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Vol. 12, No. 44 Week of November 04, 2007
Providing coverage of Alaska and northern Canada's oil and gas industry

PETROLEUM DIRECTORY: Northern Air Cargo’s philosophy: Teamwork that delivers

NAC’s transportation and related services deliver everything from overnight letters to support for large projects throughout North America

NAC has worked in the Alaska bush for more than 51 years and remains committed to providing the most dependable air cargo services to individuals and organizations throughout Alaska and beyond.

Q. When was the company founded, who founded it, and what was its original name?

A. Northern Air Cargo was founded in 1956 by Robert “Bobby” Sholton and Maurice Carlton. In March of 2006 Northern Air Cargo was purchased by Saltchuk Resources Inc., a privately held company with various businesses operating in Alaska including TOTE, Foss, Delta Western and Inlet Petroleum. Additionally, Saltchuk companies operate in various service sectors around the world. We are proud to be Saltchuk’s first air cargo acquisition.

Q. Where is NAC located? Does it have more than one location?

A. NAC’s primary base of operations is in Anchorage, with secondary hubs in Fairbanks and Bethel. Additionally we have an excellent network of agents throughout the state. Regularly scheduled markets include Aniak, Barrow, Bethel, Dillingham, Emmonak, King Salmon, Kodiak, Kotzebue, McGrath, Nome, Prudhoe Bay, St. Marys and Unalakleet.

Q. Who heads up your company and who is on its senior management team?

A. Officers are Bill Fowler, CEO; David Karp, COO; Eric Van Andel, CFO; Stephanie Holthaus, vice president, cargo; Kevin Schlosstein, vice president, corporate services; and Jeff Landrum, vice president, maintenance.

Q. Describe any partnership arrangements and when they became effective.

A. We have had a successful joint venture with Kuukpik Corp. since 1998. Kuukpik has been with us through the years as we’ve operated our cargo fleet throughout the North Slope region.

Q. What is the company’s primary business sector? What services does the company offer?

A. Northern Air Cargo’s primary business has been transporting freight throughout the state. With its subsidiaries, Northern Air Maintenance Service, Northern Air Aviation Services, NAC Link and a variety of sister companies, we provide individuals and businesses with a full complement of transportation logistics services.

Q. Who are the company’s main clients?

A. NAC’s primary clients are the individuals and businesses requiring transportation service to and from rural Alaska. These include everything from a family in St. Marys buying a new sofa, to the Department of Defense providing critical provisions to a remote radar station. We serve the oil and gas, construction, mining, health care, and seafood industries as well as the United States Postal Service on a regular basis.

Q. How many employees does your company have?

A. NAC has approximately 320 employees with the majority residing in the Anchorage area.

Q. Does NAC have subsidiaries? If so, what services do they provide?

A. Yes. Northern Air Maintenance Service is a certified 145 repair station which provides maintenance services for almost any type of aircraft or airline. Most of our efforts in this division have been focused on a key client relationship with ConocoPhillips’ shared services. NAMS provides maintenance and facilities that support weekly multiple passenger aircraft operations for ConocoPhillips to and from the North Slope.

Northern Air Aviation Services provides ground handling services for passenger flights at the Anchorage International Airport. This includes passenger and ground handling services for the ConocoPhillips contract as well as Denver-based Frontier Airlines. Services include everything from passenger check-in and baggage handling to aircraft dispatch.

NACLink is a full-service freight forwarding company, working with clients to transport freight throughout North America in a timely and cost effective manner. NACLink will soon expand its services internationally.

Q. Describe your essential equipment in general terms.

A. NAC’s primary assets are cargo aircraft. We recently purchased three Boeing 737-200s and operate three Douglas DC-6s. NAC also has real estate holdings in Anchorage, Fairbanks and Bethel. Our fleet modernization and replacement strategy requires us to constantly be prepared for our next equipment acquisition.

Q. Is NAC expanding any of its operations and/or locations?

A. NAC constantly pursues better ways to serve Alaskans with outstanding service. Currently we are implementing several initiatives to improve and modernize our freight handling process with a renewed emphasis on recognizing the time constraints of our customers. Managing and tracking the flow of freight is absolutely crucial to our success. We’re constantly looking to make improvements in these areas. We are also in the final stages of opening a new contract freight facility that will allow us to focus on expansion of our contract freight services division. Currently NAC handles freight for United, Continental, Frontier, Hawaiian and soon Japan Airlines. The new facility is adjacent to the existing NAC facility on the airport ramp. Additionally, we are making multiple capital improvements to our existing facilities, focusing on modernization and operational efficiency.

Q. Is the company changing any of its services?

A. NAC has expanded its overall lift capacity with the addition of the Boeing 737s, which has resulted in increased flights throughout our system. We are absolutely focused on more frequency and improved schedule adherence. We are a service company. Frequency, reliability and superior service are the keys to our success.

Q. What is your company’s main strength, i.e. its edge over the competition?

A. Our main strength lies in our people. Providing customers with great service, in a timely and professional manner is what we do. We have many employees who have been with NAC for 10, 15 and 20 years. They are always there to assist with those fragile, hazardous, time sensitive, odd size and unusual shipments safely and professionally.

Q. Has the company invested in any new technology in the last two years?

A. We have made significant investments in this area in the last two years. Aside from our multi-million dollar fleet modernization initiative, we’ve also implemented new, cutting edge software systems for managing freight flows, flight operations, maintenance procedures and administration. Again, all of these initiatives are directed at improving the customer experience and the overall value of the product we provide.

Q. What are the biggest obstacles to completing work NAC undertakes?

A. The biggest obstacles we face are the weather and unique requirements of our customers, but we thrive on these challenges. We also operate in a very complex, closely monitored regulatory environment which requires attention to detail and organization. NAC has an outstanding safety record and the well being of flight personnel and all employees are absolutely the number one priority. More than 51 years of operating experience is contributed to almost every decision we make.

Q. What do you see as your company’s biggest challenge in the next five years?

A. It is an exciting time to be in the air cargo business, but the ability to develop and implement growth strategies will rely on doing things in the smartest way possible. This includes a concerted effort to operate and grow the company in a safe, ethical manner that meets the requirements of the complex regulatory environment we operate in. We want to operate a profitable company that our employees and our customers are proud of. We believe if we direct our efforts towards creativity, attention to detail, and regulatory compliance, any challenges can be overcome.

Q. What do you see as future trends or opportunities for your company from, say, political events or long-term weather fluctuations?

A. The continued development of Alaska’s rich natural resources represents a key area of emphasis for NAC. It’s no secret that these sectors are affected by many decisions and events outside of our control, both political and otherwise. As for long-term weather fluctuations, our five year strategic plan doesn’t quite contemplate palm trees on the North Slope, but understanding changes in weather and how it affects our operations is an ongoing effort. Bottom line, we are an optimistic group of hard working Alaskans, dedicated to helping develop industries that sustain the state’s economy.

Q. Does your company have an anniversary or other landmark event coming up?

A. NAC just celebrated its 50th anniversary last year — 1956 to 2006.We anticipate multiple landmark events in the near future.

Q. What is the average length of time employees remain with the company?

A. Many of NAC’s employees have been with the company for 10, 15 and even 20-plus years. The dynamic and operationally intensive nature of this business is what our employees thrive on. Their commitment to working in Alaska, providing essential services to Alaskans, is complemented by our continued commitment to operating in a professional, safe and rewarding business environment.

Q. Does your company or its partners or subsidiaries maintain Web sites?

A. Northern Air Cargo’s Web site: www.northernaircargo.com or www.nac.aero.



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