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Alaska regulators want utilities to address emergency plans as they face gas shortage

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Alaska regulators want utilities to address emergency plans as they face gas shortage


Alaska utility regulators said this week they will soon begin pressing utilities for their emergency plans as concerns about unexpected power interruptions grow amid an expected shortage of Cook Inlet gas.

The five-member Regulatory Commission of Alaska will likely start the discussion with the Homer Electric Association early next year, since the utility will be the first to have its supply contract for gas end, said Commissioner Robert Pickett in an RCA meeting on Wednesday.

“We will be looking at each of the utilities that have gas supply agreements, starting with the ones where the wall is the closest,” Pickett said, referring to the end date for utilities’ gas supply contracts.

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Homer Electric’s contract with Hilcorp is set to end before April. A Homer Electric official said on Thursday the utility has an agreement to purchase natural gas from gas company Enstar once the Hilcorp contract ends.

Hilcorp, the dominant Cook Inlet gas producer, warned Railbelt utilities from Homer to Fairbanks last year that it may not be able to renew gas supply contracts as gas production wanes in the aging basin.

For the state’s biggest electric utilities, Chugach and Matanuska electric associations, those gas supply contracts aren’t set to end until 2028. Enstar’s contract with Hilcorp is set to end in 2033.

Natural gas is the primary fuel source for electricity and heat in Southcentral Alaska.

Commissioners on Wednesday questioned how the utilities would deliver electricity in the event of reduced power supply, if enough natural gas can’t be delivered to turbines.

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The commissioners said it’s time to start thinking about worst-case scenarios, such as making sure some customers are protected during power interruptions.

[Alaska’s looming natural gas crisis draws growing attention from mayors, state regulators]

“Because obviously there are different types of customers,” Pickett said. “You don’t want to shut off the hospital. You don’t want to shut off critical communication assets.”

“And I don’t think that has sufficiently been thought through,” he said of the utilities’ plans.

RCA chair Robert Doyle said people don’t like to talk about worst-case scenarios. But he said it’s time to start planning.

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He referenced the Texas power grid failures in early 2021 when extreme winter cold led to long power outages for millions of homes in that state, and almost catastrophic failure of the grid.

“We’re talking about very serious things,” Doyle said.

Officials with Chugach and Matanuska electric associations said earlier this week that they are pursuing options to secure additional gas supply and are not discussing brownouts or blackouts tied to reduced supply. A blackout is a full interruption of power in a given area. A brownout is a partial, temporary reduction in power.

Jenniffer Rosin, a spokeswoman with Homer Electric, said the Railbelt utilities are working together to identify future sources of fuel, including renewable energy and importing liquefied natural gas.

“We’re working with the Railbelt utility working group to avoid any power issues,” Rosin said. “We take this very seriously. Everyone affected by this gas crisis is taking this very seriously.”

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“We’ll do what we need to keep the lights on,” she said of Homer Electric. “There won’t be blackouts. We won’t let that happen.”

Based in Homer, the electric utility provides power to several Kenai Peninsula communities, including Soldotna and Kenai. It has about 25,000 members.

Rosin said Homer Electric has entered into a procurement agreement with Enstar to acquire gas after the electric company’s gas supply contract with Hilcorp ends early next year. The agreement is awaiting signatures and has not yet been filed with the regulatory commission, she said.

“For the time being there won’t be a gas shortage, but everyone will still be in this gas shortage crisis,” she said of Homer’s agreement with Enstar.

Overall demand for Cook Inlet natural gas is expected to begin exceeding supply by small amounts in 2027, with the gap growing from there, experts have said.

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Rosin said the Homer utility is preparing to respond to the commission’s request.

“We’re getting ready for what we need to do if that’s the way they want us to go,” she said. “We will be there.”

Pickett at the meeting expressed concern about the difficulty the utilities might face in securing a good future contract for liquefied natural gas in a market where prices are extremely volatile. He also indicated that renewable energy projects may not be built quickly enough to address the gas shortage.

Commissioner Jan Wilson said she agrees with Pickett’s plans to understand how utilities will deal with any potential emergency scenarios.

“It’s an unpleasant issue to contemplate, but I agree with you that it’s necessary and it’s within the commission’s area to be holding the utilities to some kind of standard,” Wilson said.

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Alaska

In Alaska, Santa’s helpers work around the clock to deliver holiday packages

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In Alaska, Santa’s helpers work around the clock to deliver holiday packages


North Pole, Alaska — ‘Twas the week before Christmas and plenty was stirring at the Santa Claus House in the city of North Pole, Alaska.

The iconic Christmas-themed store checked its list twice, realizing that it is far more naughty than nice if any of the gifts it sends out arrive late to their destinations around the globe.

“People are used to waiting until the very last minute to shop online, which presents a challenge for us having to process that order and ship it out from Alaska,” said Paul Brown, manager of the Santa Claus House, which for decades has been sending thousands of annual Santa letters to children worldwide.

In North Pole, which is located about 13 miles southeast of Fairbanks, candy canes double as street lights, and Christmas takes on special meaning for resident and FedEx driver Bill Soplu. 

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“Yeah, this is a wonderful time of the year,” Soplu said. “Everybody’s so happy right now, so it makes our job a lot easier.”

The cold weather doesn’t diminish Souplou’s cheer.

“Just the other day it was 30 above, you know, and then you wake up the next morning, it’s 30 below,” he said.

Nor do the moose.

“We don’t want to mess around with those guys,” he adds.

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The gifts Soplu is delivering come from an airfield 20 miles down a frozen road. There are only a few hours of daylight in Fairbanks during the winter months, and the temperature hovers around zero.

An average of 3,000 packages a day come through Fairbanks during the holiday season. Capt. Joseph Erikson is a delivery pilot for FedEx. 

“I know there’s a good chance there’s a special present on that plane, and it’s important to get that to that family,” Erikson told CBS News.

Before they reach Fairbanks, shipments from around the world first come through a sprawling FedEx sorting center at Ted Stevens Anchorage International Airport.

During the holidays, there are 33 delivery planes a day which fly in and out of Anchorage carrying about 80,000 packages. The planes run around the clock so gifts can span the globe in as little as 24 hours.

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“We’ve been putting these plans in place for months so we can make sure we’re getting those packages to our customers,” said David Lewis, senior manager for surface operations for FedEx in Alaska.



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Valhalla Metals Provides an Update on Alaska Governor Dunleavy’s Transition Report Submitted to the Trump Transition HQ Prioritizing the Ambler Access Road

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Valhalla Metals Provides an Update on Alaska Governor Dunleavy’s Transition Report Submitted to the Trump Transition HQ Prioritizing the Ambler Access Road


Vancouver, British Columbia–(Newsfile Corp. – December 19, 2024) – Valhalla Metals Inc. (TSXV: VMXX) (OTCQB: VMXXF) (“Valhalla” or the “Company“) provides an update on the Ambler Mining District Access Road.

The proposed Ambler Access Road is planned to cross Valhalla State mining claims at the Sun project and would unlock a host of critical and strategic metals located in the Ambler Mining District – all metals necessary for the green energy and transportation transition and to ensure a secure domestic supply chains for these metals.

On December 16, 2024, Governor Mike Dunleavy submitted a report to the Trump Transition team in Washington D.C. titled “Alaska Priorities for Federal Transition”. The report details both immediate and long-term actions that can be taken to reverse the devastating impact of more than 60 sanctions the Biden administration imposed on Alaska, and how unlocking Alaska’s minerals, oil and natural gas, and other natural resources will benefit both the state and national economy. Priority #1 is described as “”Get Back to Where We Were” and specific to the Ambler Access Road, urges the President-elect to “…rescind the unlawful Biden Administration ROD and issue a new decision restoring the right-of-way permits previously granted to the State” as the Biden Administration’s 2024 No Action Alternative ROD is a direct violation of ANILCA.

In the transition cover letter, Governor Dunleavy tells President-elect Trump, “Your election will hail in a new era of optimism and opportunity, and Alaska stands ready to and is eager to work with you to repair this damage wrought by the previous administration, and to set both Alaska and America on a course to prosperity.”

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Rick Van Nieuwenhuyse, Chairman of Valhalla said: “It is well known in Alaska that the Biden administration broke the law when the Department of Interior’s Bureau of Land Management (BLM) selected the “No Action Alternative” in their Supplemental EIS Record of Decision issued earlier this year. The Alaska National Interest Land Conservation Act (ANILCA) passed in 1980 is very clear that the Secretary of Interior shall grant a right-of-way across Federal lands to connect the Ambler Mining District with the Dalton Highway corridor. It has now been more than ten years of “official” permitting process since the formal application was made. It is high time the Federal Government does what it promised 45 years ago. Let Alaska develop its resources for the benefit of all Alaskans and all Americans.”



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Appeals court reverses $367M award initially granted to Anchorage over faulty port work

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Appeals court reverses 7M award initially granted to Anchorage over faulty port work


ANCHORAGE, Alaska (KTUU) – A panel of federal judges on Monday partially pulled damage awards from a 2021 ruling centered on a Municipality of Anchorage lawsuit against the federal government surrounding faulty construction work at the Don Young Port of Alaska.

The U.S. Court of Appeals for the Federal Circuit opinion, published on Dec. 16, slashes the Municipality of Anchorage’s initially-awarded $367.4 million to a little more than $11 million, more than three years after the court first issued a decision over the suit that sought to prove the United States breached two contracts with the municipality for port improvements.

“This is a disappointment,” said Anchorage Mayor Suzanne LaFrance, who spoke briefly on the published opinion at the most recent meeting of the Anchorage Assembly, calling the decision “unexpected news” on Tuesday night.

“We are continuing to consider appropriate next steps,” she said, adding that the municipal manager “will brief members later this week.”

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The court opinion largely vacates the 2021 U.S. Court of Federal Claims decision but hinges in large part on action from two decades prior, in which the Municipality of Anchorage and the federal government agreed to upgrades and expansions at the aging Port of Alaska.

As referred to in court documents, the municipality and federal government entered into a 2003 Memorandum of Understanding and, later, a supplementary 2011 Memorandum of Agreement, for those improvements to the port. The same documents show the Maritime Administration (MARAD) contracted with Integrated Concepts and Research Corporation (ICRC) in 2003, which in turn subcontracted with others, to complete the project.

“Problems with the project were discovered during a third-party inspection in 2010, when ‘large-scale damage was found in the installed sheet piles,’” according to court documents, “which protect an excavated area from earth and groundwater.

“While ICRC and its subcontractors performed the work, Anchorage ultimately blamed the project issues on MARAD, alleging that MARAD failed to ‘develop project management or inspection protocols,’” according to the opinion, “and ‘abdicated its responsibilities’ to oversee the project.”

These issues precipitated the 2011 agreement, which was designed in part to redefine responsibilities for the project as a whole, with adjustments to oversight including the development of the Port Oversight and Management Organization.

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That same year, however, a subcontractor of the ICRC alleged its work was not being appropriately reimbursed. Without consulting the municipality first, MARAD eventually settled, paying ICRC $11,279,059, court documents show.

In March 2013, the municipality filed its lawsuit against multiple parties – among them, the ICRC and subcontractors – over the “deficient work” at the port, which was settled. The next year, Anchorage filed suit against the federal government in the Court of Federal Claims, claiming MARAD had breached both the 2003 and 2011 memorandums.

On Dec. 9, 2021, the court eventually sided with Anchorage and against MARAD. It also found that the municipality proved its entitlement to claim damages in full, totaling $367,446,809, the following February.

The Court of Appeals, in its opinion this week, affirmed the U.S. Court of Federal Claims determination that the 2011 agreement was breached, given the $11.3 million in subcontractor claims were settled without the municipality’s approval.

However, the appeals court said a “defect-free port” was never required as part of the agreement from 2003, and vacated that portion of the federal claims court’s decision. This cut the damages awarded to Anchorage by more than $169.5 million, as part of the value of the structure the municipality “expected but did not receive”; and nixed an additional $186,607,000, as part of anticipatory costs associated with fixing defects in the existing structure at the time.

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The overturning of this decision pulls a large portion of the funding dedicated for port upgrades, marking the latest in the saga of the years-long modernization project for the port.

According to the port’s website, the Port of Alaska Modernization Project, created in 2014, is meant to support the port continuing to serve as the state’s key inbound cargo gateway, an operation site for national defense infrastructure, and a supporter of consumer goods and emergency needs. Recent data from the port shows imported cargo that moves through the port reaches about 85 percent of all Alaskans.

The next phase of the modernization project is expected to cost up to $2 billion.

Read the full opinion from the Court of Appeals here.

See a spelling or grammatical error? Report it to web@ktuu.com.

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