Alaska Native regional corporations 2013 results roundup
Glennallen-based Ahtna Inc. continued its work both in Alaska and Outside during 2013.
In its region, the company signed exploration agreements with two independent oil and gas companies to explore a natural gas prospect about 20 miles west of Glennallen on state-owned lands. Ahtna also reprocessed prior seismic work done on state land and its own land, which demonstrated the presence of gas, but more work will be needed to confirm that it is a feasible development.
The company’s oil and gas support work and contracting has also continued.
Subsidiary Ahtna Construction and Primary Products completed a $3.5 million project for Alyeska Pipeline Service Co. on the Mainline Integrity Investigations Project in October 2013, and is working on a $2.5 million spill response project at the Glennallen Response Base.
Ahtna Environmental, another subsidiary, completed a $1.3 million fuel tank system upgrade in Anchorage for the Federal Aviation Administration, also in October 2013.
Outside, subsidiary Ahtna Engineering Services is working on a $53 million construction joint venture to revamp for the U.S. Army Corps of Engineers Baltimore District, scheduled for completion this year.
Ahtna has also asked shareholders to vote this year on a trust fund that would be started using an existing capital fund, with future contributions at the discretion of the company’s board of directors.
The Aleut Corp. is one of the smaller Alaska Native regional corporations with its lands, and communities, in the Aleutians Islands area of far southwest Alaska. The corporation owns 70,789 acres of surface lands in the region as well as 1.57 million acres of subsurface mineral rights.
Although Aleut Corp. is smaller than most other Native regional corporations it has been one of the most entrepreneurial and aggressive in carving out new business niches, mostly outside the Aleuts’ home region.
For example, the Aleuts were among the first of the Alaska Native corporations to go after federal government support contracts, now a lucrative line of business for most Alaska Native corporations. Also, the corporation moved early into specialty financial services, forming the first Alaska company to offer financial trust services for Alaska and out-of-state clients, taking advantage of special provisions in Alaska laws governing trusts.
Within the Aleutians region, the Aleuts have taken ownership of a large block of acreage and former Navy facilities on Adak, a remote island, and now offer fuel services and other support to vessels operating in the area. In 2015, for the first time, the Aleuts will engage in fisheries in the region, using Adak as a base.
The Adak Naval air station closed in 1997 and the Aleut Corp. took possession of 47,150 acres on the northern side of the island in 2004 (remaining parts of Adak are within a wildlife refuge). Aleut Enterprise operates fuel services at Adak with 20 million gallons of fuel storage capacity. The remaining property, including housing, warehouses, are operated by Aleut Real Estate.
The corporation also owns and manages several office buildings in Anchorage, a warehouse and retail complex and a mobile home park in Valdez.
For the first time in 2015, the Aleut. Corp may be able to fish pollock quota it received through a provision in the federal 2004 Consolidated Appropriations Act. That quota has been unusable because fishing was severely limited in the western Aleutian Islands to protect food sources for endangered Steller sea lions. However, the National Marine Fisheries Service determined earlier this spring that less severe restrictions would still protect the sea lions.
Another Aleut Corp. subsidiary, Aleut Fisheries, also owns the fish processing building in Adak and in 2013 signed a 20-year lease with the newly-formed Adak Cod Cooperative to use the building along with 38 housing units, dock frontage and fueling services. The cod cooperative also purchased processing equipment from the city of Adak.
— Tim Bradner
Arctic Slope Regional Corp.
Arctic Slope Regional Corp., based in Barrow, is the most financially successful of the Alaska Native corporations, based mainly on earnings through industrial support work by its oil and gas subsidiary, Arctic Slope Energy, and in recent years by a share of oil royalties from the Alpine oil field on the North Slope, where ASRC shares ownership of mineral rights with the State of Alaska. The corporation owns about 5 million acres of land on the North Slope, mostly in the southern “foothills” area of the slope.
Like other Alaska Native corporations ASRC is active in government contracting and was ranked the 113th top provider of contract services to the federal government in 2013, according to a Bloomberg Government survey. ASRC earned $530.2 million in revenues from government contracts in 2013, Bloomberg said.
The corporation was also ranked No. 15 among top contractors to the National Aeronautic and Space Administration, with $200.4 million in revenues from NASA.
ASRC does not release its financial results to the public but has stated that 2012 revenues were $2.6 billion. A study by the U.S. General Accounting Office, an arm of Congress, found that in 2010 ASRC earned $2.33 billion in revenues and $164.4 million in net income, and paid $73.66 million that year in dividends to its 11,090 shareholders. ASRC says it distributes 40 percent of its earnings in dividends and since its formation has distributed $543 million.
ASRC’s oil and gas revenues will grow further after the CD-5 oil project begins production in late 2015. CD-5, now under construction by ConocoPhillips, will produce about 16,000 barrels per day at peak. ASRC is the sole royalty owner. The corporation pays 70 percent of net revenues to other Native regional and village corporations under terms of the 1971 Alaska Native Claims Settlement Act.
ASRC is more broadly engaged in oil and gas with a direct working interest ownership in the small Badami oil field east of Prudhoe Bay, which is producing. The corporation was also part of an exploration consortium led by Doyon Ltd., the Interior regional corporation, formed to explore for oil and gas in the Nenana Basin west of Fairbanks.
Arctic Slope Energy has long been known for its oil field construction and technical support work on the North Slope. The corporation owns an oilfield fabrication plant in Anchorage where process modules are built for a variety of companies.
— Tim Bradner
Bering Straits Native Corp.
Bering Straits Native Corp. took in revenue of more than $242 million during its 2013 fiscal year, according to the company’s Spring 2014 newsletter.
In the newsletter, Bering Straits stated, “We have come a long way from where we started, and even further from where we hit rock bottom in March of 1986, when we filed for Chapter 11 bankruptcy protection.”
In February, Bering Straits issued a $500 dividend to all original company shareholders age 65 and older. The special dividend matched one paid to elders in April 2013 and followed a record general dividend of $3.00 per share issued last December that pushed the 2013 dividend total to nearly $1.9 million, company Chair Henry Ivanoff said in a release.
Also in February, Bering Straits announced the formation of an Arctic Development Committee to focus on economic opportunities in the region as well as environmental, food and energy security, the company stated.
The state and federal governments, along with private interests have been investigating how to manage anticipated growth in the Arctic as receding summer sea ice allows for more shipping and oil and gas exploration in the region.
“It is imperative that BSNC have a strong voice in providing guidance on Arctic development, including responsible development of the Outer Continental Shelf (oil and gas), and other matters related to the increase in maritime activities through the Bering Strait,” company president and CEO Gail Shubert said in a formal statement.
Bering Straits acquired Arcticom, an Anchorage-based telecom maintenance company last October as a way to diversify the corporation’s revenue sources, Schubert said in the recent newsletter.
Bering Straits management is continuing to evaluate whether the Rock Creek gold mine on the Seward Peninsula can be reopened on a smaller scale, according to Schubert.
Early-phase reclamation of the mine was completed in 2012, according to the Alaska Department of Natural Resources. Bering Straits gained subsurface rights to the mine when it purchased Alaska Gold Co. in October 2012.
— Elwood Brehmer
Bristol Bay Native Corp.
Bristol Bay Native Corp. is the Alaska Native regional corporation for the Bristol Bay region, a 40-million-acre area the size of Ohio with 8,000 people and an estimated 10,000 brown bears. BBNC has its corporate offices in Anchorage and is widely diversified in business with over $2 billion in annual revenues. The corporation has paid over $120 million in dividends over the years to its shareholders, now numbering 9,600.
BBNC has become known in recent years for widely publicizing the natural beauty and productive fisheries of its region through television and print advertising. This is part of an effort, its management says, to establish a distinct corporate identity.
However, the artful advertising also indirectly underscores BBNC’s concerns about Pebble, a large gold/copper mine planned on state-owned lands in the eastern part of the region.
BBNC is meanwhile engaged in its own mining venture, although much smaller than Pebble, on its own lands in the western part of its region. The corporation is engaged with Millrock Resources, a small Alaska exploration company, and First Quantum Minerals, a major mining company, in a two-year gold exploration program near Chignik Bay.
In its business enterprises, BBNC has been active in North Slope oil and gas support work through its subsidiary, CCI Industry Services, which does specialized oil field maintenance and testing, and a newly-purchased company, Peak Oilfield Services, which has operated for years on the Slope.
BBNC is also known for its work in environmental services and remediation and has a group of subsidiaries clustered under the brand name of Bristol Alliance, working in these fields.
A key subsidiary is Petro Card Inc., a fleet fuel services company based in Kent, Wash., that operates in that state and Oregon. Petro Card sells about 330 million gallons of fuel yearly to customers, mainly operators of vehicle fleets. PetroCard itself has acquired nine small companies in the region operating in affiliated lines of business including retail fuel services. BBNC has owned Petro Card since 1985.
Like other Native corporations BBNC is heavily engaged in government contracting. In 2013 the corporation was ranked No. 163 in Bloomberg Government’s survey of top federal contractors, with $332 million in revenues.
— Tim Bradner
Alaska’s Calista Corp. announced positive financial results in 2013 on May 5.
Overall revenue for the Yukon-Kuskokwim Delta region Native corporation was down 8 percent off of a record $403 million in 2012 to $369 million, but pre-tax profit was up slightly year-over-year, according to a company release. Pre-tax net income grew to $35.4 million — 9.6 percent of 2013 revenue — compared to $34.8 million, which was 8.7 percent of revenue in 2012.
“Calista recognizes that a talented and dedicated workforce allows management to operate with greater efficiency,” Calista board chair Willie Kasayulie said in a formal statement. “The board further understands the next few years may be very challenging at the local, state and federal levels. We must be mindful of opportunities that balance growth and stability.”
Calista attributes what it said was an anticipated decline in revenue to the sequestration federal budget cuts. As is the case with several other Alaska Native corporations, a significant portion Calista’s business is tied to federal contracting.
Work on what could be one of the largest gold mines in the world continues on Calista land near the upper Kuskokwim River. The Donlin Gold project is in its early permitting stage, according to NovaGold Resources Inc., one of the project partners.
NovaGold’s 2013 annual report states that a preliminary draft environmental impact statement on the Donlin project should be ready late this year.
The surface gold mine would employ nearly 3,000 people during construction and up to 1,400 during its initial 27-year operation, according to Donlin Gold.
On March 21 shareholder dividends totaling $4.65 million for 2014 were announced by the board of directors, equating to $3.50 per share and up about 8 percent from 2013. Checks were expected to be mailed in mid-April according to a Calista statement.
More than half of the $24.6 million Calista has returned to its shareholders in dividends has been paid out in the last three years, the company states.
In September Calista added STG Inc., an energy infrastructure-focused construction company, to its list of subsidiaries. Anchorage-based STG is the 20th company to under the Calista umbrella.
— Elwood Brehmer
Chugach Alaska Corp.
Chugach Alaska Corp., with its nine government contracting subsidiaries, ranked 137th among company’s with the largest values of government contracts in fiscal 2013 with $402.6 million worth of work for the feds, according to an April 23 Bloomberg report.
More than $265 million of that was Department of Defense work, where Chugach ranked 111th. The U.S. Department of Labor spent $44 million with Chugach subsidiaries in 2013, putting the corporation ninth on the Labor Department’s vendor list, according to Bloomberg.
In 2012, Chugach was 151 on the federal vendor list.
Chugach companies offer construction, facilities management, IT services and workforce training to Alaskans as part of their work with the federal government, according to the Alaska Native corporation.
Chugach does not make its financial results available to the public.
— Elwood Brehmer
Cook Inlet Region Inc.
It has been a busy 12 months for CIRI. The Southcentral Alaska Native corporation reported total assets of $836 million at the end of 2013 in its April newsletter, down from $934 million in 2012.
In 2008, CIRI reported its assets to be worth $687 million.
CIRI’s net income in 2013 grew to $21.4 million, up $5 million over 2012, and its shareholders’ equity was up $2 million to nearly $629 million, according to the company.
In a letter to shareholders last month, CIRI President and CEO Sophie Minich wrote that 2013 dividend payments pushed total shareholder distributions in the company’s history to more $1 billion.
“No other Alaska Native corporation has reached that milestone,” Minich wrote.
CIRI broke ground on a new eight-story home in Midtown Anchorage earlier this spring. The first tower of the 110,000 square-foot “office campus” at the corner of Fireweed Lane and the Seward Highway is expected to be move-in ready by early 2015. CIRI has said it will occupy about 50,000 square feet of the space and lease the rest; it also plans to lease its current 30,000-square foot Midtown Anchorage space after the move.
Over the past year CIRI has also been embroiled in a battle with Cook Inlet producer Buccaneer Energy over natural gas royalties the Native Corp. says Buccaneer owes it from wells on the Kenai Peninsula.
CIRI claims two of the wells on Buccaneers Kenai Loop well pad are draining gas from beneath adjacent CIRI land and thus the Native corporation is owed a fee.
Buccaneer, CIRI and the Alaska Mental Health Trust Authority and the Department of Natural Resources, with which the oil and gas company has leases have not been able to negotiate a settlement. The Alaska Oil and Gas Conservation Commission said at an April 21 hearing it would act as an arbitrator and rule on the matter within 30 days of the hearing if an agreement could not be reached.
CIRI Alaska Tourism, the corporation’s tour guide and lodge operator, added the M/V Callisto Voyager this spring, a 150-passenger catamaran to its Kenai Fjords Tour business based in Seward.
— Elwood Brehmer
Doyon Ltd., the regional corporation for Interior Alaska, has expanded its oil and gas exploration work in addition to the government contracting and tourism work the company is engaged in.
The company converted an exploration license for the Nenana Basin to conventional state leases, funding the work so far itself, and has also engaged in seismic and geochemical sampling in the Yukon Flats where it owns subsurface rights. There the company has said it would like to find an industry partner for test drilling.
The company also wrapped up its second exploration well in October 2013, which was about 15 miles west of Nenana, and was unsuccessful in finding a commercial oil or gas prospect, although exploration work will continue.
Subsidiary Doyon Utilities also completed the Anchorage landfill gas to energy project in Anchorage in 2012, with a fifth unit added in 2013.. That subsidiary is a joint-venture with Fairbanks Sewer and Water.
Doyon Government Group subsidiary Arctic Information Technology was certified by the SBA as an 8(a) program company as of December 2013.
Other Doyon Government Group entities were awarded contracts at the end of 2013 for planned work, including to renovate and upgrade the Amtrak Auto station for the National Railroad Passenger Corp., and Doyon Management, and for emergency repairs and minor construction for the U.S. Coast Guard in Oregon and Washington for the next three years.
Kodiak Island-based Koniag, Inc. is continuing its work in government contracting and other endeavors.
The company announced two major contracts for its subsidiaries in early 2014. Koniag Technology Solutions received a $116 million system support contract with the Social Security Administration for up to five years, and Koniag Information Security Services was awarded support contract with the Defense Advanced Research Projects Agency for up to five years. That subsidiary also received a $2.9 million Department of Defense contract in August 2013 for professional, administrative and management support services.
Another Koniag subsidiary, Open Systems Technologies based in Grand Rapids, Mich., has been listed as a top-growing tech company, and in 2012 and 2013 added 70 employees and a Detroit office.
In March 2013, Koniag also bought into an existing Kodiak business: Anderson Construction Co. That adds to Koniag’s list of resource-related subsidiaries. The company is also engaged in aerospace manufacturing, marine construction and oilfield services through various subsidaries, as well as the tourism industry.
Koniag, Inc. also named a new president in March 2014. Tom Panamaroff is a shareholder, and served as interim president for the past year; he has worked for Koniag since 2000.
NANA Regional Corp.
NANA Regional Corp. ranked as one of the nation’s top government contracting firms in the federal 2013 fiscal year, and tops among Alaska Native corporations, according to surveys by Bloomberg Government, a division of Bloomberg News.
One of 13 Alaska Native regional corporations formed by the Alaska Native Claims Settlement Act of 1971, NANA is headquartered in Kotzebue, in northwest Alaska, and is engaged in a broad range of businesses including mining and oil and gas support, institutional support services including catering and security, and hotels in major Alaska cities and Kotzebue.
Its government services divisions, through its subsidiary NANA Development Corp., has the corporation engaged in support activities with a global reach to U.S. government installations.
According to Bloomberg, NANA scored as No. 110 in a survey of top government contractors with $540.6 million in contract revenues. In some fields NANA scored among the top 100 including logistics services (No. 27); facilities supplies (No. 28); technology equipment (No. 31); and technology services (No. 71).
NANA also owns the Red Dog Mine in the DeLong Mountains 90 miles north of Kotzebue, one of the world’s largest lead-zinc mines. Between 1989, when the mine began operating, and 2012, Red Dog’s operations have resulted in $1.5 billion in economic benefits to Alaska.
The corporation has also long been a provider of specialized industrial service to North Slope oil operators in a partnership with Sodexo, a worldwide facilities management firm, and also operates Marriott hotels in Anchorage and Fairbanks. NANA owns 2.28 million acres of lands in Northwest Alaska of 24.3 million acres in the region.
In recent years NANA has expanded its oil and gas support[TB1] services into the U.S. Gulf of Mexico through the purchase of Louisiana-based Grand Isle Shipyard, a provider of support services to offshore platforms, and the film production business, through a partnership formed in 2010 with Evergreen films, of Anchorage. One of Evergreen’s recent films is its acclaimed 3-D animation feature “Walking With Dinosaurs” released during Christmas 2013.
— Tim Bradner
Southeast Alaska’s Sealaska Corp. continued work to restructure throughout 2013, including evaluating how subsidiaries align with Native values and adjusting accordingly.
In 2013, the corporation sold its interest in three Nypro Kanaak manufacturing plants, using the proceeds to pay down debt and saving the rest for future business purchases.
Subsidiary Sealaska Environmental Services LLC was also awarded its third five-year contract with the Navy to perform long-term monitoring and environmental remediation services at Navy facilities in Washington and Alaska for about $6 million per year.
The corporation has also been working to spur small shareholder businesses.
Subsidiary Haa Aani LLC’s Haa Aani Community Development Fund partnered with The Nature Conservancy on a sustainable business development competition, with the first winners selected in 2014. The winners were Steve Helgeson and Kevin Skeek, who created a guitar-making business called Raven Guitars, and Sue and Wes Tyler, who use local Hoonah Wood at their business, Icy Strait Lumber & Milling. Applications for year two of the competition are now being solicited, and the final winners will be announced in January 2015.
In Washington, 14 Sealaska shareholders, descendants and spouses are enrolled in an 18-week business class.
The company also put $1 million toward construction of Sealaska Heritage Institute’s Walter Soboleff Center in 2013.