As speculation continues, Sitka finds wealth in water rights

The state granted Sikta a permit to export more than 9 billion gallons of water per year from Blue Lake. (Photo courtesy of Flickr / Creative Commons user thedamian)

Although Sitka’s dreams of selling bulk water on the world market haven’t amounted to anything, the community has made quite a bit of cash not selling water.

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Garry White told the Sitka Chamber of Commerce that Sitka has made almost $1.5 million dollars selling water rights.

And he’s still getting calls.

Sitka has an enormous storage tank for water, White said to a full house at the Chamber of Commerce. It’s called Blue Lake. The reservoir now supplies the bulk of Sitka’s hydroelectric needs, and all of the community’s drinking water, with about 9.5 billion gallons to spare.

This 24-inch manifold, which can deliver 1 million gallons of water an hour, is located next to a new floating dock at Sitka’s Gary Paxton Industrial Park. Outfitted with extended dolphins, the dock could accommodate a Panamax ship. Park director Garry White thinks the pipeline, plus the new dock, could be a game changer for bulk water at the park someday. (KCAW photo/Robert Woolsey)

Since 2009, a succession of entrepreneurs and speculators has paid to reserve the right to export that excess water, but none, to use legal terms, has performed.

“And we haven’t sold a drop of water (audience laughter). But it’s been such a competitive thing that folks have paid us money to have the right to have a contract to export water,” White said.

The total is about $1.5 million so far, with another $90,000 due from the latest player, Arctic Blue Water Alaska, Inc. The day after the chamber luncheon, White notified the board of Sitka’s industrial park that Arctic’s payment was overdue, and the company will have 45 days to pay or the contract would be cancelled. White told the board, “They’re probably going to come up with the cash.”

So why do investors keep coming back to Sitka’s water? Clearly, there are catastrophic water shortages occurring in places like Cape Town, South Africa, but no one’s found an economically viable pathway for using Sitka’s surplus to address shortages in other parts of the world. Factoring in shipping costs, which White says can be about $.03 per gallon, desalination technology becomes more affordable.

Nevertheless, White describes desalinated water as chemically “dead.” He told the chamber that there are businesses who see a different niche for Sitka’s water.

“Right now I’ve been having conversations with a group out of Costa Rica. The interesting thing is that they actually market water with high-end coffee and tea. And someone’s willing to pay for this. I don’t know who is. I mean, I buy my coffee at a gas station,” White joked. “But some people like the high-end coffees and they’re willing to pay for a high-end water to go with their coffee. And the reason that he called us from Costa Rica is that the ideal pH for coffee water is 6.9. Our water has a pH of 6.9. Apparently we have great water for coffee. We also have a really low dissolved solid content in our water, which also makes it really great for coffee, and for drinking overall.”

Just recently the contractor completed work on a new 250-foot floating dock at Sitka’s industrial park, adjacent to the 24-inch bulk water line that could conceivably load a Panamax cargo ship one day. White thinks the dock will be a game-changer, once the economics of water have been resolved.

“Someday I’m still convinced that we’re going to be able to sell our water,” White said, “But it won’t be this year.”