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. Last Updated: 07/27/2016

Building Bridges to Billion-Dollar Dreams

Viktor Razbegin has a $50 billion building project that makes the Chunnel between England and France look like a high school science project.

He wants to build a tunnel under the Bering Strait, connecting Chukotka to Alaska, and says it is not only technically possible, but promises to be economically rewarding.

"Russia is a bridge between Asia and America," says Razbegin, director of the government Center for Regional Transport Projects, as he leans back in a stylish leather armchair in his Moscow office.

"But, frankly, we have not been doing a good job," he adds. "We need to use this chance to unite civilization."

A loud train toot interrupts his thought. He turns to a toy train on his desk and picks up its upper half — the train turns into a phone. As he calmly talks into the hybrid handset, an enormous map of Russia's railway system stares at him from the wall.

Trains and maps have been the main ingredients of Razbegin's life for the past 25 years. As a permafrost specialist, he studied the tundra and headed various transportation projects in the far northern regions during the Soviet era.

He also is behind a $20 billion scheme to build a 40-kilometer bridge between Japan and the Russian mainland via Sakhalin Island. The Railways Ministry appears to back the project.

The ministry is less committal on the tunnel to Alaska, if only because the U.S. and Russian governments have not shaken hands on the project. But ministry spokeswoman Yelena Kulakova says it would be "very profitable for the Russian railway industry because it would allow us to compete with a sea-based transportation system."

Razbegin got involved with reviving the idea of building a link to Alaska in 1992 as a spirit of entrepreneurship was sweeping the country. The idea was originally contrived by Russian merchants at the end of the 19th century, shortly after Russia sold the territory to the United States. The venture in its modern form includes building a 6,000-kilometer railway system to connect the Russian and U.S. rail systems.

The project's critics argue that even if this utopian idea were to be executed, the tunnel would link two of the world's most remote, desolate and economically undeveloped areas, where the most common modes of transportation are snowmobiles and dogsleds.

A spokesman for Alaska Governor Tony Knowles said the main problem with digging the tunnel is that "there is nothing on either end," The Wall Street Journal reported.

Razbegin's bearded face melts in a smile as he hears the argument — it is the one he has to rebut most often:

"The crucial thing everyone misses is that this venture is not about a tunnel. It is about developing adjacent territories and creating new jobs," he says. "It can be done through building infrastructure to connect Asia with North America via Russia."

That infrastructure would include a railroad, a joint electricity system and a set of telecommunication lines, including fiber-optic cables.

The first step would be to lay 3,200 kilometers of railroad to connect Chukotka with BAM, the Baikal-Amur Railroad. More than 2,000 kilometers of track would also have to be laid on the North American side to line the tunnel to the main U.S. railway system.

The tunnel itself would run much longer than the 37-kilometer Bering Strait. Razbegin's research team proposes a tunnel as long as 103 kilometers to bypass the rough terrain along the coasts.

According to Razbegin, the project has received the go-ahead from the Economic Development and Trade and Railways ministries and the Academy of Science. His interdepartmental center is affiliated with all three.

Opponents of the Chukotka-Alaska link argue it would be a financial fiasco.

"I cannot imagine, given the extreme expenses, even with China and the rest of Asia connected, that a railroad linking Siberia and North America could be economically viable for a long time to come," says Ilya Vinkovetsky, who is doing doctoral research at the University of California on Russian migration and the history of Alaska and Chukotka.

He says the history of failed expectations for the Trans-Siberian Railroad and BAM suggest that skepticism is justified. "It is difficult to imagine a proposed railway across the Bering Strait being competitive with shipping across the Pacific," Vinkovetsky says in an e-mail interview.

Razbegin objects, insisting the project has numerous potential revenue streams and a high likelihood of profitability.

For instance, he says, the railroad would shorten the shipping route across the Pacific by 10 to 14 days and could quickly become the preferred way of shipping goods between Asia and North America.

Razbegin estimates the Chukotka-Alaska railroad could carry 30 billion to 40 billion tons of cargo annually.

In addition, he says, building a joint Asia-Russia-North America electricity line could ring in savings of about $15 billion a year. The United States imports electricity from Russia.

Once the U.S.-Russia railroad was complete, export transit would bring Russia about $20 billion annually, Deputy Railways Minister Sergei -Grishin said in September at the Baikal Economic Forum held in Irkutsk, according to the web site of a transportation sector newspaper called Gudok.

But even if Razbegin succeeds in shattering his skeptics' fears about the economic unfeasibility of the project, he still has to find $50 billion to $60 billion in financing.

"This is not a lot of money," he says. "For example, it would be possible in a framework of a joint government project between Russia, the United States, Canada, and possibly Japan and China."

According to Razbegin, many potential investors have already expressed an interest in the project, which he boasts will turn a profit for first-tier investors within the first five to seven years of operation.

He admits this is not the easiest undertaking. Ten-month-long winters feature temperatures below minus 50 degrees Celsius, while short summers bestow overflowing rivers and unrelenting insects. Yet Razbegin is confident the project is technically viable.

"First of all, [thousands of years ago] Alaska and Chukotka were connected, so there are actually some technical advantages," he says, "Secondly, mankind by now has a lot of experience in building large, complex projects."

Razbegin himself is experienced in such projects, or at least in launching them. His second much-criticized brainchild is the scheme to build a 40-kilometer bridge between the Japanese island of Hokkaido and the Russian mainland via Sakhalin.

Both projects, he says, are part of the same goal — creating an enormous intercontinental railway system.

Despite the criticism, Razbegin and his team were able to secure the government's permission to start work on the Sakhalin bridge, which he says will cost roughly $20 billion and take about 15 years to complete.

The Railways Ministry spokeswoman confirmed that the project is going ahead. Railways Minister Nikolai Aksyoneko was quoted by Interfax this week as saying that by the end of next year, his ministry "really will start construction of the tunnel under the Tatarsky Strait, which will connect the mainland with Sakhalin."

Razbegin is sure the same fait awaits the Bering Strait scheme. Now that he has sent the results of a "successful" feasibility study to the U.S. and Russian governments and developed a draft of investor proposal, all Razbegin says he needs is "a decision on the highest level."

In 1995, the two governments almost signed an agreement that would give the green light to the undertaking, but the Russian government officials in charge were changed so frequently that the Americans backed down.

"I know this project will be realized," Razbegin says. "If tomorrow the two presidents signed the deal, you could start buying tickets for the train that will be ready to depart in 20 years."