Miss a day
Miss a lot


      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



9-28-15 Supplement: Clarification of AGDC Mission

28 September 2015 5:19pm


Contact: Miles Baker, VP External Affairs & Government Relations (907) 321-8650

AGDC Clarifies Status of ASAP Project

Federal Environmental Work on In-State Gasline Project Ongoing

September 28, 2015 Anchorage, AK – The Alaska Gasline Development Corporation (AGDC) released a statement today clarifying the status of the Alaska Stand Alone Pipeline (ASAP) project. In the last few days, several media outlets have incorrectly reported that the corporation’s board of directors took action to suspend work on the ASAP project during their September 23rd meeting in Anchorage.

In a prepared statement, AGDC President Dan Fauske said:

The Alaska LNG project continues to be this corporation’s number one priority. However, our board’s direction to management has been clear – continue to maintain the viability and readiness of the Alaska Stand Alone Pipeline (ASAP) project as the state’s backup plan. The corporation is prudently managing the state’s resources by eliminating duplication of effort and cost, but intent on preserving ASAP’s knowledge base and readiness in the event the Alaska LNG initiative does not progress to project sanctioning. At our September meeting, the AGDC board received a progress update from the ASAP team, but issued no directional change to management regarding the project.

In January, AGDC completed FEED and delivered a full Class 3 cost estimate for the ASAP project. The milestone was the culmination of a substantial body of work, conducted over several years and it was achieved on-time and under budget. However, in response to the State of Alaska’s decision to prioritize the Alaska LNG project, the AGDC board prudently adjusted the future work plan, budget and timeline of the ASAP project to bring it into alignment with key Alaska LNG decision milestones. This included postponing additional commercial activities pending an outcome on the Alaska LNG project. With principal ASAP engineering work completed, AGDC has concentrated its work efforts on continuing the U.S. Army Corps of Engineers (Corps) Supplemental Environmental Impact Statement (SEIS) process so that federal permits and right-of-ways for the ASAP project can be secured.

During last week’s board meeting, the ASAP project team confirmed that AGDC filed a revised Section 404 Clean Water Act permit application with the Corps on September 10th and would also be submitting an updated right-of-way lease amendment to the State of Alaska within the next several weeks. The team also highlighted that it has recently posted a new interactive map viewer to the ASAP website in support of the SEIS process. The map viewer allows the public to explore the project’s alignment, geographic footprint, facilities and design components in order to better visualize the project and its potential impacts.

The ASAP project is designed to deliver utility grade natural gas from Alaska’s North Slope to Fairbanks, Anchorage and as many other communities within the state as possible. The project consists of a gas conditioning facility, a 36-inch diameter pipeline from Prudhoe Bay to ENSTAR’s existing gas distribution system near Anchorage at Big Lake; and a 30-mile lateral to Fairbanks.


9-25-15 Alaska's Governor Issues Bombshell Gasline Report

25 September 2015 2:47am

Gasline from Alaska Governor Bill Walker on Vimeo.




(Scheduled for completion this weekend)

Reader comments:



"... appreciate your efforts greatly, as do a lot of folks."

-From an energy industry journalist.

Hi Dave:
Did you ever read the Bizarro World comics??  
We are living such in real time I'm afraid.  
Ron Arvin 

I always enjoy your newsletter, but your recent re: the NG issues one is special.

In my nearly 60 years in Alaska I have witnessed "many positive", and "too many negative" uses of the resources found within the boundaries of Alaska (not the boundaries of the State of Alaska) but nothing, not fish plants, not bridges to nowhere, not barley farms, etc.,  come anywhere near the Natural Gas fiasco that got underway with the El Paso group so long ago.

I have many observations and opinions on what has transpired over time, and will not list them.

But I continue to marvel at the way our "leaders" (elected and not) and the consultants, have been able to relieve the bank accounts (and the money goes somewhere!)!

Terry Brady, Photo by Dave HarbourThanks, keep up the good reporting.

Terry T. Brady, MS (wood science), for
Nordev, LLC   (NGP Photo)



The Governor's Bombshell

Commentary by

Dave Harbour

We call Governor Bill Walker's actions this week a 'bombshell' because just as they create a new relationship with Alaska's largest investors so do they change Alaska's reputation as an investment destination.  While the Governor has created "change he surely hopes Alaskans will believe in", at the same time, he has destroyed Alaska's attempt over the last few years to make itself more attractive to investors.

Here is, 1) what the Governor did and, 2) how we react to those actions after nearly 45 years of experience in Alaska as a regulator, educator, journalist, small business owner, municipal employee, oil industry executive and non-profit sector volunteer.

What The Governor Did

  • Alaska Governor released a "Summary Report on the Review of the Alaska LNG Project Process"
  • The "review" should be read in context of his very personal transmittal  letter sent to legislators.
  • Above is a video he released yesterday.
  • Here is a bearish oil price report provided by the Governor
  • Here is the Governor's proclamation calling for a special session to, among other things, establish a 'reserves tax' on industry investors applying to gas that is available but not committed to a market.
  • Here is the Governor's news release, discussing the above actions.
  • Alex DeMarban's ADN review of events.
  • We think Alaska's leaders may sometimes forget that sophisticated observers are watching, from all over the world!  Here's an example, our Australian oil and gas industry analyst friend who is quite candid about his view of Alaskan leadership and its LNG project.
  • Here is our recent and highly relevant review of the Alaska investment climate.


Our Reaction To What The Governor Did

General.  Governor Walker assumed office knowing the economic challenges were awesome.  

Oil prices ranged at half the level the state operating budget required and that operating budget, in turn, was 90% dependent on Prudhoe Bay oil production.  The entire economy of Alaska is over a third dependent on this sole source of income.  Annual deficits of $3.5 - $5 billion will deplete the state's available savings within two - three years depending on the level of spending cuts politicians are ready to approve.  Still, an almost $10 billion state employee retirement program unfunded liability awaits full funding.

Alaska's oil income flows from a 1/8 royalty share of the oil; a discriminatory, statewide 20 mil oil and gas property tax; one of the highest production (i.e. 'severance') taxes in the free world; and, a corporate income tax.

While the royalty rate was one of the lease terms agreed upon during the famous 1969 Prudhoe Bay lease sale, the bulk of oil taxation was added after the lease holders began making their massive investment in developing the ANS reservoirs and building TAPS.  For the dozen years following the lease sale, taxes were increased about a dozen times.  At least twice in Alaska's history, higher tax rates were applied retroactively for the sole purpose of clawing into state coffers, more money. 

While Alaska got away with its unfair and predatory taxation for a long time, even the great and prolific Prudhoe Bay reserves would dwindle, age and continue need massive reinvestment in order to spawn new production.  The trouble is that with the highest oil taxes in the free world, Alaska's political leadership had created the highest per capita taxing authority in America, the highest debt per capita state in the nation characterized by some of the most lavish social programs devised by man.  Alaska even has more non-profit organizations per capita than any other state.

Dr Scott Goldsmith, UAA, ISER, oil taxes, safe landing, Photo by Dave HarbourIn the early 1990s, Dr. Scott Goldsmith (NGP Photo) of the state university's Institute of Social and Economic Research began warning that if Alaska were to begin slowly cutting the growth of spending its economy could arrive at a "soft landing", meaning a sustainable, long term economy.

Common Sense for Alaska, a public interest non-profit organization, sponsored government-spending conferences leading to powerful recommendations for a constitutional amendment limiting government spending increases to an inflation/population formula.  

All public officials paid lip service to both Dr. Goldsmith's warnings and Common Sense's recommendations, to no effect.  Spending continued to explode.

Alaskan apologists justified their high oil taxes and high spending in this way: "We are a large state with a small population and our cost of living is higher than elsewhere; therefore, it costs more for us to maintain government services."

Problem with that argument is that no matter how much a person, family or government wants to spend more money, one simply can't spend more than one brings in without sacrificing credit worthiness.  (Of course, the Federal government has shown that it can spend over $18 trillion more than it takes in, but even its citizens pay for its irresponsibility when, ultimately, inflation devalues the currency)  Recently the rating agencies, as we have long predicted, began putting Alaska on notice that its cost of borrowing is likely to increase since its economic risks have now become too large for analysts to ignore.  

In addition to the low price era in which Walker finds himself, production has been steadily declining for years at a 5-7% rate.  

In the mid 80s, Alaska produced over 2 million barrels per day to feed about a fifth of America's domestic oil needs.  The Trans Alaska Pipeline System (TAPS) which transports Alaska North Slope (ANS) oil to tidewater now operates at only about a quarter of its capacity.  Nearly three-quarters empty is another way to put it.

Governor's Background.   Governor Bill Walker was born, raised and spent most of his life in the state.   We believe that many who know him would agree he is a gifted public speaker with charismatic qualities.  He knows the state well.  

These attributes would benefit one's role as governor.

But being governor of a State dependent on oil investment requires a studied, wise, world view of the opportunities, the competition, the alliances leading to a successful term of office.

As a lawyer, much of his professional background, counter-intuitively, dealt with politics and marketing.   He held elective posts in Valdez, site of the major, 1989 oil spill, and served as the general counsel and major marketer of a municipally-owned authority.  

The Alaska Gasline Port Authority (AGPA) was designed to promote (i.e. and then finance, build and own) a gas pipeline/LNG export project.  

During this time, Walker continually criticized other parties (i.e. like the oil industry) for not cooperating with AGPA's or predecessor LNG project efforts.   

An observer might conclude Walker's AGPA was never successful for logical reasons:  1) From the early 80s to the late 90s, the Lower 48 gas price was too low to support any project and the world LNG trade was in its infancy.  2) During the years, before the shale phenomenon, when the Lower 48 needed Alaskan gas, the most economical way to monetize ANS gas was to send it by pipeline directly down to those markets, and not to try to send it via tankers to Asian markets.  3) When the shale revolution produced massive gas supply for North American markets, Asia looked more promising, especially after the Nakashima tragedy in Japan lessened interest in Nuclear power and increased interest in natural gas fired power plants.  At that point, the major gas owners rather quickly shifted their sights to Asia and with ample expertise and contacts had no need for a 'middle man' like AGPA to market their gas.  

Others may view it differently, but this scenario provides a very understandable backdrop for this governor's 'Alaska-centric' judgment and decision making.  

While his AGPA attempts failed to monetize ANS gas, now he is governor and, again, he may be viewing the oil companies as roadblocks when, in fact, their diligent efforts have brought an ANS gas monetization project farther forward than ever before.

We believe it ironic that Walker's zeal to be the man at the helm of an LNG project may, in fact, be clouding his judgment and sabatoging the project.  

Insisting on certain state control of and equity in a mega project perverts the private enterprise system to begin with.  Then, to be criticizing the investors, refusing to talk about a comprehensive fiscal security package for them and threatening them with a gas reserves tax radiates a hostility sufficient to dampen the ardor of any Alaska investor, current or potential.

In fact, we would be not the least surprised to someday read an announcement from one or more producers to the effect that, "The governor has indicated his desire to own and operate an ANS gas pipeline/LNG system.  We respect that desire and, accordingly, are withdrawing from our plan to construct such a project.  Instead, we stand ready to sell the state the research and planning material we have developed and will support the governor's efforts in any reasonable way.  Our efforts had led Alaska closer than ever before to launching a successful ANS gas monetization project and we were completely on schedule with that effort, but for the governor's demand that we spend additional time and money studying a 48" pipeline alternative.  The time honored adage that, 'too many cooks spoil the soup', is as true now as it was in the old days.  Rather than face a continuingly critical state administration for what we believe has been our on-time, on-budget, good faith gas monetization effort, we conclude it prudent to transform our project support into support for the governor's state-ownership idea, whatever that turns out to be.  Meanwhile, we shall shift the majority of our focus now on investing in expanded throughput of TAPS, upon which the state government and the people of Alaska depend."


Please check back this weekend; much more coming....

Can Alaska be a place where a deal is a deal?

We detest intergenerational inequity

Alaska Gas Pipeline Commentary






KTVA Video/story by Liz Raines.  The Alaska Stand Alone Pipeline (ASAP) was almost ready for construction after more than five years. At a board meeting Wednesday, members of The Alaska Gasline Development Corporation (AGDC) decided to mothball it, saying they didn’t want to run parallel projects. Instead, the agency plans to focus efforts and funding on AKLNG, the larger pipeline project that involves large oil companies like Exxon Mobil, BP and ConocoPhillips.

ADN by Alex DeMarban.  ... concerned with public apathy about an effort the state has pursued unsuccessfully for decades -- to tap and sell gigantic volumes of North Slope gas -- the Alaska Gasline Development Corp. has proposed launching a communication campaign to educate the public about Alaska LNG.


(John) Burns, the chair, said there’s a lot of “gas line fatigue” in Alaska, with people confused about the process. Some don't understand that the large sums the state is putting into the project are investments that will one day yield income, he said. 

An education campaign could help unify the state’s messages that currently come from multiple sources, including the governor's office, AGDC and agencies working on the effort, officials said.

“The general public has to know what’s going on. It’s Alaska’s pipeline,” said board member Dave Cruz.  

Miles Baker, vice president of external affairs and government relations, said the campaign could probably cost “several million dollars” over the next couple years. 

(AGDC President Dan) Fauske said that's possible, but a final plan has yet to be presented to the board. 

"We really have no clue," he said, referring to the potential cost. 


Reference: Governor Bill Walker's transmittal letter to Legislators

Reference: Governor Bill Walker's, "Summary Report on the Review of the Alaska LNG Project Process"

We will provide our dear readers with commentary later in the day on Friday.

Here is the copy of an email alert we also issued Thursday on this subject:

Today, Governor Bill Walker released a, "Report on the Review of the Alaska LNG Project Process" and we wanted you to review it before the world sees it tomorrow.  We include it in one of our rare "early reports" which will be completed later on Friday.
The many cooks in Alaska's LNG kitchen sometimes cause us to ask, "Who's On First," and include:
  • A Governor who has endured a quixotic journey of several decades to force private industry to build a project of his own dreams, and
  • Legislative leaders who created a several hundred million dollar state-owned "Alaska Gasline Development Corporation" (AGDC) to deliver North Slope Gas to citizens in case a larger interstate project did not materialize, now run by Walker's appointed board members, and
  • Alaska's largest investors, the North Slope Producers, who purchased leases, found oil and gas and have the right to market it while providing a royalty in kind (RIK) or royalty in value (RIV) to the state, and
  • Fairbanks citizens and politicians anxious to benefit from a state-financed -- and to this point state managed -- natural gas distribution system concept, enabled by Walker appointed members of a state investment corporation, and
  • Politicians from all over the state who are thinking, "How can my constituents and I benefit from any of the horse trading going on", and
  • Frightened citizens whose leaders have created a $4-5 billion ANNUAL deficit in the state operating budget which is almost 90% funded by North Slope producers -- at a time when production is declining, world oil prices remain depressed and state spending continues rising. 
You will also see, today in 'tomorrow's early report' a KTVA television story describing how this week the AGDC voted to mothball its legislative in-state gasline mandate in order to focus its effort on state ownership of the producer's Ak-LNG project.  And we provide a link to the ADN's review of the AGDC board meeting, including an exchange about how the government might spend, "...several million dollars...." on a promotional effort to develop project support among state citizens.
With so many government cooks in the LNG kitchen, really, what could possibly go wrong?
P.S.  Don't miss today's actual posting of information regarding TRANSCANADA'S big personnel layoffs, SUNCOR'S acquisition and the Alaska producers agreeing to a concept for LNG project payments to the state in lieu of property taxes.


From: Aussie Oil & Gas Observer


Regular readers will know that this blog considers the Alaska LNG (AKLNG) project to be the Aesopian tortoise of the LNG project world – not as flashy as some, but plodding towards first gas next decade.

However, that tortoise carries a heavy shell that would be familiar to LNG project proponents in most locations around the world – a Government that wants to maximize its share of something that does not as yet exist – and therefore risks getting a larger share in nothing rather than a reasonable share in something.

Australian readers of this blog will likely be familiar with only one Alaskan Governor – the surprisingly socialist (when it comes to taxing oil companies) Sarah Palin.  Her populist instincts live on in the State and even the Russian news service Interfax today points out that AKLNG risks being bogged down by politics (http://interfaxenergy.com/gasdaily/article/17647/alaska-lng-could-be-left-out-in-the-cold).

Alaskan based website Northern Gas Pipelines (http://www.northerngaspipelines.com) today provides an update on the latest Government meddling in AKLNG and asks the reasonable question – “with so many government cooks in the LNG kitchen, really, what could possibly go wrong?”




Dave Harbour, publisher of Northern Gas Pipelines, is a former Chairman of the Regulatory Commission of Alaska and a Commissioner Emeritus of the National Association of Regulatory Utility Commissioners (NARUC).  He served as NARUC's official representative to the Interstate Oil & Gas Compact Commission (IOGCC).  Harbour is past Chairman of the Alaska Council on Economic Education, Anchorage Downtown Partnership, and the Anchorage Chamber of Commerce.  He served as President of the American Bald Eagle Foundation, Common Sense for Alaska and the Alaska Press Club.  He is Chairman Emeritus of the Alaska Oil & Gas Congress.

Opinions or viewpoints expressed in this webpage or in our email alerts are completely independent.  They are solely those of the publisher and are not intended to reflect the opinion(s) of any affiliated company, person, employer or other organization which or who may, in fact, oppose the views stated herein.  -dh




4-19-15 Pipeline Right of Way Bill Passes

22 April 2015 8:12am

Bill Walker, Alaska Gas Pipeline, Right of Way, Dave Harbour PhotoGovernor Bill Walker today applauded the House and Senate for passing his Gas Pipeline Right-of-Way bill with unanimous support. Once signed into law, SB70 will authorize the issuance of a right-of-way lease for a natural gas pipeline through a corridor in the Denali State Park, Willow Creek, Nancy Lake, and Captain Cook State Recreation Areas.

“I want to thank the legislature today for passing this important piece of legislation,” said Governor Walker. “This right-of-way is a necessary component to building a future natural gas pipeline in Alaska. By setting the wheels in motion now, we will be better prepared down the road.”

SB70 allows of the leasing of a corridor that will be adequate for either the AKLNG or ASAP project. The right-of-way within the authorized area will be approximately 120 feet wide for construction and 53 feet wide for operation under the ASAP project, and approximately  180 feet wide for construction and 100 feet wide for operation under the AKLNG project. Additionally, the bill requires the corridor to be managed as parkland and recreation areas until a lease is issued, and returned to original park and recreation land upon termination of the lease.

Right-of-way leases under SB 70 must be issued by January 1, 2025 and, construction of the pipeline must begin within 10 years of the effective lease date.

-Grace Jang, Office of the Governor


4-22-15 AGDC Lets Alaska Gas Pipeline Material and Weld Qualification Contract

22 April 2015 8:06am

Pete Kelley, Fairbanks, Finance Committee, Senator, Video Photo by Dave HarbourKTUU News.  Disagreements over the state's operating budget continue to keep lawmakers in Juneau past the 90-day session.  Members of the Senate Finance Committee spoke out Tuesday for the first time since the session was extended Sunday night.                                                                                 "The cavalry of funding not coming over the hill to rescue us -- we don't have the money," said Senate Finance Co-Chairman Pete Kelly (Video File Photo).  More with video....

World Pipelines.  Exova, the global testing, calibration and advisory services provider, has been contracted by the Alaska Gasline Development Corporation (AGDC) to provide a material and weld qualification programme for AGDC’s Alaska Stand Alone Pipeline (ASAP) project.

AGDC is currently engaged in Front-End Engineering and Design (FEED) for the US$10 billion North Slope natural gas project and in its first contract with the company, Exova’s Houston laboratory is qualifying selected pipe mills and welding contractors specified by AGDC to work on the 727 mile, 36 in. main pipeline.  More....




4-1-15 Happy April Fools Day! Commentary: Are We The Fools?

31 March 2015 11:30pm

See National Ocean Policy Council Alert Here!

(Readers will understand the importance of this alert after reading today's commentary, below.  -dh)

See Part 4, Alaska Economic Report Below

Related Commentary: "The Sting"

Last Friday, former Alaska Legislator Beth Kerttula, posted this NEW OCEAN POLICY announcement

"Today, we are releasing the first Report on the Implementation of the National Ocean Policy, which highlights the progress we’ve made since we released an action plan last year. From supporting the ocean economy to ensuring the security of our ports and waterways, and from improving coastal and ocean resilience to providing local communities with tools to plan for a better future, we’ve made tremendous strides in undertaking our role as responsible stewards of this Nation’s great oceans.

"Among the activities described are a host of steps to promote sustainable energy development and aquaculture practices—including ensuring that permitting processes for these activities are...."

Here is a report from the private sector's "National Ocean Policy Coalition".  See Action Alert Here!

This massive undertaking -- which will ultimately affect all waterways feeding the Great Lakes and Oceans -- is a regulatory monster created by President Obama early in his first term.  See our original, 2009 report here.  See strategy of NOAA support here.

The oceans, Great Lakes, and all waterways and lands surrounding them are destined to be regulated under a new regime called, ecosystem-based management (EBM).

Our astute, NGP readers can just imagine the havoc that Obama, Kerttula and their massive grass roots constituencies can bring to America's traditional use of our waters.  

Not only does this effort threaten any natural resource activity in Alaska (i.e. which has 3/4 of America's coastline and over 3 million lakes, rivers and streams), but can severely affect every single American.  

The direct effects will be felt by commercial fishermen and others who make a maritime living--and even farmers whose activity on private land can be deemed to affect waters leading into lakes and oceans.  

Indirect effects will descend upon every American who will ultimately pay for the cost of this regulation and with more jobs exported to countries which do not have such regulatory obstacles.

The final insult to our way of life is that this whole, massive effort is unapproved and unfunded by Congress.  

Obama has done it all by Executive Order and memorandum.  It is run under the cover of the White House's Council on Environmental Quality and by his order, dozens of government agencies are indirectly funding the effort -- redirecting their own congressionally approved funds and people to this dangerous activity.

We believe that this is one of the greatest examples to date of Obama's unconstitutional usurpation of Congressional powers.

We also wonder why more Governors and Congressional Delegations are not literally handcuffing themselves to the White House fences until this sort of illegal activity ceases.

Until and unless relief from such usurpation comes from some as yet unidentified champion, we can only conclude that America's rule of law is finished and that we have entered a new era of elected fascists who create law out of thin air by the memorada edicts and Executive Orders.  

Oh, and about DOI's affirmation of Lease Sale 193 yesterday, good luck.

Yes, we have been set up and stung again and again; and this is the latest sting by this administration.

American citizens have, indeed, been played for fools by those they elected.


Commentary: "The Set Up".

Yesterday, the Department of the Interior issued a Record of Decision affirming Chukchi Sea OCS Oil and Gas Lease Sale 193 and the remaining oil and gas leases issued in 2008 as a result of the sale. Press release  (Comment: Now that DOI has finally validated its own lease sale  (i.e. and long ago accepted payment by industry), observers will now watch carefully to see if the regulators deny access through the permitting process.  We hope the outcome is not a statement months or even weeks from now to the effect that, "Our policy is that exploration and development should occur in these areas, but only under responsible conditions.  To date, those applying for permits have not demonstrated that exploration -- much less development -- can occur responsibly in these areas.  Accordingly, the applications for permits are denied."  -dh)

Fox Business News.  

The Alaska Senate passed a bill Tuesday that would temporarily restrict participation by a state-sponsored corporation in an alternate gas pipeline project proposed by Gov. Bill Walker.

The vote followed a failed attempt by legislative leaders and Walker to reach an agreement.

The vote was 13-7, but notice of reconsideration was given, meaning the bill could be voted on again before advancing. It passed the House last week.

Walker has said he would veto the bill. A legislative override would require the support of at least 40 legislators.

Our Quick Takes On Current Alaska Journal of Commerce Headlines:

Hilcorp Energy keeps up spending despite oil price slide  -  More respect and kudos to one of Alaska's great new companies.  -dh

From Brent Greenfield, National Ocean Policy Coalition (Mentioned in commentary, right column.  Please act today.  Note that our preference would be to defund the entire, ocean policy process completely and surgically remove all funding from all agencies devoted to supporting this unfunded government program.  You can support the NOPC letter but we would recommend separate letters to your Congressional delegations recommending total defunding.  -dh)

Our readers:

With Congress set to soon begin drafting bills to fund the federal government for FY 2016, and with National Ocean Policy implementation continuing and very potentially impactful actions currently slated for FY 2016, NOPC has drafted a letter to House and Senate Appropriations Committee leadership in support of language that would achieve a 1-year pause in implementation of two of the policy's most concerning components.  Many of you have signed on to similar letters in the past, and your support is greatly appreciated. 
We are at a pivotal juncture with respect to policy implementation, and demonstrating the maintenance and broadening of support for a time-out will be critical to securing effective congressional action.  To that end, please review the draft text below and let us know by COB Wednesday, April 8 if we can add your organization's name as a signatory.  Also, please let us know if there are other organizations in your network that might be interested in signing on.  Thank you again for all your support.
Brent Greenfield
National Ocean Policy Coalition
2211 Norfolk
Suite 410
Houston, Texas 77098
Dear Chairmen Rogers and Cochran and Ranking Member Lowey and Vice Chairwoman Mikulski:
In connection with the drafting of legislation to fund the federal government for Fiscal Year 2016, the undersigned groups request your support for including language in all appropriations bills that ensures commercial and recreational interests spanning nearly every sector of the U.S. economy are not saddled with additional uncertainty or new regulatory hurdles as a result of implementation of two particular components of the July 2010 Executive Order establishing the National Ocean Policy. 
Among other things, the Executive Order directs a multitude of federal entities to participate in “Coastal and Marine Spatial Planning” (CMSP) in all nine U.S. coastal regions.  CMSP is described as a process "to better determine how the ocean, coasts, and Great Lakes are sustainably used and protected," and the Interior Department has likened CMSP to a “national zoning plan” that “will serve as an overlay” in federal decisions.  Concerns are further heightened given that the geographic coverage of CMSP includes inland bays and estuaries and upland areas as new governmental “Regional Planning Bodies” deem appropriate, and since federal entities will “address priority…ocean management issues associated with marine planning as described in the Executive Order” regardless of whether all states in a region decide not to participate.
In addition to CMSP, the National Ocean Policy requires the federal government to implement “Ecosystem-Based Management” (EBM), which is described as a “fundamental shift” in how the U.S. manages ocean, coastal, and Great Lakes resources.  Among other things, federal entities are required to “[i]ncorporate EBM into Federal agency environmental planning and review processes” by 2016.
Language adopted by the Executive Order states that effective National Ocean Policy implementation would “require clear and easily understood requirements and regulations, where appropriate, that include enforcement as a critical component,”and acknowledges that the policy “may create a level of uncertainty and anxiety among those who rely on these resources and may generate questions about how they align with existing processes, authorities, and budget challenges.”  In order to ensure that further implementation of some of the most concerning and potentially impactful aspects of an initiative that has not been authorized by Congress does not create additional regulatory uncertainty, result in new regulatory hurdles, or siphon away scarce federal dollars from critical and authorized activities, the undersigned groups respectfully request that all appropriations bills include language stating that "None of the funds made available by this Act may be used to further implementation of the coastal and marine spatial planning and ecosystem-based management components of the National Ocean Policy developed under Executive Order 13547."
Including this language will provide Congress with an important opportunity to more closely examine the National Ocean Policy and the full range of its potential impacts before it is fully implemented.  In closing, we appreciate your attention to this issue and respectfully request inclusion of the proposed language in all Fiscal Year 2016 appropriations bills. 

Newsmax by Ken Mandel.  The Keystone pipeline project transports oil from Canada to refineries in Illinois and Texas via eight U.S. states. Completed in 2014, a shortcut known as the Keystone XL was approved by Congress the next year, but vetoed by President Barack Obama.

The debate continues to rage. Here are eight quotes from oil company executives, who stand to benefit from the pipeline's construction: 

1. "Anything could happen, we don't know, but we remain confident that when Keystone is ultimately built, it will be the safest pipeline that has ever been constructed in this country." — Andrew Craig, TransCanada's land manager for Keystone projects and development, told NBC News. 

Read More....

Forbes (3/27/15) editorializes: “This Saturday marks the seventh annual observance of “Human Achievement Hour,” a celebration of technology and prosperity hosted by my organization, the Competitive Enterprise Institute. Originally created as an alternative to the World Wildlife Fund’s “Earth Hour” campaign (which urges people to turn off their lights in the name of environmental conservation), Human Achievement Hour counters widespread predictions of environmental and societal doom.”

Alaska Economic Update- Part 4  -  Parts 1-4 Here

Posted: 31 Mar 2015 11:21 AM PDT

By Mark Edwards

Today we wrap up our series on the Alaska Economic Update. Over the past three posts, we have looked at oil prices, jobs, and population. We wrap things up today with the housing marketing and the building environment. For the complete Alaska Economic Update as well as other important studies, visit our ‘Resources’ section.

Home lending activity flat - The Alaska Housing Finance Corporation (AHFC) released its third quarter report on Alaska housing indicators. It tracks new loan activity for single family homes and condominiums in Alaska.  The data is based on a survey representing approximately 95% of mortgage lenders in Alaska and also includes AHFC loans. The survey covered mortgage lending activity in the first nine months of 2014.

It reported 6,889 loans were originated statewide for single family homes and condominiums for a total amount of $1.8 billion. This is nearly identical to the volume in the first 9 months of 2013. Loans were done with an average down payment of 11% for the last five years.  Single family homes accounted for 87% of statewide mortgage lending activity with 52% of those loans occurring in Anchorage. The Mat-Su contributed 18% of the volume, 10% in Fairbanks, 8% in Kenai, 5% Juneau, 2% Kodiak, and 1% in Ketchikan.

10% of total mortgage activity for the quarter was for condominiums and only 3% was multi-family.  91% of condominiums were financed in Anchorage. Juneau accounted for 5%, and the Mat-Su, Kenai and Fairbanks 1%. 

Refinance activity slowed rapidly in 2014, but may rise as interest rates are falling again - 30 year conventional fixed interest rate mortgage loans have been getting less expensive for three decades.  In 1981 they peaked at 16.6% and have undergone a slow and steady decline ever since.  In early 2009 rates dipped under 5% on average for the first time and a surge in refinance activity began. 

According to AHFC statistics, there was less than $200 million in refinance loans completed per quarter in Alaska in 2006 and 2007.  In 2008, the average rose to $400 million.  Then in the first quarter of 2009 the activity spiked to $1.4 billion, followed by $1.2 billion in the second quarter.  During this time, the average 30 year interest rate declined nearly 1.5% in six months. 

Graph 1

The refinance pace slowed somewhat in the last half of 2009, but still finished the year with $3.7 billion in refinanced mortgage loans according to AHFC statistics.  In 2010, the refinance volume declined to $2.4 billion, followed by $2.1 billion in 2011.  2012 saw an unexpected decrease in interest rates again to an all-time historic low of 3.3% by the end of the year.  This led to an increase to $3.1 billion in refinance activity. 

Rates increased throughout 2013 and you can see on the far right of the graph, the result has been a steep drop off in refinance activity.  Rates began declining again last year and finished 2014 at 3.86% on average.  AHFC data is only available through the third quarter of 2014 at this time, so we have not yet seen the year end results.  Rates continued lower in February to 3.71%.  This should be a positive trend for both home sales and refinance activity this year.

Housing statistics still good relative to the U.S. – The recently released survey by the Mortgage Bankers Association shows that Alaska continues to have some of the lowest levels of foreclosures and delinquencies on residential mortgage loans in the United States. Through the third quarter of 2014, Alaska ranked 5th and 7th best in the nation out of 50 states in foreclosures and delinquencies of all loan types.

The total inventory of foreclosures in process is 0.9% in Alaska, while the country has a much larger lingering foreclosure inventory at 2.4% due to higher rates during the recession and longer resolution times. These rates are an improvement from four years ago when Alaska’s rate was 1.4% and the U.S. foreclosure rate was 4.6%.

Delinquent loans are more than 30 days past due, but not yet in foreclosure. Alaska is fifth best behind North Dakota, South Dakota, Montana and Hawaii in the overall level of delinquent loans. Alaska’s delinquency rate is 3.6%, while the U.S. average is 6% for all loan types. This is an improvement for Alaska from 4.8% four years ago. The U.S. delinquency rate has also come down more dramatically from 9.4% at this time four years ago.

Graph 2

Subprime lending to traditionally non-qualified borrowers was a large contributing factor to the national mortgage problems. The survey covers 95,176 mortgages in Alaska. 6,110 or 6% were considered subprime, compared to 9% nationally. The rate of delinquencies and foreclosures on subprime loans is significantly higher. However, Alaska is in a far better position and again leads the nation as having the lowest level of foreclosures and is second in delinquencies for this important category. Subprime foreclosures in Alaska are at 2% while the national average is 9.8%. Alaska’s subprime delinquency rate is 9.4% compared to the national average of 19.3%.

Building permits up 430 units in 2014, but still historically low - According to the U.S. Census Bureau, the number of building permits for new, privately owned housing of 1 to 5 unit buildings remained low for the 8th straight year.  It had been under 1,000 units since 2007, but in 2013 it grew 9% to 1,081.  Last year saw a dramatic jump up to 1,509.  However, this is still half the level seen 10 years ago.

Growth in single family homes increased from 877 to 1,114 last year.  The number of duplexes permitted fell from 66 to 50.  The number of structures with three or four living units decreased slightly from 49 to 45.

The other major growth area beyond single family homes was in multi-family.  The number of structures with five or more units climbed from 10 in 2013 to 33 in 2014.  In terms of housing units that meant a growth from 87 to 300 last year.  The biggest challenge has been making new construction affordable enough to meet buyer’s income levels.  There is a shortage of low cost housing in Anchorage.  Vacancy factors are very low and the number of existing homes under $350,000 is in short supply.  It appears builders have started to take more risk in this market segment, likely aided to some extent by government subsidy programs.  Anchorage is expected to follow other growing cities by becoming denser, building vertical and redeveloping older properties.

Graph 3

Graph 4


3-31-15 Legislative Leaders Focus On Gasline Details - Commentary, "Proud as Quixote"

31 March 2015 2:30am

We want to work with our new Governor to progress this great State forward, especially knowing

Our Commentary:

The two legislators above created the Alaska Gasline Development Corporation (AGDC) concept as an insurance policy for transporting Alaska North Slope (ANS) gas to citizens and to an export facility. 

The current governor - who opposed the AGDC/ASAP gasline concept before he supported it .... more coming....

...en route from South America to a stop in Mexico City, then two days in LA, then home to Anchorage. 

We apologize if the posts are a little more infrequent than usual.

Thank you!



the difficult times before us. We respect that he is our Governor, duly elected by Alaskans, and we appreciate the respectful acknowledgement that we, too, are representatives duly elected by Alaskans. We all have Alaskans’ best interests at heart, and want a future of prosperity and opportunity in our State.

While we believe we share many of the same goals and values as the Governor, we differ as to the approach to natural gas development that will deliver the greatest benefits to Alaskans.

Let us be very clear about what we want: We want to commercialize natural gas for the highest value possible, for the Permanent Fund and for the Treasury, so that every Alaskan may share in the wealth of our resources. We want affordable natural gas to flow to our communities that still suffer under the fluctuating prices of fuel oil. And we want a project that includes the necessary elements — including participation of the North Slope producers and the State — for real success, as soon as responsible project engineering and -permitting allows.

The Legislature found that project with the Alaska LNG Project, in which the state is a 25 percent owner.

But we also preserved our ability to pursue a different project, if the Alaska LNG Project does not progress into the next development stage. We have that in the 36-inch line that the Alaska Gasline Development Corporation has developed. It is in prime position to alter if necessary — and if the Alaska LNG Project does not prove viable, we’ll know what adaptations we must make in order to offer a viable project. To increase its size now, to an arbitrary, unsupported volume, is not a prudent use of funds. That does not provide us a viable alternative should Alaska LNG not progress.

The Governor has indicated he sees success in a different framework. Unfortunately, to date, neither he nor his administration have shared those details with us and with the Alaska public. He submitted a letter to the Senate Resources Committee on Friday with some explanations for his alternative approach, and we appreciate that. But Alaskans need to know details. What about the LNG component — who owns that? And the pipeline — is the state to shoulder 100 percent of the risk and cost? Who will ship gas, if one or more of the producers remain engaged in Alaska LNG? If all 3 producers are not partners, how will the state determine its gas share — and is it enough to support our level of equity ownership? We want to better understand the terms and structure of his proposal in order to conduct the rigorous vetting and analysis that will allow us to make an informed, responsible decision on a forward course.

The government process is about thorough, open review of ideas, in the form of legislation, that leads to policies. We hold hearings; explore details; call for experts to analyze and model impacts; vet each and every aspect; hear from the public; undertake legal review; and, finally, debate on whether a policy should be adopted.

It is how Alaskans came to be owners of the Alaska LNG Project; through a deliberate, well-investigated decision.

Certainly, we would have preferred not to have introduced legislation — House Bill 132 — to temporarily restrict an alternative, conflicting approach and to keep Alaska LNG on track. However, we were compelled to, out of grave concern that the Administration’s approach would threaten the viability of the tremendous opportunity before Alaska in the Alaska LNG Project. A project that is on time, on budget, and on track to success. And unfortunately, the few details offered by the Governor’s letter reaffirm that it is more imperative than ever to pass HB 132, as his approach clearly creates a competing alternative that threatens the state’s investment in and the success of Alaska LNG.

The details of any project are crucial. At stake are the value of our royalty gas, which feeds the Permanent Fund; our state share in production, property and income taxes that support the treasury; the availability and cost of gas for Alaskans; and future North Slope resource development. Variations on the SB 138 framework can have significant consequences. These details were not part of the Governor’s letter — and we must have these details in order to make a deliberative decision on natural gas policy, and the responsible fiscal choices our constituents demand.

We want to work together on a path forward that is responsible, allows for public understanding and input, and does not recklessly waste state money pursuing options that lack a proven, commercial foundation. Competing with ourselves, while confusing our partners and the markets, is not in our best interests.

Speaker of the House Mike Chenault represents Niksiki and Rep. Mike Hawker represents Anchorage in the Alaska House of Representatives.

Syndicate content