Bulk-water export still on hold: Sitka can bank on its water and may eventually help ease water shortages elsewhere in the world.

• Author: Swagel, Will

As recently as this past fall, Sitka officials and principals of an international beverage distribution firm still hoped that the long-awaited first bulk-water sale from Sitka would finally get under way. For the last decade, Sitka has been attempting to parlay its freshwater riches into cash.

Beverage distributor Quest Imports International L.L.C. signed a long-term contract with Sitka pledging to buy 40 million gallons of water for 1 cent per gallon by Dec.12, 2004, netting Sitka $400,000 for its General Fund, should the sale go through. Further sales would be possible because 40 million gallons per year is only a tiny portion of the amount of the fresh water that pours into the ocean from just one stream. Sitka holds two water certificates from the state, each allowing the city to export 12.5 million gallons of water per day.

As the key contract date approached, little new infrastructure has been built for loading the water, but Quest International's Abe Shah said the main problem was bureaucratic. That is, he explained by phone from his office in Manhattan, getting the proper licenses in the East Asian market has been difficult because regulations for shipping bulk water often don't exist.

"Even in Europe the bureaucracy can be a problem," says Shah. "How do we get it in? Are duties already set up for this product? If not, why not? There are special considerations because water has never been done before. What are the requirements of the health department? They may have regulations for bottled water, but not in bulk."

Whether or not Quest Imports meets its December target date-which looked increasingly unlikely, they can probably expect to hold on to support of the city and borough of Sitka. The potential for income, should even a portion of Sitka's bulk-water capacity ever be sold, could make Sitka resemble a little Valdez for water.

HISTORICAL PRECEDENT

This isn't the first time Sitka has attempted to sell water products in bulk, but the last time the town was called Novo Archangelsk (New Archangel) and it was the capital of Russian-America. The Russians cut blocks of ice from a Sitka lake and sold it to San Francisco, Mexico and Hawaii for as much as 5 cents per pound. After the U.S. bought Alaska in 1867, the ice shipments were continued by Americans until the development of artificial ice-making in the 1870s.

Sitka's modern efforts to sell water began in the mid-1990s, several years after the closure of the Alaska Pulp Corp. mill...