Nome residents roll along with higher fuel prices   

(Mark Thiessen/Bloomberg Businessweek, 29 March 2012) -- The measure of how challenging it can be to live in Nome, Alaska, starts with a dollar sign. There are plentiful, painful reminders all over this Bering Sea coastal community. At the grocery store, it's $39.25 for a 12-roll package of paper towels. Toilet paper costs $37.85 for a 36-roll package. Want a 2-liter of Diet Pepsi? It's on sale this week for $4.49. At a restaurant, breakfast for one will run about $16. And the price for a gallon of gas is well above the national average, at $5.96 a gallon. If there's any good news for the 3,500 residents of Nome, it's that gas is cheap compared to what it could have been. One of the two main fuel suppliers for Nome didn't have the last barge arrive before the Bering Sea froze for the winter. Bonanza Fuel considered flying in fuel from Anchorage, but the cost would have made gas prices jump to $9 or $10 a gallon. Instead, Bonanza arranged for a Russian tanker to make a 5,000-mile journey, and with the help of a U.S. Coast Guard icebreaker, it made the first-ever winter delivery by sea to Nome when it brought in 1.3 million gallons in early January. The painstaking delivery played out as a worldwide media drama. When the Coast Guard vessel Healy and the Russian tanker Renda sailed off, everyone waited to see where Bonanza would set the price of their fuel, fearful that Bonanza's parent company, Sitnasuak Native Corp., would pass on the costs. Sitnasauk CEO Jason Evans wouldn't disclose how much the international effort cost (they filed a $1.5 million lawsuit against the company that didn't deliver before the freeze, and have been countersued), but said market pressures dictated $5.96 a gallon, two cents below its competitor. "It could have been a lot worse," Mayor Denise Michels said from her City Hall office, located on the site where Wyatt Earp -- he of Gunfight-at-the-OK-Corral fame -- owned a bar during Nome's heady gold rush days. For the hardy residents of Nome, high prices are just a way of life.

Posted 2 April 2012; 3:53:54 PM.   Permalink

Tagged: Alaska, Communities, Economic issues, March12