Alaska Native corporations, our large private landowners, frequently take the lead in natural resource and economic development. We see these corporations hustling for minerals and oil exploration on their land and sometimes land owned by others. We see them taking the leading innovative development projects too.
Most recently, Doyen, Ltd., the Interior regional corporation, and two other Alaska firms -- Arctic Slope Regional Corp., another Native corporation, and Fairbanks-based Usibelli Energy -- engineered a deal with a Denver independent petroleum company to drill an exploration well in the Nenana Basin west of Fairbanks. The venture includes land owned by Doyon as well as the state and the University of Alaska, which would also benefit if the well planned for next summer strikes gas.
Another example of entrepreneurship but also with some long-term thinking and regional planning is an effort by Tyonek Native Corp., owned by shareholders from a small village on Cook Inlet's west side, to facilitate some big development projects that are planned nearby.
Tyonek's goal is not only to position itself to be involved in these projects, most likely in support services, but also to shape the development to reduce any harm to local wildlife habitat as well as the traditional Tyonek community. What's refreshing about this is that we see the people who live closest to these projects saying "yes" to them, as long as they are done right.
Tyonek has developed a visionary plan that sets aside land it owns that is important for fish and game protection but also land for industrial development and infrastructure. In fact, a 1,000-acre industrial area has been established, and Tyonek is working on a plan for road access from the Matanuska-Susitna Borough and planned housing subdivisions that would accommodate new population it feels the industrial projects will inevitably lead to.
Meanwhile, what are the projects? They are several. On the front burner is a medium-sized coal mine on nearby state land that is planned by the Bass-Hunt group of Texas. Another nearby coal deposit, owned by Barrick Gold, also could be developed.
These mines would export coal to Asia, at least initially, but there is also a plan for a coal-to-liquids plant that would convert coal from the mines to high-quality, environmentally clean liquid fuels that are much in demand in U.S. West Coast markets.
An objection some have to these mine projects is that the coal they would export, if used in industrial or power plants in China, would put more carbon dioxide into the atmosphere, contributing to global warming.
The coal-to-liquids strategy would avoid this. A key advantage of the process is that it will capture CO2, and a plant at that location could inject the gas into nearby depleted underground oil and gas reservoirs and possibly use it to get more oil from aging Cook Inlet oil fields.
Tyonek likes this idea because the liquid fuels made would have a much higher value than the coal and would create a lot of jobs as well as several billion dollars in new industrial tax base for the Kenai Peninsula Borough. An Anchorage firm, Alaska Natural Resources-to-Liquids, is working to bring into this project Sasol, the South African energy company that is a leader in coal-to-liquids.
Two other prospects for the area are the Mount Spurr geothermal project and the Chakachamna hydro project, which are near each other west of Tyonek. Both are being evaluated by private companies -- Chakachamna by TDX Power, another Alaska Native-owned company, and Mount Spurr geothermal by Ormat Nevada Inc.
Tyonek has other projects in mind, including gravel sales from its land. However, with the electricity potential of Mount Spurr, Chakachamna and waste heat from the coal-to-liquids plant that could generate 400 megawatts of power there could be a lot of low-cost electricity that could feed into the existing Southcentral-Interior power grid. Chugach Electric Association's Beluga Power plant is just a few miles from Tyonek.
With natural gas being depleted in Southcentral gas fields, the region needs new alternatives to gas-fired power generation. Tyonek hopes low-cost electricity could help attract other businesses to the region too.
All in all it's quite a vision. Tyonek deserves a hand for encouraging regional economic development and working to ensure it is done properly. I call that far-seeing leadership, and we need more of it in Alaska.
Tim Bradner writes for an Alaska economic reporting service. He also consults for private clients and writes for business publications. His opinion column appears every fourth Sunday.