SITKA — Alaska Bulk Water Inc. is asking the city of Sitka to extend its contract as it looks to provide bulk water to prospective purchasers in California, Mexico and the Middle East.
The board of directors of Gary Paxton Industrial Park voted unanimously Thursday to recommend that the Sitka Assembly extend the bulk water company's contract to December 2018. If approved, the extension would pour another seven figures into the city's raw water fund.
The contract extension would also push Alaska Bulk Water's total investment into Sitka to $2.35 million, the Daily Sitka Sentinel reports.
The company paid $1 million in 2012 to secure the rights to the water. In the agreement, the company was required to ship 50 million gallons by December 2015 to retain the exclusive rights. The company has yet to send a shipment out of the park, but CEO Terry Trapp said that has been due to problems on the receiving end.
Trapp said now things are looking up as the company is in discussions with a number of potential customers including beer brewers in Mexico, drought-stricken Californians and a country in the Middle East that wants a regular annual delivery of 5 billion gallons.
"The reason we are asking for a contract extension now is that the customers we are negotiating with want to make sure that we're going to be able to supply water on a long-term basis," Trapp told the board of directors.
Industrial Park director Garry White said the sale of bulk water remains a new venture, but that Trapp's company has made more progress than others. He said that he and Alaska Bulk met with a group from Iceland that is also looking to sell their water.
"I gotta say that we are way ahead of them," White said.
The contract with Trapp's company will now go before the Assembly for approval. For the deal to be secured, Sitka must receive another $1 million by Dec. 8.
While the contract extension is costly, especially with no sales, Trapp said he isn't worried.
"You gotta believe that we believe," he said.