgrade the town's waterfront and water system.

The borough announced the news on Oct. 2 after U.S. Sen. Dan Sullivan revealed the agency's intent to award the money. It is an intent to award, not a final grant. The borough calls it the largest federal economic development package in its history.

The money comes through the EDA's disaster recovery program and is tied to the November 2023 landslide near Wrangell.

What the money covers

The award would fund three projects:

• The 6-Mile Deepwater Port and shipyard, a public-private development the borough hopes will become Alaska's largest shipyard and a maritime industrial hub for commercial, Coast Guard, NOAA and military vessels
• Downtown waterfront expansion and marine infrastructure improvements, to support marine commerce, transportation, tourism and private investment downtown
• Replacement of the municipal water flume, to make the town's water system more reliable

The borough did not say how the $43 million will be split among the three. It says the projects are expected to create more than 150 permanent jobs and attract hundreds of millions of dollars in additional public and private investment.

Borough Manager Mason Villarma called the award "a generational investment for Wrangell."

The shipyard plan

The shipyard would sit on the borough's 42-acre 6-Mile property, a former mill site on the Zimovia Highway that the borough bought in 2022.

The borough's private partner is JAG Marine Group, which already runs shipyards in Ketchikan and Seward. In February, the Wrangell Assembly unanimously approved a three-year lease of 25 acres to JAG as a placeholder during design, engineering and financing, according to the Wrangell Sentinel. If the project moves forward, the two sides plan to negotiate a lease of at least 40 years once JAG starts earning revenue at the site, with a revenue-sharing arrangement for the borough.

A feasibility study presented in July outlined the shipyard's scale:

• A shiplift with 60 hoists able to lift nearly 38,000 tons, about three times the weight capacity of the Ketchikan drydock
• An assembly hall 560 feet long and 258 feet high, with a 186,000-square-foot footprint
• A sandblasting and painting building

The yard would focus mainly on repairing and maintaining ships, with target customers including the Navy, Coast Guard and research vessels working in Pacific and Arctic waters. JAG has said it wants to handle vessels up to 600 feet. Other planned tenants on the property include Alaska Marine Lines, with a barge ramp and freight yard.

The cost

The $43 million is a starting point. The feasibility study put the full shipyard build-out at $605 million to $726 million, the Wrangell Sentinel reported. Roads, water, sewer and power for the site alone could cost close to $40 million in federal and borough money.

Villarma called the low-end estimate a staggering figure and said funding will come together piece by piece. The shipyard would be privately owned and operated on borough-leased land, with money expected from private investors along with state and federal sources.

The Southeast Alaska Power Agency has said its Tyee Lake hydroelectric station can meet the shipyard's power needs once a third turbine is installed.

Why Wrangell

Wrangell, a town of about 2,000 people, lost jobs when the timber industry declined in the 1990s. Villarma has said the shipyard is the town's best chance in years to create jobs and draw families back, with a goal of growing the population by about 500 people.

The borough sees the project working alongside JAG's Ketchikan yard rather than competing with it. Villarma said much of Alaska's shipbuilding and repair work now goes to yards in the Lower 48, and Ketchikan and Wrangell together could keep more of it in the state.

What happens next

The EDA still has to finalize the award. On the shipyard, full design is targeted for January 2028, and the project needs more than 15 permits, with permitting expected to run from spring 2027 to late summer 2028. Construction could then move ahead in phases as money comes in.

Timeline