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Inside Alaska industry: facts and figures from around the state.


Coal Contract Signed. A new three-year contract selling Usibelli steam coal to the Korean Electric Power Co. started up Oct. 29, sending sighs of relief throughout Alaska.

The contract, in effect since 1984, has moved between 640,000 and 700,000 tons of coal annually from Usibelli Coal Mine in Healy to the Korean market, the only export outlet for the Alaska mineral.

To keep Alaska coal competitive on the world market, the Alaska Railroad has hauled the coal from Healy to Seward at a loss for the last two years. From Seward, Suneel Alaska Corp. has shipped the coal to Korea.

Trouble began brewing this fall when the coal contract came up for renewal on Oct. 31. Bucking low coal prices on the world market, Suneel asked for a $3.27-per-metric ton decrease for the Alaska coal. Suneel and Usibelli agreed to absorb the expense of the decrease, hoping the railroad would keep its transportation prices the same to make the contract work.

The Alaska Railroad refused, estimating that its coal haulage rates should increase from $8.62 per metric ton to between $9.13 and $9.50 a ton to cover the cost of transporting the coal. On Sept. 30, citing the fact that Suneel owed $1.4 million in transportation charges, the Alaska Railroad stopped hauling the Healy coal and laid off 15 employees.

If a new contract agreement failed to come through, Usibelli officials announced that up to 40 of their 120 employees could lose their jobs. Suneel faced terminating 14 employees at its Seward facilities.

In a last-minute agreement, Suneel and Usibelli kept their promise to take on the $3.27 cut per ton of coal, and the railroad consented to hold shipping charges to $9.13 per metric ton.

Other mining news nuggets:

* The defunct Windy Craggy copper mine proposal in British Columbia may have new life. Though the B.C. government declared the 2.3-million-acre site a wilderness area in late summer, Chaimpagne and Aishihik First Nation Indians have filed a Native land claim on the site. If it turns out the Natives own the land, negotiations could reopen for the Windy Craggy mine.


PACFISH Put Off. A PACFISH policy, developed by the Bureau of Land Management and U.S. Fish & Wildlife Service to increase "no-harvest" zones around fish streams, may not take hold in the Tongass National Forest this year.

Alaska Sen. Ted Stevens announced that he received commitment from a joint legislative committee that current stream protection in the Tongass would be studied and an interim report issued by April 1994.

The PACFISH approach was instituted to reverse declining fish stocks in Washington, Oregon, Idaho and California. The Tongass is currently the only national forest in the country with buffers mandated by law. According to Stevens, implementing PACFISH in Alaska would place excessive buffer zones around 2,500 streams, leaving no timber available for harvest.

Another timber chip:

* Plans for large-scale logging in the Tanana Valley State Forest are on hold so that the Alaska Department of Natural Resources can inventory the timber. Despite fierce opposition from Interior residents, the state wants to triple logging rates in the forest and offer more than 80,000 acres to logging during the next 10 to 20 years.


Thumbs Up for MarkAir Express. A decision from a federal bankruptcy judge cleared the hurdle for the $11 million sale of MarkAir Express to Robert Beauchamp, a California dentist, in November.

A subsidiary of Anchorage-based MarkAir Inc., MarkAir Express serves more than 100 communities throughout Alaska. Unsecured creditors, owed $2 million by the parent company, are in line to be repaid as part of MarkAir Inc.'s bankruptcy court reorganization plan.

Other transportation trends:

* Alaska Air Group Inc., owner of Alaska Airlines, reported a profitable quarter, the first in two years. The company's earnings for the third quarter of 1993 stood at $8 million, compared to a loss of $2 million for the same period a year ago.

* High price tags could sink two proposed boat harbors in southeast Alaska. A marina in downtown Juneau, originally estimated at $6 million, now is quoted to cost $9.2 million to $12.4 million. Likewise, a proposed boat harbor in Saxman, near Ketchikan, is expected to cost $1.1 million, an extravagant price for a port expected to produce only $300,000 in benefits.

* The Alaska Marine Highway System will eliminate a second weekly ship traveling from Bellingham, Wash., to Alaska next summer in order to provide more service to ports in southeast Alaska. Deployed two years ago for a run, the second weekly ship has failed to fill up each summer. At the same time, Southeast residents reported they wanted increased ferry service to relieve bottlenecks that occur at Southeast ports every summer.


Stalking Endangered Salmon. How much responsibility do Alaska fishermen have for declining salmon runs in the Pacific Northwest?

Already, summer king salmon fishing in southeast Alaska has been curtailed for five days each July to save an endangered chinook run on the Snake River. The move would save an estimated 62 Snake River salmon in Southeast each year.

Now the National Marine Fisheries Service is debating whether to cut back fishing for mid-Columbia River summer chinooks. An estimated 3,700 mid-Columbia summer kings are caught in Alaska each summer, 28 percent of the total coastwide harvest.

Other fishing catches:

* Record runs for statewide fisheries include good news and bad news. For the good news, a record 526,000 chum salmon, 2.39 million silver salmon, and six million pounds of black cod (sablefish) were caught in Southeast this year. Bad news: The bycatch of chum salmon caught by trawlers cruising the Bering Sea and Gulf of Alaska hit record levels this year, including 200,000 fish pulled in from the Bering Sea and 55,000 in the Gulf of Alaska -- alarming news in the light of dismal chum runs in Interior rivers.


Mapco Pushes Pipeline. Denali Pipeline Co., a subsidiary of Mapco Inc., has filed for a state right-of-way lease to build a 350-mile refined-oil pipeline from North Pole to Anchorage.

Estimated to cost between $150 million and $175 million, the pipeline would carry up to 56,000 barrels of fuel daily from North Pole refineries to storage facilities in Anchorage. The 24-inch diameter pipeline would lie 3 to 5 feet underground. Year-long construction of the pipeline could begin in 1995 or 1996 and employ up to 700 people.


Carrs Continues Conquest. As of Nov. 1, two Ketchikan grocery stores, Sea Mart and Market Place, became property of Carr Gottstein Foods Co. The Anchorage-based food conglomerate plans to merge the two facilities into one expanded store at the Sea Mart location.

Designated a Carrs Quality Center, the new building is slated for completion by the third quarter of 1994. Carrs plans to retain employees working at the two Ketchikan stores.

Other retail rampages:

* What will they think of next? Bank of America Alaska signed a letter of intent to open up to 10 branches in Carrs Quality Centers and Eagle Quality Centers statewide. The bank is a subsidiary of Bank America Corp.


Tied-Up Traffic Fuels Growth. Growing crowds in Seward have prompted the National Park Service to consider expanding its visitor facilities in the area. The agency hopes to build a new visitor center to complement crowded conditions occurring at the center located at the small boat harbor. In addition, new visitor facilities may be built at Exit Glacier, close to town.

Travelers to the information center at the boat marina have increased from 2,023 in 1986 to 47,209 in 1992. Traffic at Exit Glacier has climbed by 75 percent in the past year.

The park service hopes to have draft plans of the new expansion available to the public for comment by the summer of 1994. According to park service officials, new facility construction could lie a minimum of three years away.
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Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
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Author:Woodring, Jeannie
Publication:Alaska Business Monthly
Date:Dec 1, 1993
Previous Article:First National Bank.
Next Article:1994 - and beyond: Alaska's business leaders look to the future.

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