From Governor Parnell's Office. Following the close of the first session of the 28th Alaska Legislature, Governor Sean Parnell (NGP Photo) today thanked legislators and highlighted the successful passage of many of his key priorities to improve Alaska. Reforming Alaska’s oil tax structure, providing cheaper energy to Interior and rural communities, reducing payroll tax increases, exercising fiscal restraint, and protecting Alaskan families led the governor’s agenda this session.
Calgary Herald by James Wood. Prime Minister Stephen Harper said Thursday that Ottawa and Alberta are taking a “Team Canada” approach when it comes to getting the controversial Keystone XL pipeline approved by the United States government. And he offered some praise for Premier Alison Redford, who has returned from a two-day trip to Washington D.C. where she touted the environmental record of Alberta and Canada — along with the merits of Keystone, a cross-border pipeline proposed by Calgary-based TransCanada which is intended to ship oil from northern Alberta to the U.S. Gulf Coast.
US Upstream by Tonya Zelinsky. The recent decision makes the AGDC a stand-alone corporation, giving it the tools to move forward on its plans for the US$7.5-billion Alaska Stand-Alone Pipeline (ASAP), which would connect North Slope gas with Alaska tidewater.
Senate panel advances in-state gas line - San Francisco Chronicle - ... on a bill aimed at advancing an in-state natural gas pipeline. The Senate Finance Committee advanced its version of HB4 Thursday. It contains provisions that supporters say the Alaska Gasline Development Corp. needs to get a project to an open season
Energy issues on floor of House, Senate; committee tables oil tax - Alaskajournal.com - In the Senate, a bill making changes to statutes governing an in-state gas pipeline project will be voted on. House Bill 4 makes technical changes in laws governing the Alaska Gasline Development Corp., the state corporation formed to pursue an in ...
Bill to shift Knik bridge construction to AHFC doesn't move - Anchorage Daily News - Costello's amendment creates a new public corporation inside AHFC, the Knik Crossing Development Corp. That follows the model for the Alaska Gasline Development Corp., created by Fauske inside the AHFC when he picked up that project in 2010.
Resource Development Council for Alaska (RDC) Urges Oil Tax Reform Support As Legislature Moves Toward Adjournment!
Senate Finance Committee Released Oil Tax Reform Bill Yesterday.
RDC issued the following call to action yesterday:
Robert Dillon (NGP Photo) of Senator Lisa Murkowski's Energy Committee sends us the following note which should once again demonstrate to Alaska lawmakers that Alaska's energy reserves are not unique and must be competitive if Alaska is to prosper. -dh
ICYMI: The scientific body responsible for evaluating our nation’s recoverable natural gas resources this week released a report showing future gas supply estimates increased by 22.1 percent since 2010 to a total of 2,688 trillion cubic feet.
Tonight Is Another Big Night, For Those Who Care About Alaska's Economic Future!
The Government Gas Pipeline
Late yesterday, we followed the Senate Finance Committee review of the Alaska Gasline Development Corporation's answers to questions about the pending, HB4 that would expand AGDC's powers and infuse it with operating capital. (Watch the video. Photo: House Speaker Mike Chenault.)
We have always supported the concept of this project as an insurance policy for Interior and South Central Alaska electric power and space heating consumers. This is because Cook Inlet gas supplies are dangerously low, a fact exacerbated by a regulatory decision six years ago (i.e. which has likely cost ratepayers over $.5 billion in unnecessary natural gas expense since then.)
Enstar, the local gas distributor, has worked hard to safeguard its customers from gas shortages. It has aggressively pursued more gas supply contracts, built a gas storage facility and investigated new gas supplies--from Prudhoe Bay to potential gas imports. Still, during a cold winter the actual deliverability of supply could push available supplies beyond the breaking point. Every year, the threat of a gas shortage grows.
The AGDC project involves a 737 mile pipeline from Prudhoe Bay to Southcentral Alaska, after winding its way by Fairbanks.
The lion's share of its right of way work is done and its engineering work is moving steadily toward a potential 'open season' wherein those interested in the gas can bid on pipeline capacity to move purchased gas.
While a government owned pipeline concept is controversial, running out of natural gas is unacceptable. If sufficient new gas reserves are proven to exist in Southcental Alaska, the AGDC project could be terminated. But if there is no AGDC insurance policy and more gas is not found, the old cliché about, "freezing in the dark", comes to mind.
During the hearing yesterday, several witnesses distinguished themselves. The HB 4 sponsors are House Speaker Mike Chenault (NGP Photo, above) and Representative Mike Hawker (NGP Photo with Rena Delbridge). Hawker thanked Senators for their complete hearing of the issues while Chenault described the compelling need for the project to safeguard citizens. Hawker's staff executive, Rena Delbridge, artfully briefed the committee on all current issues related to the bill before them. Frank Richards, representing AGDC, offered highly credible, technical briefings and responses to questions.
As our readers know, we have followed Arctic gas pipeline issues for many decades. We have seen many projects come and go.
We briefly worked with AGDC and continue to believe that the project is closer to becoming reality than any of its cousins for several reasons:
This is not a case of a heavy handed government saying, "We are going to create a gas pipeline bureaucracy come heck or high water".
Rather, this is a case of government exercising its proper role of protecting citizens.
Our hat is off to the dedicated public officials who have developed the vision, protected and remained focused on the mission and worked so hard to so successfully overcome political technical and financial obstacles.
At this writing, HB 4 hasn't received final approval. We expect it will. When it is the law of the land, the citizens will have been well served.
To NGP Readers:
Here are Consumer Energy Alliance's earlier comments on the EIS, for your reference.
CEA's general concern is that the proposed mitigation measures will limit OCS exploration activity without any significant benefits for the local marine mammals.
NMFS should focus on cooperative mitigation measures with companies – such as Shell’s efforts to suspend operations in the Beaufort during whaling season – as opposed to broadly limiting activity.
Note: this is the kind of comment opportunity that badly needs elected officials from throughout Alaska submitting comments for the record. Otherwise, the record will not be balanced nor will it reflect the opinion of Alaska's elected leaders.
In honor of her service and life we provide some of Margaret Thatcher's quotes. Not included is this one, perhaps the greatest of all: “The problem with socialism is that you eventually run out of other people's money.” Here is a great story. -dh
Last week, NGP reader, Dawn Patience, reminded us of a milestone that quietly passed Alaska by earlier this year, perhaps lost in the intensity of oil tax reform and intrastate gas supply project debates. In early 2013, Alaska saw production of the 12 billionth barrel of crude oil from the North Slope initial production area. Here's the link to that story, told by Frank Baker.
Today, Snowflake Rebellion author Tom Brennan (NGP Photo) and I will review this history, a Canadian history 'tie-in" and related current events with Dorene Lorenz (NGP Photo) of Your Alaska Link. If you don't have a TV at work, and wish to tune in at 4 p.m., you can catch us on a live stream, here, from anywhere in the world. Ain't technology great! -dh
P.S. From the News Miner/AP: The end is near. Right? The Legislature is scheduled to adjourn from its 90-day session on Sunday, with a number of major pieces - oil taxes, budgets, an in-state gas line bill - still in play.
P.P.S. Double Hitter: at 1:30 today ADT, the Senate Finance Committee will take testimony on the Alaska Gasline Development Corporation bill and the House Finance Committee will take testimony on the Oil and Gas Production tax reform bill.
April 8, 2008--BP and ConocoPhillips today announced they have combined resources to start Denali - The Alaska Gas Pipeline. The pipeline will move approximately four billion cubic feet of natural gas per day to markets, and will be the largest private sector construction project ever built in North America. The project combines the financial strength, arctic experience and technical resources of two of the most capable and experienced companies in the world.
CBC notes that a Canadian Province is subsidizing for one of it's counties what Alaska is planning to do for Fairbanks -dh. The Nova Scotia government has announced plans to spend several million dollars to help bring natural gas to businesses and homes in Pictou County.
Reader Steve Borell brings us this link from Algemeiner. It provides another dimension to the competition U.S. and Canadian natural gas producers experience: attractive and friendly investment climates abroad. -dh
Fairbanks News Miner. The Senate on Thursday approved a five-year deal to sell royalty oil to Flint Hills Resources’ North Pole Refinery.
Today's Energy Links, Courtesy: Consumer Energy Alliance:
Here are some new video and audio messages dealing with the investment climate issue; they are posted on the Alaska Support Industry Alliance webpage.
Fairbanks News Miner by Matt Buxton. With legislation backing the Fairbanks natural gas trucking project near the finish line, some lawmakers are asking about the alternatives. The question came from Rep. Lindsey Holmes (NGP Photo) during a Thursday morning House Finance Committee meeting on legislation that would put $355 million of low-interest loans, bonds, grants and tax credits behind a project to bring North Slope liquefied natural gas and propane to Fairbanks starting in 2015. “Is this going to provide more affordable gas to the Interior than an alternative of importing LNG and either trucking or railing it up to the Interior?” Holmes asked. “If the goal is to get affordable energy to an area that is really distressed, is this a more affordable option than the alternative?”
Legislation: Last night the Senate Resources Committee voted to pass HB 4, the Alaska intrastate gas pipeline legislation while; today, the House Finance Committee takes up the production tax reform bill, SB 21.
Today's Consumer Energy Alliance links:
|Today we heard this tax reform 'thank you' commercial on a local radio station, sponsored by the Alaska Support Industry Alliance -- illustrating the many dimensions the controversy covers. The point about sustainable policy benefiting many generations -- not just this one -- is a cultural value we have stressed for years and we thank the Alliance for its message. -dh|
Status of Alaska In-State Gas Pipeline:
|Alaska Dispatch Op-Ed by Representative Les Gara (NGP Photo). No one who knows natural gas pipelines disagrees with this point: a line that delivers a vastly higher volume of gas does it more efficiently, for less cost. Alaska is in the middle of a shell game with a lot of potential, but not perfect, pipeline prospects. Some people say “just pick something.” Here’s why that’s not so easy, and picking the wrong project can harm the state with high natural gas prices.|
Status of Alaska Oil Tax Reform: (Here is the status of Alaska production compared with other states, including Texas and North Dakota.)
- Today's House Resources hearing video.
- Yesterday's House Finance Committee consideration of SB 21. Below is testimony prepared by Steve Pratt, Consumer Energy Alliance - Alaska.
- Yesterday we offered an "April Fools" update and commentary. Part of that commentary revealed that Alaska has virtually no savings -- aside from the Alaska Permanent Fund -- when one deducts outstanding liabilities. Here is a letter dated March 27 from Jay Dulany, President of the Retired Public Employees of Alaska. Among his many relevant points is this: " based on calculations of the Alaska Retirement Management Board (“ARMB”), the State’s annual appropriation to PERS/TRS will soon exceed $1 billion. Payments at this level, which will only continue to grow as the UL (i.e. unfunded liability) advances beyond its current $12 billion level, will simply not be sustainable, by neither the state nor by local government employers. A benefits crisis may not be right around the corner; an employer contributions crisis is." If Alaska is to fulfill its public employee obligations, the $12 billion liability should be paid off now while Alaska has the savings available. Otherwise, public employees can expect to have their annual income reduced by a judge someday, as retired employees in Detroit and Stockton can attest. This is because the state's fiscal house is in disorder, a fact which we believe the bond rating agencies will soon discover. We also believe the rating agencies have not competently assessed the gravity of Alaska's fiscal crisis for bond holders and future investors. Any decrease in Alaska's credit worthiness will result in higher rates paid on public debt, further exacerbating Alaska's pending, economic decline. We believe this challenge is a requirement for increased investment and oil tax reform. Keeping a predatory tax policy in place is a short term solution to a looming fiscal crisis. Reforming the oil production tax to create a more attractive investment climate is a long term solution. The short term model benefits this generation at the expense of the next while the long term approach can make the economy sustainable for this and future generations. -dh
- Here are results of a poll on this subject. Dittman Corp. surveyed 800 Alaskans last week (March 13-14), resulting in a 3.4-percent margin of error. All regions of the state were represented and balanced to the 2010 Census. The House traditionally commissions a poll to help inform members and the public on priority issues before the Legislature.
“Alaskans, generally, feel our economy is stable, and support many of the issues we have identified,” Alaska Speaker of the House Mike Chenault, R-Nikiski, said. “They agree with us that we need to modify our oil tax system to make us competitive, and build an in-state gasline for in-state use. Alaskans, also, want the chance to decide whether we amend our constitution to allow parents the right to choose where to send their kids to school. Dittman Research and staff have provided us with another top-shelf document we can add to our discussions over the course of the next three weeks. It’s a valuable and informative tool to help us understand where Alaskans stand on issues before the legislature.”
AK urges North Slope producers to grow LNG commitment - Gas Business Briefing - A pending bill would give the state-owned Alaska Gasline Development Corp, which is planning the project, more flexibility in doing engineering along with ...