Catching Up on Alaska’s Fisheries

DIRECTORY

A wise man once predicted that the times would be a-changin’. Turns out, he was right.

With yet another administration dishing out executive orders left and right, it would appear that change is back on the menu. But questions remain as to how fast… and in what direction?

This month’s cover story aims to address these questions. “Meeting in the Middle” explores the surprisingly dynamic relationship Alaskans have with fossil fuels and renewable energy in an increasingly carbon-concerned world. While the concern is certainly warranted and even acknowledged among Alaska’s petroleum players, one thing remains clear: the world still needs oil and gas.And the latest cover of Alaska Business inspires visions of how fossil fuels and clean energy can coexist.

Cover Art by Monica Sterchi-Lowman

ormed nearly a century ago, Papua New Guinea-based Oil Search entered Alaska’s oil and gas scene in 2018 with a $400 million purchase of North Slope oil leases from Armstrong Energy and GMT Exploration. The purchase included interests in the Nanushuk oil field in the Pikka Unit, one of the largest conventional US oil discoveries in thirty years, and the Horseshoe block.

“We entered into Alaska for new growth and to diversify our operations, both geographically and for a mix of oil and gas production,” Executive Vice President of Alaska Bruce Dingeman told attendees at the Alaska Support Industry Alliance’s Meet Alaska conference in March.

hile the lion’s share of attention on Alaska’s oil and gas industry centers on the North Slope, the Cook Inlet region is still home to twenty-eight producing oil and gas fields on- and offshore.

Between rigs operating in the inlet itself and refineries based in areas like the Kenai Peninsula, Cook Inlet is a crucial—and sometimes overlooked—piece of Alaska’s oil and gas industry.

Cook Inlet represents roughly 3 to 4 percent of all oil extracted in Alaska; while that pales in comparison to North Slope production, for example, it shines in terms of how much of that oil actually ends up being used in the state. As of publication, approximately 15,000 barrels of oil are produced each day in Cook Inlet, and all of that oil stays right in Alaska, refined at the Marathon plant in Nikiski.

n January, when the Biden administration announced its ban on the future sale of oil and gas leases on federal land, the news understandably ruffled the collective feathers of Alaska’s oil and gas industry. The announcement could be—and has often been—framed as a direct attack on one form of energy development in favor of another.

But a closer look at insights from parties in both the oil and gas and renewable energy sectors reveals that as far as Alaska is concerned, the two energy industries aren’t necessarily at odds. In fact, many industry experts agree that oil, natural gas, solar, hydro, geothermal, and tidal can all be developed in Alaska without one encroaching on the other’s economic importance to the state. Combined, petroleum and renewables are a positive one-two punch for Alaskans, not ideologically opposed platforms locked in some industrial grudge-match. There are similarities between oil and gas and green energy as well as differences—all of which are necessary for the dynamic relationship to work in the first place.

A misconception exists that implies fossil fuels and renewables are like oil and water (no pun intended). While it might be true elsewhere, this isn’t necessarily the case in Alaska. However, as the new presidential administration begins to establish domestic energy policies focused on more investments in green energy and less in federal lands for oil and gas use, the fear of Alaska’s petroleum sector being severely stifled has caused some headaches for industry stakeholders.

But for all the hype surrounding the green energy and fossil fuel debate, both platforms exist in the state to serve different functions; while oil and gas continue to bring in state revenue through royalties and a tax structure (not to mention money for Permanent Fund Dividends), green energy serves to keep more money in individual, utility-paying Alaskans’ pockets via energy efficiency savings. Less use of traditional energy sources like diesel (especially in rural Alaska) and more reliance on platforms like solar and wind mean lower long-term costs for consumers.

ollowing the purchase of BP’s 26 percent interest in Prudhoe Bay in June 2020, Hilcorp became the state’s second-largest oil producer in Alaska.

This year, the privately held company has said it will begin a fast-paced gas and oil exploration plan at its Whiskey Gulch prospect on the Kenai Peninsula, bring gas at its Seaview prospect near Anchor Point to market, and drill a bevy of test wells for future gas development in Cook Inlet. On the North Slope, Hilcorp plans to continue BP’s path of development at Prudhoe Bay and continue with an ongoing and promising collaboration with the University of Alaska Fairbanks and other groups to pull heavy oils from mature wells.

orth Slope workers fly in to work on a Boeing 737 owned by one of the borough’s largest oil producers and then spend two weeks working 12- to 16-hour shifts while living in camps alongside their coworkers. Or that used to be a standard operating procedure before the worldwide pandemic.

So what happened in 2020 on the North Slope, where people live and work in close, communal environments and a novel coronavirus pandemic forced everyone to take a little more space?

Alaska’s oil and gas industry is accustomed to the yo-yoing of economic cycles, but COVID-19 was a whole new issue to bounce back from. It caused companies to quickly reassess and implement new safety measures, such as mandating health check-ups for employees before they could travel to various locations from Fairbanks or Anchorage.

ining is the tedious and feverish work of digging precious things out of the ground. Gold mining in Alaska carries with it the sepia-toned nostalgia of 49ers carefully sifting through the infinite waters for tiny flakes of wealth. Those in the industry call this strategy of mining placer mining. And while a few may have made their fortunes that way, both laziness and ambition caused people to search for a more direct path to success. Placer mining is feasible because water flows around and through rock formations with gold veins, slowly eroding the gold and refining it as the water flows downstream. But why not just get the gold directly from the vein?

Lode mining, or hard rock mining, is mining minerals from their very source. As the name implies, hard-rock mining requires a lot more force than letting a stream gently move sediment through settling screens. Even with an army of whistling dwarves to manually chip away at the stone, first one must answer the challenge of getting to the mineral deposit, which is often deep underground. Gold is not the only valuable resource at stake; Alaska mining also produces silver, zinc, lead, and other minerals in smaller quantities. Mining in Alaska has grown to the point that minerals are Alaska’s second largest export commodity.

here’s no doubt that 2020 wasn’t a good year, and this is especially true for those in Alaska’s fishing industry. Between having to take pandemic precautions, seeing smaller runs of some fish species, and losing markets as restaurants throughout the state shut down, it was not a banner time. And though nothing is set in stone for 2021, there’s hope that the industry, at least in some areas, will be able to recover.

Denali National Park and Preserve is implementing an opportunity for private vehicles to access usually restricted portions of Denali Park Road during the 2021 summer season via a reservation system. This opportunity is in response to ongoing impacts of the COVID-19 pandemic. Continuing daily through September 12, 2021, the public will have access to the Park Road beyond the Savage River Check Station (mile marker 15) to the Teklanika Rest Stop (mile marker 30) using a $25 permit called the Teklanika Road Permit. The Teklanika Road Permit is available for reservations through recreation.gov. This system allows the public to reserve one of a limited number of daily scheduled entries to the Park Road by private vehicle. nps.gov/denali | recreation.gov

3-Tier Alaska, a land surveying and civil engineering company, and Travis/Peterson Environmental Consulting have joined forces. The merger expands and deepens the combined company’s civil, environmental, land surveying, and water system design services across Alaska. 3-Tier Alaska, founded by Jim Ringstad in the early ’80s, specializes in land surveying and civil engineering for land use projects across Alaska. In 2018, Ringstad’s son, Nick, took over and grew the company from two to twelve full-time employees. Travis/Peterson, founded in 1998 by Michael Travis and Larry Peterson, specializes in environmental engineering and consulting. The company has seven full-time employees including professional engineers, biologists, geologists, and environmental scientists, as well as seasonal staff. 3tieralaska.com | tpeci.com

orty years ago, Mike Colombie packed his bags and went North in search of adventure. And it didn’t take long to find it—he received his pilot’s license only three years after landing in Alaska.

Colombie started with CONAM as a document control clerk and moved his way on up pretty dang quick, spending time as a field engineer and dabbling in project management. Today, Colombie serves as the construction firm’s president with twenty-five years of experience between CONAM and its sister company Price Gregory.