(Notice: two readers told me they encountered a 'virus warnining' when activating the link above. I checked the link several times and ran my virus program check on the URL. It received a clean bill of health. If anyone has information to the contrary, please advise. -dh)
(Comment: We do not believe readers should view this analysis as negative. It correctly characterizes the large volume of gas on the slope, potential markets and some of the cost advantages it enjoys amid the disadvantages of remoteness, logistics, etc. What the article should do is motivate Alaska decision makers to rapidly move to make the State's tax climate more competitive so that investors can be more confident that big money invested in the state is likely to produce an acceptable return and unlikely to be expropriated via future tax legislation. -dh)
TODAY'S American Energy Alliance Energy Links:
Doubling down on the automobile mandate does make sense, if you are in favor of more deaths on the highway, a $3000 increase in the average price of a car, pricing millions out of the new car market, and limiting consumer choice. White House (10/8/12) reports: “On energy, I’m big on oil and gas, and developing clean coal technology, but I also believe that if we’re ever going to have control of our energy future, then we’ve got to invest in solar and wind and biofuels, and that it does make sense for us to double our fuel-efficiency standards on cars. And that's not a socialist plot -- (laughter) -- for us to reduce our energy usage. It’s the smart thing to do. It’s right for our national energy. It’s right for our economy. It’s right for the environment.”
“Temporary” right? The subsidies have been in place for 20 years. People have been using wind to generate electricity for more than 100 years. And if this stuff is really cost competitive, why are we subsidizing it? WSJ (10/8/12) reports: “At a time of intense debate over the federal
ADN Editorial: ... That's what was most frustrating about the state Senate refusing to even hold hearings on House Bill 9, which would have empowered the Alaska Gasline Development Corp. to pursue an in-state "bullet" line with a target of a 2013 open season and given AGDC a seat at the table for discussions on the LNG export project where it could leverage its work and the 417 miles of right of way it possesses. If Alaska's state senators have an alternative way to get gas to state residents and relieve crippling energy costs, they have yet to present it. They appear content to place the destiny of the state in the hands of others, namely the North Slope producers some legislators so enjoy vilifying. ...
Thoughts on Alaska Oil and Gas, by Brad Keithley. In March, the University of Alaska Anchorage’s highly respected Institute of Social and Economic Research (“ISER”) published a paper entitled “Managing Alaska’s Petroleum Nest Egg for Maximum Sustainable Yield” (.pdf). The paper is the continuation of an effort started last year (.pdf) by ISER’s Scott Goldsmith to determine the appropriate level of annual state government spending, if the objective is generally to maintain a consistent, inflation adjusted level of state spending over time. ... "Alaska Fiscal Policy| Like fish, if the current rate of “take” (i.e., state spending) is too high – higher than can be supported by the state’s asset base on a sustained basis – the state’s “nest egg” is eroded and the revenue available for spending in future years is reduced. In short, setting the rate of state spending at higher than sustainable levels will leave future generations of Alaskans worse off than the current generation. ... Sadly, it appears that Alaska’s most recent generation of political leaders has failed to grasp this principle and is leading Alaska off the fiscal cliff."
THOUGHTFUL THURSDAYS, by Deborah Brollini. Oil and gas, and pipeline issues are complex and can be intimidating. Alaska Energy Dudes and Divas launched its "Thoughtful Thursdays" series last week to help citizens better understand the issues facing you, your family, and the State of Alaska. Sit down and relax in a fun environment and speak with experts from the oil, gas and energy sectors and have your pressing questions answered. 6/21/12 - Admiral Tom Barrett, President of Alyeska Pipeline Service Company https://www.facebook.com/
Fox News by Joshua Rhett Miller. Deep-pocketed environmental groups are collecting millions of dollars from the federal agencies they regularly sue under a little-known federal law, and the government is not even keeping track of the payouts, according to two new studies.
Under the Equal Access to Justice Act, or EAJA — which was signed into law by President Carter in 1980 to help the little guy stand up to federal agencies — litigants with modest means who successfully show government agencies wronged them can get their legal fees back from the taxpayer.
(Link contributed today by California reader, BH)
Commentary: Alaska's economy is almost completely based on oil, yet many of Alaska's leaders continue to demonize and criticize Alaska's most reliable and bountiful investors in order to build public support for keeping oil taxes among the highest in the free world. Keeping oil taxes high benefits liberal constituencies -- environmental extremists and public works labor unions -- for different reasons. It also benefits many constituencies via a vast wealth redistribution "Capital Projects Budget", which lures many private sector voters into the enticing web of the 'entitlement state'. But high taxes also make oil less competitive on the world market. As Richard Peterson's Op-Ed piece below points out, Alaska should be paying more attention to the shifting paradigms of world markets. Meanwhile, private environmental organizations are working hand in glove with the environmental activists embedded in the Obama administration to stop oil and mining activity wherever possible and delay projects. Congressman Doc Hastings' (NGP Photo) statement this morning mostly refers to anti oil federal policy, as does Virginia Governor McDonnell's Wall Street Journal Op-Ed piece last week, noting that, "Virginia is not alone in playing witness to the president's apparent disdain for domestic oil and natural gas production. The administration's perpetual slow-walk approach is especially noticeable in the Gulf of Mexico and off Alaska's coast."
|Groups like CEA are vigilant over all types of federal overreaching actions. Here, CEA urges Interior to not list the Dunes Sagebrush Lizard as 'endangered'. Texans are encountering with this possible designation the same threats to economic survival Alaskans face with federal critical habitat listings for the polar bear, steller sea lion and beluga whale, all of whose populations are actually increasing. -dh|
Honest, hardworking Alaskans and their private institutions could be forced out of Alaska's economy -- if these state and federal policies don't change. Without a vibrant private sector, Alaska could once again -- and soon -- become a ward of the Federal government and its industries vulnerable to nationalization. We believe that is precisely what some special interests want. -dh
Richard Peterson (NGP Photo)
(Commenting on Alaskanomics Reference Below)
A blog posting by David Hackett examines the reasons behind the recent high prices of North Sea Brent Crude oil relative to West Texas Intermediate Crude (WTI), noting that these two crudes historically traded at close to the same price. The huge increase in oil production from North Dakota has disrupted traditional oil transportation and supply patterns - there is no efficient way to transport oil south of Oklahoma to the refineries on the Gulf coast. ... Hackett predicts that the Canadian producers will work hard to move their oil to the West Coast, potentially displacing Alaska's crude.
For some time we have asked, “why is Alaska North Slope (ANS) crude oil selling for such a high price”. This article from Northrim Bank lays it out and while Alaskans have been basking in the $40/bbl premium soon Canadian producers will break out and reach the West Coast. We have been aware of a proposal to rail Canadian crude to Delta to ship in TAPS to Valdez. It doesn’t make economic sense unless you look at the differential. At $40/bbl even $20/bbl you can do strange things. We are aware of Bakken producers railing crude to the East and West Coasts. One just ordered 1200 new tank cars and will soon be flooding the West Coast with much cheaper oil. When Keystone is built part of the log jam will break. Another Canadian oil line will be expanded to Vancouver and the Puget Sound pipeline connecting it to Washington State refiners will also be expanded dumping hundreds of thousands of barrels per day into this market. When you realize that soon BP will be the only Washington State refiner with crude oil on the North Slope you can easily see why this will happen.
Anchorage Daily Planet by Tom Brennan (NGP Photo). President Barack Obama is pushing for serious damage to the world environment — and the greenies are cheering. When Obama moved to block the Keystone XL Pipeline project he was virtually assuring that oil from the Athabasca tar sands will be consumed in China under Chinese standards, with a devastating net impact on the atmosphere. The alternative would have been to process in Texas the heavy oil from the tar sands, distributing much of it to American markets, all done under American standards and heavily regulated by federal agencies tasked with protecting the environment.
Scroll down to review current comment periods.
NGP Reader Kaye Laughlin (NGP Photo) sends us this copy of the testimony/comment she provide the USFWS re: the ANWR wilderness threat.
Here is a position paper on the ANWR issue provided by Acting Executive Director of the Resource Development Council for Alaska,Carl Portman (NGP Photo-L).
We are aware of hundreds of other comments but have these additional examples for our readers:
Alaska legislator, Representative Bob Lynn (NGP Photo-L), gave the USFWS a comment, reading in part: "I want to see ANWR open to oil exploration and production."
Alaska legislator, Representative Charisse Millett (Photo below) has continued to be -- with Senator Cathy Giessel (Photo below) -- among Alaska's most prolific commenters on federal policy issues. As examples, for reader reference, we note comments on: Beluga Whale Critical Habitat, ANWR Conservation Plan Review, BOEM SEIS Chukchi Sea, NMRS Resolution HJR 40 re: Beluga, BOEMRE's 2012-2017 Leasing Program, EPA Air Permits-Chukchi and Beaufort Seas, BOEMRE re: OCS moratoria, BOEMRE's 2007-2012 Leasing Program.
NPG Readers: Please Comment on OCS before September 26, 2011
Comment in support of the Final Supplemental Environmental Impact Statement (SEIS) for the Chukchi Sea Oil and Gas Lease Sale 193, against further delay and 'affirming Lease Sale 193"
COMMENTS: Final SEIS, Chukchi Sea Lease Sale 193
c/o Regional Director, BOEMRE Alaska OCS Region
3801 Centerpoint Drive Ste. 500
Anchorage AK 99503-5820.
NPG Readers: Please Comment on EPA O&G Emissions Regs
Before October 24, 2011 send comments re: unnecessary natural gas emissions rules that will further slow down America's economy and employment without significant benefit. Federal Register notice with filing instructions
NPG Readers: Please Comment on ANWR. Here's how.
Testify: Fairbanks 10-19-11, Anchorage 10-20-11
Written testimony due: 11-15-11
(We are pleased to note House Joint Resolution 11 sponsored by by Charisse Millett (NGP Photo) in the House urging the Congress to not convert the 1002 area of ANWR to a status that prevents oil and gas development. NGP Readers can refer to this resolution in their own comments and rely on the information conveyed by Representative Millett's resolution. -dh)
|October 14 ends the comment period for the Wishbone Hill Coal Permit Renewal and we urge readers to file electronic comments early. Don't be technical if that's not your background; just say, "I support the Wishbone Hill Coal Permit Renewal". Here's the state webpage and here is a very good letter penned by Alaska State Senator Cathy Giessel (NGP Photo). We would be delighted to post other legislative and citizen comments on this and other comment period issues -- such as those coming up in the blocks above. Write us here. We urge citizens and public officials to take just a few minutes to influence a process that will determine what kind of economy our children will inherit. -dh