Alaska Native Corporations Work at Home
DThe 13th Inuit Circumpolar Council General Assembly took place in Utqiaġvik in July. During that assembly, Arctic Slope Regional Corporation CEO Rex Rock Sr. voiced his support for oil and gas development in the Arctic.
Services in the North Slope oilfield
An Olgoonik team prepares a cement sack over the batch mixer in remote NPR-A, February 2018.
“Our region is dependent upon the economy that oil and gas development brings,” he stated. Yet he was also clear to express that it is vital for Alaska Natives to have a voice in the discussion of how the oil and gas industry moves forward on the North Slope. “By having a seat at the table during the decision process, we will have the opportunity to influence projects for protection of our rights as indigenous people.”
And many of the corporations established by the Alaska Native Claims Settlement Act have engagement in the oilfield beyond roles as stakeholders and resident experts of the Alaska Arctic—they participate in the oilfield through lease-holding, exploration, development, operations, and the many, many support services related to those activities. Being involved in the oil and gas industry directly is both an economic opportunity for residents of the Arctic as well as a method to ensure local knowledge and talent are used for the benefit of the operating companies, the environment, and Alaska as a whole.
Olgoonik Oilfield Services
Aerial view of Olgoonik’s thirty-man sleigh camp onsite in the foothills of the Brooks Range, 120 miles from the road system.
Olgoonik Corporation is headquartered in and is the corporation for Wainwright, located on the coast of the Chukchi Sea on Alaska’s north coast. The company has more than 1,300 shareholders, almost half of whom live in the area. “We are a North Slope village, so we’re trying to provide services within the North Slope,” says James Nunley, general manager of Olgoonik Oilfield Services (OOS).
The company finds itself “at home in the Arctic” and provides a range of remote construction, operation, and environmental support services, including construction, demolition, and waste management; well plugging and abandonment, fuel hauling, and camp/facility management; and regulatory permitting, spill response and cleanup, and work plan preparation, just to skim the list.
Nunley says that recently the company has been under contract with another North Slope corporation, hauling more than 500,000 gallons of fuel from Utqiaġvik to Atqasuk. “OOS was successful in its first year of hauling fuel, and we met the requirements of the contract, so we’re going to go back and do it for the foreseeable future,” he says.
OOS has also been working on a legacy well plug and abandonment contract for the US Bureau of Land Management (BLM). In 2016 the company successfully completed three well closures that were near Utqiaġvik “just off the road system,” and in the winter of 2017 the company “launched into NPR-A 150 miles away from the road system, with complete equipment, and completed five plug and abandonments for BLM in the Legacy Well Program,” for a total of eight closures to date.
The BLM Legacy Well Program is under an IDIQ contract, which means Indefinite Delivery, Indefinite Quantity; a government contract that allows for an undefined amount of services or work to be performed within a fixed amount of time—in this case five years, ending in 2021. The Legacy Well Program IDIQ was awarded to both Olgoonik and Marsh Creek. As BLM secures funds for the program, it publishes task orders, which the two companies then bid to complete—Olgoonik has been awarded the last two task orders, Nunley says, and they’re hoping to soon secure a third.
Olgoonik Construction Services (OCS) is also active in the Arctic, providing civil, vertical, and horizontal construction, and the company just recently added power generation to its resume, according to General Manager Dave Smith. “We’re re-doing the generators for the Barrow Gas Fields this winter; we’re putting in three new micro turbines.” That project will begin “as soon as we can get on the tundra,” says Olgoonik Vice President, Commercial Division Steve MacRae.
Planning for the approximately $3 million project for the North Slope Borough began in July, with OCS acquiring materials and planning logistics, but “the onsite fieldwork will be January until April,” MacRae says, adding the project will use a crew of about six people.
Olgoonik has a few projects slated for this month, including building two gravel pads and assembling office space modules for a North Slope company. It’s also starting a landfill closure project in Utqiaġvik. “Whenever there’s strong wind from the east, the nearby lake picks up waves, so it’s eroding part of the landfill. So we’re going to do some erosion abatement around a portion of the landfill,” Smith says.
That project should be completed by December, allowing the crew to move on to the generator/micro turbine project.
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Employees at Work
Olgoonik team member Amanda Baxter in Utqiaġvik.
Maintaining a core group of employees who work on a variety of projects one after another is one practice that sets Olgoonik apart from other oilfield service providers. “I would say we have a core group of employees that we ‘fight’ over and move around from subsidiary to subsidiary as the workload fits,” Smith says. When the project calls for additional workers, the company will bring on more people, local if possible and other talent from around Alaska if not.
Nunley explains, “We’re moving toward hiring North Slope Borough residents and, as much as possible, shareholders for the long term.”
MacRae adds, “Our goal is local hire and shareholder hire. We’re one of four communities that actually reside within NPR-A, so our focus is on North Slope employment. And, actually, it’s economic for us to do that.” Hiring locally can reduce or eliminate costs such as transportation to and from Anchorage or Fairbanks and providing housing.
How Olgoonik shares employees between subsidiaries benefits the company and the employees, as work is steady throughout the year. “It’s a good mix: we have winter oilfield work and then summer time construction,” MacRae says. “We don’t really have a lull time,” Nunley adds. Smith continues, “We have guys asking us for time off opposed to us giving them time off. A typical scenario is coming up: one of the subsidiaries has an Air Force job where they’re doing some demolition. From that demolition, the same equipment and same people will move onto closing a landfill, an OCS project. Then, when that project is over, those people will get a Christmas break and then go right over to OOS for legacy wells.”
The company’s focus on hiring shareholders and local talent also pays off regularly with talented and hardworking personnel. “We hired a gentleman who had absolutely no construction experience whatsoever, but he was a local shareholder. He went on the job, was a likeable fellow, and people took him under their wing and taught him, and he’s become an unbelievable asset. As a matter of fact, between OOS and OCS, as soon as January comes we’re ‘fighting’ over where he’s going because he’s such a good employee—and he’s not the only one,” MacRae says.
Ukpeaġvik Iñupiat Corporation
In 2016 UIC began to utilize PistenBullys, over-tundra vehicles that are environmentally friendly and Alaska Department of Natural Resources Tundra Certified.
Ukpeaġvik Iñupiat Corporation (UIC) is the village corporation of Utqiaġvik (representing 2,900 shareholders) and has provided a full range of services to the oil and gas industry: camp services, remote equipment fueling, labor for contracts, environmental services oversight planning, communications support, project planning, and logistics. “It’s total support from cradle to grave,” says UIC Program Consultant Mike Matteucci.
He says that UIC’s history on the North Slope is primarily in supporting exploration and not production. They have worked across the slope, from southwest of Utqiaġvik to the Umiat area. “Our support services have been dictated by the size of the project… we fill in a lot of the little niches and do what we do best to make it more economical for the project owner. We fit our abilities and equipment and people into the project’s overall scope,” Matteucci says.
The company’s knowledge of the North Slope—in general and through an industry lens—is a benefit for their clients and the other companies they collaborate with. “Our experience up there and the knowledge we have gained working through all the idiosyncrasies that go on up there allows us to be of great value.”
A fairly recent evolution in the way UIC provides services on the North Slope is the company’s adoption and use of PistenBully vehicles, which they’ve been using since 2016. “They’re designed to run in snow and ice conditions, and these machines have proven in the last couple years that they can do the jobs of the equipment that’s presently up there, and in a lot of aspects, can do it a lot more efficiently.”
PistenBullys were designed for use on snow and ice and have been used worldwide for years to sculpt and groom ski slopes and trails. “They have a tendency to flow over snow and ice where other machines have to trudge through it,” Matteucci says.
PistenBullys are capable of transporting personnel in cabs and equipment/materials on sleds simultaneously and can haul materials while pioneering a trail through the snow, increasing efficiency.
UIC has found it’s effective to use PistenBully machines to haul sleds and toboggans loaded with materials, equipment, and other freight in winter months when travel over the tundra is safe and approved. The PistenBully vehicles have several valuable features: they’re fuel efficient, comfortable to drive, and sport advanced technology such as GPS plotters and a feature similar to traction control, making it less likely the vehicle will get stuck.
The fact that they pull sleds (made of UHMW, a high-density plastic) actually adds to their functionality: “Because of the friction [from the sled] when you’re going across, [the snow] tends to heat up a little bit and then cools right back down and freezes, so that actually forms your trail faster.”
The toboggans are twelve feet wide and thirty feet long, and UIC has them specially manufactured with skis that can haul substantial loads; glide easily across the snow and ice; and throw snow off to the sides instead of back in the path of the sled, all of which produce a smoother, better path. “That’s the main reason we can pick up speed on our trails… and we have the ability to pull a load [on the first trip] with us that makes us revenue versus going out, making the trail, and then coming back and starting to make revenue hauling loads,” Matteucci says.
In 2017 UIC Oil & Gas pioneered, built, and maintained a 214-mile snow trail between Prudhoe Bay and Atqasuk for the North Slope Borough using PistenBullys.
Last year UIC also used the machines to haul materials across the Colville River, and including ice coring (checking ice thicknesses to make sure the equipment can safely move across), it took the team an hour and forty-five minutes to cross the river. Other companies crossing the river took two days to create a trail, which included bringing an excavator and bulldozer to the crossing site.
Another time-saving feature that UIC is hoping to soon incorporate in the vehicles would allow them to measure snow depth while traveling instead of stopping to use a rod. PistenBullys only need a few inches of snow to be able to travel, but depending on the area, the state requires that there are between twelve and sixteen inches of snow to ensure a certain amount of frost depth and to protect the tundra. Measuring snow while traveling would save UIC time, a precious commodity in the short winter exploration season.
“We’re trying to figure out ways to be more efficient,” Matteucci says.
For example, UIC maintains a support camp at Umiat, complete with a 5,600-foot runway. For a recent project UIC flew in between 200 and 300 plane loads of materials, as well as pulled materials over the tundra. “We brought in drill pipe and drilling fluids and staged everything for [the client] at that site. As they need it they come and pick it up—it’s kind of a small, regional storage facility so they don’t have to rely on getting materials out of Deadhorse on time.”
UIC also invested in cabs for the PistenBullys that can transport ten to fifteen personnel at a time. And the PistenBully can haul a sled full of freight simultaneously. “[Clients] don’t have to run their busses back and forth, they get everything all at once,” Matteucci says.
UIC has found other small projects around the state that play well into their capabilities. “We’ve had a couple minor projects that were three or five days—they’re mainly in the spring when the rivers start to thaw and the State of Alaska is doing ice profiling. They’ll study the hydrology for floods and things like that.” Recently UIC hauled 200,000 pounds of structural lumber for the US Forest Service in the Wrangell-St. Elias National Park to build boardwalks.
New Work, New Optimism
The Olgoonik team in remote NPR-A, March 2018.
Both Olgoonik and UIC look forward to additional opportunities for projects in the Alaska oil and gas industry. “There’s still a lot of work going on in the North Slope right now, but they’re small crew and small jobs. It’s a matter of scale,” Matteucci says. To illustrate his point, in his experience in past years a pickup truck would need to be reserved three or four weeks in advance of a project to ensure one was available, but today a company can rent a pickup without even making a reservation.
And there’s optimism in the air about the near future, specifically starting in 2019. “I believe we’re headed for a definite pick up, just based on new horizons, looking over toward ANWR: it all starts out with a seismic base, and word on the street is that it’s lining up that way… that’s where Olgoonik wants to be to support whatever projects come out of it,” Nunley says. Smith agrees, saying, “I’m seeing an uptick. I’ve seen for eighteen months that it was coming, and it will. The question is how fast it’s going to come.”
“Everybody has that feeling that 2019 is going to better; we haven’t maybe seen the bottom yet, but we’re probably hovering on the bottom and the upswing will come,” Matteucci says. UIC is excited, as those opportunities do manifest, to have a larger presence in the oil field. “We’ve wanted to grow over the years, but it has been a very tight market. In 2019 we’re hoping for some more opportunities; we see some openings coming up.”
Tasha Anderson is the Associate Editor for Alaska Business.
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The 2019 Best of Alaska Business Awards
Welcome to the fourth annual Best of Alaska Business Awards! As part of our continuing mission to support Alaska’s business communities, each year we look to you, our readers, to tell us which businesses excel in a range of diverse categories.