2001 Construction Roundup.
Employment calls for heavy equipment operators--needed to work on North Slope oil field projects during the abbreviated winter work season-kept rolling in at the Operating Engineers Local 302 union hall in Fairbanks.
By early March, all of the union hands requested by name were already dispatched and the contractors still needed more workers, said Don Lowry, business agent with the union.
"We had a dozen open calls," he said, surprised by the amount of work that swamped the union hall.
Even more notable-this high level of employment occurred during the winter months, a time when construction work opportunities in Alaska are typically few and far between.
In addition to labor managers, Alaska's contractors are also noticing the increase in construction work this year, particularly during the winter season.
"It was a pretty busy season this winter," said Dave Matthews, general manager for H.C. Price, which landed an oil field contract to build 3.5 miles of pipelines connecting a second drill pad to the existing Alpine infrastructure.
"We were kind of on a bubble there with the ongoing mergers, and all of these projects piled up on top of each other," he said.
Now, both Phillips Petroleum Co. and BP Exploration (Alaska) Inc. are going great guns with their North Slope holdings. Combined, the two companies expect to spend about $1.6 billion on capital projects in Alaska in 2001, an increase from past years.
"There's a pretty big increase in the number of (construction work) man-hours occurring this year," said Ronnie Chappell, spokesman for BP Exploration. "It's bigger than I had expected."
Alaska's oil industry, which drives the state's economy, isn't the only sector that's bumping up spending for construction and capital improvements. Large retail companies such as Wal-Mart and Home Depot have announced plans to construct and open new stores in Alaska.
Values on building permits for private and commercial construction is sued in the state's two largest cities continue to maintain strong levels, increasing in Anchorage by nearly 70 percent during the first few weeks of the year, compared to the same period in 2000.
And public-sector spending planned for 2001 appears to be "significantly" stronger than recent past years, said Dick Cattanach, executive director of the Associated General Contractors of Alaska.
"The current projection I have for public spending is $1.6 billion," he said. "We expect it will be a real good year."
Also different from past years is that more construction work was being completed during winter months. Except for North Slope oil field contractors who are required to work on the frozen coastal plains during winter, other types of construction in Alaska typically slows or stops during the state's notorious cold season.
"From what I'm hearing from my con tractors, this winter they didn't have the down time that they've had in prior years," said Eden Larson, executive director of the Associated Builders and Contractors of Alaska. "The work continued through ... they were finding ways to work through the winter.
"It's challenging because it's different. It's challenging not to have that down time, and it's presenting management level challenges," she added.
Oil and Gas Industry
The bulk of construction spending in Alaska's oil and gas industry goes to cover exploration and development of oil and gas fields located on the North Slope.
BP Exploration and Phillips Petroleum are the two major players on Alaska's North Slope-their construction spending trends not only reflect development of the state's remote northern region, but also contribute heavily to the overall health of the state's oil-based economy.
And 2001 should be a banner year for construction workers and contractors serving the oil and gas industry. BP Exploration plans to spend about $800 million this year on capital projects, up from about $700 million in 2000, said Spokesman Ronnie Chappell.
That includes employment this year for about 550 people working on the Northstar project, with the bulk of that work occurring in Anchorage as crews complete fabrication of 3,500-ton modules at the Port of Anchorage.
A couple hundred people have been employed continuously for about two years on module fabrication in Anchorage, Chappell said.
Also significant is BP's investment of about $100 million this year for further development of satellite fields on the western edge of the Prudhoe Bay unit. About 400 people spent the first few months of 2001 working on this expansion project, Chappell said. Construction work will continue over the next several years.
"This is the first infrastructure development in the Prudhoe Bay unit in many years," he said. "Including drilling work, we'll spend about $1 billion on this during the next four to five years."
BP Exploration also will spend $86 million this year on construction of a gas-to-liquids plant at Nikiski. Employment on that project should peak at 200 people later this year, Chappell said.
In all, the amount of North Slope construction employment created by BP Exploration will double this year, compared to 2000, Chappell said. "We'll have a half-million craft man-hours," he said. "With the off-site fabrication and insulation work, we'll have another 200,000 hours."
Construction workers earn some of the highest wages in the state. State labor statistics show that the average weekly earnings of construction workers are more than $1,000.
Phillips Petroleum is also contributing greatly to the construction industry in 2001. The company has budgeted $775 million for capital projects in Alaska this year, said Spokeswoman Dawn Patience. That's an increase of $50 million from 2000 and more than $100 million increase from 1999.
The company expects to spend even more in 2002-about $810 million. Also, the annual capital budget for 2001 and 2002 includes about $200 million for construction of new tankers to transport North Slope crude.
Construction at Meltwater, a joint venture between Phillips and BP, will provide employment for about 500 workers this season. A satellite of the Kuparuk field, Meltwater involves construction of pipelines and a drill pad, which will tap the 50-million-barrel field starting at the end of the year, Patience said.
Houston Contracting Co. won the bid to build the pipelines connecting Meltwater with existing North Slope infrastructure. "It's a total of 60 miles of pipelines-eight inch, 12-inch and 24-inch lines," said Randy Wood, Fairbanks division manager for Houston. "We peaked at about 475 employees on the North Slope."
Phillips is also extending the size of the Alpine oil field with a second drill platform.
Corps of Engineers Projects
Federal funding through the Army Corps of Engineers for the fiscal year 2001 should be $332 million in the Alaska District. That capital spending should increase to $563 million for fiscal year 2002, according to Spokeswoman Patricia Richardson.
One of the biggest projects planned by the Corps of Engineers--the $130 million replacement for Bassett Army Community Hospital--has been put on hold because contractors' bids to build the 250,000-square-foot structure surpassed the estimated budget.
In addition, the Corps of Engineers will spend more than $42 million on construction projects at Fort Wainwright during the next four years.
Crews working for Nuna Contractors Inc. have started construction of a 3,220-square-foot ammunition surveillance building. The $2.2 million facility should be completed by November 2001, according to Richardson.
American Mechanical Inc. won a $14.6 million contract to design and build a training facility at the Fairbanks base. The project, which consists of 17 buildings that simulate an urban setting for combat training, are called the Military Operations in Urbanized Terrain (MOUT) Collective Training Facility. The estimated completion date is November 2002.
Nearly $26 million will be spent to upgrade the central heat and power plant at Fort Wainwright under a contract awarded to Alaska Mechanical Inc. That repair project should be completed in August 2004, according to Richardson.
Other construction projects in Alaska which have been awarded by the Corps of Engineers include repairs to fuel storage tanks at Cape Romanzof. Haskell Corp. of Bellingham, Wash. won the contract award for that $3.7 million job. Watterson Construction of Anchorage was selected by the Corps to build new dorms for enlisted personnel at Eielson Air Force Base near Fairbanks, a $12.4 million project.
Watterson also will build new enlisted personnel dorms at Fort Richardson and at Elmendorf Air Force Base, both in Anchorage. The Army barracks will include a soldier community center in its $10.2 million price tag. The Air Force facility, scheduled to be completed in May 2002, will cost an estimated $13.6 million.
Roads on Elmendorf also will be improved under a $9 million contract awarded to Goodfellow Bros. in Anchorage. Crews are scheduled to resume work this summer on improvements to Vandenburg Avenue and Provider Drive, work that started last fall.
More than $10 million will be spent to improve the harbor at St. Paul under a contract awarded to Kelly-Ryan of Seattle, Wash., a project scheduled to be completed in July.
Alaska Railroad Projects
More than $100 million is planned for improvements to the state-owned rail system, with the bulk of that construction money coming from the Federal Railroad Administration.
Construction is scheduled to start this summer on a three-year, $47 million project to improve track used by the Alaska Railroad from the north end of the Anchorage Rail Yard to the Eagle River Bridge, according to information provided by Spokesman Scott Banks. Work on the 10-mile section of track should be completed in the fall of 2003.
Additional track improvements are scheduled for track stretching between Eagle River and Wasilla. The $18 million budget, funded by the Federal Transit Administration with Alaska Railroad matching funds, covers costs to straighten 44 curves in the 32-mile stretch of track. The project, after completion in the fall of 2003, will reduce travel time between Anchorage and Wasilla by 36 minutes.
Construction is scheduled to begin this year on a $7 million project that will add approximately five miles of new mainline track between Klatt Road and International Airport Road in Anchorage. The project, funded mostly by the Federal Transit Administration with a local match from the Alaska Railroad, is designed to increase safety and efficiency of the train system.
Most of the heavy construction work for a new freight dock in Seward has been completed, with related resurfacing work scheduled this year. The $6.3 million project, which began last fall, involves constructing a new freight dock and overhauling the existing structure as a passenger-only facility.
Finally, the railroad has started work to build a new station at the Ted Stevens Anchorage International Airport. The station will be located north of the existing parking garage. The 17,300-square foot terminal will provide a passenger assembly area, offices and lease space and an underground pedestrian tunnel connecting with the airport's newly constructed concourse.
Construction of the new rail station should be completed in the fall of 2002. The $28 million project is funded by the Federal Railroad Administration.
Ted Stevens Anchorage International Airport
The planned railroad terminal construction at Alaska's largest commercial airport is only a part of ongoing renovations at the Ted Stevens Anchorage International Airport.
Probably the largest single construction job planned is the terminal redevelopment project, which is slated for completion in the spring of 2003, according to Dave Eberle, central region director of the state Department of Transportation.
Despite permitting hold-ups early in 2001, work continued on the $230 mil lion project. Eberle said that project managers were continuing to work with permitting authorities to obtain proper approvals for the facility. Selection of an $80 million construction contract for part of the facility is scheduled to be announced in August, he added.
In addition to the terminal redevelopment project, Anchorage airport authorities are managing more than 140 active construction projects this year, said Chris Birch, manager of engineering, facilities and environment.
The largest among those projects is the new north-south taxiway, estimated to cost about $30 million. Crews will build about two miles of asphalt taxiway this summer.
"This taxiway will improve access to the airport's only north-south runway by enabling aircraft access to the west," Birch said. "The growth in the North Air Park area by FedEx, UPS and Williams/Lynx will benefit with the completion of this project."
Construction projects planned at Anchorage International for the next five years will average about $60 million a year, Birch added.
The state Department of Transportation plans to spend nearly $375 million this fiscal year on construction projects. That overall spending should go up to $390 million in the fiscal years 2002 and 2003, according to the recently approved DOT construction plan.
Road improvements top the spending list this year, with nearly $136 million slated for improvements. Those include $12.7 million for rehabilitation and paving on the Elliott Highway north of Fairbanks from mile 28 to 72.
The Parks Highway also will receive substantial improvements with a number of road projects. More than $41 million will be spent on road rehabilitation and reconstruction.
The Tok cutoff road between mile 30 and 38 also will receive $12.4 million worth of road reconstruction work under this year's spending plan.
DOT will spend more than $72 million for community transportation program construction, including $14 million for statewide road surface treatments.
More than $15 million will be spent this year on 21 different projects included in the Trails and Recreational Access for Alaska program (TRAAK).
Almost $88 million is planned for improvements to the state-owned Alaska Marine Highway System, including $6.3 million for the second phase of improvements to the Ketchikan Transfer Facilities. About $38 million is slated for purchase of a new "fast ferry" shuttle to make daily runs between Sitka and Juneau, and $37 million is slated for purchase of a new ferry for Prince William Sound.
Finally, DOT plans to spend about $40 million for the Anchorage Metropolitan Planning Area construction. Those projects include C Street reconstruction from International Airport Road to Dimond Boulevard and reconstruction of Dowling Road from Lake Otis Parkway to the Old Seward Highway.
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|Publication:||Alaska Business Monthly|
|Article Type:||Statistical Data Included|
|Date:||May 1, 2001|
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