Globe & Mail by Eric Reguly. Oil prices fell as much as 2 per cent on Monday (Today), after Iran reached a deal with six world powers.... Petroleum News. Troubled times in Canada - 11/24/2013 Obstacles piling up in front of Canada's petroleum industry and its government allies are accumulating so rapidly that hopes of exporting ...
ADN Commentary by Paul Jenkins re: Repeal of Oil Tax Reform:
"Two former Democratic governors, Tony Knowles (NGP Photo-r) and Bill Sheffield (NGP Photo-l), have expressed opposition to any repeal. Just about everybody running for important state offices -- from governor on down -- is on record for or against the repeal." (NOTE: We urge readers who haven't already, to review the Competitiveness Review Board presentation given friday to Commonwealth North. Our tax commentary for many years is founded on the principle that Alaska must be competitive to survive, economically. This technique is one effective way of calculating competitive positioning as a factual basis for tax and regulatory decision making. We believe that while SB 21 is a step in the right direction to become less uncompetitive, Alaska will have to do more to attract the tens of billions of dollars needed to reverse the downward economic trend. The new 'Board' has the economic future of Alaska resting on its forthcoming decisions and recommendations. -dh)
|Another News Miner Community Perspective on Mining, by Kyong Hollen.
The first bar of gold was poured in 2006 and production has been steady ever since.
This has meant not only benefits to the company, but jobs for Alaskans, business for suppliers, added revenue to the state and philanthropic scores for Delta Junction, Fairbanks and the University of Alaska Fairbanks. In fact, Pogo recently pledged $1 million to UAF for a mining engineering endowment that will allow graduate students to work on long-term projects.
Fairbanks News Miner, Alliance Leader, Rebecca Logan (NGP Photo), Speaks Out On Mining Benefits. "Anglo American’s recent departure from the Pebble Mine project has generated contentious debate throughout the state and in our nation’s capital about the future of domestic mining. ... It’s a hard pill to swallow considering that our nation’s $6.2 trillion worth of mineral resources could be developed responsibly, generate economic growth, support new high-paying jobs and strengthen domestic industries. ... just look at the more than 9,500 Alaskan jobs the mining industry supported last year alone. These jobs are among the highest paying in the state with an estimated average annual salary of $100,000 — more than twice the state average. Mining not only creates jobs at mine sites, but also supports local businesses, generating employment at grocery and supply stores, auto dealerships and hotels. ... Mining supported nearly 2.2 million American jobs and contributed $232 billion to the nation’s GDP in 2011 alone. The very minerals mined here in Alaska and throughout the United States are essential elements to nearly every domestic manufacturing chain, from the automotive sector to defense and renewable energy. Minerals supply our industries with the raw materials they need to continue churning out innovative American products. More here....
In terms of energy, the challenges facing Interior Alaska are numerous. Many companies and individuals are working to identify these complex issues and try to determine feasible solutions for Fairbanks and beyond. The solutions to these problems won’t come easy, but they are necessary for Alaska’s 2ndlargest city. Fairbanks sees extreme cold during the winter and that cold comes with an extreme price tag for homeowners. Monthly expenses for heating can be upwards of $1200 during the coldest months of the year. Electric bills are also higher in the winter because power generation is mostly oil-fired.
One group that is working to find a solution to the problem is the Alaska Industrial Development and Export Authority (AIDEA). This summer, AIDEA’s board of directors approved $7 million for the purchase of long lead-time equipment for a North Slope natural gas liquefaction plant to serve and LNG trucking operation to Fairbanks. The state legislature approved state financing of $275 million for this project during the 2013 legislative session. Governor Parnell would like to see the “Interior Energy Project” ready by the end of 2015. AIDEA has received proposals from three organizations looking to work on the LNG plan; Golden Valley Electric Association (GVEA) and two private firms, Fairbanks Natural Gas LLC and Spectrum LNG. Each organization could potentially partner with AIDEA to assist in brining affordable heating solutions to interior Alaska.
A plant in full operation would allow about 50 trucks of LNG to be brought to Fairbanks on a daily basis. Some have expressed concern regarding the increased traffic along the Dalton Highway. However, it is estimated that because of the seasonal nature of energy demand, the plant would operate at 60% or less for part of the year. The summer months would have much less traffic than the high demand winter months.
AIDEA states that the assumed 9 billion cubic feet per year of gas converted to LNG will be used for space heating and not for power generation by Golden Valley Electric or by Flint Hills Resources. Given that GVEA has submitted a proposal to work with AIDEA, it is likely that they will also become a customer of the project. The plant at Prudhoe Bay can be expanded to accommodate the additional demand for LNG.
AIDEA conducted a feasibility study of trucking LNG to Fairbanks to help ease the cost of heating. The study shows that the use of LNG could reduce the average homeowner’s heating cost by half of what they are currently paying for heating oil. This would result in an average annual savings of $2,500-$3,000 per household.
Another factor that is driving this project is the need for cleaner fuel in Fairbanks. The use of wood heat is high in Fairbanks due to the high prices of heating oil, but the smoke from wood burning stoves creates a lot of air pollution. The ability to use LNG would help reduce the air pollution in Fairbanks by reducing residents’ dependence on wood heat and burning heating oil.
There is concern about relying on trucking LNG to Fairbanks because the Dalton Highway is often difficult to traverse in the winter months. The Alaska Energy Authority has explored many emergency supply options for this problem. This includes having storage capacity in Fairbanks to hold a 10 to 14 day supply of LNG in case of road closures, as well as making an arrangement with ConocoPhillips to supply LNG from its plant on the Kenai Peninsula.
Many believe that LNG is the way to address the challenges facing the interior, specifically Fairbanks. The state legislature, AIDEA, Fairbanks utilities, and private industry believe that they can help with the cost of energy, provide a cleaner fuel option, and provide a reliable heating source for Fairbanks. The solutions aren’t easy, but groups are willing to work to find a solution that is viable for Interior Alaska to address the issues brought on by the energy crisis that Fairbanks is currently facing.
ADN by Lisa Demer. ... Black & Veatch just completed a $424,000 study for the Parnell administration on the economics of a gas project that suggests significant state investment of $9 billion to $13.5 billion could make the project happen....
House Supports States Rights; National Ocean Policy Council Urges Fund Cutoff for White House Overreach; Commonwealth North Reviews Oil Tax Competitiveness
Today, Senator Lesil McGuire (NGP Photo) discussed the Competitiveness Review Board component of SB21, the oil tax reform bill passed in the last legislative session.
Commonwealth North's (CWN) Aaron Weddle sent a notice stating that McGuire championed this piece of the bill. He said that during her presentation to a CWN committee today, she will describe the need for the board, what the board’s role and composition will be, and how similar boards have been effective in other governments.
According to the CWN notice, the Competitiveness Review Board is designed to study and evaluate the state’s tax policy in the context of a global marketplace and make recommendations to the Legislature.
Over 70 commercial and recreational groups today submitted a letter to the 36 members of the Joint Conference Committee that were recently appointed by the U.S. House and U.S. Senate to reconcile differences between the two chambers’ versions of water resources infrastructure legislation. The letter supports maintaining language in the House bill that would prohibit any programs and actions authorized under the legislation from being used to further implementation of the Coastal and Marine Spatial Planning and Ecosystem-Based Management components of the National Ocean Policy Executive Order.
Comment: One of the Interstate Oil and Gas Compact Commission (IOGCC) positions over the years is to protect states' rights to regulate their own production activities. When it comes to the long and safely state regulated hydraulic fracturing technologies, the individual IOGCC members have assured the protection of the public interest. This week, we have from Chairman Doc Hastings' (NGP Photo) House Committee on Natural Resources this report: "On Wednesday, the House of Representatives approved H.R. 2728, the Protecting States' Rights to Promote American Energy Security Act. This bipartisan bill, sponsored by Rep. Bill Flores (R-TX) and Rep. Henry Cuellar (D-TX), would protect American jobs and American energy production by limiting the Obama Administration's ability to impose duplicative regulations on hydraulic fracturing on federal lands." We continue to support the IOGCC's longstanding defense of states' rights against the aggressive overreach of the federal bureaucracy; further, we comment IOGCC member agencies for effective regulation of energy production within their individual borders. -dh
ADN by Sean Cockerham. Last year the hacker group Anonymous broke into computer systems of oil companies including Shell, Exxon Mobil and BP as a protest against Arctic drilling. The next month , a different set of hackers infected the computers of Saudi Arabia’s national oil company with a damaging virus that knocked 30,000 workstations offline.
The Calgary Sun (11/16/13) reports: “The protest was held as world leaders in Poland for the United Nations Climate Change Conference discuss plans for international co-operation on the issue. Protestors in Calgary said the Harper government is refusing to take meaningful action when it comes to climate change. Originally about 300 people were slated to participate in the Calgary protest, but due to a snow storm only about 50 showed up.”
News Miner. An Alaska official said Monday the state is looking at taking a multibillion-dollar equity stake in a major natural gas pipeline project as a way to protect its interests and help make the long-hoped-for project a reality. Natural Resources Commissioner Joe Balash said Gov. Sean Parnell's administration views a potential equity stake of 20 percent to 30 percent favorably. But he said any level of participation would depend on legislative buy-in and the terms the companies pursuing the project are willing to accept.