Do Enough of Us Care In The OCS Battle of Wills?

 
Comment by
Dave Harbour, Publisher,
www.northerngaspipelines.com
 

The good news is that about a half-million Alaskans and Lower 48 citizens have commented on three Administration initiatives that could strengthen or cripple America's economy and decisively affect Alaska's future.  The overwhelming majority of those commenting on the Department of Interior's Minerals Management Service (MMS) request for comment on a proposed 2010-2015 lease sale program commented in favor of developing America's Outer Continental Shelf (OCS) energy potential.  

Then a White House Ocean Policy Task Force visited Anchorage for a hearing and conducted a comment period ending Saturday, which seems to have attracted quite a number of anti-domestic energy commenters.  Next Tuesday (tomorrow), will end a comment period provided by the EPA for input on its plan to issue (after much delay) a Clean Air Act air quality permit to Shell for its Chukchi Sea project.  Please comment if you have not done so.    (Rep. Charisse Millett {l} and Mary Shields {lower left} testifying on 9-25-09)

 
With no bright prospects for ANWR, no big new oil discovery, or gas pipeline income in the next decade (at least) Alaskans should soberly realize that their State's 90% dependence on oil revenue is threatened by a 4-6% annual decline in Trans Alaska Pipeline throughput…even as beneficiaries of state entitlement programs, municipal revenue sharing, and education are demanding more. 
 
Therefore, the one straw for which Alaskans can grasp, is the medium-term hope of OCS exploration and production.  Senators Mark Begich and Lisa Murkowski with help from such friends as Louisiana Senator Mary Landrieu, are attempting to obtain for Alaska a Federal authorization for a 37.5% share of revenues from 'rents, royalties, and bonuses' resulting from OCS activity adjacent to Alaska.
 
But if anti-domestic energy activists, to whom the Obama administration is indebted, succeed in imposing a restrictive new 'ocean policy' or can deny air quality permits to Shell for activating exploration on its Chukchi Sea leases, it doesn't really matter what kind of lease sale program MMS eventually approves or what kind of OCS revenue sharing provision Congress enacts.  100% of nothing is still nothing.  In short, there are a number of ways the Obama White House and its supporters can bring wealth-producing domestic energy production to its knees, and I have only alluded to several of them here.
 
What Americans in general probably do not know is that bringing domestic energy exploration and production to its knees results in more dependence on foreign oil produced with less environmental care, more foreign job outsourcing, more transfer of wealth abroad, more debt at home, a compromised national security and the realization of a new, multi-trillion dollar anti-stimulus program.
 
For those more selfishly concerned about Alaska's survival, an end to OCS jobs and revenue sharing hopes could result in Alaska's evolution into a late-1980s depression at best or, more probably, a pre-pipeline population and economy by the next decade.
 
But Alaska has state-owned oil and gas potential, doesn't it?  Yes, but existing reserves are incapable of sustaining our huge government structure and entitlement culture.  From now on, the State will be spending its reserves, like a young man without sufficient employment spending his retirement accounts and paying huge penalties to do so.
 
One could mate the threatening OCS news with the realization that Alaska is becoming uncompetitive with other oil producing provinces.  Why?  
  • Because we are among the most expensive producing regions of the world (the Arctic), to begin with.
  • Because we are among the highest taxing governments of the world (Alaska + U.S.)
  • Because many/most of our competitors have oil and gas products available at tidewater locations and our companies have to pay the additional penalty of 800 miles of pipeline to transport our oil to tidewater.  (Gas shale could make our gas uncompetitive in the Lower 48 and an 800 mile gas pipe will make it less competitive with tidewater LNG sellers.)
  • Because many/most of our competitors find and produce their oil/gas in low cost temperate zones.
  • Because many/most of our competitors have lower environmental/regulatory costs.
  • Because many/most of our competitors have lower labor costs.
So, OCS is important.  Our Governor, every Legislator and all three Members of our Congressional Delegation have been aware of this week’s deadlines for commenting on an 'Oceans Policy' and on 'Chukchi Clean Air' Permits and we are confident many of them did provide written comments.  Our Northern Gas Pipeline articles have covered Governor Sarah Palin, Governor Sean Parnell, State Representative Millett, State Senator Lesil McGuire, and U.S. Senators Begich and Murkowski as they spoke to the various tribunals and/or provided earlier comment.   
 
One could still comment on the Oceans Policy, albeit two days late, and one could still timely comment on the Chukchi permit.
 
One wonders how many Alaskans, in all, commented.  One wonders who among our elected leaders commented.
 
One wonders, "Do enough of us care enough in this battle of wills?"