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Kenai is named after the Kenai Peninsula. The name Kenai is probably derived from Kenayskaya, the Russian name for the Cook Inlet and translates to "flat, barren land". Or, it could refer to the Inuit word kenai (black bear).

Archaeological evidence suggests that the area was first occupied by the Kachemak people from 1000 B.C., until they were displaced by the Dena'ina Athabaskan people around 1000 A.D.

Before the arrival of the Russians, Kenai was a Dena'ina village called Shk'ituk't, which means "where we slide down." When Russian fur traders first arrived in 1741, about 1,000 Dena'ina lived in the village. The traders called the people "Kenaitze," or "Kenai people."

In 1791, a Russian trading post, Fort St. Nicholas, was constructed in the middle of the village for the purposes of fur and fish trading. It was the second permanent Russian settlement in Alaska.

The establishment of shipping companies in the early 1900s broadened Kenai into a port city. Canning companies were established and helped fuel the commercial fishing boom that was the primary activity through the 1920s. In 1937, construction of the Kenai Airport began.

In 1940, homesteads were opened in the area. The first dirt road from Anchorage was constructed in 1951; pavement would not arrive until 1956 with the construction of the Kenai Spur highway.

A military base, Wildwood Army Station (later Wildwood Air Force Station), was established in 1953 and served as a major communications post. Wildwood was conveyed in 1974 to the Kenai Native Association in partial settlement of Alaska Native land claims. The facility was leased and later purchased by the State of Alaska and presently serves as the Wildwood Correctional Complex.

In 1957, oil was discovered at Swanson River, 20 miles northeast of Kenai. This was the first major oil discovery in Alaska. In 1965, offshore oil discoveries in Cook Inlet caused a period of rapid growth.

 

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