Valdez: not just for supertankers.

• Author: Bohi, Heidi
• Position: Towns in Transition

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While the entire state anxiously watches the petroleum industry reduce its investments on the North Slope--which in turn adds to the continuing decline of oil production that has been on an unsustainable trajectory for the past two decades--Valdez, more than almost any other community in Alaska, is especially nervous about the harsh reality of what it will mean for this seaside town of 4,498 residents if the industry does not make the capital investments needed to support future oil and gas developments.

Valdez is the southern terminus of the trans-Alaska oil pipeline. Supertankers navigate the deep, ice-free waters of Valdez Arm each day, handling more than 1.5 million barrels of crude oil. Without long-term commitments, it is not out of the question the reduced throughput would result in the trans-Alaska oil pipeline not being able to efficiently operate the pipeline and pump stations because it would be carrying far below the daily number of barrels it was designed to carry, requiring fewer employees for the Valdez operation.

BIGGEST CHALLENGE

"The biggest challenge for Valdez is that we're still too comfortable with the amount of tax revenue and the jobs the oil industry provides to make us want to look as seriously as we need to at economic diversification in the community," says Lisa Von Bargen, community and economic development director for the city of Valdez. "The oil industry provides 85 percent of our tax base and if that dwindles, being able to maintain a community infrastructure and basic services will be very difficult."

Although the petroleum industry is considering how it can approach the future strategically, Von Bargen says the city does not know what this will ultimately mean for Valdez in terms of jobs. Developing a strategic plan for the community's future is one step the city needs to take to prepare for the possibility of losing its largest source of taxes and employment.

"We knew in 1977, when the first barrel of oil came down the pipeline the mainstay would probably only last 20 years," she says. "Here we are 33 years later and Valdez still doesn't have a strategic plan for its future. At some point we need to recognize that oil is not going to be around forever."

IMPROVING COMMUNITY

In the meantime, Valdez is taking a number of smaller steps to improve the quality of life and make the community more appealing to companies doing business there.

Known as the "salt-water playground" for the...