No Gas for Nome, Alaska

Article from the Alaska Dispatch
28 November 2011

Unleaded gasoline sells for $5.43 a gallon at the pump in Nome, but that price could skyrocket by this spring because a fuel barge with more than 1 million gallons didn't arrive as expected this fall in the remote Northwest Alaska community.
For Nome residents, the cancelled shipment, which petroleum distributor Delta Western blames on stormy weather and sea ice, brings back memories of a similar situation in another rural Alaska community.
In the spring of 2010, after a fuel barge couldn't reach the Interior town of McGrath, the distributor was forced to fly fuel in. Those costly flights pushed prices at the pump from $5.97 to $8.50 a gallon. Nome Mayor Denise Michels said her community of 3,600 isn't facing an emergency yet. But if Nome fuel stocks drop too low this spring, supplies would have to be flown in, which would raise prices at the pump.
Hopefully, Delta Western and Bonanza Fuel, the company that ordered the 1.6 million gallons of gasoline, diesel fuel and heating fuel, can reach an agreement that avoids passing costs onto Nome residents, said Michels. The companies are discussing the problem now, she said.
"They need to figure it out," Michels said.

The barge carrying the big fuel load couldn’t reach Nome, in part because of stormy weather, including the recent tempest in the Bering and Chukchi seas, said Kirk Payne, Delta Western vice president. Sea ice that has since enveloped the community, delivering the final blow. The barge won't reach Nome this winter, Payne said.
It's possible that costs related to the canceled barge shipment could be rolled into a state disaster declaration, said Scott Ruby, director of the state Division of Community and Regional Affairs.
Gov. Sean Parnell's Disaster Policy Cabinet meets on Wednesday to consider whether damage from the mid-November storm across a wide swath of western Alaska warrants a disaster declaration from the state. The cabinet will advise the governor, who makes the final call, Ruby said.
Nome has asked the state's emergency services division to determine whether a disaster declaration would cover the cost of higher fuel prices, said Michels. It might, but the city hopes Bonanza and Delta Western resolve the issue themselves.
One question is whether the weather was truly the problem, said Michels.
It was, said Payne. But Jason Evans, board chair of Bonanza parent company, Sitnasuak Native Corp., said Bonanza ordered the fuel in May, and the company has been awaiting its order for three months. "There's not been 90 days of extreme weather," Evans said, and other barges have reached Nome before ice surrounded it.

Contact Alex DeMarban at alex(at)alaskadispatch.com