ABM April 2014 by Alaska Business

CONVENTIONS & CORPORATE TRAVEL | MINING IMPACT | LOGISTICS | ENERGY DEVELOPMENT

April 2014

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April 2014 TA BLE OF CONTENTS ABOUT THE COVER

DEPARTMENTS

Two partake of an executive view from a boardroom in Anchorage—the city where most corporations doing business in Alaska have ofﬁces. Alaska Business Monthly’s annual Corporate 100 special section begins on page 110.

From the Editor. . . . . . . . . . . . . . . . . . . .7 Agenda . . . . . . . . . . . . . . . . . . . . . . . . 69 Right Moves . . . . . . . . . . . . . . . . . . . 156 Inside Alaska Business . . . . . . . . . . . 158 Alaska This Month . . . . . . . . . . . . . . 161 Events Calendar . . . . . . . . . . . . . . . . 164 What’s Next . . . . . . . . . . . . . . . . . . . 165 Market Squares . . . . . . . . . . . . . . . . 165 Alaska Trends . . . . . . . . . . . . . . . . . . 167 Ad Index . . . . . . . . . . . . . . . . . . . . . . 170

ARTICLES

VIEW FROM THE TOP

Alaska Clean Seas offshore spill response vessels stand ready on the North Slope.

Photo courtesy of Alaska Clean Seas

8 | Michael West State Seismologist Compiled by Tasha Anderson

ICONIC ALASKANS 10 | Jim Posey By Shehla Anjum

COMMENTARY

16 | U.S. Relationships with Asia-Pacific Region: A confluence of imperatives for Alaska By Dr. Walter Skya and Dr. Ashok K. Roy

ENTREPRENEURS

30 HEALTH & MEDICINE

MINING

30 | Oil Spill Response Organizations: Always Ready Constant training and diligence in industrial accident prevention and response By Vanessa Orr

36 | Donlin Gold’s Big Impact ‘A really big deal’ By Julie Stricker 40 | Enormous Impact of Alaska’s Producing Mines The big six pour money into local and state economies By Julie Stricker

CONSTRUCTION

48 | Mod Man Camps for Mining ‘All the amenities of home’ By Louise Freeman

Photo courtesy of Donlin Gold

22 | Path to Prosperity: Extract, Then Add Value A unique contest in Southeast Alaska rewards innovation By Dustin Solberg

FINANCIAL SERVICES

26 | Employer Retirement Plans More Alaska Business Owners Selling their Companies for Retirement By Tracy Barbour

TELECOM & TECHNOLOGY

70 | Businesses Leverage Cloud, Wireless, and Internet Improving efficiency, expanding capabilities with telecom solutions By Tracy Barbour

Ricky Ciletti in the core shack. 4

Alaska Business Monthly | April 2014

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April 2014 TA BLE OF CONTENTS special section

special section

Conventions & Corporate Travel

Corporate 100

CORPORATE SPOTLIGHT

A reception in the Dena’ina Civic and Convention Center.

56 | Economic Impact of CVBs Attracting travelers to communities By Julie Stricker

136

62 | Corporate Travel in Alaska Rich in private, commercial, and collaborative options for business travelers By Tom Anderson

Geneva Woods infusion lab.

110 | 2014 Corporate 100 Top Citizens of Industry Directory 134 | 2014 Corporate 100 By Business Category and Total Employment Figures

66 | Conventions in Alaska Taking the one-on-one approach By Vanessa Orr

Photo courtesy of Al Kiefer | Geneva Woods

Photo courtesy of Nicole Geils

136 | Geneva Woods Focusing on patient-centered care By Rindi White 140 | Fairbanks Memorial Hospital ‘People First’ By Julie Stricker 142 | Franz Bakery Alaskans kneading the dough By Julie Stricker

PHILANTHROPY

144 | Trends in Corporate Giving Year-over-year model helps execs make a difference By Nicole A. Bonham Colby

ECONOMY

148 | Economic Impact of the Corporate 100

ARTICLES

ALASKA NATIVE CORPORATIONS

LEGAL SPEAK

75 | Federal Income Tax Incentives for Alaska Businesses By Kevin Pearson

76 | Investing in Energy Developing sustainability By Julie Stricker

OIL & GAS

82 | The Alaska LNG Project Another natural gas partnership By Mike Bradner

ECONOMIC DEVELOPMENT

166 | New Business Enterprise Institute at University of Alaska Anchorage Seeing more effective statewide engagement with business community By Nolan Klouda

Correction

Photo by Judy Patrick

88 | Maintaining Integrity in an Aging Oilfield By Paula Cottrell

A KAKIVIK Chem Lab Technician measuring for corrosivity. 6

Alaska Business Monthly | April 2014

92 | Platform Renaissance Built mostly in the 1960s, Cook Inlet oil and gas leviathans still have some life left By Wesley Loy

TRANSPORTATION

102 | Logistics and Scheduling Alaska’s unique position on the globe By Rindi White

Grummett

Little

Due to an editing error in the March 2014 issue, Stacy Grummett, President of Shattuck and Grummett Insurance, and Adrienne Little, Insurance Sales Executive for Wells Fargo Insurance Services, pictured above, were incorrectly identiﬁed. We apologize for the error. www.akbizmag.com

FROM THE EDITOR Follow us on and

Volume 30, Number 4 Published by Alaska Business Publishing Co. Anchorage, Alaska Vern C. McCorkle, Publisher 1991~2009

EDITORIAL STAFF Managing Editor Editorial Assistant Art Director Art Production Photo Consultant Photo Contributor

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

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

Jim Martin Charles Bell Anne Campbell Michelle Melendez 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, ©2014, 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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hough it’s hard to know if winter is really over this time of year, at least it’s light out, and that tells me spring is here, and with it is our annual Corporate 100 special section (page 110) where we name one hundred companies doing business in Alaska to honor their contributions to Alaska. This year’s Top Citizens of Industry all share in, well, sharing. A sense of community, actions of volunteerism, and a myriad of contributions are found throughout the ranks of the Corporate 100, across the great state of Alaska, and in some cases, beyond the borders of the United States. Millions of dollars in both cash and in-kind donations are made to a multitude of nonproﬁt and educational organizations and other community and service associations by the Corporate 100. We see this in ways such as ASRC’s Ty Hardt climbing Mount Everest to raise funds for Boys and Girls Clubs-Alaska to corporate and personal participation in fundraising events such as the Empty Bowl project to raise money for Bean’s Café and the Children’s Lunchbox. Many employees of the Corporate 100 companies volunteer their time (both on-the-clock and off) to help Alaska communities grow and thrive in every region. Collectively, we’re talking about tens of thousands of volunteer hours a year—teaching ﬁnancial literacy classes for Junior Achievement, pounding nails for Habitat for Humanity, CANstruction for the hungry, coaching youth sports—thousands of charitable and civic endeavors. Incorporating community-minded values into business models is an integral cultural component of these Top Citizens of Industry. Companies also pay for scholarships, help fund foundations, support the arts, celebrate Alaskan events, promote health and wellbeing, and otherwise contribute time and money with the intent of making the world a better place. In fact, “Trends in Corporate Giving: Year-overyear model helps execs make a difference” by Nicole A. Bonham Colby (page 144) is an excellent article about this very topic. Speaking of excellent articles, the April issue, at 172 pages, is host to a couple dozen excellent articles. The team at Alaska Business Monthly has put together another really great magazine, enjoy! —Susan Harrington, Managing Editor April 2014 | Alaska Business Monthly

View from the Top

Compiled by Tasha Anderson

Michael West State Seismologist Alaska Earthquake Center, Director

ÂŠ JR Anchetta

he seismogram State Seismologist and Alaska Earthquake Center Director Michael West holds (facing page) is the actual paper helicorder record from the March 27, 1964, Great Alaska Earthquake, recorded in Fairbanks. The paper holds twenty-four hours of seismic data. There were two seismic stations in Alaska in 1964—Fairbanks and Sitka. This is the actual record of the earthquake as recorded in Alaska. According to the Alaska Earthquake Information Center website, the magnitude 9.2 earthquake is the second largest ever recorded in the world, and the duration of rupture was approximately four minutes. The earthquake was felt throughout all of Alaska and in parts of Canada and Washington state and triggered landslides and avalanches. A tsunami fanned out from the Gulf of Alaska to Hawaii, Oregon, and California. The area of “signiﬁ cant damage,” according to the website, was 130,000 kilometers and the quake was felt over an area 1.3 million square kilometers. The damage totaled $300 million to $400 million in 1964 dollars, more than $2.3 billion in today’s dollars. Earthquakes have never been far from the minds of Alaskans since, not only because of the cultural impact of the devastation and loss, but because of Alaska’s incredible amount of seismic activity. This seismic activity makes it an ideal location for earthquake research, hence the Geophysical Institute at the University of Alaska Fairbanks. At the 50th anniversary of the Great Alaska Earthquake, West provides insight to Alaska’s earthquake history and seismic future, and shares a little bit about himself. WHAT BROUGHT YOU TO ALASKA? My wife, Krista, and I were living in New Mexico when a faculty job came up at the Geophysical institute at UAF. We jumped at the opportunity. The job was the catalyst, but Fairbanks was the draw. Fairbanks, and Alaska as a whole, has an incredible sense of place that encourages people to think big and live deliberately. This fit what we wanted in a community. It is hard to imagine raising our three boys anywhere else now.

The most ambitious seismic project yet is currently ramping up in Alaska. “EarthScope” is a national project that is temporarily blanketing the state with seismic instrumentation on a grid spaced at fift y miles. We have an unprecedented opportunity right now to leverage this project in ways that will provide earthquake monitoring in western Alaska and on the North Slope where we do not have suﬃcient information to understand why earthquakes occur.

WHAT SPARKED YOUR INTEREST IN SEISMOLOGY? As a physics undergraduate at Colorado College I took an intro geology course for fun. I soon discovered that the union of these two fields, geophysics, provided tools for understanding the natural hazards all around us. I was drawn to earthquake seismic data because it is so rich with information. Everything we want to know is recorded in seismograms—you just have to know how to tease it out.

DO YOU THINK ALASKA IS PREPARED FOR ANOTHER QUAKE OF THAT MAGNITUDE, WERE IT TO TAKE PLACE? We will never be fully prepared for an earthquake like 1964. But if we track seismic activity well over the course of years, we can develop a good understanding of what types of earthquakes to anticipate in different areas. This has not been done across much of the state. As a result it is hard to make wellinformed development decisions in many places. I believe this is an increasing liability in Alaska.

HOW DID YOU COME TO YOUR CURRENT POSITION AS STATE SEISMOLOGIST? I spent my first several years at UAF pursuing projects in Russia, Mexico, and Bolivia. I was also part of the Alaska Volcano Observatory. I found myself drawn increasingly to practical earthquake applications and the systems and personnel that make it possible. The most compelling earthquake is always the one that just happened. In 2012 I was approached to serve as State Seismologist and director of the Alaska Earthquake Center. I feel fortunate to be involved in something that directly impacts the state and is tied so closely to the landscape around us.

WHAT DO YOU LIKE MOST ABOUT YOUR WORK WITH THE ALASKA EARTHQUAKE CENTER, THE GEOPHYSICAL INSTITUTE, AND UAF? Because Alaska is home to four out of five earthquakes in the United States, it is a very rewarding place to be a seismologist. I work with a spectacular team of eighteen people who maintain the seismic network and analyze earthquakes. Last year we reported 28,000 earthquakes in the state. Of these, 101 were felt by people. We never know what is going to happen on a given day. When an earthquake or eruption or tsunami occurs, the adrenaline is high because we know that people are counting on us to provide the right information THIS YEAR IS THE 50TH ANNIVERSARY OF THE 1964 quickly. This is what drives us. GREAT QUAKE—HOW DID THAT EVENT SHAPE SEISMIC RESEARCH? The 1964 earthquake was a watershed mo- CAN EARTHQUAKES BE PREDICTED WITH ANY RELIABILment in earth science. The earthquake helped prove the idea of ITY? Earthquakes cannot yet be meaningfully forecast. Major plate tectonics and demonstrated to the world that Alaska was advances are occurring, however, in Earthquake Early Warning. the place to study these processes. 1964 changed the course of California, Oregon, and Washington are currently implementing development in Alaska. Though the earthquake’s impact was systems that can allow several tens of seconds of advance warntragic and a huge economic setback just five years after state- ing before strong shaking begins—enough time to shut down hood, it prompted very forward-looking decisions as we rebuilt. machinery and get out of harm’s way. A similar system in Japan Most Alaskans now understand that earthquakes are part of alerted many residents to the 2011 earthquake shortly before the our landscape and that developments large and small can be shaking began. The prevalence of earthquakes in the state, combuilt wisely if the earthquake hazards are actually understood bined with our unique infrastructure and single points of failure, make Alaska an ideal place to pursue such a system.  at the outset. www.akbizmag.com

April 2014 | Alaska Business Monthly

ICONIC ALASKANS

Jim Posey By Shehla Anjum

im Posey was ten and living in Beaumont, Texas, when the Alaska Statehood Act passed in 1958, stripping Texas of its bragging right as the nation’s largest state. “Like all Texans I had an attitude about being number one. It bothered me that Texas was no longer the mighty, bold, and grand state of our state song.” Curious about the place that had usurped his home state’s top spot, Posey started reading about it. “In a National Geographic article about life in Alaska, I read about kids going to school in the dark. I thought that it didn’t sound so bad. I also knew the president was not going to go back on his word to let Alaska in, and I decided if you can’t beat them, join them.” Posey made it to Alaska in 1979 to work for Arco and to begin his career here. All five of his children were born here. Now sixty-seven, Posey retired at the end of 2013 as general manager of Anchorage’s city-owned Municipal Light & Power (ML&P). Posey’s working life began at an early age. “I started working with my dad at his cleaning job at a savings and loan in Beaumont before I was eleven. I got my Social Security card in 1957, when one 10

Alaska Business Monthly | April 2014

Iconic Alaskan Jim Posey in front of the Kincaid Chalet at Kincaid Park in West Anchorage. Posey is proud of the job they did to rebuild while he was running the muni’s Cultural and Recreational Services Department, which he refers to as the Department of FUN.

of the bank’s vice presidents decided that I should get paid for my work.” He continued that through high school and his first year at Lamar University in Beaumont, which he left to join the US Air Force. He served as a combat crewmember at the Titan II missile underground complex in Wichita, Kansas, and began taking classes at Wichita State University. After leaving the Air Force he finished his undergraduate degree, got his Juris Doctor from the law school at the University of Kansas in Lawrence, and got a job in Arco’s land department in Dallas. Posey worked on the Prudhoe Bay oil field unit agreement, but what he really wanted was to get to Alaska, where the economy was booming. “I knew that the real opportunities were in Alaska.”

Getting to Alaska A year later, Arco moved Posey to Denver. He stayed another year with the company. When it appeared that Alaska was not in the oﬃng, he quit Arco and joined Worldwide Energy Corporation,

a small company dealing in oil and gas in Canada and the United States, as well as gold claims in Alaska. Then in 1979 Arco began developing its Kuparuk River field. “They came to me and asked if I still wanted to go to Alaska and flew me and my wife Sandi up for a look. I liked the offer and we found a house. Within seven days we were back in Alaska.” The highlights of Posey’s time with Arco include helping get the Kuparuk oil field online, developing a good working relationship with the North Slope Borough, and an accomplishment he is particularly proud of—ensuring that the village of Nuiqsut, near the oil fields, got natural gas to replace expensive fuel oil. Oil was flowing from the Kuparuk field by December 31, 1981. “It was the first oil to flow in two years,” Posey recalls. “We unitized the field, got all the state and federal permits, and built a pipeline in a remarkably short time.” His work at Arco in Colorado gave Posey experience in working with lowww.akbizmag.com

BusinessPROFILE

Alaska Park LLC

Valet Airport Shuttle and Parking Service Andy Brinkman General Manager Alaska Park Valet Airport Parking

s Anchorage’s first and only valet airport parking company, Alaska Park LLC makes parking at the Ted Stevens Anchorage International Airport an experience marked by outstanding service to customers at every level. The exceptional service begins the moment customers drive their vehicle in the covered drop-off area. Friendly staff members greet them with a smile, transfer their bags to an on-demand shuttle bus and transport them directly to the airport—which is less than a mile away. When customers return to retrieve their car, they’ll find it waiting, snow-free, heated up (or cooled down in summer) and with a bottle of water on the seat. “We want to make sure things go smoothly, efficiently and safely,” said Owner’s Representative Roger McCracken.

SPEEDY, HIGH-LEVEL SERVICE IS CRUCIAL

Providing prompt, high-level service is critical to Alaska Park’s approach to doing business. Customers can leave and pick up their cars any time, as the facility is open 24 hours a day, seven days a week and 365 days a year. Their vehicles are carefully parked in individual slots inside a secure parking lot with 24-hour at-

tendants and security cameras. So customers can leave their vehicle with Alaska Park and know that it’s in good hands. “Your car is safe with us,” McCracken said. “We take responsibility for your car, so you can travel with the reassurance of knowing your vehicle will be handled with the utmost care.” Alaska Park, a wholly-owned subsidiary of Tanadgusix Corporation (TDX), gives customers the added advantage of avoiding the airport terminal traffic and parking hassles. It also allows Alaska Airlines Mileage Plan members to earn free plan miles for each day paid for parking at the regular rate. Customers can take advantage of Alaska Park’s convenient online check-in and reservation system to expedite their parking arrangements. In addition, corporate rates are available for high-volume accounts. The company’s services are ideal for frequent fliers and business travelers, particularly business women—who appreciate being able to get dropped off in a secure, well-lit area just several feet away from their heated vehicle.

FACILITY’S DISTINCTIVE DESIGN CELEBRATES AVIATION

In addition to offering premium service, Alaska Park also distinguishes –

P A I D

A D V E R T I S E M E N T

–

itself by the unique design of its building. The structure looks like a huge airplane, with the garage replicating a wing of a DC9 and the office building serving as the fuselage. The facility is currently operating on the north side of the expansive lot that it occupies off Spenard Road, and it will be fully operational by mid-summer, McCracken said. With 30 to 50 employees, Alaska Park will be enhancing its service of offerings in the near future. Ultimately, the company will offer a 3,000-squarefoot meeting room, a 2,000-squarefoot restaurant and a computer station where users can check into their flight and print out boarding passes on any flight (not just Alaska Airlines flights). With Alaska Park’s high level of service, valet airport parking is an amenity for travelers—not an afterthought. “We make sure you look forward to your next visit to Alaska Park,” McCracken said.

Dirk Whitehead, Operations Manager 5000 Spenard Road Anchorage, Alaska 99503 Phone: 907-249-4405 Fax: 907-248-3796 alaskapark.com

Private Work to Public Service In 1995, during his sixteenth year in Alaska, Arco asked Posey to move to California. “Sandy and I had become used to Alaska and we had no desire to move. I was forty-nine and decided to pack my parachute. I left Arco on January 1, 1996.” Posey knew he wouldn’t be idle for long. “We had just elected a new governor [Tony Knowles] and I knew he’d want me to do something in his administration.” That hunch was right. About four 12

Alaska Business Monthly | April 2014

cal governments, which helped when he negotiated permit terms with North Slope Borough. “In Colorado we had to go through the county to get all of our above-ground permits. We knew it was important to respect and involve the local government in our planning. It was easy for us to accept that the North Slope Borough wanted to play a part.” Posey travelled often for meetings in Barrow and Nuiqsut and built strong relationships with local people. “I often spent part of my holidays going to Nuiqust and delivering gifts of food and fruits as part of our holiday cheer,” he says. The people of Nuiqsut showed their appreciation by giving Posey gifts of their precious muktuk at the holidays. Posey said he always brought it home— and enjoyed it. On the North Slope he also met Harmon “Bud” Helmericks, a bush pilot, author, and adventurer, who had homesteaded on the Colville River delta since the early 1950s. “I was visiting Bud one day and he told me that he hated looking to the south anymore because it pained him to see all the gas being flared” at Arco’s new Alpine field. Posey thought about Helmericks’ words. He knew that Nuiqsut had long wanted gas from the nearby fields. He also knew that the Alpine field would bring oil and gas development closer to it. “When I worked at Worldwide Energy I knew that in Canada, if we had a gas well operating on a farm, the farmer got enough gas to operate his irrigation system. I wanted to extend the same idea to Nuiqsut,” Posey says. “The last thing I did before I retired from Arco in 1995 was to seal the deal to get gas to Nuiqsut. That village will have gas for the next thirty to forty years, or as long as the field operates.”

Jim Posey inside the Kincaid Chalet.

months later Knowles appointed Posey to the Alaska Public Utilities Commission (APUC), now the Regulatory Commission of Alaska. “I came on board at the time when local utilities were being privatized. And the telecommunications industry, in particular, was in tremendous growth and turmoil. “I managed the docket for the sale of the Fairbanks utilities, which included water and sewer and power and everything, and also the docket for the sale of Anchorage Telephone Utility [ATU] to Alaska Communications Systems [ACS],” he says. Mark Foster, Anchorage School District CFO and a former APUC commissioner, is familiar with Posey’s work at APUC. “I watched Jim work. He listened very carefully and thoughtfully to the arguments and evidence and came up with a fair disposition.” What impressed Foster most was Posey’s evenhanded and thorough evaluation of the different arguments presented to the commission, especially during the contentious privatization of telecommunications. “Jim had to deal with some challenging balancing acts in telecommunications, such as who was responsible for what cost, which arose with AT&T, GCI, and ACS. The arguments got heated, and the cases became complicated, but he worked his way through them. He was able to discern the solid evidence from the lighter evidence that was of-

fered up,” Foster says. Posey says he was satisfied with the privatization effort overall, but feels that the Municipality of Anchorage waited too long to sell ATU to ACS and ended up with less money. “But in the end it worked out and the city got a good enough deal,” he says. After ending his APUC term in 1999, Posey took a hiatus from public service and turned his attention to another pressing matter—his children’s education. “We homeschooled all our kids because when my daughter was at elementary school in Bayshore Elementary we didn’t like the lack of decorum and family values or the presence of drugs,” he says. Dissatisfied with public schools, the Poseys became involved with the formation and operation of the Family Partnership Home School, a home school support charter school within the Anchorage School District. But in the late 1990s the school’s enrollment, which had reached nearly eight hundred, plunged to about half when the school district forbade children from religious schools from participating in its programs. “I was on the school’s board and took a year off to help rebuild it. It was our school and our kids were still in it.” The effort succeeded; the school is still in operation. Having accomplished that, Posey began thirteen years at the Municipality of Anchorage in two jobs that he calls the “most fun” of his career. www.akbizmag.com

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After George Wuerch became mayor in 2000, he asked Posey to run ML&P, but Posey’s term at APUC placed a restriction on working for a utility. “Wuerch then appointed me to run the Department of FUN, which is what I called the Cultural and Recreational Services Department because it had all the fun things attached to it—parks, libraries, swimming pools, the convention center, and the museum,” Posey says.

Energizing Anchorage When the APUC restriction ended in 2003, Posey became ML&P’s general manager. His tenure at ML&P is notable for significant achievements— energy conservation, rebuilding, and modernizing the utility. A utility’s major assets generally have a twenty-five- to thirty-year life and need replacing after that. Soon after taking over, Posey set to modernizing ML&P. Dan Helmick, former regulatory affairs manager at ML&P, complimented Posey’s approach. “For Jim, the modernizing was both about replacing the old equipment and also making sure that his customers wouldn’t have to pay higher costs than absolutely necessary because of those changes,” Helmick says. An important measure of Posey’s success is that ML&P provided its customers with continuous service 99.99 percent of the time during his ten years. Posey, too, is pleased with the changes at the utility. “We accomplished our goals. We made all our substations modern and cleaner and removed nearly all the PCBs [polychlorinated biphenyls] from our systems. Our new generation equipment is 90 percent cleaner in air emissions and 30 to 40 percent more efficient in fuel usage.” The fuel eﬃciency translates into use of less natural gas to generate a kilowatt of electricity. Another accomplishment for Posey was the successful management of ML&P’s ownership share in the Beluga gas field. In the mid-1990s Shell was pulling out of Alaska and selling its assets, including its one-third share of the Beluga field. Rick Mystrom, then Anchorage’s mayor, appointed a panel that included Posey to explore the purchase of Shell’s interest in Beluga. The panel voted for the purchase, making ML&P one of the first utilities in the nation to own its own gas. “It was 14

Alaska Business Monthly | April 2014

the best investment the city has ever made. The field has produced money and benefits and paid about $128 million in fees, dividends, and taxes to the city” during his tenure, Posey says. Energy conservation was another area of interest. The utility promoted it and Posey complimented entities that adopted energy conservation either in the design of new structures or in retrofit of existing ones. The Alaska Center for the Performing Arts is a prime example, Posey says. “The center looked at its equipment, lighting, and whatever used electricity, and found ways to reduce its electricity costs by 20 percent to 25 percent.” Although Posey advocates conservation, he is not enamored with wind power and opposed ML&P’s buying power from Cook Inlet Region Inc.’s [CIRI] wind farm on Fire Island. The power is too expensive and not price competitive, he says. ML&P’s customers are in some of the city’s lower-income neighborhoods and many of them can’t afford it. Customers want wind power, Posey says, but they are not willing to buy it at the price at which it is available. “The cost differential is 100 percent. ML&P produces power for $50 to $60 per megawatt and it would cost $110 per megawatt to buy it from CIRI, according to the price it charges Chugach Electric,” he says.

Humanitarian Ways An organization’s success lies not only in good management but also in its employees, and Posey excelled at keeping his employees satisfied, says Elvi Gray-Jackson, an Anchorage Assembly member. Gray-Jackson worked for Posey for a few years at ML&P and admires his leadership qualities. “Most people at the top don’t make employees feel that they really matter. Employees who feel they are not important don’t want to do their jobs. But Jim made people want to do their job and do it well,” Gray-Jackson says.

It’s diﬃcult for people with demanding jobs to find time for community service, but Posey managed to find the balance between the two. “For about thirty of my thirty-four years here, I have been involved with nonprofits that are part of the safety net for the city,” he says. Russell Pounds, owner of Pacific Rim Media, worked with Posey on different occasions. “Jim is passionate about giving back to the community.” Pounds recalls the help Posey provided to last year’s Kids Day. That day is organized by the local nonprofit Anchorage’s Promise, which provides a school club for children. “For Kids Day last year, which drew about twenty thousand people, the students came up with an idea of handing out small cards with positive messages to help reduce bullying in schools. “Jim decided that ML&P should support that program—‘Random Texts of Kindness’—and we produced a dozen different card designs and handed them out at the event.” Posey, retired as of January 1 this year, plans to remain active both with consulting jobs and with his community service. He looks forward to polishing his cross-country skiing skills and says both he and Sandi like it here too much to think about leaving. Alaska, he says, has been awesome for him in every way—in its size, its beauty, and its opportunities. “I wouldn’t have had the chance to work on such interesting and important jobs elsewhere.”  Shehla Anjum is an Anchoragebased writer.

r is

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COMMENTARY

DOD photo

A Ground-Based Interceptor about to be emplaced in a silo, Fort Greely, Alaska.

US Relationships with Asia-Pacific Region: A confluence of imperatives for Alaska By Dr. Walter Skya and Dr. Ashok K. Roy The views and opinions expressed herein are those of the authors alone and not the University System of Alaska or the University of Alaska Fairbanks. “Luck is where preparation meets opportunity.” —Randy Pausch “Not all those who wander are lost.” —J. R. Tolkien

he threads of connections between America and Asia cross and re-cross on the loom of life at various levels. Like immigrants from Europe during the nineteenth century, immigration from Asia (especially China) transformed America in mul-

Alaska Business Monthly | April 2014

tiple ways. At that time, no one could have previsioned America’s relationship with Asia as clearly as Cassandra previsioned the fall of Troy. Most recently, nearly seventy years after the end of the Second World War, relations between Japan (the world’s third largest economy) and China (the world’s second largest economy), colored by old wounds, have seen deterioration over disputed islands in the East China Sea. This has put the United States (the world’s largest economy), because of its military alliances with Japan and South Korea, in

an unwelcome situation. Last November, China’s unilateral declaration of an Air Defense Identification Zone over a part of the East China Sea that includes the disputed islands of Senkaku and Diaoyu drew sharp US criticism and warning. The Philippines is another American treaty ally. America’s Pacific destiny also includes an ambitious trade agreement (Trans-Pacific Partnership) involving the United States, Japan, and ten other countries (but not China). In 2012-13, of the 819,644 international students who came to US univerwww.akbizmag.com

sities, the majority (64 percent) came from Asia. The top three countries sending students to the United States are China (235,597); India (96,754); and South Korea (70,627). How true is the increasing inter-connectedness of the United States with Asia!

Foreign Policy President Obama’s announcement in his first term of a major strategic reorientation in US foreign policy—the so-called “pivot” or “rebalancing” to Asia—was a clear signal to America’s Asian allies that the United States is still an Asia-Pacific power and that it would fulfill its commitments to maintaining peace and stability in the Asia Pacific region. This appears to be a wise decision. Particularly worrisome are the tensions between the People’s Republic of China and its Asian neighbors. For instance, China and Japan are locked in a bitter and emotional territorial dispute over the Diaoyu andSenkaku Islands, and China has aggrieved several Southeast Asian nations, particularly the Philippines, over its claims to islands far beyond China’s borders in the South China Sea. In the so-called 2009-2010 “year of assertiveness,” China picked fights with and irritated relations with Australia, ASEAN countries, India, Japan, the Philippines, South Korea, and Vietnam. This new foreign policy re-orientation is making Alaska’s strategic presence on the Pacific Rim increasingly important. Several reasons could be cited. First, Alaska’s role in America’s military force posture in Asia is being expanded. Although Alaska is covered under the US Northern Command, its forces based there are part of the US Pacific Command. A clear example of this expansion was Defense Secretary Hagel’s announcement that the United States will be deploying fourteen new groundbased missile interceptors at Fort Greely by 2017. Shocked by Kim Jong Un’s bellicose threats to void the armistice that ended the Korean War in 1953 and to launch a nuclear attack on the United States, all this within the context of North Korea’s rapid development of its nuclear weapons program and its intercontinental ballistic missiles to deliver them, prompted the United States to spend $1 billion to expand the nation’s www.akbizmag.com

April 2014 | Alaska Business Monthly

Alaska Business Monthly | April 2014

DOD photo

ground-based missile interceptor system to counter this nuclear threat from the unpredictable regime. In addition, the Joint Pacific Alaska Range Complex, through modernization and expansion, will become one of the few places in the world with adequate range space to provide training for large-scale, full-spectrum joint and combined operations that also accommodate increasing the means of enhancing the military’s most advanced capabilities. It is a premier training locality like few others in the world, making it a critical national and allied training asset. In 2011, for instance, more than six thousand service members from across all armed forces participated in exercise “Northern Edge,” receiving joint large scale training for quick response to crises throughout the Asia-Pacific region. What’s more, the Joint Pacific Alaska Range Complex, being strategically located within the national territorial boundaries of the United States, provides the United States with unfettered capability to train and test air, land, and sea forces for possible military operations in the Arctic. Second, the worldwide interest in Alaska’s natural resources is rising. Mining metals is one of them. But mining nowadays is not like during the Klondike Gold Rush in the 1890s when prospectors searched for gold in creeks with pans, picks, and shovels. Today gold is mined deep in the ground with state-of-the-art high-tech equipment by Asian corporations such as Sumitomo Metal Mining Pogo LLC, and mining operations are directed by managers flown-in from Asia. The mining industry is said to have spent $275 million on exploration in Alaska during 2012. Driving this exploration is the demand for metals by Asian countries such as China, Japan, and India. Japan imports more than $125 million in minerals from Alaska annually. In 2009, Sumitomo Metal Mining Co. and Sumitomo Corporation purchased full ownership of the Pogo gold mine. Japanese corporations have continued making significant investments in other mining projects across the state and so have the Chinese. In 2013, the United States lured more than $14 billion of investment from China. Also, in 2013, China’s Shuanghui purchased US pork giant Smithfield Food for $4.7 billion.

A Military Police Ofﬁcer scans for threats while patrolling the Missile Defense Complex, Fort Greely, Alaska.

Rare Earth Elements However, it is not gold mining that is now drawing the most rapt attention toward Alaska’s natural mineral resources. Rather, it is the strategic rare earth elements, also known as specialty or technology metals, which have become essential for production of the modern technological advances arising out of high-tech industries. Political instability and growing national rivalries in East Asia are now behind much of the nascent push to mine and locally process Alaska’s rare earth elements. In 2010, for example, the People’s Republic of China flexed its growing industrial power by blocking the export to Japan of crucial minerals used in high-tech manufacturing of hybrid cars, wind turbines, and guided missiles. Industry oﬃcials reported that China’s customs agency had notified Chinese corporations that they were not allowed to ship to Japan any rare earth oxides, rare earth salts, or pure rare earth metals. This move, of course, sent Japan scrambling to end its reliance on China for rare earth elements, seeking alternative suppliers worldwide. But the ban on rare earth elements exports to Japan also directly affected the United States because American companies now rely mostly on Japan for magnets and other components using those same rare earth elements. The crux of the problem is that China has bought up a near world monopoly on the production and refining of rare earth elements mined for use in high-tech equipment.

One of these rare earth minerals is dysprosium, which goes in the production of many critical technologies, including in the manufacturing of smart bombs and drones. China currently dominates the global market of dysprosium, but the discovery of dysprosium on Alaska’s Prince of Wales Island could provide the opportunity to break the Chinese monopoly. In December 2011, the United States Department of Energy published a report saying dysprosium is of strategic national importance and an element for national security. Therefore, the United States Defense Department is desperately seeking to find production of quality domestic supply of dysprosium, and with it begin to revive the American rare earths industry. The US military depends on rare earths for guided missile systems, satellites, and unmanned aerial vehicles, and NASA uses powerful rare earth metal magnets in its spacecraft. The key to China’s monopoly isn’t just about controlling an abundance of rareearth deposits, but also its expertise in processing ore into oxides and pure metal. Ucore Rare Metals, Inc., which focuses on production of heavy rare earth elements, is the company that owns the Bokan Mountain-Dotson Ridge property in Alaska. According to Ucore’s website, “the Bokan property is particularly enriched with heavy rare earth elements, including the critical elements dysprosium, terbium, and yttrium.” It also states that Bokan is the highest grade heavy rare earth deposit in the United States. www.akbizmag.com

Accordingly, the Department of Defense funded Ucore’s ore extraction research with a contract in October 2012.

Strategic Alaska Third, Alaska’s strategic location as America’s only arctic state enables it to assume a unique role in America’s national security posture and America’s desire to maintain a global order it has committed to since the end of the Second World War. As an arctic nation, the United States is a permanent member of the Arctic Council, the leading international organization for cooperation in the region, established by the eight Arctic states—United States, Russia, Canada, Finland, Iceland, Norway, Sweden, Denmark—in 1996, with wide participation from circumpolar indigenous peoples such as the Inuit. Headquartered in Tromsø, the largest city in Northern Norway, the organization sponsors major scientific research, focusing on environmental initiatives, sustainability, and development issues. The chairmanship of the council rotates among member states every two years, and it is the United States’ turn to assume this role in 2015. Non-Arctic states have expressed increased interest in the Arctic region. In 2013, twelve non-Arctic counties were granted observer status in the Arctic Council, five of which are Asian: the People’s Republic of China, Japan, the Republic of Korea, Singapore, and India. This is the first time Asian countries joined this once exclusive club, which is just one more indication of a global power shift toward Asia. Naturally, some permanent members have questioned certain new members’ motivations for joining the Arctic Council, wondering if this is just an attempt to expand their national influence into the governing structure of this critical territory. It was only in May 2013 that the United States issued its “National Strategy for the Arctic Region” report. But with the Arctic Council chairmanship belonging next to the United States, Alaska must be consulted throughout in order to work out a comprehensive circumpolar north policy, since it is the only US Arctic state. The United States has been slow in the past recognizing the threat that China’s global monopoly over the mining and production of rare earth elements poses to its national security. Now we must not 20

Alaska Business Monthly | April 2014

be slow to recognize security interests in the Arctic as we sit in the Council. It is noteworthy that India is one of the non-Arctic Asian states. While the Japanese and the Chinese have extensive trade relationships with Alaska, it might seem odd that India is involved. Interestingly, the Obama administration’s pivot to Asia includes an area that stretches in an arc all the way from the Indian Ocean—including India—to Northeast Asia. President Obama and Indian Prime Minister Manmohan Singh, in a bilateral summit held in late 2013, reflected on the transformation of United States-India relations during the past decade. Today United StatesIndian relations are stronger than at any time since the birth of the Republic of India in 1947. India and the United States have much in common. Both nations are multi-ethnic and multi-racial secular democracies and have a common language (English, along with Hindi, is an oﬃcial language in India). Anchored in common democratic values, language, and strong people-to-people ties, it is not surprising that the United States and India have developed a comprehensive global strategic partnership. India’s intellectual power has a presence in Alaska’s higher education system, too. For instance, compared to peers, there is an enviable presence of Indian faculty on the campus on the University of Alaska Fairbanks. In the College of Engineering & Mines, China-born faculty has a presence in the Department of Mechanical Engineering, while Indiaborn faculty has a big presence in the Department of Petroleum Engineering and the Department of Mining & Geological Engineering. There is even an oﬃcial sister-city connection between Fairbanks in Alaska and Pune in India. In short, along with the North America region, Asia has become the most economically dynamic region in the globe and remains vital to US national security as well as to Alaska’s prosperity. In an increasingly global world, it is imperative that our students, as future leaders in the state and nation, be cognizant of Asia’s experience in world history and its relevance in shaping the present. In this vein, the newly redirected Asian Studies Program on the campus of the University of Alaska Fairbanks is designed to provide Alaskans with a solid background in Asia-Pacific affairs, an awareness of contemporary issues affecting the region, and a robust an-

alytical tool kit capable of helping forecast future developments in Asia. Today, south Texas and North Dakota have become the largest sources of tight oil (i.e., shale oil gas). When oil prices rise, production can be ramped up quickly by drilling more holes, and when oil prices fall, the producers can simply stop drilling. This flexibility is a huge advantage. This has huge long-term implications for Alaska which depends overwhelmingly for its revenues on North Slope oil production. History shows that an economy may be rich in resources but if it is not modern, adjustments become hard when external shocks hit (Argentina is a case in point). In the haze of a new Asian dawn over the global stage, a confluence of urgent imperatives become more distinct and should give all Alaskans more pause to consider the consequences of our role as an actor.  Dr. Walter Skya is Associate Professor of History and Director of the Asian Studies Program at the University of Alaska Fairbanks. He has worked in the Tokyo Head Office of Mitsubishi Corporation. He earned his PhD at the University of Chicago. He is the author of the book “Japan’s Holy War: The Ideology of Radical _ Shinto Ultranationalism,” published by Duke University Press (2009). Dr. Ashok K. Roy is Vice President for Finance & Administration/ CFO of the University System of Alaska and Associate Professor of Business Administration at the University of Alaska Fairbanks. He holds six university degrees and five professional certifications. Dr. Roy has also authored over seventy-six publications in trade and academic journals including chapters in two encyclopedias. www.akbizmag.com

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ENTREPRENEURS

Path to Prosperity: Extract, Then Add Value A unique contest in Southeast Alaska rewards innovation

credit here

By Dustin Solberg

The ﬁrst winners of Path to Prosperity’s contest for Southeast entrepreneurs, from left, Steve Helgeson, Kevin Skeek, Sue Tyler, and Wes Tyler.

hen Steve Helgeson sees a big Sitka spruce, he sees guitars. Lots of them. Or more precisely, he sees perfect soundboards— the blonde, straight-grained panels from which most of the world’s guitars are built. Helgeson is a boat builder who loves to play guitar. Some years ago, he began experimenting and built his first guitar. What he discovered is that making the curved lines of a guitar isn’t all that different from building boats, so he built a few more. “The idea of heating wood to soften it and bend it around a frame is the same thing you would do with a boat,” he says. The coastal town of Wrangell, Alaska, where Helgeson has built and repaired fishing boats for years, is a small grid of streets and houses carved from a lush rainforest where trees grow big. Sawmills have had a big part the town’s history.

Alaska Business Monthly | April 2014

“It wasn’t lost on me, living in Wrangell, that we’re here right in the heart of the Tongass forest where some of the finest soundboard material in the world grows,” he says. In the timber business, a tree destined to become soundboards for cellos, pianos, or guitars earns a distinct title: musicwood. As the years ensued, Helgeson went about running his wood shop and raising a family, but he continued to watch as musicwood logs were cut in the forest and shipped off to distant factories in Japan and the Lower 48. And it led him to wonder.

The $110,000 Guitar Kevin Skeek grew up in the village of Hoonah, a day’s ferry ride north of Wrangell. When he was in his twenties and working as an intern at Sealaska Corporation, the major private forestland owner in Southeast Alaska, he joined his superiors

on what for him was a rather plum assignment to meet guitar company execs at an event in southern California. “I was playing guitar by then. I had an absolute passion for guitar,” he says. “When I was there, I was holding a guitar that was worth $110,000.” It was the most beautiful instrument Skeek had ever seen—and its spruce soundboard had come from a Sealaska forest. It was built by the famed C.F. Martin and Co. of Pennsylvania. “And they were explaining to us how they had used our Sitka spruce for their tops. And that just blew me away. It was then that I realized I wanted to get into the guitar building business. “Right then and there I said, ‘Why aren’t we doing this?’”

A Contest for Entrepreneurs Business ideas are not uncommon, but the good ones are. And both Helgeson www.akbizmag.com

Far Left: Steve Helgeson crafting a guitar. Left: Kevin Skeek playing a guitar. credit here

and Skeek knew that turning an idea into something more, with a storefront, a URL, and a cash flow, is an uphill climb. “The idea of a guitar building business was really a dream,” Helgeson says. “But you know how dreams are. If you’re a busy person like most people are, you have a place somewhere behind your everyday responsibilities and obligations where you stick dreams and it’s kind of where they stay.” Skeek’s “aha” moment at the California guitar expo hadn’t gone anywhere either. Despite his zeal, his idea had languished largely forgotten for seven years. Then, in 2013, came a new entrepreneurial contest promising prizes of $40,000 for two winning start-up businesses. The contest was looking for entries from people like Helgeson and Skeek. Called Path to Prosperity, it was open to aspiring entrepreneurs who live in Southeast Alaska and who are committed to a “triple bottom line” approach to business. In short, it’s a business model in which profits matter, but paying attention to measures of how a business affects people and the planet are equally valuable. Haa Aaní, a Sealaska subsidiary, and The Nature Conservancy, a conservation group with a strong Southeast Alaska presence, sponsor the Path to Prosperity contest. Helgeson was in. He drafted a business plan, working early in the mornwww.akbizmag.com

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April 2014 | Alaska Business Monthly

In Brief: Path to Prosperity

he Path to Prosperity CompetiOther boot camp topics include: tion aims to support business ■ Financial advising and cash fl ow ideas in Southeast Alaska that management will increase local employment, have a ■ Marketing positive social and economic impact on ■ Human resources their communities, and promote con■ Title and escrow servation. ■ Sustainability in business In 2013, the program’s fi rst year, its ■ Commercial lending call for entries drew fi fty-nine applicants. Of those, twelve were named semi-fi nalPath to Prosperity is a program of ists and participated in a three-day en- Haa Aaní and The Nature Conservancy. trepreneur boot camp in Juneau featur- Haa Aaní LLC is a wholly owned subsiding a range of business experts. iary of Sealaska Corporation dedicated to improving the economic conditions in Southeast Alaska communities through innovation, sustainability, and collaboration. It aims to expand the regional economy and foster new and sustainable in2014 Path to Prosperity dustries within rural communities. Competition The Nature Conservancy is a conCall for Entries—March servation organization with a strong Informational webinar—April 8 presence in Southeast Alaska. Path to Deadline for entries—May 30 Prosperity is one creative way in which Entrepreneur boot camp for semiit pursues its mission of conserving the fi nalists—August 31-September 3 lands and waters on which all life deAnnouncement of two $40,000 pends. It accomplishes this mission by winners—January 29, 2015 protecting and restoring nature; providMore details at p2pweb.org ing better ways to use nature; and bringThe contest awards two prizes of ing people together for a healthy planet. The project has been well received $40,000 in business start-up services to the eventual winners, but contest by those participating. One boot camp organizers stress that everyone who participant, in an unsigned handwritparticipates receives some benefi t. For ten note to the competition organizers, the twelve semi-fi nalists, the entre- wrote, “Thank you so much for dopreneur boot camp offers an intensive ing this. The incredible effort that has gone into this on your part is obvious session in writing business plans. Visiting instructors at the fi rst boot and this has been a magnifi cent expericamp included entrepreneurs who of- ence. With or without the fi nal award, fered a fi rst-person perspective on we have been privileged to enjoy a verlaunching a new business. Representa- itable fortune of information.” tives from University of Alaska Southeast; Wells Fargo Bank; Bainbridge Graduate Institute; Longenbaugh Law Firm; Simpson, Tillinghast, Sorenson and Sheehan; Alaska Small Business Development Center; Central Council Tlingit and Haida Indian Tribes of Alaska; and Merrill Lynch Investments also participated. ing between the hours of four to seven before he went off to work. Upon learning of the contest, Skeek recalls thinking, “This is my chance.” He spent hours at his laptop at his home in Hoonah, finally putting his 24

Alaska Business Monthly | April 2014

long-held dream down on paper in exquisite detail for the first time. But the final detail—what to name his guitar venture?—remained elusive. “Because I am Alaska Native I wanted something that was culturally signifi-

cant but yet a broad enough statement,” Skeek says. Then, one day, in a moment of near exasperation, he leaned back in his chair, letting his eyes wander from his computer screen to the window and the forest outside. At that moment, a raven flew into view and perched in a tree. “Oh my gosh,” Skeek recalls saying at the time. “That’s it.” With that, an identity was born: “I called it Raven Guitars,” he says. “It’s a very smart bird, and it’s so marketable, too. Anything from acoustic guitar for country players all the way to, let’s say, your most heavy metal hardcore rocker that has makeup on and everything. It suits them, too.”

Two Guitar Builders Meet The two guitar builders were among the contest’s fift y-nine entrants. When the twelve finalists were announced in the fall of 2013, both Skeek and Helgeson made the cut. They were both surprised to see that their own guitar concept wasn’t the only one on the list. “I’ve got to say, at first I was kind of hesitant. I really was,” Skeek says. Helgeson says, “My first reaction was to be a little bit disappointed and quite frankly a little bit annoyed.” Then something happened when they finally met at the Path to Prosperity entrepreneur boot camp, held at a Juneau hotel conference center. “After we talked, we realized we had the same vision,” Skeek says. “Instead of being competitors, we decided: ‘Let’s try to win this thing.’ It’s quite a fairy tale, if you ask me.” “And it was also clear that we were both passionate about natural resource utilization and sustainability,” Helgeson says. “And also community and social sustainability. For us those two elements are just as important as our interest in guitar building. We’re both from small rural communities that have seen real economic difficulty. And so it matters to us that our families can have good jobs.” So it was decided. They would build guitars in Helgeson’s Wrangell workshop overlooking the blue waters of Zimovia Strait, and they would call themselves Raven Guitars. The merger worked. At the Juneau Innovation Summit in January, they were introduced as winners of a $40,000 prize. www.akbizmag.com

How a Cabin Company Captures More Value Sue and Wes Tyler’s Alaska Legacy Wood Homes and Products won the other $40,000 prize. The Tylers also own Icy Straits Lumber, a sawmill with a devoted customer base that has grown through word-of-mouth since they bought the mill ten years ago. The cost of doing business has changed since they bought the mill. The biggest hurdle? The rise in energy prices while operating in Hoonah, a remote community accessed only by boat or plane. “It just changed everything,” Sue Tyler says. “We’ve been trying to think of what can we do to make the business more profitable and be able to handle that increase in fuel. It increases all the costs.” From the start, Icy Straits Lumber was a value-added business. They had made their mark not by turning out big volumes of 2 x 4s, but by finding the best use for their logs—their products include posts and beams, tongue-and-groove paneling and flooring, and molding and trim. A logical next step for their business was creating more finished products. “We want to change our image. We aren’t just a lumber company,” Sue Tyler says. “We want to focus more on the home packages and the cabin packages and the elements those packages are comprised of.” The reason for their new value-added venture is simple. “People in these remote communities need jobs to support their families and way of life while adding value to a local natural resource,” Sue Tyler says. “That’s the motive behind the whole operation.” Their new start-up is called Alaska Legacy Homes and Products, and its early support from Path to Prosperity has been crucial. “This is exactly what we need. What we need is that technical support from someone who can say ‘Hey, I’ve been there and I’ve done that,’ and help lead us in the right direction,” she says. “It’s one of these things where you don’t know where to start. Who can I call who would care?” Conservation and Long-Term Jobs These two entrepreneurial ventures were inspired by a simple question: How to capture more value from a renewable natural resource that surrounds the rural communities of Southeast Alaska? www.akbizmag.com

“If you innovate to extract as much value from those natural resources as you possibly can, you will create enough value to support your community’s economy,” says Mike Skinner of the Bainbridge Graduate Institute, who has consulted with Path to Prosperity. “Having said all that, there certainly are challenges: the cost of energy, the logistics of getting products in and out. I don’t mean to underestimate those. But if you are smart about business, there are things [in Southeast Alaska] that can be done forever, where everyone can enjoy some level of well-being forever.” This is what inspired the Path to Prosperity contestants. “I still believe wood manufacturing is a viable industry in these little communities on a small scale,” Helgeson says. In simple terms, if Raven Guitars matures to a point where it can build one thousand guitars a year, then they’re actually consuming two thousand to three thousand board feet of select musicwood a year to build guitars that may wholesale for $3,500 each. “One good tree could have a thousand guitars in it. That’s the magnitude of value capture we’re talking about here.” Path to Prosperity founders say they launched their contest to inspire ventures to create jobs and businesses in rural Southeast Alaska communities. “At The Nature Conservancy, we believe that entrepreneurs can help lead a community by demonstrating how local natural resources can be used with an eye to the future,” says Norman Cohen, who directs Southeast Alaska programs for The Nature Conservancy. “This is why we founded Path to Prosperity: The future of the region’s rural communities lies in the sustainable use of natural resources.” Can Path to Prosperity shape the future of communities in Southeast Alaska? Haa Aaní CEO Russell Dick believes so. “This business development competition was created with a common belief that a healthy community with strong social and cultural infrastructure is the result of innovative entrepreneurship,” Dick says. “This competition can be a catalyst and support network for developing successful entrepreneurs.”  Writer Dustin Solberg manages communications for The Nature Conservancy in Alaska.

THANK YOU!!

Together, we raised $40,000 for The Children ’s Lunchbox and kpb architects sponsored a $9,000 student paper garment competition scholarship in November 2013. We thank our supportive and generous friends in the community for contributing. Sponsors Think Office Neeser Construction Inc. Conoco Phillips Alaska Airlines Arctic Lights Electric, Inc. EBSC Engineering Exterior Technology Systems GCI Pfeffer Development Davis Construction Kevin Smith Photography The Anchorage Museum The Bicycle Shop

Alaska Architectural Lighting, Alaska USA Insurance Brokers, BINW, Capital Office, Criterion General, HMS, Dennis Turnbull Inc., Don Myric, Jernstrom Engineers, Kevin Meyer, MCN Construction, Northwest Landscape Rain Proof Roofing, RSA Engineering, Inc. Tandus, Valerie Whitmore, Nancy Pollock, Wilson Agency, DOWL HKM, Coffman Engineers, Jeff Thon, Patrick Rumley, Kurt Hulteen, Professional Growth Systems. AAK, Soda Jerks, Alaska Tab & Bind, Allen & Peterson, Allure, Anchorage Symphony Orchestra, Avis Rent A Car, Bears Tooth, Blush, Bruce Johnson, Capital Office Circular, Cor Cosmetics, Crush, Escape Salon Spa, Eye Styles, Great Harvest Bread Company, Her Tern, Hotel Captain Cook, ID Project, Linda Gierczak, Mabel Mckinley, Martin Buser, Mayah ’s, Mooses Tooth, Orso, Senator Mark Begich, Sevigny Studio, Shuzy Q, Sis ’s Café & Catering, Skinny Raven Sports, Snow City Café, Spenard Builders Supply, Urban Greens, VF Grace, 3form, Rod Shipley, The Bicycle Shop, Apex Live Sound Reinforcement, DJ Spencer Lee, Artique LLC, Davis Constructors and Engineering.

Artists

Megan O ’brien Mary Wilts Alvin Amason Shoko Takahashi Kathy Kaulitz Linda Lyons Margret Hugi-Lewis

Chris Selin Drew Michael Sarah Davies Linda Lucky Garry Kaulitz Apayo Moore

Supporters Frank Hauser Lisa Sauder Ashley Munson Sarah Wooley Paige Petr

Mary Wilts Rod Young Rosie Morgan Marie Conover

We would like to thank The Children ’s Lunchbox and the Anchorage School District for their cooperation and support in making pupil+paper possible.

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April 2014 | Alaska Business Monthly

FINANCIAL SERVICES

More Alaska Business Owners Selling their Companies for Retirement By Tracy Barbour

ore Alaska business owners are selling their companies as part of their retirement planning, mirroring a trend that’s taking place nationwide. Business experts in Alaska say the trend is being fueled, in large part, by aging baby boomers who are preparing for their “golden” years. Alaska’s baby boomers are starting to downsize as they move into the next phase of their lives. In the process, it’s only logical that they step away from the businesses they began decades ago, says Bob Poe, a term assistant professor with University of Alaska Anchorage’s College of Business and Public Policy and previous president and CEO of the Anchorage Economic Development Corporation. Many boomers came to Alaska to build their future. Now it’s thirty something years later, and they’re spinning off their enterprises to the next generation of Alaskans—folks who were born and raised in the state. It’s a great opportunity to acquire an established Alaska business. But relationships run deep when it comes to doing business in Alaska, Poe says. In many cases, retiring owners are selling to their partners, managers, and key employees, as well as to third parties. Increasingly, Alaska Native corporations are becoming more active in the purchase of existing enterprises. For instance, Nana Regional Corporation, Koniag, Inc., and Calista Corporation have acquired a number of successful Alaska businesses, which, in turn, is having a positive impact on Alaska as a whole. “The real success of Alaska and Alaska Native Corporations is the next generation that we grew here,” Poe says. “Native corporations are educating them [shareholders] through scholarships… Not only are the boomers selling a company, but there’s somebody on the other side buying it that has a real view for the future.”

Resource Businesses and Dental Practices Transferring Ownership Businesses with longevity beyond the individual owners are the ones that are most often being sold by retiring owners. In Alaska, that typically equates to oil and gas, engineering, and resource and extraction businesses. “That’s Exit planning where I see Alaska Native corporations buying businesses,” steps for business owners Poe says. “They used to focus more on government conrecomended by Wells Fargo Private Bank. tracting, but now they’re trying to diversify.” 26

Alaska Business Monthly | April 2014

www.akbizmag.com

Photo courtesy of Denali Capital Management

Photo courtesy of UAA

Photo courtesy of Wells Fargo

TerriLee Bartlett ChFC, Wealth Advisor Wells Fargo Private Bank

Jave Ragan Senior Wealth Planning Strategist Wells Fargo

Such diversification makes sense, given the nature of Alaska and Alaska Native corporations. “We’re a resource extraction state, and they own millions of acres of land,” Poe says. TerriLee Bartlett, ChFC, a wealth advisor with Wells Fargo Private Bank’s Anchorage office, has also noticed that more Alaskans are selling their business as part of their retirement planning. “We see quite a bit of that, normally

Robert Poe Jr. Term Assistant Professor UAA’s College of Business and Public Policy

coming from the construction and oil service-related companies,” she says. Baby boomers in their fifties and sixties are at the center of the trend, some selling for large sums of money to Alaska Native corporations and other cashrich buyers. Word is getting around, and boomers are often induced by the potential of a lucrative sale. “Business owners are thinking: ‘I may as well take advantage of this opportunity now, in-

Brian Durrell President and Owner Durrell Law Group P.C.

stead of later,’” Bartlett says. “Often, it’s a larger company purchasing a smaller business in the same industry.” Brian Durrell, JD, CPA, founder of Durrell Law Group PC, also considers Alaska’s aging population to be a key driver of many business sales. His five-attorney, Anchorage firm focuses on business, estate, and tax planning, including sale and gift transactions involving closely/family-held businesses.

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April 2014 | Alaska Business Monthly

them on to an employee agreement for a year or two. Not surprisingly, the stay of the outgoing owner often ends up being shorter, as the new owners are eager to complete the transition and imple—TerriLee Bartlett ment their own agenda. ChFC, Wealth Advisor Although third party sales are typiWells Fargo Private Bank cally cash deals, sometimes retiring owners will end up with a promissory ing them to control and benefit from note for some or all of the proceeds the business, including making deci- of the sale. This allows them to get a sions over the company’s professional steady stream of income from the loan management team. If the business own- payments for the term of the note. ership is placed in a GST (generation Regardless of the structure of a third skipping transfer) tax exempt trust, the party sale, there are steps owners can assets held in the trust can transfer free take to “dress up” the business before it is of estate and gift taxes from generation marketed for sale, Durrell says. This into generation. cludes properly assuring a strong finanOften, owners don’t have the option cial reporting system, proper handling of of being able to keep their business inventory, cleaning up delinquent receivwithin the family. Sometimes there’s ables, and making sure the corporate resimply no one available to take the cords are in order. “It’s a matter of thinkhelm, according to Jave Ragan, a Se- ing in advance about what a prospective attle-based Wells Fargo senior wealth buyer will want to review during the due planning strategist who works exten- diligence process, and then making sure sively with clients in Alaska. “As you everything is in order,” he says. move through the generations, it beSelling to Key Employees comes more difficult to pass it along,” he says. “Maybe the next generation A management group can be a desirable doesn’t want to stick around and grind potential buyer for a retiring business it out. For them, it’s a lifestyle choice.” owner. But financing can be an issue. However, a major challenge is that the Selling to a Third Party management group may not be coming Only about 25 percent of transition- to the table with excess cash to contribing businesses go to family members, ute to the deal, Ragan says. The differRagan says. The rest get sold to an in- ence between what the group can bordependent third party or management row from the bank and the company’s group. Larger companies, in particular, value will have to be made up by the are typically sold to outside parties. seller carrying the note or by the seller There are two primary types of outside taking a cut on the price. buyers: financial (private equity firms) Business owners typically don’t earn and strategic (those in the same or a top dollar when selling to employees, similar industry). In Alaska, a private but that’s not their primary motivation equity firm might likely be an Alaska with this type of sale. Many times, the Native corporation. seller is willing to take a cut on the price Most owners prefer a full cash-out to recognize and reward employees for transaction when selling to an outside their hard work over the years. company. However, the transaction Bartlett says selling a business to can be structured any number of ways. long-time employees for less than it’s For example, private equity firms typi- worth isn’t a farfetched idea when cally purchase controlling interest of you consider the seller’s relationship the company and allow the owner to and emotional connection with them. sell back the remaining interest over a “Business owners are often very loyal to certain period of time. “In a lot of those their employees,” she says. “They care instances, it is required that the owner about what happens to them. Often stay on so the buyer can harvest their they want to integrate employees into intellectual knowledge,” Ragan says. the sale and help protect their jobs.” Much of the time buyers may cash An employee stock ownership plan out the sellers completely, but sign (ESOP) can also be a viable alternative.

“Business owners are often very loyal to their employees. They care about what happens to them. Often they want to integrate employees into the sale and help protect their jobs.”

But a few years ago, the selling-forretirement trend was connected to tax consequences, Durrell says. The tax environment was a major factor for the sale of a significant number of Alaska businesses at the end of 2012—when the Bush tax cuts were scheduled to expire and the capital gains rate was scheduled to increase. “The last half of 2012 was absolutely manic with the sale of businesses,” Durrell says. “For instance, we had no fewer than six dentists who called for help selling their practices in late 2012.” Durrell, who has handled hundreds of projects involving business transfers over the past thirty-plus years, sees companies change ownership in three main ways: transfers to family members, transfers to key employees, and third-party sales.

Keeping It in the Family If a company is family-owned, the retiring owner generally first considers a transfer of the business to a family member. This triggers gift tax considerations and integration with the business owner’s overall estate plan. It creates interesting estate planning issues if some children are involved in the business and others are not. For smaller businesses, this generally is not an option if owners don’t have any children who are involved in or want to run the company. However, if the company is large enough, it can hire professional management, so the children won’t need to actively engage in the business. “If the business is large enough to be able to hire professional management, usually the transfer of the business ownership will be to perpetual trusts that will pass the business from one generation to the next free of gift and estate tax, rather than being transferred directly to the children,” Durrell says. However, the owners can designate their children as trustees of the trusts that hold the business interests, allow28

Alaska Business Monthly | April 2014

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Shares are allocated to employees and may be held in an ESOP trust until the employee retires or leaves the company. The shares are then sold. “It can offer enormous tax advantages in terms of deferring the taxation, and it can be a great equity builder for the new owners,” Bartlett says. When selling to cash-strapped key employees, owners often transfer their business for future profits, according to Durrell. The most basic way to structure the deal would be a sale of the corporate stock or LLC membership interest in exchange for a promissory note for the purchase price secured by the business interest. “It’s more of an indirect payment of profits, contingent on the key employee’s success in running the business,” he says. “It’s not the most tax-advantaged way to do it because the purchase price is not deductible.” A more tax-efficient way to transfer a business to a key employee would be for the retiring owners to transfer ownership interest to them through annual stock bonuses. The employees would have to pay taxes on the bonuses; however, the company would receive an

equivalent tax deduction. When entering into a buy-sell agreement with a key employee, it is important to address unforeseen contingencies during the transition period. The stock bonuses generally would be subject to a vesting schedule to provide “golden handcuffs” that reduce the risk of the key employee leaving prior to completing the business transfer process. “Advanced planning is critically important to be able to have tax efficiency with the transfer of a business to a key employee,” Durrell says. “It usually takes a three- to five-year time frame to complete the ownership transition from the owner to the key employees.”

Start Planning Early Selling a business can be a very tax driven event, Durrell says. Tax consequences have a major impact on when and how owners choose to sell or transfer their businesses. For example, when transferring a business to a family member, gift taxes generally come into play. However, each parent currently can give away a $14,000 gift tax-free to each child each year, which can allow

tax-free transfer of business interests with a significant value when the gifts are spread over several years, especially when minority interest valuation discounts are taken into account in valuing the gifts. Durrell’s general advice is: start planning early—no less than five years before you retire. He encourages retiring owners to seek professional advice about the business and tax aspects of selling, as well as their own personal estate and financial planning for retirement. Bartlett agrees. Selling a business is normally a once-in-a-lifetime event, and business owners need to be as thorough as they can about the entire process, she says. “We try to gear them to contact us early in the game, so that we can start talking to them about options, evaluations, and their retirement plans,” Bartlett adds. “Then we can set up a road map for how they will plan their exit, and what will happen after the sale.”  Former Alaskan Tracy Barber writes from Tennessee.

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April 2014 | Alaska Business Monthly

HEALTH & MEDICINE

Photo courtesy of Alaska Clean Seas

A comprehensive ﬂeet of more than ninety special purpose vessels are response ready to support Alaska Clean Seas member companies’ North Slope activities.

Oil Spill Response Organizations: Always Ready Constant training and diligence in industrial accident prevention and response By Vanessa Orr

or more than twenty years, owners or operators of oil and gas related vessels and facilities that pose a serious threat to the environment have been required by the federal Oil Pollution Act to prepare their own facility response plans. This requirement led to the creation of Oil Spill Response Organizations, or OSROs, a small yet vital part of the Alaska oil and gas industry. “Because of Alaska’s geographic size and lack of infrastructure in remote ar30

Alaska Business Monthly | April 2014

eas of the state, the cost to meet full OPA 90 [Oil Pollution Act] compliance grew to an unreasonable amount,” explains Matt Melton, general manager, Alaska Chadux Corporation. “One analysis estimated the expense at $100 million. “When the tanker and tank barge owners realized the cost for compliance and what that would mean to the people who live in remote areas of Alaska, a few of them got together and worked with the US Coast Guard to create an Alternative Plan-

ning Criteria [APC],” he continues. “To manage this plan for western Alaska, the Alaska Chadux Corporation was formed.” Alaska Chadux Corporation, along with Alaska Clean Seas and CISPRI (Cook Inlet Spill Prevention and Response, Inc.) are member-funded, not-for-profit organizations established to provide oil spill prevention and response for their member organizations, which include companies that explore, produce, or transport oil. “Our mission of being ready to www.akbizmag.com

protect Alaska’s environment in a safe, efficient, and cost-effective manner helps keep costs low to our members,” says Melton. “With the cost of compliance so high, we help to take the burden off. “If these companies had to pay for full compliance, it would greatly affect the price to the consumer in remote Alaska,” he adds. “You hear about the high cost of fuel in these remote areas now; if it wasn’t for the APC and a nonprofit like Alaska Chadux keeping the costs down, the increase in price to the end user would be considerable.”

Alaska Clean Seas personnel and equipment are frequently put to the test in order to ensure the highest levels of readiness. Photo courtesy of Alaska Clean Seas

Prevention and Training When an oil spill happens, it needs to be contained as quickly as possible, which requires well-trained responders. To this end, Alaska OSROs provide a lot of training, both to their members and to those working in the field. Alaska Clean Seas, for example, which serves the North Slope and the first 167 miles of the trans-Alaska oil pipeline, provides Arctic-oriented spill response training to its member companies, contractors, village response teams, and government agencies. In 2012, Alaska Clean Seas provided more than 648 classes on topics including in-situ burning, broken and solid ice response, wildlife protection, incident management, and safety and health response issues. “Member companies may sign a mutual aid agreement so that if there is a big spill and they need help, they can look to other member companies for support. To this end, we provide weekly training on our equipment to North Slope workers in a wide range of professions, including roustabouts, housecleaners, cooks, etc. so that they are ready to respond,” explains C. Barkley Lloyd, president and general manager, Alaska Clean Seas. As a result of this training, a minimum of 115 qualified response personnel are immediately available on a daily basis to participating member companies. More than 600 trained personnel from private contractors and Alaska Clean Seastrained North Slope Village Response Teams are also available for use. The organization also manages an industry-sponsored spill responder internship program focused on local North Slope Alaska Native high school graduates. According to Lloyd, a number of the interns who have completed the two-year program have gone on to www.akbizmag.com

April 2014 | Alaska Business Monthly

Photo courtesy of Alaska Clean Seas

Training is conducted year-round on Alaska Clean Seas response tactics and equipment for volunteer responders on the North Slope Spill Response Team, Auxiliary Contractor Response Team, and members of the local Village Response Team.

be hired by Alaska Clean Seas and other oil field companies. Alaska Chadux Company also provides a good deal of training for its members, including initial training of staff at member facilities and quality control training. “We’ll walk through the facilities with a company’s emergency response team to look for issues, and we’ll discuss spills that have happened so that they can learn from others’ mistakes,” says Melton. “We also provide some ICS training, health and safety training, wildlife hazing, and cold water survival training.”

CISPRI’s eleven spill technicians train weekly on various tactics for cleaning spills on water, inland, and near shore and also spend a lot of time training with the Short Notice Response Team, made up of members from local oilfield contractors. “We also have contracts in place with seventy vessel owners and provide training to those operators and their crews,” says Todd Paxton, general manager, CISPRI. CISPRI also has a test tank at its Nikiski facility, where technicians test and train the effectiveness of skimmers and validate skimmer recovery rates. “We also use the

test tank to develop and test new tools and procedures and refine them to be functional in the field,” says Paxton. “The tank enables us to train in real oil; we spend a lot of time deploying gear in open water situations, but we can’t put hydrocarbons in the water to practice.” Paxton adds that the test tank is also available to other oil spill organizations for training.

24/7 Response One of the advantages of OSROs is that they have the equipment and manpower needed to respond immediately to oil

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spills. While most of their work is done within Alaska waters, they occasionally travel Outside to help in emergency situations. “While our primary area of interest is the North Slope, we do respond to spills elsewhere,” says Lloyd. “Alaska Clean Seas has provided expertise and equipment to the Macondo Spill in the Gulf of Mexico and provided training in Maine, Russia, Singapore, and England. “There isn’t a lot of Arctic expertise in these areas,” he adds. “Cleaning up an oil spill when it’s seventy degrees below is more challenging than when it’s thirty degrees above.” Alaska Clean Seas has ninety-three employees and $95 million of specialized equipment at the ready, including more than sixty-one miles of oil containment boom; 160 skimmers; eight helitorch aerial ignition systems; ninety-six vessels; two 128 barrel and twelve 249 barrel mini-barges; various sizes of storage tanks and bladders; and wildlife hazing and stabilization equipment. Because animal issues are such a concern on the North Slope, Alaska Clean Seas works closely with the Alaska Zoo

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Photo courtesy of Alaska Chadux Corporation

Chadux Responder landing craft at site of F/V Fate Hunter grounding.

and Alaska SeaLife Center and a number of federal and state agencies and private organizations to deal with matters ranging from hazing ravens to prevent them from building nests on oil platforms to capturing orphaned polar bear cubs. “A few years ago, we were notified of a baby polar bear on a pad, and we called the zoo for advice and notified appropriate regulatory agencies. It was still there days later, crying, so it was clear that the mother wasn’t coming back. We were directed to attempt a capture,” says Lloyd.

“We had big polar bear cages and traps, but nothing that would work for a cub. Zoo personnel suggested using a Rubbermaid trash can, and while someone distracted the cub from the front, a person wearing heavy gloves picked him up from behind and put him in the can. Zoo personnel arrived with heavy cream and fish oil in a bottle, and now he’s a star attraction at the St. Louis Zoo. “Orphan musk oxen are a lot easier,” he adds. “They’ll nibble dog food right into a kennel.”

April 2014 | Alaska Business Monthly

Photo courtesy of Alaska Chadux Corporation

Chadux Responder landing craft during an exercise in Prince William Sound.

As a member of the Marine Mammal Response Working Group, Alaska Clean Seas is also involved with learning to triage and clean animals that could potentially be affected by oil spills. “The zoo recently called us when they were doing dental work on a polar bear,” says Lloyd. “While the bear was sedated, they let the group pour mineral oil on the other end to test different ways to clean the oil off.”

Always Ready Alaska Chadux Corporation, which covers members from the North Slope to Adak and down to Cordova, has workers at Point Thomson, Barrow, Prudhoe Bay, and in western Alaska at four equipment hubs. “We have one of our managers on call seven days a week, as well as a twenty-four-hour answering service,” says Melton. “We try to get on scene within twenty-four hours, weather depending. We have contracts with aircraft and vessels throughout Alaska, as well as have our own smaller vessels, including a forty-two-foot vessel in Whittier that we can bus on a trailer. “Though we’re headquartered in An34

Alaska Business Monthly | April 2014

chorage, we have equipment strategically placed throughout the state, most in flyaway packages,” he adds. “We can break it down to put on smaller planes up to a C-130.” Chadux responds to spills both at sea and on land. “Last year was pretty busy; at one point, we had five responses going at once,” says Melton. “A lot of those companies must have had OSROs listed in their contingency plans, and there are only a few of us in the state. “Some companies have their own equipment and can do the initial response, but they call us to come in and run it,” he adds. “They’re pulling their line managers and support tech away from their day-to-day jobs and they need to get them back in the line as quickly as they can. We can focus on clean-up.” Chadux responds to both member and non-member emergencies. The company was called to respond when the fishing vessel Lone Star sunk this past summer in the Igushik River near Dillingham and also responded in 2004 when a bad storm in the Bering Sea caused the M/V Selandang Ayu to run aground in Unalaska and split in half,

spilling 350,000 gallons of bunker oil and diesel into the water. “That was a major event in Alaska and changed the way we do things in the state,” says Melton, adding that waves had pushed oil thirty feet up onto walls in the bay where the ship grounded. CISPRI also has a twenty-four-hour emergency phone line, though the majority of their calls tend to be notifications and not activations. “A member company will call us about a potential problem; for example, if they broke a hydraulic hose and spilled a small, unrecoverable amount into the Inlet,” says Paxton. “Knock on wood, we’ve fortunately not had many accidents; in the six years I’ve been here, we’ve had no on-water responses and just a few facility-related responses, most of which were minor in nature.” CISPRI owns two large vessels for emergencies; the 208-foot anchor handler ship Perseverance and a 180-foot offshore supply vessel rigged for oil spill response. The organization also offers these boats for offshore supply operations in support of member organizations as a way to generate revenue to offset expenses. www.akbizmag.com

Through the Short Notice Response Team, CISPRI works with specialized contractors to take care of marine birds and animals. “We contract with a professor at Texas A&M who specializes in marine mammal care and are also in the process of contracting with the Alaska SeaLife Center in Seward,” says Paxton. “We also work with International Bird Rescue, which has an office in Anchorage and specializes in the care of marine birds, and we own and maintain the Sea Otter Rehabilitation Center in Seldovia, which is the first point for triage and cleanup of oiled sea mammals.” As oil and gas companies continue to expand their reach into Alaska and the Arctic, keeping on top of potential hazards will become even more important. “Alaska Clean Seas is the only OSRO in the nation that has a research and development[R&D] budget that enables us to work nationally and internationally on spill response projects,” says Lloyd. “We are able to maximize these R&D dollars by being a member of the Global Response Network, which is made up of seven OSROs from around the world including England, Norway, Canada, and Australia.” To be a member of the network, members must be willing to provide subject matter experts to operational teams. “This enables us to stay up-todate on what research and development is going on in other parts of the world,” says Lloyd. “We feed this knowledge to each other through regularly scheduled meetings, which is a really great way to stretch R&D dollars.” And while Alaska’s OSROs hope that they will have a slow year, it’s nice to know that they are ready and willing to act immediately to prevent damage to Alaska’s environment. “In an ideal year, there would be no incidents, but bad things happen,” says Melton. “We have bad weather, and things break. Our job is to get to it as fast as we can, clean it up, and get ready for the next one.” Adds Lloyd, “We’re organized like a fire department—comprised of both professionals and volunteers, ready twenty-four hours a day, ideally to prevent incidents and to safely respond when they do.” 

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Vanessa Orr is the former editor of the Capitol City Weekly in Juneau. www.akbizmag.com

April 2014 | Alaska Business Monthly

MINING

Photo courtesy of Donlin Gold

Donlin Gold camp and runway.

‘A really big deal’ By Julie Stricker

outhwest Alaska is a vast, sparsely populated, largely roadless region of isolated villages, mountains, rivers, muskeg, and tundra. Jobs are scarce and industry is all but unheard of. But that’s likely to change in the next decade. One of the world’s largest gold deposits lies in Southwest Alaska ten miles from the tiny Kuskokwim River village of Crooked Creek. The Donlin Gold Project holds probable reserves of an estimated 33.9 million ounces of gold with an average grade of 2.2 grams per tonne, according to Kurt Parkan, external affairs manager for Donlin Gold. Another approximately 6 million ounces of gold is inferred. According to parent company NovaGold, this puts Donlin Gold “well within the top 1 percent of known global gold deposits in terms of size.” 36

Alaska Business Monthly | April 2014

“This is a really big deal,” Parkan says. “The project itself is large, both the amount of the resource and the number of people employed. It’s particularly large for a region that has had no industry in the past.”

Game-Changer Placer gold was first discovered in the region in 1909, and small-scale mining took place over the ensuing decades. In the mid-1980s, geologists took a closer look at the area and in 1988 discovered a world-class ore body. It’s a gamechanger for the residents of the area, with its effects felt statewide once production begins. The surface land is owned by The Kuskokwim Corporation, a consortium of ten villages. The subsurface belongs to Calista Corporation, a regional Native corpora-

tion that encompasses fifty-six villages in the Yukon-Kuskokwim region. In the past, Calista has indicated strong support for responsible development of natural resources and is working closely with Donlin Gold to plan for work force development. Any production is still years away as Donlin Gold works through a many-tiered process of reports, studies, permits, and construction that must be completed before the first bar of gold is produced. All of the additional work will give the company a better sense of what the scope of the project entails, how to best protect the environment, and make the most of the mine economically, Parkan says. Parkan said there are too many variables in the process for him to be able to give even a ballpark estimate of when the mine would open. www.akbizmag.com

“Once permitting is done, construction will take nearly four years,” he says. “We anticipate permitting to take a good four years and we started in 2012. You can do your own math, but I’m not able to give you a number.”

Big Deposit Using current reserves, the mine’s life expectancy is twenty-seven years and it will be one of only a couple of sites worldwide capable of producing 1.3 million ounces of gold annually. As a reference, the total recorded gold production for the Klondike from 1885 to the present is about 12.5 million ounces, according to Gold Investing News. NovaGold notes that the current mining project takes up only part of a threekilometer portion of an eight-kilometer mineralized belt, giving the project substantial future exploration potential. Eleven different mineralized areas have been identified in the Donlin deposit, with at least one, the Dome deposit, being eyed as a future stand-alone site. As it looks now, the gold would be mined in a conventional truck-andshovel open pit process and milled on

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site. The pit itself will be about two miles by one mile. The ore will be trucked to the zerodischarge processing plant where it will be crushed into a fine powder in large semi-autogenous grinding and ball mills. The ore-bearing silt will be washed and concentrated and put into an autoclave, where heat, pressure, and oxygen will be used to pre-treat the ore. Cyanide will be used to dissolve the gold. The dissolved gold will then be mixed with activated carbon and the cyanide solution detoxified. The gold will be extracted from the carbon in a process similar to electroplating. It will then be refined and shaped into gold doré bars for transport.

The Power The milling process requires a huge amount of electricity, which will be generated on-site and powered by a 314mile natural gas pipeline from Cook Inlet. The power plant will be capable of providing an average load of 157 megawatts. Donlin Gold did explore other energy options, such as shipping millions of gallons of diesel fuel up the Kuskok-

Photo courtesy of Donlin Gold

Danny Twitchell mercury testing.

April 2014 | Alaska Business Monthly

wim River, which would have been prohibitively expensive and run a high risk of fuel spills on the salmon-rich river. Coal, hydroelectricity, a power line intertie, biofuel, and even nuclear energy were considered but discarded. Even so, construction of the natural gas pipeline itself will be a huge undertaking. The original route of the line overlapped with the historic Iditarod Trail, heading over Rainy Pass and through the treacherous Dalzell Gorge. Much of that route was realigned in 2013, called the Jones Realignment, which greatly re-

duces overlap with the Iditarod Trail and rough mountain terrain. The fourteen-inch diameter steel pipeline will be mostly buried with above-ground safety check valves every twenty miles. The pipeline would be above ground where it traverses known fault lines. In 2013, Donlin Gold completed the engineering, cultural, and wetlands surveys for the pipeline.

The Project Other facilities include a water treatment plant, housing, two ports, and an

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Alaska Business Monthly | April 2014

airstrip, as well as vehicles for construction and mining operations. Total capital expenditures are estimated at $6.7 billion. Donlin Gold LLC, a 50/50 partnership between NovaGold Resources Alaska and Barrick Gold North America, oversees the project. According to its 2013 fourth-quarter fact sheet, Donlin Gold is exploring the possibility of partnering with third parties to share up-front capital costs, such as the construction of the pipeline. “The scoping process was completed last year and right now they are working on the development of alternatives,” Parkan says. “Once the analysis is done on the alternatives, a draft EIS [Environmental Impact Statement] will be released for public comment.” The comments will be studied, a final EIS developed, and a public record of decision made. The EIS is expected to be complete early in 2015. “Then we will continue working on getting all of our permits,” Parkan says. “We expect we will need approximately one hundred different permits for this project from federal and state agencies.” Construction would provide about 3,000 jobs and between another 800 and 1,400 well-paying, year-round jobs during operations. The potential impact is huge, says Thom Leonard, communications manager for Calista. Southwest Alaska is one of the most economically challenged areas in the state, with few jobs and some of the highest energy costs in the country. Many residents still live a subsistence lifestyle, hunting, fishing, and gathering to put food on their tables.

Local Outreach Although construction is still several years down the road, Donlin Gold has been working closely with Calista and local residents. “We have been talking to folks in the region for years now,” Parkan says. “One of our major emphases has always been to communicate with the region and let them know what’s going on with the project. That has resulted in a good outcome for the project.” The Army Corps of Engineers was very impressed by the quality of the comments generated from scoping www.akbizmag.com

Ninety percent of the workers at Donlin Gold are Calista Corporation shareholders. Photos courtesy of Donlin Gold

meetings in the region, he adds. Donlin Gold’s outreach is continuing. Parkan says Donlin Gold staffers are planning to visit thirty different communities this year. One particular focus is on what the project means for younger people. “We talk about training,” he says. “We talk about completing high school. We talk a little bit about the kinds of jobs we’ll have at the project, and we’ll just talk to the kids about setting goals and having a plan for the future.” To date, 90 percent of the workers

on the project have been Calista shareholders. “Local hire has been very important to us and will continue to be very important to us,” he says. Their efforts have been noticed. The National Association of State Workforce Agencies named Donlin Gold its 2013 National Employer of the Year on the strength of its local hire and outreach efforts, Parkan says. Donlin Gold helps fund scholarships through the Calista Heritage Foundation; sponsors “Voyage to Excellence,”

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a program that helps students develop personal and social skills and job basics; and a summer internship program. In 2013, Donlin Gold contributed $75,000 to the scholarship fund. Donlin Gold also created a brochure outlining potential jobs at the mine and urges shareholders to fill out a Talent Bank Profile to be considered for future training and jobs. Not only will the Donlin Gold project have a profound impact on Southwest Alaska, its reverberations will be felt across the state. Calista, which was created under the Alaska Native Claims Settlement Act, is subject to that act’s revenue-sharing provisions, which take 70 percent of Calista’s net profit from resource development and divides it among the twelve Alaska-based regional corporations. In short, Donlin Gold is a big prospect in a big state that will have a big impact on Southwest Alaska for generations.  Julie Stricker is a journalist living near Fairbanks.

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MINING

Enormous Impact of Alaska’s Producing Mines

The big six pour money into local and state economies

Left: The Fort Knox footprint. Above: The Fort Knox Pit. Photos by Greg Martin

By Julie Stricker

or Alaska miners, 2013 was a difficult year. Gold prices dropped and exploration dollars followed suit. One of the state’s seven operating mines, Nixon Fork, shut down, and major mining companies left the state. Energy prices were stuck firmly in the stratosphere, fueling increases in operating costs. Federal oversight also increased. Exploration spending dropped 38 percent statewide in 2013, totaling about $180 million. Despite the difficulties, Alaska’s six producing mines met major milestones in 2013 and entered 2014 on strong footing. Mining remains a major economic force in Alaska, employing 4,600 people directly and double that number in jobs indirectly tied to the industry, according to recent numbers released by the McDowell Group in a survey conducted for the Alaska Miners Association and Council of Alaska Producers. Mining jobs are some of the best-paid in the 40

Alaska Business Monthly | April 2014

state, averaging $100,000 annually, for a total direct payroll of $630 million in 2013. Karen Matthias, a board member of the Alaska Resource Development Council and consultant for the Council of Alaska Producers, noted the challenges in a talk at the November 2013 Alaska Resources Conference. “More than $2 billion has been spent on dozens of exploration projects over

the last thirty years, but we only have six large mines,” she told the conference. “That gives you a perspective of how much goes into mining.” Alaska’s six producing mines are Kensington and Greens Creek in Southeast Alaska; Pogo, Fort Knox, and Usibelli in Interior Alaska; and Red Dog in Northwest Alaska. Statewide, these six mines spend half a billion dollars with Alaska businesses www.akbizmag.com

BusinessPROFILE

Arctic Branding & Apparel

It’s been said that safety doesn’t happen by accident

or Angela Cernich and her company Arctic Branding & Apparel, “Keeping Alaska Safe” isn’t just a slogan. It’s the guiding principle empowering AB&A to seek out products and education to help protect Alaskan workers and ensure healthy work place environments. Cernich was born and raised in Alaska. Her family roots and Athabascan heritage continue to drive the entrepreneurial spirit that helped build Arctic Branding & Apparel from a home business in January 2012, to a 2,600-sq. ft. office/warehouse on Fireweed Lane a few months later, to the current 20,000-sq. ft. south Anchorage facility that includes a new show room, embroidery department, warehouse and training facility. “I had been working in the promotional products industry for quite a few years. While working for another company, one of my clients mentioned ‘FRC’ and asked me if we could carry it. My boss wasn’t interested, but I didn’t waste any time finding out everything I could about Flame Resistant Clothing (FRC),” said Cernich. That research determined that the biggest challenge for Alaskan customers for FRC was lack of available product combined with high pricing. Fortunately, in September of 2012, Cernich met with Big Bill, a manufacturer of FRC and work wear. Like AB&A, the manufacturer had also researched the market in Alaska and determined a need. “Big Bill was looking for a distribution partner; we were looking for a manufacturer. We found that our values and goals were in line. As we collaborated on solutions to the biggest challenges our clients faced, we

CEO Angela Cernich and Team at Arctic Branding & Apparel

came up with the concept of a large warehouse with products available at all times and right here in Anchorage,” said Cernich. Indicative of AB&A’s momentum, an Arctic Safety Division has been launched, directing services on Alaska’s climate, geography and industrial diversity. The new division adds Arctic apparel and equipment, in addition to educational tools, greatly expanding the company’s menu of services and products. When asked about advice to others starting a business, Cernich reminds that first and foremost, believe in your vision. Do the research to make sure it is a viable business. Once you have the commitment and plan, surround yourself with people who believe in your dream and work hard. Integrity, ethics and earning respect matters, especially when it comes to safety. –

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Commitment and focus are foundations for Arctic Branding & Apparel. A commitment to making Alaskans safer; a focus on the latest and most innovative technology and resources to ensure Alaskans remain safe in the future. At the end of the day, Arctic Branding & Apparel’s hard work will hopefully mean more Alaskan workers will avoid injury. And that’s no accident.

501 Raspberry Road Anchorage, Alaska 99518 907-868-3630 ArcticBranding-Apparel.com

for goods and services. Locally, their economic impact is enormous.

Fort Knox Gold Fort Knox gold mine, located twentyfive miles northeast of Fairbanks, employs 630 people, all of whom live in the Fairbanks North Star Borough, says Anna Atchison, community and government affairs manager. The annual wage is $92,000. Another 400 contractors also worked at the mine in 2013. “I’m sure we’ll continue to bring on new folks as we get closer to summer,” Atchison says. “We always do.” Having workers live within daily driving distance of the mine is a luxury only one other Alaska mine has, Usibelli Coal Mine in Healy. Fort Knox responds by being actively involved in the community. “Of course, we’ve been operating here for a long time and been part of the community for a long time,” Atchison says. “We’re the fifth largest private employer, the largest taxpayer, and a significant driver when it comes to community investment.” Fort Knox, owned by Kinross subsidiary Fairbanks Gold Mining, Inc., is the state’s largest open pit mine. Construction began in 1995, with the first gold pour in December 1996. The mine poured its 6 millionth ounce of gold in December 2013. Most of the ore is considered to be low grade, so the mine compensates by operating on an enormous scale. The mine added to its ﬂeet of huge trucks in 2013 and now operates nineteen 240-ton haul trucks, nine 190-ton trucks, and ten 150-ton trucks. The additions meant another 100 workers to 2013’s newest big truck at Fort Knox. Photo by Greg Martin

Photo by Greg Martin

The bar of gold holding the six millionth ounce of gold milled at Fort Knox.

drive the trucks, as well as support and maintain them. The higher grade ore is processed in a SAG mill, while lower-grade ore is stacked on the heap leach, which was built in 2008. In 2013, Fort Knox produced 428,822 troy ounces of gold, slightly higher than its forecast of 425,347. That comes out to an average of 1,200 ounces, or 75 pounds, of gold daily. The costs of producing the gold are also enormous. Fort Knox spent $81 million in labor and benefits in 2013; $54 million on fuel; $43 million on electricity; and $5.2 million in property taxes. So far, 2014 looks quiet for Fort Knox, with no major projects in the works, Atchison says. The mine constructed a new “carpet and column” processing facility in 2013, and work continues to

stack the heap leach, which “continues to be a significant driver for us,” she says. Although the mine’s projected lifespan extends only to 2019, plus another four years for the heap leach, Atchison says further exploration is continuing, but no results have been released. The mine will continue its community outreach this spring, with five public tours scheduled this summer that also serve as a fundraiser for the Fairbanks Community Food Bank. From midApril to the end of May, Fort Knox also hosts hundreds of local schoolchildren, parents, and teachers, who tour the mine facilities and learn about mining. “Six hundred kids will come out,” Atchison says. “That’s a big part of what we do, sharing the story of modern mining with the community and the state.” Some of those kids may end up working at Fort Knox someday, she says. Fort Knox recently recommitted to its second three-year endowment to the University of Alaska Fairbanks to support graduate student research in mining engineering. One of the paybacks is getting qualified workers. Atchison notes that its entire exploration team graduated from UAF. “We’re a very large part of the community and that’s something obviously we’re very proud of,” Atchison says.

Pogo Gold In 2013, Pogo Gold Mine commissioned a study by Alaska consulting firm The 42

Alaska Business Monthly | April 2014

www.akbizmag.com

Alaska Business Monthly | April 2014

www.akbizmag.com

Photo by Judy Patrick

grade of 0.366 ounces per ton. Pogo spent $10 million on exploration in 2013. “Positive results are pending,” Shaw says, laughing. She adds, “We did spend $10 million on exploration and it was an encouraging season. We’ve got more than $10 million in exploration planned for this summer.” Pogo expects to spend $30 million to $40 million on capital projects this summer. Production has already begun on East Deep, Shaw says. One is a new portal, named according to elevation, into the underground mine. Three other portals already exist, two are used to transport people underground, and the other one is for transportation and venPhoto by Judy Patrick tilation. The new one, 2150, will be the Pogo Mine dorm facilities, ofﬁ ce, and maintenance shop in the foreground with fourth. It will serve as access for a defithe new 2150 portal in the background, in September 2013. The 2150 provides nition drilling program in East Deep. The other two projects are a mine waadditional access to the underground mine workings. ter treatment plant and improvements McDowell Group to examine its eco- lion in taxes to state government in 2012. to underground services. nomic impact on Interior Alaska. The “In terms of what we’re focusing on Previous projections estimated results show the mine is a major stimu- right now, right now our guys are really Pogo’s mine life to extend only to 2019, lus for the region. busy,” Shaw says. “We’re really working “but with all the exploration work we’ve Pogo, owned by Sumitomo Metal a lot on the Liese zone, which is the ore done, and all the work we’re planning Mining, is an underground mine body we’ve always been in. We’ve got on, we expect to continue for quite a about eighty-five miles southeast of the North Zone, and then South Pogo. ways beyond that,” Shaw says. Fairbanks and thirty-five miles north That’s all connected and we’re doing adPogo’s mill sits at what geologists beof Delta Junction. It was discovered in ditional exploration on that.” lieve to be a conjunction of three min1994 and went into production in 2006. In 2012, another major ore body was eralization zones: the Liese zone, East It is Alaska’s largest gold mine, produc- discovered at Pogo. Called East Deep, Deep, and North Pogo. Exploration ing 337,000 ounces in 2013 and expect- the deposit contains an estimated 1.2 continues to map the extent of the mining to produce about 345,000 ounces in million ounces of gold and potentially eralization. 2014, according to Pogo’s public affairs more. That brings the total resource at “It’s exciting,” Shaw says. “We see a director Lorna Shaw. Pogo to 4.9 million ounces at an average long and healthy future for Pogo.” The mine employs 320 workers directly, with another 100 to 200 contractors as needed. Average pay was $116,916, more than twice the average Alaska statewide annual income of $50,100. About two-thirds of Pogo workers live in Alaska. In 2012, the mine had a direct payroll of $38.5 million and spent $127.2 million for supplies with Alaska businesses. About 65 percent of the money was spent in the Fairbanks North Star Borough and in Delta Junction. Of that, $10.1 million was spent in Delta, which is a significant amount for the small community. Another 34 percent of the money was spent in Anchorage. Indirectly, Pogo also accounts for an additional 215 jobs and $18 million in The Pogo Mine new electrical substation shown in September 2013 and compayroll. The mine also paid $24.3 mil- pleted in fall 2013.

Fort Knox Stewardship in Action The way we see things, stewardship extends well beyond protecting land and water. It’s also about taking care of our people. That’s why we invest in advanced training, safety, and modern mining technology. The return? We have the best people in the industry working for us. Fort Knox places high value in community stewardship. We buy locally, hire locally and we’re active in charitable giving, and our people volunteer in many civic and community groups. And, as far as protecting the land and water, our record stands on its own. At Fort Knox, responsible stewardship is part of how we do business every day. Fairbanks Gold Mining Inc. A Kinross company

kinross.com

Greens Creek Silver The Greens Creek Mine operated by Hecla Mining Company on Admiralty Island is among the world’s top ten silver producers. It is Southeast Alaska’s largest for-profit employer, with nearly 400 workers. The mine produced 7.4 million ounces of silver in 2013, a 39 percent increase over 2012. Greens Creek also produces lesser amounts of zinc, gold, and lead. “This year is the largest silver reserve increase since the acquisition of Greens Creek in 2008 and the highest level of silver and gold reserves in our company’s 122-year history,” Hecla President and CEO Phillips S. Baker Jr. stated in a news release. A 2013 decision by the US Forest Service allows Greens Creek to expand its tailings facility, effectively lengthening the life of the mine. It expects to produce more than 6.4 million ounces of silver in 2014 and currently has proven reserves of 94.5 million ounces. Hecla is continuing to aggressively explore and continues to find new mineralization centers. Kensington Gold Kensington Mine is the second largest private employer in Southeast Alaska in terms of payroll and the largest property tax contributor to the city and borough of Juneau. The gold mine, located about forty-five miles from Juneau, showed strong gold production in 2013, tallying nearly 115,000 ounces of gold, up 40 percent over 2012. The mine, owned by Coeur Mining, plans to increase mill throughput in 2014 to offset lower ore grades as the mine drills toward higher-grade ore. Coeur Mining forecasts Kensington to produce up to 112,000 ounces of gold in 2014. Red Dog Zinc Red Dog is one of the world’s largest producers of zinc concentrate and is the economic engine for Northwest Alaska. The mine sits on land eightytwo miles north of Kotzebue owned by NANA Regional Corporation and is operated through a partnership between Teck Resources Ltd. subsidiary Teck Alaska, Inc. and NANA. The mine employs more than 600 people, 53 percent of whom are NANA shareholders. Total payroll in 2012 was $58 million, $34 46

Alaska Business Monthly | April 2014

million of which was earned by NANA shareholders. It is the only taxpayer, payments in lieu of taxes, in the Northwest Arctic Borough. In 2012, Red Dog paid approximately $13 million PILT. “Red Dog is important to NANA,” says NANA Regional Corporation President Marie Greene on the company website. “It is more than just a mine—it has become a way of life and has provided hope for the future for many of our shareholders.” The mine undertook a series of technical upgrades to its facilities in 2013, including improvements to its tailings dams and environmental work around the Aqqaluk deposit. A total of 1.3 million WMT of concentrate was shipped out, 7 percent over its target. However, total zinc sales decreased by 22 percent, according to Teck Resources’ annual summary. Operations at Red Dog began in 1989 and known reserves are expected fuel mining operations through 2031. The main ore pit was closed in 2011 and mining began on the adjacent Aqqaluk body, which contains an estimated 51.6 million tons of reserves, containing 16.7 percent zinc and 4.4 percent lead. The ore is mined from an open pit on the tundra northwest of Kotzebue. It is trucked along a fift y-two-mile haul road to the coast, where the concentrate is stockpiled until it can be barged out during the short ice-free summer months. The partnership extends benefits beyond mining jobs. Other NANA subsidiaries provide support and services such as engineering, trucking, logistics, housekeeping, security, and construction. NANA also provides shareholders with scholarships and training and works to preserve their traditional cultures and subsistence way of life. Under the Alaska Native Claims Settlement Agreement under which NANA was formed, the corporation must share a portion of the profits from the mine with the other Alaska-based regional and village corporations. Under this agreement, NANA has paid out more than a half-billion dollars to Alaska Natives statewide.

Usibelli Coal Usibelli Coal Mine is the state’s only

coal producer. The fourth-generation family-owned operation employs about 130 workers and its ultra-low-sulfur subbituminous coal fuels 40 percent of Interior Alaska’s electricity. The mine is located in Healy, 115 miles south of Fairbanks. The mine was founded in 1943 by Emil Usibelli. Production has grown from 10,000 tons in 1943 to an average of 2 million tons per year. It has been mining in an area called Two Bull Ridge, but is building a road to an area dubbed Jumbo Dome. There, Usibelli plans to extract 80 million to 90 million tons of coal over the next thirty years. The mine directly accounts for 30 percent of all employment in Healy and 60 percent of the wages paid in the community. Usibelli’s year-round employment is a big factor in the economics of the Denali Borough, which is dominated by a seasonal tourism industry. Usibelli is looking to expand its reach overseas, where its ultra-low-sulfur coal is in great demand. Spokesman Bill Brophy notes Usibelli’s coal contains less than two-tenths of a percent of sulfur. Elsewhere, coal deposits contain as much as 4 or 5 percent sulfur. Half of its production is exported to Chile, South Korea, and other areas around the Pacific Rim. While Usibelli has exploration permits for other areas, it has not put much of an emphasis on looking for more coal. The company does have permits to look for natural gas in the Healy Valley. Brophy notes that Usibelli’s current leases contain as much as 700 million tons of coal: a 350-year supply at its current rate of production. That’s good news for Interior Alaska. A 2013 McDowell Group study notes that energy prices in Interior Alaska, already nearly twice the national average, would be as much as 25 percent higher if Usibelli coal was not available. Usibelli coal generates nearly a third of Interior Alaska’s electricity at a sixth of the cost of energy generated by oil. “Including GVEA, UAF, and the military bases, the absence of coal as a fuel source would have a cost of $200 million or more annually,” the study says.  Julie Stricker is a journalist living near Fairbanks. www.akbizmag.com

BusinessPROFILE

eDocsAlaska Inc.

Excellence in Document Management Solutions — Helping Alaska Businesses Run Smarter®

ompanies today face a growing number of challenges with managing their information. The volume of business information is doubling every few years. Employees are becoming more mobile, requiring remote access to company records. Regulatory requirements for handling data are increasing. And the costs to store information keep rising, with the average office having 19 copies of a document and spending $20 to file each item. eDocsAlaska Inc. offers a solution to help businesses run smarter. The company’s digital document management services help people access and handle information with more speed, efficiency and accuracy. eDocsAlaska has the expertise to identify requirements of a business process, develop the technology/tools to streamline and/ or automate document handling, provide training, and support and modify the solution to adapt to a company’s growing and changing information challenges as time goes on, according to President Pam Hanneman. “We are with you long after the sale to provide support and to assist in expanding the Laserfiche® system to accommodate company growth,” she said. Established in 2000, eDocsAlaska is a value-added reseller of Laserfiche® electronic document management software, which is developed by Compulink. With this as its sole focus and 25 years of experience implementing

digital document software solutions, the company understands records management and knows how to effectively analyze requirements and customize Laserfiche® software to meet clients’ needs. “We get to know your pain points, so we can provide a solution that will improve employee efficiency and performance,” Hanneman said. All organizations—whether they have five or 500 employees—need quick access to information, Hanneman said. However, many people don’t realize the significant cost of managing paper files or spending time searching for documents. According to the Association for Information Image Management, a company can increase productivity by 30.9 percent with electronic document management and by 33.5 percent with work flow automation. More and more, businesses recognize their document management needs require more than a digital archive of historic files; they need easy access to their active files, too. eDocsAlaska has expertise in designing and implementing workflows to automate heavy, paper-intensive processes for organizations. It works with an array of clients, including resource companies, Native organizations, law offices, commercial businesses, and cities and boroughs. Recently, the company completed extensive software upgrades and training within 18 departments at Chugach Electric, which –

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has been using Laserfiche® since 2002. It also recently automated processes to scan, categorize and store accounts payable documents at Ketchikan Gateway Borough. Current eDocsAlaska projects include implementing workflows to manage claim files at Alaska Municipal League Joint Insurance Association, installing a new Laserfiche® system for City of Homer and imaging its historic public records, and implementing an enterprise Department of Defense certified records management solution at Matanuska Telephone Association. As validation of its work and expertise, eDocsAlaska has received industry recognition, including Laserfiche® Gold certification, three Compulink’s Value-Added Reseller Winner Circle awards for sales, and write-ups in two international mining magazines. For the future, eDocsAlaska is looking forward to helping a growing number of Alaska businesses transition to digital documents and automated business processes.

eDocAlaska Inc. Pam Hanneman, President 1035 West Fireweed Lane, Suite 200 Anchorage, Alaska 99503 907-248-8472 edocsalaska.com

CONSTRUCTION

Photo courtesy of Alaska Minerals Inc.

An Alaska Minerals, Inc. camp set up for Pathﬁ nder Minerals Services in the Delta Junction area.

Mod Man Camps for Mining ‘All the amenities of home’ By Louise Freeman

state-of-the-art gym, tasty meals prepared by a professional cook, comfortable accommodations with hot showers, and thick ﬂuff y towels: Sound like an upscale hotel? Think again. Modular workforce housing, also known as “man camp accommodations” can offer all the amenities of home for workers living far from their families for as much as six to nine months of the year. Such man camps exist at minerals industry sites all over the state of Alaska, as well as at sites for the oil and gas, geothermal, environmental cleanup, and construction industries. An addition to accommodations, man camps usually include a kitchen, dining area, shower units, locker rooms, restrooms, and laundry facilities. Special amenities may include a lounging 48

Alaska Business Monthly | April 2014

area, commissary, recreation room, and gym or fitness room. In addition, other mobile units are devoted to site operations, including power generation, telecommunications, water purification, and wastewater systems. Project oﬃces, meeting rooms, a guard house, and first aid station may complete the site.

Turnkey Operations Ready-to-go complete modular man camps are often referred to as “turnkey operations.” Most commonly, these camps are set up with either ATCO modular units or “soft-sided” units (tents). The ATCO units are similar to mobile homes on skids. They can be delivered by aircraft, truck, helicopter, landing craft, or barge. For more remote camps, soft-sided units are used. Although they take longer to

set-up, tents can be just as comfortable as ATCO units and are easily broken down and moved by aircraft or slung beneath a helicopter. Many mining camps use fabric tension structures made by Hansen WeatherPORT, which are made of a heavyduty, leak-proof rubberized fabric and can withstand up to 1one hundred-mile per hour winds. They can be ordered with or without insulation, and each building is provided with a Toyo stove. Alaska Minerals, Inc. (AkMin) provides set-up for ten- to thirty-man camps. “Our target size is under twenty-four people because of the easier permitting with DEC,” says owner Michael Smith. “We will do larger camps, but then we have to have engineering for septic and a well.” Sleeping units are usually 12 by 10 feet for one to two people, with an approxiwww.akbizmag.com

BusinessPROFILE

Doyon Remote Facilities & Services

Photos courtesy of Doyon Remote Facilities & Services

Doyon Remote Facilities & Services: The Modern Approach to Remote Living

oyon Remote Facilities & Services (DRFS) is a Minority Business Enterprise of Alaska Native regional corporation Doyon, Limited. Formed in 2012, DRFS provides camp services in remote locations from the North Slope to the Kenai Peninsula of Alaska and everywhere in between. The mission of DRFS is to “offer safe, contemporary, and comfortable accommodations in remote locations.” DRFS owns and operates seven camps: Camp Sackett, Camp Wallis, Camp Notti, Camp Chena, Camp Yukon, Camp Thompson, and Camp Maher, ranging from 21 to 80 beds per camp, with the exception of Camp Sackett offering 210 camp beds. DRFS provides seasonal set-up of modular buildings and man camps for exploration and development for mining and oilfield industries. In addition to modular construction, DRFS also provides camp services, construction management, and logistical support to clients. Complete with modern amenities and many comforts of home, DRFS provides a necessary service to those

building Alaska’s future, featuring quick mobilization, flexibility in configuration, and the ability to adapt to client needs. DRFS is poised to expand its fleet of camps in order to meet the ever-changing requirements of Alaska’s natural resource development projects. DRFS has the experience and expertise to operate safely at any remote site, whether it’s supporting the oil and gas industry from Point Thomson to Kuparuk, Prudhoe Bay to the Kenai Peninsula, or other Alaskan mining industry locations. The management and supervisory personnel of DRFS have extensive experience, from initial development to operations, in OSHA and MSHA environments, including Kensington, Fort Knox, Rock Creek, Red Dog, and Pogo mines. DRFS is proud to be Alaskanowned, Alaskan-operated, and Alaskan-employed. Shareholder hire is a key tenet of its operations, with over 40% of management and 80% of field crews being Alaska Native. Currently housing over 450 workers at various sites throughout Alaska and supporting many of Alaska’s largest and most –

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important construction projects, DRFS has the expertise needed for building, moving, and operating top-end camp facilities across the state and in extreme climates. In addition to remote camp facilities, DRFS offers numerous other support facilities and services. During the summer of 2013, DRFS provided an emergency remote health clinic to FEMA for the Village of Circle, converting an office unit to a state of the art health clinic in less than two weeks in support of flood relief operations. “Our ability to meet the client’s needs safely and quickly without sacrificing quality is what sets us apart,” stated DRFS Operations Manager David Gonzalez.

For more information about Doyon Remote Facilities and Services, please call (907) 375-4240 or visit www.doyonremotefacilities.com

Unga Island camp set up by Alaska Minerals, Inc. for a mining exploration project looking for a high grade, underground gold deposit . Unga Island is south of Sand Point on the Aleutian Chain and is one of the largest of the Shumagin Islands. Photo courtesy of Alaska Minerals Inc.

Alaska Business Monthly | April 2014

www.akbizmag.com

mate interior standing height of 8.5 feet. The kitchens are 16 feet wide and can be 24, 30, or 40 feet long, with a peak of 10.5 feet. AkMin puts up five to ten camps a year (not all for mines), such as the Tetlin project for Contango Ore, a man camp set up on the road system near Tok in 2013. Although the WeatherPORT units are interchangeable, “we have a set design,” says Smith, “where the kitchen and shower go in the same order because there are harnesses for plumbing, lighting, and electricity. We want to stay as uniform as possible.” At more remote locations, the site is usually selected from the air before AkMin hits the ground. They try to locate the camp within a reasonable distance of a lake or stream. “A lot is predicated on how far you are from surface water. That is primary for picking a location so you don’t have to pump water two or three miles uphill. Water only becomes a challenge where we have to pump it a long way,” says Smith. AkMin has a DEC-approved water filtering system for giardia and particulates.

Gray Water Challenges Global Services, Inc. sets up man camps using either ATCO units or tents. Aside from access to water, dealing with gray water is usually the other biggest challenge. “Everything else [about set-up] is relatively easy,” says Owner and President Kurt Winkler. “Nine out of ten times we can get set up in hours or a day, up and running. All the client has to do is plug in and start up the generator,” says Winkler. Diesel is their fuel of choice because the clients often also need it for their equipment. Generators range from 20-120 kilowatts, depending on the size of the camp. In addition to setting up ATCO or WeatherPORT camps, Global Services offers management services, with a strong focus on quality of life. Taking care of the workers means more than simply making them comfortable. “It brings safety into focus,” says Winkler, “If guys are well taken care of in their living environment, they are not prone to accidents as much. It’s the morale booster that makes it a home. We’re very enthusiastic about keeping up morale.” To operate these man camps requires an experienced management staff, which may range from a single cook at a remote exploratory site to several hundred staff at a permanent installation. Services www.akbizmag.com

may include product procurement and expediting, food and housekeeping services, maintenance personnel, professional consulting services, client in-town catering functions, and janitorial services. Larger management services companies may also include security and fire and emergency personnel.

Service for 570 Red Dog Mine, operated under an innovative agreement between NANA Regional Corporation and Teck, has three man camps: at their port facility; at their

n o r t h w e s t

construction site; and at the main facility, the Personnel Accommodations Complex (PAC). PAC is also known affectionately as “The Dog House.” Housekeeping, janitorial, laundry, and food services at Red Dog Mine are provided by NANA Management Services (NMS). NMS staff totals 75, including 60 NANA shareholders, serving 570 workers when the camps are at full capacity. (There are 700 workers but no more than 570 of them are at the Red Dog Mine in any given week.) “Prospective clients sometimes come to us with a design that looks good on

s t r a t e g i e s

look again

Alaska Native-owned and operated, Northwest Strategies is relied on by the corporate enterprises of Alaska’s first people to grow their business interests with purpose and pride. We celebrate our heritage while using it to advance Alaska and its people better than any communications firm in the state.

It’s about more than having a good idea. It’s about knowing what it means to pull in nets and grow up in a village. It’s understanding the wisdom from 10,000 years of Native tradition and weaving it into a new way of thinking. tiffany tutiakoff northwest strategies President

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April 2014 | Alaska Business Monthly

A Global Services, Inc. WeatherPort camp in June 2012. The company specializes in ATCO and tent camps and provides morale boosting services to keep workers happy and safe. Photo courtesy of Global Services, Inc.

paper, but they often cram a lot of things together,” says Eric Fox, chief operating oﬃcer of NMS. “When possible we like to give input into the layout of halls, rooms, kitchens; how to make it more

Alaska Business Monthly | April 2014

eﬃcient and most importantly safe for workers and staff. Just where the loading dock is relative to the kitchen may mean you have to add an extra person to unload freight or an extra person in house-

keeping because of poor room design.” NMS prides itself on the friendly environment they help foster. “What’s different at Red Dog is the sense of community—when you have so any regional folks who grew up together and know each other, it’s like a large family. And the quality of life standard helps keep them motivated, productive, and safe. We have embraced world-class, cutting edge safety programs.” NMS received a National Industry Leader Award by the National Safety Council for its 2009 safety performance within the mining industry. In addition to standard behavior-based employee safety training, where the workers observe each other and give feedback, NMS also has instituted a people-based safety program developed by E. Scott Geller of Safety Performance Solutions, Inc., a Virginia-based company. The people-based system emphasizes building a strong work culture in which the workforce feels strongly engaged. “It’s about the individual and how they feel about themselves and the work they’re doing. Safety performance is a byproduct of all performance,” says Fox. Red Dog is unusual in that it has a worker-run committee made up of residents,

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Photo by Chris Arend Photography | Courtesy of NMS

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Alaska Business Monthly | April 2014

funded by proceeds from the commissary. They make decisions such as what goes into the rec room or how to remodel the weight room. “The recreation committee is really in tune with the right things to make it comfortable,” says Fox. On holidays like 4th of July they organize special events. “The rec leagues play against each other in friendly competition,” says Fox.

‘Logistics is a Big Part’ With the enormous amount of supplies required to keep the Red Dog camps running, NMS tries to barge in the majority of supplies needed to last most of the year. Perishables are flown in. Even at the smaller camps, well-planned expediting and transportation is crucial. “Logistics is a big part of what we’re doing at AkMin,” says Smith, “getting stuff around the state as fast and efficiently as we can.” AkMin works with what are often referred to as “Canadian junior companies,” whose main offices are in Vancouver. “A lot of time they have fifteen to twenty-five people doing minerals exploration for three to four months,” Smith says. “They usually have three contractors: camp, helicopter, and drilling. We start from scratch and bid for the size of the camp. We send in a four- to seven-man crew, spend four to six days setting up and getting it ready to occupy. At that point we walk away, leaving a cook there and possibly a laborer.” www.akbizmag.com

Photo by Danny Daniels Photography | Courtesy of NMS

NANA Management Services provides Red Dog Mine camp services. Daphne Schuerch of Shungnak works in food service, Harold Downey of Kotzebue and Joe Penn of Noatak are shown in the food service warehouse, and Stella Sage of Kivalina works in housekeeping.

Man camps inevitably have an impact on the environment. Tent camps are the least disruptive of the natural site. “We disturb as little ground as possible. We build from the ground up and put down wooden ﬂoors. We try not to have to level or disrupt any ground,” says Smith. At Red Dog, “We carefully monitor www.akbizmag.com

our level of waste and use of water,” says Fox. “Our conservation efforts are across the board—we are always being mindful of our impact on the environment. It is one of our core values.”  Louise Freeman is an editor and a writer in Anchorage. April 2014 | Alaska Business Monthly

special section

Conventions & Corporate Travel

ECONOMIC IMPACT OF CVBS Attracting travelers to communities By Julie Stricker

Lions USA Canada Leadership Forum: The Lions USA Canada Leadership Forum was held at the Dena’ina Civic and Convention Center in 2011.

hen people think about visiting Alaska, they want to see mountains, glaciers, and wildlife. Good enough. Which mountains? How do they get to close to a glacier safely, or where can they view bears? What else is there to see and do? This is where Alaska’s convention and visitors bureaus come in. “First and foremost, our mission is to attract visitors to our region, our city, and our state,” says Jack Bonney, public

Alaska Business Monthly | April 2014

relations manager for Visit Anchorage. “We’re trying to reach more travelers early in the decision-making process. We want them to spend more time in Anchorage. We want to wow them with all the things to do here.” Visit Anchorage, formerly called the Anchorage Convention and Visitors Bureau, was created in 1975 to help stimulate tourism growth and diversify Alaska’s economy. It is funded primarily through Anchorage’s bed tax and receives no state

or federal funds. Visit Anchorage, along with Explore Fairbanks (formerly called the Fairbanks Convention and Visitors Bureau), the Juneau Convention and Visitors Bureau (Juneau CVB), and numerous smaller similar organizations throughout the state, are integral pieces of one of Alaska’s largest industries: tourism.

Boosting Economies Between May 2011 and April 2012, more than 1.82 million people visited Alaska, www.akbizmag.com

ENHANCE YOUR TEAM’S PERSPECTIVE

Photo courtesy of Roy Neese

accounting for an economic impact of $3.72 billion and forty-five thousand jobs at peak season, according to a study published in February 2013 by the McDowell Group, Inc. for the Alaska Division of Economic Development. Southeast Alaska saw about 1.06 million cruise ship visitors in that time period, and about half of visitors spend time in Anchorage. About four hundred thousand travelers venture up to Fairbanks. The average visitor spent $948, not counting transportation to and from the state. Cruise visitors spent less, about www.akbizmag.com

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Attendees enjoy a job fair in Centennial Hall’s ballroom space. Photo courtesy of Juneau Convention & Visitors Bureau

$632 per person, but make up a larger piece of the Southeast Alaska economy. The primary goal of the visitor bureaus is to boost their local economies by attracting travelers and lengthening their stay, which helps both local businesses, through consumer spending, and communities, through bed tax payments. “Our mission is to market and enhance Juneau so people want to come here and stay for several days,” says Nancy Woizeschke, president and CEO of the Juneau CVB. “Most of the iconic things that most people think about Alaska are very close by in Juneau,” Woizeschke says. “In a few minutes, you can go from salmon fishing in the ocean to hiking at the top of a mountain. Bears, whales, icebergs… you can see everything that’s spectacular about Alaska.” Getting the word out about what Alaska has to offer—as well as when, where, how, and how much—is a multifaceted task, complicated by everchanging methods of communication and online technologies. “It’s a strongly multipronged approach,” Bonney says. Common tools are printed visitors guides and websites, as well as social media via Facebook, 58

Alaska Business Monthly | April 2014

Twitter, and Pinterest. The organization also maintains a visitors’ center where travelers can get information face-toface with knowledgeable people. Bonney says he also works extensively with the media and with travel writers, and the groups work with travel agents in the Lower 48 and overseas to make sure they are informed about Alaska and can inform their clients about the state. “There’s a lot of things we have our fingers in that the consumer might not attribute to us, advertisements, PR, outreach,” says Deb Hickok, president and CEO of Explore Fairbanks.

Broadcasting Alaska In October, the state of Alaska also announced it was airing commercials on broadcast television for the first time since 1982. The commercials give a broad overview of Alaska and its mountains, glaciers, and wildlife, and encourage those who are thinking about visiting Alaska to do it now. It’s a multimillion-dollar campaign that the regional bureaus can’t match, but that serves as a good starting point for more specific advice on local destinations. “The state of Alaska is really the big

dog on the block,” says Amy Geiger, staff liaison for Explore Fairbanks. “We can’t compete with what they’ve got, but we definitely piggyback. We have our fingers on the pulse of what’s happening in Fairbanks.” The regional bureaus are a voice for local businesses, as well, Geiger says. “We’re like the overall marketers [for Fairbanks]. We market for everybody to get people here. If you are a small business, you really have no voice.” Explore Fairbanks works with TripAdvisor, which allows small businesses to advertise through Explore Fairbanks in a way they wouldn’t be able to otherwise. Visitors’ bureaus also help local businesses leverage new technology. Even the recent spate of Alaska-themed television shows are another tool the visitors’ bureaus use to market Alaska. “It’s an interesting dichotomy,” Bonney says. While some of the shows are wildly inaccurate, they may spark an interest in Alaska by someone who sees a spectacular aerial photo or scenes of fishing that entice them to want to see those things up close and personal. The television shows are good at keeping Alaska upmost in people’s minds, says Woizeschke. “That alone is www.akbizmag.com

great,” she says. “What I would love is for everyone who has seen one of those reality shows to come up and see what Alaska reality really is.”

Marketing Conventions The “convention” part of the title is another big part of the group’s marketing efforts. In Juneau, Centennial Hall is the local convention center. It is centrally located in downtown Juneau and can hold up one thousand people for a reception or five hundred for a sit-down dinner, Woizeschke says. Local hotels also have meeting facilities for groups or organizations who want everything under one roof. The impact of a large convention can be significant. The Juneau CVB estimates that a meeting with a total attendance of 250 people and a threenight stay will bring in $302,530. Even a small meeting with about 15 attendees is likely to bring in about $14,400. Woizeschke estimates the economic impact of group sales adds up to $1.8 million in Juneau CVB leads in 2012 and $2.3 million in 2013. That’s an encouraging forecast, very different from a bleak outlook after the Great Recession a few years back. “We’ve been fortunate to see steady, relatively small growth since the bottom fell out,” she says. “People are cautiously optimistic.” In Anchorage, that impact of conventions is exponentially larger. Alaska’s largest city has two major meeting centers, the Dena’ina Civic and Convention Center and the Egan Center, which are located within blocks of each other in downtown Anchorage. In an average month, about sixty community events, from the “Oxygen and Octane Expo” to holiday bazaars to Anchorage Chamber of Commerce meetings are held in Anchorage. The Dena’ina Center encompasses two hundred thousand square feet. When it opened in 2008, it increased Anchorage’s convention capacity by 300 percent. “If you look at it from a pure delegate standpoint, we can host up to five thousand delegates between the two centers,” Bonney says. “The Dena’ina Center really gave us the opportunity to go after conventions that were too big for us to go after before. We can hold two meetings simultaneously. It really opens up a lot of options to custom-tailor events.” www.akbizmag.com

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In Fairbanks, the Carlson Center is the primary venue for large meetings, trade shows, and events, with other facilities available at the Westmark Fairbanks Hotel and Conference Center. In October, the Carlson Center played host to the Alaska Federation of Natives (AFN), the state’s largest gathering of Alaska Native people. Ann Renfrew of Explore Fairbanks spearheaded the effort to bring the convention to Fairbanks. While Fairbanks doesn’t offer the ﬂight connections, shopping, and other big-city amenities of Anchorage, which usually hosts the convention, Renfrew focused on the community effort Fairbanks puts into the event. As a result, AFN voted to move the convention to Fairbanks, which has hosted the gathering only three times previously. AFN annually draws more than four thousand people from across the state with an estimated economic impact of more than $4 million.

Highlighting Amenities Alaska Native culture is a consistent draw to the state, although it some-

Alaska Business Monthly | April 2014

The Northern Lights over Fairbanks. Local hotels offer Northern Lights wake-up calls for visitors who don’t want to miss the action. Photo courtesy of Hogue/Explore Fairbanks

times means travelers have to experience it to appreciate it. Alaska visitors polled after their visit to the state are asked what aspect of Alaska impressed them the most. For most, it’s Alaska Native culture, which is something that wasn’t really on their radar when they headed north, Bonney says. That provides Visit Anchorage impetus to promote destinations such as the Alaska Native Heritage Center. In Fairbanks, Alaska Native culture is a consistent draw, and the Morris Thompson Cultural and Visitors Center

gives a snapshot of Alaska Native diversity, as well as a glimpse of Interior Alaska’s rich natural history. “I think people come up here without realizing the diversity of the Native cultures,” Geiger says. They think in terms of Eskimo without realizing the diversity of Yup’ik and Inupiaq cultures or that there’s a very large and diverse Athabascan culture in Interior Alaska. While each of the state’s largest visitors’ bureaus can boast of access to mountains, glaciers, and wildlife, each offers very different amenities, which

www.akbizmag.com

‘Trifecta of Events’ “Winter is the trifecta of events that make a huge impact on luring people up here,” Geiger says. “There’s the au-

rora, which is the big piece, then ice sculptures, and dog mushing.” Seeing the aurora and visiting the Arctic Circle are two things potential visitors say are on their bucket lists, so Fairbanks’s location, 160 miles south of the Arctic Circle, is a draw for many. “Fairbanks has a lot of these sorts of ‘out of the ballpark’ things,” Geiger says. Thanks to Fairbanks’s position beneath the oval “aurora belt,” it is one of the best places on the planet to see the aurora borealis, or northern lights, Geiger says. Japan Airlines charters several direct flights to Fairbanks in the winter because of high interest in the aurora. “If you’re here for three or more days [in the winter], you’ve got a 90 percent chance of seeing the aurora if you’re persistent and can stay up all night,” Geiger says. In the summer, the endless sunlight and endless wilderness draw many Europeans, especially Germans and Austrians. Explore Fairbanks has a German agent for that reason. “The other big aspect to Fairbanks is just the wilderness factor,” Geiger says.

“We really have a heck of a lot of wilderness and we’re kind of an island in a sea of trees. I think that’s a big lure for people.” Fairbanks is a hub for adventure travelers, “a gateway hub to a lot of other cool destinations,” such as Denali National Park or Arctic Alaska, Geiger says. Although far different, Anchorage is a hub for travelers, who arrive via plane, cruise ship, and the highway, says Bonney. They want to see Portage Glacier, the Alaska Wildlife Conservation Center, go for a hike in Chugach State Park, or ride the Alaska Railroad to Denali National Park and Preserve. The possibilities are endless, from things to see and do in an afternoon to treks that take weeks or months. “You really get a mix of people who want to get out and see a lot of things,” he says. “It really does boil back down to the glaciers, mountains, and wildlife.”  Julie Stricker is a journalist living near Fairbanks.

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the individual bureaus highlight to potential travelers. In Southeast Alaska, tourism accounts for 21 percent of jobs. Most tourists arrive via cruise ships, about 1 million in 2013. Woizeschke says the most popular attraction is Mendenhall Glacier, which is easily accessible. She also likes to recommend the tram that goes halfway up Mount Roberts, just behind downtown Juneau. “The tram gives incredible vistas up and down the channel,” she says. “It gives people a feel for the immensity of the place.” In Fairbanks, the hospitality provides about 11 percent of jobs, according to the Alaska Department of Labor. While the bulk of tourism in Alaska occurs between May and September, Fairbanks can boast of a growing winter tourism industry, since snow and ice are all but guaranteed for six months of the year.

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special section

Conventions & Corporate Travel

Corporate Travel in Alaska

Photo by Crystal Javier

USTravel’s John Moriarty.

Rich in private, commercial, and collaborative options for business travelers By Tom Anderson

usiness executives in the Lower 48 states with meetings to attend, whether in a community within the state or in another continental state, enjoy ease in booking a private or commercial flight, a rental car or executive limo service, or even a train to promptly make the destination. The processes are fairly straightforward and accessible, options of transport abound, and everything seems to flow without major obstacles and in light of many alternatives. Juxtapose standard US travel to the weather rigors and geographic complexity in Alaska, and suddenly it is

Alaska Business Monthly | April 2014

clear why managed travel companies and customer service representatives for flight, vehicle, and waterway travel earn their money. Think fog, high winds, and ice storms—and then add large pesky mountains in the way when trying to get somewhere. Even the United States Environmental Protection Agency’s website states, “Alaska is a huge state with a wide range of climatic and ecological conditions.” In Alaska, “Your flight has been canceled because of weather,” is truly part of aviation nomenclature.

When it comes to traveling city to city in the 49th state, if the communities are along the road system, options for businesses spread across the spectrum. The most popular is a regional air service or a national air carrier like Alaska Airlines. If time is not of the essence, which would be rare in standard business practices that value and assiduously track time spent commuting, options such as a rental car, executive transport service (bus, limo, or car/ truck), and even the Alaska Railroad can get corporate employees and guests to and from meetings and events. Travwww.akbizmag.com

eling in the Southeast region between coastal communities, if there’s extra time, the Alaska Marine Highway System is an option. It has been operating year-round since 1963, servicing more than thirty communities in Alaska and, in the past ten years, carrying an average of 312,000 passengers and 98,000 vehicles per year. But how does one book a flight or rental vehicle or seat on a ferry? Perhaps more important, what is the easiest way to manage corporate travel in such a weather-fickle state?

Travel Management Corporations in Alaska recognize the value of hands-on travel management. Corporate management typically assigns internal staff to supervise and secure travel logistics themselves or outsources to a travel company whereby the corporate staff member serves as a liaison to the travel consultant in contouring the right itinerary. A fortune for many corporate logisticians is the blossoming acclimation to Internet and online travel bookings and resources. No matter the mechanical

medium chosen to travel on in Alaska, digital ease and access make some aspects of executive travel more efficient. Most companies’ staff members assigned to handling travel scheduling can utilize burgeoning travel websites like Orbitz, Kayak, Travelocity, Priceline, Expedia, and others that include free travel apps to access and manipulate flight details online via mobile or Wi-Fi connections. But Scott McMurren, author of the monthly Alaska Travelgram eNewsletter and a thirty-plus year tourism business owner and Alaska travel expert, cautions not to overvalue website handholding. “It’s counter-intuitive. The prevailing wisdom is that you’ll find access to travel booking and resource options online, but in practice, most of the larger Alaskan companies are reaching out to the experts within a travel management company to oversee their travel planning.” For the in-state, national, and international corporate executives who deem Alaska a tricky playing field because of travel limitations, as McMurren contends, a travel management company, or TMC, may be the most prudent and shareholder-responsible option.

There are certainly vacation travel agencies still operating in Alaska from Anchorage to Fairbanks and across the state. There are the competitive national companies like Carlson Wagonlit, originally founded in 1872 by a Belgian innovator named Georges Nagelmackers and primarily European-centric, that oversees international travel planning for many corporations.

Locally Owned The crown jewel of TMCs in Alaska is locally owned USTravel. For businesses and companies requiring managed assistance with their corporate traveling and outreach, USTravel has more than thirty years of extensive experience with intra-state travel planning for the oil and gas industry, the fisheries industry, Alaska Native corporations, and the State of Alaska. In addition to longevity, the company employs about 150 travel professionals and has six offices in Alaska, seven out of state. The company headquarters is in Anchorage. When asked just how wide and far the company’s services cover, USTravel Marketing Manager Elizabeth Nerland ex-

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Alaska Business Monthly | April 2014

plains, “Our travel agent team is familiar with booking scheduled air carriers, both domestic and international, as well as approximately $15 million in rural carrier travel every year. We have intimate knowledge of statewide rural carriers’ schedules and routes, the Alaska ferry system, rail services, charter, and remote lodging to service our clients’ intra-state travel needs, and we recognize these travel logistics are critical for any corporation’s bottom line.” One unique bragging point for USTravel is its proprietary tracking mechanism for travel on rural Alaska carriers not available in the GDS (global distribution system). The company’s tracking system includes a database of 374 city pairs and 58 non-arc rural air carriers. While their agents still contact the carrier directly to make the reservation, the system creates the itinerary, the invoice, and the reporting mechanism to complete the reservation. By interfacing the booking data from the database to the GDS, USTravel is able to give each business client a full travel picture that includes all non-arc travel segments on their aggregated expenditure reports.

Trending Logistics But how about the latest and greatest travel trending—is Alaska lagging behind on the information highway? Absolutely not, says McMurren. “Alaska is parallel with, if not superior, in our access to and application of digital mediums to benefit travel logistics,” says McMurren. “The Alaskan corporate trending in 2014 and beyond utilizes devices like iPads and tablets, smartphones and laptops, and comprehensive apps to ensure efficiency in the process. TMCs and travel consultants, in concert with modern digital technology for metrics and transparency, most often results in a happy customer who actually makes the appointment and can justify the expense.” There are certainly other considerations when it comes to corporate travel and process. Accommodations are a necessary part of the calculus. Alaska, and not just in the larger cities like Anchorage, Fairbanks, and Juneau, offers an impressive mosaic of corporate apartments, hotels, motels, bed and breakfasts, and myriad alternatives for the weary business traveler. For the adventurous employee traveler who seeks a reasonable price along

with privacy and mobility, during the summer an all-in-one option of a recreational vehicle, such as a motorhome or pickup camper, may even generate a true “Alaska” feel and afford nights in a campground or national park in between meetings, mergers, and negotiations.

Private Jets For businesses with the financial means, private jets are the opposite spectrum to the frugal corporate spenders. Although held tight to the vest when it comes to plane information and travel details, some notable Alaskan physicians and healthcare providers, construction contractors, financial institution CEOs, resource development companies, telecommunications providers, and Alaska Native corporations contract or own private jets utilized for business travel. Outof-state private jet companies are also available for corporate business travel to and from Alaska and in-state, but all at a heavy price that primarily only pinnacle income earners can afford. McMurren also highlights the fact that in Alaska exclusive charter flights with carriers are also available, most prevalent with oil and gas companies to the North Slope. He references Trident Seafood using the same method to bring its crews to Dutch Harbor and adds that planes can be retro-fitted for corporations to transport personnel and equipment, such as Northern Air Cargo accommodating Shell Oil. Welcome to Alaska and travel diversity. As Nerland admits, when it comes to Alaska and corporate travel, “We live in Alaska because we love the people, places, and environment, but it’s certainly a state that comes with some logistics challenges. Corporations and their travelers need state-of-the-art technology with a balance of human assistance to make sure they can get their job done. That’s where companies like USTravel, consultants like Scott McMurren, and the majority of agencies in the Alaska corporate travel industry meet the mark of exceptionalism.” Indeed, with planes, trains, and automobiles, and even with a backpack and tent, Alaska is open for business and accessible thanks in large part to dedicated corporate travel professionals.  Tom Anderson writes from Alaska. www.akbizmag.com

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special section

Conventions & Corporate Travel

Conventions in Alaska Taking the one-on-one approach

Golden Heart Greeter volunteers welcoming Alaska Federation of Native (AFN) convention attendees.

By Vanessa Orr

lanning a convention takes a lot of work, and one of the first and often most difficult decisions for a meeting planner is where it should be held. While San Diego, Las Vegas, Orlando, and Washington, DC, might immediately come to mind, some planners choose to travel to the Last Frontier—as long as they have a lot of help. “Nobody wakes up and says, ‘I’ll take my meeting to Alaska,’” laughs Julie Dodds, director of convention sales for Visit Anchorage. “Everyone wants to come here, but meeting planners don’t think of us in the same way that they consider other convention cities. “We have a lot of misconceptions to overcome—they say, ‘It’s too far, it’s too cold, it’s too expensive’—but none of these things are true,” she adds. “It’s our job to educate them.”

Taking a Personal Approach While meeting planning guides and travel brochures provide good information, there’s nothing more important than one-on-one relationships with out-of-state meeting planners to help convince them to come to the 49th state. Convention and visitors’ bureau staff also target groups within the state and the Pacific Northwest that have rotating meetings or that hold annual conventions within the region. “Sixty percent of our meeting business comes from within the state of Alaska, which is our biggest client—our bread and butter,” Dodds says. “This is true with most states, and with Anchorage being the largest city in the state with the most facilities, we do 66

Alaska Business Monthly | April 2014

Photo courtesy of Hogue/Explore Fairbanks

attract a large number of these groups.” Visit Anchorage (Anchorage Convention and Visitors Bureau) has six national sales managers on staff that make individual appointments with association meeting planners, host luncheons, and attend tradeshows all over the nation. The bureau also hosts three FAM (familiarization) tours—one during the Iditarod, one in May, and one in fall—to bring meeting planners and decision makers into Anchorage. “We want to educate them on why Anchorage is a great place to hold a meeting,” Dodds says. “We need to show them what we can do and the services that we can provide, because no one will book a city that they haven’t seen first.” Juneau and Fairbanks also benefit from taking the one-on-one approach. “We do a lot of research, looking into the associations in Alaska and the Pacific Northwest who meet in this area, and work to establish person-to-person contact with their decision makers,” says Liz Perry, convention sales manager, Juneau Convention and Visitors Bureau. “We bring them up for a site visit to get a feel for the city and to see the facilities we have available. It’s all about developing long-term relationships.” According to Helen Renfrew, director

of meetings and conventions, Explore Fairbanks (Fairbanks Convention and Visitors Bureau), the organization does outreach into the Juneau and Anchorage markets through direct sales calls, sales missions and luncheons in order to keep Fairbanks top-of-mind with meeting planners. “We also partner with the University of Fairbanks because many of our international events—such as Arctic circumpolar meetings and scientific meetings—originate with the university,” she explains. Fairbanks is also rather unique in that they rely heavily on local Fairbanksians to serve as meeting ambassadors. “We have found that it is very costeffective to leverage the relationships that they have,” Renfrew says. “Our Golden Heart Meeting Ambassadors were responsible for bringing twentytwo meetings to Fairbanks in 2013; in fact, at an upcoming banquet, we will be honoring thirty Gold Heart meeting ambassadors who are responsible for bringing fourteen thousand room nights and $6.7 million in direct attendee spending to the city in 2013. “We really rely on locals to spread the word, because we’ve found that a personalized invitation from someone in a group or association helps convince www.akbizmag.com

Photo courtesy of Roy Neese

Photo courtesy of Juneau Convention & Visitors Bureau

Totem poles mark the entrances to Juneau’s Centennial Hall. Mt. Juneau is seen in the background.

them to come to Fairbanks,” she adds. “Of course, we also offer a lot of support; we put an RFP [request for proposal] out to hotels to gather the information that the planner needs, as well as provide a meeting planning guide that gives them access to local contacts and a checklist of things to consider. A lot of meeting planners are volunteers or have other jobs; we find that it helps if we translate the information for them.”

Perception vs. Reality In order to get a meeting planner to even consider Alaska as a convention or meeting destination, convention sales staff must first overcome a lot of misconceptions. Challenges range from the idea that the state is always cold and dark to the fact that it is considered too expensive or difficult to reach. “In a survey done last year of national meeting planners, it showed that our challenges are also considered plusses; for example, we are thought of as far away, but exotic,” Dodds says. “Once we show meeting planners how easy we are to get to and that we have a lot of hotels and services, and that we are actually quite affordable, it all adds up.” Dodds cites the fact that while Anchorage may be considered a secondtier city by meeting planners, it has a first-tier airport. The city boasts four major convention hotels—the Hilton, Marriott, Sheraton, and Hotel Captain Cook—and two convention centers, the William A. Egan Civic and Convention Center and the Dena’ina Civic and Convention Center, which is less than six years old and features a fift y thousandsquare-foot exhibit hall and twenty-five thousand-square-foot banquet hall. “The buildings are configured differently and can be tailored depending on a group’s size and needs,” Dodds says. www.akbizmag.com

The Dena’ina Civic and Convention Center in Anchorage features a ﬁfty thousandsquare-foot exhibit hall and a twenty-ﬁve thousand-square-foot banquet hall.

“Because we have no city or state sales tax, it also makes a visit to Anchorage quite affordable,” she adds. “To stay in a hotel in a major convention city like Washington, DC, can cost $299 to $399 a night. Our rates are much lower. Because we have no sales tax, food and beverages cost less; a gallon of coffee costs $34 at our convention center versus $60 to $85 in other cities. Meeting planners hear these statistics and get very excited.” According to Perry, a lot of planners believe that they will be priced out of coming to Alaska, but it is well within the budgets of groups meeting in the Pacific Northwest. “If they can meet in Hawaii as a regional organization, they can meet in Juneau,” she says. “Because we’re just two hours north of Seattle, logistics are not a problem. We are serviced by Alaska Air, and Delta Airlines will be making runs during the summer. And we have a really good working relationship with Alaska Air; if there are twenty-five or more with a group, we can request a discount code for them.” Juneau can host groups of up to five hundred people in hotels downtown and in its Centennial Hall Convention Center. “We have a great municipal transit system and we can arrange contract transportation if needed,” Perry says. “The downtown hotels are all within very easy walking distance of Centennial Hall; usually three blocks or less. And Juneau is also a very safe city—they can walk around downtown day or night.” Fairbanks, a forty-minute jaunt from Anchorage by plane, is also an affordable option for meeting planners. “In

the fall, spring, and winter months— our opportunity season—prices are very competitive, which more than makes up for the additional flight from Anchorage,” says Renfrew. “When you go to big meetings Outside, you pay for parking and so much more. We have ample free parking here, our hotel and catering costs are very reasonable, and we have a very supportive tax structure, while still providing for all of the needs of meeting planners.” Fairbanks is currently in the process of doing a feasibility study to determine the need for a convention center, but in the meantime holds events on the UAF campus and in its larger hotel facilities, which includes seventeen thousand square feet of space at the Westmark Fairbanks Hotel and Conference Center. “I think visitors appreciate Fairbanks’ small-town feel and phenomenal events, which include the BP World Ice Art Championships and the Yukon Quest,” Renfrew says. “And because Fairbanks sits in an auroral oval, we also have fantastic Northern lights viewing—in fact, our hotels even offer Northern Lights’ wake-up calls.”

Unlike Anywhere Else on Earth According to Vicki Glass, director of meetings and membership, National Association of Development Organizations, coming to Alaska was a win-win situation for the organization and its members. “The first time I chose Anchorage, I was skeptical and nervous because it was so out of the norm,” says Glass, who held April 2014 | Alaska Business Monthly

two training conferences in the state in 1997 and 2007 and plans to bring approximately seven hundred people back in 2017. “One of the reasons I chose it was because of the great team at the Anchorage CVB; they are good sales people without being too pushy. Jim Henderson flew down to our board meeting and did a presentation that got everyone engaged. He just wowed them! “There were a lot of advantages—it costs a lot less than you think, especially once you get there, and we got great values on flights,” she adds. “It is so beautiful and so unusual that when you get the opportunity, you just have to go.” Professor Jeffrey Miller helped to organize four different conferences in Anchorage for the IEEE (Institute of Electrical and Electronics Engineers) in 2009, 2010, 2011, and 2012 with attendance numbers ranging from 600 to 1,500. “Anchorage was chosen because of its appeal to the committee; the state is mysterious and has a lot of appeal, especially nowadays with many TV shows and other advertising,” he explains. “In addition, I had a tremendous amount of support from other people within the

Alaska Business Monthly | April 2014

professional societies and from the city to make the bid much easier. The support from the industry and local volunteers can’t be rivaled in other cities.” In 2012, Anchorage had its biggest meeting and convention year ever, resulting in a $104 million economic impact. “We’re feeling very positive about the next few years; 2014 looks to be as strong as 2012,” Dodds says. “We just got word about a group booking for 2020, and we also have some meetings already in the book for 2017 and 2018.” An added bonus from these bookings is that people who attend a conference or meeting in Alaska tend to stay longer in order to enjoy all that the state has to offer. “Many people who attended our conference made vacations out of it,” Miller says. “They didn’t come just for the conference but came for more days before or after as well.” “Conferences in Anchorage often break attendance records, and almost always break spousal/family records,” Dodds adds. “Part of our job is to get visitors to stay more days, and we rely on our members to do this. Our members have access to our convention calendar,

so they can contact these groups to offer specials during their stays—for example, if you show your convention badge, you get 10 percent off a day cruise.” The result is that even more people will visit Alaskan cities and in turn, tell other meeting planners and organizations. “Once they’ve been here and experienced Juneau, and seen how easy it is to get business done, it’s easy for us to get referrals to other organizations and to get word out through the grapevine,” Perry says. And every bit helps, considering that it can take anywhere from six months for a smaller meeting to book a venue to years after the initial meeting. “Sometimes you meet someone at a trade show, and two years later, they’re here,” Dodds says. “But I met one meeting planner who had just had twins; that group came to Anchorage when the twins were sixteen. I stayed in touch— those kids had every stuffed animal from Alaska that you can imagine.”  Vanessa Orr is the former editor of the Capital City Weekly in Juneau.

www.akbizmag.com

AGENDA April

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Top 40 Under 40

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April 4—Dena’ina Center, Anchorage: Sponsored by the Alaska Journal of Commerce, this event is a recognition of the state’s top young professionals younger than the age of forty who have demonstrated professional excellence and a commitment to community. alaskajournal.com

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Visit Anchorage Annual Seymour Awards Banquet April 11—Dena’ina Center, Anchorage: A celebration of the industry’s successes of the past year. Special award presentations will be made to Visit Anchorage partners whose exceptional efforts have made these achievements possible. anchorage.net

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ComFish Alaska April 17-19—Port of Kodiak, Kodiak: This is Alaska’s longest running, premier commercial fisheries trade show. comfishalaska.com

Seismological Society of America Annual Meeting

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April 30-May 2—Egan Center, Anchorage: A stimulating exchange of research on a wide range of topics with colleagues from all over the world. Oral presentations, poster sessions, exhibits, field trips, business meetings, and social gatherings all provide participants the opportunity to meet and share with their peers. seismosoc.org

Business of Clean Energy in Alaska Conference May 1-2—Dena’ina Center, Anchorage: The conference provides a venue for attendees to learn about and share information on the opportunities, benefits, and challenges of renewable energy and energy efficiency in Alaska and to network with those working in these fields. bceaconference.com

Alaska Bar Convention May 7-9—Dena’ina Center, Anchorage: This conference provides opportunities to complete CLE requirements as well as an opening reception, several luncheons, and an awards reception and Dinner for 25, 50, and 60 year recognition. alaskabar.org

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Alaska Earthquake and Tsunami, and an undergraduate seismic design competition. The conference, on the 50th Anniversary of the Great Alaska Earthquake and Tsunami, will provide an opportunity for researchers and practitioners to share the latest knowledge and techniques to mitigate the damaging effects of earthquakes and tsunamis. 10ncee.org | eeri.org

Joint International Geological Correlation Programme (IGCP) 588 and SAA Meeting May 3-10—A weeklong combined conference-fieldtrip in the 50th anniversary year of the 1964 Mw9.2 Good Friday earthquake. We will visit sites which experienced coseismic deformation during 1964, but also record late Holocene paleosiemiscity and add to an increasing knowledge of seismic and tsunami hazard along the Aleutian megathrust. coastal-change.org

AMA 24th Biennial Mining Conference April 7-13—Carlson Center, Fairbanks: “Growing Alaska: Can you dig it? Catch my drift?” is theme of the Alaska Miners Association 2014 conference. There will be technical sessions, short courses, a trade show, and field trips to local mines/projects. alaskaminers.org

May

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Compiled by Tasha Anderson

Alaska State HR Conference

August 2014

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May 12-13—Sheraton Hotel, Anchorage: Meet more than two hundred human resources professionals, office managers and administrators, directors, and adult educators representing both public and private industry. This event will bring professionals from around the state to learn more about their responsibilities as HR Professionals. alaska.shrm.org

NACo WIR Conference May 21-23—Egan Civic and Convention Center, Anchorage: The National Association of Counties’ Western Interstate Region conference focuses on public lands and issues critical to the western region of the United States, providing county officials with the opportunity to hear speakers, discuss legislation, and network with other officials. naco.org

International HETL Conference May 31-June 2—Anchorage: The theme of this year’s conference for the Higher Education Teaching & Learning Portal is “Innovative Learning-Scapes: e-Scapes, play-Scapes and more.” The aim is to examine the impacts that social and mobile media and networks are having on learning environments in higher education. hetl.org

September 2014

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June

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National Congress of American Indians (NCAI) Mid-Year Conference June 8-11—Dena’ina Civic Center, Anchorage: The National Congress of American Indians, founded in 1944, is an American Indian and Alaska Native organization serving the broad interests of tribal governments and communities. ncai.org

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July 20-26—Dena’ina Center, Anchorage: This conference is comprised of the 2014 EERI (Earthquake Engineering Research Institute) Annual Meeting and the NEES (Network for Earthquake Engineering Simulation) Quake Summit, as well as the 10th Anniversary of NEES, the 50th Anniversary of the 1964

Alaska Oil & Gas Congress September 15-18—Anchorage: This comprehensive four day conference is the place to meet the players, forge new relationships, and get the information you need to capitalize on changes taking place in Alaska. This year is the 10th anniversary event and planning is already underway to make it a memorable and valuable experience. alaskaoilandgascongress.com

Rural Energy Conference September 23-25—Fairbanks: A three day event offering a large variety of technical sessions covering new and ongoing energy projects in Alaska, as well as new technologies and needs for Alaska’s remote communities. akruralenergy.org

Alaska Coalition on Housing and Homelessness Conference September 30-October 2—Anchorage: Events include keynote speakers and training sessions. alaskahousing-homeless.org/conference

Alaska Community Transit/ Department of Transportation Conference September 30-October 2—Millennium Alaskan Hotel, Anchorage: This annual conference address transportation information and issues around the state. act-dot.com

July US National Conference of Earthquake Engineering

IEA World Congress of Epidemiology August 17-21—Dena’ina Center, Anchorage: The theme for this year’s congress is “Global Epidemiology in a Changing Environment: The Circumpolar Perspective.” The congress is an opportunity to visit with and listen to prominent researchers in epidemiology and public health. ieaweb.org

October 2013

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Alaska Business Monthly’s Top 49ers Luncheon October 1—Dena’ina Center, Anchorage: Come to our annual luncheon and honor the Top 49 companies owned and operated by Alaskans, and ranked by gross revenues. Contact: Melinda Schwab | 907-276-4373 | accounts@akbizmag.com • akbizmag.com

April 2014 | Alaska Business Monthly

TELECOM & TECHNOLOGY

Businesses Leverage Cloud, Wireless, and Internet Photos courtesy GCI

Improving efﬁciency, expanding capabilities with telecom solutions By Tracy Barbour

s technology evolves, businesses in Alaska are taking advantage of an array of solutions to enhance their efficiency, productivity, and overall work environment. They’re employing cloud-based, wireless, Internet, and managed solutions to expand their communications, computing, and data storage capabilities. Alaska’s telecommunications and technology companies offer a myriad of products and services to meet their needs. GCI Product Manager JR Garcia says Alaska is typically three or four years behind other states as far as technology adoption. However, cloud computing is starting to catch on now due, in part, to the advertising surrounding the technology. About a year ago, GCI launched a regional cloud computing product that

Alaska Business Monthly | April 2014

Above and Top: GCI’s Anchorage data center at 6831 Arctic Boulevard. www.akbizmag.com

Photo courtesy AT&T

Electa Keane, sales manager at AT&T Alaska. 72

Alaska Business Monthly | April 2014

Photo courtesy GCI

was designed with Alaskans in mind. The cloud-based option allows businesses to store their data offsite and have lower latency (processing delays) and local support. Customers’ data is physically housed at GCI’s state-of-the-art data center and backed up in locations in the Lower 48. “That local connectivity is helpful,” Garcia says. “Customers can drive over to the data center and pick up a backup copy of their data if they need it.” In general, cloud services can result in a 25 percent to 30 percent savings over five years, Garcia says. This makes them ideal for smaller businesses with tighter technology budgets and limited IT staff. Larger companies are using GCI’s equipment co-location service. They can bring in their equipment and have it securely hosted at the company’s ten thousand-square-foot data center. “We give them a cabinet and provide all the back-end infrastructure to support it,” Garcia says. GCI’s co-location and hosting services are geared for companies that have a dedicated IT staff with the expertise to manage their own equipment. Businesses of all sizes are also using GCI’s hosted telephone systems to conserve their resources. The phone system infrastructure is hosted in GCI’s cloud, which allows customer to not have to maintain hardware on site. “The only

JR Garcia, Product Manager for GCI.

thing they would have at the office would be the physical handsets,” Garcia explains. “All the brains would live in our data center.” A cloud-hosted phone system is much less expensive for companies to manage, not just from an up-front cost perspective, but from a time perspective, according to Garcia. Clients don’t have to worry about having the appropriate space, power, cooling, and other requirements to maintain a telephone system. And employees don’t have to spend their valuable time managing telephone equipment.

Wireless and Mobile Services Alaska businesses are increasingly accessing the Internet through tablets and smartphones instead of desktop computers. Consequently, GCI has more customers using wireless devices with its mobile-optimized voice, Internet, and cloud services. “All of those things need to have a mobile component because that’s where the industry is trending,” Garcia says. AT&T Alaska Sales Manager Electa Kean is also seeing Alaska businesses migrating to wireless operations and an IT-based technology. This places them in the position to be able to stack on virtually unlimited features, such as voice over Internet protocol (VOIP), voice and video conferencing, and cloud services. These services are effectively enhancing the use of technology. Without them,

companies are relegated to traditional ways of conducting business face to face. Adopting a mobile strategy helps companies empower remote workers. It allows employees to complete more activities in the field without having to report back to headquarters. For example, a heating, ventilation, and air conditioning company can use this technology to make work assignments. Instead of reporting to headquarters at the beginning of their shift, technicians can “punch” a time clock from home in their work vehicles. Then dispatchers can track their location and make assignments accordingly. As another example, remote workers can use ProntoForms and a compatible AT&T device to record data from the field wirelessly. The mobile application enables employees to transmit information to the office without having to submit a paper form, which is ideal for those working in the retail, health care, energy, property management, financial services, and education fields. “AT&T’s wireless capabilities make a company’s employees more remote and accessible, while increasing efficiency and productivity and saving money,” Kean says. As mobile technology becomes more popular, more Alaska businesses are allowing employees to bring their own devices to work. They can have the convenience of using their own laptop, tablet, or smartphone and do so with little risk to the www.akbizmag.com

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company, thanks to mobile device management solutions like AT&T’s MobileIron and AirWatch. Companies can use these applications to compartmentalize and secure their information on employees’ personal devices. “It helps businesses control expenses on their hardware,” Kean says. “And most employees don’t want to carry around multiple devices.” With AT&T’s software, a company’s data is compartmentalized on the employee’s device. So if the individual loses his phone, for instance, the organization can erase the corporate information and leave the personal information intact. The bring-your-own-device practice is an emerging trend in Alaska, Kean says. “We’re seeing it more commonly among government and education users, as well as larger businesses that have ties to the Lower 48,” she says.

Managed Solutions Organizations in Alaska are also leveraging managed options to outsource some or all of their technology solutions. AT&T offers popular managed Internet and virtual private network (VPN) solutions that facilitate the private transmission of

data over the public Internet. AT&T has secure routing tables and tunnels that define exactly where the traffic goes and give customers the assurance they need to transfer proprietary information securely to its intended destination. The customer’s information resides in Alaska, and AT&T maintains visibility of the entire network up to the customer’s premises. AT&T is keenly aware of outages, delays, and other glitches—typically before they’re detected by customers, Kean says. GCI also offers a variety of managed services to help companies stay on top of their technology needs. Besides providing managed Internet, data, cloud computing, and telephone systems, GCI has a help desk with dedicated IT professionals to serve customers around the clock. In addition, the company has a professional services group that can provide clients with on-site solutions. “We have a team of folks who monitor and maintain the customers’ networks,” Garcia says.

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Alaska Business Monthly | April 2014

At Integrated Logic, commonly-requested turnkey network solutions include VOIP, wireless, and switching. However, the infrastructure company does everything from installing cabling to network engineering. “If it runs on an IT network, we’ll take it on,” CEO Chris Johnson says. Johnson says many businesses are requesting network engineering services, including specific engineering tasks. That’s understandable, given that there is a shortage of qualified individuals in the market. Plus, it’s often not practical for a business to keep a full-time network engineer on staff. Integrated Logic is also seeing a growing demand for wireless networks. More and more, these types of deployments involve intelligent wireless solutions that can identify the type of devices that are on the network, Johnson says. Businesses are also using intelligent traffic management to increase the efficiency of how employees use their network. With intelligent traffic management, Integrated Logic helps clients determine what is really important to them in terms of how their network is utilized. Then the company helps them prioritize access to certain business applications and deprioritize non-critical apps. “It’s a more efficient use of what they’re doing,” Johnson explains. “It can help clients avoid wasting bandwidth.” Customers of Integrated Logic, which is partially owned by GCI, are also using private clouds built to their specifications. This allows businesses to capitalize on cloud technology while using their own infrastructure. “Effectively, you take a private network and put a data center in the middle,” Johnson says. “Your business intelligence lives in the data center. You get all the upside of a cloud solution with all of the availability and more finite controls as far as security.” Whether a business needs a network built from the ground up, contract engineering, or a cloud solution, Integrated Logic has engineers available to manage, design, and implement networks. The company also offers managed options with varying levels of support for businesses wanting an outsourced solution.  Former Alaskan Tracy Barbour writes from Tennessee. www.akbizmag.com

Legal Speak

By Kevin Pearson

Federal Income Tax Incentives for Alaska Businesses

pring is a hopeful time of year. As the snow begins to melt, the days begin to get longer, and evidence of living plants begins to emerge, one’s thoughts naturally turn toward summer and the possibilities it will bring. That is perhaps more true in Alaska, where the duration and darkness of the winters is legendary, than anywhere else. Unfortunately, spring also brings with it the inevitable and often painful task of preparing yet another year’s federal income tax returns. It is only fitting in this season of hope—and pain—to look to the future and think about what a business might do in the coming months to reduce its income tax liability for 2014.

Expired Credits Congress allowed to expire at the end of 2013 a significant number of popular federal income tax incentives that were available in recent years. These include the general bonus depreciation deduction, the research and development tax credit, tax credits for certain renewable energy projects, tax credits for certain biofuels, the work opportunity tax credit, mine safety-related credits, the expanded deduction for business startup expenditures, the credit for energy-efficient buildings, the special deduction for films produced primarily in the United States, and many others. Certain members of Congress have said that they intend to take up a number of these expired provisions in the near future and may extend some or all of them. This, of course, remains to be seen, and Beltway insiders differ on whether some or all of these provisions are likely to be extended. In the meantime, however, there are a few remaining federal income tax incentives that, with careful planning, could help ease next spring’s pain. This article will touch on just a few of these incentives. This article does not address all incentives that may be available to a particular person. In addition, the rules governing each of these incentives are complex and we urge readers to con-

sult with their individual tax advisors to help determine whether they qualify for and can utilize these or other incentives.

Bonus Depreciation The very popular allowance for bonus depreciation, which Congress had previously extended and modified a number of times, generally expired at the end of 2013. There remains, however, a 50 percent bonus depreciation allowance for certain qualifying aircraft placed in service before the end of 2014. To qualify for this allowance, an aircraft must meet the placed-in-service date requirement and must be used in a business that does not involve transporting persons or property (except for agricultural or firefighting purposes). In addition, the taxpayer seeking the bonus depreciation deduction must be the original user of the aircraft, and the aircraft must cost at least $200,000 and have an estimated production period of more than four months. If these and certain other requirements are satisfied, the taxpayer may deduct half the cost of the aircraft in 2014. The remaining one-half of the cost of the aircraft can be deducted over its depreciable useful life using the normal accelerated depreciation schedule. If an aircraft qualifies for bonus depreciation, it can provide a significant benefit that can help offset the cost of a new aircraft. Renewable Energy Credits The federal income tax credits available for many types of renewable energy equipment also expired at the end of 2013. Certain credits remain, however, that could be beneficial to businesses in 2014. For example, the investment tax credit for solar energy property that is placed in service during the year remains in effect for 2014. The credit generally is equal to 30 percent of the cost of the qualifying equipment. To qualify for the credit, the equipment must use solar energy to generate electricity, to heat or cool (or

provide hot water for use in) a structure, to provide solar process heat, or to light the inside of a structure using fiber-optic distributed sunlight. A similar 10 percent credit exists for qualified fuel cell property, combined heat and power system property, and equipment used to produce, distribute, or use energy derived from a geothermal deposit. These credits are direct credits against federal income tax owed, rather than deductions or other reductions in taxable income. Although the credits are not refundable, if a taxpayer does not have sufficient taxable income to fully utilize the credits in 2014, they can be carried back to previous tax years and forward to subsequent tax years in certain circumstances.

Other Incentives Some of the other federal income tax incentives that currently remain in place for 2014 include an excise tax credit for liquefied hydrogen and liquefied hydrogen fuel mixtures, the alternative motor vehicle credit for qualified fuel cell motor vehicles, and the alternative fuel vehicle refueling credit for hydrogen refueling property. Any business involved in the renewable fuel industry or operating renewable fuel vehicles should consider these remaining incentives. Many taxpayers are hopeful that Congress will extend some of the business tax incentive programs in the near future. In the meantime, business owners may want to think about whether they can take advantage of any of the remaining unexpired incentives and what impact those incentives might have on business decisions.  Kevin Pearson is a tax partner at the law ﬁrm of Stoel Rives LLP. You can contact him at ktpearson@ stoel.com.

The information in this article is intended for educational purposes only. Consult your tax advisor regarding application to your business.

www.akbizmag.com

April 2014 | Alaska Business Monthly

ALASKA NATIVE CORPORATIONS

Photo courtesy of BSNC

Investing in Energy

Bering Straits Native Corporation uses solar panels on its Nome ofﬁce building.

Developing sustainability By Julie Stricker

he far-flung Aleutian Islands have been called the birthplace of the winds. It is ever present on the rocky islands, as much a part of life there as the marine life and birds that ride the currents. So when Ron Philemonoff of St. Paul saw wind turbines moving in the breezes of southern California while visiting relatives several years ago, he became interested in harnessing the much stronger winds of St. Paul island to help power the industrial complex owned by the Tanadgusix Corporation (TDX). In the process, TDX, a village corporation created under the 1971 Alaska Native Claims Settlement Act, found a niche that creates jobs and opportunities for shareholders. Philemonoff, now CEO of TDX, helped launch a successful enterprise on the remote island, a remote haven for bird-watchers. It also helps lower energy costs in a region where a gallon of diesel fuel or a gallon of milk can cost $10. And, while Fairbanks residents pay about twenty cents per kilowatt hour and Anchorage residents pay only about fourteen cents per kilowatt 76

Alaska Business Monthly | April 2014

hour, electricity rates in rural Alaska can be triple or quadruple those rates.

Ideal Combination It’s an ideal combination for Alaska Native corporations. Under ANCSA, which divided 44 million acres of land and $962.5 million among Alaska Natives who created twelve Alaska-based regional corporations and about two hundred village corporations, the corporations have a dual mandate: to provide economic opportunities for shareholders as well as to provide for their social and cultural well-being. Investing in energy-related businesses is one way they can accomplish both, says Jerald Brown, vice president of Nome operations for Bering Straits Native Corporation. “It’s a service we can provide for profit that generates revenue and profits for Bering Straits, as well as savings for the buyer, our customers,” Brown says. For instance, NANA Regional Corporation in Northwest Alaska works with RuralCAP to help shareholders improve the energy efficiency of their homes. Several villages in the region have wind turbines or are looking to build one. Hydropower may help fuel future development near promising mineral deposits on the upper Kobuk River. Hundreds of miles south, Sealaska Corporation retrofitted the boiler sys-

tem at its Juneau headquarters to run on environmentally friendly biomass. Besides saving money on energy, Sealaska hopes to expand the demand for the wood pellets used in the boiler, which would give the corporation another market for its timber resources and provide jobs for shareholders. Calista is studying the feasibility of a large hydroelectric facility at Chikuminuk Lake that would power Bethel and thirteen villages, although any construction is still years in the future.

Wind Power One technology that is already being widely used in remote areas of Alaska is wind power. Anchorage-based Cook Inlet Region, Inc. (CIRI) built a commercial size wind farm on Fire Island that supplies enough electricity to light nearly thirteen thousand homes. TDX took offthe-shelf wind technology and modified it to run in tandem with diesel to create a more robust, reliable energy system. Today, a hybrid wind/diesel system powers the St. Paul Airport Business Park and is tied in to the municipal utility system. According to TDX, the business park runs on wind 20 percent of the time, 20 percent on diesel, and the remainder on a combination of the two. In 2011, that combination realized a cost savings of $26,000 per month. www.akbizmag.com

TDX has deployed similar systems elsewhere, such as Sand Point on the Alaska Peninsula and in Deadhorse on Alaska’s North Slope. All three use a combination of wind and diesel and provide continuous generation. Subsidiary TDX Power, Inc. is an expert in small utility systems ideal for remote Alaska locations and a leader in renewable energy generation. Bering Straits has positioned itself as a leader in smart energy solutions. Its Banner Wind subsidiary, owned in partnership with village corporation Sitnasuak Native Corporation, contains eighteen turbines on Banner Peak five miles outside Nome, including two owned by the local utility. The turbines provide about 1 million kilowatt hours annually, Brown says. That power is poured into the local power grid and provides about 15 percent of the city’s annual requirements, or enough to light about 150 homes.

‘The Total Package’ The leaders of Bering Straits have been interested in alternative energy for decades, Brown says. Green Energy Solu-

www.akbizmag.com

tions, under Bering Straits’ construction subsidiary, helps customers look at the energy issue from many different angles. “It’s more than just windmills, it’s the total package,” Brown says. “We’ve got

Photos courtesy of BSNC

Banner Wind Project near Rock Creek sells power to Nome Joint Utilities.

April 2014 | Alaska Business Monthly

Bering Straits Native Corporation is investing in a wide range of energy development measures, including on Nome rooftops. Photo courtesy of BSNC

energy auditors on staff. We look at the building envelope. We look at all types of ways to lower the energy costs to the business or to the consumer.” That includes looking at whether a building needs more insulation, a tighter envelope, or new windows. It also includes alternative energy sources such as

solar or small windmills. Green Energy has worked on projects from Bethel to the North Slope and Alaska’s Interior, Brown says, including several large solar installations in the Northwest Arctic Borough. The corporation also uses solar panels to help provide electricity for its threestory, thirty-five thousand-square-foot

confident crawler cranes Lifting Alaska’s economy requires reliable, productivity-boosting power.

STG’s state-of-the-art fleet of computerized, hydraulic crawler cranes are more efficient and safer to operate on Alaska’s North Slope than conventional friction crawler cranes.

See more photos of the North Slope CD-5 project at

www.stgincorporated.com

office building in Nome. “The solar panels don’t come anywhere near supplying all the power in any point and time, but they do make a dent,” Brown says. The panels should pay for themselves in about twelve years, are under warranty for twenty-five and are expected to last for forty years, he says. “We’ll still have a long useful life with them.” Inside the building is Bering Straits’ retail center for Green Energy Solutions. They are manufacturers’ and dealers’ representatives for national companies that manufacture everything from LED lighting to windmills and solar panels. “We do sell a lot of products just as retail without the installation component, although we do that as well,” he says. Bering Straits is also involved in a geothermal project at Pilgrim Hot Springs, sixty road miles northeast of Nome. The springs is known as Unaatuq, Inc., and had been owned by the Catholic Diocese of Fairbanks and was sold in 2009 to a group of seven Nome-area organizations, including Bering Straits. Unaatuq is working with the Alaska Center for Energy and Power at the University of Alaska to determine whether

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“ My father and grandfather helped build the pipeline. Now I’m building on the Kenai — working on college housing that will develop another Alaskan resource.”

— Beau Montgomery, Bristol Alliance of Companies, Bristol Bay Native Corporation

Building Alaska’s Future

the springs will make a viable geothermal energy source for the Nome area. Studies completed in 2013 looked positive, according to ACEP, but more research is needed.

Investing in energy makes sense on several levels, she says. One is that CIRI and most of its shareholders are in Alaska and feel the crunch of high energy costs. “We also feel it is important to have diversified resources that aren’t tied to the price of fossil fuel,” Gibson says. “It’s prudent not to put all of our eggs in one basket. Obviously, we’re also focused and care about the environment and want to have energy sources that don’t emit bad things into the air.” As a business, energy also provides a reasonable rate of return. Although the Fire Island project is new, and having a project located on an island does create some difficulties, Gibson says CIRI will continue to manage it closely to ensure it will be a good investment over the long-term. CIRI also has partnerships in five wind projects in the Lower 48, two in Wyoming, two in Nebraska, and one in Texas. Together, they provide more than four hundred megawatts of windgenerated energy, Gibson says. CIRI is also thinking about investing in a utility-scale solar project in California, which is still in the early planning stages.

Commercial Scale Projects CIRI has focused on commercial scale projects, both as investments in Alaska and outside the state. Fire Island Wind LLC is a wholly owned subsidiary that operates eleven turbines in Cook Inlet. The turbines provide about fifty megawatts of power annually, all of which is sold to Chugach Electric Company under a long-term purchase agreement. The project went online in 2012 and CIRI has started construction on Phase 2, which would double the project in size. Some roads and infrastructure to the new turbine sites are under construction, but the project is waiting for a new power purchase agreement to be completed, says Suzanne Gibson, senior director of energy development for CIRI. “We’d like to get the power purchase agreement sometime this spring, get financing and start construction next year and go commercial in October 2015,” Gibson says.

A coffee table photo book of Alaska’s North Slope oil patch.

Rigging cable, Liberty

Investing in Sustainability Investment in energy projects both large and small is helping Alaska Native corporations make life in rural Alaska more affordable and more comfortable for shareholders, as well as creating jobs and generating revenue. A main goal is to help Alaska Natives be able to stay in their villages, where subsistence is a major way of life. Affordable energy is also key to developing the abundant resources in many parts of the state. It’s a way of looking forward, while holding on to tradition. Philemonoff gave a speech during the ribbon cutting ceremony for the St. Paul power plant. He noted that the wind had always been a part of life in the Aleutians. “Some say that this is where the wind is born, and some say this land is nothing but a blowhole. To the Aleut people, this is where we are born, and we welcome the wind. “Now we will catch the wind and ride it into the 21st century.”  Julie Stricker is a journalist living near Fairbanks.

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MY FAVORITE SUBJECTS ARE PEOPLE WORKING. TO ME IT DOESN’T MATTER IF THEY ARE EQUIPMENT OPERATORS, TRUCK DRIVERS, MUD MEN, DRILLERS, ROUGHNECKS, GEOLOGISTS, BULL COOKS, MECHANICS OR COMPANY PRESIDENTS — IT’S THE PEOPLE WHO ARE THE MOST INTERESTING TO ME. left Pilebuck Gary Pickus, February 2009 10

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above Eni Petroleum, Spy Island, March

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top right Deballasting after barge offload, West Dock, August 2011 bottom right Blaze Anderson, roughneck, Parker Drilling Rig 272, February 2013 next Parker Drilling Rig 272 moving crew, February 2013

135

Order your copy today at judypatrickphotography.com or call (907) 258-4704 In bookstores Spring, 2014 “If you want to really see what the industry looks like in this little-traveled and forbidding part of North America, “Arctic Oil, photographs of Alaska’s North Slope” by Judy Patrick is the best documentary you will find...”

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Alaska Business Monthly | April 2014

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OIL & GAS

The Alaska LNG Project Another natural gas partnership By Mike Bradner

nce again, a plan for the state to partner with North Slope oil and gas producers on a large North Slope natural gas project is before the Legislature. Lawmakers are being asked for permission this year to make two key changes in law that would set the stage for negotiations of a fi nal participation agreement to be brought to the Legislature next year. Two changes are needed: the fi rst is to change the current natural gas production tax from a net profi ts tax to a tax on the gross value of the gas. This is needed to make possible the second change being asked this year, to take the tax in kind, or in the form of gas instead of cash. The state already has authority to take the gas royalty in kind, the option it would exercise if the deal goes forward. The tax share and royalty share combined would be 20 to 25 percent of the gas production, the amount depending on the tax share decided by the Legislature in the 2014 session. That share of production, 20 to 25 percent, would be the share of the project the state, and its proposed pipeline company partner, TransCanada Corporation, would have in the overall project. As a part of its decisions this year, the Legislature will also give the state permission to continue negotiations toward a participation agreement with its industry partners and to fi nalize a separate deal with TransCanada for the pipeline company to be the state’s partner in its share of the project. 82

Alaska Business Monthly | April 2014

www.akbizmag.com

BusinessPROFILE

Little Red Services, Inc.

Photos courtesy of Greg Cook and Little Red Services Greg Cook, veteran of Afghanistan and Iraq Wars with captured enemy weapon, now a valued employee at a LRS hot oil truck.

he recent changes to Alaska’s oil tax policy, SB21, also known as the more Alaska Production Act, has increased investment and activity on the North Slope. This activity has already created hundreds of new jobs across the industry here in Alaska.

HIRE A VETERAN

At LRS we have seen an increase in opportunity that has generated a 10% gain in employment or 15 new jobs over the past 9 months. In our effort to fill these new positions and our normal rate of attrition, we needed 33 new employees since May of 2013. As we began to seek out good candidates for our company, we discovered that a great resource is veterans exiting the military and attending Northern Industrial Training (NIT) located in Palmer, Alaska. The veterans are attending a variety of courses from welding to commercial driver training. These veterans are proving to be an exceptional resource of personnel who bring integrity, self-discipline, teamwork, and loyalty to the workplace. In addition, they are departing an environment

where procedures, checklist, and following directions are expectations of daily work activities. This attribute sets them up quite well to be successful in an environment where Operating Discipline is essential to getting the job done right the first time and delivering incident free execution. Of the 33 new employees we have hired since May of 2013, 12 are post 9/11 veterans and most all of them have been deployed into combat zones in Iraq or Afghanistan one or more times during their service. These men served with distinction and protected us while we slept, worked, spent time with our families, and enjoyed the great outdoors of Alaska. One of our employees, Greg Cook, was also Master Sergeant Cook of the US Army. Greg served with honor and distinction for 21 years and deployed five times with Desert Shield, Desert Storm, and Enduring Freedom. Greg is now a part of our team and his positive presence is already being felt across the organization. Greg was the recipient of 2 Bronze Stars, 1 Meritorious Service Medal, 5 Army Commendation Medals, and 3 Army Achievement Medals. You can see Greg in the photos holding a captured enemy weapon and now wearing our company coveralls on the North Slope working in the BP operated field of Prudhoe Bay.

With oil tax reform we have the opportunity to see continued investment in Alaska and additional job opportunities for Alaskans and our Alaska military veterans. Alaska has benefited greatly by the presence of our military bases and we have always considered them a welcomed and essential part of our community. Veterans deserve an opportunity for meaningful employment, and they are a great fit at LRS where our position is to “Hire for Attitude and Train for Skill.”S With the planned reshaping of the military and the potential reduction of up to 1 million service members, we encourage employers to develop relationships with training facilities like NIT, organizations like Helmets to Hardhats, and the Wounded Warrior program to see how your organization can benefit by veteran hire.

Little Red Services, Inc. Doug Smith, President & CEO dsmith@lrs-ak.com 3700 Centerpoint Drive, Suite 1300 Anchorage, AK 99503 907-349-2931 littleredservices.com

Paid for by Little Red Services, Inc., 3700 Centerpoint Drive, Suite 1300, Anchorage, AK 99503. Douglas L. Smith, President and CEO is the principal officer of Little Red Services, Inc. Douglas L. Smith, President and CEO of Little Red Services, Inc. approved this advertisement.

In the current proposal, the state has TransCanada as a partner in the pipeline and the North Slope gas treatment plant, which brings TransCanada’s expertise to bear on the state’s behalf on those parts of the project. The state has options, under the proposed agreement, to buy 40 percent of the pipeline and gas treatment plant from TransCanada at the time the project enters the Front-End Engineering and Design (FEED) phase of engineering, a major step in the project that could occur in 2016. The state also has an option to purchase 100 percent of TransCanada’s share at a later time. Gas Pipeline Efforts There have been many efforts over several decades, in fact since North Slope oil production began in 1977, to build a gas pipeline. Several efforts developed to advanced stages, including a consortium of gas producers and gas utilities (the customers) in the Lower 48 to build a pipeline via the MacKenzie River valley in Canada, which Canada blocked because of unresolved Native land claims, and a project in the 1980s led by Lower 48 gas companies that included Foothills Pipe Lines (now TransCanada). That project ended when Lower 48 gas prices collapsed. There were other proposals studied along the way including one for a pipeline, a liquefied natural gas (LNG) export project in the 1990s, by a consortium of North Slope producers BP and ARCO; Marubeni, a Japanese company; and Foot Hills Pipe Lines. The Asia market did not appear ready at that time to purchase enough Alaska LNG to make the project workable. The most recent previous attempt, in 2006, was a proposed state-industry partnership with the three North Slope producers, BP, ConocoPhillips, and ExxonMobile, by former Governor Frank Murkowski, which did not advance. The plan before the Legislature in 2014 is similar in some respects to Murkowski’s plan but significantly different in others. One big difference is that the Murkowski plan involved an all-land pipeline to Canada to market Alaska gas in the Lower 48. This effort ended when cheap shale gas entered Lower 48 markets in large quantities, making the all-land pipeline uneconomic, at least for now. The plan was then changed to a pipeline from the North Slope south across Alaska to a large LNG plant, now designated to be at Nikiski, near the city of Kenai, with LNG intended to be shipped mainly to Asia. However, the centerpiece of the 84

Alaska Business Monthly | April 2014

Murkowski plan was similar to what is now proposed, the state taking its royalty and taxes “in kind,” or in the form of gas, and then shipping the state gas through a part of the gas project owned by the state (or partly owned, in the latest plan). The concept was for the state to ship its own gas, the tax and royalty share, and earn profits not only from sales of the gas as LNG, but also from the shipment of the gas through its share of the pipeline.

tax-share gas, the producer companies would then be responsible for financing only a portion of the project equal to their own share of gas. Having the state (again, through TransCanada) assume part of the financing obligation reduces the amount of capital the producer partners must invest and also shares the risks. The plan brings the overall project into a better alignment in the sharing of benefits and risks, the companies have said.

The TAPS Model Each of the producer company partners would pursue similar arrangements, owning a part of the project with a share proportional to ownership of gas. BP would ship its share of gas though its share of the project as would ExxonMobil and ConocoPhillips. In that manner each partner maximizes profits, as would the state. One way to think about this is a gas pipeline with several pipelines within it, each one owned by one the major gas producing companies (which would ship gas) as well as the state in its partnership with TransCanada. The separate entities are owned and managed by the respective companies. As a side note, the trans-Alaska oil pipeline ownership is arranged in the same manner, with pipeline subsidiaries of the oil producing companies as the actual owners of TAPS (Trans Alaska Pipeline System). These subsidiaries pay the taxes and deal with the regulatory agencies on tariffs. Alyeska Pipeline Service Company, which is also owned by the producing companies, is the operating company for the pipeline, but it is the various pipeline subsidiaries that actually own TAPS. Bringing the state in as a partner on the gas project has some key advantages for the producing company partners. By having the state (and TransCanada, through the partnership between the two) finance and own enough of the project to ship the state’s royalty and

TransCanada as Partner A significant difference in the current proposal from the 2006 Murkowski plan is the presence of TransCanada in the deal. In the 2006 plan the state would have been a full equity partner, financing its full share and assuming the management obligations for its pipeline-within-a-pipe. Critics at the time argued the state would have been unequal to the industry in terms of experience and expertise, which would put the state at a disadvantage in questions of management of the project. In the current proposal, the state has TransCanada as a partner in the pipeline and the North Slope gas treatment plant, which brings TransCanada’s expertise to bear on the state’s behalf on those parts of the project. The state has options, under the proposed agreement, to buy 40 percent of the pipeline and gas treatment plant from TransCanada at the time the project enters the Front-End Engineering and Design (FEED) phase of engineering, a major step in the project that could occur in 2016. The state also has an option to purchase 100 percent of TransCanada’s share at a later time. However, the current plan also has the state being a direct equity owner, and investor, in the large LNG plant that is now planned for Nikiski, near Kenai. The 20 to 25 percent share of the LNG plant would be owned through the state-owned Alaska Gasline Development Corporation., AGDC. www.akbizmag.com

For TransCanada, the deal has advantages because the state becomes the pipeline company’s customer for shipping gas. Since TransCanada, a pipeline company, does not own its own gas, it needs a gas shipper as a customer. With the state’s shipping contract in place, TransCanada will be able to arrange the financing it needs for its investment. TransCanada plans to make a direct equity investment of 25 percent of the costs of its share of the project and to raise the remaining 75 percent in debt markets. The shipping contract is crucial for the state as well as TransCanada because it is binding—in industry jargon “take or pay”—meaning that the payments to TransCanada for pipeline capacity must be guaranteed by the state, in all events. This obligation could amount to about one billion dollars a year, consultants to the state have said. Of course, the state receives the revenues from sales of the gas, which is sold as LNG. Preliminary estimates are that the state could earn $2 to $3 billion a year in gross sales revenues, from which the billion dollars to TransCanada would be paid. TransCanada makes its profit from charging a

tariff, or fee, for transporting the gas. If the initial term of the shipping contract is twenty-five years, which is not uncommon, the state would obligate itself to make those payments, possibly a billion dollars a year, for twenty-five years. This is not a minor decision. Each of the other industry partners works out similar arrangements for their parts of the project. Each producer signs a binding shipping contract with its pipeline subsidiary and it is the subsidiary that arranges the financing, based on the contract. This separation of the producing company from a pipeline subsidiary is needed because the pipeline parts of the project are regulated by government agencies. The Federal Energy Regulatory Commission (FERC) is involved, in approval of tariffs and other matters, when interstate shipments of oil and gas are made. The state’s Regulatory Commission of Alaska (RCA) is involved if intrastate gas shipments occur. This is similar, again, to TAPS. FERC regulates the interstate shipments of oil and RCA regulates in-state shipments, for example, for oil purchased by Alaska refineries.

An important part of the state’s involvement with TransCanada is that the pipeline company has agreed to a certain debt/ equity ratio in its financing plan, committing to no more than 25 percent equity with the remaining 75 percent financed by debt. In these arrangements the regulatory agencies allow the pipeline owners, in this case the producers’ pipeline subsidiaries, and TransCanada, the state’s partner, a guaranteed return on investment on the equity they have invested (but not the debt). The state’s RCA would approve tariffs when gas is taken off the pipeline for use within Alaska. When the pipeline companies receive approval for the tariff, a certain level profit—12 percent is typical, but it could vary—is guaranteed by the regulatory agency. This is similar to the regulation of public utilities, like tele-

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April 2014 | Alaska Business Monthly

TransCanada agreed to the 75/25 debt/equity ratio as a legacy of its Alaska Gasline Inducement Act contract with the state, in which it also agreed to the ratio. That part of the AGIA commitment has been carried over to the new contract that is proposed. phone companies and municipal water and sewer systems, where the return on investment is guaranteed. TransCanada, as a pipeline company, is familiar with these arrangements. It is in the pipeline business and owns extensive pipeline systems in Canada and the United States that ship oil and gas for customers. Most or all of these are regulated by government agencies. An important part of the state’s involvement with TransCanada is that the pipeline company has agreed to a certain debt/equity ratio in its financing plan, committing to no more than 25 percent equity with the remaining 75 percent financed by debt. This is important because the regulatory agencies will approve the rate of return, or profit, part of the tariff on only the equity, so the lower the equity the lower the

Alaska Business Monthly | April 2014

profit, and the lower the overall tariff. As the shipper of gas it is to the state’s advantage to have the lowest possible tariff so as to maximize revenues from sales of gas.

The Producers The North Slope producers are in a different situation. The pipeline subsidiaries of those companies also file for tariffs, and these firms may choose to use a higher equity, with less debt. In these cases the tariffs would be higher, with the pipeline company earning more profit, but at the expense of the “upstream” company, which pays more for transportation of its gas share. However, in these cases the producing and pipeline companies are owned by the same corporation, so for the parent company it is a matter of sorting out which subsidiary the money is paid to that is most advantageous.

But where the producing entity is separate from the pipeline owner, as will be the case with the state and TransCanada relationship, the matter of the debt/equity ratio and the tariff is very important. TransCanada agreed to the 75/25 debt/equity ratio as a legacy of its Alaska Gasline Inducement Act contract with the state, in which it also agreed to the ratio. That part of the AGIA commitment has been carried over to the new contract that is proposed. Interestingly, the FERC will likely exert jurisdiction over the pipeline/ LNG project even though it will physically be located entirely within Alaska, with the LNG sold to foreign buyers, most likely. This is not yet entirely clear (there is some argument that the state RCA may be able to have jurisdiction over the entire project), but FERC jurisdiction is most likely to prevail in the end, people familiar with the project say.  Mike Bradner is publisher of the Alaska Economic Report and Alaska Legislative Digest.

www.akbizmag.com

OIL & GAS

in an Aging Oilfield By Paula Cottrell

hen LRS, Inc. (formerly Little Red Services) brought their first hot oil truck to the North Slope of Alaska in 1983, no one really knew what it was or why anyone would even need one. “We were a little early showing up,” says LRS, Inc.’s Vice President of Operations, Joe Curgus. This kind of forward thinking, however, is what has helped LRS, Inc. grow into a company that is providing oil well related services—over thirty years later—to every major oil producer on the North Slope.

When “Low Flow” Compromises Integrity The need for well related maintenance services was not a concern when oil started running down the trans-Alaska oil pipeline in 1977. Producers had little thought for “low flow” or “hard to reach oil” as production continued to steadily increase for the first ten years of operation until hitting an all-time high of 2 million barrels per day in 1988. Since then, crude production has steadily declined with annual production numbers coming in at under 200 million barrels for the first time in 2012, 88

Alaska Business Monthly | April 2014

according to the US Energy Information Administration. With the days of “easy oil” gone, producers are challenged with not only keeping the oil moving, but doing so safely in a pipeline that was built to transport higher volumes of product. Lower production isn’t just a matter of decreased profits for oil companies. According to Alyeska Pipeline Service Company’s “Low Flow Impact Study” which was released in June 2011, low flow rates on crude oil pipelines can cause operational issues, particularly in the frigid Arctic, when oil production progressively declines below 600,000 barrels per day. Potential operation issues that can be caused by low flow rates, according to Alyeska’s report, directly contribute to system and pipe corrosion such as water dropout from the crude oil, sludge drop out, ice formation if oil temperatures drop below freezing, wax precipitation and deposition, displacement of buried pipelines due to soil freezing and thawing as pipeline operating temperatures decline, reduction in pipeline leak detection efficiency, pipeline shutdown and restart, and the inability of pipeline pigs

to operative effectively in both cleaning and checking pipeline integrity. “One of the main reasons pipelines fail is because of corrosion,” says Ben Schoffmann, CEO of Kakivik Asset Management, LLC, an inspection and integrity management company that has been active on the North Slope since 2001. “Corrosion can occur on the outside as well as inside of piping systems, compromising integrity and increasing the risk of failure. And when production fluids like oil and gas get outside of the pipe, nothing good happens,” he adds.

Mitigating Corrosion During Production “Even though oil production is on the decline, there is still a lot of oil to be found in Prudhoe Bay,” says Curgus. “It’s just not as easy to find. Hot oil service operations have proven to be a critical component as oil producers on the North Slope try to extract oil from wells with lowered flow rates and some of the hard to reach oil.” This is where LRS, Inc. and their hot oil technology come into play. “As the field matures, you have to displace the www.akbizmag.com

An LRS, Inc. unit leaving a job in the Kuparuk ﬁ eld for CPA. Photo by Judy Patrick

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April 2014 | Alaska Business Monthly

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Left: A Kakivik NDT Tech conducting a corrosion investigation. Above: Looking for corrosion under insulation with a proprietary Kakivik automated crawler.

water,” says Curgus. “Paraffin, scale, salt, iron-sulfide, and other compounds created by oil and gas extraction can corrode, plug up, and hamper the performance of wells, pumps, tanks, and flow-lines. By injecting hot water, oil, or chemicals into wells and lines to displace the water utilizing one of our hot oil systems, we can keep equipment online and producing by eliminating freezing and corrosion which can also adversely affect the quality of the product,” he adds. In addition to injecting product into wells, LRS, Inc. also performs critical mechanical integrity testing to ensure lines and tubulars can continue to withstand the pressure of oil production. “Preventative maintenance is key for producers to continue operating safely on the North Slope,” says Curgus. “Prudhoe Bay is one of the cleanest oil fields you will find because it is clearly understood that oil and the environment are not separate. There are good regulations in place that allow for balance between production and the environment and this is key to making sure we can continue to produce oil well into the future.” Kakivik also assists its clients in continuous monitoring and injection of chemicals in surface production systems to mitigate corrosion and maintain flow, according to Schoffmann. “Preventing corrosion is obviously a prudent and wise investment,” he says. “Our technical personnel are skilled in not 90

Alaska Business Monthly | April 2014

only looking for corrosion, but working to prevent and minimize its impacts. We help to manage chemical programs by monitoring corrosion rates through the installation and monitoring of corrosion coupons and probes, testing fluids to determine their corrosivity, and optimizing chemical selection and use.”

Advances in Technology Without a doubt, technological advances have played a large part in keeping the oil flowing on the North Slope for the past thirty-five years. “Five years ago we didn’t have the technology, such as complex directional drilling, to get to the oil that producers are able to get to now,” says Curgus. “Even the extraction techniques being used in North Dakota today wouldn’t have been possible just ten years ago.” LRS, Inc. has relied on these advances to not only improve how hot oil work is performed on the North Slope, but they have also been able to bring this technology to the manufacturing process of their hot oil machines. “Previously we had purchased our hot oil units in Canada, but we began working with a local company called WEONA Fabricators so that we could build and construct our hot oil units here in Alaska. This not only brings jobs to Alaskans, it helps us have more direct contact during the collaboration process to ensure we are bringing innovation and efficiency to our clients,” says Curgus.

Technology and Inspection For the pipeline inspectors at Kakivik Asset Management, technology has changed the way they approach the inspection process. “We use x-ray, ultrasonic, electromagnetic, infra-red, magnetic, and other technologies to perform inspections,” says Schoffmann. “But what sets Kakivik apart is that we are utilizing this existing and new technology in some innovative ways. This is particularly true in the way we look for corrosion in insulated pipelines and piping systems.” “Of course, prior to the advent of the techniques we now use, operators had to take off all or some of the insulation to visually inspect the pipe or perform standard types of inspection without interference from the insulation,” Schoffmann explains. “The cost and time involved were significant and even then it was not even possible to get a complete inspection done. We can now, with a high degree of confidence, far more cost-effectively and safely inspect the pipe without removing the insulation and without taking the pipeline out of service.” Advancements in automated inspection techniques have gone a long way in the fight against corrosion. Smart pigs—devices used to internally clean and inspect pipelines—are a common automated method for checking pipeline integrity. Many pipelines and piping systems, however, are not designed to accommodate smart pigs, so Kakivik www.akbizmag.com

developed their own external crawlers. “These devices allow us to mount the required inspection equipment so it can run along the outside of the pipe to look at what is going on under the insulation or inside the pipe depending on the need,” says Schoffmann. “Our crawlers are operated remotely and we are able to transmit images of the inspected areas to our control unit wirelessly to speed interpretation of the condition of pipe and insulation systems. This technology is especially useful when inspecting long lengths of insulated pipeline or to inspect facility piping in areas that are hard to access.” Because of the improvements in inspection equipment that make it more portable and easier to handle, Kakivik now conducts many of its piping inspections using rope access technology. This relies on equipment and training that are employed by mountain climbing experts around the world. “Rope access helps to gain access quickly, safety, and cost-efficiently when compared to the more historically used approach of building scaffolding or work platforms,” explains Schoffmann. “Our unique approach to looking for corrosion under insulation combined with the ef-

ficiency of using rope access has taken us outside of Alaska and even overseas to assist customers with their integrity management programs.”

The Cost of Integrity Certainly cost concerns are still a major factor when determining the feasibility of oil production in Alaska. “The cost of maintenance at some point won’t be sustainable,” says Curgus. “The oil field is aging and lower production rates require additional maintenance. Producers have to weigh these costs against their returns on the oil and gas they are producing on the North Slope.” “We know we have to keep costs down without compromising safety and quality,” adds Schoffmann. “For us, it’s a matter of finding ways to do the same things more effectively and efficiently in order to insure that pipelines, facilities, and other infrastructure assets can be safely operating for years to come.” He says one piece of legislation that has helped in the battle to keep Prudhoe Bay vibrant is Senate Bill 21 (SB21). “What happens in Prudhoe affects everyone in the state. The changes that

came with SB21 incentivizes oil producers to keep investing in Alaska,” explains Curgus. “Under ACES, there wasn’t much incentive to keep pumping money into the aging oilfield, but with a balanced tax structure and credits for manufacturing in Alaska, there are more opportunities for everyone.” For LRS, Inc., this meant being able to afford bringing the manufacturing of their hot oil units to Alaska at a cost savings that can be passed on to their clients. “We have doubled capital expenditures in the last year because of SB21, and that directly contributes to not just more jobs for Alaskans, but affordable pricing for producers,” says Curgus. “It’s important to me that the next generation of workers have the same opportunities and jobs that we have enjoyed over the last thirty years that a robust economy can bring. And without a doubt, keeping up with the maintenance requirements of Alaska’s most lucrative asset has the potential to keep Alaskans busy for years to come.”  Paula Cottrell is an Alaskan author.

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r EQUIPMENT RENTAL/PROJECT SUPPORT COMPANY r SUPPORTING THE NORTH SLOPE & COOK INLET r HEATERS, GENERATORS, VEHICLES, MANLIFTS, LIGHT PLANTS r CAMPS & CAMP SERVICES r FULL PROJECT LOGISTICS SERVICES & STAFFING www.akbizmag.com

Magtec Alaska, LLC (907) 394-6350 Roger Wilson, Prudhoe Bay rwilson@magtecalaska.com Skeeter Creighton, Kenai (907) 394-6305 skeeter@magtecalaska.com

907.278.1877 April 2014 | Alaska Business Monthly

OIL & GAS

Platform Renaissance

The Grayling platform in Cook Inlet.

Built mostly in the 1960s, Cook Inlet oil and gas leviathans still have some life left By Wesley Loy 92

Alaska Business Monthly | April 2014

ust a few years ago, many of the oil and gas platforms in Cook Inlet appeared done for. Built mostly in the 1960s, the platforms had contributed strongly to a grand oil boom during the early years of Alaska statehood. But diminishing oil and gas reserves suggested the end of their useful lives. Some platforms were shuttered, and plans were laid to decommission others. Separately, in 2009, a company bankruptcy left an-

other platform in jeopardy of becoming a financial albatross for the state. It was a pretty bleak picture all in all. But recently, the outlook has brightened. Aggressive new companies have taken over most of the sixteen platforms. The companies are infusing new capital and enthusiasm, betting the structures aren’t ready for retirement just yet. “It’s no secret, the investments we’ve made,” says Lori Nelson, spokeswoman www.akbizmag.com

Photo courtesy of Hilcorp

for Hilcorp, the privately held company that operates twelve of the platforms. The platforms would seem an ideal challenge for the Houston-based company, which has a reputation for reviving mature oil and gas assets.

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Birth of a Boom Cook Inlet today is Alaskaâ&#x20AC;&#x2122;s secondary oil patch, producing only a fraction of the volume seen from the North Slope. www.akbizmag.com

April 2014 | Alaska Business Monthly

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West McArthur Production Facility

Tyonek A

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Kustatan Production Facility

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Spark Spurr Monopod Trading Bay Production Facility

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Osprey Tesoro Refinery

Nikiski Facilities

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Kenai ! Cook Inlet Areawide Petroleum Infrastructure

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Production Pad Offshore Structures

PIPELINES Inactive Line

Soldotna Non-Common Carrier Oil Pipeline

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Non-Common Carrier Gas Pipeline Common Carrier Pipeline

The State of Alaska makes no expressed or implied warranties (including warranties of mechantability and fitness) with respect to the character, function, or capabilities of the product or its appropriateness for any users purposes. In no event will the State of Alaska be liable for any incidental, indirect, special, consequential, or other damages suffered by the user or any other person or entity whether from use of the product, any failure thereof or otherwise, and in no event will the State of Alaska's liability to you or anyone else exceed the fee paid for the product. Discrepancies in boundary alignments are the result of merging multiple data sets from a number of different sources.

Map Created: August 20th, 2013

Map Location 0

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Alaska Business Monthly | April 2014

Source: State of Alaska, Department of Natural Resources, Division of Oil and Gas

Abandoned This map was created, edited, and published by the State of Alaska, Department of Natural Resources, Division of Oil and Gas, and is for informational purposes only.

151°0'0"W

www.akbizmag.com

Before the Slope’s enormous Prudhoe Bay field was developed, Cook Inlet was the star. Exploratory drilling exploded in the early 1960s, and fourteen platforms were installed between 1964 and 1968 in the icy, tidally turbulent inlet. Some of the platforms took names such as Dolly Varden and King Salmon, reflecting the living resources of Cook Inlet. Another was called Spurr, after one of the volcanoes along the inlet’s western side. Cook Inlet oil production peaked in 1970 at around 225,000 barrels per day, and the platforms contributed substantially to the basin’s output. Two more platforms were installed subsequent to that 1960s building spree—the Steelhead platform in 1986 and the Osprey platform in 2000. Looking at a map of the inlet, eleven of the platforms are arrayed along the western side. Pipelines carry production from the platforms to shore-based processing plants. The other five platforms feed their production to facilities on the Kenai Peninsula, on the inlet’s east side. The peninsula is home to the Tesoro refin-

Cook Inlet oil and gas platforms Platform name A Anna Baker Bruce C Dillon Dolly Varden Granite Point Grayling King Salmon Monopod Osprey Spark Spurr Steelhead Tyonek

Operator XTO Energy Hilcorp Hilcorp Hilcorp XTO Energy Hilcorp Hilcorp Hilcorp Hilcorp Hilcorp Hilcorp Cook Inlet Energy Hilcorp Hilcorp Hilcorp ConocoPhillips

Year installed 1964 1966 1965 1966 1967 1966 1967 1966 1967 1967 1966 2000 1968 1968 1986 1968

Status Active Active Active Active Active Shut in Active Active Active Active Active Active Shut in Shut in Active Active

Status as of February 2014

ery, which converts Cook Inlet crude oil into finished products such as gasoline.

Lucrative Production Stream Aside from Hilcorp, three other companies operate Cook Inlet platforms. XTO

Energy, a subsidiary of ExxonMobil, runs a pair of platforms known as A and C. ConocoPhillips operates Tyonek, the inlet’s northernmost platform, and Cook Inlet Energy operates Osprey, the southernmost platform.

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1000 Lake Colleen Rd. Prudhoe Bay, Alaska 99734 sangel@seekins.com April 2014 | Alaska Business Monthly

State of Alaska Department of Natural Resources Division of Oil & Gas

Cook Inlet Unit Land and Lease Working Interest Ownership

Lone Creek Unit (CIRI) Aurora Gas, LLC

100%

Moquawkie Unit (CIRI) Aurora Gas, LLC

100%

North Trading Bay Unit Hilcorp Alaska, LLC

100%

Ivan River Unit Hilcorp Alaska, LLC Uncommitted

99.82% 0.20%

Pretty Creek Gas Storage Lease Hilcorp Alaska, LLC 100%

Stump Lake Unit Hilcorp Alaska, LLC

100%

Pretty Creek Unit Hilcorp Alaska, LLC

Ivan River Gas Storage Lease Hilcorp Alaska, LLC

100%

50.00% 33.33% 16.67%

Northwest Cook Inlet Unit Buccaneer Alaska, LLC Rutter & Wilbanks Corp.

98.17% 1.83% 70.00% 30.00%

Kitchen Lights Unit Cornucopia Oil & Gas Co., LLC A.L. Berry Danny S. Davis Taylor Minerals, LLC Furie Operating Alaska, LLC

100%

Beluga River Unit ConocoPhillips Alaska, Inc. Municipality of Anchorage Hilcorp Alaska, LLC

North Cook Inlet Unit ConocoPhillips Co. ConocoPhillips Alaska, Inc.

100%

Granite Point Field Hilcorp Alaska, LLC 100%

100%

Otter Unit Cook Inlet Energy, LLC 100%

Three Mile Creek Field Aurora Gas, LLC 50% Cook Inlet Energy , LLC 50%

Nicolai Creek Unit Aurora Gas, LLC

South Granite Point Unit Hilcorp Alaska, LLC

Lewis River Unit Hilcorp Alaska, LLC

79.00% 7.88% 6.88% 5.25% 1.00%

X X X

Southern Cross Unit Buccaneer Alaska, LLC

100%

Birch Hill Unit Hilcorp Alaska, LLC

100%

Swanson River Unit Hilcorp Alaska, LLC

100%

Swanson/Kenai Gas Storage 1 & 3 Hilcorp Alaska, LLC 100%

X X

Tiger Eye Unit NordAq Energy, Inc. West Foreland Field Cook Inlet Energy, LLC ConocoPhillips Co.

100% 80% 20%

Kustatan Field Cook Inlet Energy, LLC

100%

Trading Bay Unit Hilcorp Alaska, LLC

100%

North Middle Ground Shoal Field Hilcorp Alaska, LLC 100% Middle Ground Shoal Field XTO Energy Inc. 77.08% Hilcorp Alaska, LLC 22.92% South Middle Ground Shoal Unit Hilcorp Alaska, LLC 100%

Redoubt Unit Cook Inlet Energy, LLC

100%

Cannery Loop Unit Hilcorp Alaska, LLC Uncommited

99.42% 0.58%

Cook Inlet

Wolf Lake Gas Hilcorp Alaska, LLC

100%

Beaver Creek Unit Hilcorp Alaska, LLC

100%

West Fork Field Hilcorp Alaska, LLC

100%

Sterling Unit Hilcorp Alaska, LLC Uncommited

99.84% 0.16%

CINGSA Gas Storage Lease Cook Inlet Natural Gas Storage, LLC 100%

Ninilchik Unit Hilcorp Alaska, LLC Uncommitted Mineral Owners

Pool 6 Gas Storage Lease Hilcorp Alaska, LLC

100%

Kenai Unit Hilcorp Alaska, LLC

100%

Kasilof Unit Hilcorp Alaska, LLC

100%

96.62% 3.38%

State Unit

Deep Creek Unit Hilcorp Alaska, LLC Uncommited

Field

Non-Producing

99.82% 0.18%

Gas Storage Lease

State/Native Unit

Native Unit

Cosmopolitan Field BlueCrest Energy, Inc. Buccaneer Alaska, LLC

Apache Field Apache Alaska Corp.

Alaska Seaward Boundary

Federal/State Unit

100%

75% 25%

Nikolaevsk Unit Hilcorp Alaska, LLC

100%

West Eagle Unit Buccaneer Alaska, LLC

100%

North Fork Unit Dale Resources Alaska, LLC GMT Exploration Co., LLC Armstrong Cook Inlet, LLC Jonah Gas Co., LLC Nerd Gas Co., LLC

35% 30% 20% 7.5% 7.5%

96 96

Platform

(Outer Continental Shelf Boundary)

Federal Unit

Alaska Business Monthly | April 2014

$ Map Location

2.5

10 Miles

Note: Unit boundaries, acreages and land working interest ownership (WIO) percent are subject to change due to formation of new units, contractions, and expansions of unit acreages, termination of unit agreements, and changes in WIO. For simplification, WIO percentages are based on total land ownership in unit or lease and were rounded to two decimal points. Unit and lease ownership may be different than ownership of production. Map Published January 2014

This map contains data from various sources and DNR holds no responsibility to the accuracy of the data displayed on this map.

Source: DNRâ&#x20AC;&#x201D;This map contains data from various sources and DNR holds no responsibility to the accuracy of the data displayed on this map.

West McArthur River Unit Cook Inlet Energy, LLC 100%

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The deals left Hilcorp with a huge challenge—a dozen platforms, most approaching fifty years of age. The question in many minds was, Can Hilcorp make a go of these old assets? Today, three platforms are shut in, or inactive, their wells no longer producing any oil or natural gas. These are Dillon, Spark, and Spurr, which all belong to Hilcorp. Figures from the Alaska Oil and Gas Conservation Commission show the producing platforms combined for 3,774,910 barrels of oil in 2013, or an average of 10,342 barrels per day. At a price of $100 per barrel, the year’s production from the platforms would tally more than $377 million, quite a worthwhile sum. The top oil producer for 2013 was XTO’s A platform, with 502,530 barrels, followed closely by Hilcorp’s one-legged Monopod platform with 491,501 barrels. A couple of platforms, Steelhead and Tyonek, produce large volumes of natural gas.

Hilcorp’s Strategy The fate of most Cook Inlet platforms now rests with Hilcorp, a relative newcomer to Alaska. In mid-2011, the company agreed to buy Chevron’s collection of Cook Inlet oil and gas assets. The company later acquired Marathon’s inlet properties. The deals left Hilcorp with a huge challenge—a dozen platforms, most approaching fifty years of age. The question in many minds was, Can Hilcorp make a go of these old assets? Hilcorp is a company with considerable muscle. Founded in 1989, Hilcorp bills itself as one of the nation’s largest privately held independent exploration and production companies. Its billionaire chief executive, Jeffery Hildebrand, is a former Exxon man. The company moved swiftly on plans to reinvigorate the Cook Inlet platforms. In 2012, Hilcorp carried out a “derricks down” program, removing antiquated derricks to make way for newly built rigs. The new rigs are smaller, more efficient, and make transportation between platforms easier. A total of eight derricks were removed

from the Bruce, Dolly Varden, Granite Point, Grayling, and King Salmon platforms at a total cost of $4.5 million, the company says. The Baker platform, installed in 1965, provides an interesting case study in Hilcorp’s strategy. The platform was inactive and unmanned in 2010, with operator Chevron planning to plug and abandon the platform’s twentyplus wells. Chevron estimated outright removal of the Baker and Dillon platforms in 2019. As of February of this year, however, Hilcorp listed Baker as active again, and state data showed it produced a modest volume of dry gas in 2013. Hilcorp had signaled in 2012 that it planned to conduct natural gas exploration through reactivation of the Baker platform. In April 2013, Hilcorp filed a new development plan for the North Middle Ground Shoal field, where Baker stands. The plan discussed equipment upgrades the company had made on the platform and said the first phase of the reactivation was to bring three gas wells back online.

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Cook GasActivity Activity CookInlet InletOil Oil and and Gas

¹ ¹

State of Alaska, Department of Natural Resources, Division of Oil and Gas, December 2013 State of Alaska, Department of Natural Resources, Division of Oil and Gas, December 2013 Willow

Cook Inlet CookEnergy Inlet Energy ConvertedConverted requested exploration license acreage to lease requested exploration license acreage to lease uponwork fulfilling work commitment; drilltouptwo to two upon fulfilling commitment; plan toplan drilltoup gasgas on theCreek Kroto Creek prospect. wells on wells the Kroto prospect.

Willow

Nancy Lake StateState Nancy Lake Recreation AreaArea Recreation

Houston

Wasilla

Susitna

Division of Oil and Gas

Cook Inlet Energy Otter Unit approved retroactive Cook Inlet Energy to September 27, 2013 under a Otter Unit approved retroactive modified Unit Agreement and to September 2013 under a Plan of27, Exploration.

Areawide salesGas tentatively scheduled Division oflease Oil and for May 2014, encompassing approximately Areawide lease sales tentatively scheduled 4 million acres in Cook Inlet and 5.8 million for May 2014, encompassing approximately acres in Alaska Peninsula. 4 million acres in Cook Inlet and 5.8 million acres in Alaska Peninsula.

modified Unit Agreement and Plan of Exploration.

Otter

Houston

Big Lake

Susitna

Wasilla

Big Lake

Knik

LDRT 1

Susitna Flats State Game Refuge Susitna Flats State

LDRT 1

Lewis River

Game Refuge

OTTER 1 & 1A

Pretty LewisStump River Creek OTTER 1 & 1A PRETTY Lake CREEK UNIT 4

Otter

CIRI CC-09C-10 to CC-12C-11

SPURR WEST 26-11

OLSEN CREEK 1 CIRI CC-09C-10 to CC-12C-11

SPURR WEST 26-11

TYEX 02

OLSEN CREEK 1 Lone

Creek

Aurora Gas Plan to drill two wells and workover a third; expects an average production increase of 3 MCF per day per well.

02 KEEXTYEX 2

IVAN RIVER 44-36

Ivan Creek

PRETTY CREEK UNIT 4

TYEX 01 & 01X

River

Beluga River

TYEX 01 & 01X

Tyonek Moquawkie Beluga

Stump Lake

IVANCook RIVERInlet 44-36 NW Ivan

River

Anchorage

ConocoPhillips Farmed out deep oil rights at North Anchorage Cook Inlet Unit to Buccaneer Energy; first well to be drilled by end of 2014.

North NW CookCook Inlet Inlet

ConocoPhillips Aurora Gas River 2 KALDACHABUNA Farmed out deep oil rights at North Kitchen Lights KEEX 2 Trading Plan to drill two wells and workover a third;Bay Nicolai Creek Cook Inlet Unit to Buccaneer Energy; Furie expects an average production increase of 3 KITCHEN LIGHTS 4 State Game Refuge first well to be drilled byand endmoving of 2014. Plan toInlet install gas production platform next year gas Moquawkie South Granite Point Tyonek North Cook MCF per day per well.

Southern Cross

onshore by fourth quarter 2014; suspended drilling of Kitchen Hope Lights Unit No. 4 well for winter and will re-enter next year;

KITCHEN LIGHTS 3

Kitchen Lights North Trading Bay Spartan 151 jack-up moved to Port Graham for winter. Trading Bay Nicolai Creek KITCHEN LIGHTS 2 & 2A Furie Bay KITCHEN LIGHTS 4Hill State Game RefugeTrading Birch NordAq Energy Plan to install gas production platform next year and moving gas South Granite Point KALDACHABUNA KITCHEN 2 LIGHTS 1

Redoubt Bay West McArthur KITCHEN LIGHTS 3 Southern River Cross Critical Habitat Area KITCHEN LIGHTS 1 SWORD 1 North Bay Tiger Trading Eye SHADURA 1 KITCHEN LIGHTS 2 & 2A TIGER EYE Trading Bay KGSF 1 & 7A CENTRAL 1 SOLDOTNA CREEK UNIT Birch Hill 42-05Y & 42-05X West McArthur Inlet Energy Redoubt Bay Cook South Swanson Completed Sword No. 1 exploratory River Middle Ground River Fm oil zone. Plan to test Tyonek G oil Tiger Eye zone and shallower Tyonek gas sands. TIGER EYE CENTRAL 1 Plan to drill four sidetracks from wells withInlet collapsed casing at Redoubt Unit. Cook Energy

Shoal

Redoubt

acquisition across their acreage throughout Cook Inlet.

Agrium Considering restart of Nikiski fertilizer plant; applied forBuccaneer new air quality permit.

Kasilof Sterling CANNERY LOOP S1-S5 Soldotna KENAI UNIT 21-06RD Kenai KENAI UNIT 22-6X KENAI UNIT 34-31 Clam KENAI BELUGA UNIT 23X-06 Gulch KENAI DEEP UNIT 4 KENAI UNIT 43-06 RD KENAI UNIT 31-07X KENAI BELUGA UNIT 33-06 & 33-07

Kasilof

Kenai

Ninilchik

Cook Inlet 0

Department of the Interior - BOEM Cook Inlet OCS sale 244 scheduled for Anchor 2016; to offer 1.17 million acres north of Point approximately 59.45 degrees North latitude.

Cook Inlet Energy Acquiring North Fork field from Armstrong; transaction expected to close in first quarter 2014. 0

98 98

Chugach National Forest

National Wildlife Refuge

Hilcorp Expanding production at many legacy fields; offering utilities gas to meet contracts through first quarter 2018. RCA will sponsor a settlement conference to attempt to consolidate four Cook Inlet pipelines into one system. Kenai National

Tustumena

Ninilchik

Buccaneer Lake well by January Commitment to complete 31, 2014 to maintain unit in good standing.

Wells Drilled 2012 Wells Drilled 2011

Kenai National Moose Range

Geothermal Leases

West Eagle

Units

Alaska Seaward Boundary

Wells Drilled 2013 Wells Drilled 2012 Wells Drilled 2011 Existing Wells Approved for Gas Storage

Nikolaevsk

North Fork

Wells Drilled 2013

Existing Wells Approved for Gas Storage

Buccaneer Commitment to complete well by January Homer Kachemak 31, 2014 to maintain unit in good standing.

Nikolaevsk

Cooper Landing

Range Kenai NationalMoose Wildlife Refuge

COSMOPOLITAN 1 Buccaneer Nikolaevsk Drilled Cosmopolitan State No.Interior 1 Department of the - BOEM Nikolaevsk from Endeavor Cook jack-up; Inlet OCStested sale 244 scheduled for Anchor Ninilchik to offer 1.17 and million acres north of two Tyonek2016; Fm gas zones Point North approximately 59.45 degrees North latitude. HAPPYFork encountered Lower Tyonek oil VALLEY sands shallower than penetrated B-14 in previous wells on prospect.

Cook Inlet Energy Deep Acquiring North Fork field from Creekexpected Armstrong; transaction to close in first quarter 2014. COSMOPOLITAN 1 10 Miles

Expanding production at many legacy fields; offering utilities gas to meet contracts through first quarter 2018. RCA will sponsor a settlement conference to attempt to consolidate four Cook Inlet pipelines into one system.

Kasilof

HAPPY Clam VALLEY Gulch B-14

Creek

Chugach National Forest

Buccaneer Cooper Recently renamed wells to reflect their Landing pad number; drilled Kenai Loop No. 1-4, determined gas producing Tyonek 9700’ sand to be in pressure communication with No. 1-1 and 1-3. Hilcorp

Tustumena Lake

Ninilchik

acquisition across their acreage throughout Cook Inlet. Deep

KGSF 1 & 7A

KENAI LOOP 1-1, 1-2, 1-3, 1-4

KENAI LOOP 1-1, 1-2, 1-3, 1-4 Kenai

Kasilof

Drilled Cosmopolitan State No. 1 from Endeavor jack-up; tested two Tyonek Fm gas zones and encountered Lower Tyonek oil Apache sands shallower than penetrated Plan continued 3-D in previous wells on seismic prospect.

Cook Inlet

Kenai

KENAI UNIT 34-31 KENAI BELUGA UNIT 23X-06 KENAI DEEP UNIT 4 KENAI UNIT 43-06 RD Salamatof KENAI UNIT 31-07X KENAI BELUGA UNIT 33-06 & 33-07

Considering restart of Nikiski fertilizer plant; applied for new air quality permit.

ConocoPhillips Applied for LNG export license from DOE; with shipment of up to 40 Apache BCF over two Plan continued 3-D seismic years from restarted Nikiski facility.

SOLDOTNA CREEK UNIT

South Cannery 42-05Y & 42-05X Swanson Sterling MiddleLoop GroundCANNERY LOOP S1-S5 Soldotna Shoal KENAI UNIT 21-06RD Nikiski Beaver Creek KENAI UNIT 22-6X

Completed Sword No. 1 exploratory well, testing 882 BOEPD from Hemlock ConocoPhillips Fm oil zone. PlanApplied to testforTyonek G oillicense from DOE; LNG export shipment up to 40 BCF over two zone and shallowerwith Tyonek gasofsands. Plan to drill four sidetracks from wells Agrium with collapsed casing at Redoubt Unit.

Beaver Creek

SHADURA 1

Salamatof

Redoubt

years from restarted Nikiski facility.

Nikiski

NordAq Energy Alaska Department of Natural Resources granted permission Buccaneer build an all-season gravel across state land; U.S. Recently to renamed wells to reflect their padroad number; drilled Kenai Fishdetermined & Wildlifegas Service signed record decision Loop No. 1-4, producing Tyonek 9700’ofsand to be giving access to the proposed Shadura development. in pressure communication with No. 1-1 and 1-3.

Map Location

Geothermal Leases

West Eagle

Units Alaska Seaward Boundary

Homer Kachemak

10 Miles

Alaska Business Monthly | April 2014

Map Location

Source: State of Alaska, Department of Natural Resources, Division of Oil and Gas

Critical Habitat Area well, testing 882 BOEPD from Hemlock SWORD 1

Alaska Department Natural 2014; Resources granted permission onshore by fourthofquarter suspended drilling of Kitchen to build an all-season gravel road across state land; U.S. Hope Lights Unit No. 4 well for winter and will re-enter next year; Fish & Wildlife Service signed record of decision giving Spartan jack-up moved to Port Graham for winter. access151 to the proposed Shadura development.

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Osprey’s Second Chance Osprey was another platform that stood idle, in “lighthouse mode,” not so long ago. Former operator Pacific Energy Resources, a California company, had fallen on hard times and would liquidate through bankruptcy. For a time, it appeared no one wanted Osprey, despite its status as the newest platform in Cook Inlet. The fear was that it might become an expensive ward of the state. Finally, a fledgling Anchorage company called Cook Inlet Energy agreed to buy Osprey in a 2009 bankruptcy sale, along with an assortment of other

Photo courtesy of Cook Inlet Energy

From the beginning, Osprey had been a disappointing performer in terms of oil output. But Cook Inlet Energy and its parent company, Tennessee-based Miller Energy Resources, felt the platform and the underlying Redoubt Shoal ﬁ eld had great potential.

The Osprey platform in Cook Inlet.

westside oil and gas properties. From the beginning, Osprey had been a disappointing performer in terms of oil output. But Cook Inlet Energy and its parent company, Tennessee-based Miller Energy Resources, felt the platform and the underlying Redoubt Shoal field had great potential. Since the acquisition, Cook Inlet En-

ergy has worked aggressively to revive Osprey, focusing on the platform’s existing wells. Many of these wells were shut in due to collapsed casings or other damage. Crews have drilled sidetracks, or new holes branching off the original wellbore, to restore production. Cook Inlet Energy aims to start drilling brand-new wells soon, using the

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Last year, the Alaska Department of Natural Resources took steps toward potential regulations to better protect the state should a company be unable to fulfill its obligations to properly retire a platform. custom-built, $18 million rig it activated atop Osprey in August 2012. For the final three months of 2013, Osprey produced an average of 1,746 barrels of oil per day, trailing only the Monopod platform. That’s a nift y achievement for Osprey, which for a time appeared to be a dead duck.

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Alaska Business Monthly | April 2014

Industry Burden vs. State Protection State officials saw the Osprey experience as a cautionary tale. Had the story ended differently, the state says it “faced the very real specter of expending tens of millions of dollars” to conduct DR&R for Osprey—dismantlement, removal, and restoration. Last year, the Alaska Department of Natural Resources took steps toward potential regulations to better protect the state should a company be unable to fulfill its obligations to properly retire a platform. This could involve requiring larger bonds of small companies or those scoring poorly on a periodic “financial strength test” that could predict a bankruptcy. Such bonding poses a dilemma. On one hand, the department wants companies to produce oil and gas from leased state land. But it also wants adequate protections for the state and the environment. The question is how to balance these dual objectives, or what state Oil and Gas Director Bill Barron called the

“tension between capital today versus liability tomorrow.” In September 2013, the department held a public workshop to gather feedback on the potential regulations. A number of industry players expressed worry the state might demand additional assurances from companies or impose excessive requirements for drillers such as Furie who have talked of installing new offshore platforms. “If you ask for a billion dollars, you’re not going to get any new platforms,” JR Wilcox, the president of Cook Inlet Energy, said during the workshop. Some suggest that removal might not even be the best approach for old platforms. Rather, it might be adequate to simply clean them up and leave them standing in lighthouse mode, which would be far cheaper. Cook Inletkeeper, a Homer-based nonprofit, last year released a study that concluded, “The first wave of oil and gas infrastructure installed in Cook Inlet in the 1960s has far exceeded its design life,” and existing DR&R bonding is seriously inadequate. Based on recent events, however, it appears dismantlement of Cook Inlet platforms is further down the line than previously thought.  Journalist Wesley Loy writes from Anchorage.

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TRANSPORTATION

Logistics and Scheduling Photo courtesy of Carlile Transportation

Carlile Transportation dockside at the Port of Anchorage.

Alaska’s unique position on the globe

By Rindi White

ore than just getting stuff from here to there, logistics is the core of every business, and Alaska’s unique position on the globe makes it a fascinating place to watch the business of logistics in action. “People think of it as being trucks and boxes. But if you’re in a hospital, the internal workings are the logistics of getting the goods from the central area out to all the departments,” says Dr. Phillip Price, chair of the University of Alaska Anchorage’s Logistics department. “It’s central to every business, basically. Logistics is involved in everything.” The military relies on logistics to coordinate movements of troops and equipment for training exercises or battle. In the motor industry, logistics is involved in the delivery of vehicles for sale, as well as the on-time delivery of parts for repairs. Even events require logistical planning, Price says. Take the Iditarod. “What are the logistics of getting the people there, the equipment there, even the television people there?” Price asks.

102

Alaska Business Monthly | April 2014

Before a single dog hits the trail, weeks of planning have gone into delivering bags full of food and supplies at key points along the trail for each musher, as well as route-checking and lining up volunteers to work every checkpoint. It’s all logistics. While many states have multiple entry points for goods to flow through, Alaska’s flow is more limited. “The uniqueness of up here is that so much comes in by barge, boat, and air,” Price says. And most things come by barge or boat.

Port of Plenty There’s a saying about the Port of Anchorage: “If you eat it, drive it, or wear it, it probably came through the Port of Anchorage first.” According to a recent port summary, 90 percent of the consumer goods sold or used in 85 percent of Alaska first came through the Anchorage port. Southeast Alaska receives goods directly from Seattle/Tacoma by barge, but the goods sent to the rest of the state first stopped at Anchorage. According to 2011 totals, an average of 450 vessels call at the port of Anchorage each year. Of those, 208 are tug/ barges and 206 are container ships like those used by Horizon Lines or Totem Ocean Trailer Express. Another 17 bulk

tankers stop in each year, as well as 8 break-bulk ships, or ships carrying uncontainerized cargo, generally cement or drilling pipe. The port sees about fift y thousand cars, trucks, and vans each year, along with 2.3 million tons of liquid bulk—frequently jet fuel for Joint Base Elmendorf-Richardson or for Ted Stevens Anchorage International Airport, low-sulfur diesel fuel, or aviation gasoline. According to 2011 numbers, about 118,000 pounds of break-bulk cargo comes in each year, along with 240,000 twenty-foot cargo containers. Steamships and barges aren’t the only way goods travel to Alaska—plenty gets shipped up over the road through Canada and some gets flown via cargo plane to its destination. Once items are in Alaska, the shipping network fans out like a spider web. Some things go by rail. Some are trucked over the road. And some items are transported to villages by plane while others are sent by river barge.

Statewide Freight Carlile Transportation is one of the largest trucking companies in the state, with nearly six hundred employees in Alaska. In June 2013, Saltchuk Resources purchased Carlile Transportation Systems. Saltchuk is a Seattle-based www.akbizmag.com

network of transportation and distribution companies that spans the nation, with a focus on Alaska, Hawaii, and Puerto Rico. Their network includes air, land, and sea—Northern Air Cargo, the state’s largest all-cargo airline, is also a Saltchuk company. “It’s been a real success story over the past eight months,” says James Armstrong, president of TOTE Logistics, about the recent purchase. “Carlile has really strengthened its value, particularly to our Alaska customer base.” TOTE, or Totem Ocean Trailer Express, is another Saltchuk company, and has been since 1982. Between freight carried on Totem Ocean steamships to Alaska or by Northern Air Cargo and delivered by Carlile’s fleet of trucks, Saltchuk companies have a hand in delivering much of what is bought and sold in Alaska every day. “We’re one of the biggest movers of air freight, one of the largest customers with the barge and steamship services, one of the largest customers for rail and over-the-road,” Armstrong says. Carlile is also a neutral contract provider, however, meaning the company uses many partners outside the Saltchuk family, based on customer requirements. “A lot of the options we present to customers really depend on the cost and transit time of what they’re moving,” he says. “We do it all in Alaska.” While close to 50 percent of Carlile’s business is LTL, or less-than-truckload shipping, the company is also known for its heavy-haul and bulk shipments. “Were certainly thought of as the lead heavy-haul carrier in Alaska,” Armstrong says. “There are certain corridors we are known for, like up the haul road and on the slope.” For four years the company was involved with a History Channel show, Ice Road Truckers, which featured drivers who work along the Dalton Highway “Haul Road” and on ice roads on the North Slope. While Armstrong says Carlile isn’t on the current season of Ice Road Truckers, its employees are still hard at work in some of the nation’s most extreme trucking environments. “There’s not too much that we haven’t handled,” he says. Wind turbines, modules for the oil and gas industry, military equipment, www.akbizmag.com

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Alaska Logistics ships to Western Alaska.

construction industry-related equipment, and materials—it’s all part of Carlile’s portfolio. The company has very specialized equipment, such as a 100-tire trailer required to carry cargo such as a 110-ton module bound for the North Slope. It can take four tractors to push and pull such heavy loads up the haul road.

“They’re very complex moves and it requires an extraordinary amount of experience to do that. You need to know Alaska, you need to know the environment and the equipment. There are high barriers to entry because you need the knowledge to do that work. That’s the kind of reliability that people expect from Carlile,” Armstrong says.

Serving Western Alaska Alaska Logistics is a Seattle-based company that provides scheduled barge service from Washington to Seward, Naknek, Dillingham, Bethel, Nome, and Kotzebue. It is one of two primary companies providing service to those areas, Alaska Logistics Sales and Operations Associate Brittney Long says. The other, Northland Services, was purchased last fall by Alaska Marine Lines, a subsidiary of Lynden, Inc. Long says Alaska Logistics generally has seven sailings each year, hauling freight from Seattle or Seward up to the smaller ports. The company also does port-to-port shipments and also carries freight up rivers to reach smaller nonhub communities. Alaska Logistics employs about fift y people and, according to Long, last year the company shipped nearly nineteen thousand tons of freight. Long’s father, Allyn Long, who was previously a logistics manager at general contracting company Osborne Construction, started the shipping company in 2003. He began shipping to western Alaska with leased equipment,

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Alaska Business Monthly | April 2014

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but the company has since purchased its own fleet of barges, tugs, and landing crafts, each supplied with forklifts, cranes, loaders, or whatever equipment is necessary to oﬄoad at villages along the route. The company also recently purchased a crane in Seward and has begun to truck items to reach customers if necessary. “We’ve been expanding, trying to accommodate demand,” Long says. For many of the villages served by Alaska Logistics, the barges are lifelines. It’s how communities get the goods to build new schools, hospitals, or equipment to build roads. Alaska Logistics supported a Quality Asphalt & Paving, Inc. job to relocate and rebuild the Tununak Airport this year and last, Long says. Barges headed to the project were filled with equipment, building materials, food, and supplies for the construction crew and more, Long says. Remote projects like that one mean contractors must ship in all their materials, plus the graders, loaders, cranes, and other equipment necessary to build, and sometimes materials to set up and supply temporary

man camps for their workers. The loads on Alaska Logistics barges are often an assortment of vehicles, bulk cargo, and containers full of items. One of the most difficult aspects of shipping to remote villages is the time crunch shippers face, Long says. Shipping can only take place when the water is ice-free, so the company’s sailing schedule runs from April to September. That’s it. “Normally that last barge is packed to the max,” Long says. Project contractors who have a remote project the following year try to ship as many things up the preceding fall as possible so they aren’t wasting limited construction time waiting for materials. Communities along the route stock up on things they need through the winter. There’s a lot of demand for barge space when winter is closing in. “We have to figure out how much freight we have and what’s expected,” Long says. “We have project trackers keeping track of what projects are coming in from the [Alaska] Native corporations, government facilities, and other sources.”

Long says all that demand has led the company to lease a larger barge or run two barges tandem if necessary, but that’s pretty rare. Instead, customers are generally encouraged to ship their goods as early as they can to avoid the last-minute rush.

Flying Freight Taking the slow boat is a must for some items, but what about those essential things that companies need as quickly as possible? That’s where FedEx and other air cargo shippers come in. “We move the economy. Everything shipped in this world—not just through Anchorage or Memphis or Asia—someone has to get it there. And even though there has been a huge shift with [more use of] cargo vessels, a lot of high-value items are still shipped through the air,” says Dale Shaw, managing director for FedEx Express. Shaw’s territory includes Alaska and Hawaii. He’s in charge of making sure an item that someone in Savoonga orders using Priority Overnight delivery gets to them in two days, three at the outside. That’s the way FedEx does

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business around the world, and Shaw says Alaska’s remote nature, weather patterns, and limited transportation options are not permissible excuses for not delivering packages on time. “One of the only challenges you run into in a place like Alaska is that the connectivity is limited compared to the Lower 48. There are very few recovery options out there to get the volume [or shipment] down into the mainstream in the Lower 48. Being as remote as we are, it’s important to have contingency plans,” he says.

Volcano going off, restricting air travel? Just reroute to another airport and limit flights to daylight hours. This winter, Shaw says, road access to Valdez was closed due to the massive avalanche blocking the Richardson Highway. FedEx generally makes daily deliveries from Wasilla but when the road closed, the company delivered shipments every three days by plane instead—at no extra charge to shippers or recipients. “It’s part of doing business in this environment,” Shaw says.

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Of course there is an extra charge if shippers want to make sure an item arrives as soon as possible. FedEx, like most package shippers, have a few high-end shipping categories to make sure items are there when they’re needed. First Overnight or Priority Alert are two, Shaw says, and items shipped using one of those methods have customer service agents dedicated to each package, who track it through delivery. “We identify those types of shipments before they get to us, so when the airplane hits the ground, they are the first things off,” he says. Last year FedEx planes carried between 160 and 170 million pounds each month—that’s about eighty thousand to eighty-five thousand tons. So in the course of a year, that’s almost a million tons landing at Ted Stevens Anchorage International Airport. And that’s just one shipper of several operating at the airport. While much of the freight in the tally is domestic—headed from somewhere in the United States to somewhere in Alaska, Shaw says Anchorage is also a key stopover point for shipments from Asia. Just a small percentage of that incoming international freight stays in the state, he says. Got an iPad? Shaw says it’s possible it stopped in Anchorage on its way to the retailer. A lot of high-end tech tools made in China are shipped to the United States via FedEx and United Parcel Service, he says. Most of that freight, Shaw says, was destined for somewhere else. Only about 120,000 tons, or about 12 percent, of the freight moved by FedEx last year stayed here. About half of Alaska-destined freight stays in Anchorage for distribution through the city and via the road system to Glennallen, Valdez, the upper Kenai Peninsula, and Mat-Su. The other half is flown to Homer, Kenai, Juneau, Fairbanks, Ketchikan, and Sitka or delivered by cartage agents (pilots with delivery contracts, like the US Postal Service bypass mail program) to communities near Prudhoe Bay, Bethel, the Aleutian Chain, and elsewhere. While Alaska isn’t a major exporter, Shaw says about 156,000 tons of freight was shipped from Alaska on FedEx flights, slightly more than was shipped to the state. www.akbizmag.com

Aside from being a significant member of the group Alaskans rely on to connect to the rest of the world, FedEx is a major employer. Shaw says just over a thousand people work for FedEx in Alaska, including pilots and employees at sister companies such as FedEx Express, FedEx Trade Networks, FedEx Ground, and FedEx Office.

Logistics in Focus: Providence The global movement of goods is boggling but how does logistics work within a business, and how important is it? Providence Health & Services Alaska spends a significant portion of its budget each year—about $108 million—on supplies. With more than four thousand employees and twenty-one locations around the state, it takes a bit of streamlining to make sure the supply budget stays in check. “We’ve got a group purchasing organization that we leverage highly,” says Janet Say, system director for Providence’s procurement services department. “Many of our items are standardized and contracted through that entity, and those that aren’t we contract for separately.” Anchorage 1301 E. 64th Avenue 907-563-3238

Photo courtesy of FedEx

FedEx 777 Freighter taking off at the airport in Anchorage where FedEx landed almost a million tons of freight last year, though only 12 percent stayed in Alaska.

The main tool that helps keep supply cabinets stocked and the budget in check, she says, is an automated pointof-use system. Say a nurse needs a set of Electrocardiogram electrodes. He or she pulls the electrodes off the shelf and hits a button for each one taken. That generates an order for more electrodes. A daily order is placed with hospital supply company, Medline, at the end of the day using an electronic requisitioning system and more electrodes arrive

the next day. It’s seamless, effective, and much more efficient than the old system, Say says. “We used to have cards—a traveling requisition card that the nurse would have to put stickers off [for each item used] and that’s how they would get refilled,” Say says. “There was a lot of labor and touches with that. And there were lost charges—nurses were walking around with stickers on their arms.”

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On the inventory side, it means less hoarding because supplies are replenished more than once a week. It also cuts down on labor costs, she says. It takes little time for the button to be pressed to generate the order and, from there to the time the item is delivered, everything is automated. Supplies are linked to patient numbers, so if an item is taken from the cabinet it goes directly to the patient’s bill. And the system includes minimum and maximum limits so that keeps the system from under- or over-ordering, Say says. “It’s really slick,” she says. Another innovation that makes the logistics of running a multifaceted facility such as a hospital go smoothly, Say says, is a physician preference list. If a doctor has a surgery scheduled, he or she selects the tools that will be needed in the operating room when the surgery is booked. The order is generated, ensuring the doctor has all the tools at hand in time for the procedure. The hospital has special procedures for lab and pathology items, Say says. Those items are frequently shipped in a container that has to stay frozen.

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“Those come in and are handled very specially. They go right to the department. Some of them have to be kept at negative seventy degrees, so we have special freezers for that,” she says. Blood is handled by courier service, she says, and a courier also goes to nearby communities such as Mat-Su to pick up or deliver blood and samples. Even with seemingly foolproof innovations in place, Say says glitches still happen. “Sometimes we get a special case in and a physician says he needs a special widget from somewhere—we try to move mountains to get it,” she says. “We are the tertiary medical center here in Anchorage, so there are sometimes items that are challenges for us to get.” Alaska Airlines actually assists in the delivery of medical equipment frequently, Say says. Items are often shipped from Anchorage to Kodiak on the air carrier—at no extra cost to the patient, she says. “It’s not the patient’s fault, it’s just something special that is needed,” she says. “We don’t do any up charge for the transportation.”

www.akbizmag.com

Teaching Logistics to Today’s Workers and the Next Generation Anchorage is a logistics hub for the state and also a training ground for tomorrow’s logistics managers. In the late 1990s former Anchorage Mayor Rick Mystrom contacted the dean of the University of Alaska Anchorage at the time, Hayden Green, and the pair lined up industry sponsors to help develop a logistics program, says Price. The department provides training geared to individuals already working in logistics and to students in Anchorage and Mat-Su Borough technical schools. High school students can take two logistics courses for six university credits, Price says. The department offers several levels of training, from an occupational endorsement for people new to logistics to an associate degree, undergraduate certificate, and even a master’s degree in supply chain management. It was set up to help students advance easily. Price says about forty students are currently enrolled in the occupational endorsement courses, plus another

twenty-four who are taking distance learning courses from the North Slope and elsewhere. Another forty are in the undergraduate program and eighteen are working through their master’s degree, he says. The department is working with Alaska Housing Finance Corporation to provide training for people who are receiving rent subsidies in the interest of boosting their incomes and helping them exit subsidized housing, Price says, and with Cook Inlet Housing Authority to train employees. “The logistics department is looking at what we can do to help the workforce move forward,” he says. Shaw is a graduate of the UAA Logistics department and says his degree was essential in his getting hired as the managing director. Shaw had an undergraduate degree from the University of Memphis and worked there for FedEx. He transferred to Alaska as a manager and was promoted to senior management, but to get further, he was told he needed to get a master’s degree. He did and, when the position of managing director for Fe-

Your stuff will make it to port, even if you can’t.

dEx Express came open, he got it. “That degree helped me get the interview,” he says. And the information has been valuable, he added. While studying at UAA, Shaw said his cohorts in the class—a truck driver from Carlile, a senator’s aide, students from Seattle— all provided different real-world perspectives that boosted his knowledge of the field tremendously. “I think UAA did a great job lining up what the global perspective is in the supply chain process,” Shaw says. Shaw isn’t alone—other FedEx employees have used the company’s tuition waiver program to go through the program and have been promoted from hourly employees to management. Shaw also teaches in the UAA logistics program as an adjunct professor. “I try to give back,” Shaw says, “from the perspective of a business that operates within the Alaska community, and someone who is invested in the success of our university.”  Rindi White is a freelance journalist living in Palmer.

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Meeting yours is everything else. April 2014 | Alaska Business Monthly

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special section

Corporate 100—Top Citizens of Industry

Top Citizens of Industry—Alaska Business Monthly’s

2014 Corporate 100

e salute the 2014 Corporate 100—Top Citizens of Industry! Something the companies have in common from year-to-year is a commitment to community and volunteerism. This year is no exception. In addition, these corporations share the business acumen to make an economic impact across the state. As usual, Afognak Native Corp./Alutiiq 215 Mission Rd., Suite 212 Kodiak, AK 99503

we have a sampling of companies from more than a dozen economic sectors represented in the Corporate 100. The number of employees ranges wide, from the likes of Providence Health & Services Alaska (4,229) and Arctic Slope Regional Corporation (4,175) to Linc Energy (20) and Foss Maritime Company (24). Some com-

panies aren’t headquartered here, but have been established in Alaska for many years, since 1867 in the case of Alaska Commercial Co., 1922 in the case of Foss. Also established in 1922 is First National Bank Alaska, a shining example of a company headquartered in the state. About a quarter of the companies have been doing business in Alaska since before statehood. That’s staying power. We added a topic to the survey this year and received an overwhelming response, so “Economic Impact of the Corporate 100” is presented later in this special section. Congratulations to Alaska Business Monthly’s 2014 Corporate 100: Top Citizens of Industry! 

ACTIVITIES: Government contracting, oilﬁeld services, bio-renewable energy, and construc- Year Founded: 1977 Estab. in Alaska: 1977 tion.

907-762-9457

COMMUNITY: Alutiiq Museum, Native Village of Afognak, Junior Achievement of Alaska, Port Employees & Revenue: Alaska: 189 Lions School, Special Olympics, Alaska Native Justice Center and more. Worldwide: 4,600

Dusty Kaser, President/CEO

afognak.com | info@alutiiq.com

Alaska Native Organization

Ahtna, Inc. PO Box 649 Glennallen, AK 99588 907-822-3476 Michelle Anderson, President

ACTIVITIES: Ahtna’s principal activities include design-build, engineering & construction; envi- Year Founded: 1972 ronmental remediation; facilities management & support; food service contractors; land man- Estab. in Alaska: 1972 agement & resource development; training range operations; and oil & gas pipeline services.

Employees & Revenue

COMMUNITY: Ahtna regularly provides donations and contributions to charitable and cultur- Alaska: 308 al organizations, including the Ahtna Heritage Foundation, a Glennallen-based nonproﬁt that Worldwide: 1,668 offers scholarships to Ahtna shareholders as well as other programs aimed at cultural preserAlaska: $200.00M vation and language revitalization. Global: $200.00M

Alaska Native Organization

ahtna-inc.com | ituimalealiifano@ahtna.net

Alaska Airlines 4750 Old Int’l Airport Rd. Anchorage, AK 99502

ACTIVITIES: Alaska Airlines and its sister carrier, Horizon Air, together, provide passenger and Year Founded: 1932 Estab. in Alaska: 1932 cargo service to more than 95 cities in Alaska, Canada, Mexico, Hawaii, and the Lower 48.

907-266-7200 Marilyn Romano, Reg. VP Alaska Transportation

Alaska Commercial Co. 550 W. 64th Ave. Anchorage, AK 99518 907-273-4600 Rex Wilhelm, President/COO Retail & Wholesale Trade 110

COMMUNITY: Alaska Airlines and Horizon Air partners with local and regional nonproﬁt or- Employees & Revenue Alaska: 1,700 ganizations on an ongoing basis and encourages and supports our employees in their efforts to Worldwide: 12,750 make a difference in Alaska communities through volunteerism. alaskaair.com

Global: $4.96B

ACTIVITIES: Rural Alaska’s largest retailer of food, apparel, and general merchandise with Year Founded: 1867 Estab. in Alaska: 1867 continuous service since 1867. COMMUNITY: Major sponsor of ASAA, Boy and Girl Scouts of America; American Diabetes Employees & Revenue Alaska: 900 Association; Muscular Dystrophy Association; Immunize Alaska, and numerous local events Worldwide: 1,500 and charities across rural Alaska. alaskacommercial.com | rwilhelm@northwest.ca

Alaska Business Monthly | April 2014

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BusinessPROFILE

Photo Courtesy of Colonial Life

Colonial Life & Accident Insurance Co.

Colonial Life enrolling first ASCI (Advanced Supply Chain International) employee on the North Slope.

olonial Life has provided voluntary benefits and services to Alaskan businesses for more than 40 years, and it’s exciting to share that there is a new local district office in place to help employers looking for ways to enhance their benefits program, implement cost-control strategies and lighten their benefits administration burden. Pamela Whitfield is President of Whitfield Benefit Solutions and District General Agent with Colonial Life. Pamela says, “Never have I seen a greater need for our programs and services than in Alaska. Healthcare costs have led employers to raise deductibles and cut back on the benefits they offer employees. With Colonial Life, there is tremendous opportunity for them to give employees access to ‘basic financial protection,’ not only at no direct cost to the company but without changing any of the benefits in place already.” Colonial Life & Accident Insurance Company is a market leader in providing benefits solutions in one neat package: excellence in communications, enrollments, service, and personal insurance products and services that help America’s workers protect what they’ve worked so hard to build.

For employees whose insurance plans leave them feeling vulnerable, Colonial Life can help restore peace of mind through personal insurance products that complete their coverage, all at no direct cost to a company. Colonial Life is committed to Alaska. We offer a broad line of personal insurance products including disability, accident, life, cancer, critical illness, and hospital confinement. Colonial Life serves over 79,000 businesses, has more than 3 million policies in force and has consistently strong industry ratings. Pamela is a 12-year veteran manager with Colonial Life and is not new to Alaska. In her early 20s Pamela spent two years as a trapper in Kodiak, a fisherman and a lead deckhand in large tender vessels all over Alaska. Pamela always wanted to come back to Alaska and this expansion presented a great opportunity to do that. Her team has garnered such clients as Beans Café, Alaska Heart & Vascular Institute, Fresh Ale Pubs, and Advanced Supply Chain International (ASCI) to name a few. Steve Mierop, CFO of Three Bears Grocery, had this to say of their experience with Colonial Life: “Switching to Colonial Life is the best thing that –

P A I D

A D V E R T I S E M E N T

–

Three Bears has ever done in terms of voluntary benefits. Pam Whitfield and her great staff have always been thoroughly professional and super responsive. And on top of that, the switch to Colonial Life enabled us to offer valuable benefits and competitive pricing to our employees. Working with Pamela and her crew has been a huge win for Three Bears and especially for our employees.” The Whitfield Benefit Solutions Midtown team knows that a sound benefits package is a plus, particularly in today’s times—but only if employees know and understand what you make available to them. Colonial Life’s full service enrollments don’t simply help employees enroll, they engage them in your benefits programs. Colonial Life products are underwritten by Colonial Life & Accident Insurance Company, for which Colonial Life is the marketing brand.

For more information please contact: Pamela Whitfield, President Whitfield Benefit Solutions 907-274-0227 Pamela.Whitfield@coloniallife.com

special section

Corporate 100â&#x20AC;&#x201D;Top Citizens of Industry

Alaska Communications 600 Telephone Ave. Anchorage, AK 99503 907-297-3000

ACTIVITIES: Alaska Communications is a leading provider of high-speed wireless, mobile Year Founded: 1999 broadband, Internet, local, long-distance and advanced data solutions to consumers and busi- Estab. in Alaska: 1999 nesses across Alaska.

Employees & Revenue Alaska: 832 COMMUNITY: Through corporate donations and employee volunteer work, we give back to Worldwide: 855

Anand Vadapalli, President/CEO

help build a better Alaska. Programs include Employee Volunteer Grants, Summer of Heroes Youth Awards and a United Way Campaign. Alaska: $341.52M

Telecommunications

alaskacommunications.com | letsbetteralaska@acsalaska.com

Alaska Industrial Hardware Inc. 2192 Viking Dr. Anchorage, AK 99501

ACTIVITIES: Industrial/Constructions supplies; Power Tools; Hand Tools; Safety; Fasteners; Year Founded: 1959 Estab. in Alaska: 1959 Maintenance & Janitorial; Material Handling; Outerwear

Global: $341.52M

Employees & Revenue Alaska: 200 Worldwide: 200

Mike Kangas, President/Gen. Mgr.

COMMUNITY: Donate to: United Way; Alaska Peace OfďŹ cers Association; STAR Alaska; Iron Dog Snow Machine Race; Willow JR. 100 Sled Dog Race; Members of: Alaska General Contractors Association; Business Owners and Managers Association; Alaska Economic Development Council; Alaska Home Builders Association

Retail & Wholesale Trade

aih.com | info@aih.com

Alaska Regional Hospital 2801 DeBarr Rd. Anchorage, AK 99508

ACTIVITIES: 24-hour ER department, family birth center, LifeFlight Air Ambulance, cancer Year Founded: 1963 center, neuroscience center, diagnostic imaging, heart center & cardiac rehabilitation, ortho- Estab. in Alaska: 1963 pedic & spine center, sleep lab, rehab unit, kids care unit, daVinci surgical robot, nurse resiEmployees & Revenue dency program, surgical services.

907-276-7201

907-276-1131 Julie Taylor, CEO

Alaska: $57.40M Global: $57.40M

Alaska: 850

COMMUNITY: Our community involvement includes: American Heart Association, Red Cross, Worldwide: 850 Blood Bank of Alaska, American Cancer Society, free immunization clinic, free community health fairs & seminars, Chamber of Commerce, and more.

Healthcare

alaskaregional.com | facebook.com/alaskaregional

Alaska USA Federal Credit Union PO Box 196613 Anchorage, AK 99519-6613

ACTIVITIES: Financial services including: consumer and commercial deposit and loan services, Year Founded: 1948 as well as mortgage and real estate loans, insurance, investments and investment manage- Estab. in Alaska: 1948 ment, and title and escrow closing services.

907-563-4567 William Eckhardt, President

COMMUNITY: Donated to more than 200 community/service organizations statewide. Helps Worldwide: 1,915 raise money for the Alaska USA Foundation, providing funds for services for children, veterans, and active duty military families. Alaska: $164.60M

Finance, Insurance, Real Estate

alaskausa.org | facebook.com/alaskausafcu

Employees & Revenue Alaska: 1,349

Alaska Village Electric Cooperative Inc. ACTIVITIES: Provide electric power to 55 villages in rural Alaska. 4831 Eagle St. Anchorage, AK 99503 COMMUNITY: We provide donations to various local events and festivals. 907-561-1818

avec.org | mkohler@avec.org

Meera Kohler, President/CEO

Global: $294.17M

Year Founded: 1967 Estab. in Alaska: 1967 Employees & Revenue Alaska: 72 Worldwide: 72 Alaska: $42.21M

Utility

Aleut Corporation 4000 Old Seward Hwy., Suite 300 Anchorage, AK 99503

ACTIVITIES: Federal government contracting, Fuel sales, storage and related services, Rental Year Founded: 1972 properties, Natural resources, Industrial instrumentation & process control equipment sales, Estab. in Alaska: 1972 Oil well-testing services, Mechanical contracting & construction, Water quality testing, Other

907-561-4300 David Gillespie, CEO

COMMUNITY: The Aleut Corporation works with many civic and business constituents, including, but not limited to its village corporations, tribes, Aleutian Pribilof Islands Assoc., Eastern Aleutian Tribes, APICDA, etc. Global: $116.26M

Alaska Native Organization

aleutcorp.com | info@aleutcorp.com

112

Employees & Revenue Alaska: 185 Worldwide: 623

Alaska Business Monthly | April 2014

www.akbizmag.com

We work here ^^^

so that it works here

Portage Cove, Haines, AK

Ahtna Region, AK

^^^

As the business holding company of Ahtna, Inc., an Alaska Native Regional Corporation based in Glennallen, Alaska, Ahtna Netiye’ is strongly committed to ensuring the prosperity of Ahtna shareholders through the revenues and profits we acquire from our business operations. So, not only are we helping our clients achieve success in their business ventures, we’re also providing viable economic opportunities for our people and region. That’s just how we do business.

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

Netiye’, Inc. 110 W 38 Street, Suite 100B | Anchorage, AK 99503 PH: (907) 868-8250 | FAX: (907) 868-8285 th

Learn more about doing business with Ahtna at www.ahtna-inc.com

special section

Corporate 100—Top Citizens of Industry

Alyeska Pipeline Service Co. PO Box 196660, MS 542 Anchorage, AK 99519-6660 907-787-8700 Thomas Barrett, President

ACTIVITIES: Alyeska Pipeline Service Company has operated the Trans Alaska Pipeline Sys- Year Founded: 1970 tem since 1977, expected to deliver its 17 billionth barrel of oil in 2014. Focused on safe and Estab. in Alaska: 1970 ﬂawless operations and sustainability, Alyeska’s employees are working to manage the chalEmployees & Revenue lenges of declining throughput. Alaska: 800+

COMMUNITY: Alyeska Pipeline honors its special relationship with Alaska’s communities through a Worldwide: 800+ robust philanthropy program, which includes donations to qualifying Alaska nonproﬁts and support for employee volunteerism. The company also offers internships and supports various scholarships.

Oil & Gas

alyeska-pipe.com | facebook.com/alyeskapipeline

Alyeska Resort PO Box 249 Girdwood, AK 99587

ACTIVITIES: 304 room hotel, 7 restaurants, ski resort, full service spa, banquet and meeting Year Founded: 1959 Estab. in Alaska: 1959 facilities.

Mark Weakland, VP/Hotel GM

COMMUNITY: Various military programs (i.e., Military Monday, JBER), discounted skiing for Employees & Revenue Alaska: 700 Girdwood School PE. On-mountain relationships with Challenge Alaska adaptive ski program Worldwide: 700 and Alyeska Ski Club racing program. Numerous donations to local businesses and sponsored athlete programs.

Travel &Tourism

alyeskaresort.com | info@alyeskaresort.com

American Fast Freight, Inc. 5025 Van Buren St. Anchorage, AK 99517

ACTIVITIES: Ocean and air freight forwarding, LTL and FTL, household moving and storage, Year Founded: 1988 short-term and long-term warehousing, distribution, temperature controlled transportation, Estab. in Alaska: 1988 Alaska intrastate and Alcan trucking, bypass mail, project logistics, over-dimensional, dry tranEmployees & Revenue sit.

907-754-1111

907-248-5548 Ron Moore, Alaska Sales Mgr. Transportation

American Seafoods Group LLC 1362 Ballyhoo Road Dutch Harbor, AK 99692

COMMUNITY: American Fast Freight hosts the AGC’s Family Fun Night.

Alaska: 150 Worldwide: 150

americanfast.com | alaska@americanfast.com

ACTIVITIES: Catch and process Bering Sea pollock, Paciﬁc cod, and yellow ﬁn sole. Global sea- Year Founded: 1988 Estab. in Alaska: 1988 food distribution network. Employees & Revenue Alaska: 49 Worldwide: 1,304

Bernt Bodal, CEO/Chairman

COMMUNITY: Member of the Pollock Conservation Cooperative Research Center partnership with UAF—$13 million total donation to ﬁshery research since 2000, as well as support for student tuition and research at APU. American Seafoods Community Advisory Board, support SeaShare donations of seafood to food banks.

Seafood

americanseafoods.com | jan.jacobs@americanseafoods.com

Arctic Slope Regional Corporation PO Box 129 Barrow, AK 99723

ACTIVITIES: Energy support services, petroleum reﬁning and marketing, engineering, con- Year Founded: 1972 struction, government services, resource development, commercial lending, tourism, commu- Estab. in Alaska: 1972 nications, various partnerships, joint ventures, and more.

907-852-8633

COMMUNITY: North Slope speciﬁc and statewide nonproﬁt organizations.

Rex A. Rock Sr., President/CEO

asrc.com

907-581-3010

Alaska: $300.00M Global: $470.00M

Employees & Revenue Alaska: 4,175 Worldwide: 10,082

Alaska Native Organization

AT&T 505 E. Bluff Dr. Anchorage, AK 99501 800-478-9000 Bob Bass, President - Alaska Telecommunications 114

ACTIVITIES: Connecting people with their world everywhere they live and work, and doing Year Founded: 1876 it better than anyone else. Solutions include mobility, data, voice, cloud services, application Estab. in Alaska: 1971 management and managed security.

Employees & Revenue

COMMUNITY: AT&T invests signiﬁcant resources to advance education, strengthen com- Alaska: 531 munities, and improve lives. During a three-year period, AT&T and its employees contributed Worldwide: 243,360 more than $885,000 through corporate, employee and AT&T Foundation giving programs in Alaska. att.com, facebook.com/ATT | @ATTCustomerCare

Alaska Business Monthly | April 2014

www.akbizmag.com

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special section

Corporate 100—Top Citizens of Industry

BDO USA, LLP 3601 C St., Suite 600 Anchorage, AK 99503 907-278-8878

ACTIVITIES: Tax planning and prep, auditing, compliance audits, ﬁnancial statement prepara- Year Founded: 1910 tion, business valuation, litigation support, personal ﬁnancial planning, estate planning, fraud Estab. in Alaska: 1977 and forensic acctg, business consulting, audits of Medicaid providers, internal controls and Employees & Revenue Sarbanes Oxley compliance. Alaska: 101 Worldwide: 54,933

James Hasle, Ofﬁce Mng. Ptnr.

COMMUNITY: Bean’s Cafe, Downtown Soup Kitchen, Habitat for Humanity, Adopt-a-Highway, Friday Dress Down for Charity, donations to various local charities.

Finance, Insurance, Real Estate

bdo.com | landersen@bdo.com

Bering Straits Native Corporation 4600 DeBarr Rd., Suite 200 Anchorage, AK 99508

ACTIVITIES: Bering Straits was established by ANCSA in 1971. It is owned by more than 7,100 Year Founded: 1972 Alaska Native shareholders and actively pursues responsible development of resources and Estab. in Alaska: 1972 other business opportunities. The Company serves the federal government and commercial Employees & Revenue customers throughout the Bering Strait region.

907-563-3788 Gail R. Schubert, President/CEO

Alaska: 384

COMMUNITY: Bering Straits supports programs and organizations that provide long-term so- Worldwide: 1,166 lutions and make a difference in the lives of Alaska Native people. Bering Straits also provides Global: $242.00M substantial support to the Bering Straits Foundation

Alaska Native Organization

beringstraits.com | media@beringstraits.com

BP Exploration (Alaska) Inc. PO Box 196612 Anchorage, AK 99515-6612

ACTIVITIES: BP operates 13 North Slope oil fields, four North Slope pipelines, and owns a sig- Year Founded: 1959 Estab. in Alaska: 1959 nificant interest in six other producing fields and in the Trans Alaska Pipeline System.

907-561-5111

COMMUNITY: BP Alaska invests approximately $5 million annually in education programs Employees & Revenue Alaska: 2,300 and community organizations across Alaska. Worldwide: 85,900

Janet Weiss, Regional President

alaska.bp.com

Oil & Gas

Bristol Bay Native Corporation 111 W. 16th Ave., Suite 400 Anchorage, AK 99501 907-278-3602 Jason Metrokin, President/CEO Alaska Native Organization

Calista Corporation 301 Calista Ct., Suite A Anchorage, AK 99518-3028 907-279-5516 Andrew Guy, President/CEO

ACTIVITIES: Construction, government services, oilﬁeld and industrial services, petroleum Year Founded: 1971 Estab. in Alaska: 1972 distribution, and tourism. COMMUNITY: BBNC annually provides support and funding to nonproﬁt organizations and Employees & Revenue Alaska: 1,338 local initiatives that align with our corporate mission and values. BBNC also advocates for a Worldwide: 4,480 number of important causes that preserve and enhance the Alaska Native culture. bbnc.net | info@bbnc.net

Alaska: $152.49M Global: $1.96B

ACTIVITIES: Calista Corporation is the parent company of more than 35 subsidiaries in the Year Founded: 1972 following industries: military defense contracting, construction, marketing and advertising Estab. in Alaska: 1972 services, communications, real estate, environmental and natural resource development, and Employees & Revenue information technology services. Alaska: 400

COMMUNITY: In 2013 Calista Corporation provided more than $5.3 million in beneﬁts to its Worldwide: 1,600 shareholders and descendants. $4.3 million in the form of shareholder dividends, over $405,000 in scholarships, and nearly 80 percent of cash and in-kind donations were distributed in the YK Delta.

Alaska Native Organization

calistacorp.com | calista@calistacorp.com

Carlile Transportation Systems 1800 E. First Ave. Anchorage, AK 99501-1833

ACTIVITIES: Transportation and logistics company offering multi-model trucking as well as Year Founded: 1980 Estab. in Alaska: 1980 project logistic services across Alaska and North America.

907-276-7797 James Armstrong, President

COMMUNITY: Carlile is actively involved in youth education and arts organizations.. carlile.biz | pspittler@carlile.biz

Employees & Revenue Alaska: 550 Worldwide: 725 Alaska: $180.00M

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Carrs Safeway 5600 Debarr Rd., Suite 100 Anchorage, AK 99504

ACTIVITIES: Retail food, drug and fuel.

Year Founded: 1901 Estab. in Alaska: 1950

907-339-7704

COMMUNITY: Fundraising for MDA, Prostate Cancer, Breast Cancer, Special Olympics. In addition to Business School Partnerships with our local stores we also are committed to hiring Employees & Revenue Alaska: 2,915 and training current and former military personnel. Worldwide: 160,000

Glenn Peterson, Denali Dist. Mgr.

safeway.com

Retail/Wholesale Trade CCI Industrial Services, LLC 560 E. 34th Ave., Suite 200 Anchorage, AK 99503-4161 907-258-5755 A. Ben Schoffmann, President/CEO

ACTIVITIES: Corrosion-under-insulation refurbishment; asbestos and lead surveys and abate- Year Founded: 1989 ment; specialty coatings; sandblasting; tank and vessel cleaning; ďŹ re prooďŹ ng; demolition and Estab. in Alaska: 1989 hazardous waste removal; operations, maintenance, and construction; oil spill response; heat Employees & Revenue treat services. Alaska: 250

COMMUNITY: CCI Industrial contributes to the community and to industry through work- Worldwide: 250 force development and cultivating well-trained employees who embrace our safety leadership values.

Industrial Services

cciindustrial.com | info@cciindustrial.com

Central Peninsula Hospital 250 Hospital Pl. Soldotna, AK 99669

ACTIVITIES: CPH is a Planetree designated hospital offering emergency medical care, surgery, Year Founded: 1971 family birth center, imaging, laboratory, physical therapy and behavioral health. Specialties in- Estab. in Alaska: 1971 clude: ENT, neurology, orthopedics, pediatrics, pain, family medicine, general surgery and inEmployees & Revenue ternal medicine.

907-714-4404 Rick Davis, CEO Healthcare

www.akbizmag.com

Alaska: 772

COMMUNITY: CPH prides itself on maintaining a community-oriented focus by offering con- Worldwide: 772 tinuing medical education, general health education, free and reduced cost health screenings, Alaska: $228.84M and comprehensive behavioral health prevention services. cpgh.org | marketing@cpgh.org

Global: $233.31M

April 2014 | Alaska Business Monthly

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Corporate 100—Top Citizens of Industry

CH2M HILL 949 E. 36th Ave., Suite 500 Anchorage, AK 99508

ACTIVITIES: Premier Alaskan oil and gas contractor; offering consulting, engineering, procurement, logis- Year Founded: 1946 tics, fabrication, construction, construction management, operations and maintenance service all under Estab. in Alaska: 1962 one roof; supporting oil and gas, mining, environmental, water, power, transportation and government.

907-762-1500 Terry Bailey, Sr. VP, Alaska Regional Manager

COMMUNITY: Fund for the Future, Habitat for Humanity, Bean’s Cafe, Water for People, Unit- Alaska: 2,456 ed Way, March of Dimes, Boys & Girls Clubs of Alaska, Children’s Lunchbox, Covenant House, Worldwide: 26,175 CANstruction, American Heart Association, American Red Cross, Special Olympics, and Lake Otis School-Business Partnership.

Industrial Services

ch2m.com/alaska | bclemenz@ch2m.com

Chenega Corporation 3000 C St., Suite 301 Anchorage, AK 99503-3975

ACTIVITIES: Professional services contracting for the federal government, including technical and instal- Year Founded: 1974 lation services, military, intelligence and operations support, environmental, healthcare and facilities mgt., Estab. in Alaska: 1974 information technology, electrical, telecommunications and power generation services. Three hotels.

907-277-5706 Charles W. Totemoff, President/CEO

Employees & Revenue

COMMUNITY: Each year, approx. $350,000 is distributed to Chenega shareholders and de- Alaska: 440 scendants in the form of scholarships, a majority of which go to educational institutions in Worldwide: 5,360 Alaska. Our Alaska-based hotels and electrical/telecommunications/power generation subsidGlobal: $1.05B iaries support local businesses as suppliers.

Alaska Native Organization

chenega.com | info@chenega.com

Chugach Alaska Corporation 3800 Centerpoint Dr., Suite 700 Anchorage, AK 99503-4396

ACTIVITIES: Chugach provides wide-ranging services for federal, municipal and commercial Year Founded: 1972 clients including facilities management and maintenance, construction and engineering, tech- Estab. in Alaska: 1972 nical and information technology, education and oil and gas services.

907-563-8866 Gabriel Kompkoff, CEO

Employees & Revenue

COMMUNITY: Chugach supports the Alaska community through contributions to local educa- Alaska: 500 tional institutions such as University of Alaska Anchorage and Alaska Paciﬁc University; Alaska Worldwide: 4,300 Native Organizations such as Alaska Federation of Natives and Native Youth Olympic Games; Alaska: $51.00M and non-proﬁts such as YWCA and KNBA.

Global: $607.00M

Alaska Native Organization

chugach.com | communications@chugach.com

Coeur Alaska Inc. 3031 Clinton Dr., Suite 202 Juneau, AK 99801

ACTIVITIES: The Kensington underground gold mine and associated milling facilities are Year Founded: 1987 located within the Berners Bay Mining District on the east side of the Lynn Canal about 45 Estab. in Alaska: 1987 miles north-northwest of Juneau, Alaska. The project is wholly owned and operated by Coeur Employees & Revenue Alaska, Inc., a wholly owned subsidiary of Coeur Mining, Inc.

907-523-3300 Wayne Zigarlick, VP/Gen. Mgr.

Alaska: 306

COMMUNITY: Understanding the needs of our communities is vital to forming long-term Worldwide: 1,900 partnerships. Coeur and our employees’ investments support our local communities in a variety of ways including in-kind contributions, volunteer time, sponsorships and donations.

Mining

coeur.com | jtrigg@coeur.com

Colville Inc. Pouch 340012 Prudhoe Bay, AK 99734

ACTIVITIES: Colville’s group of oilﬁeld companies provide a full complement of Arctic Logistics Year Founded: 1981 capabilities. Our services include fuel, aviation, waste management, transport, industrial sup- Estab. in Alaska: 1981 ply and camp services.

907-659-3198

COMMUNITY: Colville has provided arctic logistics services for over 60-years. Our North Worldwide: 200 Slope based companies are committed to keeping Alaska a great place to work and live.

Eric Helzer, President/CEO Industrial Services

ConocoPhillips Alaska, Inc. PO Box 100360 Anchorage, AK 99510

Employees & Revenue Alaska: 200

colvilleinc.com | info@colvilleinc.com

ACTIVITIES: Exploration and Production

Alaska: $113.00M Global: $113.00M

Year Founded: 1952 Estab. in Alaska: 1952

907-276-1215

COMMUNITY: Total philanthropic spend for 2012 was more than $6.5 million - more than $106 million donated to Alaska nonproﬁts since 2000. On average, more than 7,000 employee Employees & Revenue Alaska: 1,200 volunteer hours per year. Worldwide: 18,400

Trond-Erik Johansen, President

conocophillips.com | COPAlaskaInfo@ConocoPhillips.com

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Construction Machinery Industrial 5400 Homer Dr. Anchorage, AK 99518

ACTIVITIES: Construction and mining equipment sales, rentals, service, and parts.

Year Founded: 1985 Estab. in Alaska: 1985

COMMUNITY: Habitat for Humanity: volunteers and ﬁnancial assistance. Alaska Miners AsEmployees & Revenue sociation and Alaska General Contractors Association.

907-563-3822

Alaska: 105 Worldwide: 105

cmiak.com | o.prestwick@cmiak.com

Ken Gerondale, President/CEO

Alaska: $124.00M Global: $124.00M

Industrial Services Credit Union 1 1941 Abbott Rd. Anchorage, AK 99507

ACTIVITIES: Credit Union 1 values responsible, accessible lending as one of our most vital Year Founded: 1952 community services. We’re proud to offer quality loans to match our members’ unique needs Estab. in Alaska: 1952 and lifestyle, and our many electronic services represent the cutting edge of personal money Employees & Revenue management at your ﬁngertips. Alaska: 327

907-339-9485

COMMUNITY: Credit Union 1 is a uniquely philanthropic ﬁnancial institution. Each year, we teach, build, Worldwide: 330 fundraise, and volunteer in our Alaskan communities! Our wide-ranging social activities and ﬁnancial Alaska: $52.62M services represent the heart of the credit union movement — a movement for people helping people.

Tom Newins, President/CEO

Global: $52.62M

Finance, Insurance, Real Estate

cu1.org | service@cu1.org

Crowley Solutions 201 Arctic Slope Ave. Anchorage, AK 99518

ACTIVITIES: Crowley Solutions was formed in 2010 to provide increased support services to Year Founded: 1892 the oil and gas industry including turnkey project management solutions, ocean towing, heavy Estab. in Alaska: 1953 lift transportation services, spill response services, tanker escort and docking services in ValEmployees & Revenue dez.

907-777-5505 Bruce Harland, VP

COMMUNITY: Crowley has been operating for over 60 years in Alaska and supports local communities and the events that celebrate life in Alaska.

Transportation

crowley.com

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www.akbizmag.com

Alaska: 500 Worldwide: 5,400

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Stay connected & sign up for email alerts at www.PenAir.com

April 2014 | Alaska Business Monthly

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Corporate 100—Top Citizens of Industry

Cruz Construction 7000 E. Palmer Wasilla Hwy. Palmer , AK 99645 907-746-3144

ACTIVITIES: Specializing in heavy civil construction and remote work locations throughout Year Founded: 1990 the state of Alaska. Oilﬁeld support services and support, ice roads, ice pads, transportation Estab. in Alaska: 1990 and rig support.

Employees & Revenue Alaska: 192 COMMUNITY: Iditarod, AK Ladies Charity Shot Gun Class, Beans Cafe, Iron Dog, Iditarod, Worldwide: 361

Dave Cruz, President

Mat-Su Junior Achievement, PHS Wrestling, Pioneer Amateur Hockey Association, Colony Day’s, Colony Christmas, Anchorage Symphony, FFA, 4-H clubs.

Industrial Services

cruzconstruction.com | info@cruzconstruct.com

Davis Constructors & Engineers, Inc. 740 Bonanza Ave. Anchorage, AK 99518

ACTIVITIES: Commercial construction and design-build. Current Projects: UAF Engineering, Cook Inlet Hous- Year Founded: 1976 ing Mountain View Village, CLDC Fireweed Business Center, Kodiak Long Term Care Facility, Penland Parkway Estab. in Alaska: 1976 upgrades, Transitional Care Center, Providence Generations Tower M, C Street and International Ofﬁce

907-562-2336 Josh Pepperd, President

Employees & Revenue

COMMUNITY: Davis is a national fundraising leader for the American Cancer Society. Since 2007, Davis Alaska: 100 has raised over $850,000 during the Relay for Life Campaign. Davis also contributes locally to: NAWIC, Worldwide: 100 CanStruction Competition, Healthy Alaska Natives Foundation, Covenant House, YWCA,& CITC’s ChanAlaska: $163.64M lyut Program

Construction

davisconstructors.com | admin@davisconstructors.com

Delta Western Inc. 420 L St., Suite 101 Anchorage, AK 99501

ACTIVITIES: Fuel and lubricant distribution.

800-478-2688

deltawestern.com

COMMUNITY: $10k annual college scholarships given at each terminal location.

Global: $163.64M

Year Founded: 1985 Estab. in Alaska: 1985 Employees & Revenue Alaska: 100 Worldwide: 120

Kirk Payne, President Transportation

Denali Alaskan Federal Credit Union 440 E. 36th Ave. Anchorage, AK 99503

ACTIVITIES: Complete ﬁnancial services for Alaskans. Coming in 2014—Business Services for Year Founded: 1948 Alaska small businesses. In addition to lending and savings options, we have Investment Ser- Estab. in Alaska: 1948 vices, Mortgage, and Insurance products.

907-257-7200

COMMUNITY: Annually, we provide thousands of dollars and many hours of staff time to sup- Worldwide: 323 port local businesses. Find out more at our “community counts” website: denalifcu.org/cc.html

Robert Teachworth, President/CEO Finance, Insurance, Real Estate

Doyon, Limited 1 Doyon Pl., Suite 300 Fairbanks, AK 99701-2941 907-459-2000

Employees & Revenue Alaska: 323

denalifcu.org | info@denalifcu.com

Alaska: $44.90M Global: $44.90M

ACTIVITIES: A regional Native corporation that operates a diverse family of companies in Year Founded: 1972 Alaska and across the nation, providing services in the areas of oil ﬁeld services, government Estab. in Alaska: 1972 contracting, land/ natural resource development, utility management, security, engineering, Employees & Revenue facility, construction and tourism. Alaska: 1,704 Worldwide: 2,988

Aaron Schutt, President/CEO

COMMUNITY: Doyon Foundation, Alaska Native Heritage Center, WEIO, ANSEP, United Way, American Heart Association, Relay for Life and many other civic and charitable groups. Alaska: $203.69M

Alaska Native Organization

doyon.com, Facebook, Twitter, LinkedIn | info@doyon.com

ENSTAR Natural Gas Co. PO Box 190288 Anchorage, AK 99519

ACTIVITIES: Alaskans have relied on ENSTAR to provide natural gas to their homes and busi- Year Founded: 1961 nesses for nearly a half century. An executive team, with more than 140 years of utility experi- Estab. in Alaska: 1961 ence, manages ENSTAR locally. Our employees deliver safe, dependable, and reliable service to Employees & Revenue our customers 365 days a year.

907-277-5551 Colleen Starring, President Utility 120

Global: $318.55M

Alaska: 195

COMMUNITY: ENSTAR’s goal is to engage, support and improve the neighborhoods where our Worldwide: 195 customers and employees live and work. Each year ENSTAR and its employees donate time and resources to more than 70 different charitable organizations throughout Southcentral Alaska. enstarnaturalgas.com | info@enstarnaturalgas.com

Alaska Business Monthly | April 2014

www.akbizmag.com

Era Helicopters LLC 6160 Carl Brady Dr., Hangar 2 Anchorage, AK 99502 907-550-8600 Elliott Neal, Vice President - Alaska

ACTIVITIES: Founded in Alaska in 1948, Era not only serves the oil and gas industry in Alaska, but Year Founded: 1948 provides services for geological surveys, university studies concerning global warming and wild- Estab. in Alaska: 1948 life impact, state and government business, executive charter services and ﬂight-seeing tours.

Employees & Revenue

COMMUNITY: Through donations and community involvement in Alaska and across the US, Alaska: 130 Era supports many worth-while causes. Era is currently a member of The Anchorage Chamber Worldwide: 1,000 of Commerce, the Alaska Air Carriers Association, the Alliance, and the Alaska Search and Rescue Association among others.

Transportation

erahelicopters.com | pgargan@erahelicopters.com

Fairbanks Memorial Hospital 1650 Cowles St. Fairbanks, AK 99701

ACTIVITIES: General medical and surgical hospital, home care, hospice, behavioral health, can- Year Founded: 1972 cer center, pain clinic, sleep disorders lab, cardiology, medical imaging center, rehabilitation, Estab. in Alaska: 1972 and long-term care.

907-452-8181

COMMUNITY: Partners with the United Way and American Heart Association. Works with Worldwide: 1,200 community partners to better address alcohol and drug abuse issues.

Mike Powers, CEO Healthcare

Employees & Revenue Alaska: 1,200

fmhdc.com | clover.tiffany@bannerhealth.com

Fairweather LLC 9525 King St. Anchorage, AK 99515

ACTIVITIES: Founded in 1976 by Sherron Perry, Fairweather offers a range of highly-specialized services to sup- Year Founded: 1976 port remote oil and gas, and mining operations. These services include remote medical and HSE support, me- Estab. in Alaska: 1976 teorological and oceanographic forecasting, aviation and airstrip support, and expediting and logistics services.

907-346-3247 Lori Davey, General Manager

COMMUNITY: Fairweather currently supports many local charities including Habitat for Humanity, Nature Conservancy, United Way, Covenant House, Bean’s Cafe, Children’s Lunchbox, and many others. Fairweather’s executives serve on boards for Covenant House, Nature Conservancy, United Way, and Anchorage 90 by 2020.

Industrial Services

fairweather.com

www.akbizmag.com

Employees & Revenue Alaska: 140 Worldwide: 140

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Corporate 100—Top Citizens of Industry

FedEx Express 6050 Rockwell Ave. Anchorage, AK 99502 800-463-3339 Dale Shaw, Managing Dir. Transportation

First National Bank Alaska PO Box 100720 Anchorage, AK 99510-0720 907-777-4362 Betsy Lawer, President

ACTIVITIES: Air cargo and express-package services.

COMMUNITY: In 2013 employees at FedEx Express were involved in numerous community service activities—over 1,000 volunteer hours. We participated in events with Anchorage Park Employees & Revenue Alaska: 553 Foundation, March of Dimes, United Way, Food Bank of Alaska, MS Society, Safe Kids Alaska, Worldwide: 160,000 American Diabetes Association and many more. fedex.com

ACTIVITIES: Finance, Insurance, Real Estate

907-782-4950 Gary Faber, President, Global Services

Year Founded: 1922 Estab. in Alaska: 1922

COMMUNITY: More than $1.5 million in contributions, including donations, sponsorships, low Employees & Revenue income housing investments and in-kind donations were given in Alaska. FNBAlaska.com | marketing@FNBAaska.com

Alaska: 694 Worldwide: 694

Alaska: $131.01M Global: $131.01M

Finance, Insurance, Real Estate

Foss Maritime Company 188 W Northern Lights Blvd, Ste 1020 Anchorage, AK 99503

Year Founded: 1973 Estab. in Alaska: 1988

ACTIVITIES: Foss offers tug and barge support services, contract towing, offshore support, Year Founded: 1889 and oil development project support. We also partner with the energy services arm of the Arc- Estab. in Alaska: 1922 tic Slope Regional Corporation to assist with petroleum ﬁeld production in the North Slope Employees & Revenue while safeguarding the environment. Alaska: 24

COMMUNITY: Foss supports local organizations through several means of contributions – Worldwide: 1,500 corporate charitable contributions, volunteer activities, in-kind donations and matching contributions.

Transportation

foss.com | info@foss.com

Franz Bakery 2248 Spenard Road Anchorage, AK 99503

ACTIVITIES: Franz Bakery is a fourth generation family owned baking company based out of Year Founded: 1906 Portland Oregon. Since 1906 Franz has been providing communities with fresh bread, buns, Estab. in Alaska: 2013 bagels and cookies, using the highest quality ingredients. Today, we deliver fresh baked goods Employees & Revenue daily to our customers.

907-277-3190

Alaska: 100

Larry Brandt, General Manager Alaska Division

COMMUNITY: Franz strives to get involved in the community and give back whenever possible. Worldwide: 4,000 Some of the highlights of are community involvement include: Big Wild Life Run, The Christmas Lighting, Fire and Ice. We also donate to many charities including Bother Francis and Bean Cafe.

Manufacturing

franzbakery.com | facebook.com/franzbakery

GCI 2550 Denali St., Suite 1000 Anchorage, AK 99503

ACTIVITIES: Integrated communications provider offering facilities-based local and long dis- Year Founded: 1979 tance telephone services, Internet and TV services, statewide wireless service, data, video con- Estab. in Alaska: 1979 ferencing, tele-health, enterprise network design and IT professional services support.

907-265-5600 Ron Duncan, CEO

COMMUNITY: Sponsoring over 200 programs and causes each year, GCI believes in connect- Worldwide: 1,900 ing with and making a lasting impact in the communities we serve. GCI Connect is proud to support programs that help build a stronger Alaska.

Telecommunications

gci.com | facebook.com/gciak

Geneva Woods 501 W. International Airport Rd. Suite 1A Anchorage, AK 99516

ACTIVITIES: We have four facilities, Anchorage, Wasilla, Soldotna, and one in Montana. We have Year Founded: 1979 nurses that provide infusion therapy in our infusion suite and in patient homes. We have Pharmacy Estab. in Alaska: 1977 Technicians who deliver medication directly to the home and to care facilities. We also provide HME Employees & Revenue and DME equipment.

907-350-3816 Dan Afrasiabi, President

COMMUNITY: We support the American Cancer Society participating every year in “Taking Strides Against Worldwide: 198 Breast Cancer” event. We help sponsor the “Honor Flights” for WW II Veterans to ﬂy to Washington, DC to view the WW II memorial. Geneva Woods donates all the wheel chairs and helps with the organization. Alaska: $39.00M

Healthcare

genevawoodspharmacy.com | sue.parrott@genevawoods.com

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Employees & Revenue Alaska: 1,900

Alaska: 186

Alaska Business Monthly | April 2014

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Granite Construction Company 11471 Lang St. Anchorage, AK 99515

ACTIVITIES: Public and private heavy civil construction, design-build, construction aggre- Year Founded: 1922 gates, recycled base, warm and hot mix asphalt, road construction, bridges, piling, mine infra- Estab. in Alaska: 1974 structure and reclamation and sitework.

907-344-2593

COMMUNITY: We support The Children’s Lunchbox program of Bean’s Cafe, Special Olympics, MS Walk and Nordic Ski Association of Anchorage and employees’ children’s sports teams.

Derek Betts, VP/Region Mgr. Construction

Employees & Revenue Alaska: 60 Worldwide: 4,000 Global: $2.60B

graniteconstruction.com | alaska.projects@gcinc.com

Gray Line of Alaska 745 W. Fourth Ave. Anchorage, AK 99501

ACTIVITIES: Gray Line of Alaska offers a multitude of vacation options including Denali Year Founded: 1947 Rail Tours, Explorer Tours, Highway Tours, Escorted Tours and single-day sightseeing tours Estab. in Alaska: 1985 throughout Alaska and the Yukon.

206-336-6000 Charlie Ball, President

COMMUNITY: At Gray Line of Alaska, social responsibility is at the core of how we do busi- Worldwide: 838 ness. We have a history of being a contributor to Alaska, supporting more than 180 charitable and civic organizations throughout the 49th state.

Travel & Tourism

graylinealaska.com | reservations@graylineofalaska.com

Great Northwest Inc. PO Box 74646 Fairbanks, AK 99707

ACTIVITIES: Heavy highway civil construction, utilities, paving, landscaping

907-452-5617 John Minder, CEO

Employees & Revenue Alaska: 522

Year Founded: 1976 Estab. in Alaska: 1976

COMMUNITY: Great Northwest is a proud supporter of local activities ranging from youth Employees & Revenue sports teams, American Cancer Society and the Yukon Quest. Alaska: 250 Worldwide: 250

grtnw.com | info@grtnw.com

Construction

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www.akbizmag.com

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Corporate 100—Top Citizens of Industry

Holland America Line 455 Ocean Dock Rd Anchorage, AK 99501

ACTIVITIES: Discover Alaska + the Yukon. Vast, wild, beautiful. The Holland America Line dif- Year Founded: 1873 ference is the way we showcase it. Trust Holland America Line to create three perfect journeys Estab. in Alaska: 1987 that cover everything you need to see. Contact your travel professional today.

877-932-4259 Stein Kruse, President & CEO

COMMUNITY: At Holland America Line, social responsibility is at the core of how we do business. We have a history of being a contributor to Alaska, supporting charitable and civic organizations throughout the Great Land.

Travel & Tourism

hollandamerica.com | facebook.com/HALCruises

Homer Electric Association Inc. 3977 Lake St. Homer, AK 99603

ACTIVITIES: Homer Electric Association is a member-owned electric cooperative serving over Year Founded: 1945 22,420 members on the western Kenai Peninsula from Soldotna, Kenai, Homer and remote Estab. in Alaska: 1945 communities across Kachemak Bay.

907-235-8551

Employees & Revenue Alaska: 778 Worldwide: 1,094

Employees & Revenue Alaska: 158 COMMUNITY: One of the cooperative principals is Commitment to Community. HEA offers Worldwide: 158

Bradley Janorschke, Gen. Mgr.

several Outreach Programs and community events including the Energy & Conservation Fairs, student conservation contest, scholarships, Youth Rally & safety poster contest.

Utility

homerelectric.com | contact_us@homerelectric.com

Horizon Lines LLC 1717 Tidewater Rd. Anchorage, AK 99501-1036

ACTIVITIES: Containership service between Tacoma, WA and Anchorage, Kodiak, and Dutch Year Founded: 1964 Harbor, AK. Linehaul trucking to the Alaska Railbelt. Seasonal feeder barge service to Bristol Estab. in Alaska: 1964 Bay and the Pribilofs. Connecting carrier service to other water, air, and land carriers.

907-274-2671 Marion Davis, VP & Gen. Mgr., Alaska Division

COMMUNITY: Iditarod & Skunk’s Place Kennel, Special Olympics AK & WA, Food Bank of AK, Alaska: 260 Covenant House, AK State Fair, March of Dimes, Boys & Girls Clubs of AK, Multiple Sclerosis Worldwide: 1,800 Society, American Legion Baseball, local high school sports, Anchorage Chamber of Commerce, AEDC, KEEP Alaska Competitive.

Transportation

horizonlines.com

Jacobs 4300 B St., Suite 600 Anchorage, AK 99503

ACTIVITIES: Professional services provider to federal and energy clients. AK services include Year Founded: 1947 environmental permitting, compliance, investigation & remediation; energy conservation; lo- Estab. in Alaska: 1993 gistics; upstream design; feasibility analysis & construction management.

907-563-3322 Terry Heikkila, Dir. AK Ops

COMMUNITY: AWAIC beneﬁt Ski 4 Women, Angel Tree Program, United Way, Special Olym- Worldwide: 70,000 pics, AK Polar Plunge, Relay for Life, Bike to Work, Society of American Military Engineers scholarships, and Girl Scouts Women of Science and Technology. Global: $11.80B

Industrial Services

jacobs.com

Kakivik Asset Management, LLC 560 E. 34th Ave., Suite 200 Anchorage, AK 99503-4161

ACTIVITIES: Kakivik is a full service industrial asset integrity management company special- Year Founded: 1999 izing in Nondestructive Testing (NDT), External and Internal Corrosion Investigations, Qual- Estab. in Alaska: 1999 ity Program Management and Field Chemical and Corrosion Management including chemical Employees & Revenue laboratory and coupon/probe operations.

907-770-9400 A. Ben Schoffmann, President/CEO

Employees & Revenue

Employees & Revenue Alaska: 70

Alaska: 200

COMMUNITY: Kakivik’s primary community involvement is through our efforts at workforce develop- Worldwide: 200 ment. We are highly committed to providing training and professional development to those in our industry by maintaining our own staff of instructors and utilizing nationally recognized experts to train Alaskans.

Industrial Services

kakivik.com | info@kakivik.com

KeyBank 101 W. Benson Blvd., Suite 400 Anchorage, AK 99503

ACTIVITIES: Key provides deposit, lending, cash management and investment services to indi- Year Founded: 1825 viduals and small and mid-sized businesses in 12 states under the name KeyBank National As- Estab. in Alaska: 1985 sociation. Key also provides a broad range of sophisticated corporate and investment banking Employees & Revenue products, such as merger and acquisition advisory.

907-562-6100 Brian Nerland, Market President Finance, Insurance, Real Estate 124

Alaska: 116

COMMUNITY: We are pleased to support many quality Alaska programs: Alaska Business Develop- Worldwide: 14,783 ment Center; Alaska Native Heritage Center; Alaska Federation of Natives; Aleutian Pribilof Islands Global: $4.11B Association; Junior Achievement; Neighbors Make the Difference Day; Universities of Alaska. key.com

Alaska Business Monthly | April 2014

www.akbizmag.com

Kinross Fort Knox PO Box 73726 Fairbanks, AK 99707

ACTIVITIES: Fairbanks gold mining, gold producer.

907-490-2218

kinross.com | anna.atchison@kinross.com

Year Founded: 1995 Estab. in Alaska: 1995

COMMUNITY: Donations, volunteer time, and electric rate reduction.

Employees & Revenue Alaska: 630 Worldwide: 630

Eric Hill, General Manager Mining Koniag, Inc. 194 Alimaq Drive Kodiak, AK 99615

ACTIVITIES: Alaska Regional Native Corporation

Year Founded: 1972 Estab. in Alaska: 1972

907-486-2530

COMMUNITY: Koniag Education Foundation, Alutiiq Museum, Dig Afognak, Alaska Federation of Natives, Gulf of Alaska Communities Coalition, Alaska Native Arts Foundation and Employees & Revenue Alaska: 57 more. Worldwide: 615

Elizabeth Perry, Ph.D., CEO

koniag.com | facebook.com/KoniagInc

Alaska: $30.23M Global: $202.14M

Alaska Native Organization Linc Energy Ltd. 3000 C St., Suite #103 Anchorage, AK 99503 907-868-8660 Corri Feige, GM Alaska

ACTIVITIES: Oil and gas exploration and production, Underground Coal GasiďŹ cation (UCG), Year Founded: 1996 Estab. in Alaska: 2009 Gas to Liquids (GTL), Enhanced Oil Recovery (EOR). COMMUNITY: Grass root initiatives driven by employee volunteer work. lincenergy.com | linc@lincenergy.com

Employees & Revenue Alaska: 20 Worldwide: 200

Oil & Gas

Discover our Arctic Capabilities & Workforce Development Opportunities

ADVANCING

RESPONSIBLE

ARCTIC DEVELOPMENT

FOR GENERATIONS.

WE ARE UIC

www.akbizmag.com

April 2014 | Alaska Business Monthly

125

special section

Corporate 100—Top Citizens of Industry

Lounsbury & Associates 5300 A St. Anchorage, AK 99518

ACTIVITIES: Civil engineering, land surveying, planning, construction management. Servicing Year Founded: 1949 Estab. in Alaska: 1949 local and state government, the oil and gas industry, and more.

907-272-5451

COMMUNITY: Lounsbury supports a wide variety of local civic organizations, youth sports, Employees & Revenue Alaska: 85 and the University of Alaska Anchorage scholarships. Worldwide: 85

Jim Sawhill, President

lounsburyinc.com | k.ayers@lounsburyinc.com

Industrial Services

Lynden Inc. 6641 S. Airpark Pl. Anchorage, AK 99502 907-245-1544 Jim Jansen, Chairman

ACTIVITIES: Lynden is a family of transportation companies with capabilities including truckload & less- Year Founded: 1906 than-truckload service, scheduled & charter barges, rail barges, intermodal bulk chemical hauls, sched- Estab. in Alaska: 1954 uled & chartered air freighters, domestic & international air/ocean forwarding, and multi-modal logistics.

Employees & Revenue

COMMUNITY: Lynden gives back in the communities we serve. Lynden employees volunteer for Alaska: 851 charities and the companies contribute ﬁnancially and with in-kind services to a variety of worthy Worldwide: 2,649 causes. Lynden contribute to United Way, Habitat For Humanity, local food banks and many other Alaska: $875M charitable organizations.

Transportation

lynden.com | information@lynden.com

Matanuska Valley Federal Credit Union 1020 S. Bailey St. Palmer, AK 99645-6924

ACTIVITIES: Building better ﬁnancial futures for people who live, work or worship in the Mat- Year Founded: 1948 Su Borough or Chugiak/Eagle River area. MVFCU offers a full range of ﬁnancial services to all Estab. in Alaska: 1948 eligible members.

907-745-4891 Al Strawn, CEO

Employees & Revenue Alaska: 139

COMMUNITY: MVFCU participates in a wide variety of community activities and ﬁnancial Worldwide: 145 learning events. mvfcu.coop | facebook.com/mvfcu.coop

Alaska: $3.25M Global: $3.25M

Finance, Insurance, Real Estate

MTA Inc. 1740 S. Chugach St. Palmer, AK 99645 907-745-3211 Greg Berberich, CEO

ACTIVITIES: Alaskan owned, non-proﬁt cooperative delivering advanced communications Year Founded: 1953 products including wireless, high-deﬁnition digital television with video-on-demand & local Estab. in Alaska: 1953 community content, high-speed Internet, local & long-distance, online directory, IT business Employees & Revenue support, directory & television advertising. Alaska: 297

COMMUNITY: MTA has over 290 employees that donate their money and volunteer their time Worldwide: 297 to hundreds of non-proﬁt organizations throughout the Mat-Su and Eagle River communities. Alaska: $99M MTA alone donated to 160 charitable organizations, groups and events in 2013. Global: $99M

Telecommunications

mtasolutions.com | facebook.com/MatanuskaTelephone

NANA WorleyParsons PO Box 111100 Anchorage, AK 99511

ACTIVITIES: A project delivery company focused on multi-discipline engineering and design, Year Founded: 1997 procurement and construction management services for the Hydrocarbons, Power, Minerals Estab. in Alaska: 1997 & Metals, and Infrastructure & Environment industries.

907-273-3900 Rock Hengen, President/Gen. Mgr.

Employees & Revenue

COMMUNITY: Following the lead of our parent companies, NANA WorleyParsons believes in Alaska: 500 and practices good corporate citizenship. We actively support the Alaska community by spon- Worldwide: 500 soring and/or participating in activities and events that beneﬁt non-proﬁt organizations that are in line with our core values.

Industrial Services

nanaworleyparsons.com | info@nanaworleyparsons.com

Northern Air Cargo 3900 Old International Airport Rd. Anchorage, AK 99502

ACTIVITIES: Anchorage based Northern Air Cargo is Alaska’s largest all-cargo airline. From grocer- Year Founded: 1956 ies and generators to medical supplies and lumber, customers across Alaska, including a wide array Estab. in Alaska: 1956 of industries such as oil & gas, mining, construction, and commercial ﬁshing rely on NAC’s services.

907-243-3331 David Karp, President/CEO Transportation 126

Employees & Revenue

COMMUNITY: Northern Air Cargo actively supports the Alaska’s communities in which we Alaska: 340 live and work through direct employee engagement and volunteerism and by investing in the Worldwide: 350 future of Alaska through charitable giving of money and resources to many important causes and non-proﬁt organizations. nac.aero | customercare@nac.aero

Alaska Business Monthly | April 2014

www.akbizmag.com

Northrim Bank PO Box 241489 Anchorage, AK 99524 907-562-0062 Joseph Beedle, President and CEO

ACTIVITIES: Northrim Bank is a commercial bank, headquartered in Anchorage, Alaska, com- Year Founded: 1990 mitted to providing Customer First Service. We specialize in serving businesses, professionals, Estab. in Alaska: 1990 and individual Alaskans.

Employees & Revenue

COMMUNITY: We are deeply committed to the communities where we do business. Each Alaska: 261 year, Northrim Bank contributes over $500,000 to organizations that support community and Worldwide: 270 economic development, programs to strengthen low income families and higher education throughout Alaska.

Finance, Insurance, Real Estate

northrim.com | marketing@nrim.com

Offshore Systems Inc. (Anchorage) 2410 E. 88th Ave. Anchorage , AK 99507

ACTIVITIES: Dock facilities in Niksiki, Dutch Harbor, and Adak servicing the oil and ﬁshing in- Year Founded: 1983 dustries. Services include dock space, warehousing, cold storage, stevedoring services, heavy Estab. in Alaska: 1983 equipment, and fuel.

800-733-6434

COMMUNITY: Local community involvement includes support of non-proﬁt and public ser- Worldwide: 175 vice efforts.

Jared Davis, Dir. AK Ops Industrial Services Olgoonik Corporation 3201 C St., Suite 700 Anchorage, AK 99503 907-562-8728 Hugh Patkotak, Sr., Chairman & CEO Alaska Native Organization

www.akbizmag.com

Employees & Revenue Alaska: 150

offshoresystemsinc.com

ACTIVITIES: Worldwide Government Contracting and Commercial Services: Construction; Year Founded: 1973 Oilﬁeld Support; Logistics; Facility Operations and Maintenance; Professional Administrative Estab. in Alaska: 1973 Support; Aerospace; Environmental Remediation and Security

Employees & Revenue

COMMUNITY: We actively support our AK community, promote education and provide share- Alaska: 127 holder jobs, training and scholarships. Several employees also serve on nonproﬁt boards. Re- Worldwide: 870 cently, we constructed Wainwright’s ﬁrst modern playground, augmenting the City project by Alaska: $64.00M donating labor, material and other costs olgoonik.com | info@olgoonik.com

Global: $214.00M

April 2014 | Alaska Business Monthly

127

special section

Corporate 100—Top Citizens of Industry

Osborne Construction Co. 3701 Braddock St Fairbanks, AK 99701 907-451-0079 George Osborne Jr., President Construction

ACTIVITIES: General contractor focusing on commercial, industrial or residential buildings, Year Founded: 1987 Estab. in Alaska: 1988 design-build, civil, site development, utilities and engineering work. COMMUNITY: ABC, AGC, youth hockey programs in Anchorage, Boys & Girls Club of Tanana Employees & Revenue Alaska: 109 Valley, Have a Heart Auction-Fairbanks, AK Peace Ofﬁcers, American Heart Association and Worldwide: 125 others. osborne.cc | occ@osborne.cc

Paciﬁc Alaska Freightways Inc. 431 E. 104th Ave. Anchorage, AK 99515

ACTIVITIES: Consolidating. On time delivery service. Freight forwarding.

907-336-2567

pafak.com | Info@pafak.com

COMMUNITY: ABC Members, AGC Members, Alaska Trucking Association, Special Olympics.

Ed Fitzgerald, CEO

Alaska: $42M Global: $42M

Year Founded: 1961 Estab. in Alaska: 1961 Employees & Revenue Alaska: 65 Worldwide: 110 Alaska: $50M

Transportation

Price Gregory International 301 W. Northern Lights Blvd., Suite 300 Anchorage, AK 99503

ACTIVITIES: Pipeline, power, heavy industrial construction, EPC and consulting services. In- Year Founded: 1974 Estab. in Alaska: 1974 frastructure construction services provider.

907-278-4400

pricegregory.com | dmatthews@pricegregory.com

COMMUNITY: RDC, Alliance, AVTEC, FPTCT, various others.

Alaska: $50.00M Global: $900.00M

Construction

Princess Alaska Lodges Mile 238.5 George Parks Hwy. Denali National Park, AK 99755 800-426-0500 Charlie Ball, President

Employees & Revenue Alaska: 300 Worldwide: 2,500

ACTIVITIES: Princess welcomes the independent traveler with unmatched comfort in the Year Founded: 1972 midst of the grand Alaska wilderness. Awaken your sense of wonder and adventure by booking Estab. in Alaska: 1972 one of ﬁve luxurious Princess Lodges or a Rail Tour from Anchorage or Fairbanks to renowned Employees & Revenue Denali National Park. Alaska: 1,172

COMMUNITY: At Princess Lodges, social responsibility is at the core of how we do business. Worldwide: 1,488 We have a history of being a contributor to Alaska, supporting more than 180 charitable and civic organizations throughout the 49th state.

Travel & Tourism

facebook.com/princesslodges | aklodges@princesstours.com

Providence Health & Services Alaska 3760 Piper St., Suite 2021 Anchorage, AK 99508

ACTIVITIES: Healthcare, serves Alaskans in eight communities: Anchorage, Cordova, Eagle Year Founded: 1902 River, Matanuska-Susitna Valley, Kodiak Island, Seward, Soldotna, and Valdez. State’s largest Estab. in Alaska: 1902 private employer. PH&SA includes Providence Alaska Medical Center.

907-212-3145

COMMUNITY: The Providence Alaska Foundation works to build a broad and deep base of philanthropy to support the Mission of Providence Health & Services in Alaska.

Bruce Lamoureux, Chief Exec. Healthcare

Employees & Revenue Alaska: 4,229

alaska.providence.org | info.phsa@providence.org

Pruhs Construction 2193 Viking Dr. Anchorage, AK 99501

ACTIVITIES: Heavy civil contractor, roads, airports, site work, underground utilities, industrial. Year Founded: 1958

907-279-1020

pruhscorp.com | dana@pruhscorp.com

Estab. in Alaska: 1958

COMMUNITY: Support statewide and local charitable organizations.

Dana Pruhs, CEO Construction 128

Alaska Business Monthly | April 2014

Employees & Revenue Alaska: 150 Worldwide: 150 Alaska: $41.50M Global: $41.50M

www.akbizmag.com

Ravn Alaska 4700 Old Int’l Airport Rd. Anchorage, AK 99502

ACTIVITIES: Transportation; Scheduled passenger service, scheduled cargo and charter ser- Year Founded: 1948 Estab. in Alaska: 1948 vice

907-266-8394

COMMUNITY: American Cancer Association, American Red Cross, Boys & Girls Clubs, Big Employees & Revenue Alaska: 950 Brother Big Sister just to mention a few Worldwide: 950

Bob Hajdukovich, CEO

ﬂyera.com | PR@ﬂyera.com

Alaska: $160M Global: $160M

Roger Hickel Contracting Inc. 11001 Calaska Cir. Anchorage, AK 99515

ACTIVITIES: General contractor; commercial and road work.

Year Founded: 1995 Estab. in Alaska: 1995

907-279-1400

rogerhickelcontracting.com | contact@rhcak.com

Transportation

COMMUNITY: YMCA and Operation Opening Doors.

Employees & Revenue Alaska: 45 Worldwide: 45

Mike Shaw, President

Alaska: $60.00M

Construction Shell Exploration & Production Co. 3601 C St., Suite 1000 Anchorage, AK 99503

ACTIVITIES: Arctic Offshore oil and gas exploration

907-770-3700

shell.com.us/alaska | Alaska@shell.com

Year Founded: 1952 Estab. in Alaska: 2005

COMMUNITY: Numerous educational and social contributions statewide.

Employees & Revenue Alaska: 185 Worldwide: 87,000

Pete Slaiby, VP Alaska Oil & Gas

Building Alaska Since 1983 Dedicated to respecting the people, the land, and the communities where we build.

Phone 907.561.1840

www.akbizmag.com

www.denaligc.com

P.O. Box 111490 Anchorage , Alaska 99511

April 2014 | Alaska Business Monthly

129

special section

Corporate 100—Top Citizens of Industry

SMG of Alaska, Inc. 1600 Gambell St. Anchorage, AK 99501

ACTIVITIES: Hosted 150 event days in 2013.

907-279-0618

sullivanarena.com | pontt@sullivanarena.com

COMMUNITY: Over 300,000 Visitors in 2013.

Joe Wooden, Regional GM

Year Founded: 1977 Estab. in Alaska: 1999 Employees & Revenue Alaska: 681 Worldwide: 200,000 Alaska: $12.37M

Travel & Tourism

Southeast Alaska Regional Health Consortium 3245 Hospital Dr. Juneau, AK 99801 907-463-4000 Charles Clement, President/CEO

ACTIVITIES: We provide the highest quality health services in partnership with Native people Year Founded: 1975 to improve their health, prevention and awareness to the highest possible level. We serve 18 Estab. in Alaska: 1975 communities throughout the S.E. Alaska archipelago. COMMUNITY: SEARHC created The Healing Hand Foundation to bridge the ﬁnancial gap between SEARHC’s resources and the unmet medical needs of Alaska Natives. searhc.org | facebook.com/SouthEastAlaskaRegionalHealthConsortium

Employees & Revenue Alaska: 1,000 Worldwide: 1,000 Alaska: $113M Global: $113M

Healthcare

Spenard Builders Supply Inc. 300 E. 54th Ave., Suite 201 Anchorage, AK 99518 907-261-9105 Ed Waite, Senior VP Retail & Wholesale Trade

Teck Alaska-Red Dog Mine 3105 Lakeshore Dr., Bldg. A, Suite 101 Anchorage, AK 99517 907-754-5116 Henri Letient, Gen. Mgr.

ACTIVITIES: Provides a full line of building materials and home-improvement products to ﬁll Year Founded: 1952 Estab. in Alaska: 1952 the needs of residential and commercial contractors. COMMUNITY: Spenard Builders Supply community efforts are with Habitat for Human- Employees & Revenue Alaska: 700 ity, March of Dimes, Iditarod, Yukon Quest, Alaska State Fair and various local organizations Worldwide: 10,000 throughout the state. sbsalaska.com

ACTIVITIES: In operation since 1989, Red Dog is a zinc-lead mine located in Northwest Alaska, Year Founded: 1989 Estab. in Alaska: 1980 near Kotzebue, and one of the world’s largest producers of zinc concentrate. COMMUNITY: Red Dog Operations upholds the highest environmental standards and is com- Employees & Revenue Alaska: 550 mitted to the communities where it operates, while providing Alaskans and Alaska’s Native Worldwide: 14,000 people with economic beneﬁts and opportunities. reddogalaska.com | reddog.info@teck.com

Mining

Tesoro Alaska Co. 1601 Tidewater Anchorage, AK 99501 907-261-7221 James Tangaro, VP

ACTIVITIES: Located on the Cook Inlet, 60 miles southwest of Anchorage, the 72,000 (bpd) Year Founded: 1969 Kenai Reﬁnery has been producing gasoline and gasoline blendstocks, jet fuel, diesel fuel, heat- Estab. in Alaska: 1969 ing oil and heavy fuel oils, propane and asphalt since 1969.

Employees & Revenue

COMMUNITY: Tesoro actively supports a wide range of local events and programs – from em- Alaska: 550 ployee fundraising for the United Way to youth sports programs. Tesoro is the founding spon- Worldwide: 7,000 sor of Alaska Business Week, and the signature sponsor of the annual Caring for the Kenai environmental contest.

Oil & Gas

tsocorp.com

The Odom Corporation 240 West First Avenue Anchorage, AK 99501

ACTIVITIES: Licensed Wholesale Alcoholic Beverage Distributor. Franchised Soft Drink Dis- Year Founded: 1934 Estab. in Alaska: 1934 tributor.

John Odom, President & CEO

COMMUNITY: The Odom Corporation contributes to many local organizations. Some of the organizations include: ALPAR; American Cancer Society; AK Zoo; AK Aviation Museum; American Heart Assoc; AK School Activities Assoc; AK Civil Air Patrol; Boys & Girls Club; Beans Cafe; Junior Achievement; Iditarod; Fur Rondy

Retail & Wholesale Trade

odomcorp.com

907-272-8511

130

Alaska Business Monthly | April 2014

Employees & Revenue Alaska: 410 Worldwide: 1,053 Alaska: $143M Global: $366M

www.akbizmag.com

The Tatitlek Corporation 561 E. 36th Ave. Anchorage, AK 99503 907-278-4000 Roy Totemoff, President/CEO

ACTIVITIES: Live and Virtual Training Scenarios, Information Technology Services, Satellite-Based Year Founded: 1973 Imagery Capture and Processing, Base Operations Services, Special Operations and Intelligence and Estab. in Alaska: 1973 Vulnerability/Security Assessments, Aviation Support Services, Supply Chain Management, and GenEmployees & Revenue eral Contracting. Alaska: 75

COMMUNITY: The Tatitlek Corporation’s community involvement includes hosting a culture preservation Worldwide: 937 camp, participating in events like the Alaska Run for Women, hosting an annual United Way Campaign, Alaska: $13.40M participating in local fundraising events, and is an active Anchorage Chamber of Commerce Member.

Alaska Native Organization

tatitlek.com | info@tatitlek.com

Three Bears Alaska Inc. 445 N. Pittman Rd., Suite B Wasilla, AK 99623

ACTIVITIES: Retail sales.

907-357-4311 David Weisz, President/CEO

Year Founded: 1980 Estab. in Alaska: 1980

COMMUNITY: Involved in all local communities surrounding our stores and ofﬁces, with a parEmployees & Revenue ticular focus on supporting schools and children. threebearsalaska.com | steve@threebearsalaska.com

Alaska: 310 Worldwide: 358

Alaska: $116.45M Global: $130.26M

Retail & Wholesale Trade Totem Ocean Trailer Express 2511 Tidewater Rd. Anchorage, AK 99501-1044

Global: $124.40M

ACTIVITIES: Totem Ocean’s Roll-on/Roll-off (Ro/Ro) cargo ship operation provides fast, on- Year Founded: 1975 Estab. in Alaska: 1975 time service between the Port of Tacoma, Washington and the Port of Anchorage, Alaska.

Grace Greene, Alaska Gen. Mgr.

COMMUNITY: Totem Ocean is dedicated to serving Alaska’s transportation needs and sup- Employees & Revenue Alaska: 35 porting those communities we serve. This dedication has fostered a special relation. Totem Worldwide: 140 Ocean is dedicated to serving Alaska’s transportation needs and supporting those communities we serve.

Transportation

totemocean.com

907-276-5868

www.akbizmag.com

April 2014 | Alaska Business Monthly

131

special section

Corporate 100—Top Citizens of Industry

Udelhoven Oilﬁeld System Service 184 E. 53rd Ave. Anchorage, AK 99518-1222

ACTIVITIES: Oilﬁeld Services, Construction Management, Electrical & Mechanical Construc- Year Founded: 1970 Estab. in Alaska: 1970 tion

907-344-1577

COMMUNITY: Active in many community activities, United Way, Red Cross, Salvation Army, Employees & Revenue Alaska: 679 Wounded Warriors. Worldwide: 780

Jim Udelhoven, CEO

udelhoven.com | rfrontdesk@udelhoven.com

Industrial Services

Ukpeagvik Inupiat Corporation (UIC) PO Box 890 Barrow, AK 99723 907-852-4460 Anthony Edwardsen, President/CEO

Alaska: $146.41M Global: $168.34M

ACTIVITIES: UIC provides services to clients in a variety of industries, including operations in Year Founded: 1973 Barrow, construction, architecture and engineering, regulatory consulting, information tech- Estab. in Alaska: 1973 nology, marine operations, logistics, and maintenance and manufacturing.

Employees & Revenue

COMMUNITY: UIC has a strong tradition of supporting community needs throughout our ser- Alaska: 588 vice areas. Speciﬁcally, we encourage programs that support our shareholders such as youth Worldwide: 3,340 participation, community spirit, cooperation, education and programs that preserve and proAlaska: $99.30M mote the Iñupiaq culture.

Global: $317.72M

Alaska Native Organization

uicalaska.com | info@uicalaska.com

Unisea 88 Salmon Way Unalaska, AK 99692

ACTIVITIES: Unisea’s largest Alaska operations are the state of the art processing facilities in Year Founded: 1974 Dutch Harbor. Unisea processes surimi and ﬁllets from pollock, and processes crab, cod, and Estab. in Alaska: 1975 halibut.

907-581-1258

COMMUNITY: Unisea provides seafood to SeaShare to feed the hungry and raises funds for Worldwide: 1,383 United Way, Ronald McDonald House, the Red Cross, Salvation Army, and the YMCA.

Terry Shaff, President

Employees & Revenue Alaska: 1,310

unisea.com

Seafood

Global: $230.00M

URS 700 G St., Suite 500 Anchorage, AK 99501

ACTIVITIES: URS Alaska is a team of over 175 engineers, scientists, planners, and support staff located Year Founded: 1904 primarily in ofﬁces in Anchorage and Fairbanks. URS provides “arctic-smart” engineering & environmen- Estab. in Alaska: 1948 tal services for the complete project life-cycle from permitting & design through production & closure.

907-562-3366 Joe Hegna, Alaska Operation Manager, Vice President

COMMUNITY: URS Alaska places great value on community involvement, holding food and cloth- Alaska: 175 ing drives, silent auctions to raise funds for charities, and collecting items for families and organiza- Worldwide: 50,000 tions in need during the holidays. Each year URS participates in a “Day of Service” organized to give back to a select organization.

Industrial Services

urscorp.com/

Usibelli Coal Mine Inc. PO Box 1000 Healy, AK 99743

ACTIVITIES: Coal Mine and afﬁliate companies.

Employees & Revenue

Year Founded: 1943 Estab. in Alaska: 1943

907-452-2625

COMMUNITY: UAF, United Way, Denali Borough School District, ELC Daycare, Kids in Motion, Tri-Valley Library, Healy Hockey, Tri-Valley Volunteer Fire Department, Friends of the Sutton Employees & Revenue Alaska: 175 Library, Alaska Sea Life Center and many more. “Making a Difference in our Communities” Worldwide: 210

Joseph E. Usibelli Jr., President

usibelli.com | info@usibelli.com

Mining

USKH Inc. 2515 A St. Anchorage, AK 99503 907-276-4245 Timothy Vig, President/Principal Industrial Services 132

ACTIVITIES: USKH is a full-service, multidiscipline architectural and engineering ﬁrm with ofﬁces Year Founded: 1972 in eight locations. Services include: architecture; civil, structural, transportation, mechanical & elec- Estab. in Alaska: 1972 trical engineering; surveying & GIS; landscape architecture; planning; & environmental services.

Employees & Revenue

COMMUNITY: USKH is thoroughly invested in our communities, providing support for more Alaska: 95 than 70 non-proﬁt organizations, including the United Way, American Heart Association, Worldwide: 131 Bean’s Café, & the Children’s Lunchbox. We support AEDC’s Live. Work. Play. community inAlaska: $23M volvement campaign & host Bike to Work events uskh.com | marketing@uskh.com

Alaska Business Monthly | April 2014

Global: $26M

www.akbizmag.com

Vigor Alaska 3801 Tongass Ave. Ketchikan, AK 99901 907-228-5302 Adam Beck, President

ACTIVITIES: We are the largest most capable marine industrial service company in the AK/ Year Founded: 1994 PNW Region focused on shipbuilding and repair. Alaska operations are concentrated in AID- Estab. in Alaska: 1994 EA’s Ketchikan Shipyard. Our mobile and multi-skilled workforce travels throughout Alaska to Employees & Revenue heavy industrial and offshore projects. Alaska: 161

COMMUNITY: We build healthy communities and life-long careers in Alaska’s booming ma- Worldwide: 2,000 rine industrial and marine technology sectors. Our diverse workforce is engaged in social and civic activities that build strong communities and secure futures... at school, at work, at home. Alaska: $27.15M

Global: $500.00M

Industrial Services

akship.com | info@akship.com

W.W. Grainger 6240 B St. Anchorage, AK 99518

ACTIVITIES: North America’s leading broad-line supplier of maintenance, repair and operating Year Founded: 1927 Estab. in Alaska: 1989 (MRO) products, with an expanding global presence within 22 countries.

907-562-5400 David LaBarre, AK Market Mgr. Industrial Services

Watterson Construction Co. 6500 Interstate Cir. Anchorage, AK 99518 907-563-7441 Bill Watterson, President

COMMUNITY: Grainger contributed $10,000 in product to Steam Engine 557 Restoration, Employees & Revenue Alaska: 55 $200,000 in product to ACTEV Institute of Technology, $10,000 to the Alaska Red Cross and Worldwide: 22,000 $10,000 to the Food Bank of Alaska.

ACTIVITIES: Construction.

Year Founded: 1981 Estab. in Alaska: 1981

COMMUNITY: ABC - Alaska Chapter; Special Olympics; Habitat; March of Dimes; UAA CM Employees & Revenue program; Society of Military Engineers. wattersonconstruction.com | info@wattersonsconstruction.com

Alaska: 100 Worldwide: 101 Alaska: $90M Global: $90M

Construction

Weaver Brothers Inc. 2230 Spar Ave. Anchorage, AK 99501

Alaska: $49M Global: $9.40B

grainger.com | david.labarre@grainger.com

ACTIVITIES: Trucking, local drayage, linehaul, dry bulk, liquid bulk, fuel, chemical, hot oil, heavy Year Founded: 1962 Estab. in Alaska: 1947 haul, hazmat and specialty transport as well as Oil Field support.

907-278-4526

COMMUNITY: Member Resource Development Council, Associated General Contractors, Oil Employees & Revenue Alaska: 155 Industry Alliance, ALPAR and numerous other organizations. Worldwide: 155

Jim Doyle, President

wbialaska.com | info@wbialaska.com

Transportation

Wells Fargo Bank N.A. 301 W. Northern Lights Blvd. Anchorage, AK 99503 907-265-2730 Joe Everhart, AK Region President

ACTIVITIES: Diversiﬁed ﬁnancial services company, providing businesses of all sizes with Year Founded: 1852 checking and savings products, insurance, retirement planning, payroll services, merchant ser- Estab. in Alaska: 1916 vices, loans, credit cards and online tips and tools for building a successful business at wellsfarEmployees & Revenue gobusinessinsights.com. Alaska: 900

COMMUNITY: Wells Fargo invests $1.5 million annually in more than 300 nonproﬁts and Worldwide: 270,000 schools in Alaska. Each year we sponsor a community support campaign to raise more funds Global: $84,000B for our communities. In 2013, our team members donated a record $404,000.

Finance, Insurance, Real Estate

wellsfargo.com/biz | twitter.com/DavidJKennedyWF

Westmark Hotels 720 West 5th Avenue Anchorage, AK 99501

ACTIVITIES: Westmark Hotels, a Holland America Line Company, is Alaska and the Yukon’s Year Founded: 1987 largest hotel group. A collection of 8 hotels and inns throughout Alaska and the Yukon each Estab. in Alaska: 1987 reﬂecting the personality of the community it calls home. Quality lodging and dining and warm Employees & Revenue northern hospitality.

800-544-0970 Charlie Ball, President Travel & Tourism www.akbizmag.com

Alaska: 778

COMMUNITY: At Westmark Hotels, social responsibility is at the core of how we do business. Worldwide: 1,094 We have a history of being a contributor to Alaska, supporting more than 180 charitable and civic organizations throughout the 49th state. westmarkhotels.com/ | info@westmarkhotels.com April 2014 | Alaska Business Monthly

133

Corporate 100

special section

2014 Corporate 100 by Business Category and Total Employment Figures

Alaska Native Organization Corporate 100 Company

Alaska Employees

Global Employees* *Includes Alaska

Denali Alaskan Federal Credit Union

323

First National Bank Alaska

694

KeyBank

116

14,783

Matanuska Valley Federal Credit Union

139

145

Northrim Bank

261

270

Wells Fargo Bank N.A.

900

270,000

4,210

343,393

Finance, Insurance, Real Estate Total

Afognak Native Corp./Alutiiq

189

4,600

Ahtna, Inc.

308

1,668

Aleut Corporation

185

623

Arctic Slope Regional Corporation

4,175

10,082

Corporate 100 Company

Bering Straits Native Corporation

384

1,166

Alaska Regional Hospital

850

1,338

4,480

Central Peninsula Hospital

772

Calista Corporation

400

1,600

Fairbanks Memorial Hospital

1,200

Chenega Corporation

440

5,360

Geneva Woods

186

198

Chugach Alaska Corporation

500

4,300

Providence Health & Services Alaska

4,229

Southeast Alaska Regional Health Consortium

1,000

Healthcare Total

8,237

8,249

Bristol Bay Native Corporation

Doyon, Limited

1,704

2,988

Koniag, Inc.

615

Olgoonik Corporation

127

870

The Tatitlek Corporation

937

Ukpeagvik Inupiat Corporation (UIC)

588

3,340

Healthcare Alaska Employees

Global Employees* *Includes Alaska

Industrial Services

Alaska Native Organization Total

10,470

42,629

Construction Corporate 100 Company

Corporate 100 Company CCI Industrial Services, LLC

Alaska Employees

Global Employees* *Includes Alaska

Alaska Employees

Global Employees* *Includes Alaska

250

CH2M HILL

2,456

26,175

Colville Inc.

200

Construction Machinery Industrial

105

Cruz Construction

192

361

Fairweather LLC

140

Davis Constructors & Engineers, Inc.

100

Granite Construction Company

4,000

Great Northwest Inc.

250

Jacobs

70,000

Osborne Construction Co.

109

125

Kakivik Asset Management, LLC

200

Pruhs Construction

150

Lounsbury & Associates

Price Gregory International

300

2,500

NANA WorleyParsons

500

Roger Hickel Contracting Inc.

Offshore Systems Inc. (Anchorage)

150

175

Watterson Construction Co.

100

Udelhoven OilďŹ eld System Service

679

780

1,114

7,271

URS

175

50,000

Construction Total

Finance, Insurance, Real Estate Corporate 100 Company Alaska USA Federal Credit Union

Alaska Employees

Global Employees* *Includes Alaska

1,349

1,915

BDO USA, LLP

101

54,933

Credit Union 1

327

330

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Alaska Business Monthly | April 2014

USKH Inc.

131

Vigor Alaska

161

2,000

W.W. Grainger Industrial Services Total

22,000

5,513

173,102

www.akbizmag.com

Manufacturing Corporate 100 Company

Alaska Employees

Telecommunications Global Employees* *Includes Alaska

Corporate 100 Company

Alaska Employees

Global Employees* *Includes Alaska

Franz Bakery

100

4,000

Alaska Communications

832

855

Manufacturing Total

100

4,000

AT&T

531

243,360

1,900

GCI

Mining Corporate 100 Company

MTA Inc. Alaska Employees

Global Employees* *Includes Alaska

Coeur Alaska Inc.

306

1,900

Kinross Fort Knox

630

Teck Alaska-Red Dog Mine

550

Usibelli Coal Mine Inc. Mining Total

Transportation

14,000

175

210

Alaska Airlines

1,661

16,740

Global Employees* *Includes Alaska

Alyeska Pipeline Service Co.

800

BP Exploration (Alaska) Inc.

2,300

85,900

ConocoPhillips Alaska, Inc.

1,200

18,400

Linc Energy Ltd.

200

Shell Exploration & Production Co.

185

87,000

Tesoro Alaska Co.

550

7,000

5,055

199,300

Retail & Wholesale Trade Corporate 100 Company

297 246,412

Alaska Employees

Oil & Gas Total

297 3,560

Corporate 100 Company

Oil & Gas Corporate 100 Company

Telecommunications Total

Alaska Employees

*Includes Alaska

1,700

12,750

American Fast Freight, Inc.

150

Carlile Transportation Systems

550

725

Crowley Solutions

500

5,400

Delta Western Inc.

100

120

Era Helicopters LLC

130

1,000

FedEx Express

553

160,000

Foss Maritime Company

1,500

Horizon Lines LLC

260

1,800

Lynden Inc.

851

2,649

Northern Air Cargo

340

350

PaciďŹ c Alaska Freightways Inc.

110

Ravn Alaska

950

Totem Ocean Trailer Express

140

Weaver Brothers Inc.

155

Transportation Total

6,363

187,799

Global Employees*

Travel & Tourism

*Includes Alaska

1,500

Global Employees*

Alaska Commercial Co.

900

Alaska Industrial Hardware Inc.

200

Spenard Builders Supply Inc.

700

10,000

Gray Line of Alaska

522

838

The Odom Corporation

410

1,053

Holland America Line

778

1,094

Three Bears Alaska Inc.

310

358

1,172

1,488

Carrs Safeway

2,915

160,000

SMG of Alaska, Inc.

681

200,000

Retail & Wholesale Trade Total

5,435

173,111

Westmark Hotels

778

1,094

Corporate 100 Company

Alaska Employees

Princess Alaska Lodges

Alyeska Resort

Seafood Corporate 100 Company American Seafoods Group LLC

Travel & Tourism Total

Alaska Employees

Global Employees* 1,304

Unisea

1,310

1,383

Seafood Total

1,359

2,687

www.akbizmag.com

*Includes Alaska

700

4,631

205,214

Utility

*Includes Alaska

Global Employees*

Corporate 100 Company

Alaska Employees

Global Employees* *Includes Alaska

Alaska Village Electric Cooperative Inc.

ENSTAR Natural Gas Co.

195

Homer Electric Association Inc.

158

Utility Total

425

April 2014 | Alaska Business Monthly

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special section

Corporate 100—Corporate Spotlight

Geneva Woods Focusing on patient-centered care By Rindi White

P Photo courtesy of Al Kiefer | Geneva Woods

atient-centered care—that’s the focus at Geneva Woods Pharmacy, and it’s a focus that is leading the company into a new era of growth and expansion. “The way we’ve approached this business is so different,” says president Dan Afrasiabi. While some pharmacies don’t deliver, and others deliver only within a few miles of their physical location, Geneva Woods delivers, as Afrasiabi says, “to that last mile.” In Alaska, where the company was founded, and in central Montana, where the company recently expanded, delivering medication, medical equipment, and services to people’s homes or small assisted living facilities is important. It might mean the difference between someone staying at home or in his or her community and having to move to a larger hub for medical treatment. “As people have decided to retire and live their later years in the areas they have always lived, the care required [to stay] in those areas wasn’t always available. In more remote

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www.akbizmag.com

markets, the population size generally could not support the level of sophisticated care required for such people,” Afrasiabi says. But because Geneva Woods provides an integrated model of care—everything from medical supplies such as walkers or a special hospital bed to medication in medsets (individually sealed dosage blister packs) and even treatment such as home infusions—the company is able to survive, and thrive, in smaller communities. In talking about providing care to people in more rural areas, Afrasiabi spoke about the company’s recent move to Helena, Montana. But that, he says, applies to rural Alaska, too—many communities have limited access to the types of pharmaceutical service found in larger communities like Anchorage, and that’s something he hopes his company can change. The company added about twenty new employees last year in its Montana expansion efforts, but it added another thirty to expand and improve service within Alaska as well.

Facing page: Compounding chemotherapy, from left: Hannah Delaney and Saharai Thompson. Left: Three women of the infusion lab, from left: Saharai Thompson, Hannah Delaney, and Vanessa Valadez. Photo courtesy of Al Kiefer | Geneva Woods

ACHIEVE MORE

Founded on Patient-Centered Care Founded in 1977 in an Anchorage subdivision of the same name, Geneva Woods Pharmacy aimed to provide quality pharmaceutical services to rural Alaskans. Over the years the company’s focus has gone beyond bottling pills. “We specialize in meeting a wide range of home healthcare needs, whether delivered at home or in assisted-living facilities and whether they are self-administered or provided by professionals, including our own. We provide comprehensive services for pharmacy [long-term care compliance packaging, compounding, infusion, and retail], medical equipment, specialty rehab, home infusion, respiratory, and other services that ensure convenience, professionalism, and efficiency,” company officials state on the Geneva Woods website. In that time, the company has grown from one pharmacy to many throughout Southcentral Alaska, with shipping arrangements to many more Alaska communities. Afrasiabi says the growth is related, in part, to a few key decisions made at the state level. State officials made a www.akbizmag.com

April 2014 | Alaska Business Monthly

137

“For me, coming to this business, I have recognized that it’s highly complex, but the core values I focus on are improving the quality and engagement of our teams, as well as driving their accountability, cooperation, and empowerment, all the while placing a huge focus on client services. We have to be able to surprise and delight our clients with our service level. Those are really universal ideas around how to build a great company.” —Dan Afrasiabi President, Geneva Woods Pharmacy

Photo courtesy of Al Kiefer | Geneva Woods

Saharai Thompson compounding chemotherapy.

commitment several years ago to keep seniors in Alaska as they retire instead of watching them leave the state for more senior-friendly climates. “One of the things that came out [of that decision] was strengthening the resources available to the elder population. And one of the key things was assisted living facilities that were done in a different way,” Afrasiabi says. Instead of large assisted living facilities in a campus-like setting as other states have, state officials promoted construction of smaller facilities integrated into neighborhoods. The model was developed in Oregon and Washington and involved two- to five-bed facilities. But the model wouldn’t work if nurses had to be on shift around the clock to administer medications—it would make the facility’s operating costs too high. That’s where pharmacies like Geneva Woods come in, Afrasiabi says. A caretaker can provide service at the assisted living facility and rely on Geneva Woods to deliver individual dosages of medication for each client, as well as infusions or respiratory treatments if needed. “Our residents utilize their services for incontinence supplies [and] durable medical equipment, and they are one of 138

Alaska Business Monthly | April 2014

the few companies [in Alaska] that provide the medsets,” says Theresa Brisky, registered nurse and administrator of Marlow Manor in Anchorage. “We do not allow our staff to work out of bottles—they [the medication] have to be in some form of unit-dosed packaging. It’s safety for the residents, safety for the staff,” Brisky says. If medication is administered out of five or six prescription bottles for each patient, the possibility of mistakes is higher, Brisky says. And even with the best record-keeping system, accountability can be an issue. But the medsets, which are now filled by two large robots in Geneva Woods’ company headquarters in Anchorage, provide a key tool to keep small assisted living facilities in compliance with licensing requirements. Amy Oney, administrator of Mama’s Assisted Living, a company that operates four assisted living homes and serves twenty residents, mostly in the Campbell Lake/West Dimond area of Anchorage, says she has been continually impressed by Geneva Woods’s flexibility. “I don’t get a ‘no we can’t’ but ‘how can we make it happen,’” Oney says. Dealing with patients’ prescription changes can be difficult, for example. “The hospital always seems to discharge people on Friday night at 5 p.m. —at everyone else’s worst time. But Geneva Woods always helps me; some kind of arrangement [for medication changes or medical equipment] will be made,” she says. Afrasiabi says the company recently invested in highly-sophisticated robotics so it could free up pharmacists for other duties. “It has allowed us to take our skilled positions and push them out toward our patients and quality control,” he

says. “We didn’t do that to reduce our headcount, we did it so we can increase patient care.”

More Than a Buzzword Patient care. It’s repeated everywhere on Geneva Woods’ website, and in talking to Afrasiabi one can tell it’s an issue he’s passionate about. He’s committed to making sure it’s the top company priority, a part of the Geneva Woods culture. But how? It’s one thing to list a company’s most important product as “care”—which he did in an internal presentation about the Geneva Woods culture and values. But the way his company gets there, Afrasiabi says, is by hiring people who care. Even if that means they need training for the field they’re working in. Take their Go Techs—those are the drivers who deliver medications and medical equipment. Afrasiabi says one of the first things he did when he refocused the company was to say driving experience was not a priority in hiring. “We’re not hiring drivers, we’re hiring people who care. We literally don’t care if the person has professional driving experience. What we dig for is whether this is a person who has the core underlying belief around the desire to care for people,” he says. Afrasiabi is relatively new to the pharmacy management field. He joined the company last year after having been an unofficial advisor to the Geneva Woods owner (and his good friend) Tom Gimple. Afrasiabi has a more traditional business background, mostly in tech services or outsourcing services, he says. He and Gimple worked together at Tickets. com, which worked to consolidate the ticketing industry and, in 2005, was www.akbizmag.com

sold to Major League Baseball Advanced Media, LP. Pharmacy services is a completely different business, but it’s one Afrasiabi has some knowledge of. His father, brother, and paternal uncles were or are physicians, he says, so he grew up around healthcare. “For me, coming to this business, I have recognized that it’s highly complex, but the core values I focus on are improving the quality and engagement of our teams, as well as driving their accountability, cooperation, and empowerment, all the while placing a huge focus on client services. We have to be able to surprise and delight our clients with our service level,” he says. “Those are really universal ideas around how to build a great company… if you get too caught up in the details and mechanics of the pharmaceutical industry, you overlook what you’re there for, and that’s to provide better care.”

Good for Today, Good for the Future Afrasiabi says in the coming year Geneva Woods will grow in the Soldotna area to better serve the Kenai Peninsula. Across the board, he says, the company is focused on improving everywhere the Geneva Woods team makes contact with clients to provide better clinical care. It’s the company’s motto, sure, but Afrasiabi says it’s also where healthcare is headed. “The large picture of the Affordable Care Act is to ensure that people can stay healthy at home. What drives cost is people having to leave their homes and be admitted or readmitted to the hospital,” he says. In the future, he says, payers will give bonuses to service providers whose care results in less hospitalization. Companies whose services don’t reduce hospitalization will be penalized. “That reimbursement mechanism is coming. It’s built into the Affordable Care Act and the goals of the Affordable Care Act. So we’re just getting ahead of that curve. We know that five years from now, it will mean higher revenues for us… so we’re skating to where the puck is going to be,” he says. 

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special section

Corporate 100—Corporate Spotlight

Fairbanks Memorial Hospital ‘People First’ By Julie Stricker

airbanks Memorial Hospital is a business that holds its community close to its heart. As the primary healthcare center for Interior Alaska, the facility has been working to provide treatment options formerly found only in Anchorage or hospitals outside the state. “The hospital is vital to the community as the sole community provider of hospital care,” says spokeswoman Clover Tiffany. “We truly believe in ‘People First,’ and so, between the Greater Fairbanks Community Hospital Foundation and FMH [Fairbanks Memorial Hospital], we find ways to provide the services our community needs. Patients don’t need to travel outside of Fairbanks or Alaska to receive those services and can recover at home, closer to family and friends and support systems.” The hospital has 152 licensed beds, and staff oversaw 1,111 births and discharged 5,290 patients in 2012, the most recent statistics available, Tiffany says. Another 32,251 patients visited the emergency room and 150,367 utilized outpatient services. Fairbanks Memorial Hospital and its equipment are owned by the foundation, which has a management agreement with Banner Health. Banner Health is a nonprofit based in 140

Alaska Business Monthly | April 2014

Phoenix, Arizona. It operates twentyfour hospitals and other health-related entities in seven states. The hospital employs approximately 1,300 people and had $214 million in adjusted net revenue for 2012. “Over 90 percent of that comes back or stays in the state through salaries, benefits, supplies, utilities, etc.,” Tiffany says.

Early Beginnings in 1906 Fairbanks Memorial Hospital has its roots in the former St. Joseph’s Hospital, which dates to the first years of the city. Begun in 1906 by Jesuit priest the Reverend Francis M. Monroe, it was one of the first frame buildings in the fledgling community largely made of log structures. The hospital had thirty-five beds and the nuns of St. Joseph’s Church were the nurses. In 1910, the Sisters of Charity took over hospital operations. The hospital served the town for decades, but by the middle of the 1960s, the sisters told city leaders they could no longer expand or replace the facility and would close it in 1967. The devastating 1967 flood damaged the hospital, which sat just off the banks of the Chena River. A $5.5 million bond issue to construction a new hospital was turned down by

voters and a decision was made to build and operate the hospital as a nonprofit, community-owned facility.

Forty Years of Growth A nonprofit foundation, the Greater Fairbanks Community Hospital Foundation, was formed in 1968 to oversee construction of a larger, more modern facility. Working with the Lutheran Hospital and Homes Society, the foundation began raising funds to build the new facility. The city of Fairbanks donated twenty-five acres of land at Cowles Street and 16th Ave. In 1972, the $8.5 million hospital opened its doors, debt-free. It was operated by the Lutheran Hospital and Homes Society. The hospital initially held 88 beds, but increased capacity to 116 beds in 1974. The foundation’s twenty-five-member all-volunteer board of trustees is made up of foundation members, hospital medical staff, and Banner Health employees and owns the hospital “solely for the benefit of the community.” It holds an open meeting annually to inform members and the community of its actions and hear suggestions for future upgrades. One theme has been consistent: Fairbanks and Interior Alaska residents need treatment options close to home. www.akbizmag.com

Fairbanks Memorial Hospital continues to add new facilities to meet the needs of Interior Alaskans. Photo courtesy Fairbanks Memorial Hospital

Over the past four decades, the hospital has continued to expand and update facilities, a process that continues today as the staff adopts modern medical technology and treatment methods. Some highlights: ■ The seventy thousand-square-foot North Tower was opened in 1978, as well as an intensive care unit. ■ Carriage North, now the Denali Center, was bought in 1982. ■ The ﬁve-story South Tower was completed in 1983. It added 163 beds to the facility. ■ In 1994, the new $15 million Denali Center was completed. It is a ninety-bed long- and short-term care facility adjacent to the hospital. The center has four wings, designed with a neighborhood feel, with plants and visits by pets. It follows the Eden Alternative, which focuses on creating a warm, happy environment. One wing focuses on short-term care for patients who have had amputations, orthopedic procedures, spinal cord injuries, and brain injuries. Another wing houses patients with Alzheimer’s disease and other age-related forms of dementia. ■ An outpatient facility was built in 1996 and a sleep lab opened. The Sleep www.akbizmag.com

Disorders Center melds its high-tech facilities with a homelike atmosphere to help patients feel as comfortable as possible. It has three rooms designated for sleep studies to help diagnose and treat insomnia, excessive sleepiness, sleep apnea, and restless leg syndrome. ■ A $9.5 million, sixteen thousandsquare-foot cancer treatment center opened in 2000. It was dedicated in honor of J. Michael Carroll in 2011, a much-loved oncologist who was instrumental in the construction of the facility. It is the ﬁrst accredited cancer care program in Alaska and the only accredited breast cancer center in the state. Prior to its opening, Fairbanks resident had to travel to Anchorage or Seattle for radiation therapy. ■ The ﬁfty-seven thousand-squarefoot Fairbanks Imaging Center opened in 2005 and works in tandem with the hospital and cancer center, as well as providing outpatient service. The center is all digital. The staff uses Picture Archiving and Communications System technology to communicate with doctors and send images securely over the Internet. ■ The foundation purchased the Tanana Valley Clinic in 2008. The clinic,

located on Noble Street, provides general medical care for families. It includes family practice, internal medicine, obstetrician and gynecology services, and pediatrics. The facility has undergone extensive remodeling over the past few years, resulting in expanded capacity for family services, women’s health, and pediatrics. The adjacent 1st Care Center is a walk-in medical clinic open seven days a week. It provides immediate care for injuries and illnesses such as respiratory illness, ﬂu, ear infections, gastro-intestinal illness, burns, sprains, and fractures and infections. A full-service lab and X-rays are also available on-site. ■ In 2010, the Harry and Sally Porter Heart Center opened. Harry Porter was a major impetus behind the foundation’s effort to build a new hospital after St. Joseph’s closed in 1967. In 2012, the center had 8,732 visits and performed 837 heart catheterization procedures.

New Technologies The hospital is continuing to grow and adopt new technologies. In 2013, the hospital began using a robotic surgery tool called a da Vinci Robotics Surgical System. The $2 million tool gives doctors more control over delicate operations, such as minimally invasive laparoscopic surgery. In February, the Alaska Industrial Development and Export Authority approved up to $60 million in bonds for additional improvements at Fairbanks Memorial Hospital. The money will be used to build a new surgery wing, which is sorely needed, Tiffany says. “Our surgery suites are in the oldest part of our facility, built in 1972, and are not adequate for today’s technology,” she says. The surgery center is will take about three years to build and employ about 150 people over that time. It is scheduled to open in 2017.  Julie Stricker is a journalist living near Fairbanks. April 2014 | Alaska Business Monthly

141

special section

Corporate 100—Corporate Spotlight

Franz Bakery Alaskans kneading the dough By Julie Stricker

ext time you drive down Spenard Road in Anchorage, take a minute to roll down your window. When you reach the intersection with Hillcrest Drive you may be rewarded with the heavenly scent of fresh-baked bread from Franz Bakery, a neighborhood landmark that is Alaska’s only wholesale bakery. The bakery, formerly called Sunrise Bakery, opened in 1951 when Alaska was still a territory and is a local landmark. It employs about one hundred people and

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Alaska Business Monthly | April 2014

produces about one hundred different baked products under a variety of labels, including Franz and Alaska Grains, distributed to Alaska grocery stores, restaurants, and institutional clients. The only part of Alaska the Spenard bakery doesn’t supply is the Southeast Panhandle, which gets its bread from a Franz Bakery in the Seattle area. “It’s much better to have bread that is baked here in Alaska than to bring it up frozen,” says General Manager Larry Brandt, echoing Sunrise’s longstanding slogan, “2,000 miles fresher.” Franz Bakery has been making bread, buns, and pastries for more than a century. It is a fourth-generation familyowned business that was started in 1906 in Portland, Oregon, and today has seven bakeries and operations throughout the Pacific Northwest. Its trademark is a giant rotating loaf of bread perched above its Portland facility.

The Process The Spenard facility can produce about seventy loaves of bread per minute and fift y packages of hamburger buns per minute, Brandt says. “For our industry, we’re not as automated as a lot of facilities, but we are far more automated than a small little wholesale or retail bakery,” he says. The process starts with the flour, which is moved through a giant sifter and then mixed with the proper ratios of water and yeast for the type of bread to be made. This creates the “sponge.” The sponge is put into big troughs and left in a warm, humid room to rise for four hours. Then the other ingredients, grains, seeds, fruit, etc., are mixed in to form the dough. The dough is shaped into smaller pieces to form loaves, rolls, or buns, which are left to rise again briefly before being shaped and placed into baking pans. The dough rises a final time before being loaded into a giant oven to be baked. The bread is then cooled, sliced, packaged, and delivered. Although white and wheat bread and buns are bakery staples, Franz also bakes a variety of specialty loaves such as cranberryorange bread, peach cobbler bread, organic wholegrain and seed breads, as well as bagels, cookies, muffins, and snacks that are dead ringers for Hostwww.akbizmag.com

ess’ Twinkies and cupcakes. The sweets are made elsewhere and shipped to Alaska. The Spenard facility bakes mostly bread and buns. Fun fact: According to the company’s website, Englebert Franz developed the first hamburger bun in 1926. Today, Franz Bakery supplies nearly every fast-food restaurant in the Northwest with buns.

Outside Ingredients, Alaskan Workers The bakery in Spenard goes through hundreds of thousands of pounds of flour and thousands of pounds of yeast and sugar annually. Of course, the ingredients are shipped from Outside. “There are not a lot of ingredients we can purchase in Alaska,” Brandt says. “We can’t buy wheat flour in Alaska. We can’t buy sugar in Alaska. We’re not an agricultural state.” But, the bread is fresh and local and in an increasingly health- and energyconscious market, that counts for a lot. Over the decades, bread trends have changed and your average loaf of white bread now has a lot of competition on store shelves. “The trends have definitely moved more toward breads that have more grains in them, more gluten-free, more organic breads,” Brandt says. The company also recently unveiled new gluten-free products, but those aren’t produced in Anchorage, Brandt says. “Gluten-free products require a separate processing facility, one where there are no wheat products onsite.” The bakery in Spenard was wellknown for its on-site retail outlet, where residents could buy cut-price bread and buns. Sunrise Bakery had been selling Hostess products since 1962. It supplied bread to grocery stores, restaurants, and large institutional customers such as the Anchorage School District and donated tens of thousands of pounds of bread products to the Food Bank of Alaska. “I’ve been here and in this bakery, except when it was shut, for twenty-seven years,” says Brandt, a second-generation Sunrise Bakery employee who was born and raised in Alaska. The bakery closed its doors for about six months after previous owner Hostess Brands, Inc. went out of business in fall 2012, shuttering bakeries across the country and leading to a rush for www.akbizmag.com

Wonder Bread, Twinkies, and other snack foods. Hostess blamed a failed agreement with union workers for the shutdown, although Anchorage workers were not part of that union. The shutdown took workers by surprise—they came in to work only to be told the bakery would be closed at the end of the day. About ninety people lost their jobs, many of whom had worked at the bakery for twenty or thirty years. It also surprised the local businesses who relied on bread from Sunrise, leaving them scrambling for replacements that often had to be shipped across the country.

Franz Steps In In April 2013, Franz bought Sunrise and several other former Hostess Brands bakeries in the Pacific Northwest. The $30.85 million sale, which had to be approved by the US Bankruptcy Court in New York, included four bakeries, fourteen depots, and a fleet of vehicles that supported operations across Washington, Montana, Idaho, Utah, and Alaska. “We’re excited to move forward with reopening the Sunrise Bakery and start supplying Alaska with fresh bread products,” Marc Albers, president of the Portland-based Franz Bakery, stated in a news release at the time of the purchase. “We’re also looking forward to contributing to the Anchorage economy by providing jobs.” Brandt started working for Franz on

April 12, 2013, and many of the people who worked at Sunrise also were rehired. The first loaves of bread under the Franz label went on store shelves on May 15, 2013. “Probably a little less than half of the employees who were working at the bakery before it closed have returned,” Brandt says of the bakery’s current employees. In a nod to Sunrise’s history, Franz left the original style of the old bakery’s name on the building in Spenard, incorporating its branding. It also reopened two of Sunrise’s former outlet stores in Anchorage and Wasilla. Brandt says the move under the Franz corporate umbrella has been a good one. Franz is more community oriented, more family-oriented than Hostess, Brandt says. They donate to many charities such as Ronald McDonald House and sponsor community events and sports teams. For instance, Anchorage bakery workers participated in the Polar Plunge in January to help raise money for Special Olympics. They gave away grilled cheese sandwiches and cookies. The bakery itself offers tours, something Hostess had not permitted for years. Or, residents can just stand outside and inhale the warm, yeasty smell of fresh-from-the-oven bread as they’ve done for decades in Spenard.  Julie Stricker is a journalist living near Fairbanks. April 2014 | Alaska Business Monthly

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special section

Corporate 100—Philanthropy

Trends in Corporate Giving Year-over-year model helps execs make a difference By Nicole A. Bonham Colby

espite the country still reeling from its recent recession, many companies have not slowed down in their creative efforts to give locally to their clients and customers. Alaska operators are no exception. From in-kind donations of equipment to local schools, to high dollar corporate financial gifts to regional universities, or even sponsorship of cultural heritage preservation efforts, Alaska’s corporate operators make giving a part of their culture. The unusual efforts of one landservices company serving the oil and gas industry is indicative of a growing trend toward substituting gifts of philanthropic social responsibility—do-

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nated in the name of the recipient client or customer—instead of a more traditional, tangible gift over the holidays. In the case of the land-services company, the owner chose to give each of its largest clients a “Gift Ark” from Heifer International, a seventy-year-old Arkansas-based charitable-aid provider founded by a Midwest farmer who sought to send livestock to the world’s poorest regions. It was his belief that providing tools and skills, such as farming, can make a long-term difference. The Ark package includes two of several types of local livestock, as well as bees, chicks, rabbits, and the like. Given in the name of the gift recipient, the collection of livestock itself goes to a needy

community. The concept is designed to care for an impoverished community, to provide ongoing income opportunities for its people, and to encourage sustainable farming worldwide. A drastic departure from a case of champagne, a luxury pen set, or expensive dinner party, such gifts reflect the trend toward increased non-cash corporate giving with a philanthropic flair.

Non-Cash Gifts Increase Such trends are analyzed in the national report, “Giving in Numbers: 2013 Edition,” which offers senior executives a tool to analyze and grow their own companies’ corporate giving programs. The annual benchmark publication is www.akbizmag.com

developed each year by the business research association The Conference Board in partnership with the organization CECP, which was formed in 1998 by Paul Newman and business leaders John C. Whitehead, Peter L. Malkin, Walter Shipley and others, originally known as the Committee Encouraging Corporate Philanthropy. With a current membership of about 180 CEOs and chairpersons from companies that represent some $10 billion in annual corporate giving, the organization’s mission is to help companies directly affect local communities through philanthropy. The 2013 report constitutes the ninth report by the group concerning such trends. Along with facts and figures analyzing the previous year’s contribution data, the publication also offers executives and managers tools and benchmarks to help deploy responsible charitable giving across their own organizational structures. Such tools include a step-bystep guide and template for employing a year-over-year giving model. The 2013 report indicates some $20 billion in total contributions last year, reflecting data from 240 companies. Findings include that charitable contributions from participating companies increased 59 percent from 2007 to 2012, with some 38 percent of participating companies having increased their giving by one-fourth or more in that period. Companies that gave non-cash contributions—products, use of company facilities, and other assets—in 2007 had increased their non-cash gifts 38 percent by 2012, according to the report. Companies are finding increased favor with corporate gifts to education. The academic arena of higher education and K-12 education constituted the “most funded program area” for all companies that reported data. The academic sector received 29 percent of companies’ charitable allocation. Perhaps one of the more unusual areas where companies provide donations is the paid-release-time volunteer program, where companies encourage—and pay—the workers to participate in local volunteer efforts to improve the local community. That sector of corporate giving has increased from 53 percent of participating companies offering such donation in 2007 to 70 percent in 2012. www.akbizmag.com

With 2013 figures, researchers will determine if the companies’ 2012 forecasts came true. In 2012, 40 percent of participating companies anticipated an increase in their corporate giving, with 18 percent planning a reduction and 42 percent anticipating no change in contribution levels, according to the report.

Alaska-Sized Gifts One of the largest and most prominent examples of corporate giving to come to fruition last year was undeniably the BP Asset Integrity and Corrosion (AIC) Laboratory, reflecting a $1 million donation from BP Alaska in partnership with the University of Alaska Anchorage. The company and university also teamed up for the summer robotics camp, sponsored by BP Alaska and administered by the university. The camp taught an average of forty students a week from area middle and high schools basic robotics skills and sought to cultivate an interest in engineering. Another milestone in corporate giving in Alaska came last year with the state’s namesake airline offering a decade-long commitment of corporate contribution

to the University of Alaska Anchorage. In March 2013, the university’s chancellor announced naming the new on-campus arena the Alaska Airlines Center in honor of the agreement. As part of the deal, the airline offered a $1 million scholarship endowment for student athletes, plus a $5.3 million athletics sponsorship contract, with a portion of the overall agreement offering travel for the athletic teams. In announcing the arena name, university officials recognized the company’s morethan-quarter-century of sponsorship and support of the UAA athletics program.

Cruise Industry Giving Two cruise companies that feature Alaska itineraries partnered last fall to donate $1 million to the University of Alaska Foundation to fund three primary areas: research and academic efforts related to the health of the sea, scholarships to help Alaskans seek higher education, and tourism and travel industryrelated training for Alaskans. Both companies had previously sent some of their corporate giving dollars north, with Princess Cruises donating $100,000 in 2009 to the Marine Advisory

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The concept of social responsibility through corporate charitable gifts is not a new idea, but it is one that is gaining new traction with managers and executives who see the long-term value from strengthening the communities where they operate. Program at the university. Holland America Line years earlier donated $15,000 toward a study that eventually resulted in the university’s Culinary Arts & Hospitality Program, which currently graduates roughly forty students each year, according to the university. In more recent years, Holland America Line has given more than $1 million to the university. That interest in supporting education and training is reflected in the national CECP report, which attributes the growth in education donations to recognition by companies of the “pipeline” that exists from education to developing an available workforce. It appears from the data gathered that companies are wishing to help train and grow their own future labor pool of talent by developing on-target training programs through donations to regional academic institutions present in their operations footprint.

Preserving Alaska’s Culture Many times, the beneficiaries of corporate gifts are those who comprise the contributor’s local client base. Last August, the Bethel-based Association of Village Council Presidents’ cultural heritage center, known as the Yupiit Piciryarait 146

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Museum, was the recipient of a $10,000 donation from First National Bank Alaska. The bank, Alaskan owned and operated since 1922, operates its Kuskokwim Branch in Bethel, among the bank’s thirty branches stretched across eighteen Alaska communities. The museum serves as a local repository of cultural artifacts and art from the Yukon-Kuskokwim Delta area, according to the bank. According to the national CECP report, support of culture and the arts comprised 5 percent of the charitable giving among participating companies. Civic and public affairs comprised an additional 5 percent of corporate gifts.

Supporting Improved Health and Welfare Interest in improving health and social services resulted in 28 percent of charitable corporate gifts tracked by the CECP report in 2012. In Alaska, Northrim Bank provides one example of a company that focused a portion of its giving toward the health and welfare sector. The company contributed $2,000 for building improvements to the Safe Harbor Inn, which provides transitional housing for Alaska’s homeless families

and disabled residents. Northrim also contributed $2,500 to the final phase of the Arc of Anchorage’s “Five Homes in Five Years” program to provide housing for disabled and low-income Alaskans. Last September, Northrim contributed $15,000 for the new Covenant House Alaska, which provides Alaska’s youth with shelter from the streets. The new facility houses both an emergency youth shelter and youth management center, according to a release by the bank.

Give and Give Again The concept of social responsibility through corporate charitable gifts is not a new idea, but it is one that is gaining new traction with managers and executives who see the long-term value from strengthening the communities where they operate. Whether through an education grant, a workforce development program, or a training facility, today’s executives have unique tools available to make a difference—not just during the holidays, but year-round and from year-to-year.  Attorney and author Nicole A. Bonham Colby writes from Ketchikan. www.akbizmag.com

THANK YOU for keeping Alaskans on the road to a better life.

2013 MILLION DOLLAR CHAMPIONS

$1,000,000 + in combined employee and corporate gifts

2013 KEY CORPORATE SPONSORS

$100,000 + in combined employee and corporate gifts Alaska Communications* Alyeska Pipeline Service Company Anchorage School District Charitable Giving Campaign CIRI Doyon Drilling, Inc.* Enstar Natural Gas Company* ExxonMobil* First National Bank Alaska* GCI*

NANA Family of Companies: NANA Construction NANA Development Corporation NANA Management Services NANA Regional Corporation NANA WorleyParsons NANA WHPacific, Inc. Pegasus Aviation Services

Northrim Bank Peak Oilfield Service Company

Pioneer Natural Resources Alaska, Inc.* Providence Health & Services Alaska* State of Alaska SHARE Charitable Campaign UPS Wells Fargo * Indicates Dramatic Increase: 10% or more over previous year. For a list of all of our partner companies, visit LiveUnitedAnchorage.org

To learn how you can join these and hundreds of other Anchorage companies who are advancing Education, Income, and Health to improve lives and build a stronger community for us all, visit LiveUnitedAnchorage.org

United Way of Anchorage

special section

Corporate 100

Economic Impact of the Corporate 100 Afognak Native Corp./Alutiiq Afognak’s purpose is to optimize financial benefits and land use, and preserve our culture for the well-being of our shareholders. Afognak succeeds at this through a diversified business approach with our companies operating in more than 30 countries and provinces throughout the world, employing thousands. Ahtna, Inc. In 2013, Ahtna employed more than 1,600 professionals around the world, 300 of whom were based in Alaska and 25 percent of these Alaska employees were Ahtna shareholders. Ahtna also provided nearly $1.3 million in shareholder and Elder dividends in 2013. Alaska Airlines Alaska Airlines and Horizon Air directly and indirectly help create jobs, support small business and diverse suppliers, and provide the necessary transportation infrastructure for economic activity in Alaska. Alaska Commercial Co. Rural Alaska’s largest private business employer of First Alaskans. Last year in rural Alaskan communities, ACC invested $22.5 million in payroll and benefits; $20.8 million in freight services; $3.8 million in rents; and $6.6 million with local utility companies. Alaska Communications Alaska Communications has 148

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invested more than $500 million in Alaska since 2001. We know keeping Alaskans and Alaska business connected and providing reliable services is crucial to keeping a vital economy running. Alaska Industrial Hardware Inc. AIH opened a new 53,000-square-foot Super Hardware Store in south Anchorage in 2012. Alaska Regional Hospital In addition to providing high quality, cost effective healthcare to our friends and neighbors, we further support the community through taxes paid each year to local and state government for schools, roads, and public safety programs. Alaska USA Federal Credit Union Alaska USA Federal Credit Union is the most recommended financial institution in Alaska, serving 1 in 3 Alaskans who are member-owners. In Alaska, members utilize our network of 34 branches, 12 mortgage offices, 8 title and escrow offices, 4 insurance offices, 1 trust office, online services, and call center. Alaska Village Electric Cooperative Inc. We provide a few local jobs and reliable energy to local businesses. Aleut Corporation The Aleut Corporation provides various programs for its

shareholders, including but not limited to, dividends, scholarships, vocational training, burial assistance, cultural camps, etc. Alyeska Pipeline Service Co. Alaskans often refer to TAPS as the state’s economic artery. Alyeska has more than 800 employees statewide and contracts with thousands more. Revenues from the pipeline fund more than 90 percent of Alaska’s state budget, paying for things like schools, roads, public safety, and the Permanent Fund. Alyeska Resort Provides jobs for 700 Anchorage and Girdwood residents. Guests also visit local businesses while at the resort (shopping, activities, restaurants). American Fast Freight, Inc. Delivering building materials, fresh produce, household goods, and many other items to the people of Alaska. American Seafoods Group LLC Maximize the value of fishery resources off the coast of Alaska, employment, support for fishery research, economic contributions to Alaskan communities. Arctic Slope Regional Corporation Since incorporation, ASRC has distributed a total of more than three quarters of a billion dollars in dividends to its shareholders. Besides dividends, ASRC shareholders have also benefited www.akbizmag.com

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from employment, education, and training opportunities. AT&T In the first half of 2013, AT&T had a capital investment of nearly $45 million in Alaska. Bering Straits Native Corporation Bering Straits responsibly pursues business opportunities while placing a high emphasis on in-region economic development. Bering Straits is committed to providing meaningful benefits to shareholders and in 2013 the company returned a record dividend to its shareholders. BP Exploration (Alaska) Inc. BP Alaska has roughly 2,300 employees and more than 6,500 contractors. The company spent more than $1.59 billion with Alaska companies in 2012, with overall spending in Alaska more than $2.07 billion. Bristol Bay Native Corporation BBNC employs over 1,300 Alaskans in the construction, oilfield and industrial, and government service industries. Last year BBNC awarded over $480,000 in scholarships and distributed $13.8 million in dividends to its shareholders. Annually, BBNC makes $500,000 in corporate contributions in Alaska. Calista Corporation Calista’s family of companies operate throughout the state, from Sitka to Juneau, Anchorage to Fairbanks, Kodiak Island to the Seward Peninsula, and on the North Slope. We are a partner in Alaska’s economy by building infrastructure and providing jobs. Carlile Transportation Systems 150

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Supports AWCC, Alaska Aces, Fairbanks Ice Dogs, Anchorage Opera and Symphony, Food Bank, AK Sealife Center, Homer Food Pantry, BBBS, and Mountain View Elementary. Carrs Safeway Creating jobs, tax revenues. CCI Industrial Services, LLC Our economic contribution can be measured by our commitment to providing customer satisfaction to our clients for two and a half decades; by being Alaskan owned and Alaska based; and by employing an Alaskan workforce. Central Peninsula Hospital Central Peninsula Hospital (CPH) is a 49-bed, acute care hospital serving the central region of the Kenai Peninsula. CPH is the largest non-government employer on the Peninsula with over 650 FTE’s. The hospital is leased from the borough and operated by CPGH, Inc., a private nonproﬁt corporation. CH2M HILL Seventh largest employer in Alaska with over $300 million in facility, equipment, and infrastructure investment. Chenega Corporation $390,000 distributed to Chenega shareholders and descendants for education scholarships each year, a majority of which goes to educational institutions in Alaska. Our Alaska-based hotels and electrical/telecom/power generation systems subsidiaries support local businesses as suppliers and subcontractors. Chugach Alaska Corporation Chugach is a developing economic driver for Alaska, contributing 500 jobs to our growing

statewide workforce. While we operate worldwide, Chugach is Alaska-based and distributes profits throughout the state through local jobs, shareholder benefits, community support, and business relationships. Coeur Alaska Inc. 306 full-time, year-round employees. Over $38 million in direct annual payroll and benefits budgeted for 2013. Second largest private employer in terms of payroll and largest payer of property tax in the City and Borough of Juneau. Colville Inc. Recently opened Brooks Camp, a 190-room state-of-theart oilfield residence camp in Deadhorse. Colville is committed to retaining and renewing current market share and successfully making our clients competitive in a dynamic marketplace. ConocoPhillips Alaska, Inc. In 2012 invested more than $828 million in capital projects in Alaska; paid more than $2.6 billion in taxes to the State of Alaska; paid an additional $1.17 billion in state royalties; and paid an additional $1.13 billion to the federal government. Construction Machinery Industrial CMI is one of the largest heavy and mining equipment suppliers in Alaska. Credit Union 1 Credit Union 1 is a proud contributor to the health of Alaska’s economy. Not only do we employ over 300 Alaskans, but we work hard to promote positive financial habits statewide. Through our Discover Financial Fitness program, we provide free www.akbizmag.com

education on how to save money, manage debt, and more. Crowley Solutions Crowley Solutions provides services that directly impact the development opportunities in Alaska. Infrastructure development including gas and oil exploration and development projects provide jobs and economic opportunity for Alaskans. Cruz Construction We invest our money into the communities we work in by hiring local and buying local. Davis Constructors & Engineers, Inc. The economic impact of hiring local contractors generates local jobs and income. The payrolls and proﬁts from this circulates and recirculates throughout the local economy, generating more jobs and opportunities.

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

Delta Western Inc. Industry competitiveness while creating Alaskan jobs statewide. Denali Alaskan Federal Credit Union Denali Alaskan is a partner in our members’ ﬁnancial success. We provide the fuel to drive the ﬁnancial needs of thousands of Alaskans and Alaska businesses every day. Doyon, Limited Doyon invested approximately $96 million in its businesses, most of which was in Alaska. In 2013, Doyon issued its 27th consecutive dividend to nearly 19,000 shareholders. ENSTAR Natural Gas Co. ENSTAR’s residential and commercial rates have remained among the lowest in the United www.akbizmag.com

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States while gas usage perresidential-customer is the highest among investor-owned utilities due to the extremes Alaska experiences during winter heating months. Era Helicopters LLC From Juneau to Kenai to Anchorage and on the North Slope, Era Helicopters is supporting the major industries with aviation services and providing year-round employment for Alaskans. Fairweather LLC Fairweather provides jobs for more than 140 Alaskans in the natural resource development industry. FedEx Express FedEx Express employs over 1,000 people in the state of Alaska. This includes ﬂight crew members, maintenance personnel, and FedEx Express partner companies such as FedEx Trade Networks. First National Bank Alaska First National Bank Alaska is a fullservice commercial bank serving Alaskans with a broad range of deposit and lending services, trust and investment management services, and internet banking. Foss Maritime Company Foss has been operating in Alaska for more than a century. We continue to expand our assets with three arctic-class tugs underway at our Rainier, Oregon, shipyard. We have partnered with the energy services arm of the Arctic Slope Regional Corporation, which will provide expanded opportunities and jobs. Franz Bakery Franz Alaska employs 100 people 152

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from our Anchorage Bakery and ships fresh baked goods throughout the state of Alaska. GCI Investing hundreds of millions of dollars in our network over the next several years to provide Alaskan’s with the most robust products and services. Providing nearly 2,000 jobs to Alaska’s growing workforce. Geneva Woods GWP contributes to the economic growth by being the largest provider in Alaska that provides healthcare related products and equipment ordered by community healthcare providers throughout the entire State. That includes medication and infusions to the bush communities. GWP employs 182 people in a state of the art facility. Granite Construction Company On average Granite employs 300 people during construction season and purchases materials and supplies locally, supporting many more Alaskans. Gray Line of Alaska Gray Line of Alaska purchases services and products from more than 1,000 Alaska businesses. Great Northwest Inc. Great Northwest employs hundreds of Alaskan residents each year. Great Northwest provides the type of work that develops into prosperous careers for residents, all the while assuring a positive employment forecast. Holland America Line Holland America Line supports Alaska businesses through the purchase of services and products made in Alaska.

Homer Electric Association Inc. Homer Electric celebrated a milestone in 2014 by completing the construction of its Nikiski Combined Cycle plant and independently providing power to over 22,420 members. HEA provides jobs to 158 employees in its Homer and Kenai offices, Nikiski Generation Plant, and Bradley Lake Hydroelectric Plant. Horizon Lines LLC HL will continue to focus on operating efficiencies to provide significant advantages for our customers with emphasis on overhead cost controls. National companies continue to bring new business to Alaska and we remain cautiously optimistic for 2014. Jacobs Jacobs directly employees 70 Alaskans and 60 percent of our local revenue is subcontracted to Alaskan businesses. Kakivik Asset Management, LLC We assist our clients in achieving the safe and efficient operation of their facilities, extending the useful life of their infrastructure components, achieving regulatory compliance, and avoiding environmental catastrophe. In short, we help keep the oil flowing and prevent catastrophic disasters. Koniag, Inc. Koniag has evolved to meet new challenges, expanding opportunities, and the needs of its shareholders. The corporation’s investments range among real estate holdings, resource development, and business operations that include oversight of several subsidiaries. www.akbizmag.com

Linc Energy Ltd. Linc is investing $60 million annually in Alaska. Lynden Inc. Lynden has served the transportation needs of Alaska since 1954, when we became the ﬁrst to provide regular service via the Alcan Highway. Today, the Lynden family of companies are a vital part of the Alaskan economy, serving as a critical link to commerce by moving cargo via land, sea and air. Matanuska Valley Federal Credit Union Developing the economic health and stability of the commuities that we serve, one member at a time. MTA Inc. MTA is an economic force, providing close to 300 jobs, state-of-the-art telecom services, and injecting capital into the many communities we serve from Eagle River to Healy, from Tyonek to Sutton, and throughout the Mat-Su Valley.

aspects that set our service apart. You’ll ﬁnd us speaking regularly at events, including our own economic luncheons.

maintained its focus on quality and safety while employing generations of Alaskans to build millions of dollars’ worth of commercial, industrial, civil, and housing projects for state and federal agencies.

Offshore Systems Inc. Fishing, oil and gas industry, Arctic exploration.

Pacific Alaska Freightways Inc. Construction, retail, ﬁshing industry, and oil and gas.

Olgoonik Corporation Our Alaska revenue was $64M in 2013 with operations supplying year-round work and development opportunities. With a focus on job and infrastructure growth at home in Wainwright, we contribute statewide through donations to nonproﬁts that support Alaska Native, education, youth, and health programs.

Price Gregory International Oil and gas development projects; utilities. Princess Alaska Lodges Princess Lodges purchases services and products from more than 1,000 Alaska businesses. Pruhs Construction Business with suppliers, equipment companies, and Alaskan subcontractors.

Osborne Construction Co. A proud part of the Alaska construction community since 1988, Osborne Construction has

NANA WorleyParsons Provides employment for over 500 Alaska based positions. Northern Air Cargo Northern Air Cargo has provided air freight services crucial to the livelihood of Alaska’s rural communities and economic development and vitality for more than 55 years. NAC employs over 340 people in Anchorage. Northrim Bank Northrim, a community bank, is a reﬂection of Alaska’s economy. The resources we dedicate to understanding the economy, and the commitment we have to sharing that knowledge, are www.akbizmag.com

907.561.4300 www.aleutcorp.com

LET’S DO BUSINESS!

Government, Industry, Real Estate The Aleut Family of Companies is ready to serve your unique needs. We invite you to explore our professional services.

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Ravn Alaska Over $44 million in FTE wages.

us both interesting and very affordable.

Roger Hickel Contracting Inc. Continued heavy industrial, commercial building, and road projects—both private and public jobs.

Ukpeagvik Inupiat Corporation (UIC) We focus on creative decisions that produce growth and beneﬁts for our clients, corporation, and over 2,500 Inupiat shareholders. We are committed to providing stable shareholder dividends and our subsidiaries play a vital role in this mission by returning proﬁts made to our Barrow headquarters.

Shell Exploration & Production Co. Since 2006 Shell has spent over $5 billion on the Alaska Venture. SMG of Alaska, Inc. $25,496,180 in 2013. Tesoro Alaska Co. Tesoro is the largest taxpayer in the Kenai Peninsula Borough and employees over 550 Alaskans. The Odom Corporation The Odom Corporation is the largest beverage distributor in Alaska. Odom employs over 400 full-time employees with a payroll of $21M. The Odom Corporation has been locally owned by an Alaskan family for nearly 80 years with operations in Anchorage, Fairbanks, Juneau, Kodiak, and Ketchikan. The Tatitlek Corporation The Tatitlek Corporation impacts the Alaskan economy by providing jobs, dividends, scholarships, hosting local events, maintaining memberships to Alaska organizations such as the Anchorage Chamber of Commerce, and supporting Alaska community organizations such as the United Way. Three Bears Alaska Inc. We are one of Mat-Su Valley’s largest employers. We are an Alaska company working as hard as we can to serve our fellow Alaskans in every way we can, including keeping shopping with 154

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URS URS has more than 50,000 employees in a network of offices in nearly 50 countries and ranks No. 248 on the FORTUNE 500 list. URS Corporation is publicly held and listed on the New York Stock Exchange as URS. Usibelli Coal Mine Inc. UCM is the only operating coal mine in the state, providing the Interior with its lowest cost and most reliable source of energy and jobs for hundreds of Alaskans for over 70 years. UCM is headquartered in Healy and has satellite offices in Fairbanks and Palmer. USKH Inc. USKH is an employee-owned multidiscipline design firm with offices in four Alaska communities. We employ nearly 100 Alaskans and more than 130 including our Lower 48 offices. Our vision is to grow the company by 60 percent in the next 6 years. Vigor Alaska We partner with the state and Ketchikan to operate and develop AIDEA’s shipyard in Ketchikan and we commit to expanding the marine and heavy industrial

capacity of Alaska. We employ best practices for human and infrastructure development to better serve our customers and create jobs that matter. W.W. Grainger Grainger has generated over $50 million annually in sales within the state of Alaska and is looking to double that within the next three years while at the same time supporting the community through both financial and product donations annually. Watterson Construction Co. WCC’s business is entirely in Alaska and we promote and seek suppliers and subcontractors that are Alaskan. Weaver Brothers Inc. $10 million payroll, delivery of retail goods for resale to numerous companies throughout Alaska, and support of road construction, oilfield work, and associated business all over Alaska. Wells Fargo Bank N.A. Our 900 team members serve more Alaskans than any other financial services company through a network of 57 offices and 120 ATMs in 28 communities from Ketchikan to Barrow. Wells Fargo has maintained the largest market share among Alaska banks since the late 1960s. Westmark Hotels Westmark Hotels purchases services and products from many Alaska businesses. 

www.akbizmag.com

Colony Inn, Palmer

Club Paris, Anchorage

Good for health. Great for business. Research shows that smokefree policies improve the health and productivity of employees, decrease business costs for maintenance and insurance, and are routinely positive or neutral in their economic impact. Alaska’s business owners agree!

We got a lot of new customers

going non-smoking.

It was more like they expected it. People like fresh air! — Ray Legrue Henry’s Great Alaskan Restaurant, Kodiak

Humpy’s, Anchorage

Food Factory, Fairbanks

Airport Pizza, Nome

We’re smokefree for the health of our staff and customers. And we’ve seen a significant decrease in maintenance costs – it was a solid financial decision. — Scott and Lela Rosen The Duck Inn, Soldotna

RIGHT MOVES Engineer of the Year

Jeanne Bowie was named the 2013 Engineer of the Year at the Engineers Week Awards Banquet February 22 in Anchorage. Bowie was recognized for her engineering accomplish- Bowie ments, contributions to engineering knowledge through publications and outreach, and volunteer activities within and outside of the engineering community. The Engineer of the Year is selected each year by a panel of engineers representing Southcentral Alaska engineering professional societies. The award was presented as part of Anchorage National Engineers Week, a yearly event that celebrates the difference engineers make in our world and brings engineering to life for kids, educators, and parents.

Wells Fargo

Darin Floyd has been named Wells Fargo Equipment Finance territory manager for Alaska. Fl oyd h a s b e e n serving Wells Fargo customers in Alaska for seventeen years. He started his career as a Floyd management trainee and served as a Store Manager and Business Relationship Manager in Southeast Alaska before joining Wells Fargo’s Alaska Commercial Real Estate team in 2004. He is originally from Wrangell, and he graduated from Boise State University with a bachelor’s degree in business management and finance.

Bering Straits Native Corporation

Bering Straits Native Corporation (BSNC) announces the appointment of Christine Williams to its executive management team as Vice President and General Counsel. She will work with BSNC’s executive team, Board of Directors, and subsidiaries to ensure that all legal needs are met. Williams has more than ten years of corporate

Compiled by Tasha Anderson legal experience. She joins BSNC from Perkins Coie, an international law firm where she served as partner, representing clients in Alaska and the Lower 48 with a special focus on government contracts, complex litigation, mediation, arbitration and litigation, and construction law. Williams earned a Juris Doctorate from the Santa Clara University School of Law in 2001 and a bachelor’s degree from the University of Alaska in 1997.

MWH Global

Jim Gill has joined MWH Global, a wet infrastructure-focused strategic consulting, e nviro n m e nt e n gineering and construction ser vices firm, as a Principal Hydropower Engineer. In this new Gill role, Gill will provide geotechnical engineering and project development services on large hydropower projects in Alaska. Prior to joining MWH, Gill served as a senior consultant providing project management assistance on a variety hydroelectric project components in the Anchorage, Juneau, and Fairbanks area. Gill is a registered professional engineer in Alaska, and has a Master in Science in Civil Engineering from the University of Manitoba in Canada. He is based in the Anchorage office.

Denali Alaskan

Bob Shake has joined Denali Alaskan as the organization’s Chief Lending Officer, where he is responsible for all lending activity within the credit union, to include indirect lending, member business lending, Shake mortgage loans, and the VISA department, as well as loan control and loan collections. Prior to joining Denali Alaskan, Shake spent more than twenty years in senior management positions at various Alaska financial institutions. Shake

graduated from West Anchorage High School, and completed his BA in Business Administration from The Colorado College.

Ahtna, Incorporated

Ahtna, Incorporated announces that Doug Miller will join the Ahtna management team as Vice President of Human Resources. Miller comes to Ahtna from the Alaska Native Tribal Heath Consortium where he Miller served in a variety of roles from Human Resource Director to Chief Workforce Officer over a span of ten years. Miller brings sixteen years of progressive human resources experience to Ahtna and holds a Bachelor of Arts in Education and a Master of Business Administration in Human Resources.

GCI

GCI Senior Vice President & General Counsel Tina Pidgeon has been named to the 2014 class of “Women to Watch” by the publication Multichannel News, which annually r e c o g n ize s t w e l ve women from across the Pidgeon media and telecommunications industry “whose ongoing contributions are emblematic of the vital roles they will continue to play in the industry’s future.” Pidgeon was nominated for her contributions to several innovative GCI initiatives, including the TERRA network, which has brought broadband service to some of Western Alaska’s most remote communities, and the creation of the Alaska Wireless Network, which allows GCI to compete more effectively against Outside wireless providers.

Bean’s Cafe, Inc.

Bean’s Café, Inc., a local non-profit, is pleased to announce the hiring of Lauren Nelson as Volunteer

SLED DOGS & SOFAS & MILK

OH MY!

WE’RE OFF TO RURAL ALASKA

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www.akbizmag.com

RIGHT MOVES and Event Coordinator. Nelson will be responsible for management of events for Bean’s Cafe and The Children’s Lunchbox, a program of Bean’s Cafe, including The Empty Bowl, The Pour, and Nourish Their Dreams. She will also implement volunteer activities for both programs. Nelson has a BA in Justice with a minor in Political Science from the University of Alaska Anchorage. She has been volunteering since she was twelve years old.

Compiled by Tasha Anderson tribute to the development and implementation of short and long-term credit union goals and objectives. Gildersleeve will continue to oversee all aspects of Credit Union 1 facilities, ensuring smooth and efficient operations of purchasing, building maintenance, and supply delivery.

Solstice Advertising

University of Alaska Fairbanks

Bristol Bay Housing Authority

The Bristol Bay Housing Authority announces its new Executive Director, Brenda Akelkok of Dillingham, starting on April 1. A magna cum laude graduate of Eastern Illinois University, Akelkok worked as grant writer for the Bristol Bay Area Health Corporation from 2005 to 2012, when her position was elevated to grant manager for the corporation.

NANA Management Services

Eric Fox has been appointed Chief Operating Officer of NANA Management Services (NMS). Fox has been with NMS since 1992, most recently serving as vice president of the Camp Management Services Division, pro- Fox viding strategic oversight for NMS’ remote site and staffing services. Fox began his career with NMS as a security officer on the North Slope. He transferred to NMS’ Camp Services Division in 2004, where he held positions as Operations Manager and Director of Operations.

Credit Union 1

Credit Union 1 is pleased to announce the promotion of Administrative Services Manager, Josh Gildersle eve , to a member of the Senior Management team. As a member of the Senior Management team, Gildersleeve Gildersleeve will con-

Prior to Solstice Advertising, Engstrom spent two years at a local agency, first as a Graphic Designer and then as the Senior Web Designer. Several years of freelance work polished her extensive experience in branding, print, and web design. Engstrom holds a Bachelor of Science in Graphic Design with a minor in strategic communications/advertising from the University of Minnesota.

Spano

Engstrom

Solstice Advertising announces the addition of Client Insights Executives Laura Spano and Melissa Rodriguez, and Production Artist Niki Engstrom to its team. Spano’s history in marketing, communica- Rodriguez tions, and development, as well as her experience as a freelance designer, means she is an effective liaison between a client’s vision and the creative team at Solstice. Spano studied business administration at Washington State University, graduating with a Bachelor of Arts. She brought this background in leadership to her several years at the Alaska chapter of the American Red Cross. Rodriguez brings extensive experience in project management and leadership to Solstice. She spent nearly eight years at Anchorage’s Agnew::Beck Consulting providing contract and project management, firm management and project and consulting services. Rodriguez has a bachelor’s degree in sociology from Brandeis University in Massachusetts and studied public administration at the graduate level at University of New Mexico in Albuquerque.

Marty Rogers is the new leader of the unmanned aircraft center at the University of Alaska Fairbanks. Rogers worked as a subcontractor for the Alaska Center for Unmanned Aircraft Systems Integration before his appointment as director in January. He retired from the US Air Force. Rogers will work in tandem with Ro Bailey in directing the Pan-Pacific UAS Test Range Complex, which the Federal Aviation Administration established in December 2013.

Beacon Media + Marketing

Beacon Media + Marketing announces the addition of Business Development and Media Director, Rita Corwin, to its team. Corwin’s history in marketing, communications, and business development, as well as her experience as a long time media personality, makes her a particularly effective liaison between the local business community and the creative team at Beacon. Corwin’s vast experience in media production brings innovative resources to Beacon Media + Marketing.

The Pebble Partnership

The Pebble Partnership named Pebble CEO John Shively Chairman of the board of directors for the Pebble Project—a move that allows Shively to be a part of the strategic leadership team for advancing the project. With this move, PLP appoints Tom Collier to the position of CEO for the company. Collier has represented many Alaska-based clients over the course of his forty year career with law firm Steptoe and Johnson. Shively has served as PLP’s CEO since April of 2008 and brought extensive knowledge about Alaska resource issues and a passion for advancing opportunities for Alaska Natives to the job. Shively served two Alaska governors and helped bring the Red Dog Mine to reality at Nana Regional Corporation. 

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INSIDE ALASKA BUSINESS

Flint Hills

lint Hills Resources Alaska, LLC announced that it would cease crude oil processing at its North Pole Refinery. The extraction unit at the refinery will be shut down on May 1, ending gasoline production. Crude unit #2 will shut down shortly thereafter, depending on operational requirements, but no later than June 1. The closure of crude unit #2 will end production of jet fuel and all other refined products. The company will continue to market fuels through its terminals in Anchorage and Fairbanks. The supply for those terminals will come from another source. The company said they expect about thirty-five employees to be retained for operation of the North Pole Terminal. The tank farm associated with the terminal has 720,000 barrels of product storage, which equate to approximately 30 million gallons of product. Product for distribution to local markets can come into the FHRA North Pole terminal by truck or rail. About ten employees will also be retained at the Port of Anchorage terminal.

Petro Star, Inc.

etro Star Inc. reacted to the announcement that Flint Hills Resources is shutting down its North Pole, Alaska refinery. The Flint Hills refinery has been operating since oil started to flow through the Trans Alaska Pipeline System (TAPS) in the late 1970s. Petro Star said that although a business competitor, Flint Hills has been a good neighbor and a well-needed source of local jobs in the Interior. Petro Star Inc. said they will make every effort to help ensure that this shutdown does not create fuel shortages in the Interior. “Although we are disappointed, it does not surprise us that the refinery succumbed to the enormous financial pressures that face Alaska refiners who are dependent on TAPS,” said Doug Chapados, PSI president and CEO. “The unique economic burden of operating in Alaska coupled with the excessive fees that refiners must pay to re-inject their return oil

Compiled by ABM Staff

into TAPS will continue to suffocate Alaska refiners like Flint Hills and Petro Star.”

Vigor Industrial

he owner of Seward Ship’s Drydock has signed a letter of intent to sell the assets of the Seward, Alaska, shipyard company to Vigor Industrial. The two companies are currently negotiating the terms of the potential sale and expect the sale to be finalized after satisfactory completion of environmental, financial, and business due diligence, and after Seward Ship’s Drydock, Vigor, and the City of Seward reach a final agreement on certain details of the agreement. Seward Ship’s Drydock operates as a full service shipyard and drydock facility, in Seward, Alaska. Under the terms of the tentative deal, the Seward shipyard would join Vigor as a subsidiary of the company’s Vigor Alaska subsidiary.

Paul G. Allen Family Foundation

he Paul G. Allen Family Foundation announced its latest round of grants, which includes $465,000 to organizations in Alaska. This includes a $200,000 grant to Sealaska Heritage Insitute to help build a facility in the center of Juneau’s historic downtown district to combine its cultural, artistic, ceremonial, and office functions. The nearly thirty-thousand-square-foot Walter Soboleff Center will enable staff to display and fully contextualize the collection of Northwest Coast art and artifacts and will offer external audiences the means to study the traditions and languages of local tribal people. The Alaska Native Heritage Center received $150,000 to support a project to increase the capacity of fund development. The Bunnell Street Arts Center in Homer received $15,000 to support the 2014 Visual Art Exhibition program. The Koahnic

Broadcast Corporation in Anchorage received $50,000 to support the 2014 programming of Earthsongs. Perserverance Theatre in Douglas received $50,000 to support the planning phase of a capital campaign for the Willoughby Arts Complex.

Explore Fairbanks

he Fairbanks Convention and Visitors Bureau (FCVB) announced that the organization will be doing business under the new trade name of Explore Fairbanks. After years of deliberation, the FCVB Board of Directors approved last October to make the change effective January 1. According to FCVB President and CEO Deb Hickok, “The more succinct and contemporary name will assist in promoting the Fairbanks region in the competitive destination marketplace.” The newly designed Explore Fairbanks logo incorporates graphics to symbolize the aurora borealis and midnight sun, two key natural phenomena that distinguish the Fairbanks region, including the Interior and the Arctic, from most destinations around the globe.

Girls Scouts of Alaska

irl Scouts of Alaska had more than five-hundred girls in grades K-8 attend Anchorage Women of Science & Technology Day (WSTD), a unique program that exists only in Alaska. This signature event is the most well-attended on the Girl Scouts of Alaska calendar. WSTD was held at the UAA campus in Anchorage. Girls experienced science, technology, engineering, and math (STEM) subjects through fun, hands-on workshops led by women working in STEM careers. This is the 22nd year Girl Scouts of Alaska held WSTD. The event engages girls in STEM education in fun and relevant ways and encourages them to explore future careers in the fields of biology, ecology, veterinary medicine, geology, and engineering, among others.

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INSIDE ALASKA BUSINESS

National Geographic Channel’s Ultimate Survival Alaska

ational Geographic announces an open casting call for the next season of the show “Ultimate Survival Alaska.” Competitors on National Geographic Channel’s Ultimate Survival Alaska each week face hiking upwards of thirty miles a day; paddling through white water rapids; crossing turbulent rivers on foot; or rappelling down (or climbing up) icy cliffs—all while carrying every bit of gear needed to survive. And now those viewers at home who’ve wondered, “Hey, I think I could do that,” will get their chance to prove it with an open casting call that could earn them a spot on the next season of the series. Applications are available for download at natgeotv.com/survivalalaska. Only the toughest and most intrepid adventurers should apply. Applications will be reviewed by the production team for an opportunity to join the extreme expedition through the rugged Alaskan wilderness later this year.

Anger Management

nger Management is proud to announce that the Vans Warped Tour will be making history by heading to Alaska on June 11 at the Northway Festival Grounds behind the Northway Mall in Anchorage. This separate “Warped Tour” leg is officially named “The Road to Warped Tour.” “The Road to Warped Tour” lineup currently includes The Devil Wears Prada, YellowCard, Falling in Reverse, Less than Jake, All Time Low, and 3oh3. The event will also include a Battle of the Bands where ten bands and eight acoustic acts will be chosen to play. Brands interested in obtaining more information on sponsorship integration may do so by contacting tricia@publicrelationdivas.com.

Compiled by ABM Staff

Seward Windsong Lodge

laska Tour & Travel announced CIRI Alaska Tourism’s (CATC) Seward Windsong Lodge as the top rated Seward hotel in 2013 as selected by their clients. CATC purchased the Seward Windsong Lodge, five minutes north of Seward’s Small Boat Harbor, in the summer of 1999. The 180-room lodge features spectacular views of a glacial river valley and mountain peaks, as well as modern conference and banquet facilities, an outdoor gazebo, tour desk, internet station, and espresso bar/snack shop.

Alaska Heritage Tours

IRI Alaska Tourism Corporation’s (CATC) package tour company, Alaska Heritage Tours, is offering an escorted group tour for the first time. Known for arranging pairings of CATC and partner products to create custom vacations for the independent traveler, Alaska Heritage Tours will now connect individual guests for escorted group explorations around Southcentral Alaska led by knowledgeable guides. The Alaska National Parks Tour is an eightday, fully escorted land tour offered on five guaranteed departure dates between May and September. Starting in Anchorage, the tour takes guests through Kenai Fjords National Park and Denali National Park and features several wildlife viewing opportunities, as well as the chance to see Mount McKinley.

New Kenai Fjords Tours

his summer, visitors will get the chance to explore Kenai Fjords National Park and view glaciers and wildlife from aboard the M/V Callisto Voyager, a new eighty-three-foot aluminum catamaran. This new 150-passenger catamaran will be added to the Kenai Fjords Tours eleven-vessel fleet in time for the 2014 season. Designed by Teknicraft of New Zealand and constructed by All American Marine in Bellingham, Washington, the new ves-

sel will join two sister ships, the Aialik and Orca Voyager in the Kenai Fjords Tours fleet. This new catamaran meets the latest EPA standards for a vessel of its class and is 40 percent more fuel efficient when compared to traditional monohull boats.

Wells Fargo

ells Fargo has invested $125,000 in six Alaska nonprofit organizations that support workforce development and job creation. The grants are part of a $1.7 million Economic Opportunity program to support individual job seekers, the self-employed, and small business owners in communities along the West Coast, from Alaska to California. Grant recipients were selected for their support of workforce development programs benefiting residents of urban and rural communities. The Wells Fargo Economic Opportunity grant recipients in Alaska are Covenant House Alaska, RurAL CAP, Thread, Cook Inlet Tribal Council, and Hope Community Resources.

Credit Union 1

redit Union 1 (CU1) is pleased to announce that its One for All Alaska Fund has surpassed 2012’s total by 49 percent, showing a strong year-over-year increase since its kickoff in 2011. In 2013, the fund’s focus was “fighting childhood hunger.” Organizations that support this focus were chosen as beneficiaries in each community where CU1 has a branch. All donations remained in the communities where they were raised. A grand total of $36,107.71 was distributed from the 2013 One for All Alaska Fund to The Children’s Lunchbox (Anchorage), Interior Alaska Center for Non-Violent Living (Fairbanks), Kodiak Island Food Bank (Kodiak), Women in Safe Homes (Ketchikan), Boys & Girls Club of the Kenai Peninsula (Soldotna), Dare to Care (Eagle River), and Nome Community Center Food Bank (Nome).

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INSIDE ALASKA BUSINESS

BLM

he Bureau of Land Management (BLM) made an important land transfer to Qanirtuuq, Inc. With this patent, Qanirtuuq, Inc. received just over 130,564 acres of land surrounding the village of Quinhagak, situated on the east side of Kuskokwim Bay. The corporation’s land entitlement under the Alaska Native Claims Settlement Act of 1971 (ANCSA) is now fulfilled. Qanirtuuq, Inc., formed under ANCSA, represents the Alaska Native village of Quinahagak and received its first conveyances under ANCSA from BLM in June 1980.

Alaska Communications

laska Communications announced the purchase of 51 percent of TekMate, one of Alaska’s leading managed information technology (IT) services firms, expanding on its 2010 acquisition of 49 percent interest in TekMate. The acquisition means Alaska Communications will continue to expand its portfolio of managed network and IT solutions for its business customers in addition to its existing broadband product offerings. Being able to provide customers with endto-end, twenty-four/seven support for their broadband networks and IT infrastructure needs further solidifies Alaska Communications’ partnership with its customers. TekMate’s sixty employees will join Alaska Communications’ managed services group.

Goodwill Industries of Alaska

n February 6, Goodwill Industries of Alaska opened a Job Connections site at 610 C Street in Anchorage. Job Connections is a job search and referral program designed to help individuals obtain employment. The center is open to the public, serving individuals looking

Compiled by ABM Staff

for work and individuals looking to obtain a better job. Services include one-on-one assistance with job placement, resume writing, interview skills, and job referrals to local employers based on an individual’s experience and abilities. Job Connections also provides access to computers, email, fax machines, and telephones. Employers are encouraged to post open positions with Job Connections and staff will refer individuals with corresponding skills and experience. Goodwill Industries of Alaska is a 501c3 mission-integrated non profit enterprisefunded organization that provides services to individuals with barriers to employment.

Bezek Durst Seiser, Inc.

ezek Durst Seiser, Inc. (BDS) opened a new MatSu Valley office, located at 609 S. Knik-Goose Bay Road, Suite K. The opening of BDS’s Wasilla office marks BDS’s second office location in the state. With over three decades of design expertise, BDS has grown to include additional services: planning, programming, interior design, exterior-envelope design, and project management. BDS’s new Wasilla office provides the firm the ability to continue their record of dedicated design services and respond to the needs of communities in the MatSu Valley.

Rampart Energy Ltd.

ampart Energy Ltd. announced the successful completion of a landmark funding facility and operational update of its North Slope project in Alaska. Rampart advises it has closed an ACESbased Credit Facility with Melody Business Finance LLC, the loan origination arm of Melody Capital Partners, LP, to provide funding to support the ongoing exploration program on the North Slope. The execution of this Facility is hugely beneficial for Rampart and its shareholders as it ensures the

seismic portion of the exploration program is funded. The $50 million Facility will now fund a large percentage of the upfront cost of exploration activity, as opposed to the Company having to return to shareholders to fund exploration entirely through the issue of equity. At the conclusion of using such a Facility the Company will have no net debt as the capital provided by the Facility is paid back via the Alaskan Government’s repurchase of Tax Credit Certificates issued to Rampart.

Date-Line Digital Printing

he US Chamber of Commerce named Date-Line Digital Printing a Blue Ribbon Small Business Award winner. The annual program recognizes companies for their dedication to the principles of free enterprise and contributions to restoring jobs and supporting economic growth. DateLine was selected from a record number of applicants across the nation for demonstrating exceptional business practices in areas including strategic planning, employee development, community involvement and customer services.

White Environmental Consultants

hite Environmental Consultants, an Alaskan leader in OSHA and EPA compliance consulting, environmental contract management, on-site industrial hygiene monitoring, and training, has acquired White Laboratories, a former division of Galson Laboratories. The acquisition of White Laboratories will expand the capabilities of White Environmental Consultants by integrating consulting services with a wide range of locally available industrial hygiene laboratory services. Laboratory operations will continue at 383 Industrial Way, Suite 300 in Anchorage. 

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ALASKA THIS MONTH By Tasha Anderson

dininG

Images courtesy of The Children’s Lunchbox

The Children’s Lunchbox

laska has a near endless selection of high quality restaurants, privately owned and operated by talented Alaskans, which makes dining here a treat. But not every person has the means to enjoy going out for a meal, and many are not able to adequately feed their children. The Children’s Lunchbox, a program of Bean’s Café, has been feeding hungry children in Alaska since 1998. The program not only provides prepared meals which are delivered to more than twenty locations in Alaska, it also has the “Just a Little Extra” program, which delivers food to various sites every Friday which can be taken home for children to eat over the weekend. In 2013, more than nineteen thousand bags of weekend food were given to children. The Children’s Lunchbox provides free meals to children throughout the school year and during the summer. In 2013, The Children’s Lunchbox prepared and delivered 379,511 meals, all of which met standard portion and nutritional requirements. Thirty-six schools and programs were provided with meals, through a total of 1,969 volunteer man hours. Those looking to support this vital program can do so in a variety of ways. Volunteers are accepted to help prepare and deliver meals, and one can fill out the volunteer form online. In-kind donations are happily accepted. Most of the program’s food needs are met through the USDA surplus products and the Food Bank of Alaska, but the program’s current wish list includes dry cereal, #10 cans of fruits and vegetables, fresh eggs, breakfast meats such as sausage or bacon, lunch meat, and fresh fruit. The program is also always happy to accept monetary donations. thechildrenslunchbox.org  www.akbizmag.com

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ALASKA THIS MONTH By Tasha Anderson

trAveL

Photo by Merrill Gosho, Alaska Fisheries Science Center, NOAA Fisheries Service

Whale Fest

A gray whale breeching.

his April, travel to Kodiak to witness whales as they enact their own version of a summer get-away. Cheryl Nugent, one of the volunteer coordinators of Whale Fest Kodiak, explains: “Every April, the Eastern Pacific Gray Whale migrates past Kodiak Island. Their journey begins near the Baja Peninsula in Mexico, and they travel up the west coast to Alaska, down the Aleutian Chain, through False Pass, and continue up to the Arctic Ocean for feeding. [They] go back south in the fall. In the mid ‘90s, Whale Fest Kodiak was founded to celebrate their return to our waters.” It isn’t just a busy time for the whales—activities that take place during Whale Fest, which runs from April 18-28, include “guided hikes, talks, a shark dissection, music, art, and school projects,” Nugent says. During this time, hikes are guided by the Kodiak Audobon Society every Sunday. Participants meet at the Ferry terminal at 9:30 a.m. and carpool to the hiking areas. Nugent says, “This is a very scenic drive, and the hike offers views of the migrating Gray Whales from the beaches and trails.” Whale Fest and KAMSS (Kodiak Area Marine Science Symposium), which was first held in 2011 as a way to “bring results of Kodiak area research back to the fishermen, students, and residents of Kodiak Island,” Nugent says, are cohosting a keynote speaker to kick-off KAMSS; many of the KAMSS events will be included in the Whale Fest schedule. “The symposium will begin Tuesday, April 22, with an evening community reception and keynote speakers. Most events will be held at the Kodiak Harbor Convention Center,” she continues. All of the events in town are free and open to the public. More information about specific Whale Fest events or KAMSS can be found online. whalefestkodiak.com seagrant.uaf.edu/conferences/2014/kamss/info.php 

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ALASKA THIS MONTH By Tasha Anderson

entertAinMent

‘Audition’

Saturday, 3 May - 5:30 PM Millennium Hotel Ballroom

Photo by WenYin Metcalf

Ladies, break out your festive hats for the first great party of the summer. Enjoy mint juleps and a sumptuous buffet. The evening features a wine auction to suit every discerning palate and budget. All proceeds support the educational programs of Anchorage Opera. Sandy Harper, Cyrano’s founder and artistic director, and Dick Reichman, author and director of “Audition.”

his spring Anchorage will be the location of the world premiere of “Audition.” Dick Reichman, Cyrano’s resident playwright and the author and director of “Audition,” says his play “takes place in a small theater in a small American city, like Cyrano’s.” Describing “Audition” he says, “A famous director from New York comes to give an acting master-class; she is Simone Crystal, an ancient ex-movie star and an early member of The Actor’s Studio; she teaches her own brand of the Stanislavsky acting system. The play is the class she gives. The local actors who sign up for it are eager to overthrow their ordinary lives and follow their dreams to New York and a life in the theater. Madam Crystal is forming a new repertory company, they audition for it. Will she accept them? Will their dreams come true?” Reichman, who resides in Anchorage, has been with Cyrano’s Theatre Company since it opened in the early ‘90s. This is his ninth full-length play produced at Cyrano’s. Sandy Harper, the company’s founder and artistic director, says that while the world premiere is in Anchorage, “Audition” will also “be a main stage featured production at the nationally known Last Frontier Theatre Conference held in Valdez every year.” Cyrano’s offers a café adjunct to the theater where beer and wine may be purchased, as well as “our signature fruit and cheese plates and candy and cookies that you may enjoy in the theatre,” Harper says. Advance tickets are available through centertix.net, the PAC Box Office, and an hour before the performance at the Cyrano’s Box Office. The play runs from April 24 to May 18; with performances at 7 p.m. Thursday and Friday and 3 p.m. on Sunday. cyranos.org 

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EVENTS CALENDAR

Compiled by Tasha Anderson

AnCHOrAGe 8

Arctic Entries

In the spirit of “This American Life,” “The Moth,” and other urban storytelling events, Arctic Entries brings Alaskans to the stage to share their personal stories, funny, sad, and sweet. At each performance, seven people each tell a seven-minute long, true story relating to the show’s theme. Local musicians perform, as well. Alaska Center for the Performing Arts, 7:30 p.m. arcticentries.com

24-26

NYO Games

Each year, students from more than fifty communities across the state of Alaska participate in the Native Youth Olympic and Junior Native Youth Olympic games. Contests include the Alaskan high kick, seal hop, and many more. Dena’ina Center, various times. citci.org/event-programs/nyo-games/

FAirBAnKs 12

Bowl for Kids’ Sake

Bowl for Kids’ Sake is Big Brothers Big Sisters largest annual fundraiser. Bowlers are encouraged to register online and form teams of five to six people. Teams will bowl for one hour on the day of the event. Donations are turned in and random prizes are given out to bowlers who raise $125 or more. Arctic Bowl, 10 a.m. bbbsak.org

Summer Activity Fair

Find cool stuff for kids to do this summer at the Summer Activity Fair, which makes it easy for parents and kids to learn about all the Interior’s summer activities by bringing organizations to one convenient spot. Ask questions, get brochures, participate in hands-on activities, and sign up kids on the spot. Pioneer park, 11 a.m. explorefairbanks.com

25-26

8 X 10 Festival

This is an annual festival that features short plays, eight to twelve minutes, written by Alaskan residents. Hap Ryder Riverfront Theater, various times. fairbanksdrama.org

25-27

7-13

GirdWOOd 11-13

Spring Carnival

Spring Carnival weekend festivities include a tug-of-war, Dummy Downhill, live music, and Alyeska’s biggest event, Slush Cup. Alyeska Resort, various times. alyeskaresort.com

JUneAU 5

Travel Fair

It’s time to start thinking about what to do with the guests that will be arriving this

Alaska Business Monthly | April 2014

Alaska Folk Festival

This is the largest annual gathering of musicians from Alaska (and beyond) for a week of performances, workshops, and dances at various venues. All evening concerts are free and open to the public at Centennial Hall. Various locations and times. akfolkfest.org

PALMer 19-20

Palmer Gun Show

This event is hosted by Alaska Gun Collectors Association of Alaska; its mission is to provide, encourage, and support a direct and continuing means for the collection, trade, sale and display of firearms and other associated items of historical and current interest. No loaded guns are allowed in the show, and all federal, state, and local firearm ordinances and laws must be obeyed. Palmer State Fairgrounds, 10 a.m. to 5 p.m. gunshowtrader.com

PetersBUrG 27

Blessing of the Fleet

The annual blessing of Petersburg’s fishing fleet is sponsored by the Sons of Norway Lodge. Coffee and pastries are served after with visiting and stories about the various boats and old time fishermen and women. Open to the community and broadcast over the radio. Fisherman Memorial Park. petersburg.org

vALdeZ 18-20

Mountain Main Hill Climb

In this event, sponsored by the Valdez Snow Machine Club, participants race snowmachines uphill. The City of Valdez contributes approximately $10,000 in prices, and some sponsors provide additional funds. Thompson Pass, races start 11 a.m. valdezsnowmachineclub.com

WAsiLLA

Fairbanks Outdoor Show

This combined outdoor and gun show includes more than 180 vendors showcasing the best of hunting, fishing, camping, outdoor sports and activities, safety gear, ATVs, boats, trailers, hunting and fishing guides, and travel destinations. Admission is five dollars. There are free informational seminars all weekend long. Carlson Center; 2 p.m. to 7 p.m. Friday, 10 a.m. to 6 p.m. Saturday, 11 a.m. to 5 p.m. Sunday. carlson-center.com

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summer. This annual event run by the Juneau Convention and Visitors Bureau is an opportunity to see what is new and is a reminder of all fabulous things there are to do with friends and family. Nugget Mall, 10 a.m. to 2 p.m. nuggetmalljuneau.com

26-27

Today’s Woman Show

Get inspired, feel refreshed, and uncover the secrets to living well, feeling healthy, and having fun. The Today’s Woman Show returns for its sixth year, jam-packed with cool jewelry and handbags, make-up tips and tricks, delicious gourmet treats, and more. Besides the incredible shopping, attendees will enjoy runway fashion shows, cooking classes, fine arts and crafts, health screenings, and everything for wedding preparation. Menard Sports Center; 10 a.m. to 6 p.m. Saturday, 10 a.m. to 5 p.m. Sunday. dammstraightproductions.com

WrAnGeLL 24-26

Stikine River Birding Festival

Thousands of birds congregate each spring to feed on the plentiful fish known as “hooligan,” including thousands of bald eagles. The city of Wrangell hosts this festival sponsored by the US Forest Service that includes activities and seminars open to the community. Various locations and times. wrangell.com/birdingfestival

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What’s Next May in Alaska Business Monthly OIL & GAS SPECIAL SECTION ■ The Alaska LNG Project: In-depth report. ■ PLUS: Statewide Oil & Gas Industry Coverage. ■ Annual Oil & Gas Directory

FEATURE ARTICLES

■ Construction: New and improved airport runway projects in rural Alaska. ■ Construction: Project line-up of what’s underway or soon to be. ■ Environmental Services: Hazmat: North Pole water & wastewater. ■ Entrepreneurs: Lemonade Day: Incubator for Alaska’s youngest business leaders.

■ Financial Services: Industrial Lending: Banking on economic development. ■ Fisheries: Halibut Rules. What the new ones mean. ■ Fisheries: Alaska’s showing at international Seafood Expo. ■ Health & Medicine: Occupational Health Services: Meeting employer needs. ■ Insurance: Lowering Workers’ Comp Costs: Tips & Trends. ■ Telecom & Tech: Worksite Options in the Alaska oil patch. ■ Transportation: Ports & Harbors: Current inventory and present needs.

DEPARTMENTS

■ From the Editor ■ View from the Top ■ HR Matters ■ Right Moves ■ Inside Alaska Business ■ Agenda ■ Alaska Trends ■ Alaska This Month Dining Travel Entertainment Events Calendar

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eCOnOMiC deveLOPMent

New Business Enterprise Institute at University of Alaska Anchorage Seeing more effective statewide engagement with business community By Nolan Klouda

he Alaska business community will soon receive new and improved support from the state’s university system. University of Alaska leadership recently announced the creation of the Business Enterprise Institute (BEI), a new University of Alaska Anchorage (UAA) unit that will place nearly all of the system’s business and economic development programs under one roof. The institute will be located at UAA’s Bragaw Office Complex at 1901 Bragaw Road in Anchorage. The mission of the BEI is to develop and diversify the economy of Alaska. In addition, the BEI will improve coordination, collaboration, and innovation of services available to Alaska’s business community. The institute is well-positioned to address the needs of Alaska businesses—large and small. The BEI brings together the Alaska Small Business Development Center (SBDC), the UA Center for Economic Development (UACED), and their constituent programs. Christi Bell, previously the ex- Bell ecutive director of the Center for Economic Development, has been named Associate Vice Provost and Executive Director of the BEI. “With the formation of the Business Enterprise Institute, UAA is placing itself firmly on the road to greater engagement with state industry,” Provost Elisha “Bear” Baker states. “This new unit combines an incredible depth of expertise and will improve on service coordination and administrative efficiency. The message to businesses and economic development organizations is clear: the University is ready to have a more productive partnership with industry, support development that sustains Alaska’s communities and economic growth, and better serve the people of Alaska to grow and diversify the state’s economy.”

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Alaska Business Monthly | April 2014

Providing a Platform Bell believes the BEI will provide a platform for high-level consultancy between industry and the university and will serve as a one-stop bridge to the wealth of expertise and talent across the entire University of Alaska system. Bell states she is “excited to lead a dynamic team of professionals that together represent a full suite of services capable of supporting the growth of innovative strategies across Alaska.” The united entities all share complimentary attributes that will allow for greater organizational synergies and better service to clients. These programs include the following: UA Center for Economic Development: The UACED’s mission has been to leverage university expertise to support economic development efforts across the state, specifically in rural and economically distressed communities. The UACED accomplishes this by providing technical assistance to municipal and tribal governments, as well as Alaska Native Corporations and economic development organizations. Alaska Small Business Development Center: The Alaska SBDC supports the state’s small business community by providing one-on-one business counseling for entrepreneurs. The SBDC also offers classes, seminars, and workshops aimed at improving entrepreneurial capacity and skills training. Professional and Executive Development: The formation of the new BEI will also include a newly developed division that will focus exclusively on professional development offerings including Executive Education, aimed at senior level managers, as well as courses supporting professionals in their transition to executive management. In addition, courses addressing common organization challenges will also

be offered on topics ranging from current human resource issues to front-line staff training. Professional development courses will be available in both open enrollment and customized formats. Supporting Programs: The new entity also unites under one roof other economic development related programs such as Lemonade Day Alaska, a youth entrepreneurship program; the Cooperative Development Program, which provides technical assistance to cooperatives; the Procurement Technical Assistance Center aimed at supporting firms engaging in government contracting; the Minority Business Development Center assisting Native businesses in accessing contracts, capital, and strategic management; AKSourceLink.com, a web portal for entrepreneurs; and BUYAlaska.com, a web portal encouraging in-state purchase of goods and services as well as other programs related to economic development. The BEI may ultimately host additional business and economic development programs. The formation of this new entity will usher in a new era for economic development in Alaska, one in which the university and its programs are better aligned to serve Alaska’s business community, both large and small. The future for economic development in Alaska is bright, and the formation of the new Business Enterprise Institute is a clear message that the university is not only committed to a stronger coordination of business and economic development services, but also serving as a far more engaged “goto” business and economic development partner moving forward.  Nolan Klouda is the Associate Director at the Center for Economic Development. Born and raised in Anchorage, Klouda has been involved with the Center since 2010. www.akbizmag.com

ALASKA TRENDS

By Amy Miller

Alaska’s State-Chartered and Federally Chartered Banks

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

Total Assets (3Q 2013)

Total Liabilities (3Q 2013)

laska is home to four state-chartered banks—Denali State Bank, First Bank, Mt. McKinley Bank, and Northrim Bank—and three federally chartered banks—First National Bank Alaska, KeyBank, and Wells Fargo Bank. What’s the difference between state and federally chartered banks? The short answer is that the charter holder is the supervisor of the bank. In Alaska, state-chartered banks are supervised by the State of Alaska, while the Office of the Comptroller of the Currency (part of the US Treasury Department) supervises federally chartered banks. Bank founders choose between state and federal charters at start up. Alaska only has one federally chartered bank that is headquartered in Alaska—First National Bank Alaska. The other two federally chartered banks that operate in Alaska, Wells Fargo and KeyBank, do not produce Alaska-specific balance sheet information. In an effort to make the banking data included in the Alaska Trends section of Alaska Business Monthly (page 169) more accurate, starting this month, figures will include the financial results of statechartered Alaska banks as well as the one federally chartered Alaska bank for which data is available on the state level, First National Bank Alaska. It is easy to see the relative size of state-chartered banks as compared to federally chartered banks in Alaska. All of Alaska’s state-chartered banks combined reported $2,294,350,000 in total assets and $2,011,970,000 in total liabilities during the third quarter of 2013. First National

■ Alaska State Banks ■ Alaska Federal Bank

Bank Alaska reported $3,137,920,000 in total assets and $2,685,500,000 in total liabilities for the same period. On a practical level, there are a variety of differences in the laws that govern state and federal banks related to the bank’s powers, capital requirements, and lending limits. These differences were once considerably more pronounced, but as banks nationwide have consolidated, the differences have become fewer and less significant. Today, one of the biggest differences between state and federal bank charters is the amount the banks pay to their respective supervisors. The regulation banks receive costs money, after all, and fees are generally higher for national banks than for state banks. Statements of Alaska’s thirteen federal credit unions and one state credit union are difficult to compare to bank statements because they are produced on an annual basis rather than a quarterly basis, and thus are not included. 

ALASKA TRENDS HAS BEEN BROUGHT TO YOU THIS MONTH COURTESY OF AMERICAN MARINE/PENCO AMERICAN MARINE • Marine Construction/Dredging • Subsea Cable Installation & Maintenance • Commercial Diving • Platform & Pipeline Construction, Installation, Repair & Decommissioning • Underwater Certified Welding • Marine Salvage • NDT Services • ROV Services • Vessel Support Services PENCO • Environmental Response/Containment • Site Support Technicians/Maintenance • Waste Management/Environmental Monitoring • Tank Cleaning/Inspection • Petroleum Facility Maintenance & Repair • Logistics Support • 24-Hour Response

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(907) 562-5420

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167

ALASKA TRENDS

Indicator

GENERAL Personal Income—Alaska Personal Income—United States Consumer Prices—Anchorage Consumer Prices—United States Bankruptcies Alaska Total Anchorage Total Fairbanks Total EMPLOYMENT Alaska Anchorage & Mat-Su Fairbanks Southeast Gulf Coast Sectorial Distribution—Alaska Total Nonfarm Goods Producing Services Providing Mining and Logging Mining Oil & Gas Construction Manufacturing Seafood Processing Trade/Transportation/Utilities Wholesale Trade Retail Trade Food & Beverage Stores General Merchandise Stores Trans/Warehouse/Utilities Air Transportation Information Telecommunications Financial Activities Professional & Business Svcs Educational & Health Services Health Care Leisure & Hospitality Accommodation Food Svcs & Drinking Places Other Services Government Federal Government State Government State Education Local Government Local Education Tribal Government Labor Force Alaska Anchorage & Mat-Su Fairbanks Southeast Gulf Coast Unemployment Rate Alaska Anchorage & Mat-Su Fairbanks 168

By Amy Miller Previous Report Period (revised)

Year Ago Period

Year Over Year Change

Units

Period

Latest Report Period

US $ US $ 1982-1984 = 100 1982-1984 = 100

3rdQ13 3rdQ13 2nd H13 2nd H13

36,923 14,180,492 213.91 233.55

36,557 14,032,587 210.85 232.37

36,123 13,683,809 206.61 230.34

2.21% 3.63% 3.53% 1.39%

Number Filed Number Filed Number Filed

December December December

28 10 2

35 20 4

30 26 3

-6.67% -61.54% -33.33%

Thousands Thousands Thousands Thousands Thousands

December December December December December

333.10 177.00 39.20 33.85 28.60

331.50 177.60 39.00 34.40 29.20

335.40 177.70 39.00 34.20 28.15

-0.69% -0.39% 0.51% -1.02% 1.60%

Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands Thousands

December December December December December December December December December December December December December December December December December December December December December December December December December December December December December December December December December

317.4 38.9 278.5 18.2 17.6 15.0 15.9 4.8 1.3 61.7 5.6 36.0 6.3 9.5 20.1 5.6 6.1 4.0 13.1 27.1 47.4 33.7 28.2 5.7 18.6 11.4 83.5 14.3 26.2 8.6 43.0 24.2 3.4

320.6 41.6 279.0 18.2 17.6 14.7 16.7 6.7 2.9 61.5 5.6 35.7 6.2 9.5 20.2 5.6 6.1 4.0 13.2 27.7 47.3 33.6 28.0 5.6 18.7 11.7 83.5 14.1 26.3 8.7 43.1 24.1 3.3

319.2 37.8 281.4 17.2 16.8 13.7 15.2 5.4 1.7 62.8 6.0 35.9 6.2 10.2 20.9 5.6 6.1 4.0 13.0 27.3 47.2 33.4 28.6 6.7 18.0 11.5 84.9 15.5 26.5 8.6 42.9 24.4 3.5

-0.56% 2.91% -1.03% 5.81% 4.76% 9.49% 4.61% -11.11% -23.53% -1.75% -6.67% 0.28% 1.61% -6.86% -3.83% 0.00% 0.00% 0.00% 0.77% -0.73% 0.42% 0.90% -1.40% -14.93% 3.33% -0.87% -1.65% -7.74% -1.13% 0.00% 0.23% -0.82% -2.86%

Thousands Thousands Thousands Thousands Thousands

December December December December December

362.58 203.08 46.86 37.47 37.83

363.52 202.96 46.73 37.76 38.09

363.05 203.76 46.92 37.44 37.38

-0.13% -0.33% -0.13% 0.08% 1.20%

Percent Percent Percent

December December December

6.5 5.2 5.4

6.2 5.1 5.3

7 5.6 6.1

-7.14% -7.14% -11.48%

Alaska Business Monthly | April 2014

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ALASKA TRENDS

By Amy Miller Previous Report Period (revised)

Year Ago Period

Year Over Year Change

Units

Period

Latest Report Period

Percent Percent Percent

December December December

7.2 8.4 6.5

6.6 7.6 6.6

7.4 9 7.6

-2.70% -6.67% -14.47%

Millions of Barrels Billions of Cubic Ft. $ per Barrel

December December December

16.92 8.12 108.19

16.07 7.51 101.28

17.25 9.38 107.31

-1.91% -13.43% 0.82%

Active Rigs Active Rigs $ Per Troy Oz. $ Per Troy Oz. Per Pound

December December December December December

9 1771 1225.40 19.61 0.95

9 1756 1275.82 20.76 0.96

7 1784 1688.53 31.96 0.93

28.57% -0.73% -27.43% -38.64% 2.15%

Millions of $ Millions of $ Millions of $

December December December

41.78 5.35 36.43

29.71 10.57 19.14

29.21 3.96 25.25

43.03% 35.10% 44.28%

Total Deeds Total Deeds

December December

655 186

682 150

1246*Geo North 335

-47.43% -44.48%

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

Thousands Thousands

December December

362.93 77.18

320.58 65.64

347.67 71.05

4.39% 8.63%

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 $

December December December December December December December

49,241.9 49,882.4 357.9 408.8 -57.3 -10.5 276.0

48,770.1 49,396 215.5 439.9 -58.4 26.5 270.6

43,654.8 44,275.1 364.9 603.7 -11.2 8.3 399.9

12.80% 12.66% -1.92% -32.28% 411.61% -226.51% -30.98%

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 $

3rdQ13 3rdQ13 3rdQ13 3rdQ13 3rdQ13 3rdQ13 3rdQ13 3rdQ13 3rdQ13

5,432.27 281.86 1,666.44 2,478.91 17.22 4,697.47 4,086.89 1,693.48 2,393.41

5,126.68 155.80 1,585.38 2,463.10 20.09 4,398.85 3,833.54 1,542.93 2,290.61

5,196.30 183.80 1,706.22 2,388.19 22.44 4,464.78 3,930.32 1,614.76 2,315.56

4.54% 53.35% -2.33% 3.80% -23.26% 5.21% 3.98% 4.88% 3.36%

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

December December December December December

103.47 1.06 0.61 0.73 6.12

100.21 1.05 0.62 0.74 6.13

83.66 0.99 0.62 0.76 6.29

23.68% 7.07% -1.61% -3.95% -2.70%

Indicator

Southeast Gulf Coast United States PETROLEUM/MINING Crude Oil Production—Alaska Natural Gas Field Production—Alaska ANS West Coast Average Spot Price Hughes Rig Count Alaska United States Gold Prices Silver Prices Zinc Prices REAL ESTATE Anchorage Building Permit Valuations Total Residential Commercial Deeds of Trust Recorded Anchorage--Recording District Fairbanks--Recording District

Notes: 1. Source of Anchorage Deeds of trust (GeoNorth) is cited in the data field. 2.Fourth Quarter banking data is not available at this time. 3. Banking data has been updated to include Alaska state banks and Alaska’s sole federally chartered, Alaska-based bank, First National Bank Alaska. www.akbizmag.com

April 2014 | Alaska Business Monthly

169

Advertisers Index Ahtna Inc.............................................................113 Alaska Air Cargo..........................................103 Alaska Dreams Inc.........................................52 Alaska Executive Search (AES)...........145 Alaska GSHC 2014........................................ 21 Alaska Park..........................................................11 Alaska Rubber .................................................86 Alaska Traffic Co.........................................108 Alaska USA Federal Credit Union.......29 Aleut Corp.........................................................153 Alyeska Resort..................................................61 American Fast Freight................................171 American Marine/PENCO.....................167 Anchorage Opera.........................................163 Architects Alaska............................................35 Arctic Branding & Apparel....................... 41 Arctic Controls............................................ 100 Arctic Office Products (Machines)....131 AT&T .......................................................................71 Avis........................................................................ 161 BDO..........................................................................15 Beacon OHSS....................................................32 Black Gold Oilfield Services ...................53 Bowhead Transport Co...........................105 BP Exploration (Alaska).............................23 Brand Energy & Infrastructure.............87 Bristol Bay Native Corporation............79 Calista Corp./Solstice Advertising...139 Carlile Transportation Systems......... 149

170

CCI Industrial....................................................89 Chris Arend Photography......................170 Chugach Alaska Corp.................................. 77 Ciri Alaska Tourism....................................... 57 Clarion Suites | Quality Suites . ..........163 Colonial Life......................................................111 Construction Machinery Industrial LLC................................................2 Cornerstone Advisors..................................19 Crowley..............................................................101 Cruz Construction Inc................................85 Denali General Contractors.................129 Dinoâ&#x20AC;&#x2122;s Donuts Inc.........................................165 Donlin Gold.......................................................151 Dowland-Bach Corp....................................93 Doyon Remote Facilities & Services.. 49 EDC Inc.................................................................54 eDocsAlaska Inc.............................................47 Fairbanks Convention & Visitors Bureau....................................68 Fairweather LLC..............................................31 First National Bank Alaska..........................5 Fountainhead Hotels...................................59 Futaris...................................................................117 GCI . .............................................................93, 172 Great Originals Inc.......................................151 Hawk Consultants LLC............................... 91 Historic Anchorage Hotel....................... 161 Horizon Lines..................................................121

Alaska Business Monthly | April 2014

Hotel Captain Cook......................................27 Island Air Express....................................... 162 JENNMAR...........................................................38 Judy Patrick Photography.......................80 Junior Achievement...................................127 Kakivik Asset Management....................99 Kinross Ft. Knox..............................................45 Kodiak Inn Best Western..........................59 KPB Architects................................................25 Lifewater Engineering Co.........................54 Little Red Services Inc................................83 Lynden Inc. ..........................................106, 115 MagTec Alaska LLC....................................... 91 MTA Communications................................74 N C Machinery.................................................43 North Slope Telecom Inc...................... 100 North Star Behavioral Health.................33 Northern Air Cargo.........................156, 157 Northrim Bank............................................... 137 Northwest Strategies...................................51 NTCL . ................................................................108 Offshore Systems Inc..................................97 Oxford Assaying & Refining Inc........164 Pacific Alaska Freightways.......................55 Pacific Pile & Marine.......... 158, 159, 160 Pacific Rim Media/ Smart Phone Creative...........................35 Paramount Supply.......................................165 Parker, Smith & Feek.....................................13

Pen Air.................................................................119 Personnel Plus............................................... 162 Ravn ALASKA...................................................17 Remote Access Technology (RAT) Intl.......................................................39 Renewable Energy Alaska Project......81 Scan Office........................................................50 Seekins Ford Lincoln Fleet.......................95 Seward Chamber & CVB..........................60 Span Alaska Consolidators..................104 Spenard Builders Supply . ......................123 State of Alaska TPC/Smoke Free Workplace..................................................155 Stellar Designs Inc.......................................165 STG Inc..................................................................78 Totem Ocean Trailer Express (TOTE)......................................................... 109 Trailercraft Inc. Freightliner of Alaska.....................................................107 Tulalip Casino Resort...................................65 Ukpeagvik Inupiat Corp...........................125 United Way of Anchorage......................147 US Travel..............................................................64 Usibelli Coal Mine Inc................................139 Verizon ..................................................................73 Visit Anchorage...............................................63 Washington Crane & Hoist.......................37 Westmark Hotels - HAP Alaska........... 57 XTO Energy .........................................................3

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