Cold Bay, population 89, is essentially on economic life support right now, said Bob Juettner, administrator for the Aleutians East Borough. Borough officials, using mostly federal and state grants, hope to begin construction in spring 2006 of a $3 million, 10,000-square-foot terminal. The new terminal at the all-weather airport is scheduled to handle up to 120 passengers, and house the Federal Aviation Administration flight station and weather service offices, he said June 27.

Orin Seybert, president and founder of Peninsula Airways, said he is firmly on record that if the terminal is built PenAir wants to be the first tenant, as long as it is offered at a reasonable price.

Cold Bay is extremely important to PenAir, Seybert said. When the weather is too bad to land at Dutch Harbor, PenAir flights can lay over at Cold Bay for a few hours and wait for better conditions. Alaska Airlines partners with PenAir to handle its traffic to Cold Bay. PenAir also has other scheduled flights to remote communities in the Aleutians.

Borough officials also see the potential for an economic boost from hovercraft transportation service scheduled to begin between Cold Bay and King Cove early next year. Passengers from the hovercraft would be transported the short distance from the vessel's landing site to the terminal for flights out of Cold Bay. Hovercraft could also transport fresh fish shipments from the Peter Pan seafood plant at King Cove to Cold Bay, borough officials said.

Additional fuel sales as a result of added shipping would add to the number of jobs, officials said.

Times have been tough at Cold Bay, located in the Izembek National Wildlife Refuge at the western end of the Alaska Peninsula. It lies 634 miles southwest of Anchorage, and 180 miles northeast of Unalaska. In 1985 Cold Bay had about 250 residents, said Gary Ferguson, owner and president of Aleutian Services Inc., a freight transfer business in Cold Bay. A major factor in the demise of the population has been the relocation of government employees, including several with the FAA, out of Cold Bay over the past few years, borough officials said.

Ferguson said his company got a much needed boost in June when Peter Pan Seafoods decided to ship from Cold Bay about 120,000 pounds of fresh sockeye salmon from the June fishery at nearby King Cove.

Ferguson said he got an unexpected call from representatives of Peter Pan in mid-June, asking if he could handle the transfer of red salmon. At 5 a.m. the next morning he had his first load, arriving in tenders, to transfer to a chartered Northern Air Cargo flight to Anchorage, he said. From there, the headed-and-gutted reds, packed in 70-pound boxes, went to domestic markets.

Ferguson said Peter Pan officials told him recipients of the reds were delighted with the quality. "We've always known the product coming out of this area was a better quality than that coming out of Copper River, but they have the name and developed the market," he said. "Fish caught here have never been near fresh water. It makes for a lot brighter color."

Steve Chartier, vice president of sales and marketing for Peter Pan in Seattle, said his company saw the sale of fresh sockeye into domestic markets as a window of opportunity when other suppliers were not meeting the demand prompted by various marketing campaigns. Chartier said this was the first time Peter Pan had brought King Cove reds to Cold Bay to ship out fresh.

"If market circumstances were the same, based on the success we had this year, we probably would do it again," Chartier said. Area fishermen, got 60 cents a pound, plus a 7-cent bonus for delivering the fish in refrigerated sea water to tenders.

Most of the sockeye went on to Seattle for reprocessing, then into retail markets in the United States, probably sold as fillets. Chartier said if the company had not determined that the margins looked better doing this fresh project, it would have been frozen and sold to Japan.

The logistics of transferring thousands of pounds of fish, as well as other cargo, would be eased by the large, centrally located terminal, which would be set up to handle such shipments, according to borough officials.

Overall, area residents see the proposed terminal as an economic shot in the arm, because it would bring the return of larger aircraft, offer the ability to bring in small cruise ships, and could handle passenger exchanges at Cold Bay, Juettner said.

"We have a great airport, but no facilities (at present)," he said. The airport itself is one of the greatest aviation aspects left over from World War II, he said. During the war, Cold Bay was the site of the strategic air base Fort Randall, and at the time, Cold Bay had the largest airport in the state.

Today, the Cold Bay airport boasts a 10,415-foot runway, plus a crosswind runway that is 5,126 feet long. Additionally, it has a FAA flight station and weather service facilities that are critically important in that region of the Aleutian Islands.

While Cold Bay itself is not a fishing community, borough officials said every year $100 million in seafood product is landed in the borough. Cold Bay also acts as an alternative landing site for Ted Stevens International Airport at Anchorage. Within the last three years, passenger airlines have made two emergency landings at Cold Bay, which lies on or near several Great Circle routes between North America and the Pacific Rim.

Juettner said borough officials would like to start bringing larger aircraft, carrying 60 passengers or more, back into the Aleutians East Borough. This hasn't happened since the demise of Reeve Aleutian Airways in 2002, he said. The smaller planes PenAir flies more frequently move fewer people at a time, and it's harder to move air freight, he said.

"We want to be in a position, with facilities at Cold Bay, for Alaska Airlines to make intermediate stops at Cold Bay, bringing two 727s into Cold Bay a week. Then in a couple of years, start building on some of the charter business," he said.

"We feel there is a potential to develop Cold Bay into a regional hub, with 30,000 passengers a year coming through that improved airport," he said. "We think that would bring more people back to live in Cold Bay."

Alaska Airlines, meanwhile, is monitoring the progress of the terminal, but has no immediate plans to add flights at this time, said spokeswoman Amanda Tobin. Alaska Airlines currently partners with PenAir for flights to Cold Bay, she said.