Managers must respond to employee behavior problems

Unsatisfactory behavior in the workplace is a painful reality and a key reason for low morale and low productivity. Do you have people in your office failing to pull their weight? Do they cause problems for everyone else?One point is clear: Unsatisfactory behavior does not magically go away and only gets worse when ignored.Certain types of unsatisfactory behavior in the workplace, such as sexual harassment and discrimination, are readily identified. Other forms of unsatisfactory behavior may not be so easily identified.Small, irritating events such as tardiness, not completing assignments and missing deadlines occur repeatedly over time and can lower the performance of all concerned. Keep in mind that what appears to be a small issue to you can be a major issue with your employees.What type of behavior requires intervention?Anything that disrupts the office, impacts on productivity or poses a threat to other employees needs addressing.The degree to which you tolerate a situation before intervention may vary. A manager may not feel it necessary to intervene when a minor exchange of words occurs between employees, unless such an incident becomes a daily occurrence and expands beyond the employees initially involved. When handling unsatisfactory behavior, some basic guidelines apply. Get all the information.Few situations are exactly as they seem or as presented to you by others. Before you try to manage the behavior problem, insure you have investigated both sides of the issue. Evaluate the information.The old adage, "Haste makes waste," has more truth in it than we sometimes realize.Take time to evaluate all the information surrounding the unsatisfactory behavior. Identify the potential causes that may have created the unsatisfactory behavior. Is the problem due to a lack of resources? Or could it be a training problem?Finally, determine if it is an attitude problem or willful neglect. A too-quick decision does more harm than good when it turns out to be the wrong decision. Address the situation.Once you have collected and evaluated the information, you are ready to address the issue with the employee. Let the employee know you would like to meet with them.Let them know the place and time you want to meet.Focus on the problem, not the individual.Avoid your own preconceived attitudes about troublesome employees. Employee X may not be the most congenial of your employees, but you should deal with all unsatisfactory behavior regardless of the personality of the individual. Focus on identifying and resolving the problem.If, after careful and thorough investigation, you determine the individual is the problem, then focus on the individual at that point. Keep the communication open.The ultimate goal is to resolve the issue and set parameters for satisfactory behavior. Begin the meeting in a positive, but firm manner. Allow the employee to express their viewpoint, but also share your perspective.Attempt to facilitate the discussion and help the individual focus on the issue causing conflict. Keep the discussion on target.Mature individuals accept responsibility for their behavior and show initiative for improvement.On the other hand, some individuals tend to blame other people and situations for their lack of performance. Be careful not to lose control of the meeting. Your goal as a supervisor is to keep the employee focused on the issue at hand and avoid extraneous information. A good way to retain control is to say, "Yes, I understand there are other issues we need to look at, but let’s focus on the main reason I called this meeting." Avoid losing your temper and using coercion.Yelling at someone or coercing people may stop the problem temporary, but do not fool yourself into thinking it is a long-term solution. Odds are the problem will resurface.At that point not only will you have the initial problem to deal with but also the angry feelings that have festered below the surface during the interim. Establish expectations and guidelines.Once you have taken time to gather information, talked to all the parties involved and discussed the unsatisfactory behavior, it is now time for the next step. Clearly outline what satisfactory behavior should look like.Explain your expectations and develop an action plan. The employee may not all agree with your decision, but at least they will know where you stand. Make a record of the meeting.The final step is to document the meeting and write down what both you and the employee agreed to do. Schedule a follow-up meeting and bring the meeting to an end.Gregory P. Smith is the president of a management consulting firm called Chart Your Course International in Conyers, Georgia. He can be reached at 770-860-9464.

Industry begins building Kenai salmon brand

KENAI -- Kenai Peninsula leaders and commercial fishing representatives are trying to make a name for their salmon.A $400,000 project to boost the Cook Inlet salmon industry, partly funded by the borough, kicks off this summer with quality control inspectors to make sure the "Kenai Wild" brand lives up to its new name.The program will certify salmon that meet handling and quality standards to develop a niche market for the product at organic supermarkets and restaurants.This year the project will monitor sockeye salmon and aims to produce up to 12,000 pounds of headed and gutted fillets, said Jack Brown, the Kenai Peninsula Borough Community & Economic Development Division’s business development manager.By late June two local inspectors and three others from Seattle-based Surefish Seafood Quality Specialists were to begin inspections at harvest sites, Brown said.They should work the sockeye salmon run through early August, he said. Next year local inspectors will work two to three months, then four to six months in 2004, he said. One day the brand could also include halibut and cod."The commercial fishing salmon industry is on the ropes," he said, citing the effects of cheap farmed salmon on the Alaska industry. "In order for the industry to be viable for the future they have to change the way they operate."The idea for the project began last year when Dale Bagley, borough mayor, attended a seafood forum and dispatched consultants to study the viability of a Cook Inlet brand. The program operates as Cook Inlet Salmon Brand Inc. with a 13-member board, Brown said.The borough has given the project $168,000, Brown said. The Alaska Manufacturers Association gave $112,000 and the state Department of Community and Economic Development another $120,000. Another $95,000 is in the state budget awaiting approval from Gov. Tony Knowles, Brown said.Most of the funds will be spent on teaching fishermen and plant and tender operators about quality control and handling procedures, he said.Earlier this year Brown and Bagley attended the World Trade Center Alaska’s seafood forum and spoke with buyers for organic supermarkets. "They insisted that fish must be bled and iced," he said. According to the buyers, fish products get one chance to make a good impression, Brown recalled.In the past Alaska hasn’t met such standards, which are now demanded, he said.Brown hopes the Kenai Wild brand will create demand and climbing prices, eventually boosting employment.In 1980 the commercial fishing accounted for 14.7 percent of average borough monthly employment. In 2000 that figure had dropped to 3.9 percent.This year the Cook Inlet brand program aims to certify up to 12,000 pounds, he said. But one of the three volunteer processors, Snug Harbor Seafoods Inc. of Kenai, wants to certify 100,000 pounds.Paul Dale, Snug Harbor Seafoods president, believes the program will find swifter success with a higher volume. Still, the priority is quality control, he said.The processors’ certified fish are destined for U.S. fresh markets, and the company has specific buyers lined up, he said. Other processors in the program this year are Salamatof Seafoods Inc. of Kenai and Deep Creek Custom Packing of Soldotna."One of the biggest benefits we’ve seen is cooperation between government, fish processors and commercial fishermen," said Mark Powell, president of both the Cook Inlet brand board and Alaska Salmon Purchasers Inc. "We hope we’re the model for other areas of the state to follow."Yet, Kenai Wild has its own mentor."A lot of people have been inspired by the Copper River program," said Laura Fleming, spokeswoman for the Alaska Seafood Marketing Institute.That effort took at least 15 years of work and required community support and cooperation from harvesters and processors, she said. Bristol Bay, Chignik and Kodiak fishermen also are considering a regional brand name project, she said.ASMI markets its own branding, Alaska Seafood, and is prohibited from promoting a region’s brand, Fleming said.Despite the increase in regional brands, Fleming believes the timing of fishing seasons will restrict competition among them. Marketers also must promote the distinct characteristics of their product, she said. Consumers are becoming sophisticated enough to recognize differences, she said.The borough’s investment makes the Cook Inlet program stand out. "Public dollars were allocated, which is a huge expression of the importance of it to the economy, and it’s a pledge to support the brand," Fleming said.

Company seeks funding to provide utility gas to Southeast

PETERSBURG -- A plan to bring natural gas to more than a dozen Southeast Alaska communities faces several hurdles, including finding about $80 million to fund the project.If the Alaska Intrastate Gas Co. can find the funding, the project would begin by serving Ketchikan with utility gas, not natural gas.Natural gas is methane and utility gas is a mixture of propane and dry air. The utility gas would be shipped in rail tanks on barges from British Columbia. Each community would have a storage facility and underground distribution lines.Ketchikan would require $20 million in infrastructure. Sitka and Juneau would follow with another $50 million to get those systems going.The company said it can provide residents with a less-expensive alternative to fuel oil, electricity or propane for heating homes, water tanks, dryers and stoves.A recent feasibility study paid for by the company suggests it can cut customers’ costs by at least 20 percent once a home or business has the appropriate appliances or is retrofitted."We have a superior product and a cheaper product that will result in economic benefits to all consumers and the industrial folks in particular," the gas company’s senior vice president, Paul Rusanowski, told CoastAlaska radio network.One of the company’s assumptions is that all of the seafood processors in Ketchikan, Sitka and Juneau would convert to gas. But the company does not have any firm commitments.Bob Poe, executive director of the Alaska Industrial Development and Export Authority, said there are several possibilities for funding the project.That includes funding by AIDEA that would help with the initial phase, providing service to Ketchikan, and afterward assess whether the additional phases are realistic.Poe said another option is conduit bonds, which require other investors. A couple of bond companies have eyed the project but Poe said the feasibility study needs additional information.The possibility that AIDEA may offer financial assistance to the gas company is bothersome to officials with the 4-Dam Pool electric utility. The group recently purchased four hydroelectric facilities from the state, including Ketchikan’s Swan Lake plant and the Tyee plant, which supplies power to Wrangell and Petersburg.Acting director Dave Carlson said it doesn’t make sense to lend the 4-Dam Pool money to buy the hydro plants only to also offer financing for a company in direct competition."I understand that part of their plan is to try and hook up the canneries to use this. That would cause a decrease in kilowatt hour sales," Carlson said.But Rusanowski said offering utility gas should improve development opportunities and ultimately increase demand for electrical companies."We’re not going after the major electrical loads. We’re primarily going after the home and hot water loads."

Ferries, Glenn get byways status

JUNEAU -- The federal government has recognized the Alaska Marine Highway and the Glenn Highway as National Scenic Byways, which help the state obtain more money for tourism marketing.The two were among 35 roads around the country to receive the designation June 13 from the U.S. Department of Transportation.Diane Regan, scenic byways coordinator with the state Department of Transportation, said the ferry system is the first water-based route in the nation to achieve the status. To qualify, a road must have significant scenic, natural, recreational, historical, archaeological or cultural qualities.The designation could help promote tourism on the routes, said Gov. Tony Knowles’ spokesman Bob King.The routes will also receive a higher ranking in competition for grants for planning, marketing and building wayside stops and interpretive displays, Regan said. The designation won’t bring any money for normal maintenance.The only other Alaska highway with such a federal designation is the Seward Highway.

Kodiak salmon fishermen reach price agreement

KODIAK -- Kodiak salmon fishermen began fishing June 16, ending a five-day stand down after signing a contract June 14 with a local processor.The fishermen had been staying onshore while the United Salmon Association held price negotiations with processors."This has been a grim week for our fishermen, but the gains in price offset the loss of six fishing days," said Thom Wischer, chairman of the United Salmon Association.The group reached an agreement with True World Foods, formally known as International Seafoods of Alaska. Under the agreement, fishermen agreed to a price of 59 cents a pound for sockeye salmon and 7 cents a pound for pink salmon.

Super Cub creates new industry

Besides oil, Lee Budde believes Alaska only has three highly marketable items: "seafood, scenery and Super Cubs."While fishing and tourism industries have seen their share of economic nosedives in recent years, money and jobs generated solely by the Piper Super Cub airplane in Alaska continue to rise.Countless Alaskans earn their livings by rebuilding, repairing, flying or building parts for the venerable Super Cub, an airplane synonymous with Alaska aviation."You can’t swing a dead cat in Alaska without hitting someone who repairs Super Cubs," said Budde, who along with his wife Jennifer, own Big Lake-based Airframes Inc., a company that repairs, rebuilds and makes new fuselages and various parts for the airplane.Some 7,750 of the no-frills, steel-framed, fabric-skinned, single-engine airplanes were made from 1949 to 1995, when production ceased after the Piper Aircraft Corp. went out of business.By several estimates, Alaska is home to at least a quarter of all Super Cubs produced. The airplane’s simplicity and short take-off and landing capabilities make it a favorite for Bush pilots, who often refer to the practical little plane as the "Alaska jeep."No landing strip is not a problem for the Super Cub, which can easily land on gravel bars and mountainsides.Hunting guide Kirk Ellis of Nabesna says without the Super Cub, he’d be out of work."I’ve tried them all and it’s the only airplane that can do the job," Ellis said.The highly sought after airplane has such a cult following in Alaska that Budde said he knows pilots who prioritize the airplane over other essentials of life. "People will live underneath a blue tarp just so they can own a Super Cub," Budde said, "and some of them do." Budde, along with his wife and 10 employees, produce complete replacement fuselages for the Super Cub, including a new Federal Aviation Administration-approved frame that is 4 inches wider than the original.That extra room is welcomed by more portly pilots, Budde said."It’s the difference between being cramped and comfortable," said Budde who said his shoulders touch both bulkheads in a standard Super Cub.Fuselages range in price from about $11,000 to $14,000 for the wider model.In his four years of business, Budde has produced about 115 frames, which he says are a vast improvement over factory-made models."Ours is a stronger, more sensible design of the structure," Budde said.This year, he expects production to reach 70 fuselages. The increased production is in part thanks to an order of about 30 frames from Cub Crafters Inc., a Yakima, Wash.-based company producing a Super Cub clone known as the Top Cub.Budde said shipping the 17-foot long, 104-pound fuselages to the Lower 48 is cheap because nearly all containers headed south are empty anyway."We’re doing OK out here in the middle of nowhere because of our quality," Budde said. "Ten families, besides our own, are making a living off of this."A superior Super CubNathan Richmond, along with his father Jim, started building the Top Cubs three years ago, and have sold about 50 airplanes to date.Nathan Richmond said the airplanes are far superior to the old Super Cubs due to advances in technology, like better engines and landing gear, and because of the better frames made by Budde, who supplies about half of the fuselages to the company. "Lee (Budde) does a fantastic job building fuselages for us," said Richmond.Six of the hand-built airplanes, which sell for an average of about $150,000, have been sold in Alaska, including two that were delivered in Anchorage in mid-June, Nathan Richmond said.Cub Crafters expects at least 20 percent of its market will be in Alaska, Richmond said.The company also rebuilds old Super Cubs to like-new specifications, which can cost about $80,000.Super Cubs, when introduced by Piper more than 50 years ago, sold for about $3,000.Cub Crafters all-new airplane has sparked objections from the New Piper Aircraft Inc., which emerged after the old Piper company folded, but it no longer produces Super Cubs.Mark Miller, spokesman for New Piper Aircraft officials in Vero Beach, Fla., said his company is asking the Federal Aviation Administration to force Cub Crafters to stop making the Super Cub clones.Miller said New Piper wants Cub Crafters to quit using "Cub" in its name, and to stop making the Top Cub altogether, fearing lawsuits that would link the two companies."It’s like someone building an airplane just like a Boeing 747 and putting ’Top’ Boeing on it," Miller said. "There is a huge safety issue for the public and a liability issue for us that could come to rest on our doorstep."Miller said his company stopped making the Super Cub because it could not get insurance on the airplane."It’s an antique," Miller said. "Don’t get me wrong, we are proud of the Cub and proud of the Cubs we made, just as I’m sure Henry Ford was proud of the Model T."Miller said he believes the FAA will side with his company ultimately, but if not, the issue will go to court.Cub Crafters’ Richmond said so far the FAA has sided with his company and nothing prohibits them from building the new airplane."They wish nobody was building the airplane, but they have no legal grounds," Richmond said.Richmond said the demand for Super Cubs might not ever go away, and his company is banking on it, especially in Alaska."Super Cubs, like Harley-Davidsons, have a cult-like following and they are dearly loved," Richmond said. "Everyone who owns a Super Cub dreams of flying it to Alaska. And all of our customers always want all of the ’Alaska mods.’"’Guru and grandmaster’ of Super Cub modificationsWhen it comes to modifying a Super Cub, F. Atlee Dodge is legendary.Dodge has been working on Super Cubs for most of his 80 years and is considered the "guru" and "grandmaster" of Super Cub modifications. He’s most often referred to as "Mr. Cub" in the Super Cub circles."It’s a good airplane, it really is and I’ve been around them for a long time," said Dodge, owner of F. Atlee Dodge Aircraft Services Inc. in Anchorage.He’s designed or redesigned everything from landing gear to lumber racks for the Super Cub. Some of his most popular items are engine cowlings, exhaust systems, heaters, folding seats, expanded fuel tanks, float fittings, skis and ski rigging parts and an enclosed baggage compartment."I’ve made enough of the stuff for them to gain the reputation," Dodge said.Although he specializes in Super Cubs, Dodge has made parts for nearly anything that flies.Dodge’s products are mostly shipped to Canada and Alaska where the greatest concentrations of Super Cubs are. Shipments go out daily to the Lower 48 and around the world. In any given week, Dodge’s company ships Super Cub parts to far away places like Borneo and South Africa."We ship stuff everywhere," Dodge said.Dodge employees 13 people at his South Anchorage business located off O’Malley Road, where he has been since 1957.Business making parts is so brisk with Super Cubs and other airplanes that Dodge said he is looking to expand elsewhere in Anchorage soon. His designs have been copied by many over the years, but nearly any Super Cub aficionado will tell you F. Atlee Dodge products are superior.Dodge has rarely advertised over the years and has grown his Anchorage business by word-of-mouth. "We’ve never been out of work," he said.Dan Hollingsworth, of Dan’s Aircraft Repair Inc., offers many of Dodge’s parts on his Super Cub rebuilds. The company, based at Merrill Field in Anchorage, claims to be the largest Super Cub rebuilder in the state.Hollingsworth said his 15-year-old company employs 10 people.Hollingsworth said a complete rebuild, depending on the work needed, can cost upwards of $95,000 and take between three and four months, involving hundreds of hours of labor. In the end, he says, the plane is better than it was the day it came from the Piper factory.Hollingsworth also will fetch or repair on-site crashed airplanes from anywhere in the state, as he has done on several occasions.The lure of the Super CubLura and Vern Kingsford of Scenic Mountain Air use Super Cubs on floats for flight instruction in the Bush."The Super Cub is the epitome of the Bush plane in Alaska," said Lura Kingsford, who along with her husband offer float-rating instruction at their Moose Pass headquarters.Not only are they offering float certifications, the couple is doing their part for tourism using the Super Cub.The company has about 80 pilots annually take the course, two-thirds of whom come from the Lower 48.The instruction is popular with everyone from new pilots to airline pilots, Lura Kingsford said. At least one astronaut, Cady Coleman, has taken the three-day course, which touts itself as the "boot camp" of float ratings. Vern Kingsford has been flying in Alaska for about 30 years, chalking up some 14,000 hours of flight time, including more than 4,000 hours on floats.Pilots can earn float ratings nearly anywhere Outside, Lura Kingsford said. But flying in Bush Alaska, in the tiny airplane associated with the state, is a strong marketing tool."People can get float ratings flying over a trailer park in Florida, but what we do is the epitome of Bush flying," Lura Kingsford said. "We fulfill people’s dreams."

DNR approves expansion of True North gold mine

FAIRBANKS -- The Department of Natural Resources has approved the expansion of the True North gold mine north of Fairbanks.The agency also said June 12 that the mine’s existing haul road does not hurt winter tourism.The mine is located in the Cleary Summit area between the Steese and Elliott highways about 30 miles north of Fairbanks, near several facilities that cater to aurora borealis-viewing tourists in the winter.A group of area residents, called Neighborhood Mine Watch, filed an appeal last year of the mine’s construction.The group complained about lights and noise from trucks that carry ore from the mine 24 hours a day. Residents said the trucks disrupt sleep as well as tourism businesses that cater to visitors who want to view the northern lights.Superior Court Judge Charles Pengilly ruled earlier this year that the state had neglected to conduct a proper economic study on the right-of-way permit for the mine’s 10-mile ore haul road.Pengilly remanded the decision back to DNR with orders to conduct the study.On June 12, the results of that study were released, with DNR concluding that the potential economic impact of the lights, noise and dust of ore trucks on the haul road on tourist numbers was not enough to offset the positive economic impact of the mine.The study found that, while tourist numbers declined precipitously over the winter of 2001-02, the majority of the loss was due to the Sept. 11 terrorist attacks."Other aurora-viewing locations report a similarly steep loss,’’ the report said.The study concluded that the millions of dollars paid by the mine in taxes and other fees, as well as the jobs created and other indirect economic impacts, outweigh the possible loss of tourists to Cleary Summit-area businesses.It also noted that such losses could be offset by increases in other areas if tourists choose to book accommodations elsewhere in the borough during the life of the mine.The agency also authorized the mine’s expansion of operations to tap additional gold reserves discovered during 2001, digging a total of three new pits to go with the existing two. Two of the new pits would be contiguous to an existing one, in effect forming one larger pit. The expansion would increase the mine’s operations by about 600 acres and extend its life by about a year to 18 months to a total of more than four years.The mine has been in operation since March 2001.

Judge blocks Tongass sales in roadless areas

ANCHORAGE -- A federal judge June 11 halted new timber sales in roadless areas of the Tongass National Forest until the U.S. Forest Service finishes work on a court-ordered environmental impact study.Plaintiffs in the case, including the Sierra Club, asked for the hearing in U.S. District Court in Anchorage to get Judge James Singleton to clarify an order he issued April 26.Singleton decided in April that five pending timber sales, the Upper Carroll, South Lindy, Four Leaf, South Arm and King George, could proceed. The sales contain about 62 million board feet of timber in the Craig, Ketchikan and Wrangell areas.But those were the only exceptions the judge made in an order that otherwise prohibited the Forest Service from permitting timber harvest or road building in roadless areas until 45 days after the study is completed.Plaintiffs in the case, which focused on 19 Tongass timber sales in remote areas, wanted clarification on what the judge’s order meant for timber sales. Singleton found June 11 that his April order did prohibit the Forest Service from allowing for additional timber sales in the roadless areas until the agency completes the study, said Jim Ustasiewski, an attorney for the Forest Service in Juneau.Singleton ordered the study in March 2001. Ustasiewski said the study should be completed by the end of the year. A draft study is undergoing public comment.Deirdre McDonnell, a lawyer who argued the case for the group Earthjustice, said the decision underscored the judge’s wish to have "a fair and full consideration of all the areas.’’A call to the Alaska Forest Association in Ketchikan was not immediately returned.The Forest Service had argued that the agency was still revising the study and did not need to manage roadless areas as wilderness while it was still working on the plan.The judge ruled last year that the Forest Service violated federal law when it failed to consider some areas for wilderness designation in issuing the 1997 Tongass Land Management Plan. He issued a temporary injunction that halted logging in the forest for nearly two months.

Railroad spends $52 million on capital projects this year

More than $52 million in capital improvements are planned by the Alaska Railroad Corp. this year with much of the work this summer.The railroad also added $20 million to its coffers June 10 with an appropriation from the U.S. Department of Transportation, money secured by Sen. Ted Stevens, R-Alaska.That brings to $288 million the railroad has received since 1996 for improvements to the state-owned railroad, said Patrick Flynn, Alaska Railroad’s public affairs officer.In 2001, the railroad had some $73 million earmarked for capital improvements, $20.5 million more than this year.The additional money came mainly from a $13 million federal reimbursement to the railroad for fuel spills it had in 1999 at Canyon and at Gold Creek, where 15 cars left the track, five of them spilling more than 120,000 gallons of jet fuel.Major work slated for this summer by the railroad includes continued improvements on rail, ties, bridges, sidings and switches throughout the 498-mile line and the second phase of upgrading and straightening of mainline between Anchorage and Wasilla.The railroad began construction last spring on the project that will straighten some 70 curves on the Anchorage-to-Wasilla line. Some road crossings along the track also will be improved for increased safety, according to the railroad.When all three phases are completed in 2004 at a cost of $78 million, railroad officials said the travel time between Anchorage and Wasilla will drop from 90 minutes to just under an hour. Trains should be able to maintain speeds of about 50 mph instead of slowing to 20-25 mph. The Alaska Railroad this spring completed its $2.3 million rail-yard underpass at Whittier. The 300-foot-long underpass was installed to provide safe passage to pedestrians while crossing the rail yard, according to the railroad.Improvements totaling $1.6 million to the Whittier barge slip facility is ongoing this year, with completion slated for 2003.Other projects under construction this year with completion slated for 2003 include the $4.5 million Denali National Park rail station; a $2.2 million equipment maintenance facility in Whittier; and $510,000 in improvements to the Talkeetna depot.

Business Profile

Name of Company: Kennicott Glacier LodgeEstablished: 1987Location: Kennicott, AK 99588Anchorage office: 3000 A St., Suite 202, or P.O. Box 103940, Anchorage, AK 99510Telephone: 907-258-2350; 800-582-5128Web site: www.KennicottLodge.comE-mail: [email protected] focus of services: Located in the center of the Kennicott ghost town, the Kennicott Glacier Lodge offers 25 guest rooms, a dining room, two living rooms and a 190-foot long front porch with a panoramic view of the Chugach and Wrangell mountains. Rooms are decorated with mining artifacts and old photographs. The lodge’s restaurant serves homemade meals for breakfast, lunch and dinner and is open to visitors and the community. The lodge works with local guide services to provide flightseeing tours, glacier hikes, river rafting and ghost town tours.History of the company: Richard Kirkwood built the lodge in 1987 as a replica of a historic mining building from the copper-mining boom town days. Kennicott Glacier Lodge opened with eight rooms, but soon 12 were finished. In 1993 Kirkwood expanded to the present 25 rooms.The lodge owner is currently building a new addition that will add 10 rooms with private baths, a living room and a small dining area to the complex. The addition is scheduled for completion in 2003. Another 10 rooms can be built on the site.When the lodge opened, only Kirkwood and one employee kept it running. He continues to work full time at the lodge but employs 24 full-time seasonal employees. During the off-season, Kirkwood maintains an office in Anchorage. The office is also staffed year-round by a sales agent.Top accomplishment of the company: The lodge owner is proud that Kennicott Glacier Lodge "shows people a beautiful part of Alaska." He is proud of his repeat customers and their many referrals. Kirkwood feels that the surrounding National Park Service’s National Historic Landmark contains a piece of Alaska history and that Kennicott in 1915 was the most modern city in Alaska, boasting steam heat and electricity.Major player: Richard Kirkwood, principal owner, Kennicott Glacier LodgeKirkwood arrived in Alaska from Illinois in 1975 to "live in the wilderness." Kirkwood has a master’s degree in mechanical engineering.Top issue facing the company: Kirkwood is convinced the country sells itself and once people visit, they return. He believes it is too expensive for small companies to attract visitors from outside Alaska and it is a state function to do so. He wishes the state would market Alaska and feels the state reached the peak of its generic marketing in 1996.The reservations for this summer’s season are down slightly so far, according to Kirkwood, but he’s "hoping they’re going up."-- Victoria Zerbe

Management council establishes Bering Sea crab quotas

UNALASKA -- The North Pacific Fishery Management Council approved a plan June 10 to restructure the Bering Sea crab industry with a quota-based system aimed at improving safety and management. The vote was 11-0.Gov. Tony Knowles’ representative on the council, Kevin Duffy, pushed through the "three pie" rationalization system, with quotas for fishermen, processors and regions.A provision allowing for collective bargaining was included, aimed at calming fishermen’s fears of processor quotas leading to artificially low prices.Established local companies will receive 90 percent of processor quotas, with 10 percent in an open access section.Of the harvester quotas, 97 percent goes to boat owners, with 3 percent to captains.Under the plan, the Bering Sea harvest would be split between communities in northern and southern regions to protect the economy of the Pribilof Islands.The quota system creates a new form of wealth. Harvester shares alone could be worth $850 million, according Arne Thomson of the Alaska Crab Coalition, based on the valuation for halibut individual fishing quotas.Council member Bob Penney said crab quotas represented the giveaway of a public resource. He unsuccessfully argued that the council should have the option of collecting fees such as those collected for grazing and oil development on public lands.Crab rationalizaton still requires the approval of Congress.Fish management council members defended their action in extending quotas to crab, following earlier votes in the past decade creating quota systems for halibut, sablefish and pollock.James Balsiger called it a long-needed rationalization of the crab industry.James Fluharty said the council needs to sell the restructuring to the public and hopes to see the new system in place within six months.Stephanie Madsen said quotas will allow for improved information-gathering.The new system also expands the crab harvest under community development quotas to 10 percent, up from the current level of 7.5 percent.Duffy said his proposal does not create a closed class of processors and allows for new entrants into the fishery. He said it does not mean a return to the pre-statehood days of company towns.Many fishermen are not so sure and they opposed processor quotas while favoring harvester quotas.Beth Stewart of the Aleutians East Borough said assembly members from King Cove, Sand Point and Nelson Lagoon remember the days before statehood when canneries dominated their communities. She said the fishermen on the assembly oppose processor quotas because of that history.On June 9, about 50 processing workers demonstrated in support of processor quotas during the meeting at the Grand Aleutian Hotel. The processor demonstration was organized by the Pacific Seafood Processors Association."We wanted to show the human face of the processing sector," said Glenn Reed, association president.

Exxon Mobil fights damage award

ANCHORAGE -- Exxon Mobil Corp. filed a motion June 12 in federal court seeking to reduce a $5 billion punitive damage award from the Exxon Valdez oil tanker spill.Tom Cirigliano, Exxon Mobil spokesman, said the company is following up on a decision by a panel of the 9th U.S. Circuit Court of Appeals last November.The appeals court panel found that the $5 billion awarded by an Anchorage jury in 1994 to thousands of commercial fishermen, Alaska Natives, property owners and others harmed by the spill was excessive. It ordered the Anchorage court to reduce the award.The appeals court later refused to review its decision. Exxon Mobil had until June 17 to file its motion.Exxon Mobil argues that the punitive damages should be $25 million, the amount of the fine imposed by the government for the spill. It also says the punitive damages should not exceed $40 million, or twice the compensatory damages awarded to private plaintiffs."Pocket change," said Patience Anderson Faulkner of Cordova, when asked about the amounts suggested by Exxon Mobil. "It is going to amount to no money at all."Faulkner worked with lawyers on a class action suit following the spill to chronicle the damage and submit claims against the company.Faulkner said the effects of the spill continue to devastate the community of about 2,500 people at the southeastern end of Prince William Sound. A fishing permit before the spill cost more than $200,000, she said. Now one cost $40,000 and two-thirds of the purse seiners have given up.Exxon Mobil has maintained that Prince William Sound fully recovered from the massive oil spill years ago.The spill occurred in 1989 when the 987-foot oil tanker ran aground on a reef, spilling nearly 11 million gallons of crude. It was the worst spill in U.S. waters in history.A report issued earlier this year by the Exxon Valdez Oil Spill Trustee Council found that the area, while not yet recovered, was on its way. The council was set up in 1991 to oversee the restoration of resources hurt by the spill using the $900 million paid by Exxon to settle civil charges.Molly McCammon, the trustees’ executive director, said 13 years after the spill more oil than expected remains in the sound but there has been no discussion about additional cleanup. The council funded additional cleanup in 1998.Scientists with the National Marine Fisheries Service in January said an estimated 10,000 gallons of oil remains buried under the shoreline.Exxon Mobil says immediately following the spill Exxon, which acquired Mobil Corp. in 1999 in an $81 billion merger, paid $300 million to more than 11,000 Alaskans and businesses.Exxon also paid $2.2 billion on the cleanup from 1989 to 1992, when the state and the Coast Guard declared it was complete. It also paid $1 billion in settlements with the state of Alaska and the federal government.Cirigliano said Exxon Mobil has paid about $3.5 billion as a result of the spill."Certainly we can say $3.5 billion dollars is certainly a deterrent to Exxon Mobil or any other company to make sure this never happens again," he said.

Around the World

NATIONAlaska Air Group chief pledges to reduce costsNEW YORK -- Alaska Air Group Inc., the only major U.S. carrier whose traffic has risen this year, said June 12 it will focus on reining in costs to turn its operations around further."We’ve got to focus on cost control," said John Kelly, chairman, president and chief executive of the nation’s ninth largest carrier, at a Merrill Lynch & Co. transportation conference in New York."We’re not going to rely on the great revenue performance," the executive said.Alaska Air, of Seattle, plans to reduce its unit cost by 0.8 percent over three years and regain its position as one of the lowest-cost major airlines, said Brad Tilden, the company’s chief financial officer. The airline’s unit cost, excluding fuel, rose 4.1 percent in the first quarter from a year ago. Unit cost refers to the average cost of flying one passenger seat one mile.Alaska Air has seen its traffic exceed year-ago levels in each of the first five months of the year as the carrier restored its capacity to pre-Sept. 11 levels in February, Kelly noted.Consumer prices stable, home building climbsWASHINGTON -- Falling costs for gasoline, clothes and cars gave shoppers a break and helped to keep overall consumer prices flat in May.That, along with another government report June 18 showing housing construction last month jumped by 11.6 percent, the largest increase in nearly seven years, offered a dose of good news for the unfolding economic recovery.The flat reading in the Labor Department’s Consumer Price Index, one of the government’s most closely watched inflation gauges, came after a 0.5 percent advance in April. That rise was led by higher energy costs.The bigger-than-expected 11.6 percent increase in housing construction reported by the Commerce Department marked the largest gain since July 1995. It followed a 7.3 percent drop in April.In the CPI report, the core rate of inflation, which excludes volatile energy and food prices, edged up 0.2 percent in May, down slightly from a 0.3 percent advance the month before.Helping out May’s tame inflation showing was a 0.7 percent drop in energy prices, which had risen a sharp 4.5 percent in April.Verdict means Andersen can’t audit public firmsWASHINGTON -- A Securities and Exchange Commission rule bars any firm convicted of a felony from auditing publicly traded companies -- likely putting crippled Arthur Andersen LLP out of business.Andersen was convicted June 15 of obstructing justice by shredding Enron Corp.-related documents.After the verdict in Houston, the SEC said it was "deeply troubled by the underlying events that resulted in Andersen’s conviction, especially insofar as the verdict reflects the jury’s conclusion that Andersen engaged in conduct designed to obstruct SEC processes."The commission has been investigating the bankrupt energy trading company and Andersen’s role as its longtime auditor.Andersen informed the SEC after the verdict that it will cease auditing public companies by Aug. 31, unless the SEC determines that another date is appropriate, the commission said in a statement.Enron execs reap $744 million in salary, stockNEW YORK -- Top Enron Corp. workers reaped $744 million in payments and stock in the year leading up to its bankruptcy filing, the company disclosed June 17.Representatives of former workers and shareholders responded angrily, accusing the 144 senior managers of essentially raiding Enron’s coffers while leaving their clients with relatively little.Enron disclosed in a 1,436-page filing with the federal bankruptcy court in New York that the executives received $309.5 million in salary, bonuses, long-term incentives, loan advances and other payments. The executives also exercised stock options and received stock valued at $434.5 million, according to the filing.Among the executives who shared in the pay and awards were former chairman Kenneth Lay, former chief executive Jeffrey Skilling and former chief financial officer Andrew Fastow. Army Secretary Thomas White, who ran Enron’s retail energy services unit, was listed, and so was former board member Wendy Gramm, the wife of retiring Sen. Phil Gramm, R-Texas.Combined, this group of high-profile individuals socked away $193.7 million in the 12 months before Enron filed for Chapter 11 bankruptcy Dec. 2.Court rules cash tips can be estimated by IRSWASHINGTON -- The Internal Revenue Service can use estimates to make sure it is collecting enough taxes on cash restaurant tips, the Supreme Court said June 17.The court beefed up the IRS’ power to calculate taxes that businesses owe from employees’ tips, a thorny task because often the tips are cash and workers report their own earnings.The ruling is a defeat for the estimated 200,000 restaurants with tipped workers, and many other businesses whose employees receive tips.The court said the IRS can estimate the amount of cash tips given to employees based on tips shown on credit card receipts. The estimate is used to determine taxes.This case pitted one of the nation’s oldest Italian restaurants against U.S. tax collectors. The restaurant contends the IRS formula does not take into account stingy cash tips, takeout meals or tip-sharing among hostesses and other staff.WORLDSwiss company takes over Dreyer’s ice creamNestle SA agreed June 17 to take a majority stake in Dreyer’s Grand Ice Cream Inc. in a $2.4 billion deal that would allow the Swiss conglomerate to eventually scoop up all of California-based Dreyer’s.Nestle will merge its U.S. ice cream business, including the Haagen-Dazs brand, into Dreyer’s, the best-selling brand of packaged ice cream in the United States. Nestle would receive 55 million newly issued Dreyer’s shares, boosting its stake to 67 percent from 23 percent.Under the second part of the deal, Dreyer’s shareholders could sell their stock to Nestle for $83 a share in 2006. The following year, Nestle has the option of calling outstanding Dreyer’s shares for $88 a share. With about 17 percent of the worldwide market, the combined company is expected to compete at about the same level as the Anglo-Dugtch conglomerate Unilever, whose brands include Ben & Jerry’s, Good Humor and Breyers ice creams.Nasdaq setting up new exchange in GermanyFRANKFURT, Germany -- The U.S.-based Nasdaq Stock Market is setting up an electronic stock exchange in Germany that will compete with the country’s dominant exchange, the Frankfurt-based Deutsche Boerse.The new exchange, called Nasdaq Deutschland, will be a partnership with two of Germany’s biggest banks -- Dresdner Bank and Commerzbank -- as well as Commerzbank’s Internet bank comdirect and the Bremen and Berlin regional stock exchanges, Nasdaq announced June 18.The new exchange will begin trading in January and the company said it planned for 3,000 stocks to be traded eventually. The stocks would include German and other blue chips and growth stocks, Nasdaq said.Officials said they expected the new exchange could reach a 15 percent market share by 2005.Japanese women join work force, earn lessTOKYO -- Japanese working women are staying longer at their jobs but still haven’t made any major inroads in the workplaces of this tradition-bound nation, according to a government report released June 18.In its annual report, the Gender Equality Bureau said few women hold managerial positions, and working women continue to earn less than their male counterparts.Moreover, women still face limited career choices despite the fact that more Japanese women are joining the work force as gender roles change and the nation’s decade-long economic slump continues.Women in Japan stayed at one job for an average of 8.9 years in 2001, up from 6.8 years in 1985, the report said.But it said only 5.6 percent of all managerial posts in government and business are held by women in the capital, Tokyo, which was still higher than in any other Japanese city.Full-time working women earned only 65.3 percent of what men earned in the same position last year, the report said.-- Compiled from business wire services.

Dignitaries break ground for missile defense silos

FORT GREELY-- In less than three years, six missile silos will be 115 feet beneath the earth here where on June 15 dignitaries officially broke ground for the national missile defense system.Officials hailed the project, known as the Ground-based Midcourse Defense system."We need this for the defense of our country," said Brig. Gen. John W. Holly, program director for the GMD Joint Program Office.Lt. Gen. Ronald T. Kadish, director of the Missile Defense Agency, called missile defense a journey into a new, tough technology.Kadish, Holly and Sen. Ted Stevens, R-Alaska, were among those dignitaries brought to the site by military escort. A red carpet across a gravel pad led to pavilion tents set up between the future site of four of the six silos due to be constructed by September 2004.The Fort Greely site will at first be used for testing. But the Pentagon hopes to have it ready as an emergency anti-missile system by 2004, should the need arise.The work at Fort Greely is part of a missile defense system estimated to cost $64 billion, including a sophisticated "X-band" radar station in the Aleutian Islands and a new satellite system to detect launches.Officials have said the work at Fort Greely is expected to cost $325 million and bring 500 to 800 construction jobs and at least 100 permanent positions. Holly said construction is ahead of schedule and under budget.Stevens told reporters that the United States’ withdrawal June 13 from the Anti-Ballistic Missile Treaty with the former Soviet Union means the nation is no longer hamstrung by provisions that limited use of defensive technologies. Construction of missile silos for such a system was prohibited under the treaty. President Bush gave Russia six months notice of the withdrawal in December.The defense project’s stated purpose is to defend against the use of a limited number of nuclear missiles by rogue nations such as North Korea, Stevens said, and is designed to eliminate mutual destruction as a strategy.Construction will move ahead on two fronts: The actual missile test bed work by Boeing and its subcontractors, and the general contracting work by Fluor Alaska.The contractors got some symbolic help June 15 from the gathered dignitaries, who donned hard hats, gripped silver shovels, and heaved loads of soil for the official ground-breaking photo.With the brief speeches over, the construction work will begin in earnest. Those who have been working on preparation for the project for months are eager to get busy.-- The Associated Press

Williams to sell all Alaska properties

ANCHORAGE -- Williams Cos. announced June 18 it plans to sell its businesses in Alaska, including the North Pole refinery, a chain of convenience stores, a small stake in the trans-Alaska oil pipeline and its share of the Williams Lynxs Alaska CargoPort.The decision will shed Williams of its Alaska properties, said Jeff Cook, vice president of external affairs for Williams Alaska Petroleum Inc.Williams Alaska Inc. has about 500 employees statewide. It will be up to the new buyer whether or not to keep the employees, Cook said. "At this point it will be business as usual," he said.The Tulsa, Okla.-based company said it also will sell its Memphis, Tenn., refining business. Williams said it had received one unsolicited offer to buy the refining and marketing businesses in Tennessee and Alaska. It declined to name the possible buyer.Williams acquired the North Pole refinery in March 1998 when it bought fellow Tulsa energy company Mapco Inc. The refinery was never part of Williams’ core businesses, Cook said."Obviously these assets are being put up for sale because they are noncore and good performing assets," he said.Williams announced previously that it plans to sell approximately $3 billion in assets as part of an overall plan to improve its balance sheet by $8 billion.A year ago, Williams was earning good profits from long-term contracts managing risks in deregulated power markets. It also had successfully spun off a second telecommunications subsidiary in six years.But now the company is suffering from Enron Corp.’s bankruptcy and federal regulators are questioning its energy trades.In Alaska, Williams said it will sell the North Pole refinery, two petroleum products terminals, 29 convenience stores, a 3 percent stake in the trans-Alaska oil pipeline and its ownership in the CargoPort facility at Ted Stevens Anchorage International Airport.The Alaska refinery has a crude oil processing capacity of 220,000 barrels a day. About 60 percent of production is jet fuel for airlines and the military. The other 40 percent goes to producing other fuels and asphalt.Williams distributes its products through a 20,000-barrel jet fuel terminal at Fairbanks International Airport and a 700,000-barrel terminal at the Port of Anchorage."I think these are good assets. I assume they will be picked up in fairly short order," said Bob King, spokesman for Gov. Tony Knowles.The state will not be involved in what it considers a private business transaction, King said. However, it will be keeping an eye to make sure it doesn’t weaken competition in Alaska.Tesoro Petroleum Corp. of San Antonio, Texas, owns the other main refinery operating in Alaska.

This week in Alaska business history

Editor’s note: "This Week in Alaska Business History" revisits events that shaped our past."Those who cannotremember the past arecondemned to repeat it."-- George Santayana,1863-195220 years ago this weekAnchorage TimesJune 23, 1982State cancels plan for oil lease sale in Norton BasinBy Dave CarpenterTimes WriterA controversial state oil and gas lease sale targeted for the rich salmon and waterfowl breeding area of Norton Basin has been called off in the face of vocal opposition and a lack of interest by the petroleum industry.Natural Resources Commissioner John Katz announced Tuesday that the state is canceling the sale, No. 38, that had been proposed for next January and replacing it with two coal disposals and a sale of geothermal resources.The decision follows more than a year of vehement protest to the proposed sale from western Alaska residents and others. Critics of the sale have been concerned about the risks of industry activity in an area that experiences severe weather and ice conditions, is loaded with fish and is considered one of the world’s most productive waterfowl areas.Anchorage TimesJune 23, 1982Developer purchases 47 acres at Old Seward and DimondBy Dan BrownTimes WriterForty-seven acres of land posed for a major "retail development" on the south side of Dimond Boulevard between the Seward Highway and Old Seward Highway have been sold to a New Jersey land developer for $6.5 million.In acreage, this was the largest sale of commercial property in Anchorage history, according to Sewell Faulkner of Jack White Realty, which headed the partnership that sold the land last Tuesday. The property was sold as three parcels.William Juliano of Medford, N.J. who completed the Northland Business Center at Fairbanks Street and 53rd Avenue in 1979, closed on two of the three parcels Tuesday, and signed an option to buy the third, 17 acres, by late August, Faulkner said.Faulkner could not say exactly what type of development would be built on the site, other than to say it will be a "retail development."10 years ago this weekAlaska Journal of CommerceJune 29, 1992Alaska firms unite to fight AT&T entryBy Ed BennettFor the Alaska Journal of CommerceVirtually the entire telephone industry in Alaska has lined up to fight the proposed $330 million sale of Alascom Inc.’s interstate long-distance services to industry giant AT&T, a deal which opponents fear could eventually cause major increases for the in-state phone rates.Alascom and AT&T announced their proposals late last year and asked that the Federal Communications Commission approve it by Nov. 1. The Alaska Public Utilities Commission has planned its own review by Sept. 8, although that deadline may slip.If approved, the sale would represent the biggest change in Alaska telecommunications since Alaska’s long-distance phone service was transferred from the military to RCA Corp. in 1969.It is far more than a simple sale of assets. It represents a complete reorganization of the way long-distance telephone service is handled within Alaska and between Alaska and the rest of the world. In its filing with the commission, Alascom’s parent company said the sale would promote competition by bringing Alaska’s telecommunications structure in line with the rest of the countryBut just about everyone else in the Alaska telephone business appears highly skeptical of the claim.Alaska Journal of CommerceJune 29, 1992Princess Tours will shift to SewardBy Rose RagsdaleFor the Alaska Journal of CommercePrincess Cruises and Tours, Alaska’s largest cruise ship operator, has announced plans to move its port-of-call to Seward from Whittier next year to cut costs and improve passenger access to Southcentral Alaska.The Seattle-based company also said it would increase capacity in Alaska by 25 percent, transporting up to 3,000 travelers per ship visit through Seward.A top Seward official, who was unaware last week that Princess Cruises has decided to leave Whittier, said his town had tired unsuccessfully to woo the cruise operator for several years.Earlier this year, the city of Whittier approved a disembarkation tax of $3 for every cruise ship passenger who comes ashore in the Prince William Sound community.-- Compiled by Ed Bennett.

Mat-Su rail spur faces opposition

A decade-old study has been dusted off to help define rail and highway corridors to the new port at Point MacKenzie.In 1992, the concept of new transportation links to Point MacKenzie from various parts of the Matanuska Valley drew little support and much protest. Reintroduced recently, the idea is meeting a similar reception. Matanuska-Susitna Borough officials believe a new rail spur from the existing Alaska railroad mainline along with better highway access to Port MacKenzie would pay big dividends through the shipment of and access to coal, timber, gravel and petroleum.But a new transportation corridor across Cook Inlet from Anchorage also would mean a railroad and perhaps a highway near folks who want no such infrastructure. "It’s a NIMBY (not in my back yard) thing," said Jim Swing, the Matanuska-Susitna Borough’s public works director."There is a lot of buildup in the Big Lake area by people concerned about living conditions and recreational use out there."The 10-year-old study focused on several transportation corridors mainly to the east of the Little Su River, between Point MacKenzie and Houston.That area has swelled in population over the last decade and borough officials expect even more opposition from residents there, Swing said.With $400,000 in federal money, the borough has hired Anchorage-based engineering firm Tryck Nyman Hayes to restudy the transportation routes. The amended study identifying a preferred route is slated for completion in February.Swing said the route being looked at with greater interest now is a rail spur on the west side of the Little Su River that would link in with Alaska Railroad Corp.’s mainline near Willow."There are a lot less people on the west side of the Little Su," Swing said. "It would actually go through virgin ground."Port MacKenzie opened last spring for limited operations. Some 4.4 million pounds of cargo were exported during the 2001 summer shipping season, including more than 40 homes built by Alaska Manufacturing Contractors, the first and only tenant to operate at the port. The construction of the homes built at Point MacKenzie and shipped to the Bush generated some $8 million in gross revenues, the same amount it cost to build the facility, said Marc Van Dongen, Port MacKenzie port director.Van Dongen said transportation access to the port, especially rail, would help provide a sustained and strong economy for the Mat-Su borough, currently the fastest growing region in the state with an annual growth rate of more than 3 percent.The new transportation corridor would also open up land in the Matanuska Valley for development, he said.Van Dongen points out that Rep. Don Young, R-Alaska, chairman of the powerful Transportation and Infrastructure Committee, is committed to funding a road and rail bridge between Anchorage and Point MacKenzie, a project that has a price tag of more than $1 billion, according to some estimates."That’s not a lot of money or a big project on a national scale," Van Dongen said.The Knik Arm crossing linked with a rail spur to the Alaska Railroad’s mainline, 33 miles away to Houston or 40 miles to Willow, has too many benefits to ignore, including lessening train traffic in Wasilla, Palmer, Eagle River, Elmendorf Air Force Base and north Anchorage, Van Dongen said."It would get the railroad out of several communities and provide a more direct, shorter line to Fairbanks," Van Dongen said.The route would save the Alaska Railroad 24 miles one-way in its fuel-shipping operations between North Pole and Anchorage, Van Dongen said."It will save them time and money having faster trains," Van Dongen said.The railroad has not taken a position on any additional rail spur being considered by Mat-Su borough officials, said Patrick Flynn, Alaska Railroad spokesman.A new highway from the port also would lessen traffic on the Glenn Highway, already the busiest in the state where more than 8,000 people commute daily between the Mat-Su area and Anchorage, according to state statistics."It would be quicker and cheaper for truckers, and safer for commuters," Van Dongen said. Van Dongen said he understands the opposition from people in the Big Lake, Willow and Houston areas who don’t want increased vehicle traffic or a railroad running nearby."I don’t blame them," Van Dongen said.But he said with Anchorage starved for land, it’s inevitable new road and rail will be built someday, kind of a manifest destiny for the Matanuska-Susitna area."Maybe it will take 10 years, maybe 30 years," Van Dongen said of rail and highway corridors to the new port at Point MacKenzie. "But I’ll bet anything it’s going to happen and we need to be planning for it."

Gas-to-liquids plant almost ready

Scientists from around the world will soon plug into the Internet to test new natural gas technologies in the $86 million gas-to-liquids test plant built in Nikiski, near Kenai.The plant, built by BP Exploration (Alaska) Inc., is essentially complete and is in the process of being started.It is a commercial demonstration unit to test a new compact reformer unit that BP developed, according to Shane O’Leary, BP’s former manager for the project. The reformer is the first stage of the plant, which converts natural gas into a liquid product.With technology used today the former is the most costly part of a gas-to-liquids plant. If BP is successful in testing its smaller, less-costly reformer, the cost of producing liquids from gas will be reduced.With the plant complete, O’Leary has been transferred to another job in BP. Len Seymour has taken over management of the project at BP.One aspect of the plant is its automation and advanced instrumentation. Scientists in London, Houston or anywhere in the world will be able to conduct experiments in the plant using the Internet for data transfer through the use of "DataLink," a new software system.If proven feasible commercially, the technology promises to reduce the costs of full-scale gas-to-liquids plants that could be developed anywhere in the world, including Alaska, O’Leary said.Gas-to-liquids plants operate in South Africa and commercial-scale plants are planned in Nigeria and Qatar, but technology advances are needed to lower costs enough for such plants to be built in Alaska or elsewhere.Davie Process Technologies, BP’s partner in the research, will license the gas-to-liquids technology to others once the demonstration is complete.BP’s plan is to operate the Kenai test plant for five years, but there are indications that other uses for the facility will be found. It is being built as a "test-bed" so that other natural gas conversion technologies and products can be tested in the unit.O’Leary said BP has been approached by other companies interested in using the plant for research. BP itself is working on other advances in gas-to-liquids which can be used in the plant, he said.BP conducts similar remote real-time monitoring of production facilities, such as offshore platforms, but this is the first time it will be done with a research facility.The plant can operate with two operators per shift, although maintenance and other support staff will be employed, for a total of 20 on the project.Austin International, a Texas-based company, is managing construction of the plant, while Udelhoven Oil Field Services of Alaska installed instrumentation.While the test plant is too small to be converted to a commercial-scale gas-to-liquids plant, the facility does focus attention on Alaska as a location for such a plant.Exxon Mobil Corp., a major owner of gas reserves on the North Slope, has studied construction of a 50,000 barrels per day gas-to-liquids plant there using its own technology. BP believes gas-to-liquids is a serious option for commercialization of North Slope gas, although a conventional gas pipeline is the best option, O’Leary said.Other companies are considering a smaller, 12,000 barrels per day gas-to-liquids plant in Kenai, built separately from the BP test plant.The plant could share support infrastructure with the existing Tesoro refinery and Agrium Corp. fertilizer plant. It would supply high-quality, sulfur-free diesel fuel and other premium products to the West Coast, according to Richard Peterson, president of ANGTL Inc., a company that has performed gas-to-liquids studies in Alaska.

Agency extends Ketchikan shipyard lease, plans transfer

Alaska Ship and Drydock Inc. has gotten the nod from the Alaska Industrial Development and Export Authority to continue operating a shipyard owned by the authority in Ketchikan, despite a competing proposal from an Oregon-based company.AIDEA is in the process of transferring ownership of the shipyard to either the Ketchikan Gateway Borough or the City of Ketchikan. At its June 13 meeting, the mayors of both governments were strongly supportive of Alaska Ship.AIDEA extended Alaska Ship’s lease for three months. It was due to expire July 15. That will provide enough time for the ownership transfer to take place; the new owner will then negotiate a much longer lease with Alaska Ship.Alaska Ship took over operation of the shipyard in 1994 after two previous private operators failed. In the eight years Alaska Ship and Drydock has managed the yard, revenues from repairing large and small vessels have reached $20 million per year, according to Doug Ward, the company’s marketing manager.AIDEA was considering an extension of the company’s lease, but also considered putting out a request for pjroposals for a new shipyard operator. This attracted the attention of Shipyard America, an Oregon-based company.At the June 13 meeting, however, the two mayors spoke in favor of Alaska Ship. Both municipal governments intend to contribute matching funds or land, to a possible $5 million federal grant that would add a ship-lift facility to the yard.Ward told the AIDEA board June 13 that the company has demonstrated that it can perform well despite limited facilities at the yard, and that it should be given a longer lease on the yard to attract new private investment.Alaska Ship has invested $3 million of its own funds in taking over the yard and buying equipment, and another $700,000 in marketing, Ward said.The yard was built by the state in the 1980s mainly to serve the state ferry system.

Closure of Kenai king salmon fishery 'devastating' to businesses

KENAI -- Rick Giannini of Liverpool, N.Y., traveled to the Kenai Peninsula with friends to celebrate their respective 50th birthdays by catching Kenai River kings.Much to their dismay, they found that Kenai kings were no longer on the menu."We went into the gas station to buy our (king) salmon stamps, and we saw the headline in the newspaper," Giannini said June 11.Giannini’s disappointment mirrored the reaction of many in the peninsula’s tourism industry, as well as other visitors."We’ve been planning this trip for six months," he said.Although there are some who are optimistic the peninsula will survive the closing of the Kenai to early run king salmon fishing, many others feel it has pulled the plug on the beginning of an already shaky tourism season."It’s going to be a pretty devastating effect," said guide Tim Berg, who owns Alaskan Fishing Adventures in Soldotna. "What’s happened in the past, people think the whole Kenai Peninsula is closed. So we don’t get the tourists from Outside. People don’t come down for halibut fishing, as well."Berg, who has been guiding for 15 years, said there are alternatives to fishing the Kenai River, but "the Kenai is still the No. 1 draw on the whole peninsula."The Alaska Department of Fish and Game announced June 10 the Kenai River would be closed to fishing for chinooks because of a weak run, the second lowest on record.Because the Central Peninsula’s economy depends so heavily on sportfishing during the summer months, there could be some backlash to 20 days without king fishing, said Brett Huber, executive director of the Kenai River Sportfishing Association."Seventy percent of all sportfishing in Alaska is in Southcentral," he said, referring to Alaska Department of Fish and Game numbers, "and 70 percent of sportfishing in Southcentral is on the Kenai."What you’re going to see are campgrounds that don’t have people. You’re going to see it at grocery stores, hotels and gas stations. I don’t think any sector of our economy is sheltered from this."Bill Wirin owns the Salmon Haus Bed and Breakfast in Soldotna. He said he doesn’t anticipate any additional guests for the remainder of June because of the river closing."Many times in June, people decide at the last minute to come from Anchorage," he said. "I think we’ll see people going other places on the peninsula, but not coming to Soldotna. It certainly will mean we won’t pick up any drop-in guests."Ken Lacy, owner of Ken’s Alaska Tackle in Soldotna, runs a fishing guide business along with his store on the Sterling Highway. He said as of June 11 he had refunded $3,100 for fishing tours, and he expects more. Although he was prepared for the possible financial hit a Kenai River closure could take on his guide business, Lacy said he is more concerned about the revenue in the store."I’m down about 60 percent in sales today," he said. "There was a massive drop in license sales, king tag sales and tackle sales. Normally today, I should have sold 60 licenses. I only did 14."Although fishermen are displeased with the closing, they acknowledge the importance of preserving the resource. Huber said in spite of the downside, he is accepting of no Kenai River king fishing."We’re disappointed that the run is so poor, but we also support the closure," he said.Joe Connors, president of the Kenai River Professional Guide Association, concurred."If these numbers are correct, we’ve got to protect the resource," he said.Connors and Lacy said there could be broader impacts from the closing of the kings, however. Connors said the closing will equate to missed business with tourists from Outside."These people are going to go away, and they’re not going to come back," he said.Lacy said history shows things have been getting worse over the years. He said lagging revenue in his store could mean a cut in hours for some or all of his six staffers."Every year that I’ve seen this happen, we lose more and more tourists," he said. "I used to write 12,000 licenses. Last year I wrote 7,900, and it’s getting worse."If it doesn’t pick up in a couple of days, I’ll have to either cut two employees’ hours back or lay two off."One of Giannini’s traveling companions, Rich Strohl, of Albany, N.Y., said his party was lured to the river by lore that reached them in the Lower 48. But they may not come back if there are better places to hook the big ones.


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