Part 1: Alaska struggles with its soul Part 2: Centuries of tradition...and a televised disaster Part 3: A North Slope gusher bring a 'pointy shoe' invasion Part 4: A whiff of petroleum, and burial by paperwork Part 5: 'The good life is what Alaska is all about' Part 6: Wildlife, wealth...and an illusion of changelessness Part 7: The damage done... Stories by Ross Anderson, Bill Dietrich and Mary Ann Gwinn

A whiff of petroleum, and burial by paperwork

If the Arctic represents the future of oil in Alaska, the Kenai Peninsula represents oil's past.

Half the Kenai Peninsula fits the image of picture-postcard Alaska: rugged mountains, sprawling ice fields, lush meadows and scenic harbors. The other half, where most of its people live, is a rolling, boggy, lake-spotted expanse of scrub forest and gravel cut by salmon-rich rivers.

The big peninsula, lying south of Anchorage, east of Cook Inlet, also is home to the oldest working oil complex in the state. Wells dot the 2 million-acre Kenai Wildlife Refuge and Cook Inlet. There are two refineries, the world's biggest fertilizer plant and a liquefied natural-gas plant. Thirty percent of the peninsula's work force is paid by oil.

"The oil industry controls everything here," said Mary Sisson.

Cliff and Mary Sisson own 10 acres that they hoped to develop into a campground, a dream of cashing in on tourism, a major Alaskan business that depends on the state's image as a pristine place. The dream died with the faint whiff of petroleum that came from their water supply.

After a siege of vague but persistent illnesses, the Sissons stopped drinking and bathing in their well water. Mary buys bottled water to drink and fills jerry cans at a nearby fire station for laundry and showers.

Lab tests have failed to confirm contamination and, in any event, its source is unprovable. But the Sissons and other critics have a candidate: the uncounted millions of gallons of drilling wastes and oil-field chemicals — 30 years' worth — that sit atop the peninsula's shallow water table.

Until recently, complainers like the Sissons were considered gadflies, with Kenai Borough Mayor Don Gilman calling them the "radicals of the radicals." Traditionally, residents have been hostile to environmental regulation, and the Kenai Borough has no zoning outside its cities. But even boosters such as Gilman are having nagging doubts about the long-term impact of oil on the Kenai.

"Technically, we're a wetland," Gilman said, "and there has been evidence of water contamination in certain areas." Expensive cleanups have begun. The state has identified 40 different dumps, and it is spending $1 million a year to assess groundwater contamination.

"We've had an attitude in Alaska for a long time: `By God, I'll do what I want to do,' " said Gilman. "`The state is too big. We're not going to be like New Jersey. There is too much land for that to happen.'

"Now," he said, "we're seeing that's not necessarily the truth."

Oil is cheap and useful. But it is hazardous to transport, pollutes the air when burned and persists as plastic. Oil fields are inescapably messy. Spills from pipes and containers are chronic and, on the North Slope, add up to 250,000 gallons a year.

An oil well may be three miles deep, and the resulting rock debris, unwanted subterranean water and lubricant called drilling mud - which contains salt and heavy metals — can form a huge disposal headache. Well waste can run from 35,000 to 45,000 barrels and is stored in reserve pits. There are more than 250 of these pits on the North Slope and an uncounted number of the Kenai Peninsula, which has about 300 oil and gas wells.

The face-off continues over how dangerous these muds are. Environmentalists consider them hazardous. Reserve pits have leaked and killed patches of tundra on the North Slope, and in the Lower 48 the muds may be linked to high incidences of cancer in oil states such as Louisiana. However, Congress has tentatively exempted the drilling muds from hazardous-waste rules. In 1987,the Environmental Protection Agency concluded the toxicity of the muds was low enough, and the volume huge enough, that regulation of the pits as hazardous waste was impractical.

Belatedly, the oil industry has moved to mute the criticism. On the Kenai Peninsula, Marathon Oil has proposed a central drilling-waste disposal facility. Well debris would be barged across Cook Inlet, away from populated areas. The industry is cleaning up other Kenai messes, including a poorly regulated hazardous-waste disposal site at Sterling and PCB-laden oil dirt sprayed on roads for dust control in the national wildlife refuge.

Yet despite such intrusions on the refuge, managers say oil has not been an incompatible neighbor for the past 30 years. It's an attitude that reflects the tolerance for oil development in much of Alaska.

"I don't think anybody could make a (court) case that there have been adverse consequences," said Dan Doshier, superintendent of the wildlife refuge. "The oil industry is not perfect. The refuge is not pristine." But water pollution has not shown up in the Swanson River, he said. Moose sometimes calve next to oil-field offices, perhaps because predators avoid the area.

"In my experience here, the oil industry has been responsive," Doshier said.

A few hundred miles away, Dan Lawn would disagree about the industry's responsiveness.

Until he was recently reassigned to draw up a new oil-spill plan for Alaska, Lawn was chief of the Valdez office of the Alaska Department of Environmental Conservation. His office is an archive of omens — memoranda and letters written over the years about lack of preparedness for an emergency, and about how overmatched his tiny band of regulators was by the oil industry.

In May 1984, almost five years before the Exxon Valdez ran aground, Lawn wrote his agency:

Over the past several months, there has taken place a general disembowelling of the Alyeska Valdez Marine Terminal operational plan.

Not only have there been severe personnel cuts, but operational plans and routine maintenance have been reduced drastically.

Morale is at an all-time low, and the majority of knowledgeable and competently trained individuals have either quit, been terminated or transferred up the line. What this has done is left inadequately trained people to maintain the facility and an insufficient number of people to operate it.

As you know, (the Valdez office) has been under-budgeted and under-staffed to adequately inspect the terminal and keep in touch with their day to day operations. Unfortunately, this has been a signal to Alyeska that the state is no longer interested in the TAPS (trans-Alaska pipeline) project . . .

Lawn is a tough guy, hardened by his years of contending with the oil industry, and able to sustain 20- and 22-hour work days after the spill. He came to Alaska to work on the pipeline as an engineer, but stayed to watchdog its operator, Alyeska.

"They eat you up with the paperwork," he said of the oil companies he tries to regulate. "They dump reams and reams and reams of stuff on you. You need the support, and you need the people to do the work."

The Legislature was generous with neither people nor support. Before the spill, Lawn's four-person staff covered an area 100 miles to the north, 80 miles to the west, 120 miles to the east and 300 miles to the south of Valdez. In addition to the oil terminal, the four were responsible for pollution problems, hazardous- and solid-waste disposal, drinking-water safety and restaurant inspections.

Lawn was one of the first officials to reach the Exxon Valdez after its hull ripped open on Bligh Reef. The small boat he shared with the Coast Guard had to duck in on the starboard side to avoid the churning outrush of oil. That night he stood on the bridge and called Alyeska Pipeline Service Co. again and again. Oil was erupting from the hull like a mud volcano. Where were the skimmers? Where was the containment boom? Lawn had spent many minutes cooling his heels, waiting for permission to inspect Alyeska facilities. It was a familiar feeling — waiting on Alyeska.

Unknown to Lawn, the company's oil-response barge still had a hole in it from a storm two weeks before. It had been unloaded of spill equipment for repairs. Employees had scattered for a three-day Easter holiday weekend. Contingency plans called for the first response vessels to reach the ship in three hours and skimmers in five. Nothing appeared for 14 hours.

The waiting would go on. The plan called for dispersing the oil with chemicals, but there was little dispersant and no aircraft ready to spray it. The plan called for burning the oil, but there was no fireproof boom. The plan called for skimming the oil, but there weren't enough skimmers to make more than a tiny dent . . .

"We are all to blame," Lawn would say later. "We demand petroleum products, but we're unwilling to be taxed. We thought someone was taking care of it. We put in pro-industry officials, and our ability to control things went away."

For three days after the spill the weather was clear and bright, almost supernaturally calm. It was if nature held her breath as Exxon struggled to find equipment. Sunday night, the oil company announced to assembled reporters that it was finally ready to begin the cleanup of the slick.

Then a storm came and the oil was gone, blown beyond easy recovery, swept by the wind a hundred miles away and even hurled by the surf into trees.

Part 3 · Part 5