Native Business key to Alaska's Oil Patch: Native oilfield contractors impact industry in Alaska.

• Author: Liles, Patricia

Increased activity in Alaska's oil and gas industry, particularly on the North Slope, has translated into additional opportunities for the state's Native regional corporations participating in that sector of Alaska's economy.

Established by terms included in the Alaska Native Claims Settlement Act, which also cleared the way for oil development on the North Slope, the 13 Native regional corporations have grown in size and scope of business since their formation in 1971.

Today, Native corporation business entities are playing a major role in Alaska's oil and gas industry, particularly on the North Slope. Involvement ranges from drilling to construction to trucking to camp services.

"Native corporations are playing a huge role in providing goods and services on the North Slope," said Paul Laird, general manager of the Alaska Support Industry Alliance.

He noted that Doyon Drilling Inc., a subsidiary of the Interior-based Doyon Ltd., is one of the largest drilling contractors working on the North Slope.

SUCCESS SHOWS

Success has increased in recent years for that oilfield contractor, according to the regional corporation's most recent annual financial report. In 2005, Doyon Drilling posted a total net operating income of $14.1 million, a 26 percent increase over the $11.3 million reported in 2004.

"In 2005, (Doyon Drilling Inc.) had its most profitable year yet and projections indicate 2006 will be even better," Doyon managers reported in the corporation's 2005 annual report.

The increase came due to a hike in drilling activity on the North Slope, where Doyon's five land-based drill rigs are located. "High demand has increased rig utilization to 92 percent in 2005, up from 70 percent in 2004 and 67 percent in 2003," the annual report said.

"It's a major part of our operations ... one of the rising stars of the corporation," said Daniel "Toby" Osborn, chief financial officer at Doyon Ltd. "Doyon Drilling is very successful, one of the most successful of our operating companies and it contributes significantly to our bottom line."

In 2005, Doyon Drilling contributed slightly more than half of the Native corporation's total net operating income of $27.7 million.

Founded in 1982, Doyon Drilling offers five conventional land drilling rigs and has recently formed a joint-venture partnership with Canadian-based Akita Drilling Inc. to produce a sixth drill rig. Completed in December 2005, the Arctic Fox drill rig is designed as a smaller, more mobile...