Alyeska shifts jobs away from Chugach

In a series of major cost-cutting decisions, Alyeska Pipeline Service Co. is finalizing new agreements with contractors that could shift hundreds of trans-Alaska pipeline jobs away from unions.

The company says it is trying to become a leaner operation because the amount of oil flowing through the 800-mile pipeline is declining. In all it is slashing its spending by 15 percent next year, to $600 million, Alyeska officials said.

The company isn’t just targeting labor expenses. Alyeska said in early December it also plans to shrink its office space in Alaska, and the first steps may involve closing one or more of its offices in Fairbanks and Valdez and shifting an unknown number of workers to Anchorage.

The goal of the changes is to keep the pipeline running as long as possible, said Alyeska spokeswoman Michelle Egan.

She said the company will know exactly how many jobs might be shifted out of Fairbanks and Valdez by the end of the year.

The impact on unions will be significant. Alyeska said 300 to 400 contract jobs could transfer from unionized Chugach Alaska Corp. to non-unionized ASRC Energy Services under a proposed new maintenance contract. Both contractors are Alaska Native firms.

Egan said ASRC Energy offered Alyeska a proposal for maintenance work that will save the pipeline company “tens of millions of dollars per year,” mainly due to lower costs per worker for wages and benefits, and also reduced overhead costs.

The Alyeska announcements are bad news for the Fairbanks economy and for the five unions that make up the Alaska Petroleum Joint Craft Council, which has supplied workers under Alyeska’s maintenance contracts for the past 30 years or so, said Jim Laiti, business manager for Plumbers and Pipefitters Local 375, and president of the craft council. He said the unions’ benefit packages can be costlier than non-union employers because of training programs, pensions and other perks.

—Anchorage Daily News