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Northern Gas Pipelines is your public service 1-stop-shop for Alaska and Canadian Arctic energy commentary, news, history, projects and people. It is informal and rich with new information, updated daily. Here is the most timely and complete Arctic gas pipeline and northern energy archive available 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 suggest others existing before 2001.  -dh

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2-29-12 - Alaskans Talk Personally To Candidates Beginning This Morning!

29 February 2012 7:40am

Consumer Energy Alliance (CEA) has extended invitations to the Republican Presidential candidates and to President Obama to be available via teleconference to speak directly with Alaskans.  CEA announced this morning that the first candidate to accept the invitation is Newt Gingrich.  Below are directions for calling in this morning!

 

 

Please join
Consumer Energy Alliance - Alaska
for  an
Alaska Tele-Townhall
on Energy & Natural Resource Development
with GOP Presidential Candidate
Former Speaker Newt Gingrich
TODAY, Wednesday, February 29th 9am AK/1pm ET
To participate, please call-in at 855-275-6398
No RSVP is required.

 
Comment:  Today, we had the opportunity to ask Speaker Gingrich for his view as to how federal oil and gas leases, once executed, could have a more certain outcome.  He replied that he wished to have advisory groups recommend solutions to such problems.   The speaker was online for about 30 minutes and addressed a number of questions from issues ranging from mining litigation to the Healy clean coal plant to the proper role of agencies like the EPA.   We hope to have an audio recording for you in tomorrow's posting.  -dh

Juneau Empire by Pat Forgey.  If the Alaska Senate passes an oil tax reduction, as Gov. Sean Parnell has asked, it may have difficulty getting through the House of Representatives, House Democrats said Tuesday.

ADN/AP by Becky Bohrer.  Alaska Gov. Sean Parnell said the Senate's work-in-progress proposal to cut oil taxes offers "no hope" for more investment and does nothing to stop the decline in oil production.

 Comment: Senate Resources Committee members continue a hearing begun last night to accept public testimony for Senate Bill 192, relating to oil and gas production tax values today and tomorrow.  The Alaska State Chamber of Commerce has provided all the details here.  See our comment, yesterday.  We watched much of the testimony last night ranging from NGP readers with actual knowledge of the business environment to several of the usual, provential, "It's My Oil" citizens who, because they worked one time for an oil or gas related company, union or utility, believe they completely understand the economics of Alaska's current challenges.  More tonight.  Please go to your local Legislative Information office by 6 p.m. to testify.  Here's an interesting chart.  -dh
 

Greenwire: With full pipeline route in limbo, TransCanada set to build Okla.-to-Gulf link (pub: 2/27/12) **CEA is mentioned in article**
The company behind the controversial Keystone XL pipeline project announced this morning that it will break ground on the first leg of the project, a link between an oil storage hub in Oklahoma and Houston-area refineries. TransCanada Corp. said it will proceed with the southernmost stretch of the project, a pipeline that will connect the enormous crude oil storage hub of Cushing, Okla., to storage and refining centers along the Houston Ship Channel.
 
The Washington Post: A welcome move forward on Keystone XL project -THE PROPOSED KEYSTONE XL oil pipeline, which would cross the U.S.-Canada border and thus requires presidential approval, has been on hold since President Obama rejected it in January. But TransCanada, the pipeline’s would-be builder, announced Monday that it will build a segment, from Oklahoma to the Gulf of Mexico, that does not need presidential approval. The company also said it will reapply for permission to complete the rest of the line.
 
Reuters: Keystone XL: Obama’s Critics May Be Muffled By Pipeline Construction - A Canadian company's decision on Monday to proceed with part of a U.S. pipeline might end up muffling one of the Republicans' loudest arguments in this election year: that President Barack Obama has pursued failed energy policies. TransCanada Corp announced it intended to begin work on the southern leg of the $7 billion Keystone XL project, from Oklahoma to Texas, leaving for later another run at the more controversial, and complicated, northern segment.
 
The Atlantic: The Most Important Leg of Keystone XL Is Getting Built - From the perspective of the oil industry, the most important portion of the Keystone XL pipeline is about to get built. Yesterday, TransCanada Corp. announced that it would begin construction on the controversial pipeline's 435-mile southern leg, which will move crude oil from the storage hub of Cushing, Oklahoma to refineries on the Gulf Coast. Unlike the northern portion of the pipeline, the lower section won't require approval from the State Department, since it doesn't cross any international borders.
 
UPI: Keystone XL lacks wetland review - There hasn't been a study on the effects that part of the Keystone XL oil pipeline would have on southern wetland ecosystems, an advocacy group said. Canadian pipeline company TransCanada has announced an intention to build a section of its Keystone XL from Cushing, Okla., to the southern Texas coast.
 
The Street: Gas Prices? Under Obama, U.S. Is in Decline -  President Obama is worried about the effect that high gas prices will have on his re-election. It's the old problem of pain at the pump having a knock-on effect at the ballot box. If American voters are keeping close tabs on what's been going on in America, Obama won't have to worry about collateral damage from high gas prices, because his re-election possibilities will be as promising as Jimmy Carter's and for the same reason. The nation has been steadily declining on his watch.
 
CNN: What’s behind the gas price spike? - A combination of trouble with Iran, a recovering global economy, investor interest and a potential problem at refineries are all responsible for the recent spike in gasoline prices, experts say. The biggest reason gasoline prices are rising is because the cost of oil is rising -- and oil accounts for 70% of the cost of a gallon of gasoline
 
The Hill: Gas prices to cost Obama (Op-ed) - I hate to quote the Rev. Jeremiah Wright, but the chickens have come home to roost for President Obama as higher oil and gasoline prices swamp his reelection bid. Count the chickens: Obama refused, until two months ago, to impose tough sanctions on Iran, increasing the likelihood of an Israeli attack. Already, speculation that such a strike might be in the offing is driving up oil prices.
 
The Houston Chronicle: Clinton wants tough SEC oil, gas disclosure rules - Secretary of State Hillary Clinton on Tuesday called on the Securities and Exchange Commission to “go as far as possible” with rules requiring certain oil, gas and mining companies to disclose payments to host nations. The rules, which were supposed to be made final in April 2011 but are still under consideration, would require oil, gas and mining companies listed with the SEC to disclose payments to host nations where they extract resources for commercial purposes.  

 

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2-28-12 - A "Fair Share" vs. a "Fair Shake"

28 February 2012 7:39pm

 

Please take a moment to comment on Obama's National Marine Fisheries Service (NMFS) Draft Environmental Impact Statement (DEIS) on the Effects of Oil and Gas Activities in the Arctic Ocean: Deadline TODAY.

  

               A "Fair Share" vs. a "Fair Shake"
                                        by
                              Dave Harbour

 

Senate Resources Committee members announced today that they will be accepting public testimony for Senate Bill 192, relating to oil and gas production tax values today and tomorrow.

In the story linked below, legislators demonstrate why Alaska has become such a hostile climate for investment.  On the one hand, they will be the first to talk about "fairness" and extracting a "fair share" from industry.  Yet, in 2007 the Legislature took a month to create and pass the tax bill that has depressed production and threatened Alaska's economic future.  The bill was passed with retroactive effect which any historian would likely view as "unfair" if not vulturous.  At no time in the debate do we recall legislators considering what they should "give" to the taxpayers in return for what new wealth they were "taking".  Also, that 2007 ACES bill massively rejected the "fair share" equilibrium reached by republican and democrat leaders thirty years ago and whose predictability and certainty resulted in double the Prudhoe Bay development and production than was expected when the pipeline was built.  In the article below, having extracted so much, they now propose to install a socialistic control over private companies by dictating to them how they should spend any tax  savings which tax reform might create.  Yes, we hear their populist cries for a "fair share" almost daily, but never are they seen to give Alaska's most important investors a "fair shake".

ADN by Becky Bohrer.  But Democratic Sens. Bill Wielechowski (l) and Hollis French (r) say dealing with progressivity alone isn't the answer to getting more oil in the trans-Alaska pipeline, an issue important to the state's economy.  Wielechowski and French say that if Alaska gives something to the oil industry, such as a tax cut, the state should get something in return.

 Empire editorial: Alaska must take control of Bristol Bay development - Juneau Empire - We think the state of Alaska’s elected representatives should have a strong say in any development that could affect the world’s best fishing grounds. That’s why we support Senate Bill 152, which gives the people we elect final say over whether a large mine – any large mine – situated only in that specific area will be safe enough to be allowed to receive permits. (Comment: The editorial writers believe they have the best chance stopping the Pebble Mine via legislative obstruction. This also means that they no longer trust the permitting and approval process (i.e. the rule of law) that has worked so well for this state for decades. The problem with short-circuiting the process for this single project is that this technique will be applied to every single future resource extraction project that comes to the attention of the environmental community. Either our regulatory process works or it does not. We believe it does work and works well. This proposal ought to be rejected outright. – AG)

 Has time finally come for a power grid in rural Alaska? - The Arctic Sounder, Carey Restino - A recent study by Commonwealth North, however, brings the issue into focus. Nearly 80 percent of rural communities in Alaska depend on diesel fuel, and some in those communities spend up to 47 percent of their income on energy — heating fuel, electricity and fuel for their vehicles. The report stated that many rural Alaska families struggle to both heat their homes and feed themselves.
 $2.50 per Gallon Gasoline, Energy Independence and JobsAn Address by Newt Gingrich - Newt2011 - In one short decade, we went from seven years supply to over a hundred years supply because science and technology had improved so much. Furthermore, instead of us importing liquefied natural gas from the Middle East, there is now serious talk that we’re going to build facilities in Houston, and we’re going to ship liquefied natural gas to China.
 U.S., China threaten Australia’s gas hopes - Wall Street Journal Market Watch, Virginia Harrison - The world’s two largest economies are sitting on massive shale reserves. The push by North America and China to become gas exporters — or in the case of China, a domestic supplier — could upset Australia’s longer- term gas ambitions.
 
Natural gas analytics firm expects prices to dip below $2/mcf by fall - mywesttexas.comPaul Wiseman - A natural gas storage glut, expected to peak by September or October of this year, could send prices tumbling below $2 per mcf unless there is an unexpected blast of arctic air in the northeast. This warning comes from BENTEK Energy, an Evergreen, Colorado-based energy market analytics firm.
 
 

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2-27-12 Comment Deadlines Today - Gimarc On Senate Oil Tax Policy

27 February 2012 7:36am

 Alaska Stand Alone Gas Pipeline Draft Environmental Impact Statement - Open House, Presentation and Public Hearing TONIGHT in Anchorage

 
 
Please take a moment to comment on Obama's National Marine Fisheries Service (NMFS) Draft Environmental Impact Statement (DEIS) on the Effects of Oil and Gas Activities in the Arctic Ocean: Deadline TOMORROW.

Calgary Herald  — Enbridge Inc, Canada’s No. 2 pipeline company, said on Monday that Chief Executive Pat Daniel will retire later this year and named Al Monaco, who heads the company’s gas pipeline business, as his successor.

 ADN by Lisa Demer.  The big fight in the Alaska Legislature this year over oil taxes is beginning to play out in the Senate Resources Committee and it may be epic.

 
JUNEAU- To clarify our objectives, the Senate Bipartisan Working Group has developed the following statement as members begin discussions on how to amend Senate Bill 192 in the Senate Resources Committee:
 
We Want
  • Increased Oil Production
  • More Jobs for Alaskans
  • Sustainable State Revenue Over the Long Term

We Believe

  • Alaska's oil profits must be shared fairly between industry and the State across a wide range of oil prices, geologies, and viscosities
  • Any significant reduction to Alaska's current share of oil profits must directly induce commercial investment, increase oil production, and create a competitive investment environment
  • Industry and the State must work in partnership to recruit, train, and hire more Alaska residents
  • Factual evidence and analysis must guide our debate

Alex Gimarc, ACES, Alaska Oil taxes, Senate MajorityDo Alaskans Really Believe What the Alaska Senate Believes?

Commentary by Alex Gimarc

 

While we cannot argue with what the Senate Bipartisan Majority wants, we strongly disagree with the underlying list of beliefs (See above). 
 
For example, the demand that oil profits must be “shared fairly between industry and the State…” is the height of socialism.  Profits DO NOT belong to the State of Alaska.  The producers pay various taxes, fees and royalties to the State in return for the right to produce oil and natural gas.  While royalties are negotiated via the terms of producing the leases, taxes and fees are left to the discretion of the State of Alaska exclusively. 
 
When the State excessively increases taxes, the marketplace kicks in and the producers will take their exploration and new production elsewhere.  This is precisely what they have done in response to the passage of Alaska Clear and Equitable Share (ACES) by the Alaska Legislature and the Palin administration.  
 
Additionally, the requirement that any “significant reduction in Alaska’s current share of oil profits must directly induce commercial investment…” is top-down, government directed economic planning at its worst.  It puts the Senate Bipartisan Majority into the Board Rooms of the producers making decisions, which is not what Members were elected to do.  Economic planning by politicians supplanting decisions made due to marketplace needs is the quickest way to drive any business into bankruptcy.  
 
Finally, the Senate Bipartisan Majority demands that “Industry and the State must work in partnership to recruit, train and hire more Alaska residents.”  This demand essentially turns employment on the Slope into yet another welfare program.  Why not let the marketplace operate?  Why not allow the best and the brightest to land the jobs?  Does the Majority really intend to have any less than the most highly qualified applicants working in one of the most environmentally sensitive areas in the state?  Really?
 

With these strongly held beliefs by the Senate Bipartisan Majority, we do not have much hope that there will be any rational or reasonable progress made toward modifying ACES by the Senate, as Members are bound by beliefs that are fundamentally at odds with marketplace economics that have historically worked.  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Readers be the judge: 

ADN by Lisa Demer.  Some senators say if the Legislature rolls back the tax rate when oil prices are high, as oil companies and Gov. Sean Parnell want, it also should ensure the state gets a guaranteed minimal level of oil tax revenue when prices are low.

 

The Hill (2/25/12) reports: Sen. Chuck Schumer (D-N.Y.) wants Secretary of State Hillary Rodham Clinton to press Saudi Arabia, OPEC’s dominant oil producer, to boost output as rising prices are hitting consumers at the gasoline pump…A letter to Clinton on Sunday from Schumer, a top political strategist for Senate Democrats, comes as Democrats are trying to blunt constant GOP attacks over soaring gasoline prices.
 
The Weekly Standard (2/26/12) reports: Gleick looks set to be spending a good chunk of his MacArthur genius prize winnings on lawyers; he’s retained the same criminal attorney that Andrew Fastow of Enron used for his defense against fraud charges. And Gleick has hired Clinton/Gore crisis manager Chris Lehane. Heartland, for its part, has set up a legal defense fund to pursue a civil case against Gleick, presenting the ultimate irony: -Gleick’s attack may well help Heartland raise more money…More than a few observers have asked why anyone should trust Gleick’s scientific judgment if his judgment about how to deal with climate skeptics is so bad. -Gleick’s defense of his motives would be laughable if it weren’t so pathetic: “My judgment was blinded by my frustration with the ongoing efforts​—​often anonymous, well-funded, and coordinated​—​to attack climate science and scientists and prevent this debate, and by the lack of transparency of the organizations involved.”

 

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2-26-12 Brennan on Keystone

26 February 2012 6:52am

 Anchorage Daily Planet by Tom Brennan (NGP Photo).  Tom Brennan, ARCO, Anchorage Daily Planet, Anchorage Times, Keystone Pipeline Op-Ed, Obama, Photo by Dave HarbourPresident 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.

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2-25-12

25 February 2012 9:25am

Senators Thomas and Paskvan propose gas line: Cook Inlet to Fairbanks - Alaska Dispatch - According to a legislative press release, Senators Joe Thomas and Joe Paskvan have introduced legislation that would instruct the Alaska Gasline Development Corporation (AGDC) to build a natural gas pipeline from Cook Inlet to Fairbanks, with enough capacity to serve unnamed other communities along the route.
 
Keystone pipeline would create Bay Area jobs - San Francisco Chronicle, Joe Epstein - The $7 billion project would not only make the United States more energy independent, it would also generate an estimated 6,500 jobs across the country, including hundreds in the Bay Area.
 
‘Small victory’ over ‘dirty oil’ - Financial Post, Claudia Cataneo - After enduring years of bashing in the United States and Europe over the development of its vast oil sands, Canada scored a come-from-behind victory Thursday when a committee of experts at the European Union failed to reach agreement on a policy that would have stigmatized Canada’s oil as dirtier than conventional crude.
 
Obama's sour spot on energyWashington Examiner, Michael Barone - Let’s get this straight. We’ve prohibited a pipeline, the safest way to transport oil, from Canada, but we’re aiding Mexico in offshore drilling, which is riskier, and by a firm that lacks the experience of the U.S. firms we have been trying to prevent drilling in the same body of water. Does this make any sense at all. “Obama has managed to find the sour spot on energy,” writes the usually judicious Walter Russell Mead, who concludes his blogpost with tart understatement: “his energy policy could use a bit more thinking through.” Ya think?
 
USGS releases first ANS shale oil, gas resource estimates - Oil & Gas Journal, Nick Snow - The US Geological Survey estimated that Alaska’s North Slope contains up to 2 billion bbl of crude oil and 80 tcf of natural gas, which are technically recoverable from tight shale formations using currently available technology and industry practices.

2-24-12. "Never Give In", We Say As The Week Ends!

24 February 2012 7:26am

 

Feds must act on pipelinePrentice - Vancouver Sun - ... pipeline is to go ahead as planned, former cabinet minister Jim Prentice ... Enbridge's Northern Gateway pipeline and other oil and gas corridors to the ...


Comment:  Yesterday Commonwealth North (CWN) released its newest report, "Energy for a Sustainable Alaska: The Rural Conundrum."   Ethan Schutt, CIRI, Meera Kohler, AVEC, CWN, Commonwealth North, Rural Energy, Alaska, Alaska Native, Regional CorporationThe study was chaired by Meera Kohler and Ethan Schutt (NGP Photo.  Other event photos below.) and describes a number of energy production, distribution, fuel transportation, and consumption challenges facing rural Alaska. 

Kohler noted that rural residential power generation is currently subsidized via a 'power cost equalization' program designed to align rural residential with urban residential power costs.  With the cost of diesel (i.e. the source of most rural, electric power generation) so high this CWN report seeks to identify solutions that will make residential and commercial power cost in rural Alaska more 'affordable'.  Solutions generally involve new infrastructure, new technology and new financing that minimizes impact on rural residents.  

While the costly solutions involve little ratepayer support for infrastructure and projects, aid will be expected from various levels of government and perhaps the private sector, including Alaska Native Regional Corporations, as co-chairman Schutt noted in response to a question.  We suspect that this issue will evolve into a major 'funding' issue with the Alaska State Legislature even as the community of Fairbanks seeks 'funding' for a natural gas distribution and pipeline transmission system as its own response to high diesel prices.

We conclude that Alaskans would do well to keep their economic and political eyes on the ball: reversing the declining Trans-Alaska Pipeline System (TAPS)  throughput.  If the decline is not reversed and the pipeline shuts down the massive exodus of Alaska's citizens will make other issues seem rather academic, in retrospect.  

If readers agree that TAPS is where Alaska's priority attention belongs these days, then one might conclude that: 1) Alaska should immediately improve the investment climate in a way that attracts more production on state lands; and, 2) Alaskans should never, never give up in their opposition to Obama Administration efforts to stop Alaska resource development on federal and state lands (See stories below); and, 3) we should reduce -- not increase -- public spending until TAPS throughput guarantees the state's long term economy is sustainable.

-dh

 
 
Dear Readers:
 
We ask you to recognize that the Enviro-Obama strategy  to shut down Alaska's natural resource industry is overt and we ask readers to Never Give In.  
 
The National Administration uses passive-aggressive techniques and legal technicalities to shut down natural resource development.  Please do not regard the roadblocks erected by this Administration to be simple exercises of administrative law by even handed regulators.  This webpage -- including today's news links -- is replete with proof of our charge that this Administration has perverted the rule of law to its own special interest ends.  
 
Nevertheless we must play the game and take every opportunity to comment during regulatory comment periods such as the two noted above.  If normal citizens do not comment, the weight of comment will fall in favor of the well organized, extreme environmental groups working in concert with this Administration.  Our silence will make a harmful regulatory decision for Obama's minions easy: "Most of the comment we received argued against further exploration of ...."  On the other hand, even if we do comment, biased regulators can hand pick comment to prove or disprove a given thesis.  So, regulatory law in the hands of an agenda-driven regulator endangers the rule of law, and, in turn, our way of life.  But if we give up, yield to force and do not comment, we have no hope whatsoever.  
 
Please do comment and enjoy a nice weekend knowing you did all you could to preserve the state and nation for the younger generation depending on us.
 
Sincerely,
Dave Harbour

Alaska Dispatch by Alex DeMarban.  The Noble Discoverer ship, contracted by Shell to drill up to three exploratory wells this summer, was leaving Auckland, New Zealand, bound for Chukchi Sea waters off Alaska, according to the release.  "I'm blocking Shell's Arctic drill ship because I believe passionately that renewable energy is the way of the future," Lucy said from the ship, according to the release.  Shell spokeswoman Kelly op de Weegh said the company respects freedom of speech, but isn't pleased with Greenpeace's tactics. The company is in contact with local authorities to keep the ship on path toward Alaska, she said.  (Comment: Enviro Extremists show their colors time and time again: disrupt the rule of law; interfere with the permitting process; stop civilization in its tracks; create newsworthy diversions that support fundraising activity.    Governments bend over backwards to support illegal 'occupiers' as if they were simply exercising the right to speak freely; when are elected officials going to wake up and provide LAW ABIDERS with equal protection under the law?   Meanwhile, other enviro-allies fight the legal battle to stop Alaska OCS in its tracks.  -dh)

Los Angeles Times/ADN by Kim Murphy.   Responding to urgings from U.S. environmentalists, Ohio-based Chiquita Brands International Inc. announced in November that it would join a growing number of companies trying to avoid fuel derived from Canada's tar sands, whose production is blamed for accelerating climate change and leveling boreal forests.  Then in January, President Barack Obama abruptly vetoed a permit for the Keystone XL pipeline, Canada's $7 billion project to deliver oil across the U.S. Midwest to the Texas Gulf Coast, which environmentalists have long opposed.

Alaska Dispatch by Mia Bennett.  Last week, the United States House passed the Protecting Investment in Oil Shale, the Next Generation of Environmental, Energy and Resource Security (PIONEERS) Act, H.R. 3408, with a vote of 237-187. Though oil shale drilling is ostensibly the main topic of the bill, with its passage, the House has also approved drilling in the Alaska National Wildlife Refuge (ANWR)'s coastal plain, Lease Sale 214, and Keystone XL.

Obama goes on offensive as gas prices soar - Calgary Herald - White House hopefuls Mitt Romney, Rick Santorum and Newt Gingrich point to Obama's opposition to both offshore drilling and the construction of a pipeline from Alberta, and oil company tax breaks, as contributing to higher gas prices.

Major push needed to get oil to Pacific markets: Prentice - Globe and Mail - Much of the debate over the Northern Gateway pipeline, the $6.6-billion ... Board of Trade Thursday,Jim Prentice, the former Conservative Cabinet minister, ...

1-24-12 Commonwealth North Event Photos:

Cindy Roberts, Cracking the Code, Alaska Gas Pipeline, Commonwealth North, Mrs. America, Photo by Dave HarbourCindy Roberts

Cracking the Code

 

Malcolm Roberts

Institute of the North

 

Deborah Brollini, Alaska oil and gas taxes, AGIA, ACES, Photo by Dave HarbourDeborah Brollini

Alaska Dudes and 

Divas

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