Alaska delegation delivers $249 million to finish Port MacKenzie rail extension

By THE ALASKA STORY

Oct. 19, 2026 – The Alaska Railroad has been awarded $249 million in federal funding to complete the Port MacKenzie Rail Extension, advancing a long-awaited transportation link that Alaska’s congressional delegation says will help move minerals, energy resources, and industrial freight to market.

Sens. Dan Sullivan and Lisa Murkowski and Congressman Nick Begich announced the award Monday with US Transportation Secretary Sean Duffy. The funding comes through the Federal Railroad Administration’s Consolidated Rail Infrastructure and Safety Improvements program, known as CRISI.

The project will complete a 32-mile rail connection between Port MacKenzie’s deepwater facilities and the Alaska Railroad’s main line near Houston, linking the Mat-Su Borough port to the railroad network serving Southcentral and Interior Alaska.

“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,” Sullivan said.

Sullivan said the connection could support mineral development and major energy projects, including Alaska LNG, while improving freight transportation and strengthening supply chains.

“Alaska has enormous deposits of critical minerals, world-class energy resources, and a strategic location at the crossroads of the world,” he said. “But having these resources isn’t enough. We need the infrastructure to develop them responsibly and get them to market.”

The announced completion project totals $311 million, with the federal grant providing about 80% of the funding. The remaining $62 million will come from a non-federal match consisting of in-kind contributions from the Mat-Su Borough and cash contributions from the Alaska Industrial Development and Export Authority and the Alaska Railroad.

The award builds on extensive embankment work already completed along the route. Connecting the port to the railroad would give industrial users a direct link between maritime shipping and inland rail transportation.

Begich said the rail award follows $34 million secured earlier this year to expand Port MacKenzie’s capabilities.

“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,” Begich said.

Begich, vice chair of the House Subcommittee on Railroads and Pipelines, said the connection would support Alaska’s mining, energy, and industrial development.

Duffy framed the grant as an investment in domestic resource production and national security, crediting President Donald Trump and Alaska’s delegation, particularly Sullivan.

“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,” Duffy said.

The announcement follows a July 21 letter led by Sullivan in which all three members of Alaska’s delegation supported the railroad’s application for the full $249 million award.

In August, Federal Railroad Administrator David Fink joined Alaska Railroad officials for an aerial tour of the right-of-way, viewing the completed embankment work and the port district’s potential for industrial development.