Analysis by Tim Bradner
Journal Reporter

The fulfilled promise of the Trans-Alaska Pipeline System is 25 years old in August. A quarter of a century ago this month, the first crude oil from the North Slope was delivered to a large crude oil tanker in Valdez and left for market.

The pipeline ushered in profound economic and social changes in Alaska. It ranks with the Klondike gold rush, the military buildup for World War II and statehood in its significance for Alaska's growth and development.

Not many Alaskans know that Alaska Natives were instrumental in securing final government approvals for the pipeline, however. Nor is the connection well understood between TAPS and creation of the large and well-financed Native development corporations that are important sources of economic and resource development in Alaska today.

In 1969, Atlantic Richfield Co., Humble Oil & Refining Co., now Exxon Mobil Corp., and British Petroleum Corp. announced large discoveries of oil at Prudhoe Bay on the North Slope. A pipeline across Alaska to a southern ice-free port was needed.

An approximate route for the pipeline was determined, and building began on a construction access road from the Elliot Highway, near Livengood north of Fairbanks, to the Yukon River. This was the first part of what is now the Dalton Highway.

Then, construction stopped. It would be more than four years before work resumed on the trans-Alaska oil pipeline.

What stopped the construction crews was a court injunction ordered by a federal court after three Interior Alaska villages, led by Stevens Village on the Yukon River, filed a lawsuit. The villages contested the grant of a right of way across federal lands that were claimed by the villages. Since those claims were unresolved, the government shouldn't issue the right of way, the villages argued.

The court agreed.

It was then that the petroleum industry woke to the seriousness of the unresolved land claim issue and the need to get it settled, to clear title for a land corridor for the pipeline.

The Stevens Village injunction was to have serious consequences because it delayed the start of construction until, shortly afterward, the National Environmental Protection Act became law.

That set the stage for lawsuits by environmental groups and four years of delay.

But while the industry and the government worked their way through the lawsuits, the original Stevens Village injunction led, in the meantime, to a cooperative effort between Alaska Native groups and industry to get the claims issue settled and title to lands cleared.

It was an arrangement of convenience, of course.

Native groups wanted their lands, and industry wanted its pipeline corridor.

But the influential petroleum lobby in Congress lent its weight quietly to securing passage of a bill to settle land claims in Alaska and brought the matter to the attention of senators and congressmen from districts that knew little about Alaska.

The result was that in late 1971 Congress passed the Alaska Native Claims Settlement Act. It was signed into law Dec. 18 of that year by President Richard Nixon.

Passage of the claims act, however, proved to be only the first phase of a longer-term partnership between the industry and Alaska Native groups, however.

In 1971 the petroleum industry provided an influential, even crucial lobbying force for passage of the claims act. Two years later, in 1973, Alaska Natives returned the favor and provided influential, even crucial, lobbying for passage of the Trans-Alaska Pipeline Authorization Act.

This was the federal law that cut through the web of environmental lawsuits that would have continued to bog down the pipeline, delaying the project for years more.

Again, this was a cooperation born of mutual convenience. The industry needed the new law, and Alaska Natives needed the pipeline.

More than half of the $962 million cash settlement of the claims act, or $500 million, was to be paid from a temporary federal royalty override on state royalties from Prudhoe Bay oil production.

The pipeline was needed so the $500 million could be paid.

Alaska Natives' support for the pipeline authorization law was important because just as the petroleum industry got support for the claims act from conservatives and Republicans in Congress, Alaska Natives could get the attention, and support, for the pipeline from liberals and Democrats.

Even though the nation was approaching its first energy crisis -- the 1973 Arab-Israeli war and the resulting first oil embargo had just happened -- passage of the pipeline bill that year was by no means certain.

In fact, there was a 50-50 tie vote in the U.S. Senate, broken only when Vice President Spiro Agnew cast the deciding vote for the pipeline.

The pipeline set the stage for sweeping changes in Alaska. Millions of dollars of new revenues flowed into the state treasury and flowed out again as appropriations for state projects and programs that changed the face of Alaska.

The pipeline made possible the Alaska Permanent Fund and the citizen dividend program.

Ongoing development of the North Slope and the spending of oil revenues allowed Alaska's economy to grow and develop and to support a larger population.

But just as the pipeline created profound changes in Alaska, so has the 1971 Native claims act.

The settlement put 45 million acres of Alaska lands into private ownership and created private Native-owned development corporations. In the years since, the corporation invested heavily in Alaska business, industrial and natural resource development, creating thousands of new jobs.

The claims act had other consequences. It carried with it a mandate, for example, to make changes in how other public lands in Alaska were managed.

These were culminated in the Alaska National Interest Lands Conservation Act of 1980, which created huge new national parks, wildlife refuges, national forests and millions of acres of formally designated wilderness across Alaska.

Through all this, however, the partnership between the petroleum industry and Alaska Natives was to take new forms.

While the pipeline was in construction, subsidiaries of the newly formed Native development corporations provided support services, such as security. The success of these contract relationships led to catering, camp services, security and other contracts in the North Slope oil fields.

Eventually, Alaska Native corporations were to invest in drilling rigs and construction companies and even partner with major oil companies in bidding for leases in state oil and gas lease sales.

Today, several Alaska Native corporations own a small part of the Endicott oil field on the North Slope. Two corporations, Doyon Ltd. and Calista Corp., own drilling companies, and Natchiq Inc., owned by Arctic Slope Regional Corp., is a major oil field service and construction company.

Meanwhile, some public policy issues set in motion by the pipeline, the claims act and the Alaska National Interest Lands Act remain unresolved.

For example, the debate in Congress over oil and gas exploration in a part of the coastal plain of the Arctic National Wildlife Refuge flows from a section in ANILCA that requires a 1.5 million acre area of the refuge's coastal plain to be considered for its petroleum potential.