Alaska

Embracing Energy: Native Alaskans Say Safe Development Helps Their Cultural Traditions Live On

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Oct. 21, 2015, 11:11 a.m.

This Con­tent is made pos­sible by our Spon­sor, however it is not writ­ten by and does not ne­ces­sar­ily re­flect the views of Na­tion­al Journ­al’s ed­it­or­i­al staff. Amer­ica’s En­ergy is a year-long ex­plor­a­tion of how each of the 50 states is con­trib­ut­ing to our na­tion’s all-of-the-above en­ergy suc­cess story.

BAR­ROW, ALASKA — It’s an icon­ic spot in Bar­row – the farthest-north Alaskan town: whale ribs driv­en in­to the sand form an arch fram­ing a massive whale ver­teb­rae and the Arc­tic Ocean bey­ond.

Whales and whal­ing are in­trins­ic to life and com­munity in Bar­row. Whal­ing teams still go out in skin-covered boats like they have for cen­tur­ies. Whale meat and muk­tuk – dry skin and blub­ber – is stored in ice cel­lars, and eaten at com­munity cel­eb­ra­tions.

There’s an­oth­er in­teg­ral part of life here at the top of Alaska, about 350 miles north of the Arc­tic Circle: oil and nat­ur­al gas. For the past half-cen­tury, oil and gas de­vel­op­ment has been cent­ral to eco­nom­ic life here.  Eld­ers with Arc­tic Slope Re­gion­al Cor­por­a­tion (AS­RC) of­ten talk about whal­ing and oil and gas de­vel­op­ment in sim­il­ar terms, as ele­ments cru­cial to their iden­tity, well-be­ing and sur­viv­al.  In­creas­ingly, they say, en­ergy de­vel­op­ment is be­ing threatened by out­side forces that don’t un­der­stand what it’s like to live in this wind-swept piece of the world that’s covered by snow and ice most of the year.

A few days be­fore Pres­id­ent Barack Obama’s vis­it to Alaska for an in­ter­na­tion­al sum­mit that fo­cused on the im­pacts of cli­mate change, these Alaska Nat­ives said they hoped the pres­id­ent un­der­stood their de­sire to pro­tect nat­ur­al re­sources while also be­ne­fit­ting from re­spons­ible en­ergy de­vel­op­ment.

While many Alaska Nat­ives on the North Slope see the abil­ity and right to hunt whales as ne­ces­sary to sur­viv­ing the winter and keep­ing their cul­ture alive, they also see oil and gas de­vel­op­ment as es­sen­tial to main­tain­ing a ba­sic stand­ard of liv­ing in­clud­ing flush toi­lets, schools and trans­port­a­tion.

“Oil and gas lif­ted us from Third World con­di­tions,” said Jake Adams Sr., chief ad­min­is­trat­ive of­ficer of the North Slope Bor­ough, former may­or of Bar­row and a Nat­ive Inupi­at whal­ing cap­tain.

North Slope oil pro­duc­tion has been cru­cial for the state’s eco­nomy as a whole. Since 1982 every Alaska res­id­ent has re­ceived an­nu­al pay­outs from the state’s oil wealth Per­man­ent Fund. Alaska Nat­ives par­tic­u­larly be­ne­fit from North Slope pro­duc­tion, be­cause Nat­ive cor­por­a­tions have a dir­ect own­er­ship stake in oil pro­duc­tion. A 1971 law es­tab­lish­ing Alaska Nat­ive cor­por­a­tions also man­dated that 70 per­cent of any cor­por­a­tion’s wealth from oil be shared with oth­er Nat­ives throughout the state. This year, AS­RC “reached a his­tor­ic mile­stone in rev­en­ue shar­ing,” as AS­RC puts it, hav­ing shared more than a bil­lion dol­lars with the oth­er Nat­ive cor­por­a­tions thanks to oil and gas.

Many Alaska Nat­ives also see oil and gas as im­port­ant to help them main­tain their sub­sist­ence tra­di­tions, in­clud­ing buy­ing fuel for the boats that they use whal­ing, and al­low­ing them to con­tin­ue liv­ing in re­mote vil­lages where there are few oth­er in­dus­tries or jobs.

“They want to and should main­tain a sub­sist­ence life­style but we very much live in a cash eco­nomy and they need a way to bal­ance that, a good job and the abil­ity to buy the gas­ol­ine to put in the snow ma­chines to get the cari­bou,” said Kara Mori­arty, pres­id­ent and CEO of the Alaska Oil and Gas As­so­ci­ation and a former teach­er on the North Slope. “It comes down to very prac­tic­al things.”

AS­RC was one of 12 Alaska Nat­ive cor­por­a­tions formed un­der the Alaska Nat­ive Claims Set­tle­ment Act of 1971. The act was a way to award land titles and provide com­pens­a­tion to Alaska Nat­ives for land they had lost, a mis­sion that be­came even more im­port­ant after the 1968 dis­cov­ery of oil in Prud­hoe Bay.

Oil and gas cur­rently ac­counts for a third of AS­RC’s rev­en­ue, which is dis­trib­uted to about 12,000 Alaska Nat­ive share­hold­ers. Des­cend­ants of the ori­gin­al 3,700 share­hold­ers be­come ARSC share­hold­ers, hence the num­ber is con­stantly grow­ing.

For dec­ades now there has been sig­ni­fic­ant on­shore oil ex­trac­tion on Alaska’s North Slope. Pro­duc­tion ramped up quickly in the late 1970s and peaked at 2 mil­lion bar­rels per day in 1989. It has de­clined stead­ily since then and cur­rently stands at about half a mil­lion bar­rels per day. As North Slope pro­duc­tion has de­clined and with im­prove­ments in tech­no­logy, there is in­creas­ing in­terest in off­shore drilling.

In Ju­ly, Obama ap­proved ex­plor­at­ory drilling in the Chuk­chi Sea by Shell, which holds off­shore leases there. Though Shell ul­ti­mately de­cided not to pur­sue the pro­ject at this time, the com­pany’s part­ner­ship agree­ment with Alaska Nat­ives – of­fer­ing equity in oil de­vel­op­ment to Arc­tic Inupi­at Off­shore LLC (AS­RC and six cor­por­a­tions rep­res­ent­ing Alaska Nat­ive vil­lages) – shows how Nat­ive com­munit­ies can be­ne­fit from new oil and nat­ur­al gas ven­tures.  Six of eight Nat­ive vil­lage cor­por­a­tions on the North Slope were part of the agree­ment, in­dic­at­ing the strength of sup­port for off­shore drilling by Alaska Nat­ives.

AS­RC lead­ers say the agree­ment and off­shore drilling more gen­er­ally is cru­cial to help­ing them main­tain their stand­ard of liv­ing and cul­tur­al prac­tices like whal­ing.

Rex Rock Sr. is AS­RC pres­id­ent and CEO. He said it wasn’t un­til after oil be­came a re­source for Alaska Nat­ives that they were able to ad­opt mod­ern life­styles in­clud­ing “get­ting rid of the honey buck­et” once used in­stead of toi­lets. He de­scribed how be­fore oil de­vel­op­ment star­ted, he as­sumed he would have to leave the com­munity to go to school, which made him anxious about leav­ing his aging grand­par­ents. But once on­shore oil de­vel­op­ment star­ted, the rev­en­ue helped build a high school in his North Slope com­munity and he was able to re­main at home. “It’s things like that – in­dustry has made a huge dif­fer­ence,” Rock said. 

Richard Glenn, AS­RC ex­ec­ut­ive vice pres­id­ent for lands and nat­ur­al re­sources, ex­plained that AS­RC’s lead­ers are de­term­ined to con­tin­ue grow­ing the cor­por­a­tion’s rev­en­ue so it can keep provid­ing con­sist­ent pay­outs to the in­creas­ingly large num­ber of share­hold­ers and a range of oth­er be­ne­fits in­clud­ing schol­ar­ships, be­reave­ment grants and so­cial ser­vices.

North Slope Alaska Nat­ive lead­ers see de­vel­op­ment of the off­shore re­sources as es­pe­cially cru­cial giv­en that the on­shore oil fields cur­rently in pro­duc­tion in the area have been de­clin­ing for years. The Trans-Alaska Pipeline Sys­tem, or TAPS, takes oil from Prud­hoe Bay on the North Slope about 800 miles to the port of Valdez on Alaska’s south­ern coast. Cur­rently, TAPS is run­ning at less than a quarter of its ca­pa­city, less than half a mil­lion bar­rels a day com­pared to 2.1 mil­lion bar­rels a day at its peak in 1988.

Low volume poses chal­lenges, be­cause at re­duced flow rates it takes much longer for oil to travel the pipeline, and the oil be­comes colder.  Both can lead to set­tle­ment of wax particles car­ried by the oil as well as to ice buildup with­in the pipe, both of which re­quire re­mov­al.

If sig­ni­fic­ant off­shore pro­duc­tion be­gins, the oil would likely be shipped through the pipeline, se­cur­ing its fu­ture and the eco­nom­ic be­ne­fits the pipeline sys­tem of­fers to Alaska Nat­ives and oth­ers on the North Slope and along its route. The pipeline em­ploys about 800 people, with at least 20 per­cent of those jobs go­ing to Alaska Nat­ives. The com­pany that runs the pipeline, Alyeska, also has an Alaska Nat­ive Pro­gram that in­cludes job train­ing, edu­ca­tion and oth­er op­por­tun­it­ies, in­clud­ing ca­reer de­vel­op­ment for man­age­ment po­s­i­tions.

Off­shore oil de­vel­op­ment has been slowed be­cause of fed­er­al reg­u­la­tion and per­mit­ting delays. At the same time, op­pon­ents of oil and gas de­vel­op­ment have worked to stall Alaska pro­jects, cit­ing en­vir­on­ment­al and cli­mate con­cerns. Mori­arty coun­ters: “As long as we’re go­ing to con­tin­ue to rely on oil and gas to meet our en­ergy needs, why wouldn’t you want that to come from Alaska, we’re I’d ar­gue we are do­ing more with emis­sions con­trol and safety stand­ards than any­where else on the plan­et? For us in Alaska we have been co-ex­ist­ing with de­vel­op­ing our re­sources and pro­tect­ing our land forever – that’s what we know how to do.”

The Vil­lage of Point Hope had filed a law­suit op­pos­ing the leas­ing of off­shore oil rights to Shell in 2008. But in March the vil­lage dropped the law­suit, after new fed­er­al safe­guards were an­nounced. Vil­lage lead­ers now sup­port de­vel­op­ment.

North Slope lead­ers say that as a res­ult of con­ver­sa­tions with in­dustry, they are con­vinced that de­vel­op­ment can be done safely, and that re­sponse and mit­ig­a­tion plans would be in place in case of any ac­ci­dents.

Adams said one way the oil in­dustry won them over is by en­sur­ing that whal­ing will not be im­pacted by ex­plor­at­ory drilling. 

He de­scribed how Shell and oth­er in­dustry rep­res­ent­at­ives have worked with Nat­ives to un­der­stand the mi­gra­tion pat­terns and be­ha­vi­or of bowhead whales and oth­er wild­life and altered their op­er­a­tions to pro­tect the an­im­als.

“The pro­cess has been to sit down with them, work with them, talk to them about when they shouldn’t have any activ­it­ies in the area, when we are go­ing after whale,” he said. “When we’re done, we no­ti­fy them that we’re done for the fall and they can re­sume.”

Craw­ford Patko­tak is AS­RC ex­ec­ut­ive vice pres­id­ent for share­hold­er en­gage­ment and an Alaska Nat­ive whal­ing cap­tain. He re­called when con­cern over whale pop­u­la­tions and an­im­al rights cam­paigns en­dangered Nat­ives’ right to whal­ing. He ex­plained that they worked with non-gov­ern­ment­al or­gan­iz­a­tions, sci­ent­ists and gov­ern­ment agen­cies so that whale pop­u­la­tions were bet­ter un­der­stood. Since then, whale pop­u­la­tions have in­creased while Alaska Nat­ives have con­tin­ued to hunt them. 

“It’s about tak­ing a les­sons-learned ap­proach and look­ing at his­tory,” Patko­tak said. “That takes us to off­shore de­vel­op­ment. It’s mak­ing sure we at­tain the right bal­ance, main­tain­ing our cul­ture and what we see as a great op­por­tun­ity.”

Tara MacLean Sweeney grew up in Bar­row and now serves as AS­RC ex­ec­ut­ive vice pres­id­ent of ex­tern­al af­fairs.

“When it comes to re­source de­vel­op­ment in the Arc­tic, many people feel like we have to choose between re­source de­vel­op­ment and en­vir­on­ment­al stew­ard­ship,” she said. “The real­ity is it’s not an either-or situ­ation. It’s find­ing that bal­ance and work­ing to en­sure that de­vel­op­ment takes place re­spons­ibly, and to con­tin­ue to pro­tect the en­vir­on­ment as the good stew­ards that our people are, be­cause the en­vir­on­ment also defines why we are, who we are as Inupi­at people.”

This Con­tent is made pos­sible by our Spon­sor, however it is not writ­ten by and does not ne­ces­sar­ily re­flect the views of Na­tion­al Journ­al’s ed­it­or­i­al staff. Amer­ica’s En­ergy is a year-long ex­plor­a­tion of how each of the 50 states is con­trib­ut­ing to our na­tion’s all-of-the-above en­ergy suc­cess story.

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