Spokane Journal of Business

Firm here to handle Russian jobs

Pacific Energy will conduct energy-related studies at Magadan, Sakhalin Island

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A small consulting firm here called Pacific Energy Research Associates Inc. has been awarded two contracts to conduct energy-related planning and feasibility studies in eastern Russia that could have major implications.

Under one of the contracts, Pacific Energy will manage a demonstration test burning of 20,000 tons of U.S. coal exported from Alaska to an 800-megawatt power plant in the city of Magadan, says Gerry Snow, the firms president. As part of that project, the firm also will study opportunities for the possible use of U.S. equipment to improve the operating efficiency and environmental performance of the power plant, he says.

Under the second contract, Pacific Energy will team up with other consultants to prepare a long-range infrastructure-development plan for Russias Sakhalin Island, located north of Japan, Snow says.

We expect the (Magadan) test burn and feasibility study to result in the first-ever, long-term contract to export U.S. coal to Russia. In addition, the project will lay critical groundwork for future exports of U.S. energy and environmental technologies to this important region, he asserts.

Pacific Energy is participating in the $1.2 million Magadan project with Usibelli Coal Mine Inc., of Healey, Alaska; Alaska Russia Consultants LLC, of Anchorage; and the Russian utility MagadanEnergo, Snow says. The project is being funded by Usibelli, the Magadan Regional Government, and the U.S. Trade & Development Agency, which provides funding to projects that have significant long-term export potential.

Magadan is a regional port located at the north end of the Sea of Okhotsk. The region is rich in timber and mineral resources and is a center for commercial fishing. Russia has significant coal reserves, as well as oil and natural gas, for electric-power generation, but the energy infrastructure in that area is not well-developed, Snow says.

Although coal accounts for more than 45 percent of the regions electrical power generation, the coal sent there from Russian mines usually is inferior in quality, and shipments are irregular, he says. Those problems have worsened in recent years, due partly to aging, inefficient coal mines and safety concerns, he adds.

According to our studies, U.S. coal can be reliably and economically transported from Alaska to this growing market, says Snow. We also hope to demonstrate significantly lower pollutant emissions, including CO2 (a significant greenhouse gas), as a result of the switch to Alaskan coal at the Magadan plant.Sakhalin projectFor the $550,000 Sakhalin project, Pacific Energy will do the energy-related consulting work on the islands long-range development plan, and other members of the consulting team will be responsible for other components, such as water and sewage, transportation, and environmental protection, he says.

Sakhalin Island is located near the southern end of the Sea of Okhotsk, about 700 miles southwest of Magadan. The island has captured considerable attention from multinational companies recently due to the discovery of large petroleum and natural gas reserves there. Several companies have negotiated product-sharing agreements with the Russian government, and a number of multibillion-dollar projects are in the early stages of development there, Snow says.

A native of Spokane, Snow operates Pacific Energy out of his South Hill home and is the firms only full-time employee, although he contracts with other consultants as needed. He started the firm in 1995, and says he hopes eventually to move it to a downtown office location and to build it up to five to 10 employees.

Pacific Energy offers specialized services to the industrial-power and electric-utility industries, including strategic planning, project development, feasibility analysis, system improvement, and due diligence asset evaluations for clients that are interested in investing in major power systems.

The firm already has completed projects in Eastern Europe, Russia, Kazakhstan, Korea, and England, as well as in the U.S., Snow says. Close to home, it currently is working on a project at Washington Water Power Co.s Kettle Falls generating plant that seeks to boost the plants operating efficiency, he says.

Snow received bachelors and masters degrees in mechanical engineering from Gonzaga University and Washington State University, respectively. He worked in California for several years, doing energy-related research and development work, before accepting a three-year position in England with the International Energy Agency to assist in the development of advanced energy technology. He and his family moved back to Spokane in 1991.

Kim Crompton
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