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Prince William Sound: southern pipeline terminus.


Alaska's Prince William Sound is an intriguing blend of tidewater glaciers, rainforests, mountains and wildlife. Geographically located off the Gulf of Alaska, it sits on the east side of the Kenai Peninsula.

Prince William Sound's largest city is Valdez, which is located at the southern terminus of the trans-Alaska oil pipeline. Other significant communities on the Sound include Cordova and Whittier, as well as the Alaska Native villages of Chenega and Tatitlek.

The bulk of the land surrounding Prince William Sound is part of the Chugach National Forest--the second-largest national forest in the country. Prince William Sound is heavily accented by the massive Chugach Mountains and several barrier islands along the coastline, including Montague Island, Hinchinbrook Island and Hawkins Island.

Early in its history, in 1778, Prince William Sound was explored by British navigator and Captain James Cook. Cook initially named it Sandwich Sound, after his patron the Earl of Sandwich; however, the editors of Cook's maps changed the name to Prince William Sound in honor of the man who would later become King William IV.

A variety of significant events have shaped Prince William Sound's history and changed its landscape throughout the years. For example, a 1964 tsunami resulting from the Good Friday Earthquake killed villagers in Chenega and virtually destroyed the original town of Valdez. And in 1989, the Exxon Valdez oil tanker bound for Long Beach, Calif., struck Prince William Sound's Bligh Reef and spilled from 260,000 to 750,000 barrels of crude oil. The spill caused massive environmental damage, killing numerous seabirds, otters, seals, bald eagles and whales. The residual effects of the spill still linger today, altering some marine species and human lives forever. The Valdez spill was the largest ever in U.S. waters until the 2010 Deepwater Horizon oil spill, in terms of volume released.



As a region, Prince William Sound's economy varies from other parts of Alaska. Many areas of the State are driven by only a few industries; Prince William Sound has more economic diversity.

"Prince William Sound is kind of a microcosm for Alaska," says Alyssa Shanks, an Alaska Department of Labor economist who specializes in the employment and wages of the Interior, Gulf Coast and Northern economic regions. "It has oil and gas, seafood and tourism. The only thing it's missing is the big military component."

Most of the Sound's residents live and work in Valdez and Cordova, making the Valdez-Cordova Census Area a prominent place within the region. According to research by the Alaska Department of Labor, the CordovaValdez Census Area's main industry in 2009 was trade, transportation and utilities. That sector employed more than 20 percent of the area's workers that year.

Other major industries for the Sound in 2009 were local and State government (28 percent); hospitality and leisure (10 percent); and education and health services (8 percent). More workers were employed as construction laborers than any other occupation in 2009. Major employers in the Valdez-Cordova Census Bureau Area include Alyeska Pipeline Service Company, the State of Alaska, the cities of Valdez and Cordova, Valdez and Cordova city schools, Trident Seafoods Corp., Copper River Native Association Inc., and University of Alaska.


The economy of Valdez is significantly more diverse than that of Cordova, where seafood is the chief industry. However, the seafood industry has a hit-or-miss aspect that creates a certain level of uncertainty for Cordova residents, according to Shanks. "Over the course of the year, it can feel like feast or famine, depending on the season," she says.

In contrast, oil is king in Valdez-supported by a variety of other sectors. In fact, one-third to half of the city's revenue can be attributed to the oil industry. The pipeline's presence in Valdez creates an unusual situation:

"There's a large contingent of people in Valdez who are there to work and sleep; then they leave," Shanks says.

Pipeline personnel frequently work two weeks on and two weeks off. When not working, they return home for rest and relaxation, taking their healthy paychecks with them. While some of their earnings are spent locally on food and other necessities, Valdez pipeline workers typically don't buy homes and other big ticket items that can have a deep impact on the local economy.

Over the years, the population--and work force--of the Valdez-Cordova Census Area have been slowly declining. The area's population declined 5.5 percent from 2000 to 2010, going from 10,195 to 9,636, according to the U.S. Census Bureau. But comparing other places to Alaska, a 5.5-percent decline seems very stable, Shanks says. However, a decrease of 559 residents is significant for a small place like Valdez.

Shanks says she doesn't know exactly what's driving the population decrease, but a shrinking population doesn't bode well--for any area.

"Population and employment tend to go together," she says. "A declining population isn't the best thing if you're looking for economic growth."

Valdez Mayor Dave Cobb has a theory about why the area's population is declining: "I think what's happening is you're looking at an older population. A lot of people work for the pipeline, and when they retire, they leave to go back to their home state."


With about 4,350 residents, Valdez is the population and activity center for Prince William Sound. Like many seasonal places, it has a large population spike in the summer during the height of the fishing and tourism seasons. Cobb, a fisheries biologist, originally from Washington state, characterizes Valdez as a great place to work and live. "I think it's the people," he says. "We have a highly educated group of people who are concerned about a lot of things. They step forward and provide some good commentary and discussion."

Cobb says Valdez's economy has gone down a bit, but the city is faring better than other parts of the State and nation. However, there is always room for improvement. "We're always looking for ways to increase jobs and have a more diverse economy," Cobb says, currently serving his third term as mayor.

As a recent positive change, Cobb has seen an increase in the value of the area's commercial fishing industry. New processors in Cordova and the revitalization of the processing plant in Valdez are just two examples.

Commercial fisheries are making a living for a change, Cobb says. Prices have been as low as 9 cents a pound, but this year the prices were in excess of 43 cents per pound.

"We've recovered in the world market, so we are getting higher prices," he said. "I think it's the great marketing by the State of Alaska. We also see local marketing here in Valdez and Cordova."

As another positive economic factor, Valdez's tourism industry is holding steady this year, according to Dave Petersen, executive director of the Valdez Convention and Visitors Bureau. With an average 60,000 visitors annually, the city hasn't had a significant reduction in visitors this year.

"Most of the bigger companies and RV parks are pretty much in line with what they've been in the past," he says. "We didn't have huge declines."

However, Valdez did lose a port of call this year from the Princess Cruises ship Connoisseur of Alaska. But the impact was only slight because Valdez relies heavily on RV and independent travelers, many of whom are long-haulers that come up from Canada and the Lower 48.

Lately, Petersen says, he has noticed an interesting trend among visitors: more people seem to have less time for vacation. Rather than drive their RV the entire trip, they fly into Anchorage and then drive the rest of the way to Valdez. "They're trying to compact their trip into a shorter stay," Petersen says.

Tourists visit Valdez for a wide variety of reasons. Many are drawn by the legendary pipeline terminal, first-class sport fishing, rugged Peter Toth Indian Head Carving, and easy access to tidewater glaciers and wildlife.

"You've got kind of this amazing mix of a small-town atmosphere and access to some of the largest mountains in North America," Petersen says. "It's heaven."

There are also unique exhibits in the Valdez Museum and Historical Archive, as well as the Maxine and Jessy Whitney Museum. Visitors can view highlights of the 1964 Earthquake and watch an engaging video entitled "Between the Glacier and the Sea."


Valdez has a number of construction projects under way to improve the city for both visitors and residents. One of the most recent projects is a new 300,000-pound cold-storage facility. The regional facility will make it easier and more cost-effective for commercial fisherman to store, process and ship their catch.

The cold-storage facility will be especially beneficial to the area's burgeoning smoked fish market. It will enable fishermen to avoid the expense of shipping their smoked fish to Anchorage.

"It's cost us about five cents a pound to ship it to Anchorage and five cents to ship it back," Cobb says. "When you're saving that much on a product that you're getting $1 a pound for, it's significant."

In addition to saving money, the facility should result in about a dozen new jobs annually, Cobb adds.

As another improvement, Valdez recently updated Kelsey Dock. Officially called the John Thomas Kelsey Municipal Dock, the city's beautiful port has been referred to as the "Switzerland of Alaska." Valdez is also in the process of looking at constructing a new junior high school.

"We continue to be progressive and meet the needs of our citizens," Cobb says.


* Population: 4,350

* Location: Approximately 300 miles from Anchorage

* Government structure: Mayor-Council form of government

* Key Contacts: Dave Cobb, mayor of Valdez; Sheri Buretta, chairman and acting CEO of Chugach Alaska Corp.; and Barney Uhart, president of Chugach Alaska Corp.

* Key Industries: Oil and gas; local and State government; trade, transportation and utilities; hospitality and leisure; and seafood

* Tax Base: Oil and property taxes

* Major Hospitah Providence Valdez Medical Center

* Airport: Valdez Pioneer Field Airport

* Port: Port of Valdez
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Title Annotation:Regional Review
Comment:Prince William Sound: southern pipeline terminus.(Regional Review)
Author:Barbour, Tracy
Publication:Alaska Business Monthly
Date:Nov 1, 2011
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