Miss a day
Miss a lot

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.

 

3-22-14 "We can't always judge a book by its cover."

22 March 2014 1:47pm

Governor's Prayer Breakfast In Anchorage This Morning 

 While the live event is sold out, NGP readers can attend the virtual event on line by going here.  The Prayer Breakfast coverage begins at 8 this morning, which is noon EDT.

We have attended and covered these events in the past.

Question.  Why would we do that?  Answer.  We make occasional reference to the omniscient, omnipresent, omnipotent creator of the Universe here because we are lost in the chaos of temporal issues without Him.  

American and Canadian energy projects, family plans, company investments, government coordination and all other human endeavors can only go well in the long run with men and women of faith who seek God's wisdom and petition Him to direct our paths.  

The alternative, with apologies to Thomas Carlyle for use of his term, can only lead one, one's family, one's project or one's nation into a life of "dismal science".   -dh


On another but somehow related subject is a video designed solely to inspire and entertain the many loyal followers of "Northern Gas Pipelines".  Sit back, hold onto your chair, take a deep breath and listen to this Italian angel whose voice seems -- but is really not -- inconsistent with her uniform:

Alaska Dispatch.  A Californian withdrew his name from an Alaska board on which membership is reserved for Alaskans, but a Texan is still seeking confirmation to another Alaska board.     ...     Seeking confirmation now to a seat on the Alaska Gasline Development Corp. is Richard Rabinow of Houston, Texas.

Categories:

3-21-14 Court Weighs In On Pebble Referendum

21 March 2014 5:34am

Piedra de Agua, Japanese Pool, Photo by Dave HarbourSome Dear Readers have inquired about our travels.  While we always devote hours keeping NGP current -- no matter where we are --- we do not deny opportunities for consulting, photography, general writing projects and a little personal enjoyment.  Last Friday, here in Cuenca, Ecuador, we went to a nearby 'volcanic spa' after updating our pipeline projects and wrote about it on Facebook last Saturday.  Here is a glimpse.  Enjoy your weekend!  -dh


Calgary Herald by Mario Toneguzzi.  A bright outlook for Alberta’s economy is being haunted by pipeline risks, says a new report released Thursday by the Conference Board of Canada.  Alberta’s economy is forecast to grow more quickly than any other province in 2014, said the report, but the lack of pipeline development continues to present a significant downside risk to the forecast.

Commentary: We have often commented here and documented the case against the U.S. federal administration's lawless behavior. 

One of the most egregious examples is the EPA attempting to stop a lawful resource development project -- on validly held Alaska state land leases -- before that project had filed even the first permit that would initiate the regulatory process, due process (i.e. rule-of-law process).  Today, we have the latest status on a related matter, wherein environmental allies are using another technique to end-run the regulatory process.  

For other updates, see latest issue: Mining North of 60.

We are pleased to note that the court system (i.e. at least, the Alaska Superior Court) seems not to be drinking the anti-rule-of-law cool-aid being imbibed by the federal administration, as reported below by the Pebble Project.  -dh


The Pebble Limited Partnership issued the following statement regarding a decision in Alaska Superior Court upholding the legal claims raised by PLP and the State of Alaska regarding the legality and constitutionality of the so-called Save Our Salmon Initiative from 2011:

“We are pleased that the court agreed with our position that this was an improper and unlawful ballot measure. It is unfortunate that these issues could not have been sorted out before the initiative was placed in front of voters as there were significant resources expended in the campaign by both sides that could have gone to more productive uses in the Borough.

“The ruling says that the Alaska Legislature granted state agencies, notably the Department of Natural Resources, the comprehensive authority over mineral exploration, permitting, and development. The decision holds up the sanctity of the State of Alaska’s robust permitting process, one that has strict environmental standards for fish, water, and wildlife. This ruling will assure that permitting decisions are made through the state’s comprehensive process, which includes ample opportunity for input from local people as well as stakeholders throughout the state. In contrast, the SOS initiative had no provisions for public input or public process.

“Alaska's mineral wealth, like its oil and gas resources, is an asset for all Alaskans. The court’s decision assures that permitting decisions will continue to include views from around the state.”

Those interested can download the 29 page court decision here. 


Go here to 'Friend' us on Facebook and/or to see this and other personal updates.

Yesterday (3-14-14) was a long but blissful day.

Thursday night I was up until almost midnight writing and editing photographs. 

A few hours later, at 4:30, my Coo-Coo-Bird Iphone alarm rousted me from near REM slumber. I exercised, showered, dressed, made a cup of Instant Starbucks (usually, while at Casa San Sebastian in Ecuador I enjoy ground up, dark oily coffee beans from Loja, south of here), and loaded two backpacks. One had a change of clothes, sandals and swim suit and the other protected my Nikon and lenses.  I made a few www.northerngaspipelines.com updates and ran out the door to a waiting taxi on Calle Simon Bolivar.

My "brother" and taxi driver friend, Luis Rivadenetra, met me down front on the sidewalk at 5:30. Our plan was to be at the gate of Piedra de Agua at precisely 6 a.m. when they opened so that I could photograph this unique volcanic, mineral water/mud spa during the sunrise, golden hour.

I'll be writing more on this and other photo assignments elsewhere; suffice to say, amid photo sessions I treated myself to mudbaths, mineral pools, steam cabinets, etc.

For a person as tired as I was, it was truly a blissful experience which I can now recommend to anyone visiting this luscious part of God's green earth!

Late in the afternoon, and 450 photo images later, Luis met me in the reception area and we had a nice trip home, down the winding avenues.

Today the writing and photo editing continue with church on the schedule for tomorrow, http://thegatheringec.com/.

Meanwhile, Nancy is repairing well from a procedure she had done on her wrist Friday in Anchorage and Billy is moving a foot of snow off the driveway. As Nancy said in an email this morning, "Extremes in both locations, nice!"

It's 7 p.m., EST here. With a great family, a long, blissful day yesterday, good work today and a gathering of praise tomorrow, one must be thankful.

P.S. Here is a Gringo Post report we wrote for those following Ecuadorian opportunities from their own perches around the world: http://gringopost.blogspot.com/2014/03/recommendation-for-andean-spa-local.html— at http://www.piedradeagua.com.ec/

Categories:

3-20-14 Learning From History

20 March 2014 8:14am

What Does This Week's Gas Pipeline Effort Have To Do With The August Primary Election?

by Dave Harbour

                               Alaska, Governor, Jay Hammond, oil taxes, Photo by Dave Harbour

Thirty-three years ago this week, Alaska's governor, Jay Hammond (NGP Photo), gathered with House and Senate leadership to announce bipartisan legislation aimed at reforming oil taxes.

Point of Personal Privilege:
 
We celebrate the life and mourn the passing of our great friend, Dr. Milton Byrd (NGP Photo).  (See our later update and obituary on March 3, 2014)
 
Milton Byrd, Frontier Companies, Tennessee Miller, Alaska Support Industry Alliance, Commonwealth North, World Affairs Council, Rotary, Photo by  Dave Harbour, Charter CollegeInterested readers may contact us personally here, for more information as the Byrd family releases it.
 
For over three decades, Milton has contributed tirelessly to the growth and improvement of Alaska and her people.
 
We first met upon his arrival.
 
Tennessee Miller, the iconic Alaskan owner of Frontier Transportation (i.e. of North Slope 'Cat Train' fame), was his first Alaska boss.
 
"I've hired this bright, young college president," he once said proudly, "to come up here and help me handle my business affairs."
 
Milton called soon thereafter and he said mine was the first business call he had made.  
 
We met for lunch at Sheffield's old "House of Lords" downtown.  This was about a week after he hit town.  
 
We became lifelong friends and he seemed more excited to come to Alaska than any newcomer I've met over the years.  
 
Following his career with Frontier, Milton organized Charter College, which he led during another career, as president (i.e. his fourth college presidency, as I recall).
 
He remained active throughout his Alaska adventure with Commonwealth North, the World Affairs Council, Rotary International and the Alaska Support Industry Alliance, among many other charitable and public interest pursuits.
 
He and his beloved wife, Sue, moved to Las Cruces, N.M. where he passed away recently.
 
Our dear friend, Dr. Milton Byrd, was a serious man with a wry sense of humor punctuated with a twinkle in the eye.  He was a man of honor, grace, wisdom and dedication.  
 
He made the world better.
 
Thank you, God, for letting this great one to have been among us.
 
A mutual friend, Ken Martinson, summed it up best: "The news about Milt's passing is in sorrow, but his Life's accomplishments and contributions are full of joy."  -dh

That action led to roughly 20 years of tax stability, massive industry investment and more production than had been earlier envisioned.  

Then, in 2006-07, the production tax was massively increased, leading to continuing declines in production and action in the last legislative session to again reform taxes.  

Tax reform did pass (SB 21) last Spring, but it was immediately attacked by minority legislators and a group of environmental activists and mostly democratic grass roots operators.  They succeeded in gathering enough signatures last summer to place on this coming August primary ballot a proposition that, if a majority vote "yes", would repeal oil tax reform.  

This week's major focus (scroll down to review stories and commentary) in Juneau has been on legislation intended to advance an Alaska North Slope gas pipeline/LNG project that would both provide intrastate gas supply and gas for export.

We can easily surmise that if a majority elect to repeal tax reform, Alaskans will see diminished oil industry investment, a faltering economy and little hope for a gas pipeline/LNG project during this generation's watch. 


Calgary Herald.  

Deputy premier Dave Hancock was chosen interim premier of Alberta during a Tory caucus meeting at the legislature Thursday morning.

“I think what we need is some stability as we go through the process of leadership selection,” Hancock said when asked what qualities an interim leader should posses. “Government obviously has to continue to do its job. Ministers have to continue to do their work. The budget needs to get passed, the rest of our session needs to be dealt with, so it’s steady as she goes through that process while potential leadership candidates are getting their campaigns together and going out.


San Francisco Chronicle/AP by Becky Bohrer.  

The Alaska Senate on Tuesday passed legislation aimed at advancing a major liquefied natural gas project, over nagging concerns about the role of TransCanada Corp.

The vote, following hours of debate, was 15-5. Republican Sen. Bert Stedman joined minority Democrats Hollis French, Bill Wielechowski, Johnny Ellis and Berta Gardner in voting against.

Natural Resources Commissioner Joe Balash had hoped for a resounding approval as a message to the other project partners and markets about Alaska's resolve in pursuing a project. Tuesday evening, Gov. Sean Parnell thanked the Senate for passing his bill and said he looked forward to working with the House to pass legislation "on Alaska's terms and in Alaskans' interests."


 

Categories:

3-19-14

19 March 2014 6:52am

CBC News.  Joe Oliver sworn in as finance minister, Greg Rickford replacing Oliver at natural resources.


Fairbanks News Miner by Matt Buxton.  After a marathon floor session that stretched well past five hours, the Senate passed Gov. Sean Parnell’s Senate Bill 138 that grants the administration sweeping power to partner with North Slope producers to move forward on the first stages of the $45 billion to $65 billion project.

Commonwealth North TODAY:

Today’s forum is on Alaska's Potential Investment in a North Slope Natural Gas Pipeline Project, Dena’ina Center, 3rd floor, room A, 11:30 a.m. in Anchorage. 

CWN Series Discussion on Alaska's Investment in a

Natural Gas Pipeline Project

Gasline Knott.jpgIn February, Commonwealth North hosted the UAA Seawolves Debate Team to debate both sides of the question, Should the State of Alaska take an ownership stake in a North Slope gas pipeline project?  The team did an excellent job of representing both sides of this important public-policy issue.  The debate was both entertaining and informative and was also the beginning of a series of forums Commonwealth North will hold to present an in-depth analysis of possible State participation in a North Slope gas pipeline project. 

Over the next several months, Commonwealth North will present three panels to discuss various aspects of this topic on March 19, April 23, and May 21.  The panels will address a number of issues Commonwealth North Members and other Alaskans are concerned about. 

The implications of State participation in a gas pipeline project.   

  • Could State participation be financially beneficial to the State?
  • Would State participation increase the likelihood of the project's success?
  • Are there options for Alaska other than an equity share that would help move the project forward?
  • What are the possible benefits to the producers of State participation?

Panelists for TODAY, March 19th:

Nikos TsafosNikos Tsafos, Founding Partner of enalytica and currently advisor to Alaska Legislature on Natural Gas Projects; former Director of Global Gas Practice for PFC Energy; former Researcher, Burke Chair in Strategy, Center for Strategic and International Studies.

Dan DickinsonDan Dickinson, Trained as a geologist at Brown University and currently holds a CPA license for Alaska. He has served in several state and municipal administrations, including as the director of tax for the State of Alaska in both the Murkowski and Knowles administrations. His consulting practice concentrates on state and local taxes (SALT) with a focus on oil and gas.

Pat GalvinPat Galvin, Vice President and Deputy General Counsel for Great Bear Petroleum Operating LLC. He is a former Commissioner of Revenue for Alaska under Governor Palin, and has a long history of working on Alaska oil and gas issues, including the pursuit of a natural gas pipeline. In addition to his law degree, Pat has an MBA in Finance and Taxation.

Larry persilyLarry Persily will moderate the panels.  Persily is the federal coordinator for Alaska natural gas pipeline projects and a former deputy commissioner at the Alaska Department of Revenue.

Additional panelists for this series will includeGregg Erickson, Tim Bradner, Steve Rieger and others.

3-18-14 Senate Adopted Gas Pipeline Legislation Tonight

18 March 2014 10:27am

KTUU.  The Alaska Senate has passed legislation aimed at advancing a major liquefied natural gas project, over nagging concerns about the role of TransCanada Corp.  The vote was 15-5. 

Categories:

3-17-14 Is Alaska Flirting...?

17 March 2014 4:53am

Is Alaska Flirting With The Last Gas Pipe Straw?

Competition Perspectives: Part IV (Part IPart IIPart III)

by 

Dave Harbour

We had written a very long commentary which tried to shed light on the effect of currently discussed issues on Alaska investment climate competitiveness.  We then delved into the effect various pending decisions could have on prospects for an economically feasible gas pipeline.

And we concluded that, as in Canada's MGM case, investors would do the best they could until the day a straw "broke the camel's back," resulting in an unhappy press conference that catches everyone off guard.

Acknowledging to ourselves today that the whole political structure of Alaska is focused on resolving gas pipeline issues, we decided to not add our voice to the suite of cacophonous debates.  After all, the symphony of special interests will sing and toot for their own ends no matter what we may think.   

Instead, we will offer to readers who may find them interesting, rationale applying to current sub issues of the gas pipeline debates:

1.  Efforts to force use of gas pipeline project labor agreements (PLAs), by LAW, will have at least several major effects:

  • Even if investors were to want PLAs, forcing them to use PLAs by law makes their bargaining position with unions weak.  To get the best deal for shareholders and the lowest transportation costs for consumers and the highest royalty and tax returns for government requires the investors to secure the most reasonable and competitive possible employee costs  (i.e. which we are told could approach a third of the $45-65 billion project cost).  If unions which will negotiate PLAs with investors, know there will be no pipeline without PLAs they can hold out for exorbitant hourly rates and benefits.  Indeed, their negotiations could push the project into a competitive wilderness from which no viable project would emerge.
  • PLAs will not, as advocates claim, further the hiring of Alaskans.  Virtually all competent and qualified oil & gas  backgrounded Alaskans in this lightly populated state are now employed.  It would be in the interest of investors to hire as many long time, qualified Alaskans as possible.  Having a several year boom-time of pipeline jobs will -- as with the Trans Alaska Pipeline System (TAPS) in the 1970s -- suck much qualified talent away from existing Alaska employers forcing them to hire 1) less qualified Alaskans, and/or 2) immigrants to Alaska.  After construction, the long term, qualified Alaskans who left normal, private sector jobs will be faced with taking less attractive jobs in the normal market or moving away from the state to oil and gas projects that demand more experienced talent.  The real beneficiaries of government-forced prevailing wage/PLAs are unions that can expand membership, collect dues and use that wealth, in part, to support their favorite political candidates.  Accordingly, lawmakers should be wary about interfering too much with the invisible hand of economics and free enterprise less they reap unintended -- rather than utopic -- results.  In political debate, union apologists, claim that a union negotiated PLA still allows non-union companies to bid on pipeline work.  While true, the larger effect is to raise the hourly wage scale of employees to an artificial, negotiated level above competitive market rates which both union and non-union employers would have to pay.  It certainly does "even the playing field" between union and non-union companies, making it no more advantageous to hire competitive non-union than union contractors.

2.  "Pay-offs".  We have warned over the years that the singular focus of "monetizing Alaskan resources" is in the constitutional best interest of Alaskans.  With maximum monetary value derived from natural resources, the legislature and governor can then allocate the money to public uses.  However, special interest advocates claim that the gas resource must --by law -- provide more than monetary benefit to Alaska.  Some rural politicians have even said they would only support current gasline legislation if their remote communities receive a direct benefit of the pipeline.  Monetizing Alaska's gas to help the state continue delivering programs throughout Alaska is not enough.  This is where politicians encounter a thousand rabbit trails, seducing them into tempting areas far removed from simply monetizing the gas.  For example:

  • Alaska communities not near gas pipeline facilities will argue for funding socialized energy programs in their areas.  
  • Some might ask for propane to be split off from the gas stream and provided to them via subsidized projects.  
  • Some will ask for subsidized LNG/barge distribution projects to serve coastal communities.  
  • Some will want subsidized LNG storage and local distribution facilities, because their cost will be exorbitant.
  • The pipeline project involves a state agency (i.e. Alaska Gasline Development Corporation {AGDC}).  That will usher in other challenges, including both subtle and bold requests from public officials, friends, family and private influence leaders to provide employment, contracts and other favors involving public funds.  Without a formal audit procedure, public monies and project performance are at risk.
  • Then, there will be those who will politically harass investors (i.e. oil and gas companies) to subsidize the cost of natural gas, LNG and propane to their communities in return for not molesting them with tax bills during legislative sessions or tax referenda at any time.
  • Many of these unanticipated burdens accompanying state participation in a private project can not only lower state income but also increase state operating costs.

Our Gentle readers can see why we decided against publishing a longer treatise on this matter today, as the Alaska Senate and then the House approach decisions on Alaska gas pipeline Senate Bill 138.  There is much more that could be said, but it could only add to an impression that we are "just being negative", rather than what we believe we actually are: optimistic by nature, but realistic.

Even after reading this summary of current challenges, we believe reasonable minds will conclude that the weight of government interference in a private enterprise project inversely affects the project's efficiency and competitiveness. 

So, question: rather than just be relegated to the critics' peanut gallery, what would we be inclined to do were we to have absolute power?

Answer: We would sell oil and gas leases in the private market for the highest price.  We would loudly proclaim that, "in reliable Alaska, a deal is a deal and we put great value on protecting our reputation".  While our constitution gives us the sovereign power of taxation, we are loathe to use that power selfishly, negatively or in ways that diminish our integrity as a respected, sovereign state.  We would endeavor to never change the tax/royalty/regulatory rules of the game affecting an investment for at least 20 years--except to moderate the impact of those burdens in response to logic and our competitive position with respect to competing markets.  We would control the nearly insatiable appetite for increased spending beyond our means, knowing that run-away spending could force us to raise tax burdens and decrease our competitive ability to attract investment.  We would not impose any unnecessary costs (i.e. "must haves") on energy projects that diminished the maximum monetary returns; we would then be free to consider use of those maximum returns for social or capital needs of our citizens.

In this way, we would seek to not add an unnecessary and burdensome straw to the back of a project that needed every possible advantage to compete in the world energy marketplace.  

We would not risk adding one single incremental project cost that could kill a project.  

We would not flirt with disaster.

And that, Dear Reader, would lead us to become a place in the world where investors have confidence that, "a deal is a deal".

(We invite comments!)


Today's gas pipeline related energy links from the Office of the Federal Coordinator:

Categories:
Syndicate content