Phillips, partner to build West Coast LNG plant

ANCHORAGE -- Phillips Petroleum Co. says it has teamed with a major natural gas firm to build the first liquefied natural gas terminal on the West Coast, to be used for gas imported from Australia.The terminal, which would be half-owned by El Paso Corp., could help an LNG project in Alaska, according to Phillips."Development of this terminal on the West Coast of North America could facilitate an Alaska LNG project,’’ said Kristi DesJarlais, a spokeswoman at Phillips headquarters in Bartlesville, Okla.But she said the company still considers a pipeline from the North Slope through Canada as the "best opportunity to maximize the value of Alaska gas."The company hasn’t decided on a pipeline route, she said, but "Phillips is committed to developing an economic Alaska gas project.’’If Phillips and the other gas owners choose to develop a pipeline to Fairbanks and then along the Alaska Highway, a spur line could be built to Valdez or another port in Alaska. The other alternative being considered, across the Beaufort Sea and then south in the Mackenzie River valley of Canada, wouldn’t offer that possibility.The LNG terminal "tells us about the Lower 48 market,’’ said Dawn Patience, a Phillips spokeswoman in Alaska. "It’s pretty consistent with Phillips’ belief that the Lower 48 marketplace presents the best opportunity to sell Alaska North Slope gas.The deal between Phillips and El Paso calls for the two companies to jointly build a receiving terminal to serve the California and Baja California markets, and for Phillips to deliver 4.8 million tons of liquefied natural gas annually. That would provide about 680 million cubic feet of gas a day, starting in 2005. El Paso would market the gas.No terminal site has been announced, but it could be in Mexico."The companies are working with Mexican and U.S. authorities to establish a site of the new terminal and acquire regulatory permits,’’ Phillips said in a statement. There are currently no LNG terminals on the West Coast, at least in the Lower 48, DesJarlais said.The companies would also jointly own the tanker fleet that would bring the gas from Australia, she said.The gas plant near Darwin, Australia, would be owned by Phillips and two partners, Royal Dutch Shell and Woodside Petroleum Ltd., of Australia, which operates the Greater Sunrise fields in the Timor Sea. It would use the same technology as Phillips’ pioneer plant in Nikiski, which has been operating for more than 30 years to liquefy Cook Inlet gas.Phillips has a 30 percent share of the Timor Sea field, which has estimated gas reserves of 9 trillion cubic feet. The field is expected to begin producing as early as mid-2006.To start deliveries in 2005, Phillips would ship gas initially from its Bayu-Undan project, also in the Timor Sea. That field is scheduled to start production early in 2004.

Safety agency looks to Alaskans to solve state's crash mystery

Controlled flight into terrain accidents among commuter and air taxi operators in Alaska have officials with National Institute for Occupational Safety and Health baffled enough to ask carriers for additional information in a statewide survey."In our research of the NTSB (National Transportation Safety Board) data we fail to find a pattern in what is one of the worst problems in Alaska aviation," Dr. George Conway, a NIOSH official in Alaska, told members of the Alaska Air Carriers Association at its 35th annual convention, March 1-4 in Anchorage. "We, the FAA (Federal Aviation Administration), NTSB and the National Weather Service will be surveying you to get additional input on this problem."The AACA convention, called "2001: Raising the Bar," offered numerous breakout sessions on aviation safety, but this presentation by Conway was chilling in its content.Conway and other NIOSH associates have combed through controlled flight into terrain aviation accidents statewide from 1991 through 1998, trying to find patterns and demographic information about the crashes.Between 1990 and 1998 there were 229 fatal commuter and air taxi accidents in the United States, of which Alaska accounted for 49, or 21 percent, according to NIOSH research.Of 351 accidents since 1991 by single aircraft commuter and air taxi operators in Alaska, 59 percent were controlled flight into terrain.Of 140 fatalities over this time period, 82 deaths or 59 percent occurred in 30 controlled flight into terrain accidents.These crashes were 47 times more likely to be a controlled flight into terrain than not if the pilots were flying from visual flight rules into instrument meteorological conditions.Additionally, no risk for controlled flight into terrain was shown for flight hours, number of engines, passenger presence or pilot age. All such accidents were attributed to pilot error, often for continuing VFR flights into poor visibility, concluded the NIOSH official."There does not seem to be a pattern either in age, type of equipment or time of year, but there is a correlation to the days of the week. Most controlled flight into terrain crashes occurred on Fridays, Sundays and Saturdays in the order of frequency," Conway added. And controlled flight into terrain accidents seem to happen in three year cycles in terms of frequency increases."NIOSH and the other federal agencies are pinned with finding the answer to the Alaska mystery and said that this type of crash nationwide is costing $53 million yearly.Of the Alaska controlled flight into terrain accidents, all are from Part 135 operators, or sole pilots, and according to industry and NIOSH, it has been 20 years since a Part 121 operator has had a crash in Alaska, which points to operational control, according to NIOSH."We need to solve this problem. We are going to do everything we can to cooperate," said John Eckels, president of AACA.

Movers & Shakers March 18, 2001

Eklutna Inc. has hired William C. Price, a Seattle-based consultant, as interim chief executive. Price previously worked on several complex projects for the Alaska Native village corporation. Price is a development management consultant with both a public and private background. Jeffrey Potts has joined the Wasilla office of USKH Inc. as a staff civil engineer in the transportation engineering department. Potts, an engineer in training, received a bachelor’s degree in civil engineering from Portland State University in Oregon. Lucas Schneller has joined the Wasilla office as an electrical designer in the mechanical/electrical engineering department. Schneller received a bachelor’s degree in architectural engineering with specialties in electrical and structural design from the Milwaukee School of Engineering. Brady & Co. has promoted Chris Haglund and Colleen Savoie to senior account managers/assistant vice presidents. Haglund and Savoie have been employed by the firm since 1997 and are responsible for servicing jointly managed trust funds, defined benefit and defined contribution pension plan clients. Randy O’Neil has joined Brady & Co. as senior loss control consultant. O’Neil has been employed by Fremont Compensation Insurance for the past 22 years. O’Neil provides risk management and safety consulting services to clients in Alaska. The Anchorage Chamber of Commerce City of Lights Committee has selected the following winners for the 2000/2001 City of Lights Competition: in Anchorage, Erich and Beverly Rusche, 8621-8623 Shrub Court; in Eagle River and Fort Richardson, the Paulino family, 426 Beluga Ave.; and in Girdwood, John Bridges and Christy Dodds, Mile 1.9 Alyeska Highway. Rich Monroe has joined First National Bank as vice president in the bank’s commercial lending division. Monroe has more than 25 years of banking industry experience, most recently as a senior officer and director at another Alaska bank. Monroe began his banking career in 1976 in Seattle, working in retail banking, corporate lending, special credits, investment banking and credit administration. Shawn McNamara has joined Bezek-Durst-Seiser as a computer-aided drafting technician in its production graphics department. McNamara has been working with CAD programs since 1996 and has worked in the design and construction industry for the past 10 years. Charles and Marie Brobst of North Pacific Auctioneers Ltd. in Anchorage have successfully completed the Certified Appraisers Guild of America’s course in personal property appraisal held in Las Vegas. Training subjects included the appraisal of antiques, farms, livestock and business properties as well as requirements for valuing estates, bankruptcy, insurance, divorce and providing expert testimony in court. Michael D. White has joined the firm of Patton Boggs as of counsel in the Anchorage office. White concentrates his practice in civil litigation, employment law and commercial disputes. White previously spent 13 years with the Anchorage law firm of Hartig Rhodes and is president of the Anchorage Bar Association. Emma Wilson has joined the Fairbanks Convention & Visitors Bureau as conventions manager. Wilson previously served as a manager for British Airways in Bahrain. Wilson has been in the visitor industry for the past 10 years. Jane Godfrey, visitor information manager, has moved into a new role as human resources and operations manager. Katie Orth, visitor information coordinator for the past two years, has assumed the responsibilities of visitor information manager. Gerald Douthit has joined Terra Surveys LLC in Palmer as a partner. Douthit has 25 years of marine geophysical mapping experience. Most recently, Douthit owned and operated NW-GEO Sciences. Douthit will market marine geophysical projects, manage Pacific Northwest work and establish a project office in Rhode Island. The Soldotna Chamber of Commerce has chosen the following people as its 2000 Annual Award winners: Norm Blakeley, Person of the Year; Jim Fisher, Volunteer of the Year; Fred Hammond, Businessperson of the Year; Pat Cowan, Pioneer Award; Jane Fellman, Devoted Service to Young People; John Lohrke, Excellence in Profession; and Kenai Peninsula Borough Mayor Dale Bagley, Government and Civic Affairs. Jason McDaniel has been appointed customer services manager of HCI Steel Building Systems of Arlington, Wash. HCI originated in Alaska. McDaniel’s duties also will include scheduling of manufacturing. Native Voice Communications has appointed Veronica Iya of Anchorage as underwriting director. Iya will be responsible for securing sponsorship and underwriting for the company’s programs including "Independent Native News." Iya, an artist and businesswoman, directs an art marketing business. Gov. Tony Knowles has appointed Rebecca Nance Gamez deputy commissioner for the Department of Labor and Workforce Development. Gamez was appointed director of the Employment Security Division in January 1995. Prior to her appointment, Gamez worked for the International Brotherhood of Electrical Workers and for the Alaska and Oregon state legislatures. Stan Stephens has been elected president of the Prince William Sound Regional Citizens’ Advisory Council. Stephens operates Prince William Sound Cruises and Tours in Valdez. John Allen, representing Tatitlek, was elected vice president; Marilynn Heddell, representing Whittier, secretary; and former president, Bill Walker of Valdez was elected treasurer. At-large members include: Steve Lewis, Seldovia; Dennis Lodge, Seward; and Paul McCollum, Homer. Two new members seated on the council are Cheryll Heinze representing the Alaska State Chamber of Commerce and Jane Maria Eisemann, Kodiak. The Architecture/Engineering Marketing Association of Alaska has elected the following officers for the year 2001: Maureen Benner of Estimations Inc., president; Andrea Soland of ASCG Inc., president-elect/vice president programs; Shannon Vivian of Enterprise Engineering Inc., vice president of membership; Ingrid Martin of Peratrovich Nottingham & Drage Inc., treasurer; and Corissa Schock of Porath Tatom Architects, secretary. Other officers include Lori Kropidlowski of USKH Inc., vice president of publicity; Susan Stabler of ECI/Hyer Inc., vice president of elections; and Brook Mayfield of Livingston Stone Inc., member at large. Dan Lee of Re/Max Properties Inc. in Anchorage successfully completed the National Association of Realtors’ mediator/mediation training seminar conducted in Chicago in December. Lee, an associate broker with the agency, has been employed by Re/Max since March 1988. Participants in the training will serve as mediators for state and local associations.  

Marathon invests in Inlet

Convinced that Cook Inlet has at least 1,000 billion cubic feet of undiscovered natural gas reserves, Marathon Oil Co. plans to spend $20 million in Alaska this year looking for them.John Barnes, manager of Marathon’s Alaska operations, told members of the Alaska Support Industry Alliance March 9 that finding more natural gas reserves in Cook Inlet is his company’s No. 1 priority."I think gas exploration activity should be higher in Cook Inlet," Barnes said, "but I’m proud of Marathon’s efforts."Barnes said the Inlet region boasts 2,500 Bcf of proven gas reserves -- or a 12 years’ supply at the current consumption rate of about 200 Bcf per year -- and from 1,000 Bcf to 3,000 Bcf of potential gas reserves, which could last five to 15 years."We need to drill wells to narrow the range of uncertainty," he said.Toward that end, Marathon is working to begin production from the Wolf Lake field where it found gas in 1998. The company is building a 5.37-mile production pipeline this spring and on-site production facilities this summer to produce gas at Wolf Lake and ship it to Marathon’s Beaver Creek field. The Wolf Lake field is inside the Kenai National Wildlife Refuge. Alaska Native regional corporation Cook Inlet Region Inc. is the royalty owner of the field.Barnes declined to say how much gas Marathon believes Wolf Lake holds for competitive reasons. However, he said the company expects to produce gas at a rate of about 10 million cubic feet per day at start-up this fall.Marathon is also participating with Unocal Alaska Resources in proposed exploration of the Sunrise Lake prospect, which also is located within the Kenai National Wildlife Refuge.Barnes said part of Marathon’s success in developing and extracting more gas from its existing Inlet fields is due to the construction of a cost-effective mobile drilling rig, the Glacier Drilling Rig 1, which has drilled more than 50,000 feet downhole in various locations since its first well was spudded last April.He also credited Marathon’s innovative well completion process with producing better wells at lower costs.

Two processors face fines

ANCHORAGE -- The U.S. Environmental Protection Agency is proposing a total of $132,000 in fines against two seafood processing companies accused of improperly discharging fish waste from plants in Ketchikan.The EPA has proposed $77,000 in fines against Wards Cove Packing Co. and $55,000 against NorQuest Seafoods Inc. Both companies are based in Seattle.EPA officials accuse Wards Cove of failing to route all seafood waste through a waste-handling system, discharging seafood waste exceeding a half-inch in size, accumulating seafood waste not routed through the treatment system on the sea floor beneath the plant, failing to properly operate and maintain all compliance systems, and discharging foam and scum in violation of Alaska water quality standards.NorQuest was accused of failing to route all seafood waste through a waste-handling system, failing to properly operate and maintain all compliance systems, and improperly discharging foam and scum.Both companies were inspected in July, EPA officials said."Seafood processing is a critical element of Alaska’s economy, but it shouldn’t be done at the expense of the environment that the seafood industry ultimately depends upon,’’ Bub Loiselle, anager of EPA’s water quality compliance unit, said in a written statement.Gordon Williams, president of Wards Cove, said his company has not violated pollution rules and would fight the proposed penalties."We’re disposing of our waste in a manner that we feel is proper,’’ Williams said. "We surely haven’t changed anything as far as the way we’ve handled waste in the past."

'Green' grows worldwide

JUNEAU -- Ecotourism is taking a larger share of the visitor industry worldwide, but it’s not clear how much Alaska is profiting from the trend.Scant statistics in Alaska on ecotourism ventures, along with the lack of a formal certification program in the industry, have clouded the picture, including the potential for growth.Megan Epler Wood, president of the International Ecotourism Society, touted "the green marketplace" in a keynote address to the Alaska Wilderness Recreation & Tourism Association conference in Juneau in late February.Nature-based, sustainable tourism is now the third-fastest-growing segment of the industry, after cruise ships and gambling, said Epler Wood, who lives in Vermont. About 22 percent of Americans are "true environmentalists," and about half of those are willing to pay more for green products, she said. The Oregon Tourism Commission has reported consistent 10 percent annual growth in ecotourism there.There’s danger in that success, Epler Wood warned. As the niche begins to attract more money, new owners might move toward a more bottom-line-oriented philosophy, she said. So far, ecolodge investors are most often philosophically motivated private individuals willing to accept a lower rate of return than would venture capitalists or corporations, she said."Mislabeling is a rampant problem," as there is no seal a business can get, Epler Wood said. "We don’t have any way to prove we’re green."AWRTA, founded in 1992, has eight ecotourism guidelines. Among them: Businesses should seek to limit economic growth rates in a way that sustains the environment and minimizes visitor impacts on the land, wildlife, Native cultures and local communities. They should provide "direct benefits to the local economy and local inhabitants," according to the guidelines. "At some point, a tour group becomes too large to be considered ’ecotourism.’ "There is no policing of the guidelines, said Sarah Leonard, executive director of AWRTA. The group doesn’t deny membership to anyone who wants in, she said.There are about 300 AWRTA members, including about 250 business operators, with 65 to 70 of those in Southeast Alaska, Leonard said.

As halibut season gets under way, fishery on lookout for 'chalky' fish

Look for a noticeable upswing in activity along the docks as fishermen begin gearing up for one of the most eagerly anticipated fisheries -- halibut. The season began March 15; though mid-November, Alaska longliners will vie for a catch of nearly 62 million pounds, up roughly 10 million from last year. During the eight-month season, fishery managers will again be monitoring the occurrence of "chalky" halibut, a rather rare condition that affects the color and texture of the fish’s flesh. Instead of being shiny and translucent, the meat of chalky halibut looks like it has been cooked even though it’s still raw. While it’s safe to eat, the fish is likely to be drier and tougher after cooking. One of the biggest problems posed by chalky halibut is that there’s no sure way to predict or prevent it because visual indicators don’t show up until long after the fish is caught, processed and on its way to market. Research has shown that chalkiness is directly related to the acidity, or pH level, of the halibut flesh. The fish may appear to be normal for up to seven days while held on ice. After that, the pH level begins to drop and the flesh becomes chalky as the acidity manifests itself in the meat. Lactic acid builds up in the flesh of struggling halibut, much the same as it does in the muscle tissue of an athlete.

Alaska aviators talk about safety -- and federal agencies listen

When aviation experts sit at a table and discuss the history and ways of flying in Alaska, everyone listens. And that is just what happened at the 35th annual Alaska Air Carriers Association convention during the last full day of presentations."We have pushed our business to the ragged edge," said Danny Seybert, vice president of Peninsula Airways Inc. "The only constant in our business is that we are in a constant state of change."Seated next to each other, and moderated by Bob Hajdukovich of Frontier Flying Service Inc., a round-table discussion of industry change attended by Seybert, Wilfred "Boyuk" Ryan of Arctic Transportation Services, Tim LaPorte, owner of Iliamna Air Taxi and John Eckels, president of the AACA.When they spoke, officials with the Federal Aviation Administration, National Transportation Safety Board and National Institute for Occupational Safety Hazards listened.The theme of the roundtable was "System Safety -- Lessons Learned." The session proved to be one of the highlights of a daylong seminar called "The Alliance for Safety" hosted by the Alaska Air Carriers and the FAA."What we have needed for a long time is to change the ego of the pilots, and I think that is what we are doing here," said Ryan, a pilot from Unalakleet. "As managers of our businesses we need operational control standards that pull in the reins on the big ego pilots."Operators and federal officials are stymied by a lack of improvement in safety statistics that make being a commercial pilot for an airline in Alaska one of the most dangerous jobs in the United States.Statistics from NIOSH indicate that the occupational fatality rate for commercial pilots in Alaska is 430 of 100,000 per year, 86 times the occupation fatality rate for all workers in the United States and five times higher than the national fatality rate for all other U.S. pilots.These statistics are not lost on insurance providers that have hiked aviation insurance rates to commercial operators as much as 80 percent in the last two years.This group discussed in detail what has to be done to change the culture of the businesses from "fly or I will send someone who will" to "let’s make a calculated decision involving dispatchers and management on questionable higher risk flights.""What Alaska operators are trying to change is the attitude of pilots that lead to flights into bad weather with the ’I can get the job done’ approach," AACA’s Eckels said.Small operators like Iliamna Air’s LaPorte offered a different perspective."We are so small that as a 135 operation I am the dispatch, operations, pilot and bill payer of my business. If I don’t like the way things look, everything comes to a halt. We don’t have a lot of employees to make decisions. We are too small."Changing everything right down to the reservation agent, may be what operators are facing to change the habits of risk-taking pilots, who fly in any kind of weather, but this won’t happen unless management is involved, according to the group."Improving the culture to bring safety awareness to every member of a flight operation distills down to operational control. You have to break the chain of events that lead up to a disaster," said Bob Hajdukovich, president of Fairbanks-based Frontier Flying Service."That’s right. Management has to get in the cockpit with the pilot to change the company culture," stated John Hajdukovich, chief executive officer of Fairbanks-based Frontier Flying Service and father of Bob Hajdukovich, from the audience."In our operation we have a core value: customer satisfaction, good business ethics and safety. This is our culture, and we believe that the culture of management effects the whole operation in a positive manner," said Eckels, also president of Arctic Transportation Services."We will do it right and be safe as a business, or risk being told by the FAA how to manage our business," added Eckels. "I don’t think any business organization can withstand this mandate. We have to do ourselves."Increased guidelines for operations such as the Federal Aviation Regulations for Part 121 airlines, self-imposed by Part 135 operations, will reduce the operational risk of accidents, according to PenAir’s Seybert."It is easy to confuse your goals unless things are black and white, and that’s why we like the Part 121 operational system. Now our company goal is for safe and reliable transportation; that will save us lives and money in the long run."

Alaska awaits 'someone to blow the bugle' on missile defense

ANCHORAGE -- Despite heightened interest in the Bush administration about missile defense, no construction activity is under way yet in Alaska, the most likely spot for the first deployment of interceptor missiles.The huge and still-unproven defense project is on hold while the new administration weighs options that could include development of technologies other than the limited Alaska system favored by the Clinton administration. Theoretically at stake is the defense of Alaska, as well as a $600 million construction project for the Interior."We’re leaning forward in the foxhole waiting for someone to blow the bugle so we can charge,’’ said Chris Nelson, missile defense coordinator for Gov. Tony Knowles.The stalled project takes on new significance for Alaskans in light of North Korea’s recent threat to resume testing its intermediate-range missiles in response to the Bush administration’s "hard-line stance’’ toward the country.Defense experts say the Taepo-dong 2, the missile under development when testing was suspended nearly two years ago, would have a range of about 2,500 to 3,700 miles. The distance from Anchorage to Pyongyang, North Korea’s capital, is about 3,700 miles.More likely targets, however, would be South Korea and Japan, according to military experts. A nuclear shot at Alaska could be considered suicidal, given America’s ability to retaliate.But those who support a national missile shield, including many in the Bush administration, depict North Korean leader Kim Jong Il as unpredictable and unstable, a dictator who might choose nuclear destruction rather than lose power.Alaska might offer attractive targets, such as the trans-Alaska pipeline, Nelson said. Such a strike might create economic havoc but kill only dozens of people, possibly causing a U.S. president to think twice about a retaliation that would kill hundreds of thousands.Under that scenario, Alaska’s isolation could make it more vulnerable.A final decision on national missile defense, including possible deployment of the Alaska system, isn’t expected until summer, Nelson said. But state officials hope to hear in the next few weeks whether work can begin this year on the remote Aleutian island of Shemya, where a high-resolution radar for tracking incoming missiles could be built.Under the Clinton administration’s original $60 billion plan, a go-ahead on Shemya construction was needed by this month to meet the goal of erecting a missile system by 2005. That’s when an independent commission had predicted nuclear threats to the United States from North Korea or other countries could be in place.

Morris buys Business News Alaska

Morris Communications Corp. has purchased Business News Alaska, a 2-year-old monthly business publication based in Anchorage, from owners Raylene Combs and Kristin Southerland. The purchase price was not disclosed.Business News, which has 2,000 paid subscribers, will merge its operations with the Alaska Journal of Commerce, Morris’ weekly business newspaper in Anchorage.Some of Business News’ former staff members and contractors will join Morris’ Alaskan Publications, the Journal’s administrative parent, to work for a new publication -- the expanded Alaska Oil and Gas Reporter.Craig Johnson, general manager of Alaskan Publications, said the change will be a good one for Alaska’s business community."The Alaska oil and gas industry has not received the media coverage that such a large segment of our economy merits," Johnson said. "We’re very pleased to expand that coverage with the new Alaska Oil and Gas Reporter. The association with Raylene Combs will allow us to deliver that coverage."Johnson and Combs said both Journal and former Business News readers can look forward to better, broader news coverage."We’re delighted to become a part of the Morris family," Combs said. "I’m excited about getting back to working with the oil and gas industry."

It's time to bring a bit of civility back into business behavior

It seems that everywhere we turn we are confronted by incivility, bad manners and in-your-face aggressiveness. It’s migrated to sports (XFL); and it shows up in the way we treat each other in business. Yet there can be no forgetting that civility and good manners are still the important lubricants that make for good business relationships and social intercourse.My life today is made up of a diet of countless business meetings interspersed with life-sapping business travel. In the course of that experience, I’m noticing certain repetitive patterns of behavior that are beginning to grate on the nerves, all committed by boors and buffoons who should know better. It’s time to call these philistines to task. It’s time to reprise the rules of civilized business behavior.Using speakerphonesDon’t use a speakerphone if you’re the only person in the room. Speakerphones were meant for group interaction. At a minimum, it’s discourteous to work at your desk while I’m trying to have a conversation with you. It’s also arrogant in the extreme and an implied power play to boot.

Consulting firms forge alliance to capitalize on Russia's potential

The future beckons for two Alaska consulting firms specializing in Russia who have formed an alliance.Expected increases in oil development activity at Sakhalin Island may translate into more work for Sakhalin-Alaska Consulting Group LLC and its clients. Also, the firm’s new business partner, Alaska Russia Investment Co. Inc., could see more opportunities as a result of a proposed offshore oil and gas lease sale in Magadan.Principals from the two firms agreed to the strategic alliance in January and finalized the agreement in early March, said David Heatwole, president of Alaska Russia Investment Co.The alliance expands potential business opportunities for both firms while offering clients expertise in Sakhalin and Magadan regions, said David Parish, partner with Sakhalin-Alaska Consulting Group.The two firms are now working together on opportunities related to the Magadan lease sale."Magadan is going to come up on the radar screen," said Heatwole who has worked in the Russian Far East city since 1989 previously as a geologist for ARCO Alaska Inc. He has operated his firm since 1993.The firms’ business alliance allows clients to secure resource industry expertise on Sakhalin and Magadan, he said."In Russia local contacts are very important," he said.The lease sale is tentatively scheduled for summer although a delegation of Magadan officials suggested the lease sale could be delayed until summer 2002, Heatwole said. The delegation visited Anchorage in February for the Pacific Rim Construction Oil and Mining Expo.Officials from the Magadan Regional Administration believe exploration and development of oil and gas resources could be key for the region’s economic improvement.Two blocks are proposed for the lease sale, Magadan 1 and 2, Heatwole said. Seismic activity has identified 32 geological structures that may hold oil, he said."Russian geologists figure these structures hold 9.9 billion barrels of recoverable oil," he said.Gas potential for the Magadan offshore leases also is significant, estimated at 75 trillion cubic feet, he said.Alaskans’ oil field industry experience, especially work in Cook Inlet, may be an advantage in Magadan development, he said. Offshore development at Magadan should be similar to Inlet production although with colder temperatures and different challenges from ice, he said.One advantage in Magadan is the city has the only Russian Far East port designated as a free trade zone, Heatwole said. The Magadan special economic zone could benefit Alaska companies, he said. For example if oil field modules were built at the Magadan port, the free trade zone designation could help the module builder reduce import duties, Heatwole said. However, Heatwole believes the trade zone status has not yet been used by companies.On Sakhalin Island major players are advancing oil development projects, Parish said."Shell through Sakhalin Energy and the Sakhalin 2 project recently awarded several major engineering and design contracts for their projects," he said.These contracts cover offshore platforms, pipelines and a processing facility, he said.Parish envisions potential opportunities for Alaska companies in Sakhalin. Oil development in the Sakhalin region is similar to arctic conditions in Alaska and also, akin to the project in the state, developing industry infrastructure where there previously was none, he said.Although some Alaska companies are working in Sakhalin, Parish believes the oil development projects may offer increasing opportunities for a larger number of companies."I think so because the projects have primarily been exploration and initial production," he said. "Now the projects are advancing toward major development and major commercial production. If you look at the normal time frame (for projects like these) it takes 10 to 15 years for development. I think a lot of companies went into Sakhalin early on thinking there would be an early boom, but this is right on time."Parish has been working in Sakhalin since 1997, advising Western clients on business strategy there, lobbying Russian officials and marketing client capabilities to oil companies operating on Sakhalin.

Bulletin Board March 18, 2001

In gear Anchorage-based DAT/EM Systems International, a developer of photogrammetric hardware and software products and services, now services Zeiss Planicomp-series analytical stereoplotters. DAT/EM technicians Chad Carpenter and Chance Nygard recently completed training for the servicing of P-series instruments at Aero-Metric Inc. in Sheboygan, Wis. The Whale’s Tail Coffee & Spirits has opened in the Hotel Captain Cook in Anchorage. The Whale’s Tail combines the coffeehouse concept, serving coffee and pastries in the morning and lunch-time fare in the afternoon, with a wine and martini bar in the evening. Operating hours are 5:30 a.m. to 10 p.m. daily. Quality Electric has awarded Grinnell/Audio-Video a contract for special systems at the Dimond High School project scheduled for completion in August 2003. The contract includes systems for fire detection, security, intercom, classroom television distribution, public address and theatrical sound. Alcan General is general contractor for the high school construction project. Kudos The National Weather Service Alaska Region has presented awards to several marine operators in recognition of the operators’ help with weather observations in Alaska waters in 2000. Honorees were Crowley Marine Services Inc.’s vessels Seneca, Guardian, Cavalier, Sea Ranger and Sea Viking; Samson Tug & Barge Co.’s Samson Mariner; Newport Petroleum’s Northern Spirit; Alaska Marine Highway ferry Tustumena; Dunlap Towing’s Malolo; and Campbell Towing’s Lt. Campbell. The Ketchikan Visitors Bureau, celebrating its 25th anniversary, honored several individuals and organizations at its recent annual banquet and awards presentation. Kris Geldaker received the Rainbird Award for furthering the efforts of the bureau and the visitor industry in Ketchikan. Rebecca Mix of Cape Fox Tours and Ken Mix, owner of North Wind Consulting and Management, were honored with the Spirit of Alaska Award. The Excellence in Tourism Award was presented to Dale Pihlman and Cynthia McNulty for the successful development of the local company Alaska Cruises. The Ketchikan Fire Department received the Heart of the Community Award for its record of quick response, skill level and care of visitors in emergency situations. The Great Alaskan Lumberjack Show received the Golden Totem Award for leadership, ideas and cooperative efforts in working with Ketchikan’s visitor industry. The Anton Anderson Memorial Tunnel providing access to Whittier and Prince William Sound has won a Grand Award in the American Consulting Engineers Council’s 35th annual Engineering Excellence Awards competition. The world’s first public highway/railroad tunnel opened June 7. HDR Alaska Inc. led the design of the $80 million multi-modal facility for the Alaska Department of Transportation and Public Facilities. Locator Anchorage Neighborhood Housing Services and Anchorage Mutual Housing Association are moving their offices to 480 W. Tudor Road in Anchorage March 20. The telephone numbers for ANHS, 907-243-1558, and for AMHA, 907-248-1321, remain the same. The fax number for both offices remains 907-243-3214. Facility Management of Alaska Inc., a SMG Co., is moving the location for the Tesoro Alaska Recreational Vehicle Round-up scheduled March 22-25 to the Municipality of Anchorage-owned facility located at 5701 Northwood Drive. For more information about the annual RV dealership show, contact Tanya Hoak at 907-279-0618. Media Friends of the Library is conducting a Unique and Rare Book Auction at 7 p.m. March 30 at the Z.J. Loussac Public Library Ann Stevens Room. Both silent and live auction literary treasures will be up for bid. The live auction begins at 8:15 p.m. with former Mayor Rick Mystrom as auctioneer. Tickets costs $30 at the door. For more information, contact Kim Brady at 907-522-4028. Answers to a series of questions posed by the Anchorage Chamber of Commerce for Anchorage Assembly and Anchorage School Board candidates relating to their qualifications and positions on issues are available online. Responses can be found on the chamber Web site at (www.anchoragechamber.org) under News. For additional information, contact Angeline Fowler at 907-272-2401. Much obliged The Alaska Native Heritage Tribal Health Consortium has awarded undergraduate scholarships for the first time. Recipients are: Shylah Blair of Kotzebue; Renee Kelly, Anchorage; Jessica Scott of Juneau; Meryl Towarak, Unalakeet; and Julianne West, Kiana.  

Soldotna man typifies oil field work force, offers youths advice

KENAI -- Doug Marshall has some years to go before he qualifies for senior citizen discounts, but the 53-year-old Soldotna resident is the perfect poster boy for the state’s aging oil field work force."Oil pipeline construction in the mid-1970s and the employment boom associated with high oil prices in the early ’80s brought a large number of young workers to Alaska," according to an article on the aging of Alaska’s work force by Jeff Hadland and Greg Williams. The article appeared in the September 2000 Alaska Economic Trends, published by the state’s Department of Labor and Workforce Development."Many of these workers remained in Alaska and have aged in place, resulting in a significant increase in the average age of Alaska’s workers. Because of a number of demographic factors, it is not likely there will be enough children of those older workers to fill the anticipated employment needs of Alaska employers over the coming decade," Hadland and Williams reported.Marshall got his first taste of the oil patch in Ventura, Calif., when he was 22."My first job was with Otis Engineering as a wireline helper," Marshall said. Two years later, he had advanced to operator and was working on Unocal and Chevron platforms off the coast of Carpenteria, Calif.Coming to Alaska in 1973 to "kind of look around," Marshall did wireline work in the Swanson River area for several months, moving on to Utah and eventually back to California.In 1974, he married and set up home base in California with his wife, Carla. But home base meant little in terms of work assignments, with Marshall returning to Alaska to work for a company named Camco."They had me do some work in Cook Inlet," he said. "I came here to finish a job and then go back to California."While sitting at the Anchorage airport waiting to board his flight home, Marshall was tapped on the shoulder by Camco’s Anchorage office manager."He said, ’You know, we’re really shorthanded on the (North) Slope. Would you mind going up for a week and helping out?’ " Marshall said.Forty-five days later, the company finally flew him back to Anchorage and brought his wife from California for a three-day visit."She sat around and read and was sad all the time because I did not want to do anything but sleep," Marshall said.In 1978, he accepted an offer from Shell Oil Co. to work as a wireline operator on one of the company’s Cook Inlet platforms. His career with Shell eventually spanned more than 20 years and carried Marshall through the development of Alaska’s oil industry.Home base shifted to Alaska, with a short two-year assignment in the Bakersfield, Calif., area, where the couple lived in a 47-home company-owned community. During that time, Carla Marshall began working for Shell. Marshall made frequent trips between Shell’s offices in Houston and the company’s Alaska operations. In 1984, the couple finally returned to Alaska, with Marshall continuing to work for Shell and Carla Marshall working for Peak Oilfield Service Co. in Anchorage and on the North Slope.Marshall’s resume includes an assignment as drilling foreman for Shell’s exploratory drilling program in the St. George Basin, about 150 miles north of the Aleutian Islands and on the company’s man-made gravel islands north of Prudhoe Bay. What you won’t find mention of is the experience of riding out a five-day storm with 70-foot seas and stories of working with whaling crews out of Kaktovik."It was one of the highlights of my career to go out there and meet those people," Marshall said of assistance his crew gave to the whaling communities of northern Alaska.In 1998, when Shell sold its two Cook Inlet platforms to Cross Timbers Operating Co., the Marshalls were faced with a big decision -- to continue with Shell, transfer to the new owner or look at other opportunities."I thought my chances were a lot better to remain here at home," Marshall said. "I definitely made the right choice."Marshall said he’s not ready to retire from his position as production superintendent, Cross Timbers’ top-ranking position in Alaska.Looking back, Carla Marshall, who is currently employed by Inlet Drilling, said the couple’s employment in the oil industry has "let us live quite a comfortable life."What has been difficult for the couple is the impact of demanding work schedules."The time away from each other and then having to learn to live with each other again has been tough," she said of the travel that’s been required. After being in their home in Soldotna for almost 10 years, Carla is ready for the next adventure.If the couple decides to move on, finding someone to fill Doug Marshall’s shoes won’t be easy. Replacing personnel lost during transition of ownership has been challenging."There’s a number of people that work for us here in the Inlet that are very knowledgeable about the Inlet," Marshall said. "They’re all in the same boat I am -- long-term employees, and I think we’re all about the same age. The majority of us are over 50 years old."We’ve got two new hires and I’m getting ready to hire a third," he said. "But all of these people are well-experienced and the employees that we did keep (during the transition) are all long-term employees."They’re probably what I would call the best in Cook Inlet."For those considering careers in Alaska’s oil industry, Marshall advised, "Get an education."I know everyone doesn’t have that opportunity, but experience is the big thing even with an education, and how do you get it? That’s just it. You’ve got to break the barrier somehow, but it’s not an easy thing to do. There’s a lot of young people out there that want to get out and work, but it’s just difficult to get into the business."Marshall said that although Alaska is a big state, the industry’s small size works in favor of those wanting to break into it."In Alaska, it’s who you know," he said.

Knowles seeks school, road work funds

The outlines of a major construction program are taking shape in the Legislature. Gov. Tony Knowles has introduced bills to build and rehabilitate rural schools using new state bonds that would be repaid from future proceeds of a national tobacco tax litigation settlement that is shared with several states. A similar school construction program was funded by tobacco-funded bonds last year.The governor’s proposal, in House Bill 118 and Senate Bill 146, would see $127 million in new school construction, with $69.2 million committed to four new rural schools that are on the top of the state Department of Education’s school replacement priority list. These include a $29.2 million new facility at Togiak, a $9.9 million school at Golovin, an $11.7 million school at Koyuk, and an $18.4 million facility at Tuluksak. The remaining $57.8 million would be spent on major maintenance projects on schools around the state.A second new initiative by the governor is a bill that would allow the state to sell a form of revenue anticipation note, to which future federal transportation funds would be pledged, to fund major regional transportation-related projects. Senate Bill 122 would authorize the sale of Grant Anticipation Revenue Vehicle, or GARVEE, notes.A program proposed by the governor would see $425 million in major projects funded through this mechanism. Most of these would appear on the state’s long-range transportation plan anyway, but would take more time if they were funded through the state’s annual allocation of federal transportation funds, according to state highway officials.An example is a major highway overpass project like one planned next year at the junction of the Parks and Glenn highways near Palmer, which will cost $50 million, state Department of Transportation & Public Facilities Commissioner Joe Perkins said in a recent briefing to the Resource Development Council.If this were funded out of the normal annual allocation of federal highway dollars it would take about one-fifth of the money coming to the state that year, Perkins pointed out. As it is, the Glenn-Parks overpass is being funded out of a special one-time federal appropriation.But GARVEE bonds will allow several of these large projects to be done on a planned basis, Perkins said. By selling the bonds, he said the state DOT can put together larger amounts of funding more quickly, speeding the projects.Other construction-related legislation pending in the Legislature includes bills that would allow the state international airport system, which operates the Anchorage and Fairbanks airports, to sell revenue bonds to fund multiyear airport construction programs.At a recent briefing for legislators, Perkins said the bonds would be paid for by landing and other fees paid by airlines using the airports. House Bill 64 and Senate Bill 36 would accomplish this, Perkins said.

Railroad plans $90 million job

FAIRBANKS -- The Alaska Railroad Corp. is proposing to relocate a Fairbanks line between Sheep Creek Road and the median of the Parks Highway.The new alignment would move onto the Tanana River Dike and stay there past North Pole to the Moose Pass Road interchange, eliminating 48 road and trail crossings. That plan also cuts out about 18 miles of track.Thomas Engineering and Peratrovich, Nottingham & Drage Inc. drafted the conceptual designs for the project. Bob Thomas, with Thomas Engineering, said the project has a price tag of about $90 million.Thomas estimated project completion to be six to 10 years from now.

Resort grows with state, in fits, starts

Just as Alaska became a state in 1959, the Alyeska Resort at Girdwood, 40 miles south of Anchorage, was conceived as a magnet to attract skiers from other states and nations and build a winter tourism for the young state.The first rope-tow at the base of Mount Alyeska was actually built in 1950 by a group of ski enthusiasts headed by Joe Danich, a local resident.Later, Francois de Gunzberg, a Denver-based oilman with real estate interests, and a group of other investors including wealthy Texas oil families, first developed Alyeska as a day-use ski area in 1959.In 1960 the "Roundhouse," a wooden shelter, was built at the 2,300-foot level of Mount Alyeska and became the upper terminus for the first chair lift, a mile-long French-made Pomagalski chairlift.In 1962 the first day lodge was built near the base of the first chair to aid an effort to secure the 1963 Olympic ski tryout competition, which was successful.From the beginning, the resort’s development has been connected with efforts to attract major world ski competitions and to build the state’s winter recreation image, according to Chris von Imhof, Alyeska’s managing director.Because Anchorage was then a major refueling and support station for international airlines flying the polar routes between Asia and Europe, the resort early on began hosting international airline ski competitions. Von Imhof himself first skied Alyeska in 1964 when he was with Scandanavian Airlines System.He has been deeply involved in Alyeska’s development, from the time he first became its manager in 1967. That same year de Gunzberg’s group sold the resort to Alaska Airlines. Its then-chairman, Charlie Willis, had a vision that the resort could be developed and would attract winter visitors, helping fill airline seats during the winter months.But Alaska Airlines was struggling financially, and von Imhof had to find other ways to fund the resort’s development. Von Imhof recalls an early conversation with the late Elmer Rasmuson, chairman of National Bank of Alaska, in which Rasmuson advised him to find a new investor with deep pockets.Development proceeded, but it was slow. The resort owned a 160 acre homestead and in 1962 acquired 233 acres at the base of the mountain under long-term lease from the state of Alaska. The upper half of the mountain is used under a long-term permit from the U.S. Forest Service.The first hotel, with 32 rooms, was built in 1969. The following year another 43 units were built and sold as condominium units, with many of the units leased back to the hotel for rentals. The state-leased land was developed into Alyeska Subdivision, now a growing community with homes and condominiums.In the 1970s, three or four more buildings with condominiums were built, sold mainly to people from Anchorage. The idea was not only to sell properties to fund development of the resort, but also to build a customer base, von Imhof explained.Through the 1970s three additional chairlifts were built on the mountain, and other improvements, including night lighting at the origibnal Chair 1. In 1979 Alaska Airlines told von Imhof to find a buyer for the resort. The airline maintained an office in Tokyo then, and von Imhof recalled that its manager thought that Seibu, the major operator of ski resorts and the Prince Hotels in Japan, might be interested in an overseas investment.Four senior Seibu officials visited, and a few months later an offer was forthcoming, von Imhof recalled. The sale was concluded on October 1, 1980.Alyeska has hosted a series of high-profile international competitions, including the 1963 Olympic Trials, 1973 World Cup Alpine Competition, 1987 World Masters Competition, 1993 World Junior Olympic Competition, 2000 Western Region Collegiate Spring Series, 2000 Red Bull Freeski World Championships and, in 2001, the Alpine ski competitions in the Special Olympics World Winter Games held in Anchorage.Anchorage was the U.S. choice to host the 1992 and 1994 winter Olympics. Had the selection been approved by the International Olympic Committee, Alyeska would have been the site of all alpine events.

Around the World March 18, 2001

STATEMineral industry gets liftANCHORAGE -- The minerals industry in Alaska is getting a big boost from record production at Red Dog and Greens Creek mines.According to state figures, the two mines pushed the value of the minerals industry to more than $1.2 billion last year. That’s an increase of 11.6 percent over 1999 figures.The 2000 numbers represent the fifth straight year that the industry’s total value has topped a billion dollars. Strong mines production, as well as a surge in investments in development, helped offset exploration declines.Readers Digest deal setANCHORAGE -- Alaska is among 32 states that have reached an agreement with Readers Digest Association over its sweepstakes mailings, Attorney General Bruce Botelho said.The settlement requires Readers Digest to discontinue misleading information and to include facts about the "real" chance of winning. Included in the settlement was an $8 million fund for attorneys’ fees and restitution.Alaska consumers could be eligible for more than $16,000 in restitution, and the state will receive $75,000 for consumer protection and antitrust investigations, enforcement and education.BP fights Prudhoe spillANCHORAGE-- BP Exploration (Alaska) Inc. is dealing with a spill of drilling mud, sea water and rock cuttings at the Prudhoe Bay oil field.BP officials believe 3,200 to 5,880 gallons of the mixture spewed from a small crack in a pipeline March 6. Most of the material left a gravel pad and spilled onto the snow and tundra, BP spokesman Ronnie Chappell said.Drilling muds are used to lubricate drill bits. After use, the muds and rock cuttings from the well bore are ground at a Prudhoe Bay facility and then sent through high-pressure pipelines to be injected underground.NATIONStarbucks hits EuropeFRANKFURT, Germany -- Europe is the last frontier for one of America’s greatest commercial icons.After building a caffeine empire that stretches from Seattle to Shanghai to Dubai, Starbucks waded into continental Europe on March 8, opening doors at a shop in Zurich, Switzerland, the first of 650 stores Starbucks says it will open in six neighboring countries by 2003.Europe is new territory for the Longview, Wash.-based retailer. Over the next year, chairman Howard Schultz said he hopes to have 10 more stores in Switzerland.Most of the new stores will be 50-50 joint ventures with local companies. One hurdle remains the price. European coffee drinkers are used to paying as little as 30 cents for an eye-opening shot of espresso.Get out of the officeTRUMBULL, Conn. -- All work and no play are making Americans sick, according to a survey by Oxford Health Plans.A study of 632 men and women found that nearly one in five U.S. workers can’t use up annual vacation time because their jobs are so demanding. A third never leave the building where their offices are located once they arrive at work, the same number that work and eat their lunch simultaneously."Taking a vacation is not frivolous,’’ said Dr. Alan Muney, chief medical officer and executive vice president at Oxford. "It is essential to staying healthy.’’The average U.S. workers gets the least vacation time among industrialized nations. Where Italians are given 42 vacation days, Americans receive 13.American to buy TWAWILMINGTON, Del. -- American Airlines won a bidding war March 12 for the assets of bankrupt TWA in a $742 million deal that will mean the end of one of the most celebrated names in aviation.U.S. Bankruptcy Judge Peter Walsh approved the purchase by American parent AMR Corp., much to the relief of TWA employees who feared the airline might be reacquired by its former chairman, billionaire financier Carl Icahn.American has said it expects to offer jobs to most of TWA’s 20,000 workers, and the airline’s unions are expected to approve the deal. The purchase is subject to approval by the Justice Department.Sales fall 0.2 percentWASHINGTON -- Consumers were more selective in February, driving down sales at the nation’s retailers by 0.2 percent after a January shopping spree. They cut spending for furniture and ate out less often, though they did buy more groceries.The latest snapshot of consumer spending, which accounts for two-thirds of all economic activity, suggested that the economy continues to be sluggish but hasn’t fallen into recession, analysts said.The March 13 report "does not carry the implication of a collapsing consumer,’’ said First Union’s chief economist David Orr.But, analysts said, the report does provide a fresh reason for the Federal Reserve to rev up economic growth by reducing interest rates again.Compiled from business wire reports.

Bill would ban drilling in ANWR

WASHINGTON -- Two days after Republicans unveiled an energy bill that would allow oil drilling in an arctic wildlife refuge, legislation was introduced Feb. 28 in both the House and Senate to permanently protect the area from oil rigs.A bill by Sen. Joe Lieberman, D-Conn., would designate the 1.5-million-acre coastal plain of the Arctic National Wildlife Refuge a wilderness area, barring future development.A similar bill was introduced in the House by Reps. Ed Markey, D-Mass., and Nancy Johnson, R-Conn.President Bush has made drilling in the arctic refuge a centerpiece of his energy plan, arguing that oil and gas can be taken from the area without environmental harm.Environmentalists have promised to fight any drilling proposal, and most congressional Democrats, as well as a handful of Republicans, are opposed to opening the refuge to development.The refuge was set aside for protection in 1960. In 1980, Congress barred development of its coastal plain -- beneath which is believed to be between 5.6 billion and 16 billion barrels of oil -- without congressional approval. The area is the calving grounds for thousands of caribou and attracts millions of migratory birds and other wildlife each spring and summer.A broad energy bill introduced by Sen. Frank Murkowski, R-Alaska, on Feb. 26, would open the refuge to oil and gas drilling. Bush’s proposed budget anticipates $1.2 billion in revenue from oil leases in the refuge by 2004.Under the wilderness designations outlined in the bills introduced Feb. 28, the coastal plain of the refuge would be permanently protected from development.

Day's Inn owners plan Country Kitchen nearby

Owners of the Anchorage Day’s Inn have acquired franchise rights to Country Kitchen restaurant and plan to open a new eatery in June.Break of Day Inc. currently is remodeling the site at 346 E. Fifth Ave. for the 24-hour restaurant, which will seat 200.The downtown restaurant will employ 65 people, said franchise operator Dennis Lavey. Sixty-five percent of the employees will work full time with 35 percent working part time, he said.Renovations started Feb. 5 on the 5,200-square-foot building which Break of Day has owned for several years, he said. "We looked at all the options and decided a restaurant would be best," Lavey said.Based in Madison, Wis., the Country Kitchen chain tallies more than 250 family restaurants and plans to add 30 new stores in 2001. The corporation lends its brand to franchises either inside hotels or along busy travel routes; free-standing restaurants must seat at least 150 people and can choose to operate round the clock.Lavey believes the chain is a good fit for the neighborhood which includes the Day’s Inn and the Sheraton Anchorage Hotel."As I travel across the U.S. I always seek out Country Kitchen," he said.Country Kitchen, which serves breakfast, lunch and dinner, carries an early American farm house motif, he said.Break of Day operates the restaurant inside Day’s Inn, but Lavey plans to remodel the eatery due to the addition of Country Kitchen.

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