​Alaska governor proposes oil storage depot at former base

Alaska's governor has proposed that the U.S. Department of Energy expand the nation's emergency supply of crude oil by adding a storage site at a former Alaska naval base.

Republican Gov. Mike Dunleavy sent a letter Oct. 31 suggesting an oil depot on Adak Island, The Anchorage Daily News reported Sunday.

A storage facility on the island could reduce the risk of supply disruptions for America's Asian allies and West Coast markets, Dunleavy said in the letter.

The Energy Department's Office of Strategic Petroleum Reserves is studying locations for future storage sites, creating an “excellent opportunity” to consider sites in the western U.S., Dunleavy wrote.

"The proposed Adak project would cut maritime delivery times to the West Coast and to our strategic Asian partners from weeks to days,'' the governor wrote.

Adak Island is the nation's westernmost community, located 1,931 kilometres from Anchorage in the Aleutian Chain. The former Adak Naval Air Facility closed in 1997.

David Ott, a former manager for Royal Dutch Shell plc in Alaska, said he has worked with Dunleavy's economic development team and pitched the idea to the federal energy department.

Ott projected a cost of $2.5 billion with upgrades to Adak's former facilities, including its port and airport. The depot could begin by holding 100 tanks storing 100 million barrels of oil, he said.

The energy department would lease the facilities as a long-term anchor tenant from the Aleut Corp., the regional Native corporation that owns the former base.

Aleut Corp. officials did not immediately return calls seeking comment.

The energy department said in an emailed statement that the agency was aware of the idea.

The proposal could create jobs for Alaskans and opportunities for the companies that develop and manage the site, supporters said.

The depot would diversify the locations of the U.S. Strategic Petroleum Reserve, which includes 635 million barrels of oil held in four underground salt caverns in Louisiana and Texas, proponents said.

The reserve holds enough oil to meet the national demand for a month and can be released by a presidential order.

© 2020 The Canadian Press