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      This is your public service 1-stop-shop for Alaskan and Canadian Arctic energy commentary, news, history, projects and people. We update it daily for you. It is the most timely and complete northern energy archive anywhere — used by media, academia, government and industry officials throughout the world. Northern Gas Pipelines may be the oldest Alaska blog; we invite readers to name others existing before 2001.  -dh


April 2012 Archives


09 April 2012 2:18am

We added a new Sub-Tab, above, under 'Archives' for "Northern Gas Pipeline History".    It provides historical perspective from the Canadian Broadcast Corporation, the Alaska Gas Pipeline Federal Coordinator's office and from our own magazine and newspaper articles.  -dh

TODAY IN ANCHORAGE, U.S. Sen. Mark Begich (NGP Photo)U S Senator Mark Begich, Arctic Deepwater Port Roundtable, ARCAC is hosting an Arctic Deepwater Port Roundtable discussion with Alaskans to discuss how increased marine traffic and economic opportunities in the changing Arctic will create a need and demand for an Arctic port in Alaska.  In the discussion with representatives from federal agencies, Alaska Native Corporations, and the shipping industry, Sen. Begich will outline some of the work he has done as chair of the Senate Commerce Committee’s Subcommittee on Oceans, Atmosphere, Fisheries and Coast Guard, consideration of the Fiscal Year 2013 budget and future budgets as additional authorizations will be needed from Congress to move forward on Arctic infrastructure.   The roundtable is scheduled for Monday, April 9 from 3 to 4 pm at the Alaska Native Science and Engineering Program (ANSEP) Atrium, 311 Providence Drive, on the campus of UAA.   


The LegHead Report by Maggie Wall.  If AlaskaMike Chenault, Alaska Speaker of the House, Photo by Dave Harbour legislators want to see a natural gas pipeline built, it’s time to get a project on its way. That was the gist of House Speaker Mike Chenault’s (NGP Photo) comments to the Alaska House last week where he gave an impassioned speech in support of House Bill 9 which he sponsored to move a gasline forward.  

Juneau Empire by Pat Forgey.  Alaska will bring in more than $10 billion in oil revenue during the current fiscal year, as record high oil prices continue to pump money into state coffers.  That’s a billion dollars more than was projected during the Department of Revenue’s last forecast, and $2 billion more than was brought in last year.

Globe and Mail (4/7/12) reports: The debate about climate change and its impact on polar bears has intensified with the release of a survey that shows the bear population in a key part of northern Canada is far larger than many scientists thought, and might be growing…The number of bears along the western shore of Hudson Bay, believed to be among the most threatened bear subpopulations, stands at 1,013 and could be even higher, according to the results of an aerial survey released Wednesday by the Government of Nunavut. That’s 66 per cent higher than estimates by other researchers who forecasted the numbers would fall to as low as 610 because of warming temperatures that melt ice faster and ruin bears’ ability to hunt. The Hudson Bay region, which straddles Nunavut and Manitoba, is critical because it’s considered a bellwether for how polar bears are doing elsewhere in the Arctic.  (More below)


4-8-12 - The Kentucky Derby Draws Closer!

08 April 2012 8:48am

Personal Comment: Once againKentucky Derby Hat and Love Scene, Churchill Downs, Derby Hats, Photo by Dave Harbour we draw attention of our readers to the Kentucky Derby occurring this year on May 5 at Churchill Downs.  We have covered the Derby in previous years and following this year's event will be releasing thousands of race, fashion and behind the scenes photos (Dave Harbour World Photography Samples) for editorial and art use and for creation of a wonderful, new coffee table book.  Astute readers know that this magnificent event is unrelated to Northern Gas Pipelines--though we value it for being one of the Nation's enduring cultural and iconic celebrations culminating in the "Greatest Two Minutes in Sports".  We'll bring you more in May!  -dh

Andrew Halcro, Alaska LNG Project, Photo by Dave HarbourAlaska Dispatch by Andrew Halcro (NGP Photo-L).  Last Friday Governor Sean Parnell announced the three major oil producers on Alaska's North Slope will come together to study an LNG line for export to Asian markets. Does that mean our ship is about to come in?

ADN by Tim Bradner (NGP Photo). Tim Bradner, Alaska oil and gas, Photo by Dave Harbour Gov. Sean Parnell deserves a pat on the back for bringing to closure the contentious Point Thomson gas field lawsuits. Those were big clouds hanging over a major North Slope gas project. Point Thomson has almost one-fourth of the gas reserves on the Slope, and resolving uncertainties over its ownership is necessary for an eventual gas project.

Petroleum News Alaska by Kay Cashman.    Brooks Range Petroleum Corp. has proved up a 40 million barrel discovery on Alaska’s North Slope; that’s 40 million barrels of recoverable oil, which can be expected to produce for 15 years, yielding 13,500 barrels of oil per day at its peak.


07 April 2012 8:55pm

ADN by Steve Haycox (NGP Photo).  2012 marks the 100th anniversary Steve Haycox, university of alaska, history of alaska, territorial legislature, 100th anniversary of alaska territorial legislature, photo by dave harbourof the establishing of the Alaska Territorial Legislature.  

AP by Becky Bohrer.  The state of Alaska may decide this week to give TransCanada Corp. permission to shift its attention to a building liquefied natural gas pipeline, capable of facilitiating overseas exports.

AP by Becky Bohrer.   A Senate plan representing a structural shift in Alaska's oil tax system wouldn't effect the kind of meaningful change....



06 April 2012 7:28am

On Tuesday, Alaska Commissioner of Natural Resources Dan SullivanDan Sullivan, Commissioner, Alaska Department of Natural Resources, AG, Oil Taxes, Gas Pipeline, Producer Alignment, Photo by Dave Harbour(NGP Photo) addressed a group sponsored by Northrim Bank.  Yesterday morning, Sullivan spoke to the Resource Development Council for Alaska.  Since the messages are similar, we will provide readers with a brief report of the Tuesday presentation later this morning....

Bloomberg  by Gene Laverty.  Canadian natural gas fell amid expectations that U.S. inventories of the fuel rose for a third straight week.  Alberta gas declined 2.3 percent. Stockpiles probably rose 33 billion cubic feet last week, the median of 31 analyst estimates compiled by Bloomberg (DOENUSCH). The increase has averaged 8 billion in the past five years, according to U.S. Energy Department (DOENUST5)data.
Town Hall: Are We Really Helpless When it Comes to Gas Prices? **Op-ed by Michael Whatley**
With gas prices at record highs for this time of the year, it’s no wonder there’s been rhetoric from politicians on both sides of the aisle on how to reduce fuel prices. It seems the right and the left have been scrambling to find a silver bullet solution, simultaneously pointing fingers and deflecting blame.
Offshore drilling fees are financing the purchase of $41.6 million worth of new national forest lands in 15 states. Agriculture Secretary Tom Vilsack said Thursday the 28 different purchases from North Carolina to Oregon will protect clean water and fish and wildlife habitat, absorb private inholdings within wilderness areas, and support outdoor recreation spending that contributes $14.5 billion annually to the economy.
At least one public hearing is scheduled in Nebraska for the Keystone XL pipeline before a route is determined, a state proposal says. Nebraska lawmakers last week, by a 35-to-2 vote, approved a preliminary measure that would let TransCanada move ahead with a $2 million study to find a new route for the Keystone XL pipeline through the state.
President Obama recently got a look at what his failed energy policies are doing to America and I hope he fully appreciates that he does have the power to change things for the better. His recent tour of Cushing, Oklahoma, while a trip planned with political considerations first and jobs other than his own a distant second, should have given him a clear perspective of how important the Keystone XL Pipeline is to America.
House Speaker John Boehner (R-Ohio) used Friday’s mixed jobs report as fuel for attacks on President Obama's energy policies. Boehner twice mentioned high gasoline prices in a statement on the jobs numbers and pushed GOP plans to authorize construction of the Keystone XL oil sands pipeline.
Gasoline prices are holding steady just under $4, but analysts warn Houston drivers could see a sudden rise at the pump as refineries switch to summer-blend gasoline. Houston drivers are paying on average $3.89, or 3 cents higher than a week ago, but Tom Kloza, the chief analyst for Oil Price Information Services, said higher prices are on their way. “The big increases are coming to the Clean Air Markets, such as Houston and Dallas,” Kloza said.



05 April 2012 3:27am

E&E News: Cost of producing Arctic oil and gas remains well above market prices

Last week, federal regulators approved Royal Dutch Shell PLC's plan to begin exploratory drilling off the north coast of Alaska. A year ago, Exxon Mobil Corp. entered into partnership with Rosneft, the Russian state oil company, to explore for oil and gas in the Arctic Kara and Black seas. From China to Norway, nations are moving to assemble fleets of icebreakers capable of penetrating the far north. Is the race for the Arctic's vast mineral resources finally on?
A U.S. tight oil revolution is under way, and its effects on imports and foreign policy will be determined by the price of oil, gasoline demand and infrastructure bottlenecks, economists say. Estimates of U.S. oil production by 2030 varied greatly at a conference on tight oil earlier this week in Washington organized by the United States Association for Energy Economics.
Clean-energy companies may benefit from a new political-action committee trying to bridge a policy divide that is playing out in ads featuring Solyndra LLC’s collapse and finger-pointing over high gasoline costs. The Accelerating Energy Leadership, or Accel, PAC will help candidates who support “diversifying American energy sources,” which includes solar and wind power, biomass, nuclear and natural gas, according to an invitation to its inaugural event last month.
The unemployment rate was falling and President Obama’s poll numbers were improving, but along came $4 gasoline. Voters are giving Mr. Obama an emphatic thumbs-down for his handling of gas prices — 68 percent disapprove of his response to the problem in the latest Reuters/Ipsos poll.
The U.S. government has been under pressure to reduce rising gas prices. As a result the Obama administration has recently announced new procedures to speed up the drilling process for oil and gas companies drilling on public lands. With the faster drilling process implemented companies will be able to start drilling faster and more frequently benefiting companies in the Oil & Gas Equipment and Services Industry.
House Democratic leaders on Wednesday amplified their attacks on Wall Street oil traders, arguing that excessive speculation — not a lack of supply — is to blame for skyrocketing prices at the pump. With gas prices tickling $4 per gallon nationwide, the Democrats are trying to counter Republican accusations that President Obama's energy policies are behind the rapid cost increase.


04 April 2012 4:49am

Bloomberg by Colin McClelland.  Canadian natural gas rose as U.S. nuclear generation climbed from near a 10-month low and cooling demand approached double normal levels in parts of the South.


Alaska's Economy Is Threatened By Federal Administrative Actions and By the Alaska State Senate's Inaction.  Below Are Today's Examples of Both.

Comment on Federal Actions:  Congressman Doc Hastings' (NGP Photo) officeCongressman Doc Hastings, Alaska, Ocean Policy has been relentless in its effort to stop the Obama White House's end run around Congress' intent and authorizations.  One of the flagrant abuses of of the President's office has been created by Executive Order without Congressional mandate or budget approval.  This presumptuous and treacherous action is misusing existing agency personnel and budgets to create a nightmarish web of new regulations and prohibitions affecting the use of our oceans, the watersheds feeding them and on-shore activity adjacent thereto.  In short, Obama would Zone America as the White House sees fit.  He plans to fully implement the plan in the next few weeks.  Combined with the Obama administration's other assaults on Alaska's economy, this particular initiative could signal serious if not mortal blows to Alaska's various oil, mining, tourism and commercial fishing industries.  Thanks to the diligence of Doc Hastings, this job- economy- and freedom-killing initiative may be short-lived.  He is now attempting to forbid using federal budgets established for other purposes to be misdirected to the ocean zoning effort.  Since Alaska has most of America's coastline, this presidential assault on free and traditional uses of our oceans and waterways would have a greater impact on Alaska than any other state or region.  Accordingly, Chairman Hastings' labors are more beneficial to Alaska than to any other single state or region, though his own tidewater state of Washington (depending on Alaska as it does) will also be an important recipient of the Chairman's effort.   See the Chairman's latest actions below to defend America against Presidential overreach.  -dh

  • House Natural Resources Committee Chairman Doc Hastings (WA-04) sent a letter yesterday to Appropriations Committee Chairman Hal Rogers (KY-05) asking that each appropriations bill include language to prohibit the use of funds for the implementation of President Obama’s ocean zoning and National Ocean Policy.
  •  WASHINGTON, D.C. – Yesterday, the Natural Resources Committee held an oversight field hearing Anchorage, Alaska on, “Alaska’s Sovereignty In Peril: The National Ocean Policy’s Goal to Federalize Alaska.”  The hearing focused on how President Obama’s plan to mandate ocean zoning through implementation of the National Ocean Policy threatens Alaska’s sovereignty and economic livelihood.  “Nowhere in the United States will the effects of the National Ocean Policy be felt to the extent that it will in Alaska.  The reach of this ‘ocean’ policy will stretch throughout the entire state and affect almost any activity that requires a federal permit.  As we will hear from our witnesses today, the State’s economic vitality is a direct result of our ability to use our natural resources.  Any new federal initiative that affects our ability to use these natural resources will cost jobs,” said Rep. Don Young(AK-At large).  (Complete story below.)
  • House Natural Resources Committee Chairman Doc Hastings (WA-04) yesterday issued the first subpoena to the Department of the Interior for documents related to a more than year-long investigation into why an Obama Administration report that recommended a six-month drilling moratorium in the Gulf of Mexico was edited to make it appear as though the moratorium was supported by a panel of engineering experts when in fact it was not.
  • House Natural Resources Committee Chairman Doc Hastings (WA-04) released the following statement after Department of the Interior Secretary Ken Salazar announced a new electronic lease sale tracking system for onshore federal oil and natural gas production.  “Better government efficiency is certainly positive, but the real problem over the past three years of the Obama Administration isn’t slow computers but policies that punish and discourage American-made energy on federal lands."

ADN by Richard Mauer.  JUNEAU -- A new version of the Senate's oil tax bill showed up in the Senate Nero Fiddles While Rome Burns, Alaska Oil TaxesFinance Committee on Tuesday, offering more money to producers when oil prices are high than the state's current tax regime.  (Our comment on State Senate Inaction: It's a little late to be introducing a whole new tax reform bill near the eve of adjournment.  The Senate would have been better advised to work on the tax reform bill passed by the House last year, HB 110.  Hearings will occur tomorrow and the Senate Finance Committee plans more "work" on it over the Easter weekend.  Assuming it passes the Senate, it then goes on to the House which one assumes will not concur.  That either kills the 2012 tax reform effort or results in an 11th hour, end-of-session conference committee along with a significant amount of last minute horse trading and a chaotic, unpredictable outcome.  We can only surmise that while a majority of Senators and House Members were happy to enact Alaska's predatory and overreaching production tax after brief deliberation in 2007, Senate leadership has used "thoughtful deliberation" as an excuse for delaying action on tax reform for over two years, now.  Meanwhile the Trans Alaska Pipeline System throughput decline continues, introducing the historical specter of Nero frantically fiddling while Rome burns.   Our position: it doesn't matter who sponsors a bill or what its number is.  What matters is that it holds promise for reversing the TAPS decline.  Last year's House bill offers that promise.  This year's Senate bill is, so far, the mere illusion of a promise that has consumed untold productive hours of public and private time as the production decline continues.  -dh)

Consumer Energy Alliance News Clips:

Inside Climate News: Opponent of Clean Fuels Standard Fires Warning Shot at Attorneys General **CEA mentioned in article**
One of the country's biggest opponents of low-carbon fuel standards has fired a warning shot at attorneys general of Northeast and mid-Atlantic states, cautioning that a mandate requiring cleaner fuels would bury their states in costly lawsuits—as it has in California. On Monday, the Consumer Energy Alliance (CEA), a coalition that includes oil companies and trucking and transportation groups, sent letters to 11 attorneys general whose states are developing the regional Clean Fuels Standard, saying the initiative could be unconstitutional and is "unlikely to survive judicial scrutiny" if challenged in court.
The Obama administration's plan to speed up permitting of oil and natural gas drilling projects on federal land drew cautious support from industry representatives and environmental leaders who say implementation of the effort must strike the proper balance between conservation and energy development. Interior Secretary Ken Salazar yesterday announced that the agency plans to launch an automated system for tracking onshore drilling applications that could slash permitting times for onshore wells by two-thirds.
The surge in gasoline prices has stalled around $3.92 per gallon, but experts caution that more increases are coming. Many refineries still haven’t undergone a seasonal maintenance period that will force them to produce less gas. That will tighten supplies in some parts of the country, especially in the Great Lakes region, and push prices higher.
The Obama administration on Tuesday unveiled new procedures to speed up drilling on public lands, an area where Republicans and the oil industry have pressed the administration to do more to boost oil production and help drive down gasoline prices. The changes will move the Bureau of Land Management, the agency responsible for oil and gas production on federal onshore lands, into the digital age by automating permitting and leasing decisions.
Vice President Joe Biden promised students at a Virginia high school a quick explanation for why U.S. gas prices are high and still rising, but then went on for 11 minutes, delving into the complexities of the oil market and of the changes and tensions in the Middle East. The explanation came when a student at Maury High School in Norfolk, Va., following a speech on college affordability, asked the vice president why gas prices are so high.
Interior Secretary Ken Salazar got a close-up look at oil drilling in the booming Bakken formation Monday and Tuesday, as his department rolls out new programs to speed up processing of permits for the work. During a two-day energy tour of North Dakota, Salazar visited temporary housing for oilfield workers that have swarmed the state and checked out a rig drilling a well for The Woodlands, Texas-based Newfield Exploration Co.
We now all know that Barack Obama, caught on camera and an open mic, has been furtive when speaking with the Russians about his future intentions. But, to the contrary, he’s been crystal clear about his feelings toward America’s oil and gas industry: He abhors it. That much was made plain during a recent Rose Garden event. In a smearing speech, the president hurled epithets like “outrageous” and “inexcusable” at top energy firms, vilifying their tax subsidies as “giveaways.” That’s tough and hypocritical talk from a man whose penchant for giveaways handsomely favors so many others.
 WASHINGTON, D.C. – Yesterday, the Natural Resources Committee held an oversight field hearing in Anchorage, Alaska on, “Alaska’s Sovereignty In Peril: The National Ocean Policy’s Goal to Federalize Alaska.”  The hearing focused on how President Obama’s plan to mandate ocean zoning through implementation of the National Ocean Policy threatens Alaska’s sovereignty and economic livelihood.
Congressman Don Young, Alaska, Ocean Policy, Coastal Management“Nowhere in the United States will the effects of the National Ocean Policy be felt to the extent that it will in Alaska.  The reach of this ‘ocean’ policy will stretch throughout the entire state and affect almost any activity that requires a federal permit.  As we will hear from our witnesses today, the State’s economic vitality is a direct result of our ability to use our natural resources.  Any new federal initiative that affects our ability to use these natural resources will cost jobs,” said Rep. Don Young (NGP Photo)
President Obama’s National Ocean Policy calls for a new ‘ocean zoning’ authority headed by 9 Federally-dominated Regional Planning Bodies with the ability to reach as far inland as each deems necessary to protect ocean ecosystem health.  The Regional Planning Bodies will have no representation by the people, communities and businesses that will actually be impacted by the regulations and will create zoning plans without any stakeholder input.  However, all Federal agencies, the States, and the regulated industries will be bound by the plan.
Doug Vincent-LangAccording to Doug Vincent-Lang, Acting Director of Alaska’s Division of Wildlife Conservation of the Alaska Department of Fish and Game, Alaska’s marine and coastal resources support a “vibrant fishing industry that produces almost six billion dollars in economic activity in our state annually, accounts for approximately 60 percent of the nation's seafood production, and is our largest private sector employer.”  Testifying on behalf of the State of Alaska, Vincent-Lang emphasized the importance of Alaska’s continued management of their ocean and coastal resources to the State and local economies.  Alaska’s current regulatory framework, comprised of successful partnerships among federal, state, tribal and local authorities, “has a proven track record and is fully capable of ensuring the long-term health and viability our marine and coastal resources. … Overlaying the President’s national ocean policy on top of the existing statutory and regulatory framework creates uncertainty and conflict, both of which are problematic if the goal is to encourage economic development, jobs, and certainty in permitting.”
Rick Rogers, Resource Development Council for Alaska, RDC, Ocean PolicySeveral witnesses at the hearing discussed the potential economic ramifications of adding more bureaucratic hurdles to resource-dependent industries.  Rick Rogers, Executive Director of the Resource Development Council for Alaska, stated the extra regulatory layer imposed by the National Ocean Policy “adds uncertainty and anxiety to an already cumbersome and complex regime of state and federal permitting and oversight.  Increased bureaucracy could hamper the already slow processes with no added benefit to the environment.”  Rogers noted that Alaska’s economy is dependent upon its vast natural resources and, “All Alaska industries, forestry, tourism, oil and gas, fisheries and mining, are highly dependent on ocean access and marine transportation. … The decline of the timber industry in Alaska highlights our need to be ever vigilant regarding the unintended consequences of policy initiatives such as the National Ocean Policy and Coastal and Marine Spatial Planning.”
Executive Director of the Alaska Oil and Gas Association Kara Moriarty’s (NGP Photo) testimony focused on the economic value of continued Kara Moriarty, AOGA, Alaska Oil and Gas Association, Ocean Policyresource development in Alaska.  “The importance of oil and gas development on Alaska’s Outer Continental Shelf, to Alaska and the nation, cannot be overstated. … Alaska’s OCS is estimated to hold 27 billion barrels of oil and 132 trillion cubic feet of natural gas, the development of which would translate into an annual average of 54,000 new jobs over 50 years, $145 billion in payroll throughout the U.S. and $193 billion in revenues to state, local and federal governments.”  Moriarty also highlighted the lack of details surrounding Coastal and Marine Spatial Planning and the policies and procedures of the Regional Planning Bodies charged with creation and implementation of the regional ocean zoning plans.  “Under the Draft Implementation Plan, stakeholders will have no direct representation on the planning bodies, despite the fact that the planning bodies are charged with creation and implementation of regional CMS plans encompassing all ocean and coastal uses.  If CMS plans are to be effective and useful tools for ocean and coastal management, we believe membership should be expanded to include representatives from stakeholder groups, including the oil and gas industry.  Without such involvement, the potential is real for prohibitions against activities such as oil and gas without the involvement of the most impacted parties.”
The National Ocean Policy mandates that the Regional Planning Bodies can regulate onshore activities that may have impacts on marine waters.  Fred Parady, Executive Director of the Alaska Miners Association, discussed the potential for increased lawsuits and litigation driven by third parties due to the implementation of this Policy.  “Clearly, uncertainty is heightened by the National Ocean Policy’s stated policy of reaching to onshore activities that may have impacts on marine waters.  Section 404 of clean water act and the ubiquitous nature of wetlands means upland activities already are highly regulated in Alaska. A plethora of petitions to list additional species under ESA onshore and off are adding substantial burdens to landowners and resource industries, without resulting in any recognizable progress for the underlying species. … The National Ocean Policy adds yet another another [sic] hurdle to overcome, and will serve to provide an additional platform for third party eNGOs to litigate against projects that fail to meet the informational requirements or expectations for the National Ocean Policy.”  





03 April 2012 3:25pm

Readers living in Anchorage should put tomorrow, April 4, 5 p.m. on their calendars for  a, "Public Rally For Fair Trials and Justice for Senator Ted Stevens(NGP Photo), at the PenAir Hangar, 6100 Boeing Avenue.  Enjoy the Rally, BBQ, good times.  Sign an open letter calling for government accountability and reform at www.alaskansforjustice.com.

4-2-12 - Citizens -- Not "Elitists" -- Sent Juneau A Tax Reform Message Last Week

02 April 2012 2:17am

News Miner/AP by Becky Bohrer.  This could be the week the Senate releases its long-awaited oil tax plan.

Those living in Anchorage should put Wednesday, April 4, 5 p.m. on their calendars for  a, "Public Rally For Fair Trials and Justice for Senator Ted Stevens (NGP Photo), at the PenAir Hangar, 6100 Boeing Avenue.  Enjoy the Rally, BBQ, good times.  Sign an open letter calling for government accountability and reform at www.alaskansforjustice.com.

First thing Monday morning, 7 a.m. Alaska Time, I'll be appearing on Dan Fagan's television show to discuss the nuances of gas pipeline announcements Friday from Governor Parnell's office and from the three major Alaska North Slope Producers.  Readers might be able to view live here, online. -dh

CBC News.   The federal budget, released Thursday in Ottawa, Canada contains some of the biggest cross-country cuts since the 1990s.  Old age security eligibility will be raised to the age of 67, the penny will be phased out, and about 19,000 public sector jobs will be cut over the next three years.  The budget also includes several plans for the country's North.  Among the most notable plans is $225 million to repair harbours across the country.  Included in that money is a plan to "accelerate" the construction of the harbour in Pangnirtung, Nunavut, in Canada's eastern Arctic, which was originally announced in 2009.

Over A Thousand Alaskan Citizens -- Not Elitists -- Sent A Powerful Tax Reform Message To Juneau Last Week.

Commentary by

Dave Harbour


Last Wednesday, a thousand citizens representing 19 diverse organizations and hundreds of companies met in Anchorage to demand that Legislators not come home without having enacted “meaningful tax reform,” leading to improvement in Alaska's investment climate.  (Note: Here is one video of the event; and, here's another.)
Then I read a report the next day in the Alaska Dispatch that I could hardly believe.  The normally even handed publication abandoned any reasonable, professional standard – even for an editorial – and characterized the event as an elitist gathering. It used silly, misleading and unrelated examples and further disparaged and degraded citizens attending through innuendo.  (See Dispatch story here.)
The author, a Dispatch Staff Writer, began by describing a huge meeting of very normally appearing folks in Anchorage as "...munch(ing) on $40-a-plate chicken and vegetable mix, listening to like-minded people telling them things they already believe...." and "…wearing suits and ties, stilettos and little black business skirts.  …Prada purses and Lancôme lipstick and aftershave with hints of pine and snow.”  That description would fit for half the meetings occurring in Anchorage—though a little exaggerated.  Heck, this writer munches at every meal and that day I wore a tie and noted that most didn’t--though everyone did seem to be wrapped in clean clothes.  Neither did I smell any aftershave or perfume on anyone though I typically don’t stroll through an audience attending an event I’m covering, sniffing for strange scents upon which to report.  Nor did I ask any lady to open her purse for me to inspect the brand of lipstick she preferred, though I can’t swear that the Dispatch journalist couldn’t have spied such a brand.
The Alaska Dispatch writer used innuendo to attack a decent gathering of Alaskans. 
But innuendo aside, what’s wrong with anyone wearing a tie or high heels?  And what’s wrong with an ‘Oil Company’ audience, even if this wasn’t one?  Heck, every Alaskan should give thanks to the Good Lord daily for the miracle that is oil and for the abundance of it that is found in Alaska.  After all, our Constitution is based on resource development.  And—something the Dispatch writer may not have been told--without the Swanson River Oil discovery in 1957, Governors Egan and Hickel, Bob Atwood and their colleague lobbyists would not have been able to convince Congress to successfully pass and President Eisenhower to sign the Alaska Statehood Act in 1958.
I was more intent on the message.  Governor Sean Parnell (NGP Photo) said something that allSean Parnell, Oil Taxes, Rally, Make Alaska Competitive  Dispatch readers – all Alaskans -- would surely appreciate knowing, had the writer quoted him:  “Alaskans don’t live in a world of ‘we can’t.’ We live in a world of ‘can do.’ We live in a land where billions of barrels of oil are yet to be recovered. We live in a time where Alaskans can unlock this oil for our own benefit and for future generations.”    (Here is the link to his entire speech for NGP readers.)
The meeting was held in the Dena’ina Convention Center in the center of downtown Anchorage.  The place seems to be jumping all year long with every sort of Alaska related meeting from tourism to Native to engineering and commercial fishing to international trade to Rotary and chamber and education and governmental meetings.  The Dispatch writer seemed more than eager – even desperate -- to distinguish this as a ‘different’ audience.  
But critically listening and then commenting on the substance of the meeting apparently didn’t produce the message that interested her.  So she aimed a cheap shot at the citizens attending, attacking them by innuendo.  She noted that the meeting was an “oil industry rally in downtown Anchorage, just a few minutes from Nordstrom.”  A professional editor or fact checker should have said to her, “Seriously?  Most of the people in that room were not employed by oil companies and every meeting held in that building is ‘a few minutes from Nordstrom’.”    
I was personally moved – intellectually and emotionally – by the presentations and found them full of fact and first hand anecdotal detail supporting tax reform. 

Cordelia Kellie, a recent college graduate newly hired by the Arctic Slope Regional Corporation spoke of the opportunity the oil industry gives to young people, particularly in rural areas.  (Here is a link to her prepared remarks.)

“Oil fuels our economy," said Steve Robustellini, event speaker and resident of Port Lions, Kodiak.  “It provides the funding for our schools, communities and infrastructure. I left a dying timber industry when I moved my family from California 12 years ago. I have seen the consequences of lost revenue from an industry that is the lifeblood of a state. It is not so much about ‘Big Oil’ as it is about Alaska, its people and communities. We need a globally competitive tax structure and long-term sustainability.”   (Here is the link to his prepared speech for NGP readers.)
Matanuska Valley housewife and small business owner Laura Maketa brought more than one set of eyes to tears with her story: “My husband and I began our entrepreneur ventures in 2003 by selling everything we owned, moved into a little camper through a very cold winter, with our two boys, and built our first duplex. Our businesses have grown into our family business, Mak 3 Construction….  To keep our guys busy and to continue a viable business, like many other Alaskan companies, we found work in North Dakota last year.  We have only a handful of employees working in Alaska, and we will be looking to North Dakota for work again this spring.  The current tax structure under ACES,” she said, “ is crushing business growth in Alaska. We are already behind the curve fixing this economic storm that will occur when TAPS gets to the magic number in which it is no longer viable.  According to Baker Hughes rig count when North Dakota had 160 wells being drilled we only had one.  TAPS is diminishing yearly and the current federal regulatory barriers and state tax structure is creating a doom and gloom atmosphere regarding future prospects in Alaska. “  (Here is the link to her prepared speech for NGP readers.)
Former Governor Tony Knowles agreed. “By all accounts today we are resource abundant, just as we were in 1981. The fields are harder and more expensive to develop, but we know they are there. We are not resource short; rather, we are capital investment short.”  Then Knowles recounted the story we have been telling several times a year about the great “fair share consensus” of 1981 that most policy makers and journalists try ardently to avoid mentioning.  That agreement--broken by current tax creators--led to 20 years of tax stability and enormous investment.   Hear our recording of that event here.  “In 1981”, he said, “then Republican Governor Jay Hammond (NGP Photo-L) pulled together a historical press conference with himself the Speaker of the House Jim Duncan and the President of the Senate Democrat Jay Kertulla and party leaders from both side of the aisle and bodies of the legislature, Ed Dankworth, Don Bennett, Sam Cotton, and Hugh Malone, and declared in no uncertain terms their joint decision in arriving at what they had determined together was Alaska’s fair share of revenues.  It was at a time of then record high oil prices of $35 a barrel and production was at 1.5 million barrels a day and growing.  “There loomed a huge fight of forces wanting both higher taxes and lower taxes”, said Knowles.  “ Jay Hammond and the legislative leaders – before the details were determined -decided that Alaska’s fair share would be no less than a roughly one third one third one third split with industry, the state, and the federal  government.  With that decided Jay also noted that a mutually fair share would also bring stability and for almost twenty years this model led to more revenues, more investment, and more production. It was a tough judgment call by good Alaskans – and it worked.  The percentages today are far different with an existing tax regime that overall has the state share at more than sixty percent of total revenues and increases dramatically at the margin with higher oil prices.”  (Here is the link to his presentation.)
Of course, the Dispatch staff writer did not mention that the Mistress of Ceremonies was not some diamond-studded oil baron, but Barbara Huff Tuckness, of the Teamsters Union, who also spoke eloquently of the need for tax reform and improvement of Alaska’s investment climate.

Neither did the Dispatch writer mention that during the Rally, Huff asked participants to complete comment cards with their opinions on oil tax reform. Those comment cards were copied, made into books, and delivered to legislators in Juneau the following day.  

The Dispatch writer easily dismissed a similar Fairbanks rally two days earlier by "reporting", “…it was likely a much more subdued affair.”  A simple phone call to Fairbanks might have revealed the true result to her.  According to one of our sources, “hundreds of Fairbanks residents” showing up at the Carlson Center heard civic and business leaders talk about why oil tax reform is needed now.  On a per capita basis, that Interior Alaska turnout might be considered more impressive than the Anchorage gathering.
The Dispatch story was illustrated not with charts and graphs or speaker quotes describing Alaska’s competitive tax position with other oil producing areas but with a photo of luncheon brochure hand-outs positioned under a piece of dessert cake. 
Particularly offensive was that the story ended, not with a critical analysis of Governor Knowles’ or any other presentation, but with irrelevant, caustic criticism about his service as Governor.
The luncheon audience was as diverse as has ever gathered in Anchorage.  It included some oil company employees and managers but was mostly composed of ordinary citizens and members of the following diverse grouping of organizations representing a huge range of Alaskan interests—not just one special interest: Alaska Bankers Association; Alaska Crab Coalition; Alaska Cruise Association; Alaska Energy Forum; Alaska Forest Association; Alaska Miners Association; Alaska Oil & Gas Association; Alaska State Chamber of Commerce; Alaska Support Industry Alliance; Alaska Trucking Association; Anchorage Chamber of Commerce; Anchorage Economic Development Corporation; Associated Builders and Contractors; Associated General Contractors; Consumer Energy Alliance Alaska; Greater Fairbanks Chamber of Commerce; Council of Alaska Producers; Make Alaska Competitive Coalition; Prosperity Alaska; and the Resource Development Council.
We have generally respected the diligent reporting of the Dispatch.  We would hope that a forthcoming, sincere apology for this unwarranted attack on fellow citizens could help reinstate it as a professional journal dedicated to solid reporting and fair editorial comment.  

Other event photos:
Lora Reinbold, Alaska legislative candidate, by Dave Harbour, Eagle RiverLora Reinbold
Doug Smith, Alliance, Alaska Support Industry Alliance, Little Red, Photo by Dave Harbour, Production Tax ProgressivityDoug Smith
Trond-Erik-Johansen, ConocoPhillips, Alaska Oil Tax Progressivity, Production tax, severance tax, Photo by Dave HarbourTrond-Erik
Lynn Gattis, Mat Valley, Alaska Legislature, Candidate, Photo by Dave Harbour
Lynn Gattis
John Maketa, Alaska Contractor, oil taxes, Photo by Dave HarbourJohn Maketa 
Laura Maketa
Laura Maketa, Mak 3 Construction, oil taxes, make alaska competitive, Photo by Dave Harbour
           Rick Fox                      Casey Sullivan
 Rick Fox, Shell, OCS, Photo by Dave Harbour