Commentary

Another Critical Deadline for Comment; Please Do.  Here's Why:   Dear Readers:   The Obama administration threatens to approve and implement a "Zoning of The Oceans" -- by this Spring, well before the presidential election -- and further hinder our freedom and ability to create jobs and achieve energy independence by developing our own fossil and renewable energy, commercial fishing, recreational and other resources and activities (i.e. like ocean transportation).  See our earlier comments on this Obama initiative taken by Executive Order without Congressional authorization and which places an additional regulatory overlay across our (i.e. already highly regulated) oceans and water systems flowing into them.  It is truly a case of, "Freedom Supressed and Government Gone Wild", 1, 2, 3.  While the White House says, "Need for Congressional Authorization is a Myth", the President and his chicken house full of crafty, activist foxes are truly annexing Congressional authority by calling his zoning initiative a restructuring of government services.  It is like a belligerent, passive-aggressive teenager who says, "I was home by midnight. Technically, I didn't disobey you when I drove with my friends to Chicago.  I didn't tell you we wouldn't go there and, remember, I was home by midnight."   The National Ocean Policy Draft Implementation Plan proposes more than 53 federal actions and nearly 300 milestones that call for, among other things: A national zoning plan that could cordon off vast areas of the ocean from human activity and which will be developed by regional zoning boards comprised of government bureaucrats; New studies that could unnecessarily and indefinitely delay commercial and recreational activities, effectively halting those activities; A new federal land grab of millions of acres of onshore and offshore areas; and Regulations that apply to both inland and water-based activities The National Ocean Council, which spends many millions of dollars of agencies Obama has ordered to participate is currently accepting comments on the Draft Implementation Plan.  The National Ocean Policy has already been cited as justification in part for not allowing any Outer Continental Shelf oil and gas leasing to take place outside the Gulf of Mexico and limited areas in Alaska until at least 2017.  Implementation of the National Ocean Policy, as currently proposed, will limit domestic energy development and other valid and responsible use of the oceans -- including wind energy projects -- and will further harm our nation’s economy.     IS THE CONGRESS SLEEPING AS ITS AUTHORITY IS BEING USURPED BY AN OVERREACHING EXECUTIVE? Make sure the National Ocean Council hears from you before its comment deadline, next Monday, February 27.  Copy Members of Congress.  Put your comment in the comment space below or send it to us for later publication.  Feel free to edit the Consumer Energy Alliance letter here as you see fit.  For more information on how these policies may affect you, listen to the National Ocean Policy Coalition.   Never give up. Dave Harbour Publisher Northern Gas Pipelines

AP-

Canadian Natural Gas Declines as Mild US Weather Pares Demand, Bloomberg - Pipeline Flows Gas was flowing at a daily rate of 2.53 billion cubic feet at Empress, Alberta, where the fuel is transferred to TransCanada's main line. At McNeil, Saskatchewan, where gas is transferred to  the Northern Border Pipeline for shipment to ...

ADN.  BP says it's working to meet customer demand as its Cherry Point refinery in Washington state remains idle following a fire. 

 Bloomberg: Oil profits slide fastest since Lehman collapse on gas - Profits for the biggest U.S. energy producers including Exxon Mobil Corp. (XOM) are poised to decline the most since the financial meltdown of 2008-09 as the drilling technique known as fracking collapses natural gas prices. Exxon and Chesapeake Energy Corp. (CHK), which today reports 2011 earnings, will see net income in 2012 slide about 8 percent and 10 percent, respectively, according to the mean of analyst estimates compiled by Bloomberg. 

Alaska State Senator Cathy Giessel (NGP Photo) says to the US House of Representatives Rules Committee, "STOP! Please do not strip the Arctic National Wildlife Refuge (ANWR) provision from HR 7. We must open a small portion of the ANWR to responsible oil and gas development."  See video of Washington DC visit of House Speaker Mike Chenault, below.

Vancouver Sun by Dina O'Meara.  TransCanada Corp. has set back the launch of the Keystone XL bitumen pipeline until early 2015, saying it expects to receive approval for the controversial line by early 2013.

New Report: Institute for Energy Research: In 1980, official estimates of proved oil reserves in the United States stood at roughly 30 billion barrels. Yet over the past 30 years, more than 77 billion barrels of oil have been produced here. In other words, over the last 30 years, the United States produced more than two and a half times the proved reserves we thought we had available in 1980. Thanks to new and continuing innovations in exploration and production technology, there’s every reason to believe that today’s estimates of reserves are only a fraction of what will be produced and delivered tomorrow—not only here in the United States, but across the entire North American continent.

Commentary: What a great way to help our nation prosper through free enterprise. We can vouch for the authors, having written a story about them: http://www.northerngaspipelines.com/content/statoil-enters-alaska-alliance-launches-oil-tax-moderation-program-not-evil-just-wrong 

FrackNation 

www.kickstarter.com 

FrackNation is a feature documentary that will tell the truth about fracking for natural gas in US and globally.

 

Governor's Office: United States Federal District Court Judge Russell Holland has issued an order recognizing the State of Alaska’s interest in challenging federal authority over state-owned navigable rivers and submerged lands.  The state is now a party to a lawsuit by plaintiff, John Sturgeon (NGP Photo-R), an Anchorage resident challenging the authority of the National Park Service to regulate activities on state-owned waters within national parks and preserves in Alaska. “My administration will continue to aggressively push back on federal overreach, and efforts to control Alaskans’ ability to travel on rivers and waterways,” Governor Sean Parnell (NGP Photo) said. “I am pleased the court recognized Alaska’s strong interest in this issue over the objections of the federal government to our participation in the case.”

SEE THIS WEEK'S VIDEO AS members of the Alaska House of Representatives visit Washington, D.C. to advocate for H.R. 7, the American Energy and Infrastructure Jobs Act. The House will consider the bill this week, which among other provisions, would open less than 3% of the Arctic National Wildlife Refuge (ANWR) in the North Slope to responsible energy production. This small portion of ANWR was specifically set aside by President Jimmy Carter and Congress in 1980 for oil and natural gas development.  During an interview with Natural Resources Committee staff, Alaska House Speaker Mike Chenault (NGP Photo-L) and Representative Reggie Joule (NGP Photo) discussed the bipartisan, majority support in Alaska for opening this area to American energy production. 

ADN by Lisa Demer.  Battle lines are hardening in the Legislature over oil taxes, with Gov. Sean Parnell saying Tuesday that he remains firmly committed to his legislation rolling back taxes, and state senators just as sure that they are right to reject his strategy.

CBC News: Most Albertans rate the oil and gas industry — and the provincial government — highly when it comes to creating jobs, according to a poll done for CBC News.  But almost a third of Albertans think both government and the oil and gas industry could do a better job communicating with the public.

Commentary by Dave Harbour.  At noon in Anchorage, yesterday, citizens were asked for testimony regarding a draft environmental impact statement (DEIS) published by the National Marine Fisheries Service (NMFS).  

NMFS Chief Michael Payne and DEIS Project Manager Candice Nachman (NGP Photos) briefed the audience on the DEIS and how it addresses the "Effects of Oil and Gas Activities in the Arctic Ocean". NMFS is the lead agency for this EIS. The Bureau of Ocean Energy Management (BOEM) and the North Slope Borough (NSB) are cooperating agencies on the EIS (In answer to a question from the author, Nachman said the State of Alaska was not a "Cooperating Agency").

An official 45-day comment period on the document has been extended to Tuesday, February 28. Public meetings were held through February 9 on the North Slope, and yesterday in Anchorage.  Go to the Resource Development Council for Alaska (RDC) Website for information on how citizens can file comments to assist in building a good record.  During the noon hour, yesterday, witnesses favoring Arctic OCS development and opposing the 'federal overreaching jurisdiction of NMFS' represented by this DEIS outnumbered environmental activist witnesses by about 2 to 1 but one might expect Lower 48 environmental networks to generate thousands of 'seminar' comments urging a stop to Arctic energy exploration.

Snipets from several presentations included: Peter Macksey (NGP Photo-r) observing that, "We seem to put in place roadblocks to any development, mostly by creating arbitrary and unclear mitigation measures that are not clearly defined...."  Consumer Energy Alliance-Alaska president Steve Pratt (NGP Photo-l) CEA-Alaska said he believes that Alaska’s contributions to a balanced energy policy cannot be overstated, but that, "the Draft Environmental Impact Statement at issue here may act against accomplishment of a balanced energy policy."  He complimented President Obama's State of the Union message that,  “Tonight, I’m directing my administration to open more than 75 percent of our potential offshore oil-and-gas resources.”  Pratt went on to observe that, "As we understand it, the Draft Environmental Impact Statement under consideration has the potential to close off the very resources it is in the national interest to open for exploration and development."    John Stugeon (NGP Photo-r) said adoption of the restrictions contained in the DEIS would "severely compromise" the economics of Arctic energy exploration.  

Shell Exploration and Production representative, Lucas Frances (NGP Photo) summarized the concern lessees have for the NMFS environmental analysis: "There are a variety of elements in the current Draft EIS," Frances said, "that, if carried forward through the Record of Decision, would significantly constrain—and possibly preclude—future offshore oil and gas exploration."  Frances asked that the NMFS withdraw the DEIS, initiate a new DEIS process and conduct a workshop with lessees to jointly prepare exploration alternatives. 

As an observer, I was struck by the early tenor of the meeting established when NMFS Chief Payne said that the National Environmental Policy Act (NEPA), "is there to allow us to make a decision on the way we want to proceed."  This citizen might have been more comforted had the agency head said, "NEPA allows us to make a balanced decision that both protects critical environmental values while allowing critical energy exploration to proceed."  If stated accurately, Payne's statement leaves one with a clear conclusion that the agency will do whatever it wants to do...without regard to balancing important values."

Also not lost on this listener was the constant reference in the meeting by staff and environmentalists to subsistence values: as if summer exploration activitiy and the lifesaving jobs it produces somehow prevent subsistence hunters from harvesting marine mammals.  

Alaska's North Slope industry experience has shown that: 1) industry prevents poaching and other hunting abuses, 2) protected animals increase in numbers for the benefit of subsistence hunters, 3) the presence of industry provides safety and lifesaving resources for subsistence hunters, and 4) many subsistence hunters make a living by working for the industry that provides these many other benefits.  

If agencies like NMFS are to better reach 'balanced' decisions, they should be fully considering the practical local benefits of exploration as noted above, as well as the overal benefit to American employment, affordable domestic fuel supplies, national security and financial deficits now threatening the economic survival of our republic.

Last night in Anchorage, citizens gave opinions to FERC regarding an "Environmental review public meeting for the Alaska Pipeline Project".  The Federal Coordinator's office produced a video of the event here, which includes an updated briefing on the project by David Swearington of FERC.  An expensive (from a taxpayer perspective) bevy of other officials accompanied the road show, including some representatives from cooperating agencies: the Department of Transportation, Corps of Engineers, Bureau of Land Management, Office of the Federal Coordinator, Fish & Wildlife Service, Environmental Protection Agency, Alaska Pipeline Coordinator's Office, Geological Survey, Eilson Air Force Base.  Supporting the FERC were consultants from Argonne National Labs and a Court reporter. 

ADN by Lisa Demer.  Gov. Sean Parnell's goal of once again seeing a million barrels of oil course through the trans-Alaska pipeline each day would require an investment of $7.5 billion a year, the Legislature's oil and gas consultant Pedro van Meurs (NGP Photo) told two state Senate committees Monday.  Here is Dr. van Meurs' slide presentation with all the facts and figures.

Fairbanks News Miner/AP by Becky Bohrer.  Gov. Sean Parnell's goal of nearly doubling the flow of oil through the trans-Alaska pipeline could be achieved over the next 10 to 15 years - but not without major fiscal and policy changes, a consultant said Monday.  Pedro van Meurs, an oil and gas consultant, told a joint hearing of the Senate Resources and Finance committees that Parnell's tax-cut bill "does not even come close" to going far enough to hit the Republican governor's goal of 1 million barrels a day. He said "more elaborate" legislation is needed if Alaska wants significant increases in production. 

NARUC, Washington, D.C. (Report and comment by Dave Harbour).  Yesterday, NARUC president David Wright (NGP Photo) introduced Alaska Senator Lisa Murkowski (NGP Photo) to about 1400 attending the winter meeting at the Renaissance Hotel here of the National Association of Regulatory Utility Commissioners.  “Your association has now been a major contributor to the development of energy policy for almost 125 years", Murkowski said.  "We count on you to present your views in the federal arena,  as you have always done, with vigor and precision.  Regulatory Commissioners have a solemn duty to balance the interests and needs of customers and investors according to the rule of law.  It is appropriate that your organization has the scales of justice  on its seal."  We note that current testimony before the Alaska State Senate, linked below, points to decisions reached by the Regulatory Commission of Alaska on pipeline tariff issues.  “Without principled and judicious regulation," she continued, "maintaining and prudently expanding critical energy infrastructure would be impossible. Your responsibilities, always weighty,  are now more challenging than ever.  Today you must navigate a weak economy, and a host of new and ever more demanding environmental regulations.  And as if that weren’t enough, you have an additional task.  Like all of us in public life with responsibility  for energy policy, you must find ways to reasonably balance our nation’s energy needs with our environmental concerns – and the sometimes very real conflicts that emerge from the laws and policies governing each of those areas."
(Note: we are preparing this enroute Washington-Anchorage and will complete the report as soon as possible.  -dh)

WASHINGTON, D.C.,  - Spearheaded by Natural Resources Committee Members Bill Flores (TX-17) and Rob Wittman (VA-01), 182 Members yesterday sent a bipartisan letter to Department of the Interior Secretary Ken Salazar (NGP Photo) requesting new, expanded access to offshore energy production in order to create new American jobs, reduce our reliance on foreign energy and generate new revenue.  Last November, the Obama Administration released a draft five year plan that closes the majority of the OCS to new energy production through 2017. The draft plan includes lease sales in the Gulf of Mexico and the Arctic—leaving portions of Alaska, the entire Atlantic and Pacific coasts off-limits to new energy production and job creation.  Next week the House is expected to consider the American Energy and Infrastructure Jobs Act (H.R. 7), which would lift President Obama’s offshore drilling ban and require the Administration to lease offshore areas containing the most oil and natural gas.  Click here to view a copy of the signed letter.

Fairbanks News Miner, by Max Buxton.  Last week, Fairbanks Rep. Bob Miller announced an ambitious goal of taking a hard look at building a pipeline from Cook Inlet to Fairbanks in order to bring the clean-burning fuel into the Interior years before construction could even begin on an in-state line.  The only problem, however, that fellow Fairbanks Rep. Steve Thompson brought up is the state already conducted a study on that very issue years ago.  Called the Beluga to Fairbanks pipeline, the Alaska Natural Gas Development Authority under the direction of former Gov. Sarah Palin made some substantial headway on designing, studying and building a pipeline to the Interior before it was called off in 2010.  ANGDA acting Chief Financial Officer Kirsten Sikora said the project came close to becoming a reality before concerns over lagging Cook Inlet gas reserves mothballed any hopes of bringing Cook Inlet natural gas to Fairbanks.  “We would’ve already had shovels in the dirt if we had continued on,” she said. “But in fairness the global markets have been changing, it’s been a roller coaster ride over the last few years.” 

In a press release last night, Alaska State Senate Majority Press Secretary Carolyn Kuckertz noted that, members heard the beginning of a presentation from Robin Brena, Counsel for the Fairbanks North Star Borough and Lead Counsel for the Municipalities in the 2007-09 Assessed Valuations Case for TAPS, and Craig Richards, Counsel for the City of Valdez and Co-Counsel for the Municipalities in the 2007-09 Assessed Valuations Case for TAPS.  To watch the entire hearing, click here.  Mr. Brena and Mr. Richards are scheduled to continue their presentation to the Senate Resources Committee at 3:30pm today.

A Bering Strait Vessel Traffic Service: Critical Infrastructure for an Opening Arctic (Part I)- The Arctic Institute, Robin Strader - Nations and multi-national corporations are positioning themselves to take full advantage of the Arctic’s Northwest Passage (NWP) and Northern Sea Route (NSR). However, there is every little safety infrastructure in place to ensure incident-free transit. Both of these Sea Lines of Communication terminate in the Bering Strait, the gateway to the Arctic. In this critical water space it is essential the United States and Russia begin considering how to manage traffic through this strategic choke point.

Another View: U.S. would be wise to push oil production - Green Bay Press Gazette - Canada's extraction and sale of its massive oil deposits. Getting that energy supply to market will be slowed, and the U.S. may reap less of an economic benefit from something that has the potential to turn North America into what Citigroup Global Markets calls "the new Middle East.

Shell still hopes to drill this summer in Arctic waters – The (Tacoma) News Tribune, Dan Joling - The federal Bureau of Ocean Energy Management in December approved Shell's exploration plan for the Chukchi -- with a major caveat. Shell must stop drilling into hydrocarbon zones 38 days before ice is likely to move in, roughly Sept. 24, to have time to fix a wellhead blowout.

Other NARUC Winter Meeting Photos - 2012

 
Commissioner Bob Anthony
 

 
Jim Andrews
  

 
Sharon Reishus, 

 
 

 
More photos coming....
 

Personal Commentary:  This morning Senator Lisa Murkowski (NGP Photo, 2-6-12) is scheduled to address the National Association of Regulatory Utility Commissioners (NARUC) on energy issues at Washington D.C.'s Renaissance Hotel.   
 
The program begins this morning with Pulitzer Prize-winning author Daniel Yergin, providing, 'an overview of the ongoing quest for energy resources in an increasingly competitive world,' according to the NARUC program.  Yergin's presentation will be followed by Murkowski's panel, also including Oregon's Senator Ron Wyden, West Virginia's Senator Joe Manchin and Congressman James Clyburn, also father of FCC Commissioner Mignon Clyburn (former South Carolina Commissioner)
 
(Additional personal note: While serving on the Regulatory Commission of Alaska, your author served as Co-Vice Chairman of NARUC's Gas Committee, NARUC's official representative to the Interstate Oil and Gas Compact Commission (IOGCC) and Chairman of the Gas Committee, Western Conference of Public Service Commissions.  In those capacities, your author participated in passage of NARUC/IOGCC resolutions benefiting the country and Alaska, dealing with the Alaska natural gas pipeline project, long term contracting to benefit energy infrastructure and other domestic energy support issues.)  -dh

Alaska Dispatch by Scott Woodham.  Alaska has issued a key air quality control permit needed to restart the long-dormant Healy Clean Coal Plant, a 50-megawatt power plant about 90 miles south of Fairbanks that has sat idle more than a decade and been called one of Alaska's most conspicuous boondoggles.

Feds' new oil shale plan will keep activity off Western land - Deseret News, Catherine Tsai - But the move drew a sharply critical response from Utah Republican Gov. Gary Herbert . "I see absolutely no benefit. This nonsensical, bass-ackwards, peek-a-boo policy is nothing more than political posturing by over-reaching federal bureaucrats," the governor said in a news release. "With no science and no data, and with a wave of their federal bureaucratic magic wand, they just take the bulk of the acreage off the market, stifle innovation, and demonstrate, yet again, that this administration is patently hostile toward even the possible development of much needed energy resources."
 
Keystone pipeline is ready to come through Oklahoma - NewsOK, Megan Rolland - “But I got to thinking. You put all these people to work, and these people have got to go to work,” Elwood said. Now she hopes Congress will find a way to override the president's decision not to let the pipeline cross the United States.
 
Eastern Montana mulls Keystone XL - Billings Gazette, Lorna Thackeray - Support for the $7 billion project is strong across Eastern Montana, where the pipeline will traverse 282 miles through six counties. But it's not unanimous, especially among some landowners who say they have not been provided with adequate safety plans or environmental assurances.
 
Oil taxes highlight busy week for Alaska lawmakers - Anchorage Daily News, Becky Bohrer - The oil tax debate overshadows all others this session because of the significance of oil to Alaska's economy. Oil provides about 90 percent of the state's unrestricted revenue but declining production has policy makers worried and looking for ways to reverse the trend.

 Weekly Notes From Office of the Federal Coordinator, Alaska Natural Gas Transportation System: 

Tax reform critics are continuing to try and bluff their fellow Alaskans into believing the state's oil tax regime is competitive. For the sake of Alaska's economic well being, they should start being honest about the cards we're playing. The fact is lawmakers are playing ACES high.  One of the bedrock arguments proffered by critics who oppose reforming oil taxes is that compared to other oil producing regions, Alaska is right in the middle. This is false.  ***  o put this into perspective; we're expecting Alaska's producers to invest billions to increase oil production, under the highest tax structure in North America as well as the fifth highest in the world.

Alaska Legislators Propose Boost for In-State Gas Pipeline, 24 introduced a bill package that supports the state-created Alaska Gasline Development Corp. AGDC is overseeing and facilitating the planning of an in- state ...

Near-term pipeline plans grow, longer-term projects sag, Oil & Gas Journal, By Christopher E. Smith.  Planned pipeline construction to be completed in 2012 rose 6.7% from the previous year, with increases in planned crude and natural gas pipelines more than countering sharply reduced products pipeline construction plans.  

Russia's Gazprom says unable to pump extra gas to Europe, Yahoo!7 News, Men work on a gas pipeline in northern Russia. Gazprom said on Saturday it could not pump additional gas to Western Europe amid a cold snap, after EU officials and energy firms said the Russian giant's deliveries had dropped in several states.