Aleut Corp. wants to export Adak water

Photo - Wesley Loy, For the Journal

Tony Cange, president of Aleut Real Estate LLC, a subsidiary of the Aleut Corp., stands by a map of Adak Island. The Aleut Corp. has applied for rights to take water from lakes on Adak Island, in hopes of exporting the water, where it would be bottled and sold in China and India. Two other groups also are pursuing Alaska water export projects.
Photo - Wesley Loy, For the Journal

An Alaska Native regional corporation is applying to the state for rights to support bulk water exports to thirsty Asian markets.

Anchorage-based Aleut Corp. wants to withdraw up to 500,000 gallons per day from each of three freshwater lakes on Adak Island, a former Navy outpost midway out the Aleutian chain some 1,200 miles southwest of Anchorage.

The water would be loaded onto food-grade tankers and then hauled across the Pacific for bottled sales to people in China and India increasingly in need of drinking water, said Tony Cange, president Aleut Real Estate LLC, a subsidiary of the Aleut Corp.

"People have been trying to do this in various locations for several years," Cange said. "A lot of the economics are starting to work out. The demand is there."

Indeed, the idea of shipping bulk water Outside isn’t new. Former Alaska Gov. Wally Hickel, for example, talked of building a water pipeline to California, and one company in the early 1990s floated a plan to tow out enormous nylon bags filled with Southeast Alaska water.

As with oil, natural gas, gold, fish and land, Alaska is blessed with enormous stores of fresh water about 40 percent of the nation’s entire resource. So it’s natural to think of exporting some of this water for profit.

So far, no one has been able to uncork a major bulk water exporting operation from Alaska.

But suddenly, something of a race has developed to see who can do it first. Aside from the Aleut Corp., two other groups are pursuing water export projects:

Aqueous Northern Holdings LLC, based in Anchorage, on July 19 applied to the state Department of Natural Resources for water rights at four Southeast locations. Ric Davidge, state water director under Hickel, is associated with Aqueous.

S2C Global Systems Inc., a small publicly traded company based in San Antonio, on July 7 announced plans to launch a "world water hub" on the west coast of India using billions of gallons of water shipped from Sitka on Baranof Island. The city and borough of Sitka already holds a state export permit and has a contract to sell bulk water at a penny per gallon to True Alaska Bottling Co., an S2C partner. The water would come from the Blue Lake reservoir near Sitka.

The Aleut Corp. has applied for rights to take water from three lakes on Adak Island Lake Bonnie Rose, Lake De Marie and Lake Betty. Two of the lakes supplied the former Adak naval station, once home to more than 6,000 people before the military made its exit in 1997.

In a land swap with the federal government, the Aleut Corp. assumed ownership of 46,000 acres on Adak after the base closure, and the roughly 100 residents there today are building a civilian town based on commercial fishing, marine fuel sales and the like.

Water exports could boost the fledgling city’s revenue stream and help develop local infrastructure, Cange said.

"With an abundance of water on Adak, we look forward to being on the forefront of providing clean water to areas that are not as fortunate," added Thomas Mack, Aleut Corp. president.

The Aleut Corp. itself would not export the water. Rather, it would sell bulk water to an export company.

The corporation is talking with a foreign firm pulling together investors for a venture to market bottled water in China and India, Cange said. The bottling would be done in China.

Cange declined to identify the foreign company, but WaterNews cited a Vancouver, British Columbia, concern. WaterNews is published by Circle of Blue, a nonprofit tracking what it calls the "global freshwater crisis."

"We don’t have anything in ink right now," Cange said, noting a lot of moving parts must come together to make Alaska water exports work.

He believes Adak has advantages, including its relative proximity to Asia and existing docks capable of berthing large tankers.

As for its supply of pure water, Adak is endowed with a huge surplus. A project description the Aleut Corp. submitted to the state says a maximum of 45 million gallons of water per month would be drawn from the lakes for export. According to a hydrology study prepared in 2000, the withdrawals would amount to only 7 percent of total monthly watershed input.

A huge volume of fresh water runs off to the ocean daily, Cange said.

Winning state permission to export water isn’t easy. The process will take months as the state prepares a public interest finding to make sure enough water is reserved for fish, and that exports wouldn’t risk adequate supplies for local drinking water and industry such as seafood processing.

The state wants to see evidence of a real project and won’t grant rights to Alaska water based on speculation, said Gary Prokosch, chief of the water resources at DNR.

08/19/2010 - 8:00pm