Construction challenges increase costs at Hiilangaay project, Alaska

22 January 2020

There have been significant cost overruns at the 5MW Hiilangaay hydropower project in Alaska, US, Alaska Power & Telephone Company (AP&T) has announced, with the company’s 2019 results including a pretax charge in the range of approximately $10.5 to $11.5 million, or $8.30 to $9.10 per share, for estimated cost increases.

The project has experienced a number of construction challenges since it began in 2016. Field conditions and design changes have resulted in significant cost overruns above the original project cost estimates, with the additional costs primarily related to the penstock, diversion structure, the powerhouse and sitemobilization. Costs to complete the project in 2020 are estimated to be in the range of $5.5 to $6.5 million.

AP&T is conducting a further review of the project to determine if there are any additional impacts.

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