SGC Nunavik Final Report v15 Public

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    TableofContents

    Page

    1. Executive

    Summary

    provided

    by

    the

    Kativik

    Regional

    Government

    (KRG)

    4

    2. Introduction 9

    3. Methodology 10

    4. FibreOpticNetworkOptions 10

    a. IndicativeFibreonlynetworkoption 11

    b. ArcticFibreInc.Proposal 18

    c. Terrestrial

    Fibre

    options

    20

    5. MicrowaveRadioOptions 21

    6. SatelliteOptions 24

    7. SummaryofOperatingExpensescostestimate 26

    8. EnvironmentalAssessmentConsiderations 26

    9. FibreOpticNetworkCostComparisons 28

    10. Interconnection

    Options

    34

    11. OverallComparisonofSatellite,FibreOpticsandMicrowaveRadioTechnologies 37

    12. ComparisonofNetworkExpansionAlternatives CostandOperatingExpenses 41

    13. ProjectedProjectImplementationtimes 44

    14. Conclusions 44

    Appendices

    Attachments

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    ListofFigures

    1. IndicativeFibreOpticNetworkOption 11

    2. Major

    Shipping

    Routes

    15

    3. ExtentofNunavikMarineRegion 16

    4. ArcticFibreIncCanadianNetworkProposal 18

    5. ArcticFibreNetwork 19

    6. NANFibreOpticNetwork 20

    7. IndicativeMicrowaveRadioDesign 23

    8.

    CombinedFibrewithRadioLinktoSchefferville 29

    9. FibreRingwithMicrowaveRadiotoSmallerCommunities 30

    10. CombinedFibreandSatelliteNetworkOption 31

    11. MapofRailwayfromSeptIslestoSchefferville 34

    12. EeyouCommunicationsNetwork 35

    13. IllustrativeComparisonofTelecommunicationsBackboneNetworkAlternatives 40

    Listof

    Tables

    1. TideFluctuationsinNunavik 13

    2. SatelliteCapitalCostEstimateinExistingRemoteEarthStations 25

    3. CapitalCostEstimateforKaBandGatewayEarthStation 25

    4. SatelliteNetworkCostEstimateforCandKBand Technologies 26

    5. CapitalCostComparisonforFibreOpticNetworkAlternatives 32

    6. FibreOptic

    Network

    Options

    Recurring

    Costs

    33

    7. NetworkAlternativesthatMeetKRG2021CapacityRequirements 42

    8. NetworkAlternativesthatmeetKRG2016CapacityRequirements 43

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    1. SummaryofPrefeasibilityStudyforahighcapacitynetworkinNunavik(providedbyKativikRegionalGovernment,KRG).

    GoaloftheStudyThe

    goal

    of

    the

    study

    was

    to

    provide

    KRG

    with

    the

    feasibility,

    cost

    and

    timeframe

    for

    building

    ahigh

    capacity

    networkinNunavik.

    Thecapacityrequirementswerebasedprimarilyontwocriteria.ThefirstwastoallowTamaaniInternetto

    meettheCRTCrecommendedgoalofprovidingInternetservicewitha5Mbsofactualdownloadspeedby

    2015.Theprojectedneedsfor2016(below)wereestablishedonthisbasis.Thesecondcriterionusedwasto

    lookathistoricalgrowthofnetworkusageonTamaaniInternetsnetworkfrom2004to2012whichincreased

    30fold.ItisreasonabletoassumethatasworldwideInternetrequirementscontinuetogrowTamaani

    Internetsnetworkmustkeeppace.A30foldincreaseisthereforeexpectedtobenecessaryby2021.

    The

    study

    looked

    at

    new

    technologies

    to

    meet

    these

    needs

    because

    current

    technology

    will

    not

    scale

    to

    meet

    growingdemand.Inordertomeetthe2016targetswithcurrenttechnology,thecapacityofafullsatellite

    dedicatedtoNunavik,estimatedtocost$25millionperyear,wouldberequired.Tomeetthe2021targets

    usingcurrenttechnology,thecapacityofthreecompletesatellites,estimatedat$75millionperyear,wouldbe

    needed.Clearly,anewapproachisneededtomeetthegrowingdemand.

    TheparametersprovidedbyKRGareasfollows:

    Community Currentcapacity

    Mbs(satellite)

    ProjectedNeed

    2016Mbs

    Projectedneed

    2021Mbs

    Akulivik 10 100 300

    Aupaluk

    10

    100

    300Inukjuak 25 250 750

    Ivujivik 10 100 300

    Kangirsuk 10 100 300

    Kangiqsualujjuaq 10 100 300

    Kangiqsujuaq 10 100 300

    Kuujjuaq 65 650 1950

    Kuujjuarapik 18 180 540

    Puvirnituq 29 290 870

    Quaqtaq 10 100 300

    Salluit 19 190 570

    Tasiujuaq

    10

    100

    300Umiujaq 10 100 300

    Total 246 2460 7380

    Theconsultantwasaskedtoevaluatethefeasibility,costandtimeframeofbuildinganetworktomeetthese

    targets.Inaddition,somevendorprovidedsolutionsproposedbyArcticFibre,TelesatandiCommwerealso

    evaluated.

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    FeasibilityThestudydeterminedthattherearethreefeasibletechnologiestomeetthegoals:

    1.

    Underseaopticalfibrenetwork

    2. Microwavetowernetwork

    3. Highcapacitysatellitenetwork

    Inallscenarioswithunderseaopticalfibreormicrowavetowersweassumethatwewouldbeableto

    interconnectwiththeEeyouCommunicationNetworkinChisasibiandviaaproposedfibreopticnetworkthat

    maybebuiltfromScheffervilletoSeptIsle.Thetransportfromthesenortherncommunitiestothesouthadds

    asignificantoperatingcostbecauseoftheirownremotenessfromurbancenters.

    Inadditiontothese,severalscenarioswereexaminedinwhichtwoormoreofthesetechnologieswouldbe

    usedtogethertooptimisethecost,performanceandstabilityofthenetwork.Atotalofsevenscenarioswere

    analysed:

    1. UnderseafibreringtoallcommunitieswithlandbaseopticalfibrefromKuujjuaqtoSchefferville;

    2. ArcticFibresproposaltoconnectelevencommunitieswithunderseafibreandthreewithmicrowave

    towers;

    3. UnderseafibreringtoallcommunitieswithmicrowavetowersfromKuujjuaqtoSchefferville;

    4. Underseafibretoninecommunities(includingDeceptionbay),microwavetowerstosixcommunities

    andmicrowavefromKuujjuaqtoSchefferville;

    5. Underseafibretoeightcommunities(includingDeceptionbay),highspeedsatellitetofive

    communitiesandahighspeedsatelliteteleportinKuujjuaq;

    6. HighspeedsatellitetoallcommunitieswithsomeCbandsatelliteretainedforNorthernvillageto

    Northernvillage

    applications;

    7. Microwavenetworktoallcommunitieswhichwouldonlymeetthe2016objectiveof2.5Gbsbutnot

    the2021objectiveof7.4Gbs.

    Itshouldbenotedthatthesetechnologiesarenotnecessarilyequal.Microwavetowersandhighcapacity

    satellitesaresusceptibletoadverseeffectsfrombadweatherandradiofrequencyinterference,although

    modernsatelliteequipmentcan,inmanycases,mitigatetheeffectsofweatherwithlittleornoimpacton

    performance.Thedesignsforsatelliteandmicrowaveweredonewithanavailabilitytargetof99.99%.An

    opticalfibrenetworkisnotsubjecttoweathereffectorradiofrequencyinterference.Highspeedsatellite

    technologyhashighlatencyandcontinuestobeproblematicforlatencysensitiveapplicationswhichwillnot

    functionwell,oratall,inahighlatencyenvironmentregardlessofthespeedofthenetwork.Latencyisnotan

    issuefor

    microwave

    towers

    or

    optical

    fibre

    networks.

    The

    high

    speed

    satellite

    scenario

    that

    was

    studied

    is

    asymmetrical;itsdownloadcapacitywouldmeetthebandwidthtargetbuttheuploadcapacityissignificantly

    lower.Asymmetryisastandarddesigninsatellitenetworkingandistypicallyadequateformostpresentday

    needs.Itisdifficulttopredicttheimpactofthisdesignconsiderationonnetworkusagethatwillbeoccurring

    fifteenyearsintothefuturewithuploadintensiveapplicationssuchascloudcomputingbecomingmore

    common.Opticalfibreandmicrowavetowernetworksareinherentlysymmetricalandthisissueisnota

    concernwiththesetechnologies.Lastly,opticalfibrecouldbeeasilyandinexpensivelyupgradedtovastly

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    exceedthe2021goalof7.4Gbswhereasbothmicrowavetowersandhighspeedsatellitewouldrequire

    significantcapitalexpendituretoupgradeafterthenetworkisbuilt.Itshouldbenotedhoweverthatwhile

    opticalfibreistechnologicallycapableofprovidingvirtuallyunlimitedbandwidth,therealityisthatoptical

    fibrenetworkgrowthwouldbelimitedbytheinterconnectioncostwithnorthernproviders.

    Thetimeframeforconstructionofprojectsisestimatedattwoyearsforanysolution.Anenvironmental

    impactassessmentwouldberequiredforanopticalfibrenetworkandisestimatedtotaketwoyears.Fora

    microwavetowernetwork,theestimateddurationoftheenvironmentalimpactassessmentwouldbeone

    year.Noenvironmentalimpactassessmentisexpectedforasatellitenetwork.Thetotaltimeframetobuilda

    highcapacitynetworkisthereforeestimatedattwotofouryears.

    Inthescenariosthatwereexamined,anopticalfibreormicrowavenetworkwouldrelyonagreementswith

    existingnorthernprovidersandinthecaseofconnectingthroughSchefferville,reliesonanetworksegment

    thathasyettobebuilt.Thisintroducesasignificantamountofuncertaintywithregardstothosescenarios.

    TheexceptionistheArcticFibreprojectwhichproposestobuildaselfhealingnetworkwiththreeseparate

    pathstotheInternet.AccesstoArcticFibresinternationalbackbonewouldprovideanadvantageintermof

    reliabilitytheeventofasinglebackbonecablebreak,asopposedtoanetworkthatwouldinterconnect

    exclusivelytonorthernQuebecproviders.

    SummaryofcomparisonOpticalFibre MicrowaveTowers HighSpeedSatelliteVerylowlatency Lowlatency Highlatency

    Highmaximumcapacity Lowmaximumcapacity ModerateCapacity

    Symmetrical(uploadand

    downloadcapacity

    are

    equal)

    Symmetrical(uploadand

    downloadcapacity

    are

    equal)

    Asymmetrical(uploadcapacityis

    lowerthan

    download

    capacity)

    Veryhighavailability Moderateavailability(subjectto

    rainfade)

    Highavailability(somewhat

    subjecttorainfade)

    Lifespan2030years Lifespan20years Lifespan1520years

    Inexpensivetoupgradebeyond

    2021goal

    Highcosttoupgradebeyond

    2016goal

    Highcosttoupgradebeyond

    2021goal

    Longertimetobuild(~4years)

    (environmentalassessmentfor

    landandwater)

    Moderatetimetobuild(~3

    years)(environmental

    assessmentforland)

    Shortertimetobuild(~2years)

    (noenvironmentalassessment

    expected)

    Interconnectionisexpensive

    (transportfrom

    Chisasibi/Scheffervilletosouth)

    Interconnectionisexpensive

    (transportfrom

    Chisasibi/Scheffervilletosouth)

    Interconnectionisinexpensive

    (gatewayisinthesouth)

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    CostsandTimeframeAsummaryofcapital,operatingandtotalcostsforeachisasfollows:

    SystemConfiguration CapitalCost AverageAnnual

    OperatingCost

    TotalCost

    (notadjusted

    forinflation)

    TotalCostperyear

    AllFibreOption $158M $6.2M $282M $14.1M(20years)

    ArcticFibre $135M1

    ($155M)2

    ArcticFibreusesa

    "Utility"business

    model,andongoing

    costsare

    dependenton

    the

    numberofuserson

    thesystem

    ArcticFibreusesa

    "Utility"business

    model,andongoing

    costsare

    dependenton

    the

    numberofuserson

    thesystem

    Costperyearwill

    dependonUtility

    pricing.

    Fibreplusmicrowave

    KuujjuaqtoSchefferville

    $139M $6.3M $265M $13.3M(20years)

    Fibreplusmicrowaveto6

    communitiesand

    Schefferville

    $132M $7M $272M $13.6M(20years)

    Fibreplussatelliteto5

    communities

    $130M $5M $202M $13.7M(15years)3

    $10.2M

    (20

    years)

    3

    SatelliteKaBandandCband

    $94M $2M $125M $8.3M(15years)

    AllMicrowave(Didnotmeetallcriteria)

    $68M $4.8M $164M

    $8.2M(20years)

    1ArcticFibreprovidedcoststhatassumeda5%contingency

    2Thestudyuseda20%contingencyinallcostestimatesandthisvaluereflectscostsprovidedbyArcticFibrebutcalculatedat20%

    contingency3

    Expected

    lifespan

    of

    optical

    fibre

    is

    20

    years.

    Expected

    lifespan

    of

    asatellite

    is

    15

    years.

    The

    amortisation

    is

    shown

    at

    both

    15

    and

    20

    yearssincethisoptionusesbothtechnologies.

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    AnalysisOnthebasisofpuretechnologicalmerit,anopticalfibrenetworkissuperiortoasatellitenetworkfor

    broadbandInternetapplications.However,ourstudyshowsthatonthebasisofpureeconomicmerit,next

    generationKa

    band

    satellite

    may

    be

    superior

    for

    at

    least

    fifteen

    more

    years,

    with

    one

    important

    caveat:

    this

    solutionwouldcontinuetoimpairordeprivetheregionfromtheuseoflatencysensitiveapplications,the

    financialimpactofwhichisdifficulttoevaluate.BothsolutionsareviabletomeetNunaviksnetwork

    requirements.

    Microwavetowertechnologyhastwoimportantlimitationswhencomparedtotheotherdesignsthatwere

    studied.Firstly,lackofroadaccesstothetowersincreasestheyearlyoperatingcostlargelystemmingfromthe

    requirementforhelicopteraccesstotowersites.Secondly,microwaveradioscapableoffunctioningin

    NunaviksharshweatherconditionshavelesscapacitythannextgenerationKabandsatellitetechnologyand

    quitesubstantiallylessthanopticalfibre.Forthisreason,weconsiderthatwhileamicrowavetowernetwork

    technically

    is

    viable,

    Nunaviks

    network

    requirements

    are

    too

    high

    to

    pursue

    this

    option.

    ConclusionThestudyconclusivelydemonstratesthatbuildingahighcapacitynetworkforNunavikisfeasibleandallows

    formuchgreatercostefficiencythaniscurrentlybeingachievedwiththeexistingnetwork.

    ThecommercialvalueoftheCbandsatellitecapacitycurrentlyinusebytheKRGtoprovideInternetservicein

    Nunavik,includingcapacityobtainedthroughtheNationalSatelliteInitiativeandBroadbandCanada:

    ConnectingRuralCanadians,combinedwiththeexpensesofoperatingthecurrenttransportnetwork,is

    approximately$5.2millionperyear.

    Whilethecapitalcostofanewnetworkissignificant,whencalculatedovertheanticipatedlifespanthe

    averageyearlycostis50%to150%greaterthanthecurrentnetwork.However,thisnewnetworkwouldhave

    uptothirtytimesmorecapacitythantheexistingnetworkandsolveNunaviksmajortelecommunications

    challengeforatleastfifteentotwentyyears.

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    2. Introduction

    TheKativikRegionalGovernment(KRG)commissionedastudywithSalterGlobalConsulting(SGCINC)

    to determine the feasibility of connecting the 14 communities in Nunavik with high speed

    telecommunicationand

    internet

    services.

    KRGrequiredthatthefollowingtechnologyoptionsbeexamined:

    a) Undersea Fibre Optic Cable options, including the proposal that has been offered by Arctic

    FibreInc.

    b) TerrestrialFibreOpticalternatives.

    c) TerrestrialHighCapacityMicrowavealternatives.

    d) HighSpeed

    Ka

    Band

    Satellite

    options,

    including

    the

    Telesat

    Ka

    Band

    payload.

    Foreachoption,KRGrequiredthatthefollowingissuesbeaddressed:

    i. Technicalfeasibility,takingintoaccounttheclimateandgeographyofNunavik.

    ii. Anticipatedinstallationtimeframes.

    iii. Environmentalandregulatoryconsiderations.

    iv. Longtermtechnicalperformance,includingtheprojectedsystemavailability.

    v. Systemdiversityandredundancyoptionsintheeventofamajorsystemfailure.

    vi. Estimatedlifespanofeachalternative.

    vii. CostEstimates,includingbothcapitalandoperatingcosts.

    viii. SystemInterconnection

    Intheevaluationoftechnicalandnetworkalternatives,acriticalparameteristheforecastdemand

    fromeachcommunity.KRGprovidedthefollowingforecast:

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    Estimatedrequirements:

    Community Current

    capacityMbs

    (satellite)

    Projected

    Need2016

    Mbs

    Projectedneed

    2021Mbs

    Akulivik 10 100 300

    Aupaluk 10 100 300

    Inukjuak 25 250 750

    Ivujivik 10 100 300

    Kangirsuk 10 100 300

    Kangiqsualujjuaq 10 100 300

    Kangiqsujuaq 10 100 300

    Kuujjuaq 65 650 1950

    Kuujjuarapik 18 180 540

    Puvirnituq 29 290 870

    Quaqtaq 10 100 300

    Salluit 19 190 570

    Tasiujuaq 10 100 300

    Umiujaq 10 100 300

    Total 246 2460 7380

    3.Methodology

    Firstly, SGC INC evaluated the technical, cost and performance parameters of the fibre optic,

    microwave radio and satellite alternatives to meet the needs of the KRG demand profile, on a

    standalonebasis.

    Next, SGC INC reviewed alterative network and technical configurations using a combination of

    technologiestomeettheprojectedincreaseindemandovertime.

    Finally,thesealternativeshavebeensummarizedintermsofcapitalcost,operatingcost,performance,

    installationschedule,andpotentialrisk,andriskmitigationelements.

    AlistofsubcontractorsengagedbySGCINCisshowninAttachment1,togetherwithalistofpotential

    supplierswhowereconsultedaspartofthiscontract.

    4. FibreOpticNetworkOptions

    The network options proposed in this section are all based on a fibre "ring" architecture, with a

    minimum of two entry/exit interconnection points. This permits traffic to flow in both directions

    aroundthering.Intheeventofafibrebreak,allcommunitiesconnectedtotheringcanmaintainfull

    traffic service by routing traffic in either direction to avoid the break. This ring type architecture is

    typicallyusedinlonghaulmarineandterrestrialfibrenetworkarchitectures.

    Thissectionisdividedintothreecomponents:

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    a) Anassessmentofanindicativestandalonefibrenetwork"ring"architecture.

    b) AreviewandcomparisonwiththeproposalmadebyArcticFibreInc.

    c) AreviewofterrestrialoptionsforNunavik.

    a) Indicativefibreonlynetworkoption.

    Figure1(below)showstheproposedindicativefibrenetworkoption.Inthismodel:

    An interconnection point at Chisasibi is proposed with Eeyou Communications network,

    providingaccesstosouthernCanada.

    AsecondinterconnectionpointisproposedatSchefferville.Note:AfibrelinktoSchefferville,

    connecting with southern Canada network is currently proposed, using the existing railway

    rightofway.

    ThefibrelinkbetweenKuujjuaqandScheffervilleisaterrestrialsystem

    Remainingconnectionsarebasedonmarinefibrelinks,withexceptionofaterrestriallinkfrom

    UngavaBaytoKuujjuaq,andanumberofshortterrestriallinksaspartofthefibreopticcable

    landings at selected communities (as a result of depth, tide, or potential coastal scouring

    issues).

    Figure1 IndicativeFibreOpticNetworkOption

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    Adetaileddescriptionoftheproposednetworktogetherwithcosts,cableroutingconsiderationsand

    nauticalchartsofproposedlandingsisshowninAppendix2.

    KeySystemDetails:

    Fibrelength

    3,566

    km

    (2,907

    km

    marine,

    659

    km

    terrestrial,

    including

    link

    between

    Kuujjuaq

    andSchefferville)

    Capacity 12fibremarinecable(6fibrepairs). Inthisreport,itisassumedthatonefibrepairis

    equipped, initially with one 10 Gbits DWDM optical channel (DWDM Dense Wavelength

    DivisionMultiplexing).ThisfullymeetstheKRG2021trafficrequirementswiththepotentialto

    meetaveryhighexponentialtrafficgrowthinthefuture,ifrequired.

    Note:Eachfibrepairhasaveryhighultimatecapacity(100Gbsperopticalchannel,andatotal

    of88DenseWavelengthDivisionMultiplexing(DWDM)opticalchannels

    Technicalinterfacesatlocalcommunities twotypesofinterfacehavebeenprovisionedinthe

    report:

    A1GbpsEthernetinterface(SpecificationIEEE802.3,1.25Gbps)

    TheoptiontointerfaceatastandardTelcoDS1,DS3,(ITUspecificationG703),andOC3

    andOC12(GR253CORE).Theseinterfacewouldmostlikelybeapplicabletoindustrial

    and/orveryhighusagecustomers

    Systemlifetime designlife,20yearsminimum.

    DesignConsiderations:

    IceScouring

    Ice scouring represents a potentially significant risk to the integrity of the fibre optic cable,

    particularly at cable landing sites and areas near the shore line. In general, the backbone

    networkisnotatrisksoficescouring.

    Thestudyevaluated literatureregarding icecharacteristicsonthewesternshoreofHudson's

    BayandinUngavaBay.ReferencedocumentsareshowninAttachment2.

    Insummary,

    the

    principal

    risk

    in

    the

    area

    of

    interest

    is

    fast

    ice

    (ice

    that

    is

    landfast

    or

    anchored

    tothe landmass).Themovementofthis ice isdeterminedbywinds,currentsandsalinity.A

    principal risk occurs from ice rafting, where one slab of ice is driven on top of a second ice

    sheet,withtheresultsofascouringactiononthebottom. Theestimatesreceivedonthelimit

    ofthis icescouringareapproximately2metres (approximately6.56 feet)belowthenominal

    seabedfloor. Inthereview,anominal3metres(approx9.85feet)depthhasbeenassumed.

    Icebergsoccursinthevicinityof:

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    FoxeStraight

    UngavaBay

    InthevicinityofFoxeBay,themarinebackbonecableissufficientlydeepthaticebergsdonot

    representathreat.

    In

    other

    areas,

    water

    depth

    of

    the

    mainline

    fibre

    cable

    has

    been

    selected

    to

    be inexcessof100metres (Attachment3shows indicativedepthsof theproposedmainline

    fibrecable).Forcabledepthsbetween200metresand100metres, lightarmouredcablehas

    beenselected.Fordepthslessthan100metres,doublearmouredcablehasbeenused.

    Cablelandingtechnologies

    The landingsrepresentasignificantportionoftheoverallcostofthenetwork.Three landing

    technologiesareproposed:

    Underseaburialusingamarinecableplough.

    "SplitPipe"construction thistechniqueusesaheavygradesplitsteeltosurroundthe

    cablefromtheforeshoreuntilanappropriate,safedepthcanbereached.

    Horizontal Directional Drilling this is the most expensive and typically requires

    significantheavyequipmentonshoretoexecutethedrilling.

    Thestudyhasassumedamixoftechniquesbasedonadesktopstudyand literaturereview.

    Thistechnologymixhasbeenintegratedintothedesktopstudycostestimates

    Tides

    Tidesvary

    considerably

    around

    the

    coast

    of

    Nunavik,

    with

    the

    largest

    fluctuations

    occurring

    in

    UngavaBay.Table1showstidedatafromtheCanadianHydrologicalService.

    Table1TideFluctuations Nunavik

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    Installationtechniqueshavebeenselectedtoaccommodatethevaryingtideconditions.

    Asanexample,itisproposedtouseaterrestriallinkfromUngavaBaytoKuujjuaq,inpart,asa

    resultoftheextremetidalrangeintheregion.

    Waterdepth

    Ingeneralthedeeperthecableplacement,thesaferthesystemfromexternalthreatssuchas

    shipping, fishing, ice scouring and icebergs. The depth of the mainline fibre link is shown in

    Attachment3.Themajorityofthebackbonelinkisatawaterdepthofgreaterthan100m.

    Light armoured cable is proposed for depths below 400 m. For depths between 400 m and

    100m, single armour cable is proposed and for depths less than 100m, heavy duty, double

    armourcableisproposed.

    Cablechafing

    Cablechafingcanbeaseriousissueformarinecables.Itisextremelyimportantthatthecable

    be laid directly on the seabed floor and not in a manner where there is a possibility of the

    cablebeingsuspendedbetweentwoseabedoutcrops. Inthiscase,thecontinuousmotionof

    tidalactionandcurrentswillchafethecabletothepointoffailure,sometimes inarelatively

    shortperiodoftime.

    As a result, an underwater marine survey is a critical step in the determination of the final

    cableplacement.

    Systemavailability

    Theavailabilityofmarinefibreopticsystemsisveryhigh;typicallyinthe99.999%rangewhen

    a ring architecture is employed. The electronic and optoelectronic equipment in a modern

    fibre system is usually configured in a "selfhealing ring" configuration, to increase overall

    systemreliabilityandavailability.

    Theprincipalvulnerabilitiestoacorrectlysurveyedand installedsystemaremanmade. Over

    90% of marine cable system failures are the result of external sources (shipping, anchor

    dragging,fishingetc).Figure2showsmajorshippingroutesinthearea.

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    Figure2 MajorShippingRoutes(Reference:DepartofFisheriesandOceans)

    Thechallengeforanarcticmarinesystemisthetimetorepairintheeventthatacablefailure

    occurs in the winter season, and the cable is therefore inaccessible. This vulnerability

    reinforcestheneedforafibreringarchitecture.

    Installationscheduling

    Thestudy initiallyconsidered thepossibilityof installationof themainline fibrecable ring in

    phases,howeverthiswasconsideredtobeexcessivelycostlyandinefficient.

    AmoderncableshipcanaccommodateallofthefibrecablefortheNunavikmarinemainline

    link without the need to return to its base. When cable is layed directly on the sea floor, a

    moderncableshipcanmaintainacable layingspeed,undergood"bluewater"conditions,of

    between 4 and 7 km/hour. A typical rate of between 3 km/hour and 4 km/hour can be

    achieved.Cablelayingspeedsaresignificantlylesswhenamarineploughisusedtoburycable,

    andforinstallationsclosetoshorelines.

    Evenifbadweather,delaysandotherissuesareconsidered,itisbothfeasibleandefficientto

    lay the mainline link in one summer season. The additional mobilization and demobilization

    costsincurredbyasplitinstallationseasonforthemainline(backbone)projectwouldbevery

    high.

    This,however,doesnotmeanthatthelandingswouldhavetobeinstalledatthesametime.It

    isrecommendedthattheinitialsystemconfigurationbedesignedsothatalloftheanticipated

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    underwaterbranchingunitsareidentifiedandprovisionedduringthemainlineinstallation. It

    ispossibletoreturnata laterdate,whendemand issufficient,toconnect localcommunities

    throughacablelandinginstallationtothepreinstalledbranchingunit.Itisconsiderablymore

    expensivetoretroactivelyinstallanunderwaterbranchingunit.

    EnvironmentalAssessmentandPermitting

    Figure3belowshowstheextentoftheNunavikMarineRegionthatisadministeredbyvarious

    regulatoryagencies.ThemapalsoidentifiesCategory1,2and3LandAreasasdefinedbythe

    James Bay and Northern Quebec Agreement, and the Nunavik Inuit Land Claims Agreement

    (

    2

    0

    0

    7

    )

    .

    Figure3 ExtentofNunavikMarineRegionwithrespecttoEnvironmentalAssessment

    The proposed fibre optic system is entirely within the boundaries of the Nunavik Marine

    Region.

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    In general, environmental assessment is a process to predict environmental effects of

    proposedinitiativesbeforetheyarecarriedout.

    Anenvironmentalassessment:

    identifiespotentialadverseenvironmentaleffects

    proposesmeasurestomitigateadverseenvironmentaleffects

    predicts whether there will be significant adverse environmental effects, after

    mitigationmeasuresareimplemented

    includesafollowupprogramtoverifytheaccuracyoftheenvironmentalassessment

    andtheeffectivenessofthemitigationmeasures.

    There are five major review agencies that impact the proposed Nunavik fibre optic network

    froman

    environmental

    review

    perspective

    i. KativikEnvironmentalQualityCommission(KEQC)

    ii. NunavikMarineregionalImpactReviewBoard(NMIRIB)

    iii. FederalEnvironmentalandSocialImpactReviewBoard(COFEXNord)

    iv. CanadianEnvironmentalAssessmentAgency(CEAA)

    v. DepartmentofFisheriesandOceans(DFO) Navigation,protectionoffisherieshabitat

    (includingfreshwaterhabitats),andtheSpeciesatRiskAct(SARA).

    Attachment4outlinesthe responsibilitiesoftherespectiveagencies,andtheprocesses that

    willlikelybeneededtosecurethepermitsfortheproject.

    In summary, the process is initiated by a Project Description Report (PDR) which outlines

    "potential adverse effects" and proposes mitigation techniques to minimize these adverse

    effects.EnvironmentalReviewagenciesreviewbothnaturalandsocialeffects,andthetestfor

    inclusion inthe initialstagesoftheapplicationsarerelatively lowtogiveeachcommunityor

    potentiallyaffectedpartytheopportunitytoparticipateandshareviews. Theoutcomeofthis

    stage of the process is typically some form of Preliminary Environmental Assessment, which

    givesthe

    proponent

    an

    indication

    of

    the

    likely

    terms

    and

    conditions

    that

    will

    need

    to

    be

    met

    priortoformalapplicationsforpermitting.Thenextstageoftheenvironmentalreviewprocess

    usesahigherlevelofthresholdthatistypicallydefinedas"significantadverseeffects."Public

    consultationsandengagementareanimportantelementateachstepoftheprocess.

    Onceallofthereviewprocessesarecomplete,theproponentisrequiredtoformallyapplyfor

    therequiredpermitstoimplementtheproject.

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    Using similar infrastructure projects as a guide, it is estimated that the length of the entire

    processfromideatopermitscouldbeintherangeof2years.

    CapitalandOngoingestimatedcosts:

    CapitalCost

    =$153.9M

    (assuming

    a20%

    contingency

    allowance).

    Ongoingcosts=$2.3Mperyear(excludinginterconnectconnectioncosts).

    b). ArcticFibreInc.Proposal

    ArcticFibrehasproposedaCanadianmainlinemarinenetworkasshowninFigure4.

    Figure4 ArcticFibreIncMainlineMarineCanadianNetwork

    ArcticFibreINChasprovidedcostestimatesforservingall14communitiesinNunavikplusDeception

    Bay.Figure

    5shows

    the

    Arctic

    Fibre

    design

    to

    serve

    the

    communities

    in

    Nunavik

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    Figure5 ArcticFibreNetwork

    Insummary,theArcticFibreproposalisdividedintotwosections:

    i. A marine backbone section comprising a distance of approximately 1,400 km. This

    networkconnectswiththeproposedArcticFibretransCanadianArcticFibrenetwork,and

    provides an alternative spur route to Chisasibi broadly following the western shore of

    Nunavik(connectingattheEasternHudson'sBayUnderseaBranchingUnit).

    Thecapitalcostestimate for thebackbonenetwork isbetween$55Mand$65M (witha

    5%contingencyallowance).

    ii. A localnetwork connecting individualcommunitiestothebackbonenetwork.Thetotal

    distance for these individual connections is approximately 1,400 km. The capital cost

    Kuu ua

    Tasiu a

    Au aluk

    Kan irsuk

    Qua ta

    Ivu ivik

    Puvirnitu

    Akulivik

    Inuk uak

    Umiu a

    Kuu uara ik

    BrisaRadisson

    Kan i su ua

    Salluit

    Existin Fibre Links

    Chisasibi

    Existing

    FibreEastHudson

    ProposedArctic

    Dece tion Ba

    Kan i sualu ua

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    estimateforthe"localconnectinglinksandlandings"networkisbetween$80Mand$90M

    (witha5%contingencyallowance).

    iii. MicrowaveradiolinksfromKuujjuaqtoKangiqsualujjuaq,TasiujaqandAupaluk.

    iv. AterrestrialfibrelinkfromUngavaBaytoKuujjuaq.

    v. Arctic Fibre has indicated that the installation schedule for the Canadian portion of the

    route is contingent on Government of Canada approval, marine surveys and carrier

    support.

    In terms of availability, the network proposed by Arctic Fibre can be configured in a ring

    configuration. Thismeansthattheexpectedavailabilitycouldbeinthe99.999%region.

    c). TerrestrialFibreOptions

    The KRG Statement of Work required the study to review the technologies employed in the

    NorthernOntarioPickleLakefibreopticinstallationforsuitabilitytoNunavik.

    Attachment 5 provides a summary of the Northern Ontario Broadband Fibre Optic Network

    located in the Nishnawbe Aki Nation (NAN) territory. Figure 6 shows the extent of the NAN

    network

    Figure6 NANFibreOpticNetwork,NorthernOntario

    TheNANnetworkextendsforapproximately2,645km,connecting26communitiesand

    coveringanareaofapproximately2,600sqkm.

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    Eachcommunitywillhaveaccesstoa2.5Gbstransportlinkand8x1GbsEthernetlinks.

    Thetotalnetworkcomprises:

    1,185kmaerialconstruction

    140kmburiedcable

    1,320kmsubmarineinstallation.

    Forapproximately90%oftheNANrouting,eitherallweatherorwinterroadsexist.Thismeans

    thatheavyequipmentcanbedeployedalongtheroadstofacilitateinstallation.

    For the Nunavik terrestrial installations, the study found that a number of construction

    techniques employed in Northern Ontario would not necessarily be applicable in Nunavik,

    primarilyasaresultofthelackofroadinfrastructure.

    5. MicrowaveRadioOptions

    The KRGStatementofWork required thestudy to reviewmicrowave technologyoptions to provide

    highspeedservicetoNunavikcommunities.

    Thestudyconsideredtwomicrowaveradiodesignalternativesbased, initially,ontheprojected2016

    trafficrequirementsprovidedbyKRG.

    i. Adesignusingacombinationof:

    An

    11

    GHz

    system

    operating

    at

    1200

    Mbps

    A5GHzsystemwithacapacityof200Mbps

    A900MHzadministrationandtelemetrysystem

    Theantennasforeachsystemwouldsharecommontowerstructureswithanaveragedistance

    between towers of approximately 40 km. Hybrid power systems (solar, wind, battery and

    dieselgeneratorbackup)areproposedatintermediatesites.

    ii. Adesignusinga6Ghzmicrowaveradiosystem.Thissystempermitsa longer"skip"distance

    betweenradiotowers,andhasthepotentialtoeliminatetheneedformultipleradiosystems

    tomeetsystemavailabilityrequirements.

    Thestudyfocussedonanindicativenetworkdesignusingthe6GHzradiooptions.

    Threemicrowaveradiooptionsforthe interconnectionofahighspeedNunaviknetworktosouthern

    Canadawereconsidered:

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    i. ConnectionfromKuujjuaqtothenorthernextentoftheHydroQuebecfibreopticnetworkat

    Brisay, Quebec. After further evaluation, the study concluded that it is unlikely that Hydro

    Quebecwouldallowconnectionwiththeirexistingfibrenetwork.

    ii. A

    microwave

    radio

    link

    from

    Kuujjuaq

    to

    Schefferville.

    This

    has

    the

    potential

    to

    link

    with

    a

    proposedextensionofafibrelinkthatcurrentlyextendsfromSeptIslestoLabradorCity.The

    proposedrightofwayfortheextensiontoScheffervillecouldfollowtheexistingrailwayright

    ofway.

    iii. ConnectiontotheexistingEeyouCommunicationssystemnetworkatChisasibi.

    a) Indicative Microwave Radio Design to serve all 14 communities in Nunavik, in a ring

    configuration

    Appendix4shows

    the

    network

    design,

    civil

    works,

    equipment

    and

    powering

    costs

    for

    amicrowave

    "ring"networktopologyservingallofthecommunitiesinNunavik,andhavingsouthernCanadian

    interconnectionpointsatChisasibiandSchefferville.

    Thedesign isbasedona totalcapacityof1.3Gbs.This figurecanbedoubled insize to2.6Gbs

    usingthesamecivilworksinvestment.Costestimatesareprovidedforbothoptions.

    A key parameter for microwave radio design is radio path planning. This determines the overall

    performanceofthemicrowavesystem,andprovidesthelocation,andheights,oftheradiotowers.

    Figure7showstheindicativeradiotowerdesign.Thereareatotalof50microwaveradiotowers

    withheights

    that

    vary

    between

    amaximum

    of

    90

    metres

    to

    aminimum

    of

    5metres.

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    Figure7 IndicativeMicrowaveRadioDesign

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    Theproposedpowersystemformicrowaveradioequipmentisbasedonahybriddesigncomposedof

    thefollowingcomponents:

    14x240wsolarpanels

    2x1kwwindturbines

    1x5kw

    arctic

    diesel

    generator

    Theradiolinkshavebeendesigntoanetworkcarrier99.99%availability.

    Insummary:

    CapitalCost=$52Mto$57Mfora1.3Gbscapacitynetwork.

    Recurring costs estimated at 4% of capital cost = between $2.0M and $2.5M, plus annual

    licencefeesofapproximately$0.5Mperyear.

    Fora2.6Gbscapacitysystem,itisestimatedthatthe:

    o CapitalCost between$65Mand$70M

    o Recurringcost=$3.5and$4.0M

    6. SatelliteOptions

    AllKRGcommunicationsneeds inNunavikarecurrentlyservedsolelybyCBandsatellite technology

    forinternetandgovernmentadministration.Sinceitsinitialdeploymentin2002on11MHzofsatellite

    bandwidth,theKRGSatellitenetworkhasgrowntotoday's129MHz.

    Thecurrent

    internet

    distribution

    service

    is

    based

    on

    astar

    topology,

    where

    each

    community

    is

    linked

    toasouthernInternetGatewayatSiouxLookout.Thecorporateinternetnetworktopologyisbasedon

    amesharchitecture,wheresinglehopremotetoremotecommunicationissupported.

    At the projected rate of traffic growth, current infrastructure using Telesat's Anik F3 CBand space

    segmentisnottechnicallyscalabletomeetdemand.InadditionincrementalcostsofincreasedCBand

    capacity, estimated at $25 million per year for a full Cband payload, would be very challenging to

    support financially. The KRG network is experiencing exponential growth significantly exceeding the

    capabilityofthecurrentCBandnetwork.

    For future expansion of the KRG satellite network, the study proposes a network configuration

    consistingof:

    Ka Band technology to meet the majority of the increased demand, noting that KaBand

    systems do not support a mesh network topology. KaBand technology also offers a very

    significant cost advantage over CBand, sometimes as high as an order of magnitude less

    expensive. KaBand technology would permit KRG to meet its forecast bandwidth

    requirements.

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    Retaining a modest CBand capability using existing network equipment to support current

    customerMESHbased. Itisestimatedthat16+5MHzcapacitywillberequiredtomeetthis

    requirement.

    Tables

    2

    and

    3

    provide

    an

    estimate

    of

    capital

    cost

    expenses

    to

    support

    a

    Ka

    Band

    ground

    stationcapacityinNunaviktomeetKRG'strafficrequirements,basedprimarilyoninformation

    providedbyTelesat.

    Summary Est. Price

    RF equipment $1.7 M

    Baseband Equipment $4.0 M

    Construction $0.5 M

    Installation $0.23 M

    Professional Services $0.26 M

    Logistics $0.15M

    Total $6,8 M

    Per si te $0.43 M

    Table2 EstimateofCapitalExpensesrequiredtodeployproposedKa

    bandnetworkinfrastructureinexistingKRGRemoteEarthStations

    Summary Est. Price

    Electronics $3,7MProfessional Services $0.12M

    Total $3,8M

    Table3 EstimateofCapitalExpensesrequiredtodeploytheproposed

    Kabandnetworkinfrastructureinthegatewayearthstation

    TheKaBandnetworktopology is limitedtoastarconfiguration.Usinganestimateof2Mbs

    percommunityforthemeshnetworkdemand,thistranslates intoatotalrequirementof28

    Mbs.

    Using

    the

    current

    technical

    configuration

    of

    the

    C

    Band

    network,

    this

    represents

    approximately16MHzor50%ofatransponder.

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    EstimatedCostforCbandNetwork

    Assuming that all internet traffic is transferred to the proposed KaBand network, it is

    estimatedthatanadditional5MHzofCBandcapabilitywillberequiredintheoutyearsofthe

    study

    to

    maintain

    a

    minimum

    MESH

    network

    capacity.

    The

    estimated

    cost

    to

    KRG

    of

    this

    C

    Bandspacesegmentisbetween$200Kand$250Kperyear,onceexistingcontractagreements

    expire.

    7. SummaryofOperatingExpenseEstimate

    ThefollowingtablesprovidesanestimateoftheoperatingexpensesforacombinedKaBand

    andCBandnetwork,assumingaSTARconfigurationfora7.2GbsKaBandnetwork,anda20

    MbpsMESHCBandnetwork.

    Years(2016 to2030)

    Ka-BandSpace Segment

    C-BandSpace Segment

    InternetConnection

    Ka-BandUplink

    C-BandUplink

    NetworkOperation

    Totals $70M to $90 M $1.8M to $2.5M $6.3 M $9 M $1 M $24 M

    Table4 Estimatedcostsofanindicativesatellitenetworkusing

    CbandandKaBandtechnologyfor15yearperiodfrom2016to2030

    8. EnvironmentalAssessment

    Considerations

    Itisanticipatedthattheenvironmentalassessmentcostsandtimeframeswillvarybetween

    thedifferenttechnologyoptions.

    a) FortheFibreOpticalternatives,thefollowingassumptionshavebeenmade:

    FortheportionofthenetworkthatfallsundertheNunavikregulations(NunavikLandClaimAgreements,JamesBayAgreement,KativikEnvironmentalQuality

    Commission,MunicipalitiesasdefinedundertheKativikActetc),thattheproject

    wouldbelikelyconsideredinthe"greyarea",asdefinedbyregulations.Thiscould

    meanthat

    the

    project

    would

    likely

    not

    be

    considered

    in

    the

    same

    way

    that,

    for

    example,aminewouldbeconsidered,butthattheprojectwouldneedtoidentify

    potentialareasofrisk(includingpotentialadverseaffects)andpossiblemitigation

    options.Publicconsultationswouldbeacriticalpartoftheprocess.

    FortheportionoftheprojectthatfallsundertheNunavikMarineArea,itisanticipatedthatresponsibilitywouldbesharedamongst:

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    Figure8 combinedfibre,withradiolinktoSchefferville

    Kangiqsualujjuaq

    Aupaluk

    Kangirsuk

    Salluit

    Puvirnituq

    Akulivik

    Inukjuak

    Umiujaq

    Kuujjuarapik

    BrisayRadisson

    Kangiqsujuaq

    Chisasibi

    NewDigitalMicrowaveLink

    ExistingFibreLinks

    ProposedFibreLinkExistingFibreLinks

    DeceptionBay

    Ivujivik

    Quaqtaq

    Tasiujaq

    Kuujjuaq

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    Afibrering,withmicrowaveradioservingsmallercommunities,asshowninFigure9.

    Thisoptionprovidesforanextensionofthemicrowaveradiosystemtosmallercommunitiesthat

    can

    be

    more

    economically

    served

    by

    radio.

    Themixedfibre/radionetworkfullymeetstheKRG2021forecastdemandrequirement.

    Figure9 Afibreringwithradioprovidingservicetosmallercommunities

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    Afibreringwithsatelliteprovingservicetosmallercommunities,asshowninFigure10.

    This option provides a combination of satellite (both CBand andKaBand) together with a fibre

    backbonenetwork.

    Thenetwork

    fully

    meets

    the

    KRG

    2021

    capacity

    requirements.

    Figure10 Combinedfibreandsatellitenetworkoption

    Kuujjuaq

    KangiqsualujjuaqTasiujaq

    Aupaluk

    Kangirsuk

    Quaqtaq

    SalluitIvujivik

    Puvirnituq

    Akulivik

    Inukjuak

    Umiujaq

    Kuujjuarapik

    Brisay Caniapiscau

    Radiss

    on

    Kangiqsujuaq

    Chisasi

    bi ExistingFibreLinks

    ProposedFibreLink ExistingFibreLinks

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    Table5showsacapitalcostcomparisonoffibrenetworkoptions:

    In this analysis, the baseline cost estimate of the indicative fibre optic network, which assumed all

    landingswouldbeimplementedusingsplitpipetechnology,hasbeenincreasesby$15M(forOption1)

    toprovide

    an

    allowance

    for

    Horizontal

    Directional

    Drilling

    in

    those

    circumstances

    where

    it

    is

    necessary

    toprotectthelandingcableandmeettheoverallsystemavailabilityrequirements.

    SystemConfiguration CapitalCostof

    FibreOptic

    System($M)

    FibreOptic

    CableDistance(km)

    Other

    SystemCosts($M)

    Comments

    Option1AllFibre

    IndicativeNetwork $154M 3,566 Landingoption buriedplus

    splitpipeconstruction. Marine2907km

    Terrestrial

    659

    km

    Option2ArcticFibre

    ProposalSecondaryNetworkPrimaryNetwork

    $80M $90M1

    $55M $65M1

    1,4001,400

    Excludeslandlinkto

    Scheffervillediversityprovided

    byArcticFibremainnetwork.1

    Calculatedusing5%contingency

    Option3IndicativeFibre

    Networkservingall

    communitieswithRadio

    linkingKuujjuaqto

    Schefferville

    $125M 3,050 $10M1.2Gbit/s

    capacity

    microwave

    radiosystem

    fromKuujjuaq

    toSchefferville.

    Landingoption buriedplussplitpipeconstruction.

    Marine2907km Terrestrial143km

    * Assumesadditional$12.8M

    forHDD

    Option4Combinedfibre

    andmicrowaveradio.

    $98M 2,546 $31.2M(Microwave

    radio) Landingoption buriedplus

    splitpipeconstruction. Marine2415km Terrestrial131km

    * Assumesadditional$10.7M

    forHDD

    Option5Combinedfibre

    andsatellite

    $98M 2,584 $27.1M(Satellite)

    Assumessatelliteserving5communitiesplusringbackup

    fromKuujjuaq.

    Table5 CapitalCostComparisonforfibreopticnetworkalternatives

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    Table6showsrecurringcostestimatesforfibreopticnetworkalternatives:

    Inthisanalysis:

    LicensingcostforMicrowaveRadioandSatelliteoptionshavebeenincluded.

    Maintenancecosts

    have

    been

    included

    on

    the

    following

    basis:

    o FibreOpticsystems 1.5%ofcapitalcostsannually

    o Satellitesystems 1.7%ofcapitalcostsannually

    o MicrowaveRadiosystems 4%ofcapitalcostsannually

    Thesecostsincludemaintenanceandrepair,systemoperation,technology(hardwareand

    software)upgrades

    SystemConfiguration

    TotalEstimated

    SystemCapital

    Costs

    EstimatedAnnual

    OperatingCosts

    (excludingsystem

    expansioncosts)($M)

    TotalCost

    in

    $2013,

    excludinginflationover20years

    (15forsatellite)($M)

    Option1AllFibre

    IndicativeNetwork$154M $2.3M $277M

    Option2 ArcticFibre

    Proposal

    $143M ArcticFibreusesa"Utility"

    businessmodel,andongoing

    costsaredependentonthe

    number

    of

    users

    on

    the

    system

    ArcticFibreusesa"Utility"

    businessmodel,and

    ongoingcostsare

    dependent

    on

    the

    number

    ofusersonthesystem

    Option3Indicative

    FibreNetworkserving

    allcommunitieswith

    RadiolinkingKuujjuaq

    toSchefferville

    $135M $2.4M $259.4

    Option4Combined

    fibre,microwave

    radio.

    $129M $3.1M $268.4

    Option5

    Combined

    fibreandsatellite $125M $1.9M $184.4

    Table6 FibreNetworkOptions,RecurringCosts

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    10.InterconnectionOptions

    For

    the

    microwave

    radio

    and

    fibre

    optic

    network

    alternatives,

    two

    network

    interconnections

    are

    required to the southern Canada mainline telecommunications network, to complete the

    recommended"ring"configurationsinordertomeetnetworkavailabilityrequirements.

    Fouralternativeshavebeenconsidered:

    a) ConnectiontotheHydroQuebecnetworkatBrisay thisalternativehasbeenproposedby i

    CommasacomponentoftheirmicrowaveradioproposalfromKuujjuaqtoBrisay.

    Afterfurtherconsideration,thestudyconcludedthatisextremelyunlikelythatHydroQuebec

    would

    permit

    public,

    carrier

    type,

    telecommunications

    traffic

    that

    may

    be

    subject

    to

    regulation,over its internalcommunicationsnetwork.Thisnetworkalternativewastherefore

    notconsideredfurther.

    b) Connectionwithaproposedfibre linkatSchefferville thisalternative isbased, inpart,ona

    proposedextensionofthefibrelinkfromLabradorCitytoSchefferville,usingtherightofway

    of the Tshiuetin Rail Transportation Inc (Tshiuetin Rail Transportation Inc. has acquired the

    northern section of the rail line of the QNS&L Railway, including the Menihek Subdivision,

    whichrunsbetweenEmerilJunction,NewfoundlandandLabradorandSchefferville,Quebec).

    Figure11showsrouteoftherightofway.

    Figure11 MapofRailwayrightofwayfromSeptIsletoSchefferville

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    The connection with a high speed fibre link at Schefferville, perhaps with a partnership

    arrangementwiththecurrentfibreopticprojectproponents,wouldprovidehighspeedaccess

    tosouthernCanadanetworksthatwouldmeetthenetworkcapacityrequirementsofKRG.

    c) Connection

    with

    the

    Eeyou

    Communications

    Network

    (ECN)

    at

    Chisasibi.

    Figure

    12

    shows

    the

    currentECNfibrenetwork.

    Figure12 EeyouCommunicationsNetwork

    EeyouCommunicationshaveexpressedaninterestinworkingwithKRGprovidingahighspeed

    fibre optic transport facility to southern Canada. Traffic from the proposed KRG high speed

    networkwould

    terminate

    in

    Chisasibi,

    and

    be

    transported

    by

    ECN

    to

    St.

    Felicien,

    for

    onward

    connectiontosoutherntelecommunicationnetworks.

    Thereisapotentiallongtermissueofcapacity.Thecurrentcapacityofthenetworkis2.4Gbs.

    ECNhasaplantoexpandtheJamesBaynetwork,whichwouldsignificantlyincreasecapacity.

    FromtheperspectiveofKRG,therearethreeoptionsforconnectionwiththeECN.

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    i. IncludeacapitalcostallowanceintheKRGnetworkestimateforexpansionoftheECN

    network, to meet the term KRG traffic requirements. This could be implemented in

    termsof:

    1) An

    Indefeasible

    Right

    of

    Use

    (IRU)

    agreement,

    where

    KRG

    would

    have

    unrestricted access to a defined number of fibre pairs or Dense Wavelength

    DivisionMultiplexeropticalchannelsforaspecifiedperiod(e.g.20years). In

    this arrangement,ECN could be contracted to maintain andoperate the IRU

    channelsforanagreedfee.

    2) ApartnershiparrangementwithECNthatcouldincludetherightofECNtouse

    a potential southern interconnection gateway at Schefferville using the

    proposedKRGnetwork,toprovideroutediversityfortheECNnetwork.

    ii. Alongtermbulkpurchaseagreementthatwouldbesimilartoagreementsinsouthern

    Canada

    with

    respect

    to

    interconnection

    at

    defined

    Points

    of

    Presence

    (PoP).

    In

    southern Canada, PoP agreements are often regulated by the Canadian Radio and

    TelevisionCommission(CRTC),butasimilarlegalframeworkcouldbeadoptedforthe

    connectiontotheECNnetwork.

    iii. ApartnershipwithECNforanextensionoftheECNnetworkintoNunavik.

    d) ArcticFibre in this networkoption,ArcticFibrewould inherentlyprovidenetworkdiversity

    throughinterconnectionsinsouthernCanadathroughanextensionoftheArcticFibrenetwork

    throughChisasibitoMontreal,andutilizing linksthroughother interconnectionpoints inthe

    ArcticFibrenetwork.

    Foreachofthesenetworkalternatives,therearetwocoststobeconsidered:

    1) ThecostoftransportfromthesouthernterminioftheproposedKRGnetworktoa

    southernCanadaPointofPresence(PoP).

    2) ThecostofinterconnectionatthesouthernCanadianPoPtoTier1carriers.

    Forsatellitenetworkalternatives,thecostestimatesincludebackhaultoasouthernCanadianPoP,

    buttheincrementalcostsofinterconnectionatthePoPneedtoconsidered.

    InterconnectionCost

    Assumptions

    a. ForabulktransportationcostfromChisasibitoStFelicien,andsimilarlyfromScheffervilleto

    SeptIsles,$50,000permonthperGbshasbeenassumed.

    b. ForinterconnectioncostsatsouthernCanadianPoPlocations(StFelicienandSeptIsles),an

    averageof$15permonthperMbshasbeenassumed

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    11.OverallComparisonofSatellite,FibreOpticsandMicrowaveRadio

    Technologies

    Ingeneral,comparisonoftechnicalalternativesfortelecommunicationsbackbonesystemsneedstobe

    based on specific applications. There is no one size that fits all and, in most cases, a combination of

    technologiesmayrepresentthemostcosteffectivemethodologytomatchincreasingdemandswiththe

    fastchangingcostdynamicsofindividualtechnologyoptions.

    However, each technology does have specific advantages and disadvantages that are based on the

    underlying science associated with each option. A global overview of technologies is provided in the

    WorldBank'sBroadbandStrategiesHandbook{PublishedbytheWorldBank(InfoDev)March2nd,2012

    http://www.infodev.org/articles/broadbandstrategieshandbook}. The following sections provide a

    summary

    of

    each

    technology,

    and

    a

    generic

    comparison

    of

    cost

    versus

    capacity

    of

    the

    three

    options

    consideredinthisstudy.

    a) FibreOptics.

    FibreOpticsystemsare fundamentallycharacterisedbyhigh initialcost,extremelyhigh capacity,high

    performanceandflexibilityofapplications.

    i. Currentopticalfibres(typicallyconfiguredinpairs,oneforthe"go"direction,andtheother

    fibreforthe"return"direction)havethecapacitytocarryupto100Gbsperopticalchannel,

    andamaximumofindependent88opticalchannelsperfibrepair.

    ii. The

    performance

    of

    operating

    fibre

    optic

    systems

    worldwide

    has

    been

    proven

    to

    be

    very

    high.Fibresystemshavelowlatencyandpropagationdelays(signalstravelatapproximately

    90% of the speed of light as an example, a 5,000 km system has a propagation delay of

    about20ms).

    iii. Opticalfibresareessentiallyimmunetointerferencefromradiofrequency(RF),weatherand

    spacebasedinterference.

    iv. Lifetime Opticalfibrehasarelativelylongoperationallife(upto30years).

    Thetwoprincipaldisadvantagesare:

    v. Cost fibre systems are characterized by a high initial capital cost compared to other

    technologiesformostcurrentlevelsofdemandinNorthernCanada.

    vi. Vulnerabilitytoafibrecablebreak,particularlyinspring.

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    Inthereport,ithasbeenassumedthatthefibrecablewillbeburiedinshallowareasand

    areasclosetotheshore.Ithasalsobeenassumedthat,insomecases,horizontaldrilling

    willbeemployedtoincreasethe"robustness"ofcablelandings.

    Thereport

    includes

    estimates

    for

    repairing

    cable

    breaks,

    based

    on

    available

    data

    of

    fibre

    cablereliability.

    Worldwide,over90%offibresystemfailuresaremanmade,andalmostallfailuresoccurnear landing.

    Foramarinesystem,thistypicallymeansanchordraggingorfishingasapossiblecause.

    To mitigate a cable break, fibre networks are almost always configured in a "ring" configuration, as

    proposed inthisstudy. Intheeventofabeak,signalscanbererouted intheoppositedirectioneither

    sideofthebreak.

    b) Satellite

    Satellites have a long history of providing communication in Northern Canada. Although the cost is

    relativelyhighintermsofcapitalinvestmentforthesatelliteowner/operator,therecentintroductionof

    KaBandtechnologyhassignificantlyreducedpricelevelscomparedtoexistingCBandtechnology.

    A principal advantage for satellite communications is cost for remote communities, and where the

    demand over a relatively large geographic area is modest. Satellite operators essentially provide

    financingandtechnologysupportforthespacesegmentportionofthesatellitelink.

    Inaddition,theconstructionphaseofthissolutionwouldberelativelysimpleandrapidcomparedtothe

    other solutions. Ground infrastructure is located in towns/communities with easy to access.

    Environmental

    Assessment

    is

    typically

    minimal,

    and

    this

    option

    features

    reuse

    of

    some

    existing

    infrastructure.

    i. Satellitesare typically located in ageostationaryorbit,approximately 36,000km fromearth.

    Thisimposesapropagationandlatencytimedelaythatissignificantforsomeapplications.For

    thisstudy,acombinationofameshnetworkarchitecture (using CBand technology)andKa

    Band,usingastartnetworktopology,hasbeenrecommended.

    ii. Performanceofsatellitesystemsistypicallygood,offeringanavailabilityof99.99%

    iii. Thehighreliabilityofsatellitesystemsiswelldocumented,butoutagescanoccurduetospace

    basedweather

    phenomena

    and

    other

    failure

    mechanisms.

    iv. The capacity of KaBand satellite systems is much superior to existing CBand systems. The

    ultimatecapacityofsatellitesystems isdependentonthenumberofsatellites launched,and

    forNorthernCanada,theeconomicsofprovidingservicetorelativelysparselypopulatedareas.

    v. Satellitestypicallyhaveadesignlifeof15years.

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    vi. Communitiesservedbysatelliteswill likelyhavediversityofsatellitecommunication links, in

    thesensethatKaBandandCBandservicesareondifferentsatellites.

    vii. Satellites operating in the KaBand have a greater susceptibility to rain fade than those

    operating

    in

    the

    C

    Band.

    This

    phenomenon

    can

    be

    mitigated

    by

    use

    of

    adaptive

    coding

    and

    modulation(ACM)schemes,incorporatingforwarderrorcorrection.Inaddition,UplinkPower

    Control(UPC)isatechniqueusedtomitigaterainfade.UnlikeACM,UPCdoesnotreducethe

    capacityofthenetwork.

    c) MicrowaveRadio

    In terms of both capacity and cost, microwave radio systems typically between fibre and satellite

    systemsintermsofbothinitialcapitalcostandexpansionoptions.

    For low capacity applications, the cost of constructing a microwave radio route and the associated

    towers and other civil works structures are often prohibitive. However, as demand increases, the

    economics of microwave radio systems is characterized by an initial higher capital cost than satellite

    systems,butasignificantlylowercapitalcostcomparedtofibresystems.

    Akeyparameterrelativetotheperformanceamicrowavesystemistheinitialradioroutedesign. This

    designdeterminestheheightoftowerstoachievereliablecommunicationsinallweatherconditionsand

    alsoaffectsthelongtermoperatingcostsintermsofpoweringoptionsforremotesites.

    i. Forcarriergrademicrowaveradiosystems,thedistancebetweenradiotowerscanbeupto

    80km,althoughthisisdependentontheterrain.

    ii. Microwavesystemsaretypicallydesigntoanavaibilityof99.99%,butoftenperformatthe

    higherlevelof99.999%undermostweatherconditions.

    iii. Modernradiosystemsconsumesignificantlylesspowerearlierversions,andcanbesupplied

    byhybrid integratedsolar,wind,dieselpowerunits.Thisreducesthenumberoftimesthat

    fuelneedstobeprovidedatindividualsites.

    iv. Ingeneral,microwaveradiosystemsaremoreexpensivetomaintain. Fuelisrequiredtobe

    deliveredtoremotesites.Thisusuallyinvolveshelicopterlifts.

    v. Microwave

    systems

    typically

    have

    a

    design

    life

    of

    20

    years,

    although

    replacement

    of

    the

    batterypackisrecommendedatleastevery10years.

    vi. Microwaveradiosystemtowersaresubjecttoiceandsnowloading.

    Inthereport, iceandsnow loadinghasbeenconsidered inthedesigncharacteristicsof

    themicrowaveradiotowers.

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    d) GenericCostvs.CapacityComparisons

    Acriticalparameter inthechoiceofwhich technology ismostappropriate foraspecificapplication is

    current,

    and

    forecast

    demand.

    The

    figure

    below

    provide

    an

    illustrative

    comparison

    of

    alternative

    technicaloptions

    Figure13 IllustrativeComparisonofTelecommunicationsBackboneNetworkAlternatives(notto

    scale)

    Forlowdemandoveralargegeographicarea,traditionalsatellitesystemsalwaysofferthemostcost

    effectivesolution.However,asdemandincreasesbothradioandfibrebecomemorecosteffective.In

    ourmodel,

    Ka

    band

    satellite

    capacity

    would

    be

    dedicated

    to

    the

    region

    at

    asubstantial

    capital

    cost

    and

    thereforediffersfromthetraditionalCbandsatellitemodel,beingmostcosteffectiveinthemoderate

    capacityrangebetweenmicrowaveandfibre.

    Forlongtermhighercapacitylinks,mostoperatorsworldwideareadoptingfibreopticsasthebackbone

    communicationtechnologyofchoice.

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    Page42of44

    SystemConfiguration CapitalCost

    ($M)

    OngoingAverage

    Annual

    OperatingCost($M)

    TotalCost

    in$2013($M)

    AllFibreOption

    toall14communities

    plusDeceptionBay

    $154M 2.3+3.9average

    transportand

    interconnection

    costs

    $280M

    (20years)

    ArcticFibre

    (assumingall14

    communitiesareserved

    plusDeceptionBay)

    $143M ArcticFibreusesa

    "Utility"business

    model,andongoing

    costsaredependent

    onthe

    number

    of

    usersonthesystem

    ArcticFibreusesa

    "Utility"business

    model,andongoing

    costsaredependent

    onthe

    number

    of

    usersonthesystem

    Fibreplusradiolink

    KuujjuaqtoSchefferville

    $135M 2.4+3.9average

    transportand

    interconnection

    costs

    $260M

    (20years)

    Fibreplusradioto6

    communitiesplus

    Kuujjuaq

    $129M 3.1+3.9average

    transportand

    interconnection

    costs

    $270M

    (20years)

    Fibreplussatelliteto5

    communitiesplus

    Kuujjuaq

    $127M 1.9+3.9average

    transportand

    interconnection

    costs

    $243M

    (15yearsforsatellite

    and20yearsfor

    fibre)

    Satellite(CombinationofCband

    andKaBand)servingall

    14communities

    $94M 1.6+0.4 total

    internetgateway

    cost

    $125M

    (15years)

    Table7 NetworkAlternativesthatmeetKRG2021CapacityRequirements

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    Table 8 shows a comparison of network options considered in the study that meet the KRG 2016

    networkcapacityrequirements.

    System

    Configuration

    Capital

    Cost

    ($M)

    OngoingAnnual

    OperatingCost($M)

    TotalCost

    in$2013($M)

    ForComparisonAllFibreOption

    toall14communities

    plusDeceptionBay

    154 2.3+1.1

    average

    interconnect

    220(20years)

    AllMicrowaveRadio

    Option Toall14communities

    67 3.7+1.1average

    interconnect

    163(20years)

    Satellite(CombinationofCband

    andKaBand)servingall

    14communities

    31 1.4+1.1average

    interconnect

    68(15years)

    Table8 NetworkAlternativethatmeetKRG2016CapacityRequirements.

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    13.ProjectedProjectImplementationtimes.

    TheoverallgeneralisedtimescaleforapotentialexpansionoftheNunaviknetworkisshownbelow.

    14.Conclusions

    Theprincipalconclusionsoftheprefeasibilitystudyare:

    a) SatelliteandfibreopticstechnicalsolutionscanmeettheKRG2021trafficrequirements.

    b) KaBandsatellitetechnologyhassignificantcostandcapacityadvantagescomparedto

    existingKRGCBandsatellitetechnology.

    c) FibreopticssolutionsforNunavikaretechnicallyfeasible,andofferthebestoverall

    performancespecificationsandlongtermtrafficgrowthcapacity.

    d) Fromacostperspective,thelongterm20yearoutlookisdependentonforecastoftraffic

    demand.

    i. Forlargecapacitysystems,fibreopticsiscurrentlythenetworktechnologyof

    choiceformostglobalnetworkoperators.

    ii. However,modernKaBandsatellitetechnologiesoffercostadvantagesforlower

    demanduserprofilesandservicetosomeisolatedcommunities.

    Securing

    funds

    1year

    minimum

    EA

    02years

    minimum

    Construction

    2years

    minimum

    Total

    35years

    minimum