A new airline wants in on North Slope

A Native-owned company wants to compete with long-time air carriers in Alaska by running a privately chartered jet from Anchorage to the North Slope oil fields and possibly other places in Alaska.

But in recent months, the firm, Polar Express Group, has run afoul of the state's largest commercial carrier, Alaska Airlines.

The companies have been battling over who will get to tap into the market for private-jet chartering of oil field workers -- and possibly other commuters -- to and from the Slope.

Airlines such as Alaska Air and Peninsula Airways say they've got the North Slope covered.

They've apparently won the first round, despite ample support for the Polar Express venture from oil companies and Alaska politicians.

Polar Express is waiting for federal permission to run a 100-plus-seat jet -- owned by Sky King Inc., a California-based company that charters private airplanes in the Lower 48 -- to and from the Slope.

During the wait, Polar Express lost out on some charter contracts, the company's president, Andy Baker, said. His company remains interested in doing business on the Slope and possibly other locations, he said.

"We're going to make something work," Baker said.

In recent months, attorneys for Polar Express, Sky King and Alaska Airlines waged a fierce, sarcasm-laced battle in legal filings over the Polar Express venture.

Attorneys for Sky King accused Alaska Airlines of trying to smash its competitors and behaving as if it's "Alaska-omnipotent."

Alaska Air attorneys challenged Polar Express' and Conoco Phillips' credibility, telling regulators at the federal Department of Transportation -- which must OK the new service -- that the two companies incorrectly claimed an "emergency" lack of flight service this summer on the North Slope.

Two of Conoco's private jets transporting workers to and from the Slope were grounded in August for repairs.

The day after Conoco Phillips wrote an Aug. 2 letter in support of Polar Express, citing the jet grounding, Alaska Air called Conoco at least 15 times to negotiate ramped-up service for the oil giant, according to the airline's legal briefs to DOT.

The end result was there was no emergency, according to Alaska Air.

Conoco ended up chartering temporary charter flights with Alaska Airlines, according to the oil company's Alaska spokeswoman Natalie Knox Lowman.

THE PROPOSAL

In July, Polar Express asked the DOT for permission to use privately-chartered Boeing 737 jets, staffed with Alaska-based flight crews, to operate nonstop flights between Deadhorse and Anchorage.

Polar Express is owned by Kuukpik Corp., the Native corporation for the Arctic village of Nuiqsut, and JLE, an Anchorage aviation research and development firm.

The proposal was filed in the form of an "emergency waiver." Polar Express asked for a quick decision from the regulators so it could begin operations in August.

Gov. Sarah Palin, some North Slope residents, and a handful of oil companies, small and large, wrote letters supporting Polar Express during the summer. Palin's letter said she supports "sound proposals that will allow healthy competition."

Two of Alaska's members of Congress, Sen. Lisa Murkowski and Rep. Don Young, applied additional pressure. They asked DOT on several occasions to make a quick decision, though they said they were neutral on the proposal.

"It has been brought to our attention that the review process seemingly has stalled with no definite timeline in place for a decision," Murkowski and Young complained in a joint letter to the DOT on Aug. 21.

U.S. Rep. Doris Matsui of California also weighed in with the DOT. She intervened on behalf of Sky King, based in Sacramento, Calif.

In recent letters to Alaska political leaders, a DOT deputy secretary said the department is "working as expeditiously as possible" on the application.

THE EXEMPTION

Polar Express needs permission to operate charters in Alaska because of a federal rule that protects longtime Alaska air carriers from new competition.

The rule blocks any company formed after 1977 from chartering in-state flights unless federal regulators determine that the flights are justified for "public convenience and necessity."

While some critics say the rule stifles competition and benefits special interests, it maintains the stability of flight service to locations throughout Alaska, some airline executives said this week.

"Aviation in Alaska has always been very fragile. ... It's a delicate balance between competitors," said Danny Seybert, president of Peninsula Airways Inc.

He said he believes there's more than enough air carriers on the Slope to meet oil industry demand.

"If a new company started, they'd have to take traffic from us," he said.

The companies now offering flights out of Deadhorse include Alaska Air, PenAir, Frontier Flying Service, and Conoco and BP's private jet company, Shared Services Inc.