September - 2013 - Alaska Business Monthly by Alaska Business

Alaska Native Corporations Review â&#x2013; Guide to Alaska Natural Gas Projects

September 2013

Alaska Native Regional Corporations An economic powerhouse for Alaska Page 92

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September 2013 TA BLE OF CONTENTS

ABOUT THE COVER

DEPARTMENTS

CIRI President and CEO Sophie Minich in her ofﬁce. The September issue celebrates Alaska Native Corporations and their contributions to the Alaska economy. The annual special section begins on page 92.

From the Editor. . . . . . . . . . . . . . . . . . . . . . . . . 7 Inside Alaska Business . . . . . . . . . . . . . . . . . 8 Agenda . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48 Right Moves . . . . . . . . . . . . . . . . . . . . . . . . . 134 Alaska This Month . . . . . . . . . . . . . . . . . . 136 Events Calendar . . . . . . . . . . . . . . . . . . . . . 139 Market Squares . . . . . . . . . . . . . . . . . . . . . 140 Alaska Trends. . . . . . . . . . . . . . . . . . . . . . . . 143 Ad Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146

Cover photo © Chris Arend Photography.

ARTICLES

VIEW FROM THE TOP

Petty Officer 2nd Class Alex Luna, Chief Warrant Officer 2 Danny Kilburger, Lt. j.g. Nicole Bredariol and Petty Officer 2nd Class Jesse Kassbaum, crewmembers of the Coast Guard Cutter Bertholf, teach students at Alak School in Wainwright, Alaska, about boating safety and how to properly wear their lifevests in September 2012.

FINANCIAL SERVICES

HR MATTERS

The Chaninik Wind Group and Intelligent Energy Systems built a series of smart grids designed to integrate cheaper wind power into their energy systems and these utilize TERRA Southwest to help reduce diesel use by half in some villages.

ENERGY

20 | Great Alaska Energy Challenge Turning simple fixes into savings By Zaz Hollander

CONSTRUCTION

24 | High End Homes Upscale and customized By Gail West

14 | Mobile Commerce Expanding in Alaska New options for smartphone and tablet users By Tracy Barbour 4

34 | Alaska Native Leadership Melding a rich past to a bright future By Kevin M. Dee

©GCI

12 | Michelle Sparck, President ArXotica Compiled by Mari Gallion

U.S. Coast Guard photo

MILITARY

28 | Coast Guard’s Arctic agenda heats up By Zaz Hollander

Alaska Business Monthly | September 2013

TELECOM & TECHNOLOGY

36 | How Terrestrial Broadband is Forever Changing Telecommunications in the Arctic By Bob Walsh

MINING

42 | Elephant-Load Trucks The machines that mine Alaska By Julie Stricker

OIL & GAS

50 | Cook Inlet exploration is busy Buccaneer, Furie test new gas discoveries By Mike Bradner

OIL & GAS

56 | The Mid-Majors These oil companies, big but not giant, are making strides in Alaska By Wesley Loy

OIL, GAS & FISCAL POLICY 62 | The Alaska OCS and State Fiscal Policy By Bradford G. Keithley

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September 2013 TA BLE OF CONTENTS ARTICLES

special section

OIL & GAS

Alaska Native Corporations

64 | Don’t Miss the Alaska Oil & Gas Congress Event offers a wealth of timely information Compiled by Tasha Anderson

OIL & GAS

66 | Guide to Alaska Natural Gas Projects By Bill White

TRANSPORTATION

76 | Arctic Shipping Changing routes, rules, and communities By Nicole A. Bonham Colby

TRANSPORTATION OP-ED

85 | Alaska Native Brotherhood Joins Renewable Fuel Standard Reform Group By Bob Loescher

HEALTH & MEDICINE

AFHCAN telemedicine cart.

86 | Telemedicine Saves Dollars and Makes Sense for Alaskans By Susan Sommer

Corrections In the August article Alaska’s College Savings Program: A jewel in the crown of the University of Alaska by James F. Lynch and Ashok K. Roy, due to an editorial error the number of Alaskans participating in the program was incorrectly stated as thirteen— there are thirteen thousand Alaskans participating in the program through the PFD Check-Off. 6

Photo courtesy of ASRC

ASRC Communications Director Ty Hardt at the summit of Mount Everest, which he climbed to raise money for the Boys & Girls Club of Barrow.

92 | Alaska Native Regional Corporations An economic powerhouse for Alaska By Julie Stricker

Photo by Susan Sommer

122

100 | Village Corporation Overview Finding creative ways to use assets and benefit shareholders Compiled by Mari Gallion 104 | The Continuing Evolution of Arctic Policy The state is slow to catch up with the world By Shehla Anjum 108 | Alaska Native Aviators Education and job opportunities for Rural Alaskan pilots By Mari Gallion 111 | Alaska Humanities Forum’s Rose Urban Rural Exchange Connecting communities, building crosscultural ambassadors By Laurie Evans-Dinneen 114 | Seashares An Alaska rural development program flourishes, though not without controversy By Wesley Loy

Alaska Business Monthly | September 2013

108

Photo courtesy of Yuut Yaqungviat, LLC

Yuut Yaqungviat graduate Tristen Carl with ﬂight examiner Bruce Perry.

118 | Making Leaders How a straight line and a winding road can lead to the same place By Mari Gallion 122 | Top of the World Mount Everest climb raises money for the Barrow Boys & Girls Club By Ty Hardt 125 | 2013 Alaska Native Regional Corporations Directory 130 | 2013 Alaska Native Village Corporations Directory

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FROM THE EDITOR Follow us on and

Volume 29, Number 9 Published by Alaska Business Publishing Co. Anchorage, Alaska Vern C. McCorkle, Publisher 1991~2009

EDITORIAL STAFF

Managing Editor Associate Editor Editorial Assistant Art Director Art Production Photo Consultant Photo Contributor

Susan Harrington Mari Gallion Tasha Anderson David Geiger Linda Shogren Chris Arend Judy Patrick

BUSINESS STAFF

President VP Sales & Mktg. Senior Account Mgr. Account Mgr. Survey Administrator Accountant & Circulation

Jim Martin Charles Bell Anne Campbell Bill Morris Tasha Anderson Melinda Schwab

501 W. Northern Lights Boulevard, Suite 100 Anchorage, Alaska 99503-2577 (907) 276-4373 Outside Anchorage: 1-800-770-4373 Fax: (907) 279-2900 www.akbizmag.com Editorial email: editor@akbizmag.com Advertising email: materials@akbizmag.com Pacific Northwest Advertising Sales 1-800-770-4373 ALASKA BUSINESS PUBLISHING CO., INC. ALASKA BUSINESS MONTHLY (ISSN 8756-4092) is published monthly by Alaska Business Publishing Co., Inc., 501 W. Northern Lights Boulevard, Suite 100, Anchorage, Alaska 99503-2577; Telephone: (907) 276-4373; Fax: (907) 279-2900, ©2013, Alaska Business Publishing Co. All rights reserved. Subscription Rates: $39.95 a year. Single issues of the Power List are $15 each. Single issues of Alaska Business Monthly are $3.95 each; $4.95 for October, and back issues are $5 each. Send subscription orders and address changes to the Circulation Department, Alaska Business Monthly, PO Box 241288, Anchorage, AK 99524. Please supply both old and new addresses and allow six weeks for change, or update online at www.akbizmag.com. Manuscripts: Send query letter to the Editor. Alaska Business Monthly is not responsible for unsolicited materials. Photocopies: Where necessary, permission is granted by the copyright owner for libraries and others registered with Copyright Clearance Center to photocopy any article herein for $1.35 per copy. Send payments to CCC, 27 Congress Street, Salem, MA 01970. Copying done for other than personal or internal reference use without the expressed permission of Alaska Business Publishing Co., Inc. is prohibited. Address requests for specific permission to Managing Editor, Alaska Business Publishing. Online: Alaska Business Monthly is available at www.akbizmag.com/archives, www. thefreelibrary.com/Alaska+Business+Monthly-p2643 and from Thomson Gale. Microfi lm: Alaska Business Monthly is available on microfi lm from University Microfi lms International, 300 North Zeeb Rd., Ann Arbor, MI 48106.

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The Joy of School Showing up every day

he kids went back to school in August. I looked forward to the blessed event beginning in early June, a couple of weeks after school let out for the summer. Finally, I am back on schedule and, with one kid in junior high and one kid in high school, I can just imagine the fun they are going to have and all the wonderful things they are going to learn. I am really excited this year as I am fully expecting they both will have perfect attendance thanks to School Business Partnerships (SBP) with the Anchorage School District. When high school kids registered in August there was a brand spanking new Jeep Patriot parked in front of each school to build excitement for a new SBP program—aptly called Drive and Fly for Perfect Attendance and sponsored primarily by Lithia Chrysler Jeep Dodge of South Anchorage and GCI, two of the more than six hundred SBP partners that help Anchorage schools. Automatic Entry—Attend Every Day High school juniors and seniors are automatically entered to win a 2013 Jeep Patriot or two round trip airline tickets (one Jeep winner, four winners of two round trip tickets each) if they attend school every day. Grades nine through twelve are also automatically entered to win one round trip airline ticket that will be awarded at the end of each of the ﬁrst three quarters—if students have perfect attendance. A third level of prizes will be awarded next May to every qualifying high school student with 95 percent attendance for the full school year, and those prizes are compliments of SBP partners Lithia, GCI, Alaska Aces, and Pizza Hut. Elementary School Incentives SBP partner Alaska IBEW Local 1547 is sponsoring trips to Disneyland and an Apple computer for students attending elementary schools in Anchorage if they have no unexcused absences for the full school year. This is all part of the Anchorage School District’s goal of having 90 percent perfect attendance by 2020. Rates and Goals Last year, attendance by high school seniors was actually up 2.4 percent over the year before though still dismal at 57.8 percent. Sixth graders had the best attendance rate at 82.8 percent. There was quite a range overall and attendance rates drop sharply after sixth grade. Learn more at asdk12.org/parents/attendance and get the complete contest terms and conditions. Show Up Every Day Throughout life attendance is important. As we teach our children how to be good people, one thing that is so important is to show up every day. Drive and Fly for Perfect Attendance is a great incentive to get kids into that habit. Showing up every day is a transferable skill that will lead to success in the journey from the school house to the business world. Speaking of showing up, the team at Alaska Business Monthly sure did! We’ve put together another really great magazine. Enjoy! —Susan Harrington, Managing Editor September 2013 | Alaska Business Monthly

INSIDE ALASKA BUSINESS

BDO USA, LLP

DO USA, LLP, one of the nation’s leading professional service organizations, announces an expansion into Alaska through the addition of more than one hundred staff, including six partners, from Anchorage-based Mikunda, Cottrell & Co. The combination of BDO and Mikunda, Cottrell & Co. was made effective July 1. Mikunda, Cottrell & Co. has been recognized by numerous business and industry publications for its rapid growth and workplace accomplishments. It has been named one of the Best of the Best managed firms by Inside Public Accounting, a Best Accounting Firm to Work For by Accounting Today and Best Companies Group, and “Small Business of the Year” by the Alaska State Chamber of Commerce. BDO USA, LLP is a US professional services firm providing assurance, tax, financial advisory, and consulting services to a wide range of publicly traded and privately held companies. For more than one hundred years, BDO has provided quality service through the active involvement of experienced and committed professionals.

ASRC Federal Space and Defense

ASA Goddard Space Flight Center has selected ASRC Federal Space and Defense as prime contractor on the Electrical Systems Engineering Services II contract. The five-year contract has a maximum value of $475 million. ASRC Federal Space and Defense will provide electrical systems engineering support services and related work for instrument and spacecraft programs.

Compiled by Mari Gallion

Support will include systems engineering; study, design, development, fabrication, integration, testing, verification and operations of spaceflight; and airborne and ground system hardware and software. ASRC Federal Space and Defense will also support development and validation of new technologies to enable future space and science missions. NASA missions and projects supported under the ESES II contract include Global Precipitation Measurement, Magnetospheric MultiScale, Landsat Data Continuity, James Webb Space Telescope, Soil Moisture ActivePassive, Soft X-Ray Spectrometer for ASTRO-H, and the Advanced Topographic Laser Altimeter System. Work will be performed at Goddard Space Flight Center in Greenbelt, Maryland, the ASRC Federal Space and Defense team’s offsite facilities, and other NASA locations.

Alyeska Resort

ine Spectator Magazine recently named Seven Glaciers Restaurant at Alyeska Resort one of its winners of the 2013 Best of Award of Excellence Honor. The Wine Spectator’s Restaurant Wine List Awards program has remained the pinnacle of recognition in the fine-dining industry. The restaurant wine list award program has three distinct levels: Award of Excellence, Best of Award of Excellence, and Grand Award with 2,870, 850 and 73 winners in each level respectively for 2013. Each level follows select qualifications utilized by a multi-judge panel and the criteria range from quantitative measurements such as number of wine selections to depth, range, and

display of the list. Seven Glaciers joins Marx Bros. Café, Lavelle’s Bistro, and The Crow’s Nest as Alaska’s only restaurants to receive this recognition.

Dawley & Associates

awley & Associates, a Seattle-based web development, strategy, and marketing firm, announces opening an Anchorage office. Dawley & Associates has been in business in Seattle since 2004, and has serviced clients in Alaska throughout its history. The new Anchorage office will offer Alaska clients a local contact. The company’s Alaska clients include the Alaska Marine Highway System; the State of Alaska’s domestic travel website, TravelAlaska.com; the Anchorage Museum at Rasmuson Center; the Ketchikan Visitors Bureau; and several flight-service providers and lodges. The company has also worked with Alaska Native corporations. Dawley & Associates provides Internet strategy services focused on helping businesses plan complex web and app development and marketing efforts. The company has technical staff able to create attractive, easy-to-use resources that are scalable and reliable. Additionally, the team has the skills to market these products online to make the whole process a success. The new office is located at 405 E. Fireweed Lane.

William Jack Hernandez Sport Fish Hatchery

he Institute of Sustainable Infrastructure announces that the first completed project assessed using its new Envision sustainable infrastructure rating system

Your Project, Our Responsibility. 24/7 Service Pacific Pile & Marine has a robust fleet of marine equipment including our recent addition of a 600-Ton 4600 Ringer.

www.pacificpile.com I (907) 276-3878 276-3873 8

Alaska Business Monthly | September 2013

From critical lifts to platform support, PPM is sufficiently resourced to deliver a wide range of construction services. 620B East Whitney Road I Anchorage, AK 99501 www.akbizmag.com

INSIDE ALASKA BUSINESS is the William Jack Hernandez Sport Fish Hatchery in Anchorage. The HDRdesigned project received an EnvisionTM Gold award, which was announced at a reception event in Washington, DC, and a day earlier onsite at an event in Anchorage. The 141,000-square-foot hatchery facility is the largest indoor sport fish hatchery in North America and contains many sustainable features, including sophisticated recirculation technology that greatly reduces the environmental impact of the hatchery by leaving the brownfield site cleaner than before, saving water and energy, keeping Ship Creek clean, and building public education into its design. Additional higher levels of achievement were concentrated in several Envision structure credit categories, including the following: Leadership Category—Pursued by-product synergy: The project formed a partnership to transfer waste from the operations of the facility as input to another facility and evaluated the potential to make use of warm water from a neighboring industry. Leadership Category—Improved infrastructure integration: The project repurposed existing water and sewer infrastructure. Quality of Life—Improved the net quality of life of all communities affected by the project and mitigated community impacts. Resource Allocation—Reduced energy use: The project piloted and later implemented a full scale, highly efficient, recirculated aquaculture system that reduced the energy needed by approximately 88 percent. Natural World—Preserved greenfields and reduced pesticide and fertilizer impacts: The project team designed the landscaping to incorporate native plant species suitable to the Alaskan climate, requiring no pesticides, herbicides, or ongoing fertilizers.

Compiled by Mari Gallion

Sealaska Heritage Institute

ealaska Heritage Institute (SHI) has hired longtime contractor Dawson Construction, Inc., to build the Walter Soboleff Center in Juneau. Dawson, founded forty-five years ago, has completed more than thirty projects in Juneau and worked on multiple cultural centers in Southeast Alaska. Dawson also has worked with MRV Architects, which designed the Walter Soboleff Center, and has an office in Juneau. All of the bids were very competitive and in-line with SHI’s previous estimates, which put the total cost of the building at around $20 million. By July, SHI had raised more than 75 percent of the funds and will continue to raise the remaining funds during construction. SHI has received support from the Alaska Native Education Program, ArtPlace, City and Borough of Juneau, Cruise Industry Charitable Foundation, Juneau Lion’s Club, M.J. Murdock Charitable Trust, Rasmuson Foundation, Sealaska, State of Alaska, Walter Soboleff Trust, and numerous individuals and businesses. The center is named for the late Dr. Walter Soboleff, an influential Tlingit leader and former Chair of SHI’s board of trustees. The Center will feature space for art demonstrations and exhibits, retail sales, a learning center for educational programs, and venues for performances and presentations. It will also house a research facility, climate-controlled collections storage, and a library and work areas for scholars and the general public. SHI was founded in 1980 to promote cultural diversity and cross-cultural understanding. The institute is gov-

erned by a board of trustees and guided by a council of traditional scholars. Its mission is to perpetuate and enhance Tlingit, Haida, and Tsimshian cultures of Southeast Alaska.

University of Alaska Anchorage

he University of Alaska Anchorage launched its second startup company, CFT Solutions, an innovative approach to deicing and snow removal. CFT Solutions, a Seawolf Holdings company, was founded on the idea of creating an innovative, cost-effective, and environmentally friendly approach to prevent snow and ice from accumulating. CFT’s patent-pending innovation is in embedding carbon fiber tapes under the pavement to heat the surface. The tapes are easy to install and maintain. This system is ideal for high pedestrian traffic walkways, roads, high usage road intersections, bridges, and roofs of buildings, as well as domestically for driveways and home roofs. It was successfully tested in Anchorage during the winter of 2011-12, which had a record snowfall for the area. The company, created in May, was established by UAA Vice Provost for Research and Graduate Studies Dr. Helena Wisniewski and faculty inventor Zhaohui “Joey” Yang, a University of Alaska Anchorage engineering professor.

B House Publishing

House Publishing is excited to announce Be Wed, Alaska’s newest wedding magazine. Be Wed was founded to showcase the exceptionally unique and modern elegance of weddings in Alaska.

Your Project, Our Responsibility. 24/7 Service

Pacific Pile & Marine has a robust fleet of marine equipment including our recent addition of a 600-Ton 4600 Ringer.

www.pacificpile.com I (907) 276-3878 276-3873 www.akbizmag.com

From critical lifts to platform support, PPM is sufficiently resourced to deliver a wide range of construction services. 620B East Whitney Road I Anchorage, AK 99501 September 2013 | Alaska Business Monthly

INSIDE ALASKA BUSINESS Be Wed is a semi-annual magazine published by B House Publishing, LLC, a partnership between Jessica Steele and Camille Friend. Steele serves as the editor in chief of the magazine, while Friend serves as the creative director.

North Wind, Inc.

orth Wind, Inc. and North Wind Services, LLC have moved to a new Anchorage location: 2627 C Street, Suite 130, closer to parent company Cook Inlet Region, Inc., providing easier access for collaboration and partnering with CIRI.

N C Machinery

C Machinery announces the opening of a new 55,000-square-foot facility in Fairbanks. Located at 801 Van Horn Road, the new full-service facility features fifteen service repair bays and a 16,500-square-foot parts warehouse. “We take providing industry-leading support to our Fairbanks-area customers very seriously, and our new facility is an important investment in our long-term, continued commitment to the region,” says Don Linn, Vice President of Service. “With approximately sixteen thousand parts line items, dedicated welding and machining areas, on-highway truck service, cylinder repair/honing, hose building/rebuilding, and an unrivaled team of support personnel, we look forward to successfully partnering with our customers now and for years to come,” adds John W. Harnish, Vice President of Parts. “We support an incredibly diverse group of customers and industries in the interior of Alaska, including mining, road construction, general construction, and governmental entities. For

Compiled by Mari Gallion

all of these industries, this impressive new facility significantly advances our stated mission of helping our customers succeed,” concluded Troy Hickey, Vice President of Sales and Marketing. N C hosted a Fairbanks Grand Opening event at their new facility July 31. N C Machinery is the authorized Caterpillar Dealer for Alaska. Operating under the names N C Machinery, N C Power Systems, and N C The Cat Rental Store, N C offers Caterpillar and other preferred brand equipment and power systems sales, parts, service, and rentals for customers in the construction, mining, petroleum, governmental, marine, electric power, on-highway, forestry, and industrial markets. N C operates facilities in Anchorage, Dutch Harbor, Fairbanks, Juneau, Prudhoe Bay, and Wasilla.

Anchorage Parks

rctic Benson Park at 750 West Thirty-First Avenue in Anchorage now features a new fenced dog park as part of a neighborhood effort to transform the park into a safe and healthy place. In 2011, over fift y neighbors and volunteers filled out report cards critiquing Arctic Benson Park, cumulatively giving it an F. Thanks to a dedicated committee formed to identify needed park improvements, the Anchorage Park Foundation successfully secured $83,000 from the Alaska State Legislature to improve Arctic Benson Park in the summer of 2013. Organizer Karen Dechman has been devoted to this project for two years. “This is a very big deal for dog owners, especially our disabled veterans and elderly who struggle with finding a place to exercise their beloved dogs. But

Dechman believes that the improvement will also affect those without pets. “It is also a great way for people who might have few other opportunities to connect with their community, to meet neighbors and make friends.” The Alaska State Legislature, Rasmuson Foundation, and the Anchorage Park Foundation worked together to raise the funding for this project, which was implemented by the Anchorage Parks & Recreation Department. Thanks also to SPCA, Access Alaska, Midtown Community Council, REI, Wells Fargo, ML&P, AWWU, and all the individuals who generously gave of their time to promote this popular project.

USKH, Inc.

SKH, Inc. is the sixth highest rated Multidiscipline Architecture/ Engineering Firm to Work For in the country. Awards were announced at the Best Firms to Work For conference in Chicago, sponsored by ZweigWhite. Rankings were made based on the results of a comprehensive survey of workplace practices and an independent survey of employees. To qualify for the multidiscipline award, firms provide a minimum of two disciplines. USKH, Inc., an employee-owned firm that has been in business for more than forty years, offers architecture; civil, structural, mechanical, electrical, and environmental engineering; planning; landscape architecture; and surveying. USKH, Inc. was the highest-ranked Alaska-based firm in any of five categories (multidiscipline, architecture, civil engineering, structural engineering, and environmental). 

• General Contracting • Marine Infrastructure • Design Build

Dutch Harbor - Unalaska, Alaska

www.pacificpile.com I (907) 276-3873 10

Alaska Business Monthly | September 2013

620B East Whitney Road I Anchorage, AK 99501 www.akbizmag.com

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View from the Top

Compiled by Mari Gallion

Michelle Sparck, President

riplets Michelle, Amy, and Cika Sparck grew up in the Yukon Kuskokwim Delta, going to school in Bethel and spending holidays and summers in their mother’s village of Chevak. Members of the Qissunamiut Tribe, the children of a Cup’ik educator with the University of Alaska and a Jewish natural resources advocate, the sisters developed a keen sense of appreciation for the cultural and educational opportunities and security they were afforded. In 2006, they used their combined talents and educations to form ArXotica, a high-end skin care product line based on Arctic botanicals. TRADITIONAL EDUCATION: We grew up as gatherers, picking plants and berries for homeopathic use and sustenance. Our elders, aunties, and uncles would teach us what, where, and when to pick certain greens and fruits, filling a seeming nutrition gap that a high wild protein diet would yield, typical of Alaska residents far from the road system. We knew this stuff was good for you; traditional ecological knowledge and empirical use proved it. SOMETHING GOOD ABOUT IT: I remember once I was very sick with a horrible cold and maybe even flu-like symptoms. My throat was on fire, I couldn’t swallow, and my lungs felt filled with fluid. One of my Aunts told me to drink this green fluid from this bottle, and the way my memory serves me, it cured every symptom as it passed through my mouth down to my stomach. I was better. That was a very powerful memory of ciagg’luk, which in our language means, “nothing bad about it.” It is Arctic Sage, better known as wormwood, and it went on to become one of our signature ingredients. We felt if our high North latitude flora is so good for you nutritionally or medicinally, then wouldn’t it make sense to use them for effective anti-aging skin care? HONORING THE SOURCE: One of the hallmarks of ArXotica is our pledge of 100 percent resource utility, meaning that 12

Alaska Business Monthly | September 2013

ArXotica

no inputs should go to waste. We strive to achieve zero waste by utilizing the leftover material from value-added processing in the use of other products. Out of one harvest, many products are made. SKIN STAYCATION: We are from a breathtaking and romantic place and can personally attest to the virtue and integrity of our ingredients. We are purpose driven and inspired to be agents of positive change. Our products are divine; you only need to touch our serum or our soaps to your skin and you are transported to an ancient land and time—it’s like a staycation for your skin! If you can’t ever get to Alaska, at least we bring its best to you. HANDS-ON BUSINESS: We source our own materials; not too many companies do this. If we aren’t stooped over in the tundra doing it ourselves, we offer fair trade and compensate volunteers helping us out. Our botanicals are off-the-charts in antioxidant content, and the naturally ionized glacier water and extra-virgin salmon oil make for a formidable antiaging concoction. Many “shop local” foodies can brag about their organic diet, but that’s for their internal health. What about your body’s largest organ—the epidermis? ArXotica’s products are Arctic superfood nutrition for your skin: designer skin-ware with a twist.  www.akbizmag.com

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© 2013 AT&T Intellectual Property. All rights reserved. AT&T, the AT&T logo and all other AT&T marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners. This document is not an offer, commitment, representation or warranty by AT&T and is subject to change.

FINANCIAL SERVICES

Mobile Commerce Expanding in Alaska New options for smartphone and tablet users By Tracy Barbour

Photo courtesy of Northrim Bank

s the adoption of mobile devices continues to explode, Alaska businesses are facilitating more services for consumers who use smartphone and tablet computers. Financial institutions are branching out beyond online banking to offer mobile banking, text banking, and mobile check deposits. Various organizations are optimizing websites to give mobile users better access to information about products and services. Retailers are increasingly using mobile credit card processing options for on-site and off-site transactions. As of May, 56 percent of American adults owned a smartphone and 34 percent owned a tablet computer, according to Pew Research Center, a nonprofit “fact tank” that provides information on the issues, attitudes, and trends shaping America and the world. The proliferation of smartphones and tablets is driving an increase in mobile commerce, which involves using mobile devices for everything from making online purchases and reservations to researching information about different products and services. The gravitation toward mobile devices and mobile commerce is also playing out in Alaska, according to Mark Mathis, a senior account executive with Anchorage-based Arctic Information Technology. “More people are looking to do more with their mobile devices,”

Sara Green, the owner of Sara’s Gift Cache, using a mobile credit card payment processing solution with her tablet.

he says. “It’s only going to grow exponentially in the future.” Alaska’s financial institutions are using mobile websites and apps to provide a range of services that consumers can access through smartphones, tablets, and other mobile devices.

Alaska Business Monthly | September 2013

Alaska USA Alaska USA Federal Credit Union is a prime example. As technology and member preferences have changed, it has adapted to meet the needs of its members, according to Executive Director of Retail Financial Services Brian Wolf. www.akbizmag.com

“More people are looking to do more with their mobile devices. It’s only going to grow exponentially in the future.” —Mark Mathis Senior Account Executive Arctic Information Technology

The credit union developed a mobile site in the third quarter of 2007, a mobile account access app in mid-2011, and a check deposit app by the end of 2012. “Alaska USA has provided service, value, and convenience to its members since 1948, and expanding our electronic delivery channels was another means of continuing our mission,” Wolf says. “We continue to work hard to enable our members to interact with Alaska USA how, when, and where they wish, providing them with complete access and control of their account relationship.” Launching the mobile site and mobile apps required the development of a new platform. This in turn necessitated expertise that the credit union didn’t have at the time, so it worked with industryleading Outside vendors to introduce both platforms. “Since that time, we have continued to grow those relationships as well as add to our internal team, enabling us to better control the future of these platforms,” Wolf says. Wolf says Alaska USA put a great deal of time and energy into designing, testing, and delivering each mobile channel to ensure the best possible experience for its members. A number of modifications and considerations had to be made. For instance, information had to be much more concise in the mobile channel, as it’s delivered through a variety of operating environments on various screen sizes. Also, many of the buttons and options had to be made bigger so members could easily locate and access them. The mobile space has been popular with the credit union’s members. “We receive over $1.1 million visits to our mobile sites monthly, with more than 70,000 unique visitors/members chooswww.akbizmag.com

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“Both consumers and business owners want access via mobile to their money. We’re always updating our capabilities to enable them to do just that.”

“Customers like to be able to access their banking twenty-four/seven. Online banking gives them the option of accessing their banking anywhere they have their phone.”

—Brian Nerland President, KeyBank’s Alaska District

—Katie Bates, Vice President and Electronic Channel Delivery Manager, Northrim

ing this delivery channel each month,” Wolf says. According to Wolf, Alaska USA was the first credit union in Alaska to offer remote deposit at the end of 2012 (via check deposit app). It has seen great acceptance of this service and continues to develop it. Mobile service delivery is the credit union’s largest-growing service channel, Wolf says, and it’s a focus for continued development. He adds: “As a continually evolving space, we constantly evaluate new functionality that we may provide. Our desire is to consistently provide as many of our services/options as possible, across all of our channels, so that our members can choose how, when, and where they interact with us.”

KeyBank KeyBank also has a mobile optimized website for the convenience of mobile device users. They can use the site to log into online banking, pay bills, and transfer funds as well as find out about consumer deposit and loan accounts and apply for a new account. “Both consumers and business owners want access via mobile to their money,” says Brian Nerland, president of KeyBank’s Alaska District. “We’re always updating our capabilities to enable them to do just that.” Some of the latest additions to KeyBank’s mobile options are the mobile banking and deposit apps. Mobile banking has been a major area of growth for KeyBank, as it has been for many financial institutions. From 2011 to 2012, mobile banking among Key’s customers increased 45 percent, according to Nerland. Key’s Mobile Deposit app allows mobile banking customers to snap a picture of a check and deposit it to their KeyBank personal checking or savings account using an iPhone or Android 16

device. Customers can use the app to deposit checks as late as 11 p.m. EST, which is one of the latest cut-off times in the industry. A fift y cent per-item fee may apply for each check deposit, depending on the type of KeyBank account the customer has. For customers, the fee could be a nominal price to pay to avoid making a trip to the bank to deposit checks. Customers can also view recent mobile deposits via Key’s mobile app. They can see a deposit history with details and check images made in the last ninety days, up to the last one hundred deposits. So far, a significant number of customers have taken advantage of Key’s Mobile Deposit feature. During the first month the Mobile Deposit app was introduced, KeyBank had more than $5 million in deposits. That’s not surprising to Nerland, who says: “We know business owners and individuals want to make sure they’re utilizing all the tools that are available to them to make sure their cash is working for them.” KeyBank also offers text banking alerts to help consumers keep abreast of the changes that are happening with their account.

Northrim’s mobile banking gives customer the flexibility of doing Internet banking without having to log into a computer, Bates says. Plus, customers have the freedom to use whatever webenabled mobile device they choose. Like many mobile-optimized sites, Northrim’s mobile website doesn’t have all the functionality of the bank’s main website. However, it gives customers access to key information when they need it, and they can always visit the main website for more information. The bank’s main and mobile sites work together almost seamlessly. Customers type the same web address into their computer browser or smartphone to access both sites; then smartphone users are directed to the site that’s most appropriate for their browser. Northrim online banking customers can sign up for its text banking option. Once signed up, they can receive an account balance, the last five transactions, transfers between accounts, and other information—all without having to log into their account. “Text banking is a quick method to obtain information if they don’t have time to sit down and log in with their phone,” Bates says.

Northrim Bank Mobile banking options at Northrim Bank center around mobile web and mobile text banking. Both services, which were implemented together about two and a half years ago, are very popular, according to Katie Bates, a vice president and electronic channel delivery manager at Northrim. Currently, 28 percent of Northrim’s Internet banking customers are using online banking, with about 19 percent using text banking. “Customers like to be able to access their banking twenty-four/seven,” Bates says. “Online banking gives them the option of accessing their banking anywhere they have their phone.”

Wells Fargo Wells Fargo has a number of options for mobile device users, including text message receipts for ATM transactions. The new service—launched earlier this year in June—is a natural extension of email receipts, which Wells Fargo has been offering online banking customers since June 2010, according to Alicia Moore, head of Wells Fargo ATM Banking. “We strive to deliver an integrated experience across our channels,” Moore says. “Text receipts for ATM transactions mark the latest way for Wells Fargo Online Banking customers to get a snapshot of their account information via text messages.”

Alaska Business Monthly | September 2013

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The text receipts service is a great value proposition for customers, says Armin Ajami, a vice president and senior product manager with Wells Fargo’s Digital Channels Group. It arrives in seconds—which is almost in real time—and provides a detailed record of the customer’s ATM transaction. “It’s an additional convenience for our customers,” Ajami says. The text message that ATM customers receive includes much of the same information that’s on a printed receipt— except with a few more abbreviations. It includes the type of transaction, master account name, date, and time stamp. A copy of the receipt is also sent to the message center of the customer’s online banking account as a backup. Mobile banking customers of Wells Fargo can also take advantage of text banking or text alerts. Rolled out in March, the service sends text messages to alert customers about deposits, withdrawals, cleared checks, and other account activity that affects their balance. “Mobile banking customers like to see where they stand,” Ajami says. “Text banking gives customers near real time account, so they can stay on top of their finances.” Last September, Wells Fargo rolled out remote check deposit. The feature is available to Wells Fargo customers who install the bank’s app on their Apple or Android mobile device. Remote check deposit uses built-in risk controls to enable customers to securely deposit checks without visiting a branch or ATM. Wells Fargo also redesigned its website to make it more tablet-friendly for mobile banking customers. The objective was to make it easier for Wells Fargo’s monthly online customers and visitors to learn about financial topics, make good financial choices, and get the products and services they need to succeed financially, according to Nyja Stringer, who also is a vice president and senior product manager with Wells Fargo’s Digital Channels Group. Enhancements to the website included new “needs-based areas” that provide easy access to content and products based on financial goals like retirement, streamlined navigation to put relevant content within easy reach, and integrated tips and contact information for customers who want quick access to useful information or need to talk to a

banker. The redesign took into account a tablet’s touch screen, including larger click targets, more white space, and some touch-optimized interactions like swipe (instead of tap and click). Smartphone and tablet users can access Wells Fargo’s mobile site or visit the full site on their mobile web browser. Mobile is also Wells Fargo’s fastestgrowing channel. About half of the bank’s online customers routinely use mobile banking. “More and more customers are discovering and adopting a mobile lifestyle, so we need to be where our custom-

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ers are by providing them with mobile banking services that will help them succeed financially,” Stringer says.

First National Bank Alaska Earlier this year, First National Bank Alaska launched mobile banking to complement its popular text banking option. To access mobile banking, customers simply download the mobile app to iPhone or Android devices or use the mobile site that’s optimized for the mobile banking application. Mobile banking customers can check their balACHIEVE MORE

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ances and recent transactions, transfer funds, make online payments, and get turn-by-turn directions to the nearest First National branch. “It’s a natural extension of online banking, and it enhances the services we provide our customers,” says Cheri Gillian, vice president and corporate marketing director. First National has enrolled approximately 450 new mobile banking users each month, for a total of about 3,500 users as of June. Gillian says the new mobile banking option is a great fit for First National Bank Alaska as well as its customers. The mobile space is where people are going, and it’s especially convenient for Alaskans who travel frequently or who live in remote communities of the state, she says. “We feel very good about the application we offer,” Gillian says. First National is looking at expanding its mobile banking options by adding a separate app for tablets. However, the application most likely won’t be released until next year. First National is a smaller community bank that takes a very personalized and deliberate approach to releasing new products and services, Gillian says. “We’re more thoughtful and deliberate about our product rollouts, so that we can maintain a high level of service,” she says. Gillian adds that a mobile app is only as good as the commitment to quality service that stands behind it. “It’s easy to get dazzled by bells and whistles in technology, but what you want is one [app] that meets your needs and ensures you have the kind of service, security, and safety backing it,” she says. “The heart of the organization that backs it adds the value to the devices.”

Other Services for Mobile Device Users Alaska consumers can also leverage mobile services from a variety of other companies. Alaska Airlines, for instance, lets travelers check in one to twenty-four hours before their flight on Alaska Airlines via the iPhone app, the Android app, or the mobile site. In just a few clicks, they have a mobile boarding pass stored on their phone, which they can use all the way onto the plane. Travelers can display the boarding pass on their mobile device when they check their bags at the security checkpoint 18

and at the gate. “Many customers love the convenience of checking in wherever they are using their smartphone,” says Alaska Airlines spokesperson Marianne Lindsey. Customers can also use their mobile phones to check on their flight. Alaska Airlines’ Flight Status On the Go provides automatic text updates on flights that are departing within the next twenty-four hours. Or travelers can submit a valid flight number by text, and the airline will respond with current flight status information. The service works from all US mobile phone numbers and is available on the day before, day of, and day after the scheduled flight. Lindsey says many of the airline’s customers are embracing mobile devices, so it is important for Alaska Airlines to make information and services available in that channel. “We will continue to add the capabilities our customers want via mobile devices,” she says. As another example, Lynden offers a mobile app that allows people to use smartphones and tablets to access some of its transportation services. Customers can use their mobile device to take advantage of the company’s web-based shipping, tracking, reporting, invoicing, and payment program known as EZ Commerce. The program lets customers enter pickup requests, obtain shipping documents such as a bill of lading, and track shipments. They can also view shipment data, create customized reports, receive invoices, and pay invoices securely online. EZ Commerce was created in 1999 in response to customers who wanted tools to make their shipping process quicker and easier, saving them time and money, according to Marketing and Media Vice President David Rosenzweig. “They save time because they have access to all shipping activities when they need it and money because the technology allows them to focus on other aspects and priorities of their job responsibilities,” he says. Lynden—an Anchorage-based family of transportation companies that ships freight worldwide—is currently developing a new app for mobile device users. The app will enhance the convenience of EZ Commerce by enabling customers to take advantage of all of the program’s features. It will also sup-

Alaska Business Monthly | September 2013

port Lynden’s commitment to always seek new and innovative ways to create better tools for its customers. “We continue to talk with customers to learn what services we can develop to make their shipping experience easier and how technology can benefit our customers by delivering better solutions,” Rosenzweig says. Mobile credit card processing and payments are also a popular component of mobile commerce. Sara’s Gift Cache, for example, is capitalizing on a mobile card reader from ProPay to process credit card payments in real time with a smartphone or tablet. For owner Sara Green, ProPay is the ideal way to process credit card payments at tradeshows because it provides approval on the spot. She can send customers a receipt of their transaction by text or email. Green also sometimes uses ProPay in her downtown-Anchorage retail location. “If we get very busy, it’s nice to have another way of checking people out,” she explains. The ProPay reader is an easy-to-use attachment that plugs directly into the mobile device. Customers’ credit card data is encrypted on the reader head, so it remains protected when swiped. To use ProPay’s mobile payment solution, Green pays an annual fee, plus a percentage of her credit card sales. “It’s good for mobile accessibility,” she says. Google Wallet is a popular mobile payment option for consumers. It supports virtual payments for online and in-store shopping by letting users store and access their credit—and debit card—information on their smartphone. A recently-added feature makes it even easier for people to buy content on some of their favorite Google services. They can make purchases on popular Android apps and mobile sites by clicking the “Buy with Google” button at checkout. Their information is securely applied; they don’t have to type sixteen-digit credit card numbers over and over again. Other major mobile credit card processing and payment solutions are available from Square, PayPal, Intuit, and Chase.  Former Alaskan Tracy Barbour writes from Tennessee. www.akbizmag.com

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ENERGY

Winners of the 2012 Great Alaska Energy Challenge display their awards during a late June ceremony in Anchorage at Bosco’s Comics. From left, Pauline Hooten, The Nature Conservancy; David Scherer, Nortech Engineers; John Hargesheimer, Northech Engineers; and John Weddleton, Bosco’s Comics.

Great Alaska Energy Challenge Turning simple ﬁxes into savings By Zaz Hollander

he winners of this year’s Great Alaska Energy Challenge made a few relatively simple changes to cut heat or electricity use and in return saw major reductions in their utility bills. Really, all the Batcave needed was a few fans, some insulation, and a new thermostat. The Batcave is what Bosco’s Comics owner John Weddleton calls the concrete-block warehouse in Spenard where he stores about a million comics plus sports cards—overstock for his two stores in Spenard and Dimond. Bosco’s, and the Batcave, won the Lowest Use—Electricity category of the

Energy Challenge, a friendly competition now in its second year. Created by the Renewable Energy Alaska Project, known as REAP, the Energy Challenge connects local businesses with state-run efficiency programs and encourages reduced energy consumption during the winter months when utility bills tend to peak. REAP notes that Alaskans each year spend more than $5 billion on heat, electricity, and transportation. The Energy Challenge, then, is part of a statewide goal to reduce energy consumption 15 percent per capita by 2020 and mandate energy efficiency retrofits on

Alaska Business Monthly | September 2013

a quarter of Alaska’s public buildings by 2025. “Our goals are to teach people about saving energy in the workplace by making energy-saving methods a habitual practice,” says Shaina Kilcoyne, REAP’s energy efficiency director. “We really want to create a buzz around energy conservation and encourage others to take it seriously.” Along with Bosco’s Comics, other winners this year were The Nature Conservancy in Anchorage and Nortech, an environmental and engineering firm based in Fairbanks. Winners got more than a pat on the back. This year’s Challenge participants www.akbizmag.com

saved the equivalent of nearly one thousand gallons of diesel fuel. The businesses involved expect to cut thousands of dollars in utility costs. “It’s expensive to do some of this stuff up front but the savings are so incredible,” Weddleton says.

A Better Batcave At Bosco’s, Weddleton took the advice of an energy audit and over time made less than $10,000 in changes he calls “nothing really fancy.” Bosco’s added four fans to blow hot air down from the twenty-two-foot ceiling. Before that, Weddleton says, “you’d go up at the fifteen-foot level and you’re sweating and you drop to the floor and you’re cold.” The business also installed a programmable thermostat, insulated the warehouse with sheetrock, and installed pleated blinds on windows. Employees were encouraged to turn off lights when not in use and unplug appliances. Weddleton knocks down the heat to fift y-five at night, fift y on the weekends. He warms up the building an hour before employees come in. “It makes a huge difference,” Weddleton says. “Really simple stuff.” Weddleton several years ago switched out the gas halogen lights typically used in warehouses for “wicked bright” and more energy efficient T8 bulbs. All told, Bosco’s natural gas use dropped 11 percent in the Challenge time window, which compares energy use last winter to that used the winter before. Plus, the Batcave got a makeover from dreary to decent. “The other benefit was just the quality of life is just so much better,” Weddleton says.

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Energy Awareness For the organizations involved, the Challenge is all about raising public awareness. REAP partnered with the Alaska Energy Authority with support from Green Star Inc. on this second year of the event. Basically, the Challenge pits similar facilities against each other to see which business can lower overall energy use the most. The 2012 contest, open to businesses and other commercial buildings, ran from October 15, 2012 to March 31, 2013. Participants were the Anchorage Park Foundation/The Nature Conserwww.akbizmag.com

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vancy, Automated Laundry Service and Supply, the Bear Tooth eatrepub, Th Bosco’s Comics, Clothesline Consignment Shop, Lewis and Lewis, Lime Solar, Nortech, and Spenard Roadhouse. REAP’s Kilcoyne said she encourages low- or no-cost behavioral changes and urges business owners to get energy audits if they haven’t already. Alaskans pay some of the highest energy costs in the country, she says. Reducing consumption, especially in commercial buildings, can save a significant amount of money. So what did this year’s winners do right? Kilcoyne says they almost all got energy audits. Business owners can pay a certified auditor working for a private company. A program offered by the Alaska Energy Authority—the Alaska Commercial Building Energy Audit Program—can also help pay for part of the cost of an audit for a private commercial business. Two of the three Challenge winners also did lighting retrofits. Kilcoyne called swapping out old-school fluorescents or incandescents “a quick payback” where lower utility bills cover the cost of the retrofit usually within three years. Getting employees involved was another biggie. “Once they’re vested, they’re going to make a little more effort to keep those lights turned off or turn down their equipment at night,” she says.

Nortech: Nix the Heaters Nortech, among other things, is in the business of energy efficiency. The company has performed some 130 energy audits, mostly in schools and public buildings. So despite Nortech’s chilly Fairbanks locale, it shouldn’t come as a shock that

the firm won not one but two of the Energy Challenge’s four categories: biggest change in the amount of heat used as well as the lowest use of heat. But it wasn’t until last year that the company’s Fairbanks home office turned its energy-efficiency gadgets on itself. The trigger: unit heaters warming workers in the front office. “We had some comfort issues in the building,” says Dave Scherer, Nortech’s Anchorage-based senior engineer. “It gets really cold in Fairbanks.” Being in the business, Nortech took thermographic images with an infrared camera and charted stratification of the air. Employees needed heaters at their desks, it turned out, because the front door leaked air. An interior door leaked too. Wall insulation needed improvements in spots. Renting a building can be a huge barrier to making energy-efficiency changes. But Nortech’s building is owned by the company’s owner, John Hargesheimer, through a separate company. So Nortech replaced the front door altogether and installed weather stripping on the interior door and some windows. The business also did some upgrades to the building envelope. Then Nortech installed a set-back thermostat that turns on the heat a few hours before employees come in. The company also replaced all their lights with LEDs— energy-efficient light-emitting diode lights—after studying the lumens released by three different brands. “A lot of these things we did in a somewhat scientific nature,” Scherer says. “We would monitor existing use

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before improvements and then monitor use after the improvements.” The resulting 30 percent drop in energy use saved Nortech a tidy $3,000 in utility bills last winter. “We were actually surprised ourselves at how successful it was,” Scherer says.

Little Things, Big Difference The Nature Conservancy is a worldwide conservation organization. Given their green-leaning profession, it was easy to get employees at the Conservancy’s Anchorage office to start making simple changes in the interest of a more energy-efficient office, says Pauline Hooten, the Conservancy’s executive assistant and office administrator. Those changes resulted in an Energy Challenge win in the category of biggest change in electric use. The Conservancy started making adjustments several years ago based on the recommendations of a 2010 energy audit. “We put a timer on the electrical unit that heats hot water for the office. We asked folks if they would turn off their computers at night. We’ve been changing out incandescent lighting to compact fluorescents,” Hooten says. “Honestly, those little things made a really big difference.” Small appliances like toasters and coffee pots—phantom power users—get unplugged when not in use. The office replaced some thermostats with programmable ones. Now the Conservancy is looking into a lighting fixture retrofit. Last winter, Hooten estimated, the office saved one thousand kilowatt hours of electricity. “You need to spend some money to save some money,” Hooten says. A Rc

H I T Ec

For more information on the Great Alaska Energy Challenge, go to akenergychallenge.org For more information on getting an energy assessment for your business, go to production. akenergyefficiency.org/get-acommercial-energy-assessment/ A New Challenge The next Great Alaska Energy Challenge will be a little different. Kilcoyne, with REAP, says the event changes every year. The first Challenge focused on statewide public facilities such as schools or water/sewer treatment plants and libraries. This year focused on private buildings, mostly in Anchorage. Next year, REAP plans to partner with Chugach Electric Association on the utility’s “O Power,” a pilot program to help residential members save energy and money through social applications. The Challenge will involve school districts in Chugach territory, Kilcoyne says. She’ll be working through school classrooms on a competition involving students trying to reduce electric use at home. Kilcoyne says she expects the Challenge’s third year to be the best yet now that she’s had two years to put together detailed outreach material and work out any kinks in the program. “I’m hoping this just gets bigger and bigger,” she says.  Zaz Hollander is a journalist living in Palmer.

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CONSTRUCTION

High End Homes Photo courtesy of Ralph Brodin, EE/CC Fine Homes

Photo courtesy of Ralph Brodin, EE/CC Fine Homes

Upscale and customized By Gail West

omes available for sale in Anchorage were at a three-year low in May 705, less than the 774 for sale in May 2012—and the vast majority of those home sales fell into the $300,000 to $500,000 range, according to the Alaska Multiple Listing Service’s Anchorage Market Statistics. The average sales price came in at $336,454. In the twelve-month period of May 2012 to May 2013, two homes sold for more than $750,000 and thirty-four sales in the same range were active as of the Statistics’ publication date. Over the same period, one home sold for more than $1 million and twenty-six were active. The inventory of $1 million-plus homes for sale in Anchorage in May was forty-two, and that represented 4 percent of the total. Is there a glut of high end homes in Anchorage? Sharen Walsh, PE, deputy director and building official for the Municipality, says her department hasn’t seen any building permits for

Top: Featuring a concrete board-form feature wall at the entrance, this home by Jon Hawkinson in Sky Harbor Estates also incorporates metal and commercial-grade, storefront glass in its exterior. To the left of the home is the hangar for the owners’ plane. Above: Builder Ralph Brodin added a custom bench which pivots 360 degrees in this Anchorage hillside home. The bench was crafted from a timber repurposed from the old Garner tunnel when the Alaska Railroad rerouted tracks. Edges of the bench were carefully sanded to save the patina from the years of smoke in the tunnel. Left: This million-dollar seasideshingle home is a remodel of an old lake house. Custom home builder Ralph Brodin added natural stone and penny copper with a patina to the exterior and made the home energy efﬁ cient. Much of the home’s material consists of reclaimed materials.

homes more than the $1 million mark this year and has only one current permit for a home more than $750,000. “We’ve seen many more residential permits in the under-$500,000 range,” she says. The one high end home is being built in Eagle River. “It will have 5,898 square feet of living area and is valued at $965,098.”

Buying Upscale Brandy Pennington, a Realtor with Keller Williams Realty, says today there are about three dozen homes for sale in the Anchorage area at or near the $1 million mark. Ranging in size from 10,632 square feet for $2 million down to 2,400 square feet for $1.1 million, these homes span the city from Prominence Pointe off Golden View Drive to Campbell Lake to Atwood Estates, a new, gated neighborhood just off Forest Park Drive. Pennington says the real estate market changes rapidly. “There are several vari-

Alaska Business Monthly | September 2013

ables that factor into the resale of any home in Anchorage,” she adds, noting that in July interest rates rose from 3.25 percent to 4.7 percent. “Buyers who are not locked into their loan rates have just lost thousands of dollars in purchasing power.” Prices per square foot also vary considerably. “The low end now is about $135 per square foot up to about $220 per square foot.” The trend now, she adds, is moving away from the “massive hillside homes. Buyers are looking to upgrade existing homes in town.” The amount of time it takes a person to drive down from the hill to work or to the nearest store is beginning to offset the value of the location, she says. Other factors in the downsizing trend include high property taxes and utility costs as well as people wanting a more urban lifestyle. “Today’s buyers are more educated,” Pennington says. “They are weighing the cost to the benefits and features of a home, often asking ‘how will this home perform for me?’ www.akbizmag.com

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“Typically speaking, the people looking for higher end homes are working professionals. They’re young adults in their thirties and forties looking to buy in neighborhoods such as Turnagain or Rogers Park and finding $250,000 to $300,000 homes. They’re also finding it’s likely going to be less expensive to tear those houses down and rebuild rather than trying to remodel them,” she adds.

Custom Designs There are some buyers, however, with the time and the funds to seek special homes for themselves—homes that have been designed and constructed to suit them and their lifestyles. Custom homes have been and still are being built in Anchorage. Architect Mark Ivy, owner of Ivy & Co. Architects, says he’s having a “light” year for designing custom homes. “The whole dynamic changed last year,” he says. “Normally, we have about a dozen to eighteen custom homes and remodels going. This year, we have five or six. However, it looks like next year is going to be a much bigger year—we already potentially have a dozen homes lined up.” Ivy adds that his company has done a range of building designs running from commercial to remodels. “The most expensive home we’ve designed was about $7.5 million, but most of our homes have run from $650,000 to $1 million.” Over the thirty-five years he’s been designing homes, Ivy says, he’s had requests from all across the state—from Dutch Harbor to Barrow to Southeast communities. Like Pennington, Ivy says the design of a home has to work for the people that live in it. “We focus on the function of a home,” he adds. “What happens at different times of the day, where is the sun, what changes between summer and winter, where are the neighbors? A house shouldn’t be a random placement on a piece of property. It should take advantage of all the character the property has to offer.” The general timeline for designing a custom home, Ivy says, is probably about five to six months. “It usually takes from one to three or four passes before everyone is satisfied,” he says, “and I try to keep my turnaround time to two weeks for a three thousand- to five thousand-square-foot home, depending on the time of year.” 26

He also adds that the optimum custom design usually results from a team of people working together—the architect, a structural engineer, a builder, and the trades. “We try to get a philosophy fit,” he says. “We try to introduce a homeowner to up to four builders so they can get a good cross section and find the best match. Then we have the team working together with the budget, design... to get the best home without having to deal with a runaway train.” Ivy says two of the homes he’s designed in Anchorage are among his most recognized—one, a timber-frame on the Anchorage hillside, is built to resemble a dragon; the other pays homage to the shape of the iconic Quonset hut, now being phased out in Anchorage. Ivy’s real joy in designing homes, though, is seeing the way his clients enjoy them. “It’s like Christmas,” he says, “when clients see their finished homes.”

Built to Suit Who builds these high end and custom homes? EE/CC, Hawkinson Construction, Inc., Colony Builders Inc., Crown Point Homes, and WillowRidge Construction are a few of those working in the Anchorage-area market. Jon Hawkinson, owner of Hawkinson Construction, says he followed in his father’s footsteps, working alongside his dad since the late 1960s. On his own for the past twenty years, Hawkinson says he owes his success to the clients, architects, and trades people with whom he’s worked. “We usually get involved in one of these homes when the architect calls and asks if we’d like to work on the home he or she is designing,” he says. “We step in before the design is totally done and work with the architect and client on how the home will work structurally, what products to use, what kind of materials—bouncing things off each other until we have an end product. I like that because I can get my head wrapped around the project before it really breaks ground.” Each home is unique, Hawkinson adds, but they are all finely finished. “From the foundation system up, these are one-of-a-kind projects.” Today, Hawkinson says he has two homes under construction now and three going to start soon. Only one of the homes he’s currently working to build is a luxury home—encompassing twenty-three

Alaska Business Monthly | September 2013

thousand square feet—that he says he’s in the finishing stages of construction now. “One of these homes can pretty much tie us up for a whole year,” he adds. Hawkinson says that of all the homes he’s built, he has a really soft spot for timber-framed homes. “They have such a warm feeling,” he says. The wood and the joinery are exposed and the craftsmanship is apparent, he adds. “One house we did a remodel on was a doctor’s house and my dad came on board to help with it. The entire back of the house was timber-framed glass and my dad designed the whole thing. He milled all the material for the structure it turned out absolutely gorgeous,” he says. Hawkinson has built many custom homes in Anchorage but one built in Atwood Estates, a $5-million, twenty-two thousand-square-foot home, he’s enjoyed building—although, he says, he enjoys them all. “That particular one was designed by a New York architect for a longtime Anchorage family, and it’s a wonderful house.” He adds, “We put two huge truckloads of limestone from Minnesota into that house.” Another of his homes has a beautiful indoor pool, a regulation-sized gym, and lots and lots of wood casework.

Tailor-Made Ralph Brodin, also a custom-home builder, has been creating unique homes and vacation getaways in the Anchorage bowl, primarily the Girdwood/Alyeska area, for nearly forty years. Operating as EE/ CC Fine Homes, Brodin says he has two tenets by which he designs and builds his homes: high quality and energy efficiency. “I got started in custom homes because my clients wanted to do something interesting and different from what they wanted in Anchorage,” he says. “Basically, I just fell into this market niche. I designed and built a home for an individual in Girdwood. While I was building that, I gained a reputation and my next project was a little house for the editor of Alaska Magazine. That was thirty-five years ago.” In addition to building high end homes, Brodin also designs many of them. “We’ve just finished one on Campbell Lake that was my design,” he says, “and we have one in construction.” The one going up is in Girdwood and is for an unnamed television celebrity, according to Brodin. www.akbizmag.com

In the past year, though, Brodin says he’s built four custom homes and generally builds anywhere from one to four homes a year. “Each one will generally take a year and a half to two years to complete because of the customization,” he adds. “About 90 percent of all my homes now are over a million.” Most of Brodin’s clients reach him through word of mouth and come with their own bare lots. From there, he says he creates the design then builds the house. “Some clients are very involved in the design,” he adds. “Others basically just want to approve it.” Brodin says there’s been no trend in the custom-home market that he’s been able to track. “Sometimes there’ll be only one house and sometimes there’ll be four,” he says. As for the difference between custom homes and “production” homes, as architect Ivy calls those that are built without a custom client in mind, Brodin says they are really big houses with the costs driven by the size of the home. “They generally use store-bought trim and conventional siding. They may put a high end kitchen in it, but that doesn’t bring the whole house up to the standard of a custom home,” he adds. “Even $200,000 houses have granite counters now.” Although a well-built house is still a well-built house, Brodin says, “a real high end house in my opinion would have real stone, not fake stone. It would have stone or wood floors, custom cabinets and counters. It would have very nice wood windows, clad on the exterior and triple pane, high end heating systems, and so on. There’s a big difference between those homes called ‘custom’ and those that really are custom,” he says. Brodin adds that all his homes are completely custom, right down to a custom door that he makes in his woodshop. Occasionally, he’ll even make furniture for a home. He also credits the craftsmen in the trades that help build his homes. “You can’t make people do good work,” he says. “They have to want to do it. I’ll tell a client that if my wood-flooring guy, for example, isn’t available, that I’ll hold the house open and wait for him.” “I like to think one of my homes will be around for generations,” he says. 

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MILITARY

Coast Guard’s Arctic agenda heats up By Zaz Hollander

s Arctic ice melts, the US Coast Guard is in the midst of a sweeping mission to study and safeguard the increasingly busy marine domain off Alaska. The effects of climate change mean the Arctic is a whole new ocean, opening up while the world watches. The fabled Northwest Passage has become

real. Scores of vessels—cruise ships, cargo vessels, fishing boats—now navigate once-impassable waters via the Northern Sea Route that connects the Atlantic and Pacific oceans. Arctic countries like the United States, Russia, Canada, Denmark, and Norway are vying for claim on potential oil and gas, diamonds, or rare earth elements.

Alaska Business Monthly | September 2013

Other global resource powers—China, Japan, India—are paying close attention. The entire Arctic—not just that within the United States—is thought to hold 13 percent of the world’s undiscovered oil, 30 percent of its undiscovered natural gas, and a tremendous amount of minerals. Charged with protecting the environment and safety of US waters, the Coast www.akbizmag.com

er says. “It’s economically strategic, it’s politically strategic. When you have access to resources, recreation, transport, shipment, there’s going to be more activity.”

NOAA Chart of the Arctic Coast. SOURCE: NOAA

Guard this summer is stationing two icebreakers, three cutters, and a helicopter along the Alaska’s Arctic edge. “The reality of the matter is in September 2012 we observed the lowest sea ice extent in recorded history,” says Captain Jonathan Spaner, who is implementing Arctic strategy as the Coast Guard’s Washington, DC, director of emerging policy. The extent of ice dropped by 40 percent compared to the most recent record low of 2007, Spaner says. “The trend line is clearly down—there’s less ice over time. When you have open water, it’s a very significant region,” Spanwww.akbizmag.com

Eyes on the Bering Alaska has more than a thousand miles of coastline above the Arctic Circle on the Beaufort and Chukchi seas. The Coast Guard has jurisdiction over more than two hundred thousand square miles of Arctic water along the North Slope alone. This summer marks the second of a ten-year strategy to ramp up Coast Guard presence in the Arctic Ocean, a mobile operation known as Arctic Shield. This year’s Arctic Shield will focus more to the northwest and the Bering Strait. The strait is a choke point for traffic moving through the Northern Sea Route, and there’s still plenty of traffic there, according to James Robinson, the Juneau-based Arctic coordinator for the Coast Guard’s District 17. The past four years has seen traffic through the Bering Strait increase by a multiple of ten. The Northern Sea Route saw just a handful of transits in 2010. But nearly thirty vessels traveled the route in 2011. Last year, the number was close to fift y. Ships carried a million tons of cargo through the region last year. While the Coast Guard doesn’t provide specifics on port visits and timing, citing security concerns, here’s a partial list of the equipment and operations slated for the Alaska Arctic this summer: n One HH-60 helicopter, stationed at Kotzebue n Two icebreakers, the Healy and the Polar Star, which is coming out of mothballs and making ice trials n The national security cutter Waesche, which will test communications capabilities n The large patrol cutter Naushon n A buoy tender will work with the Canadian Coast Guard cutter Sir Wilfrid Laurier on passing and towing exercises as well as oil-skimming deployment n C-130 aircraft will overﬂy the Arctic Ocean to scan the ice pack September 2013 | Alaska Business Monthly

U.S. Coast Guard photo

Start of the Surge Last year, the Coast Guard kicked off Arctic Shield 2012 amid a frenzy of activity. Royal Dutch Shell moved two drilling rigs to the Arctic Ocean to explore for offshore oil. The energy exploration work brought several thousand people to the North Slope for industrial support. Many required transport via private helicopter to drill rigs. It also brought scores of temporary residents to Arctic communities, primarily Barrow, where customers deluged restaurants and hotels. Last summer, the Coast Guard based two HH-60 helicopters out of Barrow in response to the oil drilling programs and related activity. This summer’s deployment of Coast Guard resources, dubbed Arctic Shield 2013, reflects a down year in terms of oil exploration. No companies are working offshore in the Arctic this year, though Exxon is ramping up its gas project closer to land at Point Thomson. Instead, this year’s operation will devote more to training and research with a focus on the Bering Strait. “Arctic Shield 2013 was planned to fo-

An aircrew member from an MH-65 Dolphin helicopter crew escorts a ﬁ ftynine-year-old crewman with an irregular heartbeat to the helicopter waiting on the Shell drill rig Noble Discoverer’s helipad in August 2012 in Norton Sound sixty-eight miles west of Nome. Medevacs and other rescues are part of the Coast Guard’s expanding mission in the Arctic.

cus more on the nature and volume of maritime traffic that goes through the Bering Strait,” Spaner says. “We want to use this year to really assess and look at Western Alaska and the Bering Strait and

the nature and volume of the traffic.”

Vying for a Share of the Arctic The Arctic is not a hospitable place to do business. Temperatures drop to sixty

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below. Winds howl, sometimes topping seventy-five mph. Darkness blankets the region half the year. Icebergs loom. Nothing comes easy. But the lure of Arctic resources overcomes the inhospitable. Even as the Coast Guard moves ahead with its mission, representatives acknowledge that the United States has yet to resolve major questions about which countries can lay claim to which newly opened waters. In May, the Commandant of the Coast Guard Admiral Rober J. Papp Jr. released the US Coast Guard Arctic Strategy. The document lays out a strategy that includes improving awareness of the Arctic environment, modernizing governance to protect US sovereignty, and broadening partnerships. For the past several years there has been a race by countries other than the United States to file internationally recognized claims on the maritime regions and sea beds of the Arctic, according to remarks made by Papp as he unveiled the Arctic Strategy. “While the United States stands by, other nations are moving ahead in perfecting rights over resources on an extended continental shelf. Russia, Canada, Denmark (through Greenland), and Norway—also Arctic nations—have filed extended continental shelf claims under the Law of the Sea Convention that would give them exclusive rights to oil and gas resources on this shelf,” Papp says. “They are making their case publicly in the media and in construction of vessels to patrol these waters. Even China, which has no land mass connectivity with the Arctic Ocean, has raised interest by conducting research in the region.” Papp urged Congress to give the United States more legal standing in Arctic policy by acceding to the Law of the Sea Treaty, like all other Arctic nations. Meanwhile, in late May the Arctic Council agreed to expand its membership beyond the original eight Arctic members to six new “observer states”: China, India, Italy, Japan, Singapore, and South Korea. “Our presence is part of catching up with the rest of the world in terms of sovereignty,” Robinson says. “And the potential resources for the country, whether it be seabed hydrocarbons or www.akbizmag.com

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An MH-6o Jayhawk helicopter from Air Station Kodiak delivers supplies to the Coast Guard Cutter Bertholf in September 2012 in the Arctic Ocean. The Bertholf crew was deployed in support of Operation Arctic Shield 2012. Another cutter, the Waesche, is stationed in the Arctic this summer. U.S. Coast Guard photo by Petty Officer 1st Class Timothy Tamargo

rare earth metals or even, to a large extent, the cultural resources.”

Wary Locals Some Arctic residents also view the coming of increased development, traffic, and general activity with trepidation. A June meeting of the Alaska Arctic Policy Commission in Barrow revealed deep concerns about the potential effects on the environment and on local communities of local demands from offshore oil drilling and increased shipping traffic, according to a report in The Arctic Sounder. Northwest Arctic Borough Mayor Reggie Joule summed up the concerns he heard in a question: “What’s in it for us?” “We have the highest cost of energy anywhere,” Joule says, according to the Sounder story by Carey Restino. “We are producing energy and have been for forty years and we are paying the highest cost. What’s in it for us with regards to energy, with regards to food security? What’s in it for us for workforce development when we have such few numbers of people?” Unlike the tax structure at Prudhoe Bay, where oil-based revenues flow to 32

local governments, development of the offshore oilfields would take place on federal lands where no such revenuesharing relationship currently exists. Joule encouraged the council to explore local job-training programs so local residents might be able to take advantage of potentially expanding fields.

Challenges of Changing Ice A workshop last fall at the University of Alaska Fairbanks brought together Coast Guard operational experts, academic researchers, Alaskans, and scientists from the United States and Canada. According to the Department of Homeland Security, three working groups during the workshop came up with the following challenges: n Infrastructure: Long distances between Coast Guard bases and the Arctic make rescue missions problematic. Building more bases is challenging, too. Close-in sites could require large, heated hangars requiring rigorous design and construction criteria.

Alaska Business Monthly | September 2013

The closest year-round fully staffed operational base is in Kodiak, nearly 1,000 miles by air from the Arctic—much farther by sea. The first leg of an oceangoing journey from Kodiak is about 600 nautical miles through the Gulf of Alaska to Unimak Pass in the Aleutians in order to get to the Bering Sea, then double and triple that distance to get to points in the Alaska Arctic. Roughly, the approximate distances from Kodiak in nautical miles to: Port Clarence (1,200 miles), Kotzebue (1,450 miles), DeLong Mountain Terminal (1,450 miles), Wainwright (1,680 miles), Point Barrow (1,750 miles), and Prudhoe Bay (1,955 miles). A nautical mile is 6,076.12 feet or 1.15 statutory miles, allowing for one minute of latitude. n Communications: Rescuers can’t respond to a distress call they can’t hear. Few radio repeaters and no ship-to-shore cables or cell towers—or power sources—make for extremely www.akbizmag.com

limited communications infrastructure. Researchers are trying to identify and develop appropriate communications systems for this environment. At times, a fishing vessel may be the closest potential rescuer in case of a distress call. The Coast Guard hopes to at least hear every distress call and contact the closest ship in minutes; the rescue could even be monitored by video. n Sensors: Sensors are critical to the Coast Guard’s awareness of activities in the Arctic. Operators need to sort a wealth of navigation, heat, sound, and other data from sensors on planes, ships, buoys, in space, and on the sea ﬂoor. A network of sensors could help answer a range of questions. How thick is the ice? How deep is the seaﬂoor? Has oil spilled? If so, how fast is it spreading and where? Where are the marine mammals? Are that helicopter’s rotors about to ice up?

Finding the Funds The Coast Guard refers to Arctic Shield as a “mobile” operation that comes and goes with the ice-free summer season.

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“We’ve worked very, very hard to pull together what we think is a robust risk-based assessment of where we can use the required flight hours and fuel to cover down in the Arctic.” —James Robinson Arctic coordinator, Coast Guard’s District 17

Unlike those at Kodiak or Juneau, for example, there are no permanent Coast Guard bases, infrastructure, or operating forces along the Beaufort or Chukchi seas. There are also no deepwater ports there. The US Army Corps of Engineers is in the midst of a major study into where such a port might go. The Corps is in the early stages of examining the potential of Nome or Port Clarence. The Coast Guard initiative doesn’t come with money for infrastructure. Instead, summer deployments depend on what’s already there. The helicopter at Kotzebue, for example, makes use of an Alaska Air National Guard hangar. At this point, the Coast Guard is still analyzing just what needs a changing Arctic has in terms of basic needs for future development. Perhaps the biggest challenge in the

near term is the fact that funding for Coast Guard operations in the Arctic is limited this year, officials say. Last year’s oil drilling program drew attention and resources. It also marked the first year of a full-time seasonal Coast Guard presence in the Arctic. This year, recovery efforts for Hurricane Sandy and other major responses drew resources away from Alaska. “What we’re wrestling with is the resource climate right now,” Robinson says. “We’ve worked very, very hard to pull together what we think is a robust risk-based assessment of where we can use the required flight hours and fuel to cover down in the Arctic.”  Zaz Hollander is a journalist living in Palmer.

September 2013 | Alaska Business Monthly

HR Matters

By Kevin M. Dee

Alaska Native Leadership Melding a rich past to a bright future

he Alaska Native Claims Settlement Act that created twelve regional Alaska Native Corporations (ANCs) and encouraged numerous tribal corporations was the beginning of a journey of socioeconomic independence that is still underway today. It is quite remarkable and heartening to see the success of these Alaska corporations given the relatively short amount of time they have been in existence and the struggles they have endured. Some have benefitted from the Small Business Administration’s 8a Business Development Program (no bid government contracting). Unlike many non-Native for-profit organizations, most ANCs also have the social well-being of their people as a core mission. Most other corporations do not include the social well-being of shareholders in mission statements. The cultural values that are at the core of many Alaska Native Corporations and the way in which they grow their own leaders might be lessons for us all. ANCs and tribal businesses have had to find the difficult balance of being able to walk in two worlds. The first is coming to terms with the deep cultural definitions of who they are as Alaska Native people and staying connected to that in a rapidly changing world. The second is learning and embracing Western business practices. This was difficult at first, with many failures and some groups still struggling today. However, when cultural values were truly incorporated as the basis for sound business decisions, then dramatic change began to occur. The organizations that have embedded valuebased decision-making within their organizations that are based on traditional cultural values might even have an advantage over others that have not.

Value-Based Decisions Values determine our daily decisions in business and in life, and Alaska Na34

tive values are derived from thousands of years of living together and surviving some of the harshest climates of the world—they are of necessity a code for living and working together for a common good. When they are applied in a corporate culture appropriately they can have a cohesive effect. Many of the cultural values include loyalty to family and culture, sharing and cooperation, learning and acquiring knowledge, and quality of life. The emphasis is on the whole group as family versus the individualistic “get and make as much as you can” mentality of the Western business model. There are dozens of books and business gurus that preach that business success is tied to corporate culture and the values that drive it. When ANCs meld their cultural values with business savvy it is a potent recipe. When these blended approaches are applied in a corporate setting they go a long way in creating a unified culture of success. This is not to say that ANCs are brilliantly successful solely because of these cultural values. But their valuebased decisions are a key ingredient to their long-term success. Today’s leaders must be competent in both cultural and business matters, which is not always easy to do.

entering the market seeks healthy balanced workplaces for a better quality of life instead of the workaholic values of their predecessors. ANCs are addressing these issues with foundational scholarships and educational supports for their shareholders and by “growing their own” professionals. Some ANCs have developed cutting-edge leadership development programs—like Doyon, Limited’s Doyon Leadership Training and Bristol Bay Native Corporation’s Training Without Walls—that are open to shareholders. In addition, other organizations are embracing the need to develop and support strong Alaska Native leaders. The First Alaskans Institute’s Emerging Leaders Forum and the Alaska Native Professional Association are but two with superb programs that are developing, networking, and supporting these up-and-coming leaders. All of these programs emphasize the personal and interpersonal skills as well as the business competence that is essential for Western business success. As Alaska Native cultural values are realized within the Alaska Native world, their strength and accomplishments will continue to grow. 

Embracing the Need The future is exciting for ANCs and tribal groups as they incorporate their rich cultural history and astute business practices. We hear again and again that the battle for recruiting and retaining talented people will be the defining factor in the future success of all businesses big and small. This becomes more and more apparent with so many boomers phasing out of the workforce. Businesses are left with a shrinking population to fill the diminishing ranks, especially in professional positions. The up-and-coming talent

Kevin M. Dee has a master’s degree from Vanderbilt University and is the president of KMD Services & Consulting. He has more than twenty-eight years of experience providing leadership development, organizational development, and human resources services in Alaska and internationally. Contact him at mail@kmdconsulting.biz.

Alaska Business Monthly | September 2013

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TELECOM & TECHNOLOGY

By Bob Walsh

A high-speed microwave tower in Unalakleet is part of Phase 1 of TERRA Northwest.

n Thanksgiving Day in 1982, GCI carried its first long distance call. This was just the start of the thirty-year journey to bring advanced telecommunication services to all of Alaska—both urban and rural. And this journey continues as the technology environment—in Alaska and around the world—rapidly changes.

Satellite Connections Currently, many Alaskans still receive all communication over satellite connections that are costly and plagued by signal delay. The lack of dependable highspeed connectivity limits the ability of hospitals, local health clinics, schools, and businesses to take advantage of such powerful tools as virtual classrooms, telemedicine, and modern business applications. People living in these areas are neither able to participate in today’s 36

knowledge-based economy nor able to access global information resources. In line with the more than 25 percent of Americans, Alaskans are increasingly ditching their home telephones in favor of wireless phones. This, paired with the continually advancing devices on which we’ve all come to rely, creates a never ending appetite for bandwidth, wireless, and advanced applications. Satellite has been a great success story in Alaska and is still the only way some of the most remote regions can communicate. With advanced technology and large investments in satellite transponders, almost all Alaskans can receive reliable, high quality voice communication and Internet services. However, high-latency satellite is not the long-term answer. Currently any Internet connections available via satellite travel from a home or business to a ground station, where

Alaska Business Monthly | September 2013

they are uplinked. Those connections are subject to latency—the delay caused by the time needed to beam a signal to a satellite and back to Earth—and subject to disruption. Sending an image may take twenty or thirty minutes—far longer than with terrestrial systems.

Two Billion Dollar Investment Alaska needs to catch up in order to compete in the global economy, which is now completely reliant on fast and reliable broadband and wireless services, mostly delivered by fiber optics. In addition, recent provider partnerships mean that the vision of a statewide wireless network is becoming a reality, promising better coverage over a wider area for 95 percent of Alaskans. Furthermore, satellite is too costly and, even at its best, constrains service for residents, businesses, government, schools, and hospitals. www.akbizmag.com

Golovin will have terrestrial connectivity as part of TERRA Northwest.

GCI’s network of voice, video, and broadband services now passes 80 percent of Alaska households. To do this, we have invested more than two billion dollars, continuing with our founding vision of providing services to all Alaskans and operating an extensive state-of-the-art telecommunications network into, around, and out of Alaska. Several years ago we developed a vision of taking all of Alaska off satellite and building a terrestrial network. No one thought we would or could do it. But ultimately we began designing and planning to build a terrestrial network to Alaska’s remote regions. We call this

effort TERRA—Terrestrial for Every Rural Region in Alaska—and this vision is quickly becoming a reality.

First Big Step TERRA Southwest was the first big step. It includes four hundred miles of new fiber-optic cable and thirteen new microwave towers connecting sixty-five communities from Quinhagak to Hooper Bay to Grayling. Built in 2011—ahead of schedule and under budget—TERRA Southwest is already providing high speed terrestrial bandwidth to fifty-four of the communities, and we have plans to quickly roll out service to the rest. People

in the Southwest region went from unreliable satellite services to terrestrial reliability and speeds that are eight to sixteen times faster for the same price. Today TERRA is improving the lives of residents in Southwest Alaska. The Chaninik Wind Group (CWG) and Intelligent Energy Systems built a series of smart grids designed to integrate cheaper wind power into their energy systems. Initially the grids relied on satellite Internet service for remote communications and data transmission, but for a number of reasons it wasn’t up to the task. Weather, long lag times, and satellite dishes that needed frequent adjusting all hampered CWG’s effort to use as much wind energy as possible. CWG currently has two wind-heat systems up and running in the villages of Tuntutuliak and Kongiganak. Each village operates five 95kW wind turbines on eighty-foot towers out on the tundra. The turbines, the diesel generators that produce electricity, and the meters in local homes and offices are all interconnected by a local area network. That allows local utility managers to monitor all operations with supervi-

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Main Pay-Off The main pay-off from all that technology is that each village can control the power flows in its system as wind speed changes, turning parts of the system on and off and configuring various components to minimize diesel generator use and optimize wind energy distributionâ&#x20AC;&#x201D; the more the wind blows, the more wind energy displaces the fuel used to power diesel generators. When the wind blows long and hard enough to meet all regular electricity needs, surplus wind energy kicks over to power thermal storage devices, a new type of ceramic heater now installed in many homes. The surplus energy costs about half as much as diesel fuel, so many families are seeing their total household expenses reduced by as much as half. At the same time, when they pay their energy bills, their money goes to their local utility instead of to outside fuel oil companies, keeping it closer

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ÂŠ GCI

sory control, data acquisition systems, and automated electrical metering. TERRA brings it all together, also enabling a variety of remote management, monitoring, and diagnostic services.

Field conditions are rough at Cape Nome where TERRA Northwest is under construction.

to home where it can help nurture other community development projects. Dennis Meiners of Intelligent Energy Systems points out that with TERRA, aside from being able to measure and

control energy production and consumption more accurately, local utility managers now have reliable access to real-time technical help from engineers and suppliers all over the world. More importantly,

September 2013 | Alaska Business Monthly

Another view of the microwave tower in Unalakleet. © GCI

they can take advantage of advanced metering and reporting systems supported by web-based applications. “The villages use the smart grid system every day,” says Meiners, “and its value only increases when it is paired with reliable cell phone service via TERRA. Every day, there are texts and pictures between local power plant operators, engineers, and technicians. Issues are addressed and problems are diagnosed and solved right away. Utility managers have tools that didn’t exist before and expensive technical support trips back and forth to villages have pretty much been eliminated. TERRA has improved communications across the spectrum of operations, and that results in bringing improvements that were simply too difficult and too expensive to implement without it. As time goes by, and we learn how to improve the productivity and economics of village energy systems, TERRA will probably be taken for granted, but it is already a key asset in lowering power costs for many Alaskans.”

More Benefits Another energy-related benefit for Alaskans due to TERRA involves AVEC, or the Alaska Village Electric Cooperative—the nonprofit electric utility owned by the people it serves in fift yfive villages throughout Interior and Western Alaska. AVEC is beginning to connect some of its power plants to its Anchorage headquarters through 40

TERRA for improved monitoring and efficiencies. For the first time ever, field personnel are able to communicate with other team members while they are in the field. TERRA allows for improved communications between AVEC’s smart meters and the office, as challenges posed by the original copper telephone networks are overcome by TERRA’s high-speed, state-of-theart system. In addition, TERRA gives AVEC the opportunity to plan for future cloud services, opening up tremendous possibilities for the organization. TERRA is also bringing modern technology to healthcare in Southwest Alaska. Because of TERRA, the Yukon-Kuskokwim Health Corporation has a much faster network, allowing it to improve a variety of healthcare services, says Joe Shawler, who works in the Yukon-Kuskokwim Health Corporation’s technology division. Previously, for instance, sending a medical image might take several tries as the slow connection timed out. But now X-rays and other medical images can reach destinations in seconds.

Phasing in the Northwest After completion of TERRA Southwest, GCI set out on finding a way to bring terrestrial connectivity to the Northwest region using a hybrid system of groundbased fiber-optic cable and high-speed microwave antennas to link dozens of Alaska villages. The distance education and telehealth customers within that region

Alaska Business Monthly | September 2013

demanded it and it is now underway. Construction has been completed on Phase 1, which extended the network to Unalakleet and Shaktoolik. Phase 2 has begun and construction to Nome will be complete by the end of 2013. Phase 3—to Kotzebue— has also started and will be completed in 2014. This will be the first time Kotzebue has communicated off satellite. Once TERRA Northwest is complete, GCI plans to extend TERRA to the Northwest villages and complete a connection back to the fiber along the transAlaska oil pipeline, giving TERRA the redundancy and protection necessary to fully support the state. The benefit of will be much faster connections through the Internet, opening up new possibilities in education, commerce, and healthcare for all Alaskans.  Bob Walsh grew up in Nome and has worked on issues statewide facing Rural Alaska in various capacities throughout his career. He is currently the Director of Rural Broadband Development at GCI. Walsh most recently worked on United States Senator Lisa Murkowski’s staff in Alaska covering Rural Alaska. He resides in Anchorage with his wife Patrice. www.akbizmag.com

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MINING

Photo by Greg Martin for Kinross Fort Knox.

One of nineteen Caterpillar 793D trucks in the Fort Knox ﬂeet. This one’s new and cost $4.2 million; it can haul a 240 ton load.

Elephant-Load Trucks The machines that mine Alaska By Julie Stricker

lephants likely aren’t the first thing that comes to mind when talking about mining in Interior Alaska, but they are an apt metaphor for the equipment used at Fort Knox gold mine. Fort Knox, owned by Canadian mining firm Kinross Gold Corporation, is located about twenty-five miles northeast of Fairbanks. The mine is dominated by an enormous pit that is more than 1,400 feet deep and a half-mile across. The pit resembles a gigantic inverted ziggurat, with thirty-foot benches ringing the sides. From the top, what looks like a line of Matchbox-size trucks rumble down the road to the active mining area where they are filled with ore before heading back up the pit to the crusher or heap leach.

Only when they come near does the scale of the whole operation become apparent. This is where the elephants come in. “We ask the school kids ‘How many male African elephants do you think can fit into this 240 ton haul truck?’” says Anna Atchison, manager of community and government relations for Fort Knox. The question is an icebreaker on schoolkids’ tours of the mine, but it’s also a pretty good indication of the size of the trucks. The answer is thirty-five. The huge trucks are necessary for the scale of operations at Fort Knox, where more than 5 million ounces of gold have been produced since 1996. The gold itself is microscopic. In the more than one hundred years of mining in Interior Alaska, the nature of the

Alaska Business Monthly | September 2013

ore bodies, as well and the methods and mining equipment, are constantly changing, refined, and updated.

Big Change in Equipment When prospectors first moved through Interior Alaska in search of gold in the late 1800s, they carried the standard mining equipment of the day: a pick, shovel, and gold pan. Onsite, they constructed sluicebox and rocker boxes to separate the gold from the paydirt. But Interior Alaska’s goldfields were far different from those of the Klondike, where gold was found relatively close to the surface. Alaska’s precious metal was often buried under twenty feet of frozen silt and muck. Wood fires and later steam points were used to thaw the ground. Preswww.akbizmag.com

Photo courtesy of Usibelli Coal Mine

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Alaska Business Monthly | September 2013

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surized hoses were aimed at the hills to wash away the overburden. Later, huge dredges were brought in to sift every possible ounce of gold from the valleys. Today, most small to mid-size placer miners use Caterpillar D8 or D9 bulldozers to move earth, says Marty Williams, who has been a product support representative for thirty years at N C Machinery in Fairbanks. Even those have changed over the years, he says. “Like automobiles, they’re more environmentally friendly, more green,” says Williams. “They’re much more complex. Most of them are equipped with computers.” Even the oils and lubrication agents are improved. He sees a lot of that change how the equipment runs in the winters, which often see temperatures of forty to sixty degrees below zero in Interior Alaska. “In the early ‘70s, our cars wouldn’t run very well when it got to forty below,” Williams says. That’s rarely a problem today, he notes.

Ace in the Hole At Usibelli Coal Mine in Healy, summer maintenance can often be more diﬃcult than for winter, says Bill Brophy, vice president of customer relations at Usibelli. “In the summer months, you have warmer temperatures, so engines and transmissions run at higher temperatures,” he says. The temperature of the tires is a major factor in performance and safety, Brophy notes. The condition of the roads is also a factor. In the summer months, roads can frequently get rutted or get a washboard effect, whereas in the winter months, the roads are essentially frozen and more stable. “Once they’re graded with a road grader, they’re just like a paved highway,” Brophy says. “They’re more comfortable for an operator and they’re more comfortable to travel.” Brophy likes to quote mine founder Joe Usibelli about the challenges of mining coal: “Mining coal is easy. Getting to it is the hard part.” The coal seams are layered under many feet of dirt and rock. Brophy says there are four basic ways of moving the overburden: ■ A bulldozer, which is used to push material short distances www.akbizmag.com

■ A shovel and a daisy chain of trucks, which are choreographed so that a truck is always ready for the load from the shovel, but neither is kept waiting ■ A drill rig and explosives, which are used to cast blast the material away from the seam ■ A dragline, which is Usibelli’s hallmark piece of equipment, affectionately nicknamed the “Ace in the Hole” by Healy schoolchildren The Ace in the Hole is a 1300W Bucyrus-Erie walking dragline that Usibelli purchased in 1977. It took N O R T H W E S T

twenty-six railcars and forty trucks to deliver the components of the machine to the mine site, where it took eleven months to assemble. It is the largest land-mobile machine in Alaska. Two operators are on duty at all times, one to operate the bucket and the other to perform needed maintenance or other duties. The dragline itself is powered by electricity. The bucket of the dragline holds thirty-three cubic yards of material and is used to remove overburden, not the coal. The addition of the walking dragline allowed Usibelli to ramp up production S T R A T E G I E S

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A view of the trucks at the Fort Knox mining site from the top of the pit helps show the scale of the mine.

in the 1980s and is an integral part of today’s operations, Brophy says. He notes that when the mine went into production in 1943, it was able to deliver 10,000 tons of coal to Ladd Field in Fairbanks over the course of a year. Today, because of the new technology, it can produce 10,000 tons in one day and more than 2 million tons per year. Among its ﬂeet of equipment are about nine bulldozers, fourteen loaders of different variations, three road graders, three drillers, and eight Caterpillar 785 trucks and three Caterpillar 777 trucks, which have a hauling capacity of 150 and 100 tons, respectively.

Large Fleet for Large Mine At Fort Knox, the ﬂeet is much larger, but so is the mine. The largest piece of equipment is the Hitachi 5600 shovel, 46

the cab of which is thirty-five to forty feet above the ground, says Derek Lakey, who is mobile maintenance senior planner at the mine. It is used in the pit to move the ore. A ﬂeet of trucks the size of two-story buildings moves the ore to the crusher or heap leach, depending on the grade of ore. The largest are Caterpillar 793s, capable of hauling a 240 ton load. Fort Knox has nineteen of those, the newest of which cost $4.2 million, Atchison says. They are supported by a ﬂeet of nine Caterpillar 789 trucks that can haul 190 tons and ten Caterpillar 785s that hold 150 tons apiece. “I’ve always equated them as driving like a great big boat, only taller,” Lakey says. “They’re really smooth, really comfortable to drive.” All of the trucks are equipped with

Alaska Business Monthly | September 2013

GPS and are monitored through a dispatch system that tells operators where the truck is going, where they came from, what they’re hauling, and what their speed is, Lakey says. A separate system is used for maintenance. “You can see in real time how much fuel they have, what their load is as far as weight,” he says. “We see problems way before it ever becomes a real issue. There’s just no other way to keep track of everything.” It’s all about eﬃciency, Lakey adds. “It organizes and optimizes your ﬂeet so you have the right amount of trucks at each shovel so you don’t have your shovel hanging and you don’t have your trucks waiting.” Drivers get eighty hours of training, some in classes, some with a customprogrammed simulator, and some onwww.akbizmag.com

Photo by Greg Martin for Kinross Fort Knox

A giant Hitachi is used to load another one of the nineteen Caterpillar 793D trucks, Fort Knox’s biggest.

site with a trainer, says Craig Natrop, Fort Knox mine superintendent. The simulator is also a way for drivers to test their responses to hazard scenarios

such as losing steering. Mainly, Natrop says, it’s a way to make sure drivers are using the machines properly and not inducing unnecessary maintenance.

Fort Knox uses two other unusual pieces of equipment: a D11 Caterpillar dozer and its gyratory crusher. The D11 is about twice the size of a normal bulldozer and is used on the heap-leach to break up the surface so the chemicals can leach through, Natrop says. The crusher, which was built in 1952, is the largest and oldest crusher in the country. It is used to break up the ore before it is sent to the mill and can handle about three thousand tons of ore an hour. Although the equipment it uses is enormous, Lakey said it helps Fort Knox keep its footprint much smaller than older mining methods would have. The maintenance and training operations are pivotal in maintaining a strong safety record, Natrop says. “That’s really what modern mining is all about,” Natrop says. “We’re safer. We’re more eﬃcient and we’re able to produce more. Those are some of the things we talk about the most, to make sure your people and the environment come first.”  Julie Stricker is a writer living near Fairbanks.

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September 2013 | Alaska Business Monthly

AGENDA

Compiled by Tasha Anderson

September

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Alaska Writers Conference

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September 7-8—Crowne Plaza, Anchorage: This conference features nationally acclaimed editors, agents, and authors, as well as local authors and illustrators. alaskawritersguild.com

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Arctic Science Conference September 26-28—Kodiak Harbor Convention Center, Kodiak: This year’s theme is, “Fisheries and Watersheds: Food Security, Education, and Sustainability.” The conference will feature a variety of sessions focusing on marine science, sustainability, circumpolar health, and interdisciplinary education. Contact: Brian Himelbloom bhhimelbloom@alaska.edu 907-486-1529, arcticaaas.org

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October 15—Fairbanks Westmark Hotel, Fairbanks: The state’s premier business conference. This year’s topics include healthcare reform and implementation, workers’ comp reform, grass roots advocacy, small business workshops, etc. alaskachamber.com October 18—The Alaska Native Heritage Center, Anchorage: Payroll training and networking event; payroll and finance vendor fair. alaskaapaconference.org

Native Knowledge: Respecting and Owning our Living Culture

Alaska CHARR Convention

■

October 1-3—Kodiak Harbor Convention Center, Kodiak: Annual convention Alaska Business Monthly | September 2013

October 21-23—Carlson Center, Fairbanks: Sponsored by the First Alaskans Institute, the conference stimulates dialogue between young people and Elders, and encourages the maintenance of traditional Native values and practices in a modern world. firstalaskans.org 907-677-1700, info@firstalaskans.org

October 25-28—Hotel Captain Cook, Anchorage: Annual conference of the Alaska Association of School Business Oﬃcials. alasbo.org

NWPPA/APA Alaska Electric Utility Conference

October 8-10—Sheldon Jackson Campus, Sitka: Gathering for Alaska’s tourism industry leaders with delegates from tour operators, wholesalers, Alaska vendors, destination marketing organizations, and elected oﬃcials. alaskatia.org October 9-11—Anchorage Marriott Downtown, Anchorage: Events include keynote speakers and training sessions. alaskahousing-homeless.org/conference

October 24-26—Carlson Center, Fairbanks: Annual gathering of Alaska Native peoples to discuss current news and events on a state, national, and international level. This year’s theme is “Traditional Family Values,” with keynote speaker Nelson Angapak. nativefederation.org 907-263-1307 agrohall@nativefederation.org.

ALASBO Annual Conference

October 28-30—Dena’ina Civic & Convention Center, Anchorage: This is the largest conference and trade show for public power utilities in Alaska, held every other year. It provides opportunities to learn about the latest practices, innovations, and technology in the electric utility industry through education sessions, a trade show, and networking. Contact: Gail Patterson 360-816-1450 gail@nwppa.org nwppa.org

November 2013

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Alaska Miners Association Annual Convention and Trade Show

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November 4-10 (trade show November 6-8)—Sheraton Hotel, Anchorage: Includes luncheons, banquets, keynote speakers, and short courses. Registration required. alaskaminers.org

Associated General Contractors of Alaska Annual Conference

Alaska Statewide Payroll Conference: The Great Land of Payroll

October 2013

■

October 7-11—Princess Lodge, Fairbanks: This year’s theme is, “The Practice of Fisheries: Celebrating all who work toward sustainable fisheries in Alaska.” afs-alaska.org

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Alaska Chamber Annual Fall Conference

Museums Alaska/Alaska Historical Society Joint Annual Conference September 25-28—Sheldon Museum, Haines: The conference includes workshops, volunteer opportunities, sessions, and keynote speakers. sheldonmuseum.org

October 7-9—Westmark Hotel and Conference Center, Fairbanks: A continuing medical education conference put on by the Alaska Academy of Physicians Assistants, providing up to 25 CMEs. akapa.org

October 21-24—Centennial Hall Convention Center, Juneau: This year’s theme is “The Future of Transit in Alaska.” act-dot.com

Alaska Federation of Natives Annual Convention

Alaska Coalition on Housing and Homelessness Conference

Alaska Fire Conference September 23-28—Marriott Hotel, Anchorage: The them is “Today’s Vision, Tomorrow’s Reality.” Includes training, workshops, lectures, and a firefighter competition. facebook.com/AlaskaFireConference

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Alaska Travel Industry Association Convention & Trade Show

ALA Region 5 Conference & Expo September 19-21—Egan Civic & Convention Center, Anchorage: The Association of Legal Administrators two-day regional conference providing an opportunity for intensive learning and networking experiences. Includes a silent auction which benefits Clare House. alanet.org

October 2—Dena’ina Civic & Convention Center, Anchorage: Come honor the top Alaskan-owned companies ranked by gross revenue at our annual luncheon. Contact: Melinda Schwab 907-276-4373 events@akbizmag.com akbizmag.com/store

Alaska Chapter of the American Fisheries Society Annual Meeting

AAR Convention September 17-21—Hotel Captain Cook, Anchorage: The Alaska Association of Realtors 2013 Convention theme is “No Excuses” and will be hosted by the Valley Board of Realtors. alaskarealtors.com/2011-convention/

Alaska Community Transit/ Department of Transportation Conference

All-Alaska Medical Conference

Arctic/Cold Regions Oil Pipeline Conference September 17-19—Dena’ina Civic & Convention Center, Anchorage: This conference will consist of presentations addressing the unique challenges associated with the construction and operation of pipelines in the Alaskan Arctic/Cold Regions. shannonwilson.com

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Alaska Business Monthly’s Top 49ers Luncheon

Alaska Oil and Gas Congress September 16-19—Anchorage Marriott Downtown, Anchorage: The Annual Alaska Oil and Gas Congress brings together oil and gas professionals from across the US, Canada, and abroad and is dedicated to updates on projects, policy, opportunities, and challenges in the oil and gas industry in Alaska. alaskaoilandgascongress.com

of the Alaska Cabaret, Hotel, Restaurant & Retailer’s Association. This year’s theme is “Strut Your Style on the Emerald Isle.” alaskacharr.com

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November 13-16—Anchorage: AGC of Alaska is a nonprofit construction trade association dedicated to improving the professional standards of the construction industry. agcak.org

Annual Local Government Conference

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November 18-22—Anchorage: A joint conference of the Alaska Municipal League and the Alaska Conference of Mayors. akml.org

RDC Annual Conference: Alaska Resources November 20-21 — The conference provides timely updates on projects and prospects, addresses key issues and challenges, and considers the implications of state and federal policies on Alaska oil and gas, mining, and other resource development sectors. akrdc.org  www.akbizmag.com

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OIL & GAS

Cook Inlet exploration is busy Buccaneer, Furie test new gas discoveries By Mike Bradner

Spartan Offshore Drilling’s jack-up Rig 151 in winter layup at Port Graham in April before heading out to work in Cook Inlet for Furie.

ook Inlet is a busy place this year for oil and gas explorers. Two independent companies, Buccaneer Energy LLC and Furie Operating Alaska, are drilling offshore exploration wells, and Buccaneer is also drilling onshore on the Kenai Peninsula. Hilcorp Energy is meanwhile busy with its ongoing redevelopment of existing, and mature, oil and gas fields acquired from Chevron Corporation and Marathon Oil Co. Hilcorp is drilling new wells, rehabilitating old ones, and adding reserves to the aging fields. The company now has enough new gas that it has signed contracts to supply additional gas to three utilities in Southcentral Alaska: Chugach Electric Association, Enstar Natural Gas Co., and Matanuska Electric Association.

The contracts are before the Regulatory Commission of Alaska for review. A fourth utility serving Southcentral, Anchorage’s city-owned Municipal Light and Power, supplies its own gas from its one-third ownership of the Beluga gas field, which is on the west side of Cook Inlet. Municipal Light and Power says its gas supplies are suﬃcient for now, but it will be in the market in the future as production from the Beluga field declines. ConocoPhillips and Hilcorp are the other two owners at Beluga. Hilcorp’s signing of the utility contracts, which will supply gas into the first quarter of 2018, has raised concerns for new gas being discovered by the independents. With the ConocoPhillips natural gas liquefaction (LNG) plant near Ke-

Alaska Business Monthly | September 2013

nai shut down, for now, and Agrium Corporation’s fertilizer plant also near Kenai shut down since 2007, the only available markets for new gas discovered are the regional utilities. Both Buccaneer and Furie have discovered new gas, and the companies have both tested their wells in the summer of 2013—the results are not yet available—but Buccaneer, for one, has expressed concern that with Hilcorp having locked up the available utility market, there may be no place to sell new gas. Ironically, the state of Alaska is heavily subsidizing the Cook Inlet gas exploration. Through a special set of exploration tax credits the state directly finances about two-thirds of the cost of the exploration drilling. www.akbizmag.com

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Possible Solution One solution to the problem would be a reopening of the big industrial plants as customers for gas producers, either the ConocoPhillips LNG plant or Agrium’s fertilizer plant. ConocoPhillips is maintaining its plant in a condition that it can be restarted, the company has said, but has made no announcements as to future plans. Agrium, meanwhile, has a technical team, supplied mostly by contractors, at work at the Kenai fertilizer plant working through the summer and fall of 2013. The team, led by Arctic Slope Energy Services, is assessing the condition of plant equipment so as to be in a better position to decide on a restart. The big uncertainty facing Agrium, and for ConocoPhillips at the LNG plant, is whether there will be enough new gas available—and at an affordable price—to operate the plants. People familiar with the projects say Agrium needs about 80 million cubic feet a day of gas supply to restart one of the two urea fertilizer and ammonia units at the plant. ConocoPhillips hasn’t said how much gas it would need, but reports are that it might be an amount

Another view of Spartan Offshore Drilling’s jackup Rig 151 in winter layup at Port Graham. © Spartan Offshore Drilling

twice that required for Agrium, in the range of 150 million cubic feet per day. Another potential industrial customer for Cook Inlet gas is Donlin Gold, the joint-venture company working in development of a large gold mine at Donlin Creek, about 250 miles west of Anchorage near the Kuskokwim River. Donlin Gold, owned by Barrick Gold and NovaGold Resources, needs a large energy source for mine operations. Generating power with diesel on-site will be

Alaska Business Monthly | September 2013

very expensive, so the company is looking to import gas from Cook Inlet though a fourteen-inch gas pipeline built from the Matanuska-Susitna Borough. A supplier of gas would also have to be located. However, the company wouldn’t need gas until after 2018, however, because it will still take time to secure permits and for construction, and in any event the companies have not yet made a decision to actually build the mine. Another big potential customer is the proposed Pebble

www.akbizmag.com

mine near Iliamna, which is in a stage of advanced planning. Like Donlin, Pebble would not be built for several years because of the time needed for permitting, likely litigation, and then construction.

New Oil If the markets for natural gas are uncertain, there’s no uncertainly about new Cook Inlet oil. All the new companies working in Cook Inlet including Buccaneer, Furie, Hilcorp, and Cook Inlet Energy, another independent working on the west side of the Inlet, are focused on developing oil as well as gas because of the high value of crude oil. Cook Inlet Energy has been redeveloping wells on the Osprey platform, at the small Redoubt Shoal offshore oil field on the west side, along with onshore wells at the producing West MacArthur River. Cook Inlet also has an active, long-term exploration program focused on its leases on the west side and the nearby Susitna River valley, exploring mainly for gas. Apache Corporation, a large independent that has been exploring in the Inlet in recent years, has a long-term regional

evaluation program underway that will involve the first 3D seismic mapping of the region. Much of the early seismic in the Inlet has been done with older twodimensional seismic, but 3D seismic is a much more advanced technique that will allow for a more complete picture of oil and gas potential. Apache has also drilled an onshore exploration well near the Tyonek village on the Inlet’s west side. Results have not been announced. Armstrong Oil and Gas is a Denver independent that is known for its work on the North Slope. Armstrong has developed the small North Fork gas field east of Anchor Point, on the Kenai Peninsula, and is now supplying gas to Enstar Natural Gas. The company plans more work in the area. The south Kenai Peninsula area around Homer and Anchor Point, in the same region where Armstrong is producing, has also emerged as a focus of interest for Hilcorp. Hilcorp is producing gas from its “Red Pad” east of Anchor Point, a discovery made several years ago by Unocal Corporation, its former owner, but only developed

recently by Hilcorp. The company is interested in further development in the area and has acquired new leases in recent state lease sales. Buccaneer, aside from its offshore drilling, is also interested in the south Kenai Peninsula to drill its West Eagle gas exploration well east of Homer in September. Buccaneer is meanwhile doing further drilling of a producing onshore field near the city of Kenai, its Kenai Loop field. Two wells are producing now, with the gas being sold to Enstar Natural Gas, and a third production well is to be completed in August. What is significant about Buccaneer at Kenai Loop is that the company made this new gas discovery in a location one mile from a long-producing gas field, the Cannery Loop field that was operated by Marathon Oil (and now now Hilcorp). Kenai Loop illustrates the potential of the region, that there are prospects long overlooked by the larger companies that are being seized by smaller companies that can bring new technology and fresh ideas to the table. Nowhere is this idea being put to work more than in offshore Cook Inlet.

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September 2013 | Alaska Business Monthly

Sites Revisited Both Furie and Buccaneer are very active in exploring prospects previously known, and even drilled, in the early days of Cook Inlet. Furie is privately-held and is very tightlipped about its operations and any results from drilling so far, but it is known that the company made what could be a significant new gas discovery at its Kitchen Light Unit, which is near the North Cook Inlet gas field that has been produced for years by ConocoPhillips. Furie drilled a discovery well with a jack-up rig, the Spartan 151, in fall 2011, but was unable to fully test the well because of the onset of winter. The company returned with the Spartan 151 in 2012 to drill another exploration well nearby and then again in 2013 to drill a well designed to test the gas reservoir discovered in 2011. A gas production test was done, but Furie has not announced results. Meanwhile the company continues to explore for possible oil deposits that are deeper than the gas that has been found so far. Furie is also in the early stages of securing permits for a small platform that would support production operations. Buccaneer has also done extensive tests at its Cosmo No. 1 exploration well just offshore Anchor Point. This is a previously-drilled prospect by former owners ARCO Alaska and Pioneer Natural Resources that was acquired by Buccaneer and its partner, BlueCrest Energy of Fort Worth, Texas. Buccaneer is a public company listed on the Australia stock exchange, so the company publishes the results of its drilling. While it can’t yet be said that Cosmo can be developed, Buccaneer has found more oil, as well as gas, than was previously discovered in a shallower reservoir. That reservoir could only be tested because Buccaneer used a jack-up rig, the Endeavour, that could drill vertical, or staight-down, wells at the site. ARCO and Pioneer had previously drilled lateral “high angle” wells from a rig on shore and were only able to test the lower reservoir formations at the well, partly because of the high angles the wells had to be drilled at.  Mike Bradner is publisher of the Alaska Legislative Digest. 54

Alaska Business Monthly | September 2013

www.akbizmag.com

OIL & GAS

The MidMajors These oil companies, big but not giant, are making strides in Alaska By Wesley Loy

ometimes it seems only two types of oil companies attract all the attention in Alaska—the giants such as BP, ConocoPhillips, and ExxonMobil, and the scrappy pocket players like Aurora, Furie, Great Bear, and Brooks Range Petroleum. It’s a class of companies in the middle, big but hardly household names, that might offer the best hope for sustaining Alaska as a serious oil producer. Already, these mid-sized companies—we’ll borrow some college basketball slang and call them midmajors—have notched impressive accomplishments in the state. Two mid-majors, Pioneer Natural Resources and Eni, have become oil producers on the North Slope. That’s remarkable, because for the first three decades of North Slope production, only two companies, BP and ConocoPhillips, operated oil fields there. That’s right, just two. In Cook Inlet, the state’s older but smaller oil patch, another mid-major, Hilcorp, has risen rapidly to become the basin’s dominant oil and gas producer, having bought out the local assets of two better known companies, Chevron and Marathon. These three mid-majors could signal an emerging, and not necessarily bad, transition for Alaska as it begins to gray 56

Alaska Business Monthly | September 2013

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as an oil state. The biggest of oil companies prefer to pursue giant fields around the globe. When they leave a mature area, second-tier companies move in. Industry observers say this changing of the guard can be good, as smaller companies can devote more attention to old fields or small prospects that don’t appeal to the supermajors. That’s not to say BP, ConocoPhillips, and ExxonMobil are bugging out of Alaska anytime soon. BP in particular, as operator of Alaska’s largest field at Prudhoe Bay, has insisted over the years that it plans to be in Alaska for a long time to come. Still, speculation has ﬂared up repeatedly over the years that BP might be selling its stake in Prudhoe and other North Slope fields, especially after the Deepwater Horizon disaster in 2010 prompted the company to divest billions of dollars in assets to raise cash. One other midmajor now actively exploring in Alaska, Apache, was widely speculated as a potential buyer of BP’s Prudhoe stake. That deal never materialized. But mid-majors are making plenty of concrete progress in Alaska.

Pioneer and Eni are running North Slope oil fields that combined for an average of more than 20,000 barrels of oil per day during the month of May, according to figures from the Alaska Oil and Gas Conservation Commission. That’s only about 4 percent of the 535,000 barrels per day the North Slope averaged overall in May. But the more significant point is more companies are beginning to emerge as producers on the Slope, a place once considered too forbidding for all but the industry titans. Here’s a look at the mid-majors, what they’ve done so far, and what they’re planning.

Pioneer’s Trailblazing Achievement Based in Irving, Texas, Pioneer Natural Resources is a large “independent,” meaning it concentrates on exploring and producing oil and gas and doesn’t also run refineries or retail gas stations, the way an integrated giant such as BP does. Pioneer is listed on the New York Stock Exchange and reported proved reserves of 1.1 billion barrels of oil equivalent at the end of 2012. Most of

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September 2013 | Alaska Business Monthly

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its production comes from the Permian basin and the Eagle Ford shale in Texas, plus the Raton field in Colorado. The company earned distinction as the first independent to operate a producing field on the North Slope, achieving first oil in 2008 from its Oooguruk field in the Beaufort Sea northwest of the huge Kuparuk field. Oooguruk (an Iñupiaq word for bearded seal) operates on a companybuilt gravel island five miles offshore, in about five feet of water. Oil from Oooguruk is piped to the ConocoPhillips-operated Kuparuk field for processing. Pioneer owns about 71 percent of the Oooguruk unit, with Eni and others holding the rest. Oooguruk averaged 8,255 barrels per day in May and has produced more than 13 million barrels of crude over its lifetime. The state in 2006 made a major concession to spur development of Oooguruk, agreeing to take a smaller cut of the oil as a royalty share to improve the field’s economics. So far, Pioneer has drilled about thirty wells to develop Oooguruk. Recently, the company reported exciting results after conducting some of the largest hydraulic fracture stimulations ever done on the North Slope. Pioneer is considering an expansion of the Oooguruk field with a project called Nuna. This would involve extended-reach drilling from a new, onshore drill site. In a May 28 filing with the US Securities and Exchange Commission, Pioneer said it planned Alaska capital spending of $190 million in 2013. Speculation has arisen about Pioneer possibly selling Oooguruk. Company executives have suggested they’ll keep it if the field shows enough growth potential.

Eni, an Italian Heavyweight In truth, it might be a stretch to call Eni a mid-major. It’s a huge, integrated energy operator, one of Italy’s largest companies. In fact, the Italian government owns 30 percent of Eni. The Rome-based company had proved reserves of 7.2 billion barrels of oil equivalent in 2012 and produced an average of 1.6 million barrels per day, triple Alaska’s total output. www.akbizmag.com

Much of Eni’s production is in Africa. Its US production comes mostly out of the Gulf of Mexico. Eni launched as an Alaska producer in 2011 with startup of the Nikaitchuq field. Nikaitchuq means “to persevere.” Eni assumed full ownership of the field in 2007, acquiring Kerr-McGee’s 70 percent stake. To support development, the state granted royalty relief to Eni, with the relief designed to kick in only during times of low oil prices. Nikaitchuq was described as a “marginal” field because of the heavy, or sticky, nature of its crude oil, plus the field’s challenging location. Eni now operates quite a complex at Nikaitchuq, located in the Beaufort Sea east of Pioneer’s Oooguruk field. Eni took a took a very different approach from Pioneer. Rather than rely on a big, established operator such as ConocoPhillips to separate water and gas from its crude oil, Eni chose to install its own processing facility. Building Nikaitchuq was a big undertaking that including fabricating enormous process modules in Louisiana, then hauling them to the North Slope by sealift. The Nikaitchuq complex includes the Spy Island offshore drill site, an onshore drilling and processing pad on Oliktok Point, another onshore pad for worker housing and operations support, and a fourteen-mile pipeline connecting with the main North Slope oil pipeline network. Nikaitchuq averaged 11,926 barrels of oil per day in May, with total production of around 7 million barrels thus far. Eni has big plans to further develop Nikaitchuq. It continues to drill new production wells, including sophisticated wells with multiple drainage legs or “laterals” that branch off the main wellbore. In a plan of development submitted to the state in July, Eni said it’s considering a project to target a reservoir known as the N sand. The company also plans to submit a proposal to “upper management” for a second offshore drilling pad.

Hilcorp Storms Cook Inlet Hilcorp was a virtual unknown in Alaska before mid-2011, when the company agreed to buy Chevron’s collection of aging oil and gas assets in Cook Inlet. The deal included interests in several oil and gas fields and ten offshore platforms. In January of this year, Hilcorp www.akbizmag.com

September 2013 | Alaska Business Monthly

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wrapped up another big deal, acquiring Marathon Oil’s extensive Cook Inlet natural gas production, pipeline, and storage properties. That deal was significant enough to prompt a review by the Federal Trade Commission. While finding that the Marathon takeover could reduce competition, the FTC deferred to state oﬃcials who felt the deal might help alleviate the region’s looming gas shortage. Cook Inlet presented the ideal challenge for Hilcorp, which specializes in wringing more out of old fields. And certainly, Hilcorp has come into Alaska with great vigor, moving rapidly to boost production and establish itself as Cook Inlet’s dominant operator. The company generated serious buzz in July when state utility regulators said they were considering a huge, multiyear gas supply contract between Hilcorp and Chugach Electric Association, the state’s top power producer. “After closing the Marathon acquisition earlier this year we were able to get a better idea of what reserves were in place and make commitments accordingly,” said Hilcorp spokeswoman Lori Nelson. “In general, we’re simply managing the assets more aggressively and making the necessary investments to combat the decline curve and bring new resources online.” Hilcorp has the muscle to make things happen. Founded in 1989 and based in Houston, Hilcorp bills itself as the nation’s third-largest, privately held exploration and production company. Its chief executive, Jeffrey Hildebrand, is one of the world’s richest people, with Forbes magazine ranking him No. 219 on its billionaires list with a net worth of $5.5 billion. He’s a former Exxon man said to have made a fortune in the Eagle Ford shale. It hasn’t gone perfectly for Hilcorp in Alaska. The company this year paid a $115,500 civil penalty after state drilling regulators cited a string of violations, including failure to test blowout prevention equipment and inadequate worker training. Hilcorp says it has remedied those problems and is moving forward.  Wesley Loy is a journalist living in Anchorage. www.akbizmag.com

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OIL, GAS & FISCAL POLICY

The Alaska OCS and State Fiscal Policy By Bradford G. Keithley The opinions expressed herein are the author’s own.

ometimes state oﬃcials and other proponents argue that oil tax reform is needed to keep the Trans Alaska Pipeline System (TAPS) operational “until” oil from Shell Oil Company’s Chukchi Sea or other Alaska Outer Continental Shelf (OCS) projects come online in the 2020s. The implication is that once OCS oil is ﬂowing through TAPS, the state will be out of the proverbial fiscal woods and once again positioned to spend at the greatly escalated levels experienced over the last few years. The additional suggestion—made by some—is that, believing OCS production ultimately will save the day at the other end, maintaining high spending levels in the meantime is acceptable as a “bridge,” even if it requires drawing down the state’s fiscal reserves. There are several reasons why this is bad fiscal policy, not the least of which is the highly speculative nature of the ultimate timing and level, if not the existence, of OCS production. Shell’s Alaska OCS experience thus far is not a confidence builder. If the Alaska OCS projects are delayed or, worse yet, deferred until a future generation, the “bridge” visualized by interim spending easily could become a fiscal “bridge to nowhere.” More important, however, is the fact that, even if the exploration and development of OCS oil goes smoothly from this point forward and production begins to reach TAPS sometime in the 2020s, Alaska state government will receive relatively little from the OCS revenue stream. In fact, current estimates are, even assuming the best possible outcomes, that the net present value of the state’s total, lifetime take from anticipated OCS development, spread over decades, will barely cover two years of state spending at current rates. 62

‘Government Take’ from OCS Production As a result of the ongoing debate over oil taxes, Alaskans are becoming increasingly familiar with the phrase “government take” when talking about oil revenues. As used in the oil tax debate, government take generally means the percent of oil company gross profits (revenues minus costs) that ultimately are paid to government. The government’s share usually is the sum of state or federal royalties plus federal and state income and production and property taxes. The governmental recipient of the revenues varies depending on the location of the production. The Prudhoe Bay field, for example, is located entirely within the geographical boundaries of the State of Alaska and on state lands. As a result, the state receives both the royalty share (because the oil is produced from state lands) and most production, income, and property taxes (because Prudhoe is located within the state). The federal government’s share of the profits is limited to the portion paid as federal income tax. The governmental revenue split changes, however, when production is from federal lands. For example, the federal government owns the lands located in the National Petroleum Reserve-Alaska. As a result, royalty from those lands is paid to the federal government. Alaska receives a share of the revenue from any oil produced from the area only through the state’s production, income, and property taxes (because the production still is from within the state). While important onshore, the differences between federal and state lands becomes even more important when discussing offshore production. Offshore, Alaska’s geographical boundary ends three miles from the shoreline. Up to that point, all offshore government take, except for federal income taxes, goes to the state.

Alaska Business Monthly | September 2013

Beyond that point, however, the rules change significantly. The area beyond the three mile limit is entirely the province of the federal government. That is important because the state’s taxing power does not apply beyond the three-mile limit. As a result, with the small exception noted below, beyond the three-mile limit the state generally receives no share of oil production revenue. Sometimes as a result of federal law, Alaska shares in the royalty from federal lands. If there ever is production from the Alaska National Wildlife Refuge, for example, under federal law the state will be entitled to receive one-half of the royalties received by the federal government. Federal law provides for a similar split of some of the royalties received from offshore Alaska. But the split is smaller and the area is confined. The state receives 27 percent of the royalties received by the federal government for any production located between three to six miles from the shoreline. Beyond six miles—and Shell’s Beaufort and Chukchi Sea prospects are located eighteen and seventy miles offshore, respectively—the state receives no direct share, no royalty share, no production taxes, no income taxes, and no property taxes. All government take goes to the federal government.

The Indirect Effect is Limited Some argue that even though the state doesn’t receive any direct benefit from Alaska OCS production, it will receive significant indirect benefits. A 2011 study for Shell by Anchorage-based consulting firm Northern Economics and the University of Alaska Anchorage Institute for Social and Economics Research attempted to measure those. The study analyzed a number of possible knock-on effects from Alaska OCS development that would benefit the state. A few are direct. For example, assuming www.akbizmag.com

In the end, however, the total additional benefit to the state estimated by the study remains comparatively small. that development does occur and the oil is brought onshore, there will be some related property located onshore that will be within the state’s taxing purview. But the revenue potential to the state from those facilities is extremely small. According to the study, the state will realize only an aggregate of $296 million in property taxes from onshore properties related to OCS production over the entire fifty-year period covered by the study. By far the largest category of benefits estimated by the study are the so-called “indirect revenues” arising out of the effect of OCS oil production on TAPS. As background, the per barrel rate charged by TAPS is calculated generally by dividing total costs by total throughput. Because costs are relatively fixed, the greater the throughput on TAPS, the lower the charge per barrel. The study reasonably assumes that the addition of OCS production to TAPS will increase overall throughput, reducing the charge per barrel that TAPS otherwise would charge. From this, the study identifies a number of additional benefits. For example, by reducing the transportation cost component used in the calculation of royalty and taxes, the study assumes that the level of royalties and taxes retained by the state from production on state lands will rise. The study further assumes that, due to the reduction in overall cost, marginal production levels on state lands may rise over time as transportation costs are reduced. In the end, however, the total additional benefit to the state estimated by the study remains comparatively small. The study estimates that the state may realize an aggregate $15.3 billion in such additional incremental benefits over the entire fifty-year period covered by the study. This fifty-year number may seem large at first glance, but pales when compared to the $6.8 billion annual budget which the governor recently announced as his fiscal plan for the next five years. At that rate, the total benefit to the state from fifty years of Alaska OCS production will be entirely consumed in slightly over two years of state spending. www.akbizmag.com

Federal Royalty Sharing: The Cavalry Isn’t Over the Hill Some argue that state revenues—and thus, in their view, state spending— also will be bailed out ultimately by a decision from the federal government to share with the state a greater portion of the federal government’s oil and gas royalties from the Alaska OCS. Supporters cite as precedent the 2006 decision by Congress to share federal OCS royalty revenue with the Gulf Coast states of Texas, Louisiana, Alabama, and Mississippi. But that precedent is very limited. As contemporaneous accounts make clear, that decision was based largely on the widespread regional devastation caused by Hurricane Katrina and the region’s need for funds to deal with that and similar future events. As Louisiana Senator Mary Landrieu said at the time, Congress “agreed to the bill because they recognized that a dedicated stream of revenue is necessary for Louisiana to protect itself from future storms. Katrina and Rita showed us what devastation can ensue if our communities remain vulnerable.” As importantly, the legislation was not simply a grant from the federal budget to the state general revenue fund. The money came with significant conditions, including an obligation to spend the funds on projects associated with “wetlands restoration, hurricane protection, and ﬂood control.” It is true that since 2006, most coastal states, including Alaska, have worked to expand the concept to other areas and to increase the royalty percentage being shared. But without a disaster to propel the legislation, the efforts consistently have stalled in Congress. Moreover, since 2006 attention by Congress has increasingly turned to fiscal issues, including the federal budget deficit. Oil, gas, and other mineral royalties constitute the second largest source of federal revenue after the income tax. While understandably a priority of some coastal states, it is diﬃcult to visualize Congress as a whole adding to the federal deficit by reducing the federal government’s share of a significant revenue source.

Finally, even if Congress did reach such a decision, the most likely outcome for Alaska would be simply to mimic the decision already reached for the Gulf Coast states, which is to share 37.5 percent of the federal OCS royalty revenues. Assuming most Alaska OCS leases provide in the range of a 15 percent royalty, this would dedicate only a little over 5.5 percent of the total Alaska OCS revenue stream to the state, well below the revenue levels currently realized by the state from onshore production.

Significant State Spending Cuts are Needed This is not to say that Alaska OCS exploration and development do not benefit individual Alaskans. In a previous 2009 study for Shell, Northern Economics and Institute for Social and Economics Research found that “Alaska OCS development could generate an annual average of thirty-five thousand jobs over the next fifty years—a 6 percent increase compared to total statewide employment without OCS development,” representing “a total payroll of $72 billion (2007 dollars) over the fifty-year period.” But unlike in other states, jobs in Alaska do not translate into state revenues. Because Alaska does not have state-level income, property, or sales tax, any benefits ﬂowing to individual Alaskans are not shared with the state. Instead, those individual benefits are retained privately. As a result, as much as some hope for it, Alaska OCS development will not be a savior for current state spending levels. Instead, significant cuts in spending will be needed to keep pace with anticipated future, onshore revenue levels. 

Bradford G. Keithley is the President and a Principal with Keithley Consulting, LLC, an Alaska-based and focused oil, gas, and ﬁscal policy consultancy he founded. Keithley also publishes the blog, “Thoughts on Alaska Oil & Gas” at bgkeithley.com.

September 2013 | Alaska Business Monthly

OIL & GAS

Don’t Miss the Alaska Oil & Gas Congress Event offers a wealth of timely information Compiled by Tasha Anderson

he oil and gas industry has been, and will continue to be, a huge part of and inﬂuence on Alaska business. With changes in industry technology, legislation, and worldwide attention to oil and gas production, the Ninth Annual Oil and Gas Congress is a timely wealth of information for large and small business owners and decision makers. It is September 16 through 19 at the Anchorage Marriott Downtown. This year’s theme is “Advancing Alaska as a Global Competitor” and examines “industry and legislative efforts to increase Alaska’s profile as a destination for energy development.” The Congress will help attendees with strategies to increase business competitiveness in North American energy markets; get updates on pipeline developments and how oil and gas are moving; and examine federal regulatory developments for Arctic projects both offshore and on. New this year, participants will have access to information about new opportunities in global natural gas markets; hear success stories from the Bakken region and Texas; and get information about developments from the Alaska Legislature. They will have access to representatives from oil and natural gas companies, government, power companies, law firms, manufacturing and construction businesses, Native and aboriginal groups, engineering firms, transportation companies, and environmental firms.

Monday, September 16 Monday is the “Alaskan Critical InState Energy Summit,” entirely devoted to Alaska’s in-state needs. The day will open with remarks from Drue Pearce, Senior Policy Advisor for Crowell & Morin LLP. There will be three presentations on natural gas: one about where gas will be coming from in the near future to supply Alaska’s domestic gas needs, one about the amount of natural gas needed to keep Alaska utilities aﬂoat, and the last about the North Slope LNG trucking project. The final presentation in the morning is an update about the Susitna-Watana hy64

dro project and its future. After a break for lunch, the presentations will cover importing natural gas to cover domestic needs, a look into how Alaska mines may plan to fulfill their energy needs, and an examination of the All Alaska Energy project. Following the final presentation at 4 p.m., there will be a welcome cocktail reception and early registration.

Tuesday, September 17 Tuesday is the first official day of the conference and opens with remarks from conference chairs Dave Harbour, Commissioner Emeritus of the National Association of Regulatory Commissioners and Publisher of Northern Gas Pipelines, and Charlotte E. Brower, Mayor, North Slope Borough. Following their remarks will be a welcoming address by Anchorage Mayor Dan Sullivan and then a keynote address by David Holt, President of Consumer Energy Alliance. The day’s other presentations include: ■ An overview of three distinct, competing proposals on how to commercialize North Slope gas; ■ Two presentations on the effects of federal law, one specifically about export law and its potential to affect an Alaska gasline project and the other on on- and off-shore federal policy; ■ A panel exploring realistic outcomes for development of pipeline and other energy alternatives; ■ Two presentations on the Alaska Legislature—one examining Alaska’s new tax regime and the other from the Legislature’s perspective about its initiatives to increase state competitiveness; ■ A presentation examining opportunities to export to Japan; ■ And an inspection of opening development, trade routes, and transportation in the Arctic to increase Alaska’s competitiveness. The day also includes keynote speakers Consul Akira Iwanade from the Consular Office of Japan (Alaska) and Rear Admiral Thomas P. Ostebo, Commander of the 17th Coast Guard District, US Coast Guard.

Alaska Business Monthly | September 2013

Wednesday, September 18 Wednesday opens again with remarks from conference chairs; before lunch are two presentations examining Outside projects—one about the Bakken formation in North Dakota and the other on the Eagle Ford and Permian formations in Texas—and what Alaska can learn and adopt from them. Before lunch, attendees will learn more about natural gas in Alaska: Alaska’s current energy reserves and it’s competitive position in the North American export market. Keynote speaker Senator Mark Begich will speak before lunch, and Commissioner of the Alaska Department of Natural Resources Dan Sullivan will give his address immediately after. Also after the lunch break there will updates on global LNG markets and the permitting process for oil and gas activity and a round table examining “Hot Topics” in Alaska. Thursday, September 19 Thursday’s agenda consists of two interactive seminars with Alaska fracking information. The first, led by Mohabbat Ahmadi, PhD, an assistant professor of Petroleum Engineering at the University of Alaska Fairbanks, will provide attendees with information to understand the fundamentals of exploration, fracking, and water usage. The second, led by Joe Christopher, Principal Wetlands Scientist for ASRC Energy Services and Jennifer Tobey, Project Manager/Cultural Resource Department Manager for ASRC Energy Services, will provide an understanding of Alaska regulatory framework for shale production to better produce a successful fracking program. No matter the business in Alaska, the Alaska Oil & Gas Congress is an unmatched opportunity to hear from experts and glean current, and forwardlooking, information about this vital Alaska industry. 

Tasha Anderson is the Editorial Assistant for Alaska Business Monthly. www.akbizmag.com

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OIL & GAS

Guide to Alaska Natural Gas Projects By Bill White

deas for moving Prudhoe Bay’s natural gas bounty off Alaska’s North Slope are as plentiful as cottonwood seed in the June air. Some are modest: Truck small amounts of gas to Fairbanks consumers. Some are epic: Pipe massive amounts to a Southcentral Alaska liquefied natural gas plant for LNG shipments to Asia — the most expensive North American private-sector construction project ever. Some are pinned to visions of an Alaska energy utopia, where gas for local use is plentiful and relatively cheap, the oil and gas industry develops new fields by the dozen, the state treasury overﬂows with wealth, and new industries sprout from the earth like wild lupine. Some are backed by tens or even hundreds of millions of state dollars to help design, engineer and otherwise prepare for construction. These include the big producer-led LNG project, a much more modest state-led pipeline to Southcentral Alaska and the Fairbanks truckedLNG project. Some are little more than a concept looking to catch on. The great North Slope oil discoveries of the 1960s and 1970s also found an estimated 35 trillion cubic feet of natural gas — almost one and a half times the entire volume of U.S. production in 2012. The U.S. Geological Survey estimates an additional 221 trillion cubic feet await discovery in Alaska’s Arctic, onshore and offshore. If only an economically viable way could be found to move the gas to consumers. Below we summarize several proposals — big and small — for transporting natural gas from Alaska’s North Slope.

LNG Export Project This would involve an approximately 800-mile mostly buried pipeline from the Prudhoe Bay field on Alaska’s North Slope to Southcentral Alaska, possibly Valdez, possibly Nikiski, or somewhere 66

2012 worldwide gas production, exports

69% 10% 21% Source: BP

■ Domestic produced/used (225 bcf/day)

■ Pipeline exports (68 bcf/day)

else along Cook Inlet or Prince William Sound. At the port, a plant would chill the gas to minus 260 degrees to create liquefied natural gas, or LNG, a compressed form of the gas that can be shipped on insulated tankers to markets worldwide. The 42-inch-diameter pipeline under consideration by the major North Slope producers would carry 3 billion to 3.5 billion cubic feet of natural gas per day. Alaskans would use some of this gas, and running the pipeline and LNG plant would consume some. The plant would make 15 million to 18 million metric tons a year of LNG, the equivalent of 2 billion to 2.4 billion cubic feet a day of gas. That would place it among the world’s largest LNG plants. SPONSORS: Three separate groups are discussing such an LNG export project. 1. ExxonMobil, ConocoPhillips and BP, the main North Slope producers, plus pipeline company TransCanada, in March 2012 said they are consider-

Alaska Business Monthly | September 2013

■ LNG exports (32 bcf/day)

Project Information Sponsors: ExxonMobil/BP/ ConocoPhillips/TransCanada Estimated cost: $45 billion to $65 billion (2012 dollars) Route: Parallel the trans-Alaska oil pipeline from Prudhoe Bay to the Fairbanks area. The route then could continue parallel to the oil pipeline to Valdez or possibly head to Nikiski or somewhere else in Cook Inlet. A large-scale gas liquefaction plant would be built at the tidewater location. Gas for Alaskans: The oil companies/TransCanada project would provide at least ﬁve points in Alaska from which spur pipelines could be built. Status: The oil companies/ TransCanada are assessing the viability of an LNG export project. www.akbizmag.com

ing a project to export LNG to Asia, where the gas currently can fetch a much higher price than in North America. They are in the early stages of considering this option. Two of the sponsors — ExxonMobil and TransCanada — in 2010 proposed to build a 48-inch buried pipeline to Valdez, with someone else constructing and operating an LNG plant there. They found insuﬃcient customer interest at that time to pursue the project. But the global LNG market has changed since then, and they have taken up the new LNG effort with ConocoPhillips and BP. 2. A Japanese company called Resources Energy Inc. is proposing an LNG plant in Southcentral Alaska that could start up in 2019 or 2020 and eventually produce 15 million to 20 million metric tons a year. The company was formed in late 2011 by Japan’s Hyogo Prefecture, a regional government, as well as other business interests and several small Japanese utilities affected by that nation’s nuclear power plant shutdowns fol-

lowing an earthquake and tsunami that year. REI said it completed feasibility studies in spring 2013 that cost $10 million to $20 million and verified its concept will work for supplying lower-cost LNG to Japanese utilities. REI would rely on others to produce the natural gas and build a pipeline from the North Slope to its plant. REI said it is working to find investors in its idea. 3. The Alaska Gasline Port Authority has proposed a government-owned Valdez LNG project. The port authority was formed in the late 1990s and is a joint venture of the Fairbanks North Star Borough and Valdez, two local governments along the pipeline route. In 2013, the U.S. Department of Energy dismissed the port authority’s application to export about 19 million metric tons of LNG annually from Valdez. In its letter, the department said the port authority had no natural gas under contract, no pipeline and no leased or committed site for an LNG plant. The port authority then issued a press release saying:

“We will continue to work with the Department of Energy on our export license application to satisfy the issues raised in its letter.” ESTIMATED COST: $45 billion to more than $65 billion (2012 dollars) for the producer-led project. ExxonMobil, ConocoPhillips, BP and TransCanada say their cost estimate would cover a pipeline from the Point Thomson gas field to Prudhoe Bay, a massive gas treatment plant at Prudhoe Bay, the roughly 800-mile pipeline to tidewater and compressor stations along the way, a liquefaction plant at a Southcentral Alaska site to be determined, LNG storage tanks and a tanker terminal. REI estimates the cost of its LNG plant and shipping terminal at $20 billion to $24 billion. Including a North Slope gas treatment plant and pipeline would bring total development costs to $38 billion to $45 billion, REI says, though it would prefer that someone else take the lead on those pieces. The port authority has no recent cost estimates for its concept.

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September 2013 | Alaska Business Monthly

STATUS: The North Slope producers and TransCanada are studying the commercial feasibility and preliminary design. TransCanada, on behalf of the project sponsors, conducted a nonbinding solicitation of interest Aug. 31 through Sept. 14, 2012, among producers, shippers, buyers and others in a possible LNG export project as well as a pipeline to North American markets.

Source: SCLNG

GAS FOR ALASKANS: The pipeline concept pursued by the oil producers and TransCanada would provide at least five points from which spur lines could be built to provide gas to Alaskans. This project involves only providing gas-takeoff points, not building the spur lines or local distribution pipelines, which would be up to the state, utilities or private companies. REI says gas could be taken for local use, but it does not propose any in-state distribution role for itself. The Alaska Gasline Port Authority says under its proposal gas could be taken from the pipeline at Fairbanks and that a spur line from Glennallen could provide gas to Southcentral Alaska.

A coastal Alaska LNG-export plant could look something like this illustration, provided by the South Central LNG project sponsors: ExxonMobil, BP, ConocoPhillips, and TransCanada.

TransCanada said it received interest from potential shippers and “major players from a broad range of industry sectors and geographic locations,” in-

cluding North America and Asia. It did not disclose further details. Under terms of the state’s Alaska Gasline Inducement Act license is-

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sued to TransCanada in 2008 and later amended, the state will reimburse the effort for 90 percent of early development work on the new LNG option. The state has not given the venture a deadline for filing to obtain government permits and other approvals for the LNG project. The four companies said they expect to have spent $80 million to $100 million on the LNG effort from spring 2012 to the end of 2013. Their limited 2013 field season includes work on the northern half of the proposed pipeline route to improve their data on fisheries, stream hydrology, water resources, wetlands mapping and other information they would need to apply for project permits. The team has volumes of other route information gathered in earlier, unsuccessful gas line efforts by the same sponsors. In late 2012, the companies estimated they would need at least three to five more years for a variety of activities in advance of a final investment decision to build the project. These activities include completing design and engineering; obtaining government permits;

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assessing and confirming the project’s commercial viability; and negotiating fiscal terms with Alaska state government. After a decision to build, construction would take five to six years, they estimated. REI believes it needs to start producing LNG by 2019 or 2020 to get to market before potential competing export projects elsewhere in the world. REI also says it hopes to deliver gas to Japan at under $10 per million Btu — far below current spot-market prices in Asia. REI says it brings gas buyers to the deal. The CEO in spring 2013 said the next step will involve assembling a coalition of Japanese investors to spend $50 million to $100 million on liquefaction plant engineering. To meet the 2019/2020 schedule, REI will need someone else to move quickly on the pipeline and North Slope gas treatment plant. The port authority continues to tout the LNG export idea in speeches, op-ed columns and interviews. Pluses: n Short-term economic boost to Alaska during construction.

n With the right project economics, long-term boost as billions of dollars in revenue flows to the state treasury, the Alaska Permanent Fund and local governments along the pipeline route. n Southcentral Alaska gets new industry based on LNG exports. n Outlet for natural gas now stranded on Alaska’s North Slope would spur oil and gas exploration. n Relatively inexpensive gas made available for heating and power generation in the Fairbanks area. n For Southcentral Alaska, the project likely provides a new, affordable source of natural gas to supplement Cook Inlet’s declining supplies. Problems: n A very expensive option. High cost makes project risky for lenders that would supply construction financing. n Federal loan guarantees from 2004 legislation are available only for a pipeline project that delivers gas to the Lower 48, not projects that would export gas. Lack of federal backing would raise borrowing costs.

September 2013 | Alaska Business Monthly

Pipeline to Alberta This proposal was active until 2012; considerable work was completed in the preceding years. The project conceived an approximately 1,700-mile, 48-inch buried pipeline from the Prudhoe Bay field on Alaska’s North Slope to the British ColumbiaAlberta border in Canada. From there, the gas could flow to the Lower 48 via an extensive network of existing pipelines. The gas pipeline would run parallel the trans-Alaska oil pipeline from Prudhoe Bay to Delta Junction, then continue into Canada roughly parallel to the Alaska Highway. The pipeline would move up to 4.5 billion cubic feet of gas per day. esTImATeD CosT: $32 billion to $41 billion (2009 dollars). sPoNsor: The Alaska Pipeline Project, a partnership of TransCanada and ExxonMobil. The team now is planning the pipeline portion of the North Slope producer-led LNG export project discussed above. sTATus: On hold, as North American shale-gas production has amply supplied the market and deflated prices. 70

U.S. dry gas production, 1936-2012 70 60

40 30 20 10 0 ‘36 ‘40 ‘44 ‘48 ‘52 ‘56 ‘60 ‘64 ‘68 ‘72 ‘76 ‘80 ‘84 ‘88 ‘92 ‘96 ‘00 ‘04 ‘08 ‘12

The Alaska Pipeline Project spent more than $300 million from the project onset through 2011. The sponsor put the project on hold in early 2012. Under the Alaska Gasline Inducement Act, the state is obligated to reimburse TransCanada for up to $500 million of its preconstruction costs. With TransCanada and ExxonMobil now considering LNG exports, the remaining balance of state reimbursements is available for eligible costs associated with that project. In January 2012, the sponsor filed with the Federal Energy Regulatory Commission volumes of data on fish, wildlife, soils, vegetation, cultural sites, air quality and other information that can be used for the environmental impact statement FERC would prepare. Much of that data also could be used for an EIS on the LNG-project pipeline, because some of the route in Alaska would be same as the route for an Alberta line.

Pipeline to southcentral A 737-mile, 36-inch buried pipeline from the Prudhoe Bay field on Alaska’s North Slope to the Big Lake area north of Anchorage. From there, the gas could flow to consumers, utilities and other industry via the local distribution pipelines of ENSTAR Natural Gas Co. The pipeline also would supply the Fairbanks area. The line would parallel the transAlaska oil pipeline from Prudhoe Bay to just north of Fairbanks, then continue south to Big Lake, roughly parallel to the Parks Highway.

Alaska Business Monthly | September 2013

The pipeline would move up to 500 million cubic feet of gas per day. The project also is known as the “bullet line,” the in-state line and the Alaska Stand Alone Pipeline, or ASAP. sPoNsor: Alaska Gasline Development Corp., a state agency the Legislature created in 2010. Some supporters say the state-led effort is a backup if the larger producer-led project stalls. Other supporters see it as the state controlling its energy future, rather than waiting for the major oil and gas producers to act. esTImATeD CosT: $5.4 billion to $10 billion (2012 dollars). Sponsor is using midpoint of $7.7 billion as a working number. The cost includes a gas treatment plant at the Prudhoe Bay field to remove propane, butane and other gas liquids as well as water, carbon dioxide and other impurities from the gas, then compress the gas before it enters the pipeline. The cost also includes a separate 35-mile spur line between the main pipeline and Fairbanks. Project cost does not include a local gas distribution network needed for Fairbanks. The local gas pipeline network already exists in much of Southcentral. GAs For AlAsKANs: Gas for Alaskans was the main idea when the state Legislature funded a feasibility study in 2010. www.akbizmag.com

Source: U.S. Energy Information Administration

Bcf per day

n Shippers must sign long-term commitments to use the pipeline and liquefaction plant (perhaps 15 or 20 years) and find long-term buyers for the gas in an Asia-Pacific LNG market that other exporters are targeting. Long-term contracts are needed to underpin financing. n Intense competition among LNG suppliers for Asia customers and prospects of weaker prices due to a buyers’ market in the years ahead. n North Slope producers want state of Alaska to set stable fiscal terms for gas production and the pipeline project. The politics of a fiscal deal could be contentious in Alaska. n Some Alaskans are frustrated about subsidizing early development costs for an uncertain project. n Fairbanks-area energy costs remain relatively high until pipeline is running. n Southcentral Alaska could need supplemental source of natural gas before pipeline is finished.

sTATus: The feasibility study issued in July 2011 provided a preliminary plan. In 2013, the Alaska Legislature appropriated about $355 million to continue design, permitting and commercial work. That’s in addition to $72 million in funding for 2010–2012. The Legislature in 2013 also granted the state gas pipeline corporation unlimited authority to issue bonds to pay for construction, with the restriction that the state is not legally or morally responsible for the debt. Bond buyers would be repaid from revenue collected from the pipeline’s customers, including utilities and large commercial customers.

n The project could deliver gas to Fairbanks and Southcentral before a larger pipeline to an LNG plant in Southcentral Alaska. n Assuming the pipeline operates at full capacity and preliminary construction-cost estimates hold true, Alaska’s Railbelt consumers could be assured of an affordable gas supply for decades. In Southcentral Alaska, the gas could supplement Cook Inlet supplies used for heating and power generation. Delivering natural gas to Fairbanks could greatly

lower that community’s high cost of energy. n The project might help resurrect the Kenai Peninsula LNG plant that exported gas from 1969 through 2012. It then shut down due to a lack of Cook Inlet gas supply. Problems: n Requires the state gas line corporation to issue billions of dollars in revenue bonds for construction, and could need direct state funding if the pipeline lacks enough customers

Project Information Sponsor: Alaska Gasline Development Corp. Estimated cost: $5.4 billion to $10 billion Route: Parallel the trans-Alaska oil pipeline from Prudhoe Bay to just north of Fairbanks, then continue south to Big Lake, roughly parallel to the Parks Highway. Gas for Alaskans: That is the main purpose of this proposal. Pipeline would supply Fairbanks and Southcentral. Status: Design, permitting work under way. Decision on building planned for 2016. ProPoseD TImelINe: 2013–2015 Project sponsor sharpens engineering and cost estimate, obtains permits. Early 2015: Customers solicited to ship gas on the pipeline, called an “open season.” Customer response will help determine the project’s economic viability. Early 2016: Final decision on whether to build project. 2016–2019: Construction. Late 2019: First gas flows to Fairbanks; 2020 gas flows to Southcentral Alaska. Pluses: n Short-term economic boost to Alaska during construction of multibilliondollar project. www.akbizmag.com

September 2013 | Alaska Business Monthly

to carry the full cost. The state Legislature would need to approve direct financial aid. n The construction cost estimate is soft until more engineering work is done. A much higher cost than the midpoint $7.7 billion estimate would alter the project economics. n Requires major gas shippers to make long-term commitments to use the pipeline. n The project would produce far less state revenue than a larger pipeline for an LNG export project due to the small volume of gas moved. n Requires the state to bear all of the pre-construction cost because no private developer will do so. n The cost of gas to Alaskans would be higher than gas from the larger LNG export project. n The project would not spark as much Arctic oil and gas exploration as the bigger pipeline. n The project relies on assumptions about customer demand that must come true to meet the pipeline rates and consumer prices predicted for the project. These include:

1) A major mine, such as the Donlin gold prospect in Western Alaska, will start up by 2019 and contract for a significant volume of gas down the line. 2) A utility or utilities will build a local gas distribution pipeline network in Fairbanks by the time the pipeline from Prudhoe Bay is ready. 3) Cook Inlet gas production will fall to such a point that power plants and the local gas utility in Southcentral Alaska will consume a lot of North Slope gas. 4) A revived liquefied natural gas export plant on the Kenai Peninsula or other large-volume industrial customer(s) will contract for much of the pipelineâ&#x20AC;&#x2122;s capacity.

Cook Inlet Gas Out of concern that aging Cook Inlet fields might not produce enough gas for local needs after doing so for nearly 50 years, two Anchorage electric utilities and a gas utility in 2011 jointly began considering the idea of importing lique-

Â ÂÂ&#x20AC;Â&#x20AC;Â&#x201A; Â Â&#x192; Â&#x201E; Â&#x2026; Â&#x201A; Â&#x192;Â&#x2020;Â&#x201A;Â&#x2021;Â&#x2C6;Â&#x192; Â&#x201E; Â&#x201A; Â&#x2030; Â&#x160; Â&#x192;Â Â&#x2C6;Â&#x201A;Â&#x2020; Â&#x160;Â&#x2039;Â&#x192;Â&#x201E;Â&#x2020;Â&#x192;Â&#x2021;Â&#x152; Â ÂÂ&#x201E;Â&#x2020; Â&#x2C6;Â Â&#x152;Â&#x201A; ÂÂ&#x201E;Â&#x2039;Â&#x2C6;Â&#x192;ÂÂ&#x2021; Â&#x2026; Â Â&#x2039; Â&#x2C6;ÂÂ&#x20AC; Â&#x2030;Â&#x192;Â&#x160;Â&#x201A; Â&#x152;Â&#x201E; Â&#x2030; Â&#x160; Â&#x192;Â Â&#x2C6;Â&#x192;ÂÂ&#x2021; Stressed skin urethane core panels successfully used for years in arctic conditions as components for foundations, walls, floors and roof structural panels.

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fied natural gas or compressed natural gas to Southcentral Alaska. Other utilities soon joined the effort. In particular, the utilities were concerned they didnâ&#x20AC;&#x2122;t have enough gas supply under contract for coming years. Since then, their sense of urgency has eased somewhat as Cook Inlet producers are stepping forward to offer increased gas production to cover the next several years. Also, in June 2011 the U.S. Geological Survey said the Cook Inlet region still holds an estimated 19 trillion cubic feet of natural gas that could be produced using current technology. Thatâ&#x20AC;&#x2122;s about double the total Cook Inlet gas production over the past 50 years. But how much of the gas could be produced profitably with current technology likely is a much smaller number, possibly as little as 10 percent. Separately in June 2011, the Alaska Division of Oil and Gas estimated that Cook Inlet alone could continue to profitably supply all of the regionâ&#x20AC;&#x2122;s natural gas needs until 2018â&#x20AC;&#x201C;2020, at which time supplemental supplies would be needed. The study said the gas industry must continue investing in the Inlet for this prediction to hold. The state Legislature in recent years has approved incentives to boost Cook Inlet gas exploration and production. New players include Furie Operating Alaska, which moved a jack-up rig to Cook Inlet and is drilling, Buccaneer Energy, which has a stake in a different jack-up rig partly owned by the state, and Hilcorp, which acquired Chevron and Marathonâ&#x20AC;&#x2122;s holdings in Cook Inlet and boosted development spending for oil and gas production. Hilcorp alone has said it expects to supply local utility gas needs through at least 2017 and has a pending contract to supply one utility into 2018. In 2010, state lawmakers passed tax credits and other incentives to encourage development of an underground gas storage facility on the Kenai Peninsula. The goal was to help utilities meet peak winter demand by storing surplus spring-and-summer production. Such a storage site opened in 2012.

Gas to Fairbanks by Truck or Pipe Ideas have been floated for getting North Slope natural gas to the Fairbanks area, 72

Alaska Business Monthly | September 2013

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where energy costs are much higher than in Southcentral Alaska and only a little natural gas is available, via truck deliveries from a privately owned LNG plant north of Anchorage. lNG TruCKeD To FAIrbANKs AreA: In 2013, the Alaska Legislature approved a $333 million cash-and-loan package requested by Gov. Sean Parnell for a small North Slope LNG plant as well as storage and distribution infrastructure in the state’s Interior. A year earlier, state lawmakers approved $30 million in tax credits for the LNG storage tanks the Fairbanks area would need to receive trucked deliveries.

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Gas for Alaskans: This project would bring gas only to the Fairbanks area initially. Status: $363 million state cashand-loan package available. AIDEA is soliciting for private investor /operator(s). With about $70 million of private money added, the Interior Energy Project, as the state named it, could total $430 million or so. This total would include building gas distribution pipelines in a limited area of the Fairbanks region; the state estimates expanding the grid could cost an additional $200 million. At the center of the funding is the Alaska Industrial Development and Export Authority, a state agency that supports economic development. AIDEA would use the 2013 $57.5 million cash appropriation for an equity stake in the LNG plant and perhaps other aspects of the project. AIDEA also is authorized to lend $125 million at a low interest rate and issue on the open market $150 million in other low-interest debt to raise money for the project. www.akbizmag.com

September 2013 | Alaska Business Monthly

Valley power plant and Flint Hills refinery are there.

Piped Natural Gas to Fairbanks Fairbanks Pipeline Co. started in 2010 and is proposing a 514-mile Prudhoe Bay-to-North Pole pipeline to deliver natural gas to Interior Alaska customers. Fairbanks Pipeline is owned by Energia Cura, a Fairbanks energy consulting and service business.

Project Information Contact information: Bill White, Researcher/Writer for the OFC (907) 271-5246 bwhite@arcticgas.gov OFC Washington, DC 1101 Pennsylvania Ave. NW, 7th Floor, Washinton, DC 20004 (202) 478-9750 The plan is for a private operator or operators to: n Build the small gas liquefaction plant on the North Slope. n Own and operate a fleet of LNG delivery trucks running between the plant and Fairbanks. The trucks were not included in the project’s cost estimate. n Build and operate aboveground LNG storage tanks. n Build and operate “regasification” equipment to warm the gas back into a vapor and feed it into a distribution grid for delivery to residences and businesses around Fairbanks. The LNG plant would be designed to process up to 9 billion cubic feet of gas a year — averaging 25 million cubic feet a day — slightly more than the forecasted Fairbanks-area demand 10 years after start-up (capacity would be greater than demand to accommodate seasonal swings in demand, AIDEA says). Potential customers include Golden Valley Electric Association, the Fair-

General Questions: info@arcticgas.gov OFC Alaska 188 W. Northern Lights Blvd., Suite 600, Anchorage, AK 99503 (907) 271-5209

For more information, please visit: www.arcticgas.gov banks-area electrical utility; Flint Hills Resources, owner/operator of a North Pole oil refinery outside Fairbanks; and Fairbanks Natural Gas, the small, privately owned local utility that trucks LNG from Southcentral Alaska and distributes the gas through a limited pipeline network. AIDEA says that if the project goes ahead, the first LNG could move to Fairbanks by late 2015 or early 2016. The AIDEA board is reviewing proposals and hopes to decide on a project operator in late 2013. In anticipation of more gas coming to town, the Fairbanks North Star Borough and the cities of Fairbanks and North Pole in 2012 created the Interior Gas Utility to handle gas distribution to an expanded service area. A potential complicating factor, state officials say, is that this new municipal utility and the existing private utility, Fairbanks Natural Gas, have competing applications for service in North Pole pending before the state utility commission. The North Pole population is only a little more than 2,000 people, but a Golden

Sponsor: Fairbanks Pipeline Company (Energia Cura) Estimated cost: $716 million Route: Prudhoe Bay to the Fairbanks area following state highways. Gas for Alaskans: This project would bring gas to the Fairbanks area, but sponsor says it could be expanded to supply extra gas for Southcentral. Status: Planning stage. The company said it is targeting Golden Valley Electric, military bases, trans-Alaska pipeline pump stations and mines, as well as Fairbanks Natural Gas, the small local gas utility. It has estimated the 12-inch buried pipeline would cost $716 million, delivering 52 million cubic feet of gas per day on average. The route would follow state highways. The Energia owners have funded costs so far. They hope others, including the state, possibly through its Permanent Fund oil-wealth savings account, Alaska Native corporations or other Alaska employers become owners.  Bill White is a researcher and writer for the Ofﬁce of the Federal Coordinator, Alaska Natural Gas Transportation Projects. Contact him at bwhite@arcticgas.gov. Federal Coordinator Larry Persily contributed to this article.

Reprinted from the Oﬃce of the Federal Coordinator, Alaska Natural Gas Transportation Projects website: www.arcticgas.gov, where it appeared in July. 74

Alaska Business Monthly | September 2013

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TRANSPORTATION

Arctic Shipping Changing routes, rules, and communities

Photo courtesy DFATD | MAECD

By Nicole A. Bonham Colby

Increased input from the business community operating in the Arctic was among topics addressed in May at the Arctic Council meeting in Kiruna, Sweden.

hen the international Arctic Council met last May in Kiruna, Sweden, industry and businesses operating in Alaska had a considerable stake in the outcome. Among the results of the summer meeting were legally binding procedures related to Arctic oil spills, and—perhaps most far-reaching of all—a snapshot of the member countries’ collective vision for development of the Arctic region going forward. For Alaskans, particularly those working in industries like maritime, transportation, and oil and gas, such

decisions made at high levels under that Swedish sunshine will likely flow down to tangible, on-the-ground impacts to operations. With Canada assuming the chairmanship of the Council at the close of the May meetings, North America now has a seat at the head of the table for the next two years. Among the current regime’s priorities is creating a Circumpolar Business Forum to involve industry in developing Arctic priorities. It’s a focus that will interest those who currently work in the Arctic regions—or those who look to support such polar

Alaska Business Monthly | September 2013

operations, such as the recently organized Ketchikan Marine Industry Council. While many of the past and present works of the Arctic Council focus on the environmental sciences—biodiversity, the ocean’s acidity, and pollution control to protect marine cultures—Canada’s Minister for the Arctic Council Leona Aglukkaq, an Inuk from Nunavut, appears to represent a shift in focus toward human needs and natural resource development. Her brochure circulated at the May meeting highlighted putting “Northerners first” with www.akbizmag.com

the incoming chair’s theme being, “Development for the people of the North” and a focus on safe shipping, responsible Arctic resource development, and sustainable circumpolar communities.

Changing landscape When the Arctic Council was created nearly two decades ago as a forum for collaboration among those countries sharing common Arctic polar geography, it was against a landscape—physical, political, and financial—much different than that of today. Organized by member countries as a result of the Ottawa Declaration of 1996, the council includes membership by Canada, Denmark, Finland, Iceland, Norway, Russia, Sweden, and the United States, including Arctic indigenous communities. In the years since its startup, the council has faced hot issues of marine biodiversity, the rise and fall of economies of members like Iceland and others, and—perhaps most high profile and of greatest impact—the spotlight of commerce northward as the Northern Passage increasingly becomes a viable shipping option.

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Canada’s Minister for the Arctic Council Leona Aglukkaq meets with ministers of the Arctic Council states in May in Kiruna, Sweden. Photo courtesy DFATD | MAECD

September 2013 | Alaska Business Monthly

Canada’s Minister for the Arctic Council Leona Aglukkaq meets with ministers of the Arctic Council states in May in Kiruna, Sweden. Photo courtesy DFATD | MAECD

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Alaska Business Monthly | September 2013

Of greatest interest going forward, members summarized their plans and expectations in “Vision for the Arctic,” a forward-looking statement adopted during the May meetings, which were attended by Secretary of State John Kerry and Alaska Senator Lisa Murkowski, among others from the United States delegation. “America became an Arctic nation only about 150 years ago, when another Secretary of State, William Seward, had the vision to purchase Alaska, dramatically changing not only our map but our choices, our landscape, our resources, and our identity as a nation,” Kerry told the Council, highlighting that Alaska constitutes the United States’s “in” to the high-stakes international body. “We truly are an Arctic Nation,” Murkowski later reported to the US Senate in a speech on the Senate floor following her return from Kiruna. “Our role as such, involved with other Arctic neighbors, is a growing role. And a role that the rest of the world is looking at with great interest, and great anticipation as to how the United States is going to step forward into this www.akbizmag.com

important arena.” It was Murkowski’s second Arctic Council. She first attended two years ago, which was also the first time a US Secretary of State attended the international council meeting, a move that created discussion of a burgeoning interest by the United States in its northern resources. “So why is this important? Yesterday, the chairmanship of the Arctic Council transferred from Sweden to Canada,” she said. “So our neighbors...will chair the Arctic Council for the next two years. In 2015, the gavel of that chairmanship will pass from Canada to the United States. So we will clearly be in a leadership role among the eight Arctic nations and those observer nations. So it’s critically important that we are ready.” Part of that readiness includes realization by the world that the Arctic is not just a barren landscape of ice and snow, Murkowski says. “Understand what is happening,” she told the Senate. “This is no longer an area that is locked in ice and snow, an area where we are not able to transit, an area where there is no human activity. The Arctic has seen clearly an opening as we see the sea ice receding, we’re seeing a level of activity that is unprecedented. It is truly the Last Frontier, a new frontier, so to speak. How we prepare for a world where there is more movement, more activity, is going to be a critical key to the success and the opportunities.” Specifically of interest is the increased level of activity ongoing today in the Arctic region due to industry. “We recognize that the volume of shipping that we are seeing now coming through the Northwest Passage, coming from Russia down through the Bering Straits, through the very narrow channels there, out to Asia and down into the Pacific—there is incredible movement,” Murkowski said. “How are we preparing ourselves for an increase volume of shipping traffic? Do we have the navigational aids that we need? Do we have the ports and the infrastructure that will be necessary? These are some of the initiatives that were discussed. How we map our resources—whether it’s our understanding the sea floor, whether it’s understanding the coast line. How we can be working cooperatively on things such as mapping?” www.akbizmag.com

Marine Oil Pollution Agreement The fifty-one-page “Agreement on Cooperation on Marine Oil Pollution Preparedness and Response in the Arctic” is intended to strengthen international cooperation between member countries as it relates to both preparedness and response concerning oil pollution in the marine environment. “There is a recognition that, in the Arctic where some 15 percent of the world’s known oil and gas reserves are situated, that there will be activ-

ity,” Murkowski told the Senate the day after the Kiruna meeting. “We are seeing it in Russia to our left-hand side; and in Canada to our ride-hand side. What we’re trying to do within the Arctic Council and other entities is to make sure that, when that happens, we are prepared. So we are putting forward collaboration and collective agreements so that there is an understanding that, in the event—hopefully a very, very unlikely event, something that would never happen—that there is an understanding about how all the

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September 2013 | Alaska Business Monthly

“The economic potential of the Arctic is enormous and its sustainable development is key to the region’s resilience and prosperity. Transparent and predictable rules and continued cooperation between Arctic States will spur economic development, trade, and investments... Economic cooperation will be on the top of our agenda.” —Arctic Council

nations act and the level of preparation that moves forward.” The agreement applies in Alaska above a southern limit defined as: Marine areas seaward of the coastal baseline from the border between the United States and Canada at the Beaufort Sea along the north side of the mainland of Alaska to the Aleutian Islands, above twenty-four nautical miles south of the Aleutian Islands, and, in the Bering Sea, east of the limits of the exclusive economic zone of the United States. In its various articles, the agreement addresses requirements for maintaining a national system to respond promptly and effectively to oil pollution incidents; related notification requirements; monitoring requirements; movement of resources across borders; requests for international assistance; reimbursement of associated costs; joint exercises and trainings; settlement of disputes between parties; and ongoing administration of the agreement.

Clear Vision A prosperous Arctic and a safe Arctic are identified as among key goals for the next two years of Canadian chairmanship of the Arctic Council. The eight member countries and six indigenous organizations drafted their intent for the Arctic region in a report published as the culmination of the May meeting in Sweden against a backdrop of heightening environmental concerns and increased scrutiny by the world’s business community. On prosperity, the Council agreed that, “The economic potential of the Arctic is enormous and its sustainable develop80

Alaska Business Monthly | September 2013

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ment is key to the region’s resilience and prosperity. Transparent and predictable rules and continued cooperation between Arctic States will spur economic development, trade, and investments... Economic cooperation will be on the top of our agenda,” the report states. On safety, shipping is mentioned again: “To meet the needs of an ever-changing Arctic we will further strengthen our cooperation in the fields of environmental and civil security. Aware that maritime safety requires broad regional and international cooperation, we will continue to develop best practices and other measures for the Arctic region.”

Sustainable Circumpolar Communities Perhaps one of the key developments of the May 2013 meeting was the upcoming focus to ensure that impacts to the Arctic region do not threaten the sustainability of its communities. According to the Canadian minister’s plan, “Canada has a clear vision for the Arctic, in which self-reliant individuals live in healthy, vital communities, man-

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age their own affairs, and shape their own destinies.” In addition to global awareness and protections for traditional ways of life of polar residents, the Council will recommend incorporating local knowledge and traditional knowledge into its research. Other areas of focus under the Sustainable Circumpolar Communities umbrella include mental health services and support of migratory bird conservation.

Responsible Arctic Resource Development For many, the Arctic Council and its committee reports may appear as a high-level, esoteric think-tank that seems removed from business—from the oil and gas companies already long working in the Arctic, from transporters and logistics companies traveling throughout the challenging geography of the far north, and even from those service providers seeking to edge a way into the market. As commerce increasingly comes to the northern polar region, the Arctic Council may change that image with its inclusion of industry-friendly initiatives.

Among those is the advent of the Circumpolar Business Forum, intended to invite industry to the table. The May meeting included creation of a new task force to create the Forum. “As the level of business activity amplifies within the region, industry is looking for ways to engage directly with key governance forums. In addition, several areas of work undertaken by the Council would benefit from a more direct linkage with the private sector,” according to the Senior Arctic Officials Report to Ministers delivered to the group in May. The initial focus of the forum will be responsible resource development. Canada’s chair will lead the forum, along with Iceland, Finland, and Russia. Each member of the forum may suggest representatives from the business community working in the Arctic to serve as an invited expert. The group’s first report to the Council is due by the end of the year, with scheduled forum launch by next February.

Safe Shipping With the Arctic and northern waters becoming a viable transportation alternative by shipping transporters, and with

September 2013 | Alaska Business Monthly

Photos by Kurtis R. Morin

From the commercial shipping sector, the Council will continue to encourage the International Maritime Organization to develop what it calls a “mandatory polar code” for the Arctic Ocean. That acknowledgement by the international body of increased shipping activity in the Arctic region is what has Alaska commercial operators particularly interested. One of those interested parties is the Ketchikan Marine Industry Council.

Ketchikan’s shipyard is the largest shipbuilding and repair facility in Alaska and is operated by Alaska Ship & Drydock, under ownership of Vigor Industrial. Ketchikan offers a dense “cluster” of marine-industry-related businesses that employ some 1,700 workers.

the public’s thirst for Arctic tourism not waning, the Arctic Council for 20132015 included the topic Safe Arctic Shipping as one of its priority areas of focus.

From the tourism standpoint, the body hopes to develop international guidelines for sustainable tourism and cruise-ship operations.

southeast’s eye on the Arctic When some Ketchikan business operators put their heads together over the last two years, they discovered that Ketchikan is home to more than two hundred maritime-related businesses and some 1,700 marine-industry workers dispersed across nine key subsectors: marine transport and logistics; shipbuilding and repair; marine civil construction; marine vendor base (for example, local fuel docks); ports, harbors and supporting infrastructure; related professional services; allied industries (supporters, such as Best Western Landing hotel and restaurant, the lo-

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Alaska Business Monthly | September 2013

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cal chamber of commerce, and Alaska Construction Academy); the marinerelated component of the visitor industry; and government. In short, Ketchikan’s maritime sector constitutes a competitive industry “cluster” from an economics perspective—a well-rounded, mature collection of service providers sufficient to competitively support a particular primary sector, in this case the marine industry. Given that, according to the North American Industry Classification System, the marine sector is spread across

more than seventeen parent categories (such as manufacturing) and with a significant focus on science, technology, engineering and math component, the target market for marine services is wide and large enough to support and sustain high-quality, well-paid Alaska jobs, the Marine Council suggests in its Draft Report: Composition of Ketchikan’s Marine Industry Sector. In the report, the Marine Council concludes that Ketchikan’s proximity to Puget Sound; its existing cluster of marine industry businesses; ice-free, deep-

water ports and harbors; and its advantage of being the location of the state’s largest shipyard make it an ideal hub to serve Alaska and Arctic operators. As a client base, the group sees potential from offshore oil and gas exploration and development companies, area mines and ore processors, Arctic operators, and through the general, increased use of the North Pacific Great Circle (the shortest shipping route from western North American and East Asia), Arctic Circle, and Northwest Passage trade routes. “No other Alaskan community provides a closer, more dependable link to Puget Sound’s supply chain,” the Council suggests in its 2012 report. The concept and its logic and potential—of Ketchikan’s cluster of related businesses working together to purposefully serve the marine industry— was the subject of a recent Ketchikan Area Chamber of Commerce presentation earlier this year. The presentation, by the Marine Council’s Senior Project Manager Doug Ward of Alaska Ship & Drydock and Project Coordinator Jason Custer of Alaska Power and Telephone, included the increased Arctic traffic as an area of particular focus and research. They posed the possibility of a future when Alaska’s Arctic drill fleets would use Ketchikan for moorage, repair, and maintenance, posing a significant transportation savings from transiting further south for the same service or when the Arctic visitor industry would include departures from Southeast Alaska ports. Ward warned that now is the time for Southeast Alaska to position itself as a provider to Arctic development. “This is urgent stuff,” Ward said. “And it’s got to be understood, and we’ve got to execute and do it quickly; or one of the last, great economic opportunities that this state has in front of us is going to pass us right by.” This month during Southeast Conference in Sitka, Ward will elaborate on the Marine Council’s latest activity and its research regarding Arctic potential.  Nicole A. Bonham Colby writes from Ketchikan.

Alaska Business Monthly | September 2013

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TRANSPORTATION OP-ED

Alaska Native Brotherhood Joins Renewable Fuel Standard Reform Group By Bob Loescher The views expressed herein are the author’s own.

t may be difficult to imagine an entire town couldn’t get fuel because the icebreaker ship delivering it was lodged in the sea ice, but that’s the kind of situation we run into here in Alaska. That’s why the Alaska Native Brotherhood Grand Camp (ANB) recently joined the Domestic Fuel Solutions Group (DFSG), a coalition of fuel industry stakeholders from the energy, transportation, food service, and agriculture industries. Founded in 1912 in Sitka, Alaska, ANB is the oldest American Indian civil rights organization in the country. With chapters all over the state, the organization advocates to federal, state, and local government about education, citizenship, economic development, and other issues important to Alaska Natives. The DFSG’s fight to reform the Renewable Fuel Standard resonated with the ANB for one primary reason: high prices. Energy rates are higher in Alaska, particularly for communities in remote areas. A significant part of every dollar that Alaska Natives living in rural communities make goes toward paying for the premium priced fuel and electricity that powers their vehicles, generators, and space heaters. This is money that could be used for food, medicine, clothes, and other critical supplies—all of which are also hard to get and expensive, even for Alaska. The high cost of fuel is only driven higher by the fact that ethanol, which is blended into Alaskan transportation fuel, must be shipped into the state from thousands of miles away. This ethanol import is necessary for one reason www.akbizmag.com

Renewable Fuel Standard he Renewable Fuel Standard, created under the Energy Policy Act of 2005, originally required that 7.5 billion gallons of renewable fuel be blended into gasoline (creating E15—gasoline that contains greater than 10 percent and up to 15 percent ethanol) by 2012. The RFS was modiﬁed in 2007 by the Energy Independence and Security Act, which expanded the program to include diesel as well as gasoline and increased the volume of renewable fuel required to be blended into transportation fuel from 9 billion gallons in 2008 to 36 billion gallons by 2022, as well as other changes. (epa.gov)

only: ethanol is made from corn, and not much corn grows in Alaska. And it’s not just the cost of fuel that increases hardship. Food prices—already high in Alaska—were driven even higher because of the 2012 drought and the Renewable Fuel Standard’s mandate that ethanol be blended into diesel and gasoline. Food prices are normally 20 to 25 percent higher in Alaska because it is shipped in from around the Lower 48 and across the globe. What can be additionally frustrating is that plenty of alternative fuel solutions exist right here in-state. The use of natural gas, which is abundant in Alaska, to make alternative fuel could solve the high fuel and food price conundrum for the Alaska Native community. Plus, growing Alaska’s natural gas market would also bring much needed jobs to Alaska Native communities and

DFSG Mission Statement he DFSG is bringing together a cross-section of likeminded stakeholders and thought leaders to challenge the conventional thinking on US fuels policy. Together we’re seeking consensus on comprehensive energy solutions and innovative ways to ensure the short and long-term growth of the alternative fuels market. A top priority is to encourage a thorough review of the Renewable Fuel Standard (RFS) in light of new developments in the domestic alternative fuels landscape. The RFS needs to account for a full diversity of fuel technologies and to foster, rather than inhibit, a fair and competitive alternative fuels marketplace. But change does not come easily to federal regulations. It will take a robust collaborative effort to press Congress to modify this outdated standard. The DFSG is committed to this effort. (dfsgusa.org)

would stimulate commerce statewide. The ANB is also supporting the development of other fuel-producing technologies, like lake-tap hydro, geothermal, and the production of ethanol from timber waste. The group is hopeful that RFS reform legislation pending in the US House will bring relief to Alaska Native communities; ANB is happy to join the DFSG in this fight.  Bob Loescher is the Legislative Director for the Alaska Native Brotherhood (Grand Camp).

September 2013 | Alaska Business Monthly

HEALTH & MEDICINE

Telemedicine Saves Dollars and Makes Sense for Alaskans By Susan Sommer

Photo courtesy of ANTHC

A cardiology VTC (video teleconference) through the Alaska Native Tribal Health Consortium.

hat could one do with an extra $10 million dollars? That’s the amount experts say Alaskans will save this year alone in travel expenses by taking advantage of telemedicine services around the state. Imagine a single parent living in a small rural Alaska community whose child is having chronic ear aches. The

only medical care available is a clinic that offers basic services and certainly no ear, nose, and throat specialist. The child’s pain worsens with each successive occurrence despite attempts to relieve the pain with pain medication. If that community’s health facility does not have access to telemedicine services and equipment, the parent

Alaska Business Monthly | September 2013

would travel by boat, snow machine, or small plane to a larger transportation hub, ﬂy on a commercial airline to Anchorage or Fairbanks, pay for housing and food while in the city, go to multiple appointments with various doctors, and possibly have to return home for a time before the child is able to be scheduled for surgery. The parent would then www.akbizmag.com

incur the costs of a second trip to town on top of the first. The biggest danger in a situation like this is that the illness goes untreated and the child loses his or her hearing. Or the cause could be a simple ear infection that responds to antibiotics. Breaking the bank only to find out the cure costs less than $100 isn’t the best method of health care. The picture will be very different, however, if the small rural community does have access to telemedicine services and equipment. The parent and child visit the local health provider who gathers as much data as possible about the child’s case. The process includes using peripherals attached to a portable telemedicine cart to take a high resolution photo of the ear canal and tympanic membrane. A history of the child’s symptoms is included as text, and the combined information is digitally stored as a case and then forwarded to an ear, nose, and throat doctor in an urban region via Internet connection. The doctor receives an email that a new case needs attention. He or she reviews it and sends back a recommendation that may or may not include a trip to town for an in-person visit or for surgery. The parent knows within a day, and many times within hours, what the verdict is. If the doctor determines that the case is easily remedied right there in the village through, perhaps, a course of antibiotics, the child’s pain is relieved sooner, and the parent saves an enormous amount of money, worry, and time away from work.

over a decade across Alaska as well as nationally and internationally. Created using AFHCAN’s tConsult Cart store-and-forward interface, cases may contain textual information and data from biomedical peripherals, including a wand-like dental camera, video camera, otoscope (for ear, nose, and throat issues), tympanometer (ear issues), vital signs monitor, spirometer (measures lung function), electrocardiogram, stethoscope, and scanner. Using the tConsult Web interface, health care professionals are able to view

the data and respond to the case using a standard PC or MAC workstation. Both tConsult user interfaces are user-friendly, require little bandwidth, and are used to network with larger health care centers for consulting, video teleconferencing, and referral management. ANTHC’s chief information officer, Stewart Ferguson, PhD, was key in developing AFHCAN. “If you can use [Microsoft] Outlook,” says Jordan Berg, telehealth coordinator for the Alaska Native Medical Center, “you can learn this software.”

Leaders in Telemedicine The Alaska Native Tribal Health Consortium (ANTHC) is at the forefront of telemedicine in the 49th state and beyond. ANTHC is a nonprofit health organization that provides statewide services in medical care; operates the Alaska Native Medical Center hospital in Anchorage; focuses on construction of water, sanitation, and health facilities in rural Alaska; and works closely with local, state, and federal partners to its meet its vision that Alaska Native people are the healthiest people in the world. ANTHC developed the Alaska Federal Health Care Access Network, or AFHCAN, whose mobile telemedicine carts are a combination of off-the-shelf hardware and specifically designed software that have been in use now for www.akbizmag.com

September 2013 | Alaska Business Monthly

Alaska Native Tribal Health Consortium Telehealth Coordinator Susan Davidson, LPN, points at the screen of an AFHCAN telemedicine cart. Photo by Susan Sommer

AFHCAN provides training on its hardware and software systems with the ability to tailor forms and other specifics to each individual organization that uses it. The training program has been accredited by the American Telemedicine Association. There are currently more than three hundred AFHCAN telemedicine carts in Alaska, about one hundred in the Lower 48, sixty-five in Greenland, fortyfive in the Maldives, and several more in Ireland, Greece, Spain, Panama, and Canada.

What Telemedicine Can Do Defined by the American Telemedicine Association, telemedicine is “the use of medical information exchanged from one site to another via electronic communications to improve a patient’s clinical health status. Telemedicine includes a growing variety of applications and services using two-way video, email, smartphones, wireless tools, and other forms of telecommunications technology.” And although telemedicine is similar to health information technology, health information technology usually refers to electronic 88

medical records and related information systems; telemedicine refers to the actual delivery of remote clinical services using technology. Besides saving millions of dollars each year in travel expenses for Alaskans, telemedicine helps patients get better care faster. “It’s an opportunity to serve our customer owners for higher quality care,” says Susan Davidson, LPN, telehealth coordinator for ANTHC. “What we do is all about quality patient care. The benefits are cost savings and safety.” Telemedicine works very well with visually based health issues such as counseling, speech-language pathology, dermatology, wound care, and ear, nose, and throat issues. Telemedicine cart peripherals that provide doctors and specialists with clear images of a patient’s teeth, inner ear, skin conditions, and other areas make it easier to identify things like tooth decay, ear infections, and rashes respectively, and making a diagnosis possible without a costly and time-consuming inperson visit. Video teleconferencing is gaining a foothold in Alaska as a health care tool, too.

Alaska Business Monthly | September 2013

Brian Wregglesworth, director of product development for AFHCAN, says that when his team was comparing companies that offer teleconferencing services, “Vidyo quickly bubbled to the surface” for quality. Testing offered clear video with health providers in several locations connected simultaneously for hours and no dropped connections. Vidyo is a New Jersey-based company with national and international offices. With 75 percent of Alaska’s communities not connected by a road to a hospital, video teleconferencing, or VTC as practitioners call it, is an invaluable alternative to an old fashioned in-person visit. Doctors and patients can communicate in real time as if in the same room, and the high-quality video helps doctors assess patients through visual and auditory details as well as with the written descriptions, photos, and other digital data collected in the case. Using VTC, a doctor can, for example, hear and assess a patient’s cough, observe visually how wound care has progressed, or counsel a person suffering from depression. These virtual doctor visits are HIPAA-compliant, convenient, and interactive. www.akbizmag.com

Though VTC requires higher bandwidth than the store-and-forward system, Alaska’s telecommunication companies are very supportive of telemedicine efforts across Alaska. Communications technology in rural communities has greatly improved in recent years, and store-and-forward integrates easily with VTC across a spectrum of platforms. Internet service providers “work hard to get ANTHC more bandwidth,” says Berg. For example, GCI completed the first terrestrial broadband network connecting sixty-five communities in Southwest Alaska in 2011. In 2012, microwave towers and remote repeaters were added, as well as broadband internet service to homes in the region. GCI is working on more of the same in Northwest Alaska. Gene Peltola, president and CEO of Yukon-Kuskokwim Health Corporation, says the addition of GCI’s network “made our day out here.” Every regional and sub-regional clinic in the Yukon-Kuskokwim Health Corporation area has a telemedicine cart and VTC capability. Peltola sees the

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Alaska Native Medical Center Telehealth Coordinator Jordan Berg showing an AFHCAN telemedicine cart. Photo by Susan Sommer

future of telemedicine in Alaska as improving in capacity and technology as it evolves. What used to take days now takes just minutes via the AFHCAN system. For example, he says, it used to take ten to twelve days for a mammogram to be read. Now the results can

come back to the patient and her health care provider in ten minutes. Insurance companies have been slow to cover these virtual doctor visits via telemedicine systems. Live video teleconferences used in medical care in the Lower 48 are reimbursed but not

September 2013 | Alaska Business Monthly

Photo courtesy ANTHC

Two young ladies are shown something on an AFHCAN telemedicine cart.

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Alaska Business Monthly | September 2013

yet in Alaska. Medicare and Medicaid, however, do reimburse for store-andforward “visits.” Private insurers are slowly responding to this new system of health care. In April of this year, State Senator Fred Dyson introduced SB80 that would allow licenses for out-of-state physicians to practice telemedicine in Alaska under certain circumstances; this bill also addresses insurance coverage for telemedicine. The bill is currently in the Senate Labor and Commerce Committee.

Who Does Telemedicine Help? It’s not just Alaska Native populations reaping the benefits of telemedicine systems in Alaska. The Veterans Administration has partnered with non-tribal community health centers and community mental health centers to provide services for veterans. Alaska Psychiatric Institute is using telemedicine for follow-up care. And the State of Alaska’s Senior and Disabilities Services uses telemedicine for assessments of personal care assistant waiver recipients. www.akbizmag.com

Susan Morgan, public information manager for the state’s Department of Health and Social Services, says there are a multitude of uses for telemedicine across Alaska. They include, but aren’t limited to, cross-division/discipline consultation related to child protective services; independent living transition planning into adult services with youth in rural locations; diabetes health management and patient self-management; psychiatric nurse consultation with psychiatrists and other medical professionals regarding medication monitoring and follow-up; mental health crisis stabilization within juvenile justice; and informatics, disease reporting, monitoring and surveillance, data collection, analysis, and emergency response. Challenges of implementing telemedicine in rural Alaska include hidden costs such as switching a paper system to an electronic system, training, resistance to learning a new system, and creating new workﬂows and business processes. AFHCAN’s training programs reduce resistance to new technology and procedures. Courses offered include train the trainer, clinical administrator course, super user course, and technical training for IT personnel. As soon as health care providers adopt the new systems, says Berg, they are typically thrilled with them and appreciate the time it saves them as well as the higher level of care their patients get.

Telemedicine in Action A case study published by Vidyo in 2012 illustrates how much Vidyo has helped rural health providers. Dr. Ella Derbyshire, medical director of the Maniilaq Health Center in Kotzebue, is quoted as saying, “I’m in Kotzebue and my patients are in Selawik, which is about ninety miles away. With telemedicine I can look inside of a child’s ear to see if they have an infection, I can oversee a resuscitation procedure or the birth of a baby via Vidyo. It’s a very important element to providing quality medical care here. Before telemedicine, if we had an emergency in the village—let’s say a snow machine crash—we would not be able to adequately assess the patient’s condition. We would have to rely on a community health aid practitioner to describe the patient’s condition to dewww.akbizmag.com

termine if this is someone who needs to come into Kotzebue ... or can stay where they are ... or needs to be transported by plane directly to the medical center in Anchorage if they’re so acute that they need to see a surgeon immediately.” Derbyshire says that “over Vidyo you are able to make eye contact with the patient so they can see that you’re giving them 100 percent of your attention and they are actually relating to you via that eye contact. You ask them a question and they respond immediately. You can ask them to ‘show me

where it hurts’ and you can see where they’re pointing to, you can discern if they are in pain or if they don’t seem all that uncomfortable. You really make a connection and have a better feel for what’s going on and the patient seems to understand that. It’s so much better than communicating over telephone or email ... it’s real, it’s personal, and it’s immediate.”  Susan Sommer writes from Eagle River.

community-owned fmhdc.com September 2013 | Alaska Business Monthly

special section

Alaska Native Corporations

Alaska Native Regional Corporations An economic powerhouse for Alaska orty years ago, the Alaska Native regional corporations were just getting their feet wet in the business world. When the historic Alaska Native Claims Settlement Act was signed in December 1971, Alaska’s Native peoples had $963 million, the rights to 44 million acres of land, and no roadmap. Over the following four decades, despite a few major bumps in the road, the corporations have found their footing and profitability. As part of the journey, they are also helping shareholders keep a toehold on their Native traditions and cultures while finding success in today’s world. A common denominator in the success of many of the regional corporations is government contracting, which in some cases accounted for more than three-quarters of corporate income. Recently, however, the oversight of contracting programs has been tightened, fewer contracts are available, and the costs of performing them have risen. The future of contracting as a strategic enterprise is murky and the corporations are focusing on opportunities elsewhere. Increasingly, they are looking back to their lands, their people, and their traditions for inspiration. Despite the challenges, the regional corporations are an economic powerhouse for the state of Alaska. In fiscal year 2012, they tallied more than $9 billion in revenue, with hundreds of subsidiaries and thousands of employees. Here is a look at the highlights:

Ahtna Inc. 2012 was a year of movement and restructuring for Ahtna, Inc. Its subsidiary, 92

Photo courtesy The Aleut Corporation

By Julie Stricker

Bentwood visor construction is taught at Urban Unangax Culture Camp, held every summer at the Aleutian Pribilof Islands Association facility in Anchorage.

Ahtna Development Corporation, manages real estate and business development and helped transition its operating subsidiaries under Ahtna Netiye’, Inc. Ahtna Netiye’ is the holding company for the corporation’s fifteen operating subsidiaries in fields such as construction, pipeline support, logistics, environmental remediation, and government contracting. William Anderson Jr. was named CEO for Ahtna Netiye’ in July. Anderson is the former president and CEO for Koniag, Inc., the Alaska Native regional corporation for the Kodiak region. The corporation is owned by 1,700 shareholders of Ahtna Athabascan descent from the Copper River and Cantwell

Alaska Business Monthly | September 2013

areas and employs more than 2,200 workers throughout its subsidiaries. In 2012, Ahtna began to focus on protection and development opportunities on its own land, according to a statement from Ahtna President Michelle Anderson. Among its goals are natural gas exploration and development near Glennallen. Financially, 2012 was a banner year for Ahtna, which had gross revenues of $189 million and a net income of $4.7 million, despite a steep decline in government sole-source contracts. A $3.53 per share dividend was announced. That contrasts with 2011, in which Ahtna had $205 million in revenues, but a net loss of $2.6 million. www.akbizmag.com

Part of its 2012 focus on profitability included cost-cutting efforts, which included eliminating more than $100,000 in office lease costs in Anchorage alone. After years of having offices scattered around town and paying rents to other entities, Ahtna has a new home base in Anchorage. The corporation has new offices on 38th Avenue in a building that not only houses its corporate offices, but those of its subsidiaries as well. Subsidiary Ahtna Construction opened a new facility in Fairbanks to aid in its work with Alyeska Pipeline Service Co. The corporation also was able to buy a building in Sacramento, California, which allowed it to consolidate its interests in the area under one roof.

The Aleut Corporation The Aleut Corporation (TAC) is following a strategy of “cautious growth,” which netted revenues of $116.3 million in 2012, a 19 percent increase over 2011. It is looking to broaden its base of operations by seeking businesses that will work well with its current divisions, according to CEO David Gillespie. TAC subsidiaries work in fields such as government contracting, telecommunications, environmental remediation, fuel sales, and real estate management. TAC acquired Colorado-based Analytica Group, which does water testing in Alaska and Colorado. It also acquired a partial interest in industrial property in Chandler, Arizona, and sold commercial property in Anchorage and Colorado Springs. The corporation, with a land base along the Aleutian Chain, has 3,700 shareholders. In its fiscal year 2013, TAC declared dividends of $6 per share and elder benefits of $500 per elder (shareholder over sixty years old) for a combined total of more than $2.4 million. It also contributed another $1 million to shareholder and cultural programs, mainly through the Aleut Foundation. In turn, the Aleut Foundation paid out more than a half-million dollars for education and career development to shareholders and their descendants. “The the end of the day, we are in business to provide dividends and educational opportunities for our shareholders,” says Thomas Mack, TAC president. “This is the reason we are here.” www.akbizmag.com

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September 2013 | Alaska Business Monthly

Right: Six ASRC shareholders at the James Madewell Space Camp in Huntsville, Alabama. Below right: A group of residents gather for Inupiaq Days in Atqasuk. Photos courtesy of Arctic Slope Regional Corporation

Arctic Slope Regional Corporation Arctic Slope Regional Corporation (ASRC) is the largest locally owned and operated business in Alaska, and it’s still growing. 2012 was a busy year for ASRC, as it moved forward on some major projects. ASRC Energy Services Inc. broke ground on two major projects: the Rig Tenders dock in Kenai and a forty-five thousand-square-foot under roof fabrication facility at Omega Natchiq, Inc. ASRC Energy Services also was selected to take a lead role in the construction of the MHA Thunder Butte Petroleum Services oil refinery project on the Fort Berthold Indian Reservation in North Dakota. The refinery will be the first built in the Lower 48 in the past thirty years, according to Ty Hardt, ASRC director of communications. ASRC also developed a five-year plan, which sets aggressive goals through 2017. It’s off to a promising start: ASRC saw $2.6 billion in revenue in 2012, its highest ever. The corporation, which is based in Barrow, represents more than 11,000 shareholders of Iñupiat Eskimo descent. The corporation in 2012 had its highest level of shareholder hire and is continuing programs to assist shareholders. For one such program, called the Paannaq Initiative, the corporation partners with a subsidiary and a North Slope community. For example, the renovation of a dilapidated playground 94

next to Tikigaq School in Point Hope is a collaboration between Point Hope and subsidiary ASRC Federal. Sponsored by ASRC Federal Holding Company, more than a dozen shareholders attended a weeklong space camp in Huntsville, Alabamba. Named in memory of space pioneer and former ASRC Aerospace president James Madewell, the program is designed to bolster shareholder interest in engineering, aeronautics, robotics, and other technical careers. ASRC is also a co-sponsor of Iñupiaq Days, which encourages education, health, and exercise and anti-tobacco, alcohol, and drug campaigns. Iñupiaq Days helps strengthen shareholders’ and employees’ knowledge and connection with Iñupiaq culture and shares career opportunities within ASRC and subsidiaries.

Alaska Business Monthly | September 2013

“Educating our people of the possibilities inside and outside the ASRC family positions our growing shareholder base for success in the labor force,” Hardt says.

Bering Straits Native Corporation Bering Straits Native Corporation (BSNC) reached a milestone in 2012 with the conveyance of its lands in the Salmon Lake and Imuruk Basin area, the culmination of many years of work to settle competing land claims. The corporation, based in Nome with 6,300 shareholders of Iñupiaq and Yup’ik descent, is strategically located along the Bering Straits and is working to develop strategic businesses in anticipation of an increase in marine traffic as Arctic ice diminishes. On land, BSNC purchased Alaska Gold Co. from www.akbizmag.com

“I have lived most of my life in Igiugig, but now it’s time for college. I’ll be back someday. I have a lot of people counting on me to do my best, and I will.” — April Hostetter, College student and BBNC shareholder intern

Building Alaska’s Future

US Senator Mark Begich (left) and Bering Strait Native Corporation CEO Gail R. Schubert acknowledge the conveyance of lands.

revenue in its history, $404 million, with a net income of $21.7 million. It also increased dividends to its 12,600 shareholders of mostly Yup’ik, Cup’ik, and Athabascan descent by 8 percent, or $4.3 million. Calista subsidiaries work in such diverse fields as telecommunications technology, aviation, government contracting, and construction. In addition, Calista paid out $460,000 in scholarships and another $140,000 for internships, as well as increasing elder payments by 5 percent for a total of $550,000.

Photo courtesy of Bering Straits Native Corporation

NovaGold Resources, which had been focusing on reclamation at the Rock Creek gold mine site. BSNC CEO Gail Schubert says the corporation is evaluating whether mining operations can be resumed at the site. Its main business holdings are in government contracting, construction, property management, and tourism. In 2012, overall revenues were up almost 8 percent over 2011 for a total of $213 million. Locally, BSNC subsidiary Inuit Services Inc. and Neeser Construction built a new regional hospital in Nome, helping improve health care for shareholders as well as providing employment for shareholders and their families. The corporation also supports the Bering Straits Foundation, offering scholarships, fellowships, and mentorship opportunities to shareholders and descendants. In 2012, the foundation provided more than $238,000 in educational funding.

Bristol Bay Native Corporation In 2012, Bristol Bay Native Corporation (BBNC) unveiled a new logo that it says makes clear the corporation’s identity as “a unique investment corporation with the sole responsibility of enriching our Native way of life.” The logo, a tri-colored arc of salmon encircling the words Bristol Bay Native Corporation, makes clear that salmon-rich Bristol Bay is its priority in southwest Alaska. While BBNC is a successful global enterprise with more than forty subsidiaries around the world, its focus is increasingly on fostering economic development at home. 96

Recently, BBNC purchased Mission Lodge in Aleknagik, bringing it back into the tourism industry. Other subsidiaries operate in construction services, government services, oilfield and industrial services, and petroleum distribution. In 2012, BBNC generated $1.965 billion in revenue, with growth in all segments of its operations. Over the past years, BBNC has significantly increased shareholder dividends. In September 2011, the board paid out $100 million in dividends to its 9,000 shareholders. It recently began paying out $125 quarterly dividends to elders.

Calista Corporation In 2009 Bethel-based Calista took a hard look at the future of the corporation and set five goals: 1) Increase revenue to $350 million by 2014, 2) Increase total pretax profitability, 3) Realize the Donlin Creek property mining investment, 4) Boost regional infrastructure and economic development, and 5) Increase shareholder services and businesses. By fiscal year 2012, Calista had already met four out of five and exceeded its longer term revenue goal by $50 million. It is still working toward the Donlin Creek measure but says great strides have been made toward its goal of getting the world-class gold mine online. Calista owns the subsurface land and The Kuskokwim Corporation owns the surface rights. The project has at times boasted an 85 percent or higher Alaska Native hire rate and is in the permitting phase. Probable reserves are estimated to be 33.8 million ounces of gold. In 2012, Calista had its highest total

Alaska Business Monthly | September 2013

Chugach Alaska The sale of its former headquarters building in Anchorage in 2013 was the closing of a chapter in the history of Chugach Alaska Corporation. The corporation, which declared bankruptcy in 1991, moved its offices to the 34th Avenue building in 1993. Within a few years, Chugach Alaska successfully entered the field of government contracting, climbed out of bankruptcy, and bought the building in 2001. Years of growth followed, and Chugach Alaska outgrew those offices as well as the building next door. Today more than 200 employees occupy several ﬂoors of the JL Tower. With the sale of the former building, the corporation, which has more than 2,500 shareholders and a land base around Prince William Sound, is moving forward. It has 5,400 employees around the world who provide wideranging facility services for federal and commercial clients, including base operations support, construction, facility management, and information technology management. Chugach Alaska also has a diverse investment portfolio. In 2012, revenue totaled $709 million. The corporation’s Hawaii HVAC subsidiary bought the assets of mechanical contractors Heide & Cook, which had been operating under Chapter 11 bankruptcy. In 2013, the federal Bureau of Land Management conveyed twelve historical sites in Prince William Sound to Chugach Alaska. The corporations states, “Traditional lands are the basic building blocks that form and unite our culture. These sacred lands where our forefathers have lived and died are considered the heart and soul of a people.” www.akbizmag.com

Regular and elder dividends totaled more than $61.50 per share. Including dividends, Chugach Alaska paid out more than $12 million for educational, health, social, and cultural programs and employment assistance. Chugach Alaska also provides support for Nuuciq Spirit Camp.

Cook Inlet Region Inc. After years of planning, permitting, partnering, and construction, Cook Inlet Region, Inc., (CIRI) launched its Fire Island Wind Project in 2012, capping a year of continued growth and diversification for the Anchorage-based corporation. CIRI also had strong performances from its natural resources and energy, government contracting, and investment portfolio, which helped garner total revenues of almost $238 million. Net income was $16.4 million. The corporation, which has about 7,500 shareholders from all parts of the state, made several strategic investments in 2012, including the acquisition of 75 percent ownership interest in Cruzco Services Holdings. That investment gives CIRI a firm foothold in the growing oil field services industry in North Dakota. CIRI also acquired a 75 percent stake in Weldin Construction, which works in the fields of civil, mechanical, and electrical construction. In addition to the Fire Island project in Anchorage, CIRI is also a major investor in wind energy projects in Wyoming, Texas, Nebraska, and eastern Washington state. Dividends to shareholders topped $22 million in 2012, and CIRI anticipates that sometime in 2013, it will reach the $1 billion benchmark for dividends paid throughout its forty-year history. In January 2013, Sophie Minich was named CIRI’s CEO. Minich started working at CIRI in 1993 and has held a variety of positions in the corporation. As CEO, she is responsible for CIRI’s corporate strategies, oversees the company’s business operations, and is the primary contact with stakeholders. CIRI also conveyed 230,000 acres of land to village corporations in its region, capping a long and often contentious process. Doyon, Limited In 2012, Fairbanks-based Doyon, Limited and other Interior Alaska Native organizations released an economic www.akbizmag.com

September 2013 | Alaska Business Monthly

impact report based on 2010 data. The bottom line: Interior Native organizations had a $500 million economic footprint statewide, with $300 million of that directed to Interior Alaska. That does not include the impacts of the other eleven Alaska regional corporations, numerous village corporations, or other Native organizations. 2012 was Doyon’s 28th consecutive year of profitability. Its subsidiaries in such areas as oil field services, government contracting, natural resource development, and tourism brought in total revenue of more than $338 million, with a net income of $17.3 million. Doyon also enrolled its 10,000th Class C shareholder—a shareholder born after December 18, 1971—giving it a total of 18,700 shareholders. As a way to help strengthen shareholder ties to their culture, Doyon announced its support of a new Athabascan language revitalization program at the Doyon Foundation. Doyon is actively exploring a 400,000 acre bloc of lands west of Nenana for oil. A well drilled in 2009 about three miles west of Nenana did not find commercial levels of oil and gas, but the results were

promising enough for Doyon to drill a second oil exploration well a few miles west this year. It may seek permits for two additional wells. Doyon is also studying areas near Birch Creek and Stevens Village for oil and gas potential. Doyon also has agreements with several mining companies that allow them to explore on Doyon lands for gold, silver, lead, zinc, and copper. More exploration could occur in the future.

Koniag Inc. Koniag is looking to its land base to help diversify its operations from a reliance on federal contracting. The corporation, with about 3,800 shareholders of mostly Alutiiq descent, is headquartered in Kodiak. In a nod to one of the most notable aspects of Kodiak life, Koniag opened the Kodiak Brown Bear Center at Karluk Lake. The corporation has 56,000 acres along Karluk Lake and Karluk River, boasting some of the highest concentrations of brown bears on the island. The development of the Shakmanof granite quarry on the northern coast of Kodiak Island would be the linchpin in

a marine construction company, plus the sale and transportation of the granite itself. Commercial operation is expected this year. Another area of focus is its aerospace manufacturing sector with its subsidiary Angeles Composite Technologies, which the corporation believes is geared for strong growth. In 2012, Koniag garnered revenues of $126.9 million with net earnings of $6.1 million, both below results for 2011 and 2010. The company showed a $10 million loss of earnings from operations before taxes. President and CEO Will Anderson stepped down in March 2013 and was succeeded by interim president Tom Panamaroff and interim CEO Ron Unger.

NANA Regional Corporation With an Indiana-size chunk of land above the Arctic Circle in Northwest Alaska as its base and some of the highest energy costs in the state, NANA has long been interested in affordable energy. For years, it has worked with its more than 12,500 Iñupiat shareholders to boost energy efficiency in their homes. Now, it is

$1 BILLION annual spending

Good-paying year-round jobs

Investing in Alaska

50%

of royalties to the Permanent Fund

DOUBLE

operational jobs annually

Alaska’s mining tax revenue (based on 2012)

1,000+

pebblepartnership.com Preliminary economic data from IHS Global Insight report commissioned by the Pebble Limited Partnership, 2013.

Alaska Business Monthly | September 2013

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turning its attention to the land below. The region is one of the largest unexplored on-shore basins of potential oil and gas deposits. NANA is reviewing historic oil and gas exploration data from work done by Chevron in the 1970s to evaluate the potential for more exploration. It’s one of myriad projects NANA is undertaking. The corporation’s NANA Development arm has dozens of subsidiaries in engineering and construction; resource development; facilities management; real estate and hotel development; and information technology and communications. In 2012, revenues totaled $1.8 billion. NANA has a long, fruitful partnership with Teck Alaska, which operates Red Dog Mine, one of the largest zinc mines in the world. It is also working with NovaCopper to investigate copper, zinc, and precious metal deposits through the Upper Kobuk Mineral Project, as well as gold, base metals, and rare earth elements on the Seward Peninsula. NANA leverages its partnerships to help provide jobs and educational opportunities for shareholders. In 2012, NANA contributed more than $3.5 mil-

lion to the Aqqaluk Trust, which in turn awarded $780,000 in scholarships to 340 NANA shareholders, dependents, and descendants. NANA also revived its Iñupiaq Word of the Week, which complements work done by the Aqqaluk Trust and the Rosetta Stone Iñupiaq software.

Sealaska Sealaska is looking toward its traditions as a model for its role in Southeast Alaska. The Juneau-based corporation, with 21,000 shareholders of Tlingit, Haida, and Tsimshian heritage, likens itself to a clan house, the symbolic center of its culture. As part of that role, Sealaska is realigning its business operations to take advantage of its core Native values and status as an Alaska Native corporation. One step was selling its interest in Nypro Kanaak, a plastics injection and molding manufacturing business. The corporation is planning to focus its businesses on a smaller number of operations, having closer geographic ties to shareholders whenever possible. The Haa Aani Community Develop-

ment Fund is partnering with The Nature Conservancy to create a partnership fostering sustainable economic activity in Southeast Alaska. Sealaska has subsidiaries in the natural resources, manufacturing, services, and gaming industries. Its operations showed strongly higher revenues of $311.6 million in 2012, with net income of $11.3 million. In 2011, Sealaska brought in $263.8 million with net income of $6.8 million. The corporation is also supporting the restoration of historic clan houses such as the Chief Shakes Tribal House in Wrangell and the Chief Son-i-Hat Whale House in Kasaan.

13th Regional Corporation The 13th Regional Corporation has been inactive for several years and has no formal status. Shareholders have created a Facebook page as a virtual gathering place as they seek to revive the corporation and reclaim any assets.  Julie Stricker is a journalist living near Fairbanks.

Strengthening Alaska Through Our Values

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September 2013 | Alaska Business Monthly

special section

Alaska Native Corporations

Village Corporation Overview Finding creative ways to use assets and beneﬁt shareholders Compiled by Mari Gallion

hen considering the multitudes of Alaska Native Village Corporations and the diversity of their lands and assets, many village corporations are finding complementarily divergent ways to make money and opportunities for shareholders. Following is a composite of what many village corporations are working on in 2013.

Tanadgusix Corporation (TDX) The Village Corporation of Saint Paul TDX Corporation has started construction on an ultra-modern, aviation-themed office complex and parking facility to be built at the corner of Spenard and International Airport roads in Anchorage. The 5.6-acre property currently houses the former Alaska National Guard Armory, a well-known fixture in Anchorage since the 1960s. The unique 19,500-square-foot structure will not only feature an aviation theme, but will also have the appearance of a large, whimsical aircraft. When complete, the building will house TDX corporate offices, the new Alaska MasterPark Valet offices, mixed office and meeting rooms, a sit-down dining café, and will provide convenient valet parking for one thousand vehicles. Construction begins this summer with the completion of the valet parking facility scheduled to open No100

vember 1. The aviation theme of the new development will be cultivated through the ongoing teamwork between TDX and the Alaska Aviation Museum. Design of the aviation themed facility is being provided by Ivy & Co. Architects of Anchorage. The project is financed through Northrim Bank, and McCracken & Associates will manage construction as the owner’s representative. The contractor selected for construction is F & W Construction of Anchorage.

Huna Totem Corporation The Village Corporation of Hoonah Formerly the Cultural Interpretive Services department of Huna Totem Corporation, Alaska Native Voices will offer a cultural tourism resource and consulting service to other Native peoples, cultural groups, and communities around the world. For the past thirteen years, Huna Totem Corporation has shared its people’s culture and history with travelers who have visited the Huna Tlingit ancestral homeland, Glacier Bay National Park and Preserve, and their modern day home in Hoonah. The new service will help other groups or destinations share their culture with visitors. A solid business plan and training model will be developed for each client that balances cul-

Alaska Business Monthly | September 2013

tural integrity and visitor expectations. Huna Totem Corporation began its Cultural Heritage Guide program in 2000. Cultural presentations are planned onboard 199 cruise ships in Alaska waters during the 2013 season. Huna Totem Corporation also opened Icy Strait Point, a cruise destination offering cultural and adventure experiences in Hoonah in 2004. More than a million travelers have visited Icy Strait Point, with another 135,000 cruise passengers scheduled to visit in 2013. Conde Nast Traveler named Icy Strait Point as a finalist in the magazine’s sixth annual World Savers Awards, which honor travel companies that demonstrate exceptional achievement in environmental and social responsibility. Of 174 applicants, 53 finalists were selected across eight categories. The winners will be announced in the September issue of Conde Nast Traveler magazine.

Eklutna, Inc. The Village Corporation of Eagle River, Chugiak, Peters Creek, Eklutna, and parts of the Mat-Su Borough Eklutna, Inc. has teamed with Davis Constructors to supply the local market with competitively priced aggregate products. Davis Constructors recently www.akbizmag.com

Artist’s concept of the ultra-modern, aviation themed ofﬁ ce complex and parking facility TDX Corporation is building at the corner of Spenard and International Airport roads in Anchorage. Image courtesy of Ivy & Co. Architects

formed a subsidiary called Mass Excavation, Inc., which will operate the Eklutna Gravel Site. Eklutna, Inc. owns a subsidiary, Eklutna Services, LLC, which was set up to become the development and management arm of the corporation. Both organizations are working to supply the local market with competi-

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tively priced aggregate products. The gravel site is situated on forty-three acres of land located southwest of the Eklutna Interchange on the Glenn Highway. The forty-three acre site is divided into areas for aggregate processing, asphalt sales, pit run gravel, and clean material disposal. Mass Excavation, Inc. plans

to include an on-site scale house and credit card processing. Summer site operations will remain open through October 15.

. Ukpeagvik Iñupiat Corporation (UIC) The Village Corporation of Barrow UIC provides social and economic resources to more than 2,500 Iñupiat shareholders, the majority of whom live in Barrow. UIC continually seeks projects that provide local employment opportunities for their people as well as work to expand the footprint of their diverse operations through various methods including teaming with other Alaska Native Corporations and tribal organizations. UIC Construction LLC was awarded a $7.1 million contract to perform major renovations to the Kali K-12 School in Point Lay. The work will include replacement of worn interior exterior finishes, code-compliance upgrades, replacement of the existing swimming pool, and mechanical and electrical upgrades. Pre-construction work has begun on the 40,730-square-foot school, which will be completed in three phases, allowing school activities to continue throughout

September 2013 | Alaska Business Monthly

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the entire renovation project. The scheduled completion date is October 31. Earlier this year, UIC Construction Services expanded its reach throughout the Lower 48 by opening offices in Seattle, Washington, and Phoenix, Arizona, thereby creating job opportunities for tribes in those regions. In addition, UIC Construction Services has expanded internationally opening a new construction subsidiary in Calgary, Alberta, Canada. The new company, UIC First Nations Construction Services, has developed a unique program to provide training and development to improve aboriginal labor opportunities. Matanuska Electric Corporation recently awarded to Rockford Corporation its Eklutna Generation Station Tank Project—a project value of $2.1 million. This project consists of the design and construction of two 500,000 gallon fuel oil storage tanks and one 365,000 gallon fire water tank at Matanuska Electric Association’s new power generation station located in Eklutna. The project is to begin late August, and will be completed by May 2014. Rockford also obtained a multi-million dollar contract with Crowley Marine to repair numerous tanks.

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SIKU Construction was awarded the Kenai National Wildlife Refuse Visitors Center contract in Soldotna. This design|build project is scheduled to begin in late 2013. Telephone and communications projects at the Los Angeles and Travis Air Force bases in California continued to be successful for SIKU and will continue in 2013. Kautaq Construction Services has opened an office in the Mat-Su Valley and entered into a two-year contract with the Knik Tribal Council Housing Authority to rehabilitate homes for tribal members there. Kautaq was also awarded the $1.9 million Anchorage Residential Sound Insulation Project for the Alaska Department of Transportation. UIC’s largest entity, UIC Technical Services and its Bowhead family of companies, has opened a new Western Regional Office in Las Vegas, Nevada. One of the first and primary responsibilities for this office will be to support the Program Management Office for the Nevada Autonomous Systems Institute, a privatepublic partnership established to promote the development, research and testing of unmanned autonomous vehicles and sys-

Alaska Business Monthly | September 2013

tems in the state of Nevada. Bowhead is working with the Nevada Governor’s Office of Economic Development as well as other partners in industry, military, and education on a bid to bring Federal Aviation Administration Unmanned Aircraft System testing sites to Nevada. Bowhead also has offices in Anchorage and Fairbanks, which provide a range of IT and telecommunications services. Bowhead Transport Company, LLC and Crowley Marine Services, Inc. have formed a joint venture to provide marine services in Alaska’s arctic. The new Alaska-based joint venture will operate under the name UIC Bowhead-Crowley, LLC. UIC Professional Services formed a new company called UIC Arctic Response Services, which provides a full range of incident prevention and response services to include onshore, near shore, and offshore operations to support the oil and gas industry. It also performs related equipment maintenance, training, and asset management. The joint venture of Worley-Parsons and Fluor (WP-F) is the engineering, procurement, and construction contractor for the ExxonMobil Point Thomson

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Project. The UMIAQ team is operating as part of the WP-F environmental and regulatory team supporting the engineering and construction teams during the three-year (2013-2016) construction phase. UMIAQ staff lead and support a suite of regulatory and environmental planning and compliance tasks, including development, refinement, and executing of the WP-F environmental management, regulatory compliance, waste management, spill prevention and response plans, and the field compliance management program.

Port Graham Corporation The Village Corporation of Port Graham Port Graham Corporation has been expanding the role of its shareholders as stewards of natural resources by branching out into the oil and gas industry through its subsidiaries, Windy Bay Services, LLC and PGC Energy Services— which, amongst other things, provide winter mooring and maintenance/ repair services for the Spartan jack-up rig, Spartan 151. Through this project, Port Graham Corporation hopes to earn the favor of other opera-

tors who are in need of support services and mooring facilities in the future. Another exciting current project is the partnership between Alaska Wildland Adventures and Port Graham subsidiary Port Graham Wilderness Adventures in operating their world-class Kenai Fjords Glacier Lodge.

Toghotthele Corporation The Village Corporation of Nenana The primary activity of Toghotthele Corporation is assisting Doyon in their project Nunivak #2. They subcontracted with Brice Inc., and built eleven miles of road that go to the drill site and are performing road maintenance throughout the summer, as well as providing transportation services and logistics for the project along with various partners. As of this spring, Toghotthele has also gotten into the timber industry through their newly formed LLC called Tog Timbers. Toghotthele trained several shareholders on how to build energy-efficient log cabins and arranged for these shareholders to get credit through University of Alaska for their training. One of the cabins was built right in the

yard of the corporation headquarters to demonstrate the finished product. People interested in having a cabin built will have access to qualified and experienced craftsmen, and those building the cabins themselves will have access to an experienced assistant in the event that they need one. Other activities of Toghotthele subsidiaries include various current and anticipated projects through its subsidiary Nenana gravel, leasing out a relatively new man camp in Nenana, equipment rentals through its subsidiary Tog Rentals, and two subdivisions in development: one called Nenana Valley View, and the other off Cosna Road south of Nenana. This year, Toghottele is taking a hiatus from LLC Tog Taters LLC, which was a project to grow and sell potatoes from clean seed so as to avoid tainting the farmland with blight and viruses. The project was shelved due to the public’s perceived extra expense of maintaining the integrity of the farmland for long-term use and healthy harvest and failure to consider rising food transportation costs. Toghotthele plans to re-start Tog Taters LLC at an unspecified future date. 

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special section

Alaska Native Corporations

The Continuing Evolution of Arctic Policy The state is slow to catch up with the world By Shehla Anjum Editor’s note: This article is the first in a series Alaska Business Monthly will publish regarding Arctic policy. It is a complicated subject with many entities and the writer has chosen to focus first on the local perspective. A glossary about each of the major organizations involved in Arctic policy is included.

ore than three decades ago— before the Arctic became a much talked about, much analyzed, and much sought after region on this planet—Eben Hopson, an Iñupiat leader from Alaska’s North Slope, observed: “The United States has no Arctic policy, as such.” Hopson was years ahead of his time, sensing that change in the Arctic would affect his own Iñupiat people as well as the world. Today the formulation of Arctic policy has become a mini industry. Conferences and meetings draw participants

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from universities, think tanks, industry, Arctic countries, and other nations that are interested in benefiting from the opening of the region. But in the mid-1970s, before the world became aware of how climate change affected the Arctic and how it would open new sea routes and areas for resource development, Hopson, the North Slope Borough’s first mayor, had an inkling of what lay ahead. He reacted to the changes within his own municipality wrought by the Prudhoe Bay oil development after he heard people in the villages near the oil fields speak about changing caribou migration patterns. And he knew the federal government wanted to sell oil and gas leases in the Beaufort Sea in 1979. As early as 1976, in testimony to the Canadian Berger Commission that was examining the effects of oil and gas development in the Mackenzie Delta, Hopson spoke of the need for an Arctic policy. He acknowledged the inevitability of both on-

Alaska Business Monthly | September 2013

shore and offshore development but also noted, “We feel that the special problems of the Arctic necessitate the development of an international set of Arctic policies.” In 1976 Hopson called upon the Inuit leaders of Greenland, Canada, the United States, and what was then the USSR to create an organization to represent their concerns and the point of view of the Arctic’s indigenous people. He wanted the group to lead in the creation of policies that allowed development of the region’s mineral and energy potential in a manner that also ensured the protection of subsistence resources. The North Slope Borough hosted the first-ever Inuit Circumpolar Conference in Barrow in June 1977; the event was only marred by the absence of Russian Inuit barred from attending because of Cold War politics. By 1980, the Inuit Circumpolar Conference had evolved into the Inuit Circumpolar Council (ICC). Today the ICC represents the www.akbizmag.com

155,000 Inuit and Yup’ik of Chukotka (Russia), Greenland, Alaska, and Canada, with offices in each country. The leaders of the circumpolar Arctic regions realized the need for an Arctic policy long before such a policy became institutionalized. The Arctic Environmental Protection Strategy (AEPS), the predecessor of the Arctic Council, was formed in 1991, when eight Arctic nations—Canada, Denmark, Iceland, Norway, the USSR, Sweden, Finland, and the United States— finally saw the need to address environmental concerns. By 1996 the AEPS had evolved into the Arctic Council. The Arctic Council is now a much larger group and is actively working to define Arctic policy. Today it comprises the original AEPS member Arctic countries, six permanent participants from indigenous communities, and permanent observers that now number ten, with the recent addition of China, India, Italy, South Korea, Singapore, and Japan. Increasing industrial development in the Arctic was the initial impetus behind the creation of the ICC. But within a few years another issue—climate change and its far-reaching impacts— also began to draw attention. While scientists had sounded the alarm about greenhouse gases and climate warming as early as the 1960s, the topic didn’t gain traction until temperatures rose sharply in the 1980s.

Watching Changes Occur The National Oceanic and Atmosphere Administration Arctic Report Card for 2012 noted that global warming is taking a toll on the Arctic, and the momentum of change is accelerating due to impacts of a persistent warming trend that started thirty years ago. The report noted that “sea ice extent in September 2012 reached the lowest observed in the satellite record (1979-present), with a related continued decline in the extent of thick multi-year ice.” While Arctic residents are apprehensive about how the accelerating loss of sea ice is affecting their way of life, others see only economic opportunity in the melting ice that has rapidly transformed the previously closed Arctic Ocean into a seasonally open ocean. Those opportunities include fishing, oil and gas exploration and production, port development and marine logistics, and shortwww.akbizmag.com

ened routes for shipping goods between ports in United States, Asia, and Europe. Not surprisingly, those who want to reap the perceived benefits from the Arctic also want to participate in the development of an Arctic policy. These include the indigenous people of the region, local corporations (in Alaska, the regional and village Native corporations), Arctic nations, and other nations such as Japan, Korea, China, and India. In 2012 the Alaska State Legislature formed the Alaska Arctic Policy Commission to address the risks and the opportunities that arise from increased activity. In the opinions of some, such as James Stotts, president of ICC Alaska, the state’s role or influence over Arctic policy is minimal and a bit late. Stotts, an Iñupiat, born and raised in Barrow, understands the coming challenges. He has been involved with the ICC since 1980 and has served as its chairman. He now speaks from a position of authority because the ICC is one of the six Arctic indigenous permanent participants on the Arctic Council. Alaska is not. It can only provide input to the US federal representative to the Council. The state can formulate a policy, Stotts says, but “it’s the federal policy that is important because so much of what is happening in the Arctic will be in the oceans where the state has no jurisdiction beyond its three-mile limit.” In Stotts’ view there is no question that the policy for the Arctic should be shaped in cooperation with other Arctic states. He notes rightly that the Arctic Ocean is surrounded by land and what happens one place affects other places that surround that ocean. “Setting policy is clearly national and international game and the state’s role is more of feeding ideas to federal and international bodies,” he says. Charlotte Brower, the Mayor of Alaska’s North Slope Borough, wants to see the people of the Arctic more directly involved in the discussions. “There should be a permanent seat at the table for us as this policy is being made,” she says. In regards to the Alaska Arctic Policy Commission, Brower emphasizes that it was formed without consultation from the local governments. She points out that the Commission’s only member from the North Slope, former North Slope Borough Mayor Jacob Adams, is

just an alternate. “But I know that an alternate is not engaged in every meeting. I also know that Jacob Adams’s wisdom and his knowledge of Arctic policy is greater than anyone else seated on the state’s Arctic Policy Commission.” In its 2011 session the Alaska Legislature failed to extend the state’s coastal management plan, making Alaska the only coastal state in the country without such a plan. A citizens’ initiative that put the issue to Alaska’s voters in the 2012 elections also failed. By failing to extend the coastal management program, the state lost a chance to influence federal policy in offshore waters beyond the state’s three-mile territorial limit, particularly in light of the coming development activity in the offshore Arctic. Rep. Ben Nageak of Barrow, a former mayor of the North Slope Borough whose House district 40 spans northern Alaska, is also concerned about the state’s inability to effectively influence federal policy. “Today, without a state coastal management plan, all local coastal policies are moot,” he says. “The coast is changing rapidly and we need to manage its changes, we need an instrument to work with federal and state governments and with industry. “The effects of climate change reach far beyond the melting of sea ice. We have to fight coastal erosion, and encroachment of ocean water into the tundra, lakes, and ponds,” he says. However, Nageak is well aware that changes in the Arctic will also create opportunities for its people. The opening of the Northern Sea Route could lead to development of ports, and that in turn would help decrease the cost of living in the Arctic through goods arriving directly to coastal communities. Local input is of utmost importance for Brower also, who spoke of her frustration about the lack of federal and state cooperation. “We will create our own Arctic Policy Commission. We do not want people who do not live in our region, who do not know what is impacting us on a daily basis, to make decisions on our behalf,” she says.

Who is Most Affected Three northern Alaska regional corporations and several village corporations

September 2013 | Alaska Business Monthly

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Glossary of Key Organizations

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Inuit Circumpolar Council (ICC): A non-governmental organization and an Indigenous Peoples Organization that represents Inuit and Yup’ik of Alaska, Greenland, Canada, and Chukotka, Russia. The ICC got United Nations Economic and Social Council accreditation in 1983 and can have observers and participants at UN meetings and sessions. The ICC is also a permanent participant on the Arctic Council with full consultation rights in decisions and negotiations.

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North Slope Borough: A home-rule municipality on the North Slope with a population of about 9,500. It has been involved in oil and gas permitting issues and has negotiated successfully on several development issues. Most of its Iñupiat population has a long history of traditional subsistence on land, fresh water, and ocean.

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Alaska Native Corporations: Several Alaska Native regional and village corporations own coastal lands that are affected by changes in the environment and increasing commercial use of the Arctic. The affected regional corporations include Arctic Slope Regional Corporation in the north; NANA Regional Corporation in Northwest Alaska; Bering Straits Regional Corporation on the Seward Peninsula and Norton Sound; and Calista Corporation and Aleut Corporation in Southwest Alaska. Active village corporations include Olgoonik Corporation and Bering Sea Alliance LLC, a jointventure of ten Bering Straits villages.

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Alaska Arctic Policy Commission: A state commission formed by the Alaska Legislature in 2012 to seek public input in Arctic policy issues and to present position statements to the US representatives on the Arctic Council. Unlike the indigenous peoples’ representatives, the state of Alaska

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has no ofﬁcial voice at the Arctic Council but makes its views known through the US delegation.

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Arctic Council: An international organization of nations that share the Arctic. Eight member nations include Canada, Denmark, Finland, Iceland, Norway, Russia, Sweden, and the United States. Six Arctic indigenous groups have permanent participant status, including the Aleut International Association, Arctic Athabaskan Council, and Gwich’in Council International. Nations can be ofﬁcial observers of the Arctic Council as well as members, and China, India, Japan, South Korea, and Singapore were recently designated as observers, allowing them attendance at Council meetings and working groups of the Council.

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US Arctic Research Commission: An advisory commission of citizens and scientists who advise federal agencies on Arctic research priorities. Fran Ulmer, a former lieutenant governor, is current chair of the Commission. The Commission submits annual recommendations to federal agencies and also issues periodic reports of its own, one recent report being a summary of oil spill studies in the Arctic. The Commission includes recommendations on the well-being of indigenous people, in particular on health and the status of indigenous languages.

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Arctic Circle: Alice Rogoff, publisher of the Alaska Dispatch, and Iceland President Ólafur Ragnar Grímsson are the two leading members of this nonproﬁt group formed in 2013. The group aims to bring together Arctic policy think tanks, indigenous groups, and government organization to address such issues as declining Arctic sea ice, increased shipping, and development of natural resources. The group will hold its ﬁrst meeting in Reykjavík in October.

Alaska Business Monthly | September 2013

own land along the coast that could be affected by changes in the Arctic. Some of the corporations own lands or are negotiating for transfer of lands that could serve as potential ports for support of Arctic maritime activities. Teresa Imm, Arctic Slope Regional Corporation’s vice president for Resource Development, acknowledged that ASRC is considering the development of an Arctic port at Cape Thompson to export the corporation’s coal near Point Lay. Another corporation looking at port development is Bering Straits Native Corporation at Port Clarence on the Seward Peninsula, which is also one of the sites selected by the US Army Corps of Engineers as a potential deep-water port. Bering Strait Native Corporation’s vice president of natural resources Matt Ganley says it is expected that 30 percent of China’s exports will travel through the Northern Sea Route by 2030. So far this year, the Russian Northern Sea Route Administration has permitted 213 shipping trips, up from 46 in 2012, 34 in 2011, and 4 in 2010. According to Liz Qulluq Moore, senior director for community and government affairs, NANA is also looking at a port. “We are very focused on developing Cape Blossom, near Kotzebue, as a regional port,” Moore says. Its location between the Bering Straits and North Slope makes Cape Blossom an ideal location as an alternative facility or another facility for the Coast Guard or other Arctic marine transportation, she says. If there is one message that comes across clearly from the local and corporate leaders of the Arctic, it is this: Arctic policy cannot be formulated without the active participation of the people who have lived there for thousands of years. That development must include safeguards for the protection of subsistence species and a way of life and culture that has survived through many changes. “I hope that through all changes that are coming our way, our life and culture survives. We have survived industrial development, climate change, and all else that is occurring by adapting and we will continue,” Stotts says.  Shehla Anjum writes from Anchorage. www.akbizmag.com

special section

Alaska Native Corporations

Alaska Native Education and job opportunities for Rural Alaskan pilots

ith nearly 250 state-owned airports and countless private airstrips in the state, most of them providing access to villages far from any road system, it only makes sense that Alaska Natives—many of whom grow up with more exposure to airplanes than other popular modes of transportation—would make up a portion of the aviation industry that reflects this consistent exposure. However, education opportunities for people in the Bush are few and far between. One organization that has been addressing this need since January 2004 is Yuut Yaqungviat, LLC, a flight school in Bethel. According to their mission statement, Yuut Yaqungviat is dedicated to training skilled and competent professional pilots utilizing the highest of safety and ethical standards and provides local training opportunities designed to meet industry specific employment needs. Featuring portraits of their students who recently reached important milestones in their educations, usually flanked by flight instructor Roberto Guererro and FAA Designate Pilot Examiner Michael P. Buckland, the home page of Yuut Yaqungviat flight school in Bethel is both a celebration of achievement and a testament to the school’s investment in the economic productivity of the region’s population. According to Executive Director James Amik, “Most of our students are from the YK Delta and other regions of Alaska. The flight school provides training to students in the environment they will be flying in as professional

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Photo courtesy of Yute Air

By Mari Gallion

Pilot Abe David has been ﬂ ying professionally since 1981 and has been with Yute Air since 2007.

pilots. The students are from here and they will want to stay and make flying a career here close to home.” Yuut Yaqungviat has an average annual enrollment of ten students, the majority of whom have goals of becoming commercial pilots. There are more than 250 full-time commercial pilot positions in the region; 92 percent of the graduates of the commercial certification program are currently flying professionally for Era Aviation, Grant Aviation, and Yute Air Alaska. According to Amik, “Era Aviation has committed to hire each and every graduate that comes out of the flight school.” However, as Amik adds, it is up to the graduates to do their part to prove themselves as worthy employees and grow in their skills as pilots with their continued experience. It is an opportunity to be taken very seriously. “Training and retention of local pilots in the region promotes the local economy with long-term jobs, enhancement of ground crews, and village support agents,” Amik says, touting a stream of the program’s benefits for the region’s economy and population. “The program offers quality employment opportunities for young adults in the region and promotes healthy val-

Alaska Business Monthly | September 2013

ues. People who grew up in the region will offer the best service as pilots with their familiarity with the terrain and having logged many hours benefits local airlines. This results in safer flight outcomes for passengers of the region and fewer turnovers. People feel safe and comfortable flying with someone they know.” As Amik points out, people from Rural Alaska have a better understanding of what local aviation jobs entail, a greater sense of civic responsibility to their neighbors, and a larger appreciation for the opportunity than nonresidents. “The turnover of nonresident pilots, support positions in ticketing, ground support, and dispatch positions has been an issue encountered by the [regional] air service industry.”

Walking the Talk Bethel-based Yute Air is one airline that makes a point of providing opportunities for Alaska Native pilots, as well as graduates of Yuut Yaqungviat school. According to Operations Manager Dan Knesk, “Yute Air feels it is important to have as many local pilots as we can because their families are our business. The locals are our main customers and Yute Air would not exist without www.akbizmag.com

them. It is our goal to provide comfortable, long-term, well-paid jobs to as many local people as we can. Yute Air has been known as the ‘Wings of the People,’ and we take that very seriously with everything we do.” So seriously, in fact, that the airline makes efforts to cultivate their own pilot pool. “We are currently working on a partnership with a couple of local businesses to help new local pilots gain enough experience to meet the FAA Requirements and then move into a Captain position with Yute Air,” Knesk says. “We are hoping that this partnership will provide another choice for prospective local pilots to attain a flying job with Yute Air which will allow them to serve the villages of their friends and families. “Over the last few years, the majority of our pilots have come from personal referral of some manner. We generally don’t advertise pilot openings since we usually can fill any open slots through the referral process.”

Meet the Pilots While Knesk says it’s not in the culture of the people of the YK Delta to brag, Knesk has strong words of praise for the Alaska Native pilots that work for Yute Air, only one of whom, Christian Samuelson, was not available for comment. “Samuelson started working for Yute quite a few years ago but took a couple years off from Yute and flew for another carrier,” Knesk says. “Luckily, he came back to Yute Air last April and has brought a wealth of knowledge and experience. Samuelson has been flying in the YK Delta for approximately ten years. “Tristen ‘Buggy’ Carl has been a pilot with Yute Air since August 2008,” Knesk says. “Carl is a graduate of the Yuut Yaqungviat Flight School in Bethel. He is one of our most senior pilots. When Carl is on shift he takes his assigned aircraft to his home village of Kipnuk every night so he can be home with his young son. Carl is also the pilot representative on the Event Review Committee of our Aviation Safety Action Program in which we partner with The Medallion Foundation and the FAA.” “Growing up, I had tons of exposure to the aviation industry because many of my family members worked as agents for numerous airlines out here,” Carl says, subsequently rattling off a www.akbizmag.com

series of former airline companies that long-time Alaskans may remember, including Mark Air, admitting that he can’t remember them all—there were so many. “When I was really young, I used to follow either my uncle, grandpa, or my mother to the airport to go meet the airplane,” Carl says, “and used to watch the pilots land, and our agents would greet the pilot. And that got me excited. My grandpa used to wait until they took off, and I’d wait there with him, and watch them take off.” Carl loves what he does, and says it’s a great job for people who like to travel and want a steady, well-paying job—but he stresses the importance of an aspiring pilot’s education, as “lots of reading and math” is involved. Pilot Abe David has been flying professionally since 1981, and has been with Yute since 2007. David is from Mekoryuk, a village on Nunivak Island, and acquired his commercial training at Village Aviation flight school in Anchorage through a program run by his village corporation. He is also on the village counsel for Mekoryuk. He has lived his entire fifty five years in Alaska and has never left the state. “Airplanes were a big thing when we were kids,” David says. “Whenever we’d hear that someone is coming from a distance, most of the kids in the community would gather up and try to see who would get there first. Once they arrived, everyone would come from the village and rally round, go down and meet the plane. The different planes that would come were amazing to see.” What David enjoys most about his job is being able to work outdoors. “I take people out on hunting trips, fishing trips, all the outdoor stuff,” he says. “The outdoors is one of my specialties; You get to meet a lot of people, and you’re serving your own people in the area.” David encourages Alaska Native people to get started on their careers early if they want to be pilots—a job with income, adventure, and prestige is available for those who are willing to put their minds to it. He urges them to believe in themselves and push for what they want. “These folks out here out in the YK Delta are smart people,” David says. “They just need to put their minds to-

Photo courtesy of Yute Air

Tristen Carl graduated from Yuut Yaqungviat in 2007 and is currently working as a pilot for Yute Air.

gether. I’m just like anybody else. I’m just a human being trying to make a living. When I put my mind to something as an individual, even if I don’t have much education, I can get things done. It’s just a matter of doing it. Put your mind to it, go for it, and it can be done.”

Safety is Success James “Gundo” Hoffman is the chief pilot for Yute Air. “I am a third generation pilot, so I had relatives that flew for Wien Air Alaska,” Hoffman says. “My grandfather flew for them, started in 1947 [and worked for them until] 1971—and then my dad was a private pilot, and my uncle was a long time employee for the original Era. “I was roughly thirteen or fourteen when my dad started to teach me some of the basic things about flying,” Hoffman says. “I always had an interest in it from a young age.” Forty-one year-old, Bethel-born and -raised Hoffman admits that like many Alaskan aviation enthusiasts who grew up in the seventies, he still owns a Wien Air poster that features a Canada goose wearing an aviator hat, but it’s at his mother’s house. “My mom can’t seem to tear down the old stuff from me and my brother—all the Wien memorabilia. Even when I flew the 737s for Northern Air

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Cargo, my tie pin was a Wien Air Alaska tie tack.” Unlike the other Alaska Native pilots at Yute Air, the bulk of Hoffman’s formal aviation training occurred Outside. “My private pilot I got in Anchorage, the instrument ratings I got in Washington DC, my commercial in Arizona, and my multi engine also followed in Seattle,” Hoff man says. His training Outside was the result of no local fl ight school at the time he trained, and was paid for in part by his Native councils. According to Hoffman, safety is a main focus for the pilots that fly at Yute Air. “Flying is fun, but it’s not to be messed around with, especially in the conditions that we find out in Western Alaska,” Hoffman says. “So we take it seriously and try to make it as fun as possible in the proper safety arena that is required for what we do.” But when it comes to safety, Hoffman says that pilots trained in Western Alaska have an experiential edge over those trained in milder climates due to the region’s exceptional weather patterns and featureless terrain.

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“I would put a pilot who is successful in that area up against a pilot who is successful anywhere in the world,” Hoffman says. Hoffman also points out that Alaska does not have to be the final stop for Alaska Native pilots who would like to work Outside. “I was a Bethel kid and I got to fly 737s,” he says. “Now I am able to teach people who are and are not familiar with our region those things that I think will help them.”

What Makes a Pilot Good Working for an airline requires employees to have a larger-than-average commitment to performing their jobs well— a commitment that comes easy for most Rural Alaskans based on their relationships with their fellow residents and understanding of Alaska’s challenges. All the educators, managers, and pilots interviewed for this article agree that their greatest investment is in a combination of components that make up the Rural Alaska aviation community: education, jobs, residents, and a commitment to safety that is strengthened by local ties.

Alaska Business Monthly | September 2013

“If I don’t know a passenger for Yute Air,” Hoffman says, “chances are that I do know someone who knows them.” David expresses a sense of responsibility and belonging with his job and his community. “I’ve never been outside the state,” he says. “I’ve been here my whole life—fift y five years—and I’ve never been outside the work area that I they put me in, and I have no interest in living in any place else because I was chosen to serve my folks here: my people.” “To me, a successful pilot is one who makes it home to his family each and every night,” Hoffman says. “It’s their job to do their very best to give our passengers the best possible chance to come home to their families as well.”  Mari Gallion is Associate Editor at Alaska Business Monthly.

www.akbizmag.com

Alaska Native Corporations special section

Alaska Humanities Forum’s Rose Urban Rural Exchange Connecting communities, building cross-cultural ambassadors By Laurie Evans-Dinneen

‘Develop Understanding and Insight’ The Rose Urban Rural Exchange/Sister School Exchange program began in www.akbizmag.com

Photo courtesy of the Alaska Humanities Forum

he modern generation of Alaska’s youth finds themselves as connected as any youth in the Lower 48 with cell phones, high speed internet, and more television channels than their parents ever dreamed possible. Alaskans also have no shortage of cross-cultural opportunities given all the tourists who visit the state each year in urban and rural communities. However, outside of hunting and fishing trips, most urban folks never make it out to rural Alaska to understand those communities—and similarly, most rural folks come to town to shop or visit relatives rather than living the pace and routine of urban families. This sometimes leads to difficult discussions over important statewide concerns: subsistence rights, education funding, or health care. The Alaska Humanities Forum is building young states-men and -women, through its Rose Urban Rural Exchange (RURE) programs, to be cross-cultural ambassadors who learn about their own culture which leads to exploration of other cultures. The Forum’s Sister School Exchange program pairs urban and rural middle and high schools to give the students a glimpse into the lives and communities of their peers. They spend one week living with host families—go to school, eat meals together, meet culture bearers, attend church—and they explore areas of concern in the community, such as climate change, alternative power, local governance, and other educational/cultural issues that lead to understanding life in a community.

A group of cross-cultural ambassadors checking out a ﬁ ghter jet at Joint Base Elmendorf-Richardson as part of the Alaska Humanities Forum’s Rose Urban Rural Exchange.

1999 with a grant from the US Department of Education under the Alaska Native Education Equity Act program funds. The impetus for the program proposal was the Urban Rural Unity Study (September 2000) conducted by Commonwealth North to address issues of importance to the state and to provide insight that would lead toward a “unified vision of Alaska’s future.” While the state was grappling with subsistence at that time, then Senator Ted Stevens was discussing the issue with his Chief of Staff, Mitch Rose, of Anchorage (currently a government relations consultant in Washington, DC). Rose remarked that when he was young, his mother had to work in Bethel for an extended time, so she enrolled him in the Bethel elementary school. “We were only there a short period,” Rose said, “but when we left, my Native friends threw a party for me.” He told the Stevens that if “urban folks could get out to rural Alaska to see

how those folks live, that they would understand some of these concerns.” Stevens was inspired and sought additional funding for the program—and credited Rose for the idea through the program’s name. “It is my hope that through the [RURE] program, our young leaders of tomorrow from our villages and our cities will be able to share their concerns and develop understanding and insight into how best to work together for the future of our state,” Stevens stated in an RURE program brochure.

‘Modern Sense of Exploration’ The program just finished its thirteenth year; nearly 1,300 students and more than 300 teachers have become crosscultural ambassadors, and nearly 3,000 students have participated in the class curriculum from which the traveling ambassadors are selected. Once teachers sign up to lead a cross-cultural exchange, they are oriented to the

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curriculum and website (roseurbanruralexchange.org/destinationlog). Program Manager Veldee Hall, program veteran of four years, has seen the program grow to its potential. “Technology, the use of a website blog and flip cameras, has connected students with a modern sense of exploration and the community at large. The most important aspect of the program has been the ability to sweep away the barriers teenagers create on multiple social levels—school, family, and community.” Schools are paired up—sixteen urban and sixteen rural—and work through the Destinations cross-cultural curriculum that introduces the teams to each other in a secure online environment. Hall guides teachers as they are preparing for the Exchange and she vets all of the online posts for more than 150 students. Over the six weeks of the online curriculum, students explore their culture and community through posting personal profiles, community profiles, and understanding the ten elements of community life—places where culture happens—such as food, shelter, educa-

tion, transportation, and cultural expressions. Then they look to their sister school community. In its cross-cultural programs, the Forum holds the belief that one cannot truly explore another culture without first understanding one’s own culture. The curriculum is currently being aligned with the Alaska State Education Standards for reading, writing, math, and Alaska studies, as well as the cultural and social-emotional learning standards.

Exceptional Experiential Approach The Sister School Exchange program is an exceptional approach to fostering cultural competence because it is hands-on and experiential versus entirely text-based. Engaging in guided critical analysis and evaluation of cultural differences is more effective in improving students’ intercultural sensitivity than simply studying a curriculum about cultural differences. In 2012, the Forum conducted a longitudinal study on the long-term impact of students and teachers. Program evaluator Dr. Dale Cope

AN ALASKA MINING PROJECT COMMITTED TO: LOCAL HIRE RESPONSIBLE DEVELOPMENT ENVIRONMENTAL INTEGRITY

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noted, “The Rose Urban Rural Exchange programs are a powerful and effective way for individuals to increase their cultural competence. Participants in the longitudinal study were quite frank... In all cases, participants attributed positive change to the RURE experience.” This positive movement is the difference between experiential and textbook learning. Former Principal Jeanne Fisher, recently retired from Nicholas J. Begich Middle School in Anchorage, is a supporter of the RURE programs. “When traveling and learning in a new place, it seems to be human nature to examine the differences and similarities…. It is the differences that give a culture its character, enriching our world and, in the process, enriching us.” And these are the aspects of the exchange that students post: assumptions they hold, things they’ll miss, and reflections. One of the urban students, 2007, in the study noted, “Rural Alaska is so different from anywhere else... These guys became my friends. They are very real, and that plays into thinking about people emotionally and intellectually because you can’t have one without the other.” An example is the long standing pairing of Wasilla High and Yakutat High School. When Yakutat was in the basketball finals in 2007, the Wasilla High Pep Band played for them at the games. That makes it real. Floyd Dryden Middle School in Juneau is a model school. It has supported three teams in a year in an effort to have every Alaska Studies class involved in an exchange. In rural Alaska, it is not uncommon for the whole school to participate, and the entire community is involved with community dinners or hosting students. Many urban schools open up their classes or host a welcoming assembly. Fisher encourages teachers to participate in the Sister School Exchange as well as the Forum’s Educator CrossCultural Immersion program. In her address at the Educator Cross-Cultural Immersion program Alumni Gathering in April, Fisher stated, “By being totally immersed in a new environment and culture away from familiar surroundings, you have the time and energy to observe and reflect. You are open to new learning.” www.akbizmag.com

Activities that Create Knowledge Again, the most powerful learning comes from direct experience in a social setting and in an implicit/explicit exchange that includes daily debriefing and reflection. These are the activities that create knowledge. John Townsend, a Russian Mission teacher who has lead four Exchanges, speaks to the experiential learning. “My students learn their cultures are special,” he says. “When you share your culture with someone and you see they are excited, you realize that you have something cool to share with others.” Russian Mission has been paired with Ryan Middle School in Fairbanks for seven years. Veteran Exchange teacher Chelsea Hicok remarked in her post, “I want to avoid the word stereotype at this moment as my students are just realizing that what they think ‘regular’ life is like for urban students is a stereotype. I want them to come to that conclusion without me forcibly telling them.” Hicok is from Napaskiak, and she and Ben Eielson High teacher Liz Hursh in Fairbanks have been paired for six

years—it would be seven, but Hursh took off a year to get married. “My students might be more comfortable on the tundra than in a department store, but their worries, hopes, and fears are often the same,” Hicok says. “RURE reminds me to appreciate my students and that they often have as much to teach me as I have to teach them.” Truly, the students say it best in their blogs and videos. Erik, from Begich Middle School, did the Exchange with Chevak this year. On his last day, he blogged about his return to Anchorage. “This was the moment that made me realize that my experience with [RURE] helped me not only learn about the culture of Chevak but helped me see a whole new way of life.” And, in return, an excited Edgar from Chevak wrote, “I am glad we get to see each other again! I have learned something while I was there, now I learn something while I am here! Erik, you are just like my big young brother, I am thankful for this Exchange to let us meet amazing new people!” The RURE program connects Alaskans one student, one family, and one community at a time. The future

of Alaska is in their hands, and if the Alaska Humanities Forum keeps doing things right, there will be remarkable young leaders promoting dialogue and community discussions that build knowledge and understanding between Alaskans.  Laurie Evans-Dinneen has been in Alaska since 1992 and is the Director of the cross-cultural immersion programs at the Alaska Humanities Forum. She received her MFA in Poetry from the University of Oregon in 1990 and has written for various publications, including Anchorage Magazine and the Forum. With over twenty years of experience in nonproﬁt management and working with Alaska’s unique and diverse populations, Evans-Dinneen continues to teach the Essentials of Grant Proposal Writing course for Alaska Paciﬁc University, as well as to coordinate program development and projects for the Alaska Humanities Forum.

Some call it harsh, we call it home. UIC is committed to building relationships with industry and communities to explore opportunities that advance environmentally responsible development.

Your Arctic experts.

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special section

Alaska Native Corporations

Photo courtesy of Coastal Villages Region Fund

Seashares

Coastal Villages Region Fund operates commercial boats such as the North Sea in the lucrative Bering Sea crab ﬁ sheries. From left to right, crewmen Thomas John, of Newtok, and Norman John and Jerry Tulik, both of Toksook Bay.

or more than twenty years now, an obscure federal program has been generating extraordinary wealth for Western Alaska, a remote and sparsely populated region not known for economic prosperity. The program draws its power not from the land, but the sea. It’s based on commercial fishing quotas, or catch shares, reserved for coastal communities. Nonprofit companies harvest the quotas on behalf of sixty-five villages from the Bering Strait to the central Aleutians. The companies have amassed combined assets approaching $1 billion, investing heavily in fishing vessels, processing plants, and additional fishing rights. They say they’ve created scores 114

An Alaska rural development program ﬂourishes, though not without controversy By Wesley Loy

of jobs and showered the villages with hundreds of millions of dollars in direct wages, scholarships and training, payments to resident fishermen, and grants for local projects. Within the state’s enormous seafood industry, the Western Alaska Community Development Quota Program (CDQ) has become a big fish. To a significant degree, the program is actually shifting control of the industry to Alaska from its historic base in Seattle. In that regard, the state’s elected officials view the CDQ program as a winner and have passed legislation over the years to strengthen it. The program is not without problems, however, perhaps reflecting its relative youth. The group of six CDQ

Alaska Business Monthly | September 2013

companies is prone to infighting. Critics question whether the companies are doing enough to help the villages and say the size of some executive paychecks is scandalous. Further, many villagers are appalled the CDQ companies own trawl vessels that, in pursuing other species, kill thousands of cherished king salmon. Supporters stress the program is making a real difference in villages long plagued with unemployment, alcohol abuse, and youth suicide. “When I was young, I was always against company towns. Now I’m building one,” says Larry Cotter, chief executive of one CDQ company spending $15 million to expand a fish processing plant at False Pass. www.akbizmag.com

How it Started Implemented in 1992, the CDQ program grew out of work at the North Pacific Fishery Management Council. The Anchorage-based council helps regulate the federal fisheries off Alaska and has members from Alaska, Washington, and Oregon. For the most part, the industrial fisheries in the Bering Sea had developed without the involvement of Western Alaska villagers. It was difficult for them to watch the lucrative harvests off their shores with no means of getting involved. Under the new program, a percentage share of the fish available for harvest each year would be reserved as community development quota. Six nonprofits formed to manage the CDQ harvest and administer the proceeds. Each represents villages within specific regions: the Nome area, the Yukon River delta, the Kuskokwim River delta, Bristol Bay, St. Paul Island, and the Aleutians. The CDQ program is not a Native program per se. But Native faces dominate the boards and even the executive ranks of the CDQ companies.

Much of the CDQ revenue comes from pollock, the largest fishery in the Bering Sea and one of the largest in the world. Ten percent of the annual pollock catch limit is allotted to the CDQ program, along with shares of other species such as cod, sole, halibut, sablefish, and king crab. To supporters of the CDQ program, designating a portion of the Bering Sea fisheries exclusively for coastal communities is right and just. Why should fishing and processing companies with corporate headquarters in Seattle or Tokyo reap all the profits? People who championed development of the CDQ program were recognized last year at a 20-year anniversary celebration in Anchorage. Among them: the late U.S. Sen. Ted Stevens, the late Harvey Samuelsen of Dillingham, former state senator and “fisheries tsar” Clem Tillion of Halibut Cove, and former Anchorage banker Ed Rasmuson. Not everyone welcomed the CDQ program. Some fishermen resented the establishment of community quotas, as this would shrink the pool of fish and crab available for regular commercial harvest.

Today, some believe the CDQ program is transforming the fishing industry unfairly. In 2011, a group of people prominent in Seattle commercial fishing circles wrote a fifteen-page “appeal” to Washington and Oregon political leaders warning that an industry rooted in those states was being hijacked to Alaska. The group cited Alaska’s voting majority on the North Pacific Council, and the “huge financial war chests” the CDQ companies had built. “With the advantage of their taxexempt status, CDQ organizations have become predatory in acquiring fishing opportunities and segments of the industry,” the group wrote. Maybe so, but it’s also evident the CDQ companies have found plenty of willing sellers and business partners. They’ve bought into top fishing and processing companies such as Alaskan Leader Fisheries, Glacier Fish Company and Ocean Beauty Seafoods. In fact, revenue from such investments now far exceeds the royalties collected on the harvest of the community development quotas.

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AT A GLANCE: Alaska’s six Community Development Quota companies ■ Aleutian Pribilof Island Community Development Association

Headquarters: Juneau Member villages: Akutan, Atka, False Pass, Nelson Lagoon, Nikolski, St. George Total assets: $70.7 million Notable holding: Signiﬁcant stake in the Bering Sea factory trawler Starbound Chief executive pay: Larry Cotter, $325,000 plus $100,000 bonus

■ Bristol Bay Economic Development Corp. Headquarters: Dillingham Member villages: Aleknagik, Clarks Point, Dillingham, Egegik, Ekuk, Ekwok, King Salmon, Levelock, Manokotak, Naknek, Pilot Point, Port Heiden, South Naknek, Togiak, Twin Hills, Ugashik Total assets: $205.5 million Notable holding: Half interest in Ocean Beauty Seafoods Chief executive pay: Robin Samuelsen, $106,334 plus $10,500 bonus

■ Central Bering Sea Fishermen’s Association Headquarters: St. Paul Member village: St. Paul Total assets: $86.5 million Notable holding: Minor stake in American Seafoods Chief executive pay: Phillip Lestenkof, $160,741

■ Coastal Villages Region Fund

Headquarters: Anchorage Member villages: Chefornak, Chevak, Eek, Goodnews Bay, Hooper Bay, Kipnuk, Kongiganak, Kwigillingok, Mekoryuk, Napakiak, Napaskiak, Newtok, Nightmute, Oscarville, Platinum, Quinhagak, Scammon Bay, Toksook Bay, Tuntutuliak, Tununak Total assets: $312.5 million Notable holding: Full ownership of the Bering Sea factory trawler Northern Hawk Chief executive pay: Morgen Crow, $475,000

■ Norton Sound Economic Development Corp. People who know, know BDO.SM

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Headquarters: Anchorage Member villages: Brevig Mission, Diomede, Elim, Gambell, Golovin, Koyuk, Nome, St. Michael, Savoonga, Shaktoolik, Stebbins, Teller, Unalakleet, Wales, White Mountain Total assets: $186.2 million Notable holding: Major stake in Glacier Fish Co., operator of three Bering Sea factory trawlers Chief executive pay: Janis Ivanoff, $160,102

■ Yukon Delta Fisheries Development Association

Headquarters: Anchorage Member villages: Alakanuk, Emmonak, Grayling, Kotlik, Mountain Village, Nunam Iqua Total assets: $77.1 million Notable holding: Kwik’pak Fisheries, a Yukon River processing company Chief executive pay: Ragnar Alstrom, $157,750

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www.akbizmag.com

Source: 2011 annual reports

“We’re bringing in BDO. The partner’s already on it.”

‘Work, Fish, Hope’ The CDQ companies vary in size. The biggest and most aggressive is Coastal Villages Region Fund, which claims to be “the largest Alaskan-owned seafood company in history.” Headquartered in a downtown Anchorage office building, Coastal has twenty member villages in the Kuskokwim region including Chevak, Hooper Bay, Kipnuk and Quinhagak. Morgen Crow, a lanky former school administrator from Bethel, leads the company. His top lieutenant is Trevor McCabe, a former fisheries aide to Stevens. In 1997, before Crow’s arrival, Coastal nearly went bust after a bad investment. Now the picture is very different. The company reported 2012 revenue of $115.4 million and owns a fleet of fishing vessels including the 341-foot pollock factory trawler Northern Hawk, which Coastal took from its former stake in Seattle-based American Seafoods. Coastal says the communities it represents are some of the poorest of the villages covered under the CDQ program. The company is fond of coining slogans. People Propel. Pollock Provides. Work, Fish, Hope. As with the other CDQ organizations, Coastal is injecting cash into its communities in a variety of ways. The company subsidizes money-losing local herring, salmon, and halibut fisheries with its Bering Sea pollock, cod, and crab revenue. In 2009, Coastal opened its new $35 million Goodnews Bay regional seafood processing plant and this year paid workers $10 an hour to start, which the company says is best in the industry. Coastal is pursuing a plan to further “Alaskanize” the industry by homeporting the company’s fishing fleet in Seward rather than Seattle. This would require major improvements to Seward’s harbor. State legislators have contributed preliminary funding, including $10 million last session. Another Coastal initiative is causing conflict. Although it already holds the largest share of pollock community quota, Coastal is demanding a bigger cut of this and other species. The company complains that, based on regional popuwww.akbizmag.com

lation size, other CDQ organizations enjoy disproportionately large shares. “We serve the most economically challenged people in the CDQ program, and we are not even close to catching up with what the other CDQ groups have as a result of their excessive CDQ allocations,” Coastal board member Harry Tulik, of Toksook Bay, said in a May press release. Coastal villagers have been wearing T-shirts with yet another company slogan: Just Fix CDQ. The other CDQ companies, calling themselves the “united five,” haven’t

taken kindly to Coastal’s quota rebalancing campaign. Congress set the current split of community development quota in 2006, settling what had been years of squabbling among the six companies. In June, Alaska’s bipartisan congressional delegation signed a letter saying any CDQ program adjustments would need the unanimous support of the groups.  Wesley Loy is a journalist living in Anchorage.

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special section

Alaska Native Corporations

Making Leaders How a straight line and a winding road can lead to the same place By Mari Gallion

Photo by Sons and Daughters Photography

Megan Moore models a Killer Whale Clan inspired dress by Tlingit artist Maria Williams at this year’s Clare to Clare fashion show to beneﬁ t Clare House.

Leaders are made, they are not born. They are made by hard effort, which is the price which all of us must pay to achieve any goal that is worthwhile.” —Vince Lombardi “

lthough it seems everyone from Vince Lombardi to Colin Powell to countless life coaches adhere to the belief that great leaders are made rather than born, today’s emerging Alaska Native leaders seem to demonstrate that people meet their destinies in diverse ways.

Shauna Hegna Shauna Hegna, Vice President of Shareholder Services for Afognak Native Corporation, has held many positions that seem to have taken her in a straight line to Alaska Native leadership: Hegna spent much of her career working for RurAL CAP, first as a community service coordinator and later for several years as the deputy director, where she led their subsistence and tribal issues advocacy, development, and 118

communications initiatives. Hegna also worked for the Alutiiq Museum in Kodiak where she planned a regional Alutiiq language revitalization program. Despite the various jobs and experiences that have brought Hegna to her leadership position, her mission has always remained focused. “Over the years, my career has taken me down different paths, but one constant has remained—I have always served my community in some way.” When asked whether her leadership position was the result of a strategic plan or a series of opportunities, Hegna admits that it was “a little bit of both.” “When I was growing up my father used to tell me and my sisters, ‘you will go to college and get a degree so that you can help our people,’” Hegna says. “We knew from a young age that it was our responsibility to serve our community. “Setting long-term goals and defining what you need to do to reach them has helped me grow in my own career. “I attended UAA and received a bachelor’s

Alaska Business Monthly | September 2013

degree in history,” Hegna says. “While history has always been a topic I enjoyed, my Alaska Native Studies minor was my passion. By the time I completed my undergraduate degree, I had foundational knowledge in Alaska Native culture, history, and politics. I received a master’s degree in rural development from UAF. Much of my degree focused on how to garner community support and develop sustainable organizations and programs. Over the years I have found that, like a foundation to a house, my education has been the bricks that I have built my career on.” However, luck, opportunity, and influence also played a part. “Some of the best moves in my career were not the result of a well-laid plan but rather responding to an unanticipated opportunity. When opportunity knocks, it’s important to answer the door.”

Tiffany Tutiakoff Tiffany Tutiakoff, president of Northwest Strategies (NWS), had a different www.akbizmag.com

Tiffany Tutiakoff, President Northwest Strategies utiakoff started as an intern at Northwest Strategies and within eight years has grown to become the company president. Before joining Northwest Strategies, Tutiakoff worked as a freelance writer, a community relations coordinator for CIRI, and an assistant convention planner for Alaska Federation of Natives. She received her Bachelor of Arts in Journalism and Public Communications from University of Alaska Anchorage with a minor in Alaska Native Studies and also studied marketing and design at Art Institute of Seattle. Tutiakoff has lived and worked all over Alaska, from the North Slope to Adak Island. Tutiakoff’s Athabascan and Yup’ik heritage, paired with her personal and professional involvement with the Alaska Native community, has provided her with a unique statewide perspective on life in Alaska. Her valuable insight and understanding of Alaska’s indigenous people is imperative to leading an Alaska Native-owned company.

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Maude Blair Vice President Alaska Federation of Natives aude Blair grew up in Kiana in the Arctic Northwest Borough. She received both her Bachelor of Arts in English and her Bachelor of Arts in Broadcast Journalism from University of Alaska Fairbanks, and her Juris Doctor and Indian Law certiﬁ cate at Arizona State University. She is currently a board member for Anchorage Neighborhood Health Center, Alaska Native Heritage Center, and Life Center Northwest, an organization dedicated to saving lives through organ and tissue donation. She was formerly an attorney for NANA, a Kellogg grant coordinator for Native American Rights Fund, a communications technician for NANA, and a morning anchor and reporter for KTVF in Fairbanks.

Shawna Hegna Vice President of Shareholder Services Afognak Native Corporation egna is Alutiiq from the Native village of Port Lions on Kodiak Island. She is a shareholder of Afognak Native Corporation and Koniag, Inc. and a tribal member of Native Village of Port Lions and Native Village of Afognak. Shauna works as the vice president of shareholder services for Afognak Native Corporation. Through her position, Shauna oversees the operation of Afognak’s Shareholder training and development, communication’s and records, and scholarship programs. Shauna is a 2010 NCAIED Native American 40 Under 40 and a 2007 recipient of Alaska’s Top Forty Under 40. She served as the chair of the National Congress of American Indians Alaska Local Planning Committee, the board president of Alaska Community Share, and a board member of the Koniag Education Foundation. Hegna holds both a bachelor’s degree and master’s degree from the University of Alaska and is a graduate of Harvard Business School’s High Potentials Leadership Program.

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path to her position, trusting that the twists and turns on her road would lead her to something that was right for her, not always certain of what that was. “I first explored various career paths that led me to working for a mixed bag of industries including resource development on the North Slope, environmental services on a repatriation project on Adak Island, and a lot in between,” Tutiakoff continues. “At the time I was unaware of the experience I was amassing—I was more or less just trying to figure out what I liked, what I didn’t, and how it would fit in with my lifestyle, which at the time included a lot of travel. Up until that point I was a seasonal, and primarily contractual, employee without a solid career but monetarily satisfied.” As one often will, Tutiakoff grew weary of following a winding path and decided to set her sights on doing what she was most passionate about: influencing behavior. More than eight years ago, Tutiakoff accepted a position at Northwest Strategies, her first time working at an advertising agency. “At that point I had worked on the client side for a variety of companies including

CIRI and Alaska Federation of Natives, and I had gained professional writing experience working for Alaska newspapers,” Tutiakoff says. “So my career path was strategic in that once I had determined what I wanted to do professionally, I took calculated steps to get there, but it did take some time to arrive at that determination. “Though some might view starting a family as a barrier to career development, the birth of my daughter breathed new life into my purpose and actually spurred me on to finish school and find a long-term position at a company I could really grow with,” Tutiakoff says. It is out of respect for their own family bonds that she and the other leaders at NWS have made family a part of their corporate culture. “Work/life balance is something NWS strives to provide for our employees,” Tutiakoff says. Amongst her influences are former UAA adjunct professor Carole Richards and former CIRI communications specialist Dawn Dinwoodie, who instilled in Tutiakoff the importance of giving back to the community through volunteering. “[Dinwoodie and I] were pregnant at the same time and ended up delivering within

twenty-four hours of each other,” Tutiakoff says. “You can’t buy experience like that.” Tutiakoff’s experiences with families and motherhood are part of the inspiration on behalf of NWS to provide pro bono communication work to a handful of nonprofit organizations, specifically in the categories of women and children in need, whose limited funding is tied up in the much-needed services they provide. This year, NWS donated services to the Clare to Clare Fashion Show, a benefit for Clare House for homeless women and children. Additionally, Tutiakoff teamed up with her friend Trina landlord to curate the Alaska Native portion of the fashion show. “For the first time we opened the Alaska Native portion of the show to non-Native models in an effort to communicate to our non-Native population that it is totally okay to honor our cultures by wearing and buying Alaska art. We wanted to make it more accessible. I’m a strong believer that cultural understanding is strengthened through celebration and sharing.” Another social justice issue dear to Tutiakoff’s heart is promoting understanding of racial and cultural diversi-

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ty. She has recently been collaborating with Vince Penman on a coffee table book that profiles ine hundred Alaska Natives from every corner of the state. “The intention was to raise awareness of how beautiful and diverse Alaska Natives are and to break stereotypes that we are all the same. The book is five years in the making and is nearly complete.”

Maude Blair Maude Blair, vice president of the Alaska Federation of Natives, is quick to admit that her leadership position was the result of various opportunities presenting themselves and her accepting them as they did. “I’ve been blessed with the opportunities I’ve had in my life and this is one of the great ones,” she says. Education, in and of itself, was important to Blair from an early age. “I grew up in the village, so I participated in all the extracurricular activities I could to keep busy. My parents were both teachers, so education has always been important to me.” Blair studied English and broadcast journalism in college in order to pre-

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pare herself to be a news reporter but had always had an interest in law. It was while working as a reporter that Blair realized her potential for making a positive impact on other Alaska Natives. “When I was a reporter in Fairbanks, I had underdressed for a totem pole raising at an elementary school one spring. The event was running late, and I was cold and tired from getting up early to do the morning news. A little Native girl walked up to me and said, ‘You’re Maude Blair.’ I said, ‘yeah.’ She said, ‘My mom says I can be just like you when I grow up.’ I forgot about being cold and tired, and sat down and talked to her for a while.” And it’s not just the children who have noticed Blair’s accomplishments and contributions to the community. “I’ve also been touched by the feedback I’ve gotten from elders who are happy that I’ve been able to help communities because of the education I’ve received,” she says. Also, while working as a reporter, Blair kept a close eye on Alaska v. Native Village of Venetie Tribal Government and was impressed with the work of Heather Kendall-Miller, an attorney of Athabascan descent who represented

the village of Venetie, the respondent, before the Supreme Court. “I was really impressed that a Native woman from a village could do that, and it was one of the events that inspired me to go to law school,” Blair says. In order to make valid and valuable contributions to the community and culture, Blair’s advice for other Alaska Native people is to “dream big,” and part of this is to make themselves “big” by extending their reach to where it is needed and appreciated, and collaborating with other like-minded people with the same goals. “Be persistent about reaching your goals, and be involved with your community,” she advises. “Building a network of friends and colleagues to share ideas with is invaluable.”  Mari Gallion is Associate Editor at Alaska Business Monthly.

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Alaska Native Corporations

Top of the World

Photo courtesy of ASRC

The Khumbu Icefall, as seen from Everest Base Camp (17,600’).

Mount Everest climb raises money for the Barrow Boys & Girls Club By Ty Hardt

’m lying in a wind-battered tent at 26,000 feet, taking a slow drain from an oxygen bottle—hoping a fresh supply of Os will be enough to breathe some life back to my tired legs, back, and shoulders. For the past five and a half hours we’ve been on the move—climbing and scratching our way up the Lhotse Face, across the Yellow Band, and over the Geneva Spur to a football field sized notch under the mountain’s final pyramid. While the body is resting, my mind continues to race; I know this break is short lived. In a few short hours I’ll be charging back into the tempest to attempt a goal years in the making: to reach the summit of the highest mountain in the world.

Not Taken Lightly The idea of climbing Mount Everest had been slowly percolating—the topic was 122

raised, if only briefly, during expeditions to Denali and Aconcagua in 2007 and 2009. Interest, and the inevitable self doubt, came to a full boil in the fall of 2012 after being invited by a relative whose Everest plans were already in the works. At forty-six, would I have what it takes to attempt the granddaddy of them all? Could I possibly step away from my family for two full months? Would I still have a job when I got back? Faced with now or never, I kept the door to this opportunity cracked open while I explored my options. First in mind would be to use the expedition as a way to raise funds for a local nonprofit, preferably one serving Alaska’s North Slope—the region represented by Arctic Slope Regional Corporation, or ASRC, where I serve as communications director. After a short

Alaska Business Monthly | September 2013

search, I found the perfect match in the Alaska Boys & Girls Clubs; after all, my son and daughter had been club kids, my wife handled government relations for them on the corporate side, and as importantly, there was an active club in Barrow.

A Club in Need The Barrow Boys & Girls Club, tucked inside Ipalook Elementary School, has more than 130 members and can be especially busy in the summer months. Clubhouse manager Selina Booth knows the facility has made a difference in the community, but believes more could be done. “Those after school programs aren’t funded like they used to be,” says Selina while taking a break from her other duties as division manager for the Barrow www.akbizmag.com

Bustling Kathmandu From the south side, the journey to the highest point on earth begins in the bustling city of Kathmandu, the capital of Nepal, and with connecting communities included, home to more than two and a half million people. After an overnight stay—long enough to trade US cash for rupees and pick up a cheap mobile phone—the team was delivered to the Tenzing-Hillary Airport in Lukla aboard an aging De Havilland Twin Otter. At 9,300 feet, this short, steep landing strip marks the introduction to the Khumbu region and the trek into Everest base camp. Here, the team www.akbizmag.com

Photo courtesy of ASRC

Police Department. “There just are not a lot of opportunities for kids, so they get restless and bored and then they look for things to do and sometimes they exhaust their resources and then they start getting in trouble. The club is not just a rec program. We value the Iñupiat values and we teach kids cooperation and team building and we just do a number of things— arts and crafts and a number of activities that encourage kids to work together and cooperative team-building. Kids are having fun and they’re learning without realizing that they’re learning.” After visiting the facility during Kivgiq in mid-February and hearing about the need firsthand from its clubhouse manager, I knew I had made the right choice. With ASRC in my corner and additional sponsors lining up, final commitments were made. The weeks that followed passed in a blur, the expedition—accurately called Going to Extremes—eventually dominating every thought and every free moment. There would be gear to buy, flights to coordinate, and websites to manage. Early morning runs and training hikes. Doctor checkups. Media interviews. Talks to schools and kids. In a blink, the month of March had come to an end—if there was any more planning and packing to do it would simply be too late. And just like that—ready or not—with a series of duffel bags in tow I was being shuttled to the Ted Stevens Anchorage International Airport to begin what promised to be the adventure of a lifetime. After an emotional goodbye to Noelle and the kids, I was on my way.

The Barrow Boys & Girls Club is located inside the Ipalook Elementary School.

would leave motorized transportation behind—from this point, whatever you needed, whether it was gas for your stove or sugar for your tea, it’d have to be carried in on either two or four legs. It didn’t take long to discover that Everest doesn’t give up ground or elevation easily. The well established base camp trail, snaking up the Chatra Gorge, took us on an up and down chase of the Dudh Koshi River—topping out at Namche Bazaar, a scenic Khumbu metropolis cut into the steep mountainside at more than 11,000 feet. Lined with mountaineering shops, restaurants, and even a pharmacy, Namche Bazaar would be an extended stop while we acclimatized and picked up a handful of souvenirs. This time would also be spent shivering in my down sleeping bag while recovering from a GI bug, an all-too-common affliction along the base camp trail for trekkers and climbers alike. By the time the team had arrived at Everest base camp two weeks after leaving Lukla, we had climbed the nearby 20,000 foot Lobuche Peak, been blessed by eighty-two-year old Lama Geshe in a Pangboche monastery, and had grown quite accustomed to Sherpa tea, the trailside coffee substitute that accompanied nearly every meal. Now at our new home at 17,600 feet, a new set of challenges came into focus. Straight ahead was the Khumbu Icefall and above that the heavily crevassed Western Cwm and steep Lhotse Face. Finally, the real

climbing was about to begin. A trip through the Khumbu Icefall has been compared to the climbing equivalent of Russian roulette, and it may not be an exaggeration. Rising 2,000 feet, the jumbled snow and ice blocks (some the size of apartment buildings) are constantly on the move—threatening to give in to gravity and unexpectedly topple. From high above, massive seracs along the western shoulder are also looming—sections that calve off have been known to send a deadly blast of avalanche debris across the entire route. By the time we would leave Everest, the team would scurry through the Icefall and its dozens of ladder crossings more than six times. For weeks, we crept higher and higher up the mountain to acclimatize, coming down to base camp after each rotation to rest and recover. Eventually collecting enough red blood cells to spend time at Camp III (24,000 feet) on the frozen Lhotse Face, this would be our final round trip before the anticipated summit bid. Craning to investigate the Yellow Band, the distinctive sedimentary sandstone guarding the path to the South Col, any sense of overconfidence melted away. The route was already arduous, and from what it looked like, was about to get even more demanding. Any questions about the rock and ice above Camp III were answered less than two weeks later, the team kicking up the Lhotse Face for what we hoped would be the last time. On this run,

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Ty meets a new friend in the community of Tengboche (12,600’), during the trek to Everest Base Camp.

y Hardt reached the 29,035 foot summit of Mount Everest in the early morning hours of May 20, 2013, with the Going to Extremes expedition raising nearly $30,000 for the Barrow Boys & Girls Club. Nearly 19,000 Alaskan youth a year in more than thirty communities statewide are served by Boys & Girls Clubs. For more information or to donate, visit the expedition’s website at g2extremes.com.

Photo courtesy of ASRC

however, we’d spend the night on a trickle of bottled oxygen—a somewhat awkward but welcome respite from the thinner air. At first light we were back at it, the teeth of our ascenders biting into the fixed lines that traverse the wall of ice. Hour after hour would tick by, the progress slow but continuous. At around noon I shed my crampons for the final walk to the South Col, was welcomed with a firm handshake, and crawled into a nylon dome to force down calories and regain some wellneeded energy.

Go Time The sound of the tent being unzipped startled me to attention. “You packing?” I looked up to see climbing Sherpa Lakpa Bhote crouching inside the vestibule. A half-hour early, Lakpa was already dressed in his down suit, climbing boots, and pack—and apparently in no mood to wait. “Yes, packing,” I said from under my oxygen mask. “Just give me ten more minutes.” Shortly after seven, after rigging my pack with a new oxygen bottle and stuffing in summit banners, heavyweight mittens, a camera, and water—I wished my tentmate, brother-in-law Dave Mauro, luck and crawled back out into the wind. The summit was up there, somewhere, and we intended to find it. The last of the daylight had faded by the time Lakpa and I donned the crampons and began stomping up the Triangular Face. By headlamp we passed a few climbers and settled into an uneasy rhythm—step up, take two or three 124

breaths. Repeat. Stopping at the Balcony (27,600 feet) long enough to switch oxygen bottles and grab a candy bar, we got back into line and began the push to the South Summit nearly 1,000 feet higher. As expected, it was going to be a long night. Reaching the small platform of the South Summit requires more maneuvering through rock, its reward an unforgettable panorama of the surrounding Himalaya stretched out in all directions. As I start skirting across the knifeedged Cornice Traverse, the most exposed and intimidating section of the entire route, the sun is just beginning to make an appearance—the first rays outlining the curvature of the earth in a wafer-thin line of brilliant red. Reluctantly, I don’t stop to capture the scene, but I know it’s made a long-lasting impression. Somehow I’ve climbed to an elevation reserved for passenger jets, and it’s a long way down. The summit may be in sight, but it’s well-protected by a 40-foot rock wall known as the Hillary Step. Though I’ve known about the obstacle for months, solving this high-altitude riddle proves to be a surprising challenge, the path seemingly clear of adequate hand or footholds. On the second or third try I clumsily clear the Step, pick my way through a section of loose rock, and aim for a pile of prayer flags dancing in the breeze. The uphill battle is now in its final stage and with each step the summit and its gathering crowd of other climbers becomes more in focus. The

Alaska Business Monthly | September 2013

Going to Extremes Sponsors (as of mid-July) Corporate ■ Arctic Slope Regional Corporation ■ ASRC Federal Holding Company ■ Alaska Communications ■ Aleut Corporation ■ BP Alaska ■ ConocoPhillips Alaska ■ Bradley Reid + Associates ■ Sugarsled Creative ■ North Slope Borough Mayor’s Ofﬁce ■ KPMG ■ Ice Diva Designs ■ Midnight Sun Brewing Personal ■ Marlene and Harold Poulson ■ Alana Humphrey ■ Eddie Ahyakak ■ Denali Kemppel ■ Tara Sweeney ■ Shelley Cordova ■ Mario Gamboa ■ Ken Asbury ■ Jack and Jan Stillwell ■ Chris Arend time passes slowly as I think of family, friends, and sponsors who were rooting for this moment—until finally the upward steps in the snow peter out. Turning around, I give a high five to Lakpa, shed my pack and take a seat on the roof of the world.  Ty Hardt is the Communications Director at ASRC. www.akbizmag.com

Aleut Corporation

PO Box 649 Glennallen, AK 99588 Phone: 907-822-3476 Fax: 907-822-3495 ahtna-inc.com ituimalealiifano@ ahtna.net Michelle Anderson Pres.

Alaska Employees: 276 Worldwide Employees: 1,705 Shareholders: 1,769 Acres: 1.55 million acres Services: Construction & remediation; facilities management & support services; food service contractors; forestry & gravel sales; government contracting; janitorial, healthcare & medical records services; oil & gas pipeline services. 2012 Gross Revenue: $190,000,000 2011 Gross Revenue: $200,000,000 Revenue Sources: Not disclosed. SUBSIDIARIES: ■ Ahtna Engineering Services LLC ■ Ahtna Development Corp. ■ Ahtna Facility Services, Inc. ■ Ahtna Enterprises Corp. ■ Ahtna Contractors LLC ■ Koht’aene Enterprises Co. LLC ■ Ahtna Support & Training Services LLC ■ Ahtna Technical Services, Inc. ■ Ahtna Government Services Corp. ■ Ahtna Construction & Primary Product ■ Ahtna Design Build, Inc. ■ Ahtna Professional Services, Inc. ■ Ahtna Environmental, Inc. ■ Ahtna Technologies, Inc. ■ Ahtna Logistics, Inc.

aleutcorp.com info@aleutcorp.com

David Gillespie CEO

Alaska Employees: 157 Worldwide Employees: 518 Shareholders: 3,794 Acres: 70,789 surface lands; 1.572 million acres of subsurface estate Services: Commercial and residential real estate; government contracting; fuel & port services; gravel operations; water utilities; oil well testing instrumentation & testing; water testing; mechanical contracting; oil & fuel storage. 2012 Gross Revenue: $98,098,953 2011 Gross Revenue: $148,419,945 Revenue Sources: Operations and Maintenance Contracts, $75,100,828; Fuel Sales, $12,787,044; Rental Properties, $5,098,634; Natural Resource, $6,128,054; Investment income, $1,180,100; Other, $440,056. SUBSIDIARIES: ■ Aleut Enterprises LLC, Anchorage,Alaska ■ Aleut Management Services, Colorado Springs, Colorado ■ Aleut Real Estate LLC, Anchorage, Alaska ■ Alaska Instrument LLC, Anchorage, Alaska ■ C&H Testing LLC Bakersﬁeld, California ■ Patrick Mechanical ■ Analytica Group

Aleut Corp.

www.akbizmag.com

Arctic Slope Regional Corporation

4000 Old Seward Hwy., Suite 300 Anchorage, AK 99503 Phone: 907-561-4300 Fax: 907-563-4328

PO Box 129 Barrow, AK 99723 Phone: 907-852-8633 Fax: 907-852-5733 asrc.com

Rex A. Rock Sr. Pres./CEO

Alaska Employees: 4,525 Worldwide Employees: 10,782 Shareholders: 11,290 Acres: Approximately 5 million acres Services: Energy support services; petroleum reﬁning and marketing; engineering; construction; government services; resource development; commercial lending; tourism; communications; various partnerships; joint ventures; and more. 2012 Gross Revenue: $2,628,929,000 2011 Gross Revenue: $2,549,993,000 Revenue Sources: Petroleum Reﬁning and Marketing 39%; Government Services 27%; Energy Support Services 27%; Construction 5%; Other 2% SUBSIDIARIES: ■ ASRC Energy Services, Inc. ■ ASRC Federal Holding Company, LLC ■ ASRC Construction Holding Company ■ SKW/Eskimos, Inc. ■ Tundra Tours, Inc. ■ Petro Star, Inc. ■ Alaska Growth Capital

Arctic Slope Regional Corp.

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2013 Alaska Native Regional Corporations Directory

Ahtna, Inc.

2013 Alaska Native Regional Corporations Directory

Bering Straits Native Corp.

Bering Straits Native Corporation 4600 Debarr Rd., Suite 200 Anchorage, AK 99508 Phone: 907-563-3788 Fax: 907-563-2742

beringstraits.com media@beringstraits.com

Calista Corporation

111 W. 16th Ave., Suite 400 Anchorage, AK 99501 Phone: 907-278-3602 Fax: 907-276-3924 Gail R. Schubert Pres./CEO

Alaska Employees: 551 Worldwide Employees: 1,095 Shareholders: 7,000 Acres: 2.1 million Services: Gov. contracts construction & renovation; property management & consulting; IT; base operations support; logistics; airﬁeld & aircraft services; administrative services; electrical construction; engineering; project mgmt. 2012 Gross Revenue: $213,000,000 2011 Gross Revenue: $206,000,000 Revenue Sources: General Construction; Investment Income; Aerospace Support Services; Information; Technology/Communications; Property Management and Leasing; Facilities Maintenance; Administrative Support ; Supply and Logistics Support; Textile Fabrication; Security; Mining Support Services

SUBSIDIARIES: ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■

Bristol Bay Native Corporation

Inuit Services, Inc. Bering Straits Aerospace Services LLC Bering Straits Logistics Services LLC Eagle Electric, Inc. Bering Straits Information Technology LLC Bering Straits Technical Services LLC Bering Straits Aki LLC Eagle Eye Electric LLC Ayak LLC Global Support Services LLC Global Management Services LLC Iyabak Construction LLC Global Asset Technologies LLC Global Management Services LLC Global Precision Systems LLC Bering Straits Development Co. Global Technical Services LLC Golden Glacier, Inc. 4600 Debarr LLC

Bering Straits Native Corp.

bbnc.net Jason Metrokin Pres./CEO facebook.com/pages/ Bristol-Bay-Native-Corporation

Alaska Employees: 818 Worldwide Employees: 3,688 Shareholders: 9,300 Acres: 3 million Services: Diversified holding company; construction; government services; oilfield and industrial services; petroleum distribution; and tourism. 2012 Gross Revenue: $1,961,780,000 2011 Gross Revenue: $1,965,507,000 Revenue Sources: Petroleum Distribution; Construction Services; Government Services; Oilfield and Industrial Services; Tourism; Portfolio of Public and Private Passive Investments; Natural Resource Management

SUBSIDIARIES: ■ Badger Technical Services ■ Bristol Bay Corporate Services ■ Bristol Construction Services ■ Bristol Design Build Services ■ Bristol Engineering Services Corporation ■ Bristol Environmental Remediation Services ■ Bristol Fuel Systems ■ Bristol General Contractors ■ Bristol Env. Remediation Services LLC ■ Bristol Munitions Services ■ Business Resource Solutions ■ CCI Group ■ CCI, Inc. ■ CCI Solutions ■ Eagle Applied Sciences ■ Glacier Technical Solutions ■ Glacier Technologies ■ MedPro Technologies ■ KAM Resources Group ■ PetroCard, Inc. ■ SES Construction and Fuel Services

■ SpecPro Environmental Services ■ SpecPro, Inc. ■ SpecPro Technical Services ■ STS Systems Integration ■ TekPro Services ■ Vista International Operations ■ Vista Technical Services ■ Aerostar SES LLC ■ Bristol Earth Sciences, LLC ■ CCI Energy and Construction Services, LLC ■ Eagle Medical Services, LLC ■ Kakivik Asset Management, LLC ■ Bristol Resources ■ SES Design/Build ■ Bristol Bay Resource Solutions ■ Mission Lodge ■ CCI Industrial Services, LLC ■ SES Installation Support, LLC

301 Calista Ct., Suite A Anchorage, AK 99518-3028 Phone: 907-279-5516 Fax: 907-272-5060 calista@calistacorp.com calistacorp.com

Andrew Guy

Alaska Employees: Pres./CEO 272 Worldwide Employees: 1,648 Shareholders: 13,000 Acres: 6,500,000 Services: Defense contracting; full ITtelecom technical services; remote/camp services; environmental remediation-consulting; construction; advertising/marketing; heavy equipment; drilling services; rock quarry material; tug-barge. 2012 Gross Revenue: $404,231,000 2011 Gross Revenue: $300,498,000 Revenue Sources: Contracting and Professional Services; Construction Services; Environmental Services; Marine Services; Rental and Property Management; Marketing/ PR Agency; Camp Services and Catering; Communications; Calista Region Resources; Other Region Resources

SUBSIDIARIES: ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■

Ookichista Drilling Services, Inc Yulista Aviation, Inc. Yulista Management Services, Inc. Y-Tech Services, Inc. Chiulista Services, Inc. Brice Incorporated Tunista, Inc. Tunista Paciﬁc Rim LLC Tunista Construction, LLC Tunista Services, LLC Yukon Equipment, Inc. Futaris (Fomerly Alaska Telecom, Inc.) Solstice Advertising Sequestered Solutions Brice Construction Brice Marine Brice Equipment Brice Environmental Calista Heritage Foundation Calista Real Estate

Calista Corp. Corp.

126

Alaska Business Monthly | September 2013

www.akbizmag.com

In the Ahtna Athabascan language,

Netiye’ means

“Our Strength”

As the holding company of Ahtna, Incorporated, an Alaska Native Regional Corporation with more than 1,700 shareholders, Ahtna Netiye’, Inc. is deeply committed to ensuring the prosperity of the Ahtna people by safely providing the highest quality goods and services to our customers in a manner that reflects our corporate values and maintains our unique cultural identity.

Our Values Unite Us; Our Customers Sustain Us; Our Companies are Prosperous.

Netiye’, Inc. NEW LOCATION 110 W 38th Street, Suite 100B | Anchorage, AK 99503 PH: (907) 868-8250 | FAX: (907) 868-8285 Learn more about Ahtna at www.ahtna-inc.com

Ahtna

www.akbizmag.com

September 2013 | Alaska Business Monthly

127

2013 Alaska Native Regional Corporations Directory

Chugach Alaska Corporation 3800 Centerpoint Dr., Suite 700 Anchorage, AK 99503-4396 Phone: 907-563-8866 Fax: 907-563-8402

Cook Inlet Region Inc.

Gabriel Kompkoff CEO

chugach-ak.com communications@chugach-ak.com

Alaska Employees: 586 Worldwide Employees: 4,822 Shareholders: 2,545 Acres: 10 million acres in Southcentral Alaska. Chugach is entitled to 928,000 acres, of which 378,000 acres are full fee entitlement, and 550,000 acres of subsurface estate. Services: Wide-ranging facility services for federal and commercial clients, including base operations support; construction; facility management; and information technology management. 2012 Gross Revenue: $709,000,000 2011 Gross Revenue: $766,000,000 Revenue Sources: Not disclosed. SUBSIDIARIES: ■ Chugach Alaska Services, Inc. ■ Chugach Federal Solutions, Inc. ■ Chugach Government Services, Inc. ■ Chugach Industries, Inc. ■ Chugach Information Technology, Inc. ■ Chugach McKinley, Inc. ■ Chugach Management Services, Inc. ■ Chugach Support Services, Inc. ■ Chugach World Services, Inc. ■ Defense Base Services, Inc. ■ Falcon International, LLC ■ Wolf Creek Federal Services, Inc. ■ Chugach Education Services, Inc. ■ Heide & Cook, LLC ■ Chugach Systems Integration, LLC

Doyon, Limited

PO Box 93330 Anchorage, AK 99509-3330 Phone: 907-274-8638 Fax: 907-263-5183 ciri.com info@ciri.com

Sophie Minich Pres./CEO

Alaska Employees: 1,189 Worldwide Employees: 1,747 Shareholders: 8,161 Acres: 600,000 surface; 1.3 million acres of subsurface Services: Traditional & alternative energy & resource dev.; oilﬁeld & construction svcs; environmental svcs; real estate investment & mgmt; tourism & hospitality; telecomm; aerospace defense; investments. 2012 Gross Revenue: $237,849,000 2011 Gross Revenue: $200,800,000 Revenue Sources: Traditional and energy and resource development; Oilﬁeld and construction services; Environmental services; Real estate investment and management; Tourism and hospitality; Telecommunications; Aerospace defense; Private equity, venture capital, and marketable security investments

SUBSIDIARIES: ■ Alaska Interstate Construction LLC ■ ANC Research & Development LLC (ANC R&D) ■ CIRI Alaska Tourism Corp. (CATC) ■ CIRI Land Development Co. (CLDC) ■ North Wind Group ■ Fire Island Wind LLC ■ Stone Horn Ridge Investors LLC ■ Cruz Energy Services LLC ■ Cruz Marine LLC ■ Weldin Construction LLC ■ PTP Management, Inc. ■ Silver Mountain Construction LLC

1 Doyon Pl., Suite 300 Fairbanks, AK 99701-2941 Phone: 907-459-2000 Fax: 907-459-2060 doyon.com info@doyon.com

Aaron Schutt Pres./CEO

Alaska Employees: 1,331 Worldwide Employees: 2,498 Shareholders: 18,700 Acres: 12.5 million Services: Oilﬁeld services; drilling & pipeline infrastructure construction; government services; security; utility management; natural resource development; facility & food services; remote site support; engineering; construction. 2012 Gross Revenue: $170,265,198 2011 Gross Revenue: $468,400,000 Revenue Sources: Oil Field Services; Security; Construction; Engineering; Utility services; Tourism SUBSIDIARIES: ■ Doyon Transitional, Inc. ■ Doyon Oil Field Services, Inc. ■ Doyon Government Contracting, Inc. ■ Doyon Natural Resources Development Corporation

Doyon Ltd. Chugach Alaska

Region Inc.

128

Alaska Business Monthly | September 2013

www.akbizmag.com

194 Alimaq Dr. Kodiak, AK 99615 Phone: 907-486-2530 Fax: 907-486-3325

Sealaska

koniag.com facebook.com/KoniagInc Tom Panamaroff

Alaska Employees: 84 Interim Pres. Worldwide Employees: 647 Shareholders: 3,879 Acres: 105,000 acres surface, 900,000 acres subsurface Services: Koniag’s principal lines of business include commercial real estate investments; ANCSA natural resource management; and investments in various operating companies. 2012 Gross Revenue: $126,859,000 2011 Gross Revenue: $128,228,000 Revenue Sources: FISCAL YEAR 2012 (Year ended March 31, 2012) gross revenue sources and amounts - 2011 Gross Revenues shown above are from FY2012 ﬁnancials (comparative): Contract and sales revenue, $117,604,000; Lease income, $1,147,000; Natural resources revenue, $6,770,000 Equity in earnings of afﬁliates, $574,000; Investment Income, $350,000; Loss on disposal of assets ($69,000); Interest income, $95,000; Other, $388,000

SUBSIDIARIES: ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■

Angeles Composite Technologies, Inc Angayak Construction Enterprises, Inc. Clarus Technologies, LLC Digitized Schematic Solutions, LLC Frontier Systems Integrator, LLC Koniag Development Corporation Koniag Services, Inc. Professional Computing Resources, Inc. XMCO, Inc. Dowland-Bach Corporation PacArctic Logistics, LLC Koniag Information Security Services, LLC Granite Cove Quarry, LLC 2320 Post Road, LLC Koniag Technology Solutions, Inc. Nunat Holdings, LLC Anderson Construction Company, LLC Near Island Building, LLC Karluk Wilderness Adventures, Inc. dba Kodiak Brown Bear Center and dba Karluk River Cabins

One Sealaska Plaza, Suite 400 Juneau, AK 99801-1276 Phone: 907-586-1512 Fax: 907-463-3897

NANA Regional Corporation Inc. PO Box 49 Kotzebue, AK 99503 Phone: 907-442-3301 Fax: 907- 442-4161 nana.com/regional news@nana.com

sealaska.com webmaster@ sealaska.com Marie N. Greene Pres./CEO

Alaska Employees: 5,300 Worldwide Employees: 11,576 Shareholders: 13,377 Acres: 2.2 million Services: Resource development; land management; engineering and construction; information technology and telecommunications; facilities management and logistics; real estate and hotel development. 2012 Gross Revenue: $1,800,000,000 2011 Gross Revenue: $1,500,000,000 Revenue Sources: Not disclosed. SUBSIDIARY: ■ NANA Development Corporation

Chris McNeil Pres./CEO

Alaska Employees: 108 Worldwide Employees: 2,033 Shareholders: 21,300 Acres: 292,000 with 70,000 pending Services: Sealaska’s businesses are divided into three tiers: natural resources, construction & services. Through our wholly and majorityowned subsidiaries, Sealaska operates in a range of industries and offers a variety of products. 2012 Gross Revenue: $311,620,000 2011 Gross Revenue: $259,487,000 Revenue Sources: Forest products; Construction aggregates; General construction and design build; Mariculture; Seafood processing; Renewable energy; Information technology services; Environmental remediation and services; Security services SUBSIDIARIES: ■ Sealaska Timber Corporation ■ Synergy Systems ■ Alaska Coastal Aggregates ■ Sealaska Environmental Services ■ Managed Business Solutions ■ Sealaska Constructors ■ Security Alliance ■ Haa Aani, LLC

NANA Regional Corp.

Sealaska Corp.

www.akbizmag.com

September 2013 | Alaska Business Monthly

129

2013 Alaska Native Regional Corporations Directory

Koniag Inc.

2013 Alaska Native Regional & Village Corporatyion Directory

The 13th Regional Corp. Michael Rawley, President 611 12th Ave. S., Suite 300 Seattle, WA 98044

EDITOR’S NOTE ■ Information obtained from the State of Alaska; Department of Commerce, Community, and Economic Development; Division of Corporations, Business and Professional Licensing.

The 13th Regional Corp.

Village Corporations Community Afognak Akhiok Akiachak Akiak Akutan Alakanuk Alatna Aleknagik Allakaket Anaktuvuk Pass Andreafsky Angoon Aniak Anvik Arctic Village Atka Atmautluak Atqasuk Ayakulik Barrow Beaver Belkofski Bethel Bill Moore’s Slough Birch Creek Brevig Mission Chalkyitsik Chefornak Chenega Bay Chevak Chickaloon Chignik Chignik Lagoon Chignik Lake Chitina Chuathbaluk Chuloonawick Circle Clark’s Point 130

Village Corporation Afognak Native Corporation Akhiok-Kaguyak, Incorporated Akiachak, Limited Kokarmuit Corporation The Akutan Corporation Alakanuk Native Corporation K’oyitl’ots’ina, Limited Aleknagik Natives Limited K’oyitl’ots’ina, Limited Nunamiut Corporation, Incorporated Nerklikmute Native Corporation Kootznoowoo, Incorporated The Kuskokwim Corporation Deloyges (Deg Hit’an) Corporation Neets’ai Corporation Atxam Corporation Atmautluak Limited Atqasuk Corporation Ayakulik, Incorporated Ukpeagvik Inupiat Corporation Beaver Kwit’chin Corporation Belkofski Corporation Bethel Native Corporation Kongnikilnomuit Yuita Corporation Tihteet’aii, Incorporated Brevig Mission Native Corporation Chalkyitsik Native Corporation Chefarnrmute, Incorporated The Chenega Corporation Chevak Company Chickaloon-Moose Creek Native Association, Incorporated Far West, Incorporated Chignik Lagoon Native Corporation Chignik River Limited Chitina Native Corporation The Kuskokwim Corporation Chuloonawick Corporation Danzhit Hanlaii Corporation Saguyak Incorporated

Alaska Business Monthly | September 2013

Address 215 Mission Road, Ste. 212, Kodiak 99615 1400 W. Benson Blvd. #425, Anchorage 99503 PO Box 51010, Akiachak 99551-0010 PO Box 147, Akiak 99552 PO Box 8, Akutan 99553 PO Box 89, Alakanuk 99554 1603 College Road, Fairbanks 99709 PO Box 1630, Dillingham 99576-1630 1603 College Road, Fairbanks 99709 PO Box 21009, Anaktuvuk Pass 99721 PO Box 87, Saint Mary’s 99658 8585 Old Dairy Road, Ste. 104, Juneau 99801 4300 B St., Ste. 207, Anchorage 99503 Anvik 99558 Arctic Village 99722 PO Box 47001, Atka 99547 PO Box 6548, Atmautluak 99559 PO Box 1169, Barrow 99723 3741 Richmond #5, Anchorage 99508 PO Box 890, Barrow 99723 PO Box 24090, Beaver 99724 PO Box 46, King Cove 99612 PO Box 719, Bethel 99559 PO Box 20308, Kotlik 99620 PO Box 71372, Fairbanks 99701 PO Box 85024, Brevig Mission 99785 PO Box 53, Chalkyitsik 99788 110 Airport Way, Chefornak 99561 3000 C St, Ste. 301, Anchorage 99503 PO Box 179, Chevak 99563 PO Box 875046, Wasilla 99687

Phone 907-486-6014 907-258-0604 907-825-4328 907-765-7228 907-698-2206 907-238-3117 907-452-8119 907-842-2385 907-452-8119 907-661-3026 907-438-2332 907-790-2992 907-243-2944

3150 C St., Ste. 270, Anchorage 99501 16016 Mammoth Cir, Eagle River 99577-8015 PO Box 48008, Chignik Lake 99548 PO Box 3, Chitina 99566-0031 4300 B St., Ste. 207, Anchorage 99503 2635 Draper Dr, Anchorage 99517 PO Box 71372, Fairbanks 99701 PO Box 4, Clarks Point 99569

907-276-2580 907-840-2225 907-845-2212 907-823-2223 chitinanative.com 907-243-2944 kuskokwim.com 907-949-1234 907-455-8484 907-236-1235

907-839-2237 907-553-5428 907-852-8633 907-279-7911 907-852-4460 907-456-1640 907-497-3122 907-543-2124 907-899-4016 907-455-8484 907-642-4091 907-848-8112 907-867-8115 907-277-5706 907-858-7920 907-373-1145

Website afognak.com

koyitlotsina.com koyitlotsina.com

kootznoowoo.com kuskokwim.com

ukpik.com

bethelnativecorp.org

chefarnrmute.com chenega.com chickaloon.org

www.akbizmag.com

Village Corporation Council Native Corporation Shaan-Seet, Incorporated The Kuskokwim Corporation Choggiung Limited Diomede Native Corporation Dot Lake Native Corporation Hungwitchin Corporation Iqﬁjouaq Company Becharof Corporation Eklutna, Incorporated Choggiung Limited Ekwok Natives Limited Elim Native Corporation Emmonak Corporation Evansville, Incorporated The Eyak Corporation Isanotski Corporation Gwitchyaa Zhee Corporation Gana-A’Yoo, Limited Sivuqaq, Incorporated The Kuskokwim Corporation Golovin Native Corporation Kuitsarak, Incorporated Hee-Yea-Lingde Corporation Nunapiglluraq Corporation Mendas Cha-ag Native Corporation Deloycheet, Incorporated Huna Totem Corporation Sea Lion Corporation K’oyitl’ots’ina, Limited K’oyitl’ots’ina, Limited Haida Corporation Igiugig Native Corporation Iliamna Natives Limited Bay View, Incorporated Akhiok-Kaguyak, Incorporated Kake Tribal Corporation Kaktovik Inupiat Corporation Gana-A’Yoo, Limited Kavilco Incorporated Kasigluk, Incorporated Kenai Natives Association, Incorporated The King Cove Corporation King Island Native Corporation Kugkaktlik, Limited Klawock Heenya Corporation Klukwan, Incorporated Knikatnu, Incorporated Natives of Kodiak, Incorporated Alaska Peninsula Corporation

Koliganek Kongiganak Kotlik Kotzebue Koyuk

Koliganek Natives Limited Qemirtalek Coast Corporation Kotlik Yupik Corporation Kikiktagruk Inupiat Corporation Koyuk Native Corporation

www.akbizmag.com

Address PO Box 1183, Nome 99762 PO Box 690, Craig 99921 4300 B St., Ste. 207, Anchorage 99503 PO Box 330, Dillingham 99576 PO Box 7040, Diomede 99762 3500 Wolf Run, Fairbanks 99709 PO Box 84594, Fairbanks 99708 PO Box 49, Eek 99578 PO Box 220029, Anchorage 99522-0029 16515 Centerﬁeld Dr. #201, Eagle River 99577 PO Box 330, Dillingham 99576 PO Box 1189, Dillingham 99576 PO Box 39010, Elim 99739 PO Box 49, Emmonak 99581 PO Box 60670, Fairbanks 99706 901 LeFevre St., PO Box 340, Cordova 99574-0340 PO Box 9, False Pass 99583 PO Box 329, Fort Yukon 99740 6927 Old Seward Hwy., Ste. 101, Anchorage 99518 PO Box 101, Gambell 99742 4300 B St., Ste. 207, Anchorage 99503 PO Box 62099, Golovin 99762 PO Box 150, Goodnews Bay 99589 PO Box 9, Grayling 99590 PO Box 20187, Kotlik 99620 457 Cindy Drive, Fairbanks 99701 525 W. 3rd Ave., Ste. 310, Anchorage 99501 9301 Glacier Hwy., Ste. 200, Juneau 99801 PO Box 87, Hooper Bay 99604 1603 College Road, Fairbanks 99709 1603 College Road, Fairbanks 99709 PO Box 89, Hydaburg 99922 PO Box 4009, Igiugig 99613-4009 3201 C St., Ste. 406, Anchorage 99606 7926 Old Seward, Ste. A-7, Anchorage 99518 1400 W. Benson Blvd. #425, Anchorage 99503 PO Box 263, Kake 99830 P. O. Box 73, Kaktovik 99747 6927 Old Seward Hwy., Ste. 101, Anchorage 99518 PO Box KXA Kasaan, Ketchikan 99950 PO Box 39, Kasigluk 99609 215 Fidalgo Ave. #101, Kenai 99611-7776 PO Box 38, King Cove 99612 PO Box 992, Nome 99762 PO Box 36, Kipnuk 99614 PO Box 129, Klawock 99925 PO Box 209, Haines 99827 PO Box 872130, Wasilla 99687-2130 215 Mission Rd. #201, Kodiak 99615 2221 E. Northern Lights Blvd., Ste. 119, Anchorage 99508 PO Box 5023, Koliganek 99576 PO Box 5070, Kongiganak 99559 PO Box 20207, Kotlik 99620 PO Box 1050, Kotzebue 99752 PO Box 53050, Koyuk 99752

Phone 907-443-6513 907-826-3251 907-243-2944 907-842-5218 907-686-3221 907-347-1251 907-778-2231 907-536-5211 907-561-4777 907-696-2828 907-842-5218 907-464-3336 907-890-3741 907-949-1129 907-374-7084 907-424-7161 907-548-2217 907-662-2933 907-569-9599

Website

907-243-2944 907-779-3251 907-967-8428 907-453-5133 907-899-4453 907-452-3094 907-375-1900 907-523-3670 907-758-4415 907-452-8119 907-452-8119 907-285-3721 907-533-3211 907-571-1246 907-345-9627 907-258-0604 907-785-3221 907-640-6120 907-569-9599 907-542-2214 907-447-6113 907-283-4851 907-497-2312 907-443-5494 907-896-5414 907-755-2270 907-766-2211 907-376-2845 907-486-3606 907-274-2433

kuskokwim.com

2013 Alaska Native Village Corporatyion Directory

Community Council Craig Crooked Creek Dillingham Diomede Dot Lake Village Eagle Village Eek Egegik Eklutna Ekuk Ekwok Elim Emmonak Evansville Eyak False Pass Fort Yukon Galena Gambell Georgetown Golovin Goodnews Bay Grayling Hamilton Healy Lake Holy Cross Hoonah Hooper Bay Hughes Huslia Hydaburg Igiugig Iliamna Ivanof Bay Kaguyak Kake Kaktovik Kaltag Kasaan Kasigluk Kenai King Cove King Island Kipnuk Klawock Klukwan Knik-Fairview Kodiak Kokhanok

shaanseet.com kuskokwim.com choggiung.com

eklutnainc.com choggiung.com

kazwork.net eyakcorporation.com isanotski.alaska.com ganaayoo.com

deloycheet.com hunatotem.com koyitlotsina.com koyitlotsina.com haidacorp.comindex.htm igiugig.com

ganaayoo.com kavilco.com

kingcovecorporation.com kingislandnative.com klawockheenya.com klukwan.com nativesofkodiak.com alaskapeninsulacorp.com

907-596-3440 907-557-5529 907-899-4014 907-442-3165 kikiktagruk.com 907-963-2424

September 2013 | Alaska Business Monthly

131

2013 Alaska Native Regional & Village Corporatyion Directory

Community Koyukuk Kwethluk Kwigillingok Levelock Lime Village Lower Kalskag Manley Hot Springs Manokotak Marshall Mary’s Igloo McGrath Mekoryuk Minto Mountain Village Naknek Nanwalek Napaimute Napakiak Nelson Lagoon Nenana New Stuyahok Newhalen Newtok Nightmute Nikolai Nikolski Ninilchik Nome Nondalton Northway Village Nuiqsut Nulato Nunam Iqua Nunapitchuk Ohogamiut Old Harbor Oscarville Ouzinkie Paimiut Pauloff Harbor Pedro Bay Perryville Pilot Point Pilot Station Pitkas Point Platinum Point Hope Point Lay Port Alsworth Port Graham Port Heiden Port Lions Portage Creek Quinhagak

132

Village Corporation Gana-A’Yoo, Limited Kwethluk Incorporated Kwik Incorporated Levelock Natives Limited Lime Village Company The Kuskokwim Corporation Bean Ridge Corporation Manokotak Natives Limited Maserculiq, Incorporated Mary’s Igloo Native Corporation MTNT, Limited Nima Corporation Seth-De-Ya-Ah Corporation Azachorok Incorporated Paug-Vik Incorporated, Limited The English Bay Corporation The Kuskokwim Corporation Napakiak Corporation Nelson Lagoon Corporation Toghotthele Corporation Stuyahok Limited Alaska Peninsula Corporation

Address 6927 Old Seward Hwy., Ste. 101, Anchorage 99518 Kwethluk 99621 PO Box 110, Kwigillingok 99622 PO Box 109, Levelock 99625 605 W. Tudor Road, Anchorage 99503 4300 B St., Ste. 207, Anchorage 99503 PO Box 82062, Fairbanks 99708 Manokotak 99628 PO Box 90, Marshall 99585 PO Box 650, Teller 99778 PO Box 309, McGrath 99627 PO Box 52, Mekoryuk 99607 PO Box 56, Minto 99758 PO Box 32213, Mountain Village 99632 PO Box 61, Naknek 99633 1637 Stanton Ave., Anchorage 99508 4300 B St., Ste. 207, Anchorage 99503 PO Box 34030, Napakiak 99634 PO Box 913, Nelson Lagoon 99571 PO Box 249, Nenana 99760 PO Box 1309, Dillingham 99576 2221 E. Northern Lights Blvd., Ste 119, Anchorage 99508 Newtok Native Corporation PO Box 5528, Newtok 99559 Chinuruk Incorporated PO Box 90009, Nightmute 99690 MTNT, Limited PO Box 309, McGrath 99627 Chaluka Corporation PO Box 104, Nikolski 99638 Ninilchik Natives Association, Incorporated PO Box 39130, Ninilchik 99639 Sitnasuak Native Corporation PO Box 905, Nome 99762 Kijik Corporation 1577 C St., Ste. 302, Anchorage 99501 Northway Natives Incorporated PO Box 401, Northway 99764 Kuukpik Corporation 801 B St., Ste. 300, Anchorage 99501 Gana-A’Yoo, Limited 6927 Old Seward Hwy., Ste. 101, Anchorage 99518 Swan Lake Corporation PO Box 25, Nunam Iqua 99666 Nunapitchuk Limited PO Box 129, Nunapitchuk 99641-0129 Ohog Incorporated PO Box 49, Lower Kalskag 99626 Old Harbor Native Corporation PO Box 71, Old Harbor 99643 Oscarville Native Corporation PO Box 6085, Napaskiak 99559 Ouzinkie Native Corporation PO Box 89, Ouzinkie 99644 Paimiut Corporation PO Box 209, Hooper Bay 99604 Sanak Corporation PO Box 194, Sand Point 99661 Pedro Bay Corporation 1500 W. 33rd Ave., Ste. 220, Anchorage 99503 Oceanside Corporation PO Box 84, Perryville 99648 Pilot Point Native Corporation PO Box 487, Pilot Point 99649 Pilot Station, Incorporated PO Box 5059, Pilot Station 99650 Pitka’s Point Native Corporation PO Box 289, St. Mary’s 99658 Arviq Incorporated PO Box 9, Platinum 99651 Tikigaq Corporation 2121 Abbott Road, Anchorage 99507 Cully Corporation Incorporated 5001 Eagle St., Unit B, Anchorage 99503 Tanalian, Incorporated 2425 Merrill Field Dr., Anchorage 99501 The Port Graham Corporation 629 L St., Ste. 205, Anchorage 99501 Alaska Peninsula Corporation 2221 E. Northern Lights Blvd., Ste 119, Anchorage 99508 Afognak Native Corporation 215 Mission Road, Ste. 212, Kodiak 99615 Choggiung Limited PO Box 330, Dillingham 99576 Qanirtuuq, Incorporated PO Box 69, Quinhagak 99655

Alaska Business Monthly | September 2013

Phone Website 907-569-9599 ganaayoo.com 907-588-8112 907-287-3040 907-276-1550 907-243-2944 907-458-2176 907-289-1062 907-679-6512 907-642-2308 907-524-3391 907-827-8636 907-798-7181 907-591-2527 907-246-4277 907-562-4703 907-243-2944 907-589-2227 907-989-2204 907-832-5832 907-693-3122 907-274-2433 907-237-2200 907-647-6813 907-524-3391 907-576-2215 907-567-3866 907-387-1200 907-561-4487 907-778-2298 907-480-6220 907-569-9599 907-498-4227 907-527-5717 907-679-6517 907-286-2286 907-737-7090 907-680-2208 907-527-4915 907-383-6075 907-277-1500 907-797-2300 907-797-2213 907-549-3512 907-438-2953 907-979-8113 907-365-6299 907-569-2705 907-272-3581 907-272-7432 907-274-2433

kuskokwim.com

mtnt.net nimacorporation.com

pvil.com kuskokwim.com

toghotthele.com alaskapeninsulacorp.com

mtnt.net nnai.net snc.org kijikcorp.com

ganaayoo.com

oldharbornativecorp.com ouzinkienativecorporation.com

pedrobaycorp.com

cullycorp.com portgrahamcorp.com alaskapeninsulacorp.com

907-486-6014 afognak.com 907-842-5218 choggiung.com 907-556-8290

www.akbizmag.com

Village Corporation Baan O Yeel Kon Corporation The Kuskokwim Corporation Dineega Corporation Russian Mission Native Corporation St. George Tanaq Corporation St. Mary’s Native Corporation St. Michael Native Corporation Tanadgusix Corporation Salamatof Native Association, Incorporated Shumagin Corporation Savoonga Native Corporation Cape Fox Corporation Askinuk Corporation Seldovia Native Association, Incorporated Zho-Tse, Incorporated Shaktoolik Native Corporation Shishmaref Native Corporation Shee Atika, Incorporated The Kuskokwim Corporation Solomon Native Corporation Alaska Peninsula Corporation

Stebbins Stevens Village Stony River Takotna Tanacross Tanana Tatitlek Telida Teller Tetlin Togiak Toksook Bay Tuluksak Tuntutuliak Tununak Twin Hills Tyonek Uganik Ugashik

Stebbins Native Corporation Dinyea Corporation The Kuskokwim Corporation MTNT, Limited Tanacross Incorporated Tozitna, Limited The Tatitlek Corporation MTNT, Limited Teller Native Corporation Tetlin Native Corporation Togiak Natives Limited Nunakauiak Yupik Corporation Tulkisarmute Incorporated Tuntutuliak Land, Limited Tununrmiut Rinit Corporation Twin Hills Native Corporation Tyonek Native Corporation Uganik Natives, Incorporated Alaska Peninsula Corporation

Umkumiute Unalakleet Unalaska Unga Upper Kalskag Uyak Venetie Wainwright Wales White Mountain Woody Island Yakutat

Chinuruk Incorporated Unalakleet Native Corporation Ounalashka Corporation Unga Corporation The Kuskokwim Corporation Uyak Natives, Incorporated Venetie Indian Corporation Olgoonik Corporation Wales Native Corporation White Mountain Native Corporation Leisnoi, Incorporated Yak-Tat Kwaan Incorporated

Address PO Box 74558, Fairbanks 99707 4300 B St., Ste. 207, Anchorage 99503 Ruby 99768 PO Box 48, Russian Mission 99657 4141 B St., Ste. 301, Anchoragev99503 PO Box 149, Saint Mary’s 99658 PO Box 59049, St. Michael 99659 4300 B St., Ste 209, Anchorage 99503 100 N. Willow St., Kenai 99611 PO Box 189, Sand Point 99661 Savoonga 99769 PO Box 8558, Ketchican 99901 Scammon Bay 99662 PO Drawer L, Seldovia 99663-0250 PO Box 130, Shageluk 99665 PO Box 46, Shaktoolik 99771 P.O Box 72151, Shishmaref 99772 315 Lincoln St. #300, Sitka 99835 4300 B St., Ste. 207, Anchorage 99503 PO Box 243, Nome 99762 2221 E. Northern Lights Blvd., Ste 119, Anchorage 99508 PO Box 71110, Stebbins 99671 PO Box 71372, Fairbanks 99707 4300 B St., Ste. 207, Anchorage 99503 PO Box 309, McGrath 99627 PO Box 76029, Tanacross 99776 PO Box 129, Tanana 99777 561 E 36th Ave, Anchorage 99503 PO Box 309, McGrath 99627 PO Box 649, Teller 99778 PO Box 657, Tok 99780 PO Box 150, Togiak 99678 PO Box 37068, Toksook Bay 99637 PO Box 65, Tuluksak 99679 PO Box 8106, Tuntutuliak 99680 PO Box 89, Tununak 99681 PO Box TWA, Twin Hills 99576 1689 C St., Ste. 219, Anchorage 99501 PO Box 853, Kodiak 99615 2221 E. Northern Lights Blvd., Ste 119, Anchorage 99508 PO Box 90009, Nightmute 99690 PO Box 100, Unalakleet 99684 PO Box 149, Unalaska 99685 PO Box 130, Sand Point 99661 4300 B St., Ste. 207, Anchorage 99503 PO Box 31, Chignik 99564 Venetie 99781 PO Box 29, Wainwright 99782 PO Box 529, Wales 99783 PO Box 81, White Mountain 99784 2000 Dowling Road, Ste. 3, Anchorage 99507 PO Box 416, Yakutat 99689

2013 Alaska Native Village Corporatyion Directory

Community Rampart Red Devil Ruby Russian Mission Saint George Saint Mary’s Saint Michael Saint Paul Salamatof Sand Point Savoonga Saxman Scammon Bay Seldovia Shageluk Shaktoolik Shishmaref Sitka Sleetmute Solomon South Naknek

Phone Website 907-456-6259 907-243-2944 kuskokwim.com 907-584-5885 907-272-9886 stgeorgetanaq.com 907-438-2315 907-923-3143 907-278-2312 907-283-3745 salamatof.com 907-383-3525 shumagin.com 907-225-5163 capefoxcorp.com 907-234-7625 907-473-8262 907-955-3241 907-649-3751 907-747-3534 907-243-2944 907-443-7526 907-274-2433 907-934-3074 907-452-5063 907-243-2944 907-524-3391 907-883-4130 907-366-7255 907-278-4000 907-524-3391 907-642-6132

snai.com

sheeatika.com kuskokwim.com alaskapeninsulacorp.com

kuskokwim.com mtnt.net tanacrossinc.com tatitlek.com mtnt.net

907-493-5520 907-427-7929 907-695-6854 907-256-2315 907-652-6311 907-525-4327 907-272-0707 tyonek.com 907-486-3009 907-274-2433 alaskapeninsulacorp.com 907-647-6813 907-624-3411 907-581-1276 ounalashka.com 907-383-5215 907-243-2944 kuskokwim.com 907-486-4681 907-763-2613 olgoonik.com 907-664-3641 907-622-5003 907-222-6900 leisnoi.com 907-784-3335 yak-tatkwaan.com

Editors Note: Data for the Village Corporations Listings are from the Alaska Department of Commerce, Division of Community and Regional Affairs. Changes and corrections should be emailed to DCRAresearch&analysis@alaska.gov or faxed to 907-269-4539. www.akbizmag.com

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RIGHT MOVES UMIAQ LLC

Laura W. Strand, PE, has joined UMIAQ’s Engineering Department as an Associate Civil Engineer. Strand is a University of Alaska Anchorage graduate and a registered Professional Engineer in Civil Engineering. Michael Wolski, PE, has been named Engineering Manager for UMIAQ’s Engineering Department. Wolski is a University of Alaska graduate with more than twenty years of experience designing, managing, and coordinating civil engineering projects throughout the state of Alaska.

Compiled by Mari Gallion University Alaska Fairbanks Cooperative Extension Service

Kathryn Dodge is the new economic development specialist for the University of Alaska Fairbanks Cooperative Extension Service. Dodge holds a doctorate in human and organizational systems from Fielding Graduate Institute.

Alaska Native Medical Center

USKH Inc.

PDC Inc. Engineers

Hightower

Apodaca

Webb

PDC Inc. Engineers announces that Valerie Webb and Victor Apodaca, PE, have joined the firm working from PDC’s Fairbanks office. Apodaca received his Bachelor of Science in Civil Engineering from the University of Alabama at Birmingham and is a registered Civil Engineer in Alaska as well as three other states. Webb will serve as PDC’s Lead Environmental Analyst. She has more than thirteen years of experience, most recently involving environmental coordination in the gold exploration industry.

Officer. Lundfelt has held a variety of increasingly responsible positions during his fifteen years with Alaska USA and holds a Bachelor of Arts from the University of Alaska Fairbanks. Jerry Reed has been promoted to Chief Lending Officer. Reed has more than twenty-five years of lending experience in commercial, mortgage, and consumer lending and holds a Bachelor of Arts from California State University, Sacramento, and a Master of Business Administration from the University of Maryland.

Paris

The Alaska Native Medical Center has appointed C. David Hightower, MD, as the new Service Chief of Orthopedics and Patti Paris, MD, FACEP, MBA, as new Service Chief of the ANMC Emergency Department. Hightower earned his doctorate degree in 2007 from the University of Minnesota Medical School, where he also completed the Orthopedic Surgery Residency Program. As a longtime member of the ANMC staff, Paris brings compassion, expertise, and leadership to the care team.

Alaska USA

USKH Inc. is pleased to announce that Kevin Ross has joined the multidisciplined firm as a structural Engineer-in-Training. Ross is a 2009 cum laude graduate of Washington State University. Ross

Ukpeaġvik Iñupiat Corporation

Rebecca Brower has been . named UIC Foundation Administrator at Ukpeagvik Iñupiat Corporation. Brower has a great deal of work experience in the fields of human resources and administration along with an extensive list of certifications.

University of Alaska

The University of Alaska has hired Bill Bieber as director of the Mining and Petroleum Training Service. Bieber has a thirty-four-year history in the mining and petroleum industries in Alaska and Montana.

URS Corporation

Fine Point

Azia Weisz has joined the Fine Point team as an Account Manager. Weisz graduated with a double major in Management and Marketing at the University of Alaska Anchorage.

Lundfelt

Weisz

Reed

Alaska USA is pleased to announce that Geoff Lundfelt has been promoted to Chief Operations

Dana Seagars has joined URS as a Senior Marine Mammal Biologist. Seagars has more than thirty-eight years of experience in marine mammal studies and National Environmental Policy Act compliance. Seagars

OH MY! 134

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www.akbizmag.com

RIGHT MOVES Bettisworth North Architects and Planners Inc.

Bettisworth North Architects and Planners Inc. named Leah Boltz Director of Marketing and Business Development for the firm. Boltz has a degree in Journalism and Public Communications, Business and Professional Writing from the University of Boltz Alaska Anchorage.

Compiled by Mari Gallion Guse is known for her skills in overseeing the development of advertising, collateral materials, videos, event planning, and budgets for clients in the health care, oil and gas, and resource industries. Meshke holds two bachelor’s degrees, one in business administration and another in fine arts.

Alaska Railroad Corporation

College and completed additional engineering coursework at the University of Nebraska. Barbara Amy was promoted to Chief Financial Officer. Amy earned a Bachelor of Business Administration from the University of Connecticut and a Master of Business Administration from the University of Chicago. Jon Garner was promoted to Transportation Superintendent. Garner attended the Michigan State University Railway Management Program in East Lansing, Michigan, and the Johnson County Community College Railroad Science Program in Overland Park, Kansas.

TOTE Logistics, Inc.

Wells Fargo Insurance

Todd Allen has been named Employee Benefits Senior Account Executive for Wells Fargo Insurance in Alaska. Allen holds a lifetime Senior Professional in Human Resources certification and he is a Certified Compensation Professional. Allen

O’Leary

Hopp

Leary

Lynden Air Cargo

Lynden Air Cargo has promoted Richard Zerkel to President. Zerkel began his career with Lynden Air Cargo in 1999 as a first officer on the company’s Hercules aircraft. He was promoted to Captain and then Director of Operations in 2008. He most recently was Vice President of Operations.

MSI Communications

Guse

Meshke

MSI Communications has added Amy Guse asAccount Manager and Bryan Meshke as Web Director.

www.akbizmag.com

Lindskoog

Amy

AlaskaRailroadCorporation recently realigned its toplevel management team, which features expanded roles and a few new faces. William G. O’Leary is now the Chief Operating Officer. O’Leary holds a bachelor’s degree in Garner accounting from the University of Alaska Fairbanks. Wendy Lindskoog is now Vice President, Business Management & Corporate Affairs. Lindskoog earned a bachelor’s degree in journalism from the University of Colorado, Boulder. Clark Hopp was named Vice President Engineering. Hopp earned a degree in Construction Engineering Technology from Iowa Western

Hawtrey

Linda Leary has accepted the Vice President, Commercial Development position with TOTE Logistics, Inc. Leary’s new role will be overseeing the Sales and Marketing Department of Carlile, TOTE Logistics, Inc., and Spectrum. Geoffrey Hawtrey has accepted the position of Vice President, Support Services. Hawtrey will be working with the Carlile, TOTE Logistics, Inc., and Spectrum IT Departments to develop and implement strategies, policies, and initiatives needed to support the corporate vision and achieve organizational goals. Jeff Palmer has accepted the Controller position. Palmer will be overseeing the accounting and finance department to streamline processes, develop budgets, reduce expenses, and keep revenue growing.

ASRC Federal

ASRC Federal announces the hire of Bridget Medeiros as ASRC Federal Senior Vice President, Business Development. She holds a bachelor’s degree in communications and a master’s degree in information systems. 

September 2013 | Alaska Business Monthly

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ALASKA THIS MONTH Compiled by Tasha Anderson

dining

Photo by Stephen Nowers

Rise & Shine Bakery

Bakery owners Dan and Alison Arians.

“

e specialize in long-fermented whole grain sourdough breads,” says Alison Arians, co-owner of Rise & Shine Bakery with her husband, Dan. They started the bakery in 2007, attaching a commercial bakery to their home, complete with a “huge, gas-fired, fourdeck hearth oven that bakes one hundred loaves an hour.” Their bakery has no storefront. During the summer (June through September), customers interested in trying their breads can pick up a loaf at the Saturday South Anchorage Farmer’s Market located at the Subway/Cellular One Sports Centre near the corner of Old Seward and O’Malley. “Except the first Saturday of each month,” Arians says, “we take that week to go camping with our daughter.” During the bakery’s “wintertime” schedule, which starts in October, customers order bread online and then pick it up at Sweet Adeline’s Toy Store on Huffman or Side Street Espresso downtown. “Although it’s not a typical model,” Arians says, “it’s working really well the way it is. Not many other bakeries make whole grain sourdough bread ... so it’s a great little niche.” Rise & Shine rotates what breads are offered through a schedule, which can be found on the bakery’s website. The rotation for September includes: Alaskan baked potato, spent grain, toasted seed, fresh rosemary, fruited almond, flax seed, Kalamata olive, toasted walnut, onion rye, and dark chocolate and cherry. For those that develop a taste for a favorite and want it yearround, the changing schedule shouldn’t cause much concern. “Luckily,” Arians says, “because of the long fermentation of the bread, it keeps very well whether out on the counter or in the freezer, so it’s easy to stock up and freeze the bread for later.” riseandshinebread.com

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 www.akbizmag.com

ALASKA THIS MONTH Compiled by Tasha Anderson

trAvel

Oktoberfest

his year Alaska has benefited from several major airlines introducing new flights available from Anchorage, providing easier access to many international destinations. It may just convince a few travelers to turn their eye toward Munich, and what better to experience there than the original Oktoberfest. “Although other festivals try to emulate it, none can compete with the original: More than six million people visit Oktoberfest each year, and millions of liters of tasty Bavarian beer are imbibed—but it still keeps the feeling of ‘Gemütlichkeit,’ that special brand of Bavarian friendliness, laid-back-ness, and tradition,” says Andreas Blüml, editor of Oktoberfest.de. This is the 180th year of the festival, and the essential character of the event remains, as it features “fourteen huge beer tents seating up to ten thousand people, fun rides, traditional parades with thousands of participants, and of course, the special Oktoberfest beer made by six Munich breweries,” Blüml says. A new addition this year, making the giant festival more manageable for attendees, is the new Smart Card; simply scan the QR code from the Smart Card with a smartphone to get useful information. Oktoberfest, at it’s heart, is a celebration. As Blüml says, “Everyone—the young family, the group of teenagers, the Bavarian costume group, or visitors from overseas—can enjoy it in their very own way. Carousels and rides for some, traditional music for the others, and great food and beer for everyone.” Visitors are strongly encouraged to utilize the public transportation network as there is almost no parking nearby. This year’s Oktoberfest is September 21 through October 6. oktoberfest.de

www.akbizmag.com

 September 2013 | Alaska Business Monthly

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ALASKA THIS MONTH Compiled by Tasha Anderson

entertAinment

Photo by Lisa Erickson

Senshi-Con

“Battle” between two cosplay Senshi-Con attendees participating as pieces in the annual living pieces chess game.

“

hen you think of conventions in Alaska, you don’t usually think of them being fun,” says Braxton Bundick, executive director of Alaska’s largest anime convention, Senshi-Con, “but that’s what we’re all about. We just want to have fun.” And that’s what it’s always been about, even in the convention’s early days when it was less of a convention and more of a couple of high school clubs. Since it’s first meeting at the West High School cafeteria in 2005, the convention has only only grown, and grown. From 2006 to 2012 the convention was held at the UAA Student Union, but now that space has also been outgrown. “We were using every available space,” Bundick reports. “People were always requesting that we have more space, and this year we made that happen,” moving to the Egan Center. One of the convention’s popular events is the live cosplay chess tournament: every costumed person represents a piece and engages in battle whenever a piece is “killed.” This year, the two key guests are Katie Tiedrich, who writes and draws Awkward Zombie, an online comic; and Chuck Huber, who is an actor, voice actor, producer, and cinematographer. Last year the convention introduced PC gaming and tournaments, which will be included again this year. Bundick, who volunteers his time, is looking forward to the new venue: “It’s exciting. We’ve grown a lot, and we still have some big ideas for the future. We want this convention to continue year after year.” The convention takes place Saturday, September 28 (11 a.m. to 11 p.m.) and Sunday, September 29 (11 a.m. to 9 p.m.). Tickets range from $25 to $70 and are available online and at Bosco’s. senshicon.net

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 www.akbizmag.com

EVENTS CALENDAR

Compiled by Tasha Anderson

Anchorage 4

Girdwood Surviving the Story

This is an onstage conversation between author Ron Carlson—Return to Oakpine and The Signal—and Don Rearden—The Raven’s Gift— discussing the process of discovery in writing fiction. This is a 49 Writers Crosscurrents event. Anchorage Museum at Rasmuson Center Auditorium, 7 p.m. 49writingcenter.org

5-8

Taste of Mardi Gras

This street party recreates Bourbon Street, featuring authentic Cajun cuisine from local chefs, live music, and street performers; it raises money for the American Red Cross of Alaska. Downtown Anchorage, Fourth Avenue between K and L Streets, 5 p.m. to 10 p.m. anchorage.net

Melissa Marr Book Signing

Bestselling teen author Marr will be on tour for her new book The Carnival of Souls. Events include a costume contest, writing contests (due September 4), art contests (due September 4), face painting, and prizes. Barnes & Noble, 7 p.m. barnesandnoble.com

Anchorage Family Heart Walk

This Walk brings together survivors, families, community teams, and company teams in support of the American Heart Association. Be part of a heart-healthy 5K walk and do your part to fight heart disease and stroke. Delaney Park Strip at Tenth Avenue and N Street, 9 a.m. to Noon. heartwalk.kintera.org/faf/home/default.asp?ievent=1044243

27-29

Alaska Women’s Show

Vendors and participants celebrate the things that make Alaska women unique, featuring financial seminars, fashion shows, jewelry, health care information, and more. Sullivan Arena, various times. auroraproductions.net

Cordova 6-8

Alyeska Climbathon

Homer

Bal-aska

This is a dance workshop providing group classes with master instructors in Balboa and Bal-Swing; open practice dances follow each evening, which let participants practice newly learned steps or socialize and listen to swing and jazz music. Registration/tickets required. Snow Goose Theatre, various times. back2basicsdancecompany.com

This is an endurance event where participants walk, hike, and run up the North Face Trail of Mount Alyeska and then ride the Tram down the mountain as many times as they can between 9 a.m. and 7 p.m. Results and rewards will be given out following the race on the Columbia Patio. Alyeska Resort, registration begins 8 a.m. alyeskaresort.com

Cordova Fungus Festival

A collaboration of the Cordova Chamber of Commerce and US Forest Service, this is a celebration of all things mushroom, with guided forays to find, identify, and learn about wild local mushrooms, natural dye workshops, presentations, and a mushroom-centric dinner. Various locations and times. cordovachamber.com

Eagle River 9

Making Wild Teas

Naturalist Doris Ivory instructs on tea-making and identifying edible plants on a short walk around the Rodak Trail, which is approximately three quarters of a mile. Participants will also be able to sample teas made from rosehips and common weeds. Program is free, $5 parking fee for nonmembers. Eagle River Nature Center, 2 p.m. ernc.org

9/26-10/3

Documentary Film Festival

Tenth annual documentary film festival. Homer Theatre, various times. homertheatre.com

Juneau 7

Community Service Fair & Meet the Candidates Day

This fair provides an opportunity to promote, get more information about, and volunteer for nonprofit organizations, as well as time to get to know and ask questions of the candidates. Nugget Mall, 11 a.m. to 3 p.m. nuggetmalljuneau.com

27-28

Juneau Preparedness Expo

This expo provides information and training in regards to home disaster preparedness/kits for families, those with special needs, etc., first aid training, financial and personal records management, small business preparedness, disaster communications, and emergency planning for pets. Centennial Hall, Friday Noon to 7 p.m. and Saturday 9 a.m. to 4 p.m. juneau.org

Petersburg 5-8

Tongass Rainforest Festival

This nonprofit festival brings attendees closer to the natural world through education, exploration, and the arts while learning more about the rainforest and oceans surrounding it. Events include walking tours, lectures, workshops, and visiting with authors and artists. Various locations and times. tongassrainforestfestival.org

Sitka 28

Season’s End Celebration/Running of the Boots

This is a celebration of the end of another successful visitor and fishing season. It includes free hot dogs, hamburgers, and fish and chips, as well as shopping and the annual Running of the Boots, a fundraiser for the Local Foods Network sponsored by the manufacturer of XtraTuf boots and local merchants. Downtown Sitka, various times. sitkalocalfoodsnetwork.org

Valdez 7

Blues Cruise

This is a fundraiser for the Valdez Arts Council which takes place aboard the Stan Stephens M/V Valdez Spirit and includes appetizers, deserts, and blues music. Stan Stephens M/V Valdez Spirit, 7 p.m. valdezartscouncil.org

Fairbanks 24

Tanana Valley Potato Extravaganza

This fundraiser for Festival Fairbanks is a six course, gourmet meal featuring locally grown potato varieties prepared by the ACF Midnight Sun Chef’s Association and honors local farmers. It also features lives music starting at 6 p.m. by the Foggie Mountain Boys. Pump House Restaurant, 6 p.m. to 9 p.m. festivalfairbanks.org

Girdwood 7-8

Bike MS Alaska

Bike MS features 25- to 110-mile route options along with a festival atmosphere, great food, music, a beer garden, and a Saturday evening rally. Funds support research, programs, and services for people living with multiple sclerosis in communities across the Northwest. Alyeska Day Lodge, various times. bikeMSnorthwest.org www.akbizmag.com

September 2013 | Alaska Business Monthly

139

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Alaska Business Monthly | September 2013

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141

October in Alaska Business Monthly

TOP 49ERS SPECIAL SECTION ■ Alaska’s Top 49 Alaskan-Owned Companies ■ Six Proﬁles of Top 49ers

29th Year

FEATURE ARTICLES

2013

Top 49ers L

Wednesday October 2, 2013 11:30 am — 1:00 pm Dena’ina Civic & Convention Center Anchorage, Alaska

Join us as we honor the Top 49 Alaskan-owned and -operated businesses ranked by gross revenue. Last year’s combined $16.16 billion in revenue contributed jobs, growth, and stability to the Alaska economy. Discover this year’s companies and celebrate the Top 49ers at this annual awards luncheon enjoyed by the business community. M A K E Y O U R R E S E R VA T I O N S E A R LY ! Ta b l e o f 1 0 — $ 4 9 0 I n d i v i d u a l S e a t i n g — $ 4 9 (Space is limited, event may sell out early)

akbizmag.com/store or call Melinda at 907-257-2901 (907) 276-4373 I Fax (907) 279-2900 I Toll Free (800) 770-4373 akbizmag.com 142

Alaska Business Monthly | September 2013

■ Alaska Native Services for Health & Wellbeing ■ Vertical Construction Renovations ■ Rural Energy Distribution Off the Railbelt, On the Road ■ Urban Water and Wastewater Systems ■ Alaska Permanent Fund Corporation ■ Beer Powered Beer ■ Proactive Safety Programs ■ Tax Policy Impact on Oil Production ■ Using Modern Technology for Oil Recovery ■ Mobile Migration Models ■ Natural Gas as a Fuel for Moving Freight ■ Top Destinations & Activities in Alaska ■ View from the Top

DEPARTMENTS & COLUMNS ■ From the Editor ■ Inside Alaska Business ■ Right Moves ■ Agenda ■ Legal Speak ■ ATM Dining, Travel, Entertainment ■ Events Calendar ■ Alaska Trends

DON’T MISS THIS DEADLINE ■ P2P Entrepreneurial Contest September 16, 5 p.m. AKDT: Registration and concept description deadline for the Southeast sustainable business competition sponsored by the Haa Aani Community Development Fund and The Nature Conservancy. October 11–13: Boot Camp Weekend December 16, 5 p.m. AKDT: Business Plan submission deadline January 20, 2014: Notiﬁcation of Winners January 29 – 30, 2014: Winners attend Innovation Summit p2pweb.org

www.akbizmag.com

ALASKA TRENDS

By Michael Malone

State and Local Support for Higher Education Alaska ranks second in the nation

Alaska Trends, an outline of significant statewide statistics, is provided by the University of Alaska Center for Economic Development.

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

he financial support that universities, comState and Local Support for Higher Education munity colleges, and trade schools receive Per Capita from state and local government is a major $500 source of funding. The National Center for Higher Education Man- $450 agement Systems provides state policymakers and $400 analysts timely and accurate data and information $350 that are useful in making sound higher education $300 policy decisions. The Center ranks Alaska second nationally for $250 2011, with $473.43 in state and local government ex- $200 penditure for higher education general expense per capita. Wyoming is first in the nation for 2011 with $150 spending of $605.97 per capita, the average state ex- $100 Alaska penditure for 2011 is $242.45 per capita, and New US $50 Hampshire is ranked last nationally with $104.35 per $0 capita. This metric is calculated by taking state and local support for higher education general operating expenses divided by total population. General operating expenses include tax and non-tax (e.g. lottery proceeds) support for public and independent higher education. has slowed considerably. The national average of support per The chart shows Alaska’s support per capita versus the na- capita has lagged well behind Alaska. The gap between the US tional average from 2001 through 2011. Alaska’s state and local and Alaska has grown from 38 percent in 2001 to 95 percent in governments have provided an increasing level of support year- 2011. According to the report, since the 2008 financial crisis the on-year for higher education operating expenses per capita. In national average of support per capita has fallen each year. This 2007, the level of support increased 13 percent over the prior may be related to the slowing growth in tax revenues and higher year; the most recent two years show the year over year increase social service costs in many of the other fourty-nine states.  SOURCE: State Higher Education Executive Ofﬁcers, National Center for Higher Education Management Systems

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143

ALASKA TRENDS

Indicator

By Paul Davidson

Units

Period

Latest Report Period

Previous Report Period (revised)

Year Over Year Change

Year Ago Period

GENERAL Personal Income – Alaska US $ 1st Q13 34,420 34,667 33,342 Personal Income – United States US $ 1st Q13 13,589,477 13,760,443 13,137,224 Consumer Prices – Anchorage 1982-1984 = 100 1st H13 210.85 206.62 205.22 Consumer Prices – United States 1982-1984 = 100 1st H13 232.37 230.34 228.85 Bankruptcies Alaska Total Number Filed May 57 78 59 Anchorage Total Number Filed May 47 47 43 Fairbanks Total Number Filed May 7 19 5 EMPLOYMENT Alaska Thousands May 342.50 336.98 341.98 Anchorage & Mat-Su Thousands May 188.21 187.72 187.91 Fairbanks Thousands May 44.54 43.48 44.70 Southeast Thousands May 38.26 35.83 38.56 Gulf Coast Thousands May 37.17 35.99 36.98 Sectorial Distribution – Alaska Total Nonfarm Thousands May 334 327 337.3 Goods Producing Thousands May 44.0 43.9 45.5 Services Providing Thousands May 289.8 282.6 291.8 Mining and Logging Thousands May 17.8 17.5 17.0 Mining Thousands May 17.2 17.0 16.7 Oil & Gas Thousands May 14.3 14.1 13.6 Construction Thousands May 17.1 15.7 16.5 Manufacturing Thousands May 9.1 10.7 12.0 Seafood Processing Thousands May 5.0 6.7 8.2 Trade/Transportation/Utilities Thousands May 66.4 62.4 65.4 Wholesale Trade Thousands May 5.9 5.9 6.3 Retail Trade Thousands May 36.9 35.2 36.3 Food & Beverage Stores Thousands May 6.1 6.0 6.3 General Merchandise Stores Thousands May 10.2 9.8 9.8 Trans/Warehouse/Utilities Thousands May 23.6 21.3 22.8 Air Transportation Thousands May 6.0 5.6 6.0 Information Thousands May 6.1 6.0 6.3 Telecommunications Thousands May 4.0 3.9 4.2 Financial Activities Thousands May 13.5 13.1 13.4 Professional & Business Svcs Thousands May 28.7 27.9 28.9 Educational & Health Services Thousands May 47.4 47.7 46.4 Health Care Thousands May 33.8 33.5 33.0 Leisure & Hospitality Thousands May 33.2 29.5 34.8 Accommodation Thousands May 7.7 6.7 8.2 Food Svcs & Drinking Places Thousands May 20.9 18.8 21.3 Other Services Thousands May 11.6 11.4 11.8 Government Thousands May 82.9 84.6 84.8 Federal Government Thousands May 15.2 14.9 16.7 State Government Thousands May 25.7 26.9 26.0 State Education Thousands May 7.5 8.7 7.5 Local Government Thousands May 42.0 42.8 42.1 Local Education Thousands May 23.0 24.1 24.0 Tribal Government Thousands May 3.4 3.4 3.6 Labor Force Alaska Thousands May 364.32 359.42 367.34 Anchorage & Mat-Su Thousands May 198.34 198.22 199.97 Fairbanks Thousands May 46.98 45.98 47.57 Southeast Thousands May 40.38 38.15 41.11 Gulf Coast Thousands May 39.76 38.75 40.04 Unemployment Rate Alaska Percent May 6 6.2 6.9 Anchorage & Mat-Su Percent May 5.1 5.3 6 Fairbanks Percent May 5.2 5.5 6 144

Alaska Business Monthly | September 2013

3.23% 3.44% 2.74% 1.54% -3.39% 9.30% 40.00%

0.15% 0.16% -0.35% -0.78% 0.52% -1.04% -3.30% -0.69% 4.71% 2.99% 5.15% 3.64% -24.17% -39.02% 1.53% -6.35% 1.65% -3.17% 4.08% 3.51% 0.00% -3.17% -4.76% 0.75% -0.69% 2.16% 2.42% -4.60% -6.10% -1.88% -1.69% -2.24% -8.98% -1.15% 0.00% -0.24% -4.17% -5.56% -0.82% -0.81% -1.25% -1.77% -0.69% -13.04% -15.00% -13.33% www.akbizmag.com

ALASKA TRENDS

Indicator

Southeast Gulf Coast United States

By Paul Davidson

Units

Period

Latest Report Period

Previous Report Period (revised)

Percent Percent Percent

May May May

5.3 6.5 7.6

6.1 7.1 7.5

Year Ago Period

6.2 7.7 8.2

PETROLEUM/MINING Crude Oil Production – Alaska Millions of Barrels May 15.97 15.67 16.93 Natural Gas Field Production – Alaska Billions of Cubic Ft. May 6.96 8.40 8.99 ANS West Cost Average Spot Price $ per Barrel May 104.42 104.58 110.55 Hughes Rig Count Alaska Active Rigs May 8 8 6 United States Active Rigs May 1767 1755 1977 Gold Prices $ Per Troy Oz. May 1,416.14 1,485.90 1,585.11 Silver Prices $ Per Troy Oz. May 23.02 25.2 28.67 Zinc Prices Per Pound May 0.91438 0.926315 1.00 REAL ESTATE Anchorage Building Permit Valuations Total Millions of $ May 34.67 92.05 47.93 Residential Millions of $ May 23.46 18.68 21.16 Commercial Millions of $ May 11.21 73.37 26.77 Deeds of Trust Recorded Anchorage–Recording District Total Deeds May 1275* 1234 1065* *GeoNorth Fairbanks–Recording District Total Deeds May 337 294 358

Year Over Year Change

-14.52% -15.58% -7.32%

-5.67% -22.58% -5.55% 33.33% -10.62% -10.66% -19.71% -8.56%

92.05% -11.72% 174.08% 19.79% -5.87%

VISITOR INDUSTRY Total Air Passenger Traffic – Anchorage Total Air Passenger Traffic – Fairbanks

Thousands Thousands

May May

437.89 85.07

321.35 64.72

428.54 87.91

2.18% -3.23%

ALASKA PERMANENT FUND Equity Assets Net Income Net Income – Year to Date Marketable Debt Securities Real Estate Investments Preferred and Common Stock

Millions of $ Millions of $ Millions of $ Millions of $ Millions of $ Millions of $ Millions of $

May May May May May May May

46,269.60 47,102.90 214.7 -232.8 -232.8 -26.1 -98.4

46,434.60 47,354.60 289.4 852.4 89.7 55.70 454.4

40,082.70 40,687.60 (1,648.9) (926.8) (16.2) (19.10) (1,700.0)

15.85% 16.39% -117.55% -191.97% -653.70% -391.62% -126.73%

BANKING (excludes interstate branches) Total Bank Assets – Alaska Cash & Balances Due Securities Net Loans and Leases Other Real Estate Owned Total Liabilities Total Bank Deposits – Alaska Noninterest-bearing deposits Interest- bearing deposits

Millions of $ Millions of $ Millions of $ Millions of $ Millions of $ Millions of $ Millions of $ Millions of $ Millions of $

1st Q13 1st Q13 1st Q13 1st Q13 1st Q13 1st Q13 1st Q13 1st Q13 1st Q13

2,163.28 45.15 135.91 1,201.04 7.31 1,894.70 1,837.36 567.54 1,269.82

2,203.51 58.83 133.54 1,159.55 6.75 1,926.65 1,877.43 599.27 1,277.86

2,085.52 38.36 138.30 1,124.51 7.98 1,820.76 1,775.89 509.26 1,266.63

3.73% 17.70% -1.73% 6.81% -8.40% 4.06% 3.46% 11.44% 0.25%

FOREIGN TRADE Value of the Dollar In Japanese Yen In Canadian Dollars In British Pounds In European Monetary Unit In Chinese Yuan

Yen Canadian $ Pounds Euro Yuan

May May May May May

100.86 1.02 0.65 0.77 6.19

97.76 1.02 0.65 0.77 6.24

79.73 1.01 0.63 0.78 6.31

22.61% 0.99% 3.17% -1.28% -1.11%

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September 2013 | Alaska Business Monthly

145

Advertisers indeX AES Alaska Executive Search ..........................15 Ahtna Inc.....................................................................127 Alaska Air Cargo - Alaska Airlines ............... 93 Alaska Air Transit ..................................................136 Alaska Boat Brokers............................................ 137 Alaska Chamber ....................................................119 Alaska Dreams Inc...............................................102 Alaska USA Federal Credit Union.................19 Alchem Inc. ..................................................................72 American Fast Freight ........................................80 American Marine / PENCO............................143 Anchorage Chrysler Dodge ...........................30 Apache Alaska Corp..............................................54 Arctic Controls .........................................................72 Arctic Office Products (Machines) .............97 Arctic Slope Regional Corp. ASRC .............99 AT&T ................................................................................13 Bering Straits Native Corp. ...........................101 Bristol Bay Native Corp......................................95 Calista Corp. .............................................................117 Capture the Fun Alaska LLC ........................140 Carlile Transportation Systems..................... 41 CCI Industrial............................................................. 57 Chris Arend Photography ..............................146 Clarion Suites Downtown / Quality Suites Near Convention Center..........................137 Construction Machinery Industrial LLC ....2 Cook Inlet Tug & Barge Inc. ..............................54

146

Crowley..........................................................................83 Cruz Construction Inc. ........................................ 67 Delta Leasing LLC ................................................110 Design Alaska ............................................................22 Donlin Gold ...............................................................112 Dowland-Bach Corp. .............................................71 Doyon Limited ........................................................107 EDC Inc. ......................................................................... 21 Eklutna Native Corp.............................................115 Engineered Fire & Safety ..................................60 ERA ALASKA ..............................................................31 ERA Helicopters .......................................................73 Expense Reduction Analysts ........................141 Fairbanks Convention & Visitors Bureau .121 Fairbanks Memorial Hospital ......................... 91 Fairweather LLC ......................................................87 First National Bank Alaska ..................................5 Fountainhead Hotels ............................................43 GCI .........................................................................59, 147 Grant Thornton LLP ...............................................61 Green Star Inc. ......................................................140 Holmes Weddle & Barcott..............................116 Hotel Captain Cook ............................................103 Island Air Express .................................................138 Judy Patrick Photography .................................73 Kakivik Asset Management ..............................53 Landye Bennett Blumstein LLP.....................27 Little Caesar Enterprises Inc. ......................141

Alaska Business Monthly | September 2013

Lounsbury and Associates................................59 Lynden Inc. ...................................................................55 MagTec Alaska LLC ................................................58 McKinley Service & Equipment Inc. ...........58 Medical Park Family Care ................................90 Mikunda Cottrell & Co. / BDO .....................116 N C Machinery ..........................................................65 NANA Regional Corp. ...........................................37 NCB ..................................................................................97 North Star Behavioral Health ........................89 Northern Air Cargo ..................................134, 135 Northland Services................................................79 Northrim Bank ...........................................................17 Northwest Strategies...........................................45 NTCL ..............................................................................60 Offshore Systems Inc...........................................52 Olgoonik Development Corp. ........................69 Oxford Assaying & Refining Inc. .................139 Pacific Alaska Freightways...............................23 Pacific Pile & Marine ................................8, 9, 10 Pacific Rim Media/ Smart Phone Creative...................................15 Paramount Supply................................................141 Parker, Smith & Feek..............................................51 Patton Boggs.......................................................... 120 Pebble Partnership ................................................98 Pen Air ..........................................................................84 Personnel Plus ........................................................136

PistenBully..................................................................44 Praxis Medical Arts ...............................................47 Procomm Alaska ......................................................38 Remax / Dynamic Properties-Matt Fink...22 Rotary District 5010...........................................138 Sam’s Club .....................................................................11 Scan Office ..................................................................39 SeaTac Marine Services ......................................78 Seekins Ford Lincoln Fleet................................68 Spenard Builders Supply ...................................25 Stellar Designs Inc. .............................................140 T. Rowe Price ...............................................................35 TDX Power ..................................................................29 The Tatitlek Corp. ...................................................27 Todd Communications ....................................140 Totem Ocean Trailer Express (TOTE) .......82 Trailercraft Inc. Freightliner of Alaska......81 True North FCU ...................................................140 UIC Bowhead-Crowley LLC ............................ 77 Ukpeagvik Iñupiat Corporation ...................113 University of Alaska Southeast ..................... 21 Visit Anchorage........................................................49 Washington Crane & Hoist ...............................33 Waste Management ..............................................75 Wells Fargo ..............................................................148 West-Mark Service Center ............................141 WHPacific ....................................................................23 XTO Energy ..................................................................3

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