3-31-13

31 March 2013 5:49pm

Petroleum News Alaska.  ANWR's fate on hold (Full story) A federal website says a “record of decision” is due this spring on a new management plan for the Arctic National Wildlife Refuge, including a potential recommendation to designate more of the refuge as wilderness. But an official with the U.S. Fish and Wildlife Service, which manages ANWR, said the....

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3-30-13

30 March 2013 8:51am

Valdez Star.  The war of words between city officials in Valdez and Alaska House leaders in Juneau over natural gas development has moved to Facebook.  The latest disagreement between the two erupted last Thursday when Republican leaders in the Alaska House posted negative statements on its Facebook page regarding the city’s media campaign against HB4.  The AK House Majority said this in its post “An advertising push is being made by the City of Valdez against the Alaska Stand Alone Pipeline project and Rep. Mike Hawker and Speaker Mike Chenault's House Bill 4. Here's the ASAP Project page. Click over and get informed on the only real project moving forward to bring Alaska's gas to Alaskans.”  (Scroll down for yesterday's links on this subject.  -dh)

3-29-13

29 March 2013 5:40am

Chicago Tribune Editorial.  The president should approve the Keystone XL pipeline, which would link the rich oil sands in the Canadian province of Alberta to U.S. refineries and ports in the Gulf of Mexico. Last Friday evening, 17 Democrats joined all of the U.S. Senate's Republicans in urging Obama to do just that. The 62-37 vote was nonbinding but signaled bipartisan frustration with the administration's reluctance to approve the project.

Seward Phoenix Log by Wolfgang Kurtz.  There’s no plan to get critical natural gas supplies to Mike Chenault, Alaska, Speaker of the House, Representative, Kenai, AGDC, AGIA, HB4, Photo by Dave HarbourSouthcentral Alaska that has the momentum that the Alaska Gasline Development Corp. Alaska Stand-Alone Pipeline project has, according to District 34 Representative Mike Chenault (NGP Photo). Chenault, who is serving as speaker of the house, discounts other initiatives as mere proposals at best. Furthermore, with Conoco-Phillips apparently due to abandon their long standing export permit for Cook Inlet gas from their Nikiski facility, there may be onerous demands to be faced for export permits.  Chenault also pointed out at a town hall meeting on Saturday that interest from end users could merely be them leveraging the market to add the Alaska supply to a global pool. The more capacity available, the lower price buyers have to pay, according to that theory. He reasons that it’s quite easy to get stated interest in exporting Alaskan gas but much more difficult to get a contract  (Ref. HB4)

 

Fairbanks News Miner.  The supporters and opponents of a state-backed small-diameter natural gas pipeline from the North Slope to Southcentral Alaska sparred over broad legislation that would allow the state to continue work on what could be a $7 billion project.  On Thursday, the House Finance Committee heard from Alaska Gasline Port Authority general counsel Bill Walker, who was speaking on behalf of the city of Valdez, which launched a $900,000 ad campaign against House Bill 4.

 

Meera Kohler, AVEC, Alaska Village Electric Cooperative, Photo by Dave HarbourYesterday, Meera Kohler (NGP Photo), President of the Alaska Village Electric Cooperative, briefed Commonwealth North (CWN) members on, "a new proposal to transmit affordable electrical energy statewide and monetize Alaska's stranded North Slope gas resources."  According to CWN, "High Voltage Direct Current technology, in conjunction with modern high efficiency compound gas turbine generation has the potential to provide a cost effective means of powering the Railbelt, taking Alaska gas to market and integrating Alaska's diversified and spatially scattered population centers into a viable economic engine."

 

3-28-13

28 March 2013 7:24am

Calgary Herald.  In a decision that concluded tolls cannot increase every year to offset lower volumes moving through a pipeline, the National Energy Board has rejected sweeping changes put forward by pipeline giant TransCanada on its fee structure to move natural gas in Canada.

Our Friends at Resource Development Council  for Alaska (RDC) Alert Us About Tomorrow's Deadline:
 
The U.S. Army Corps of Engineers has begun the scoping process for the Donlin Gold LLC project Environmental Impact Statement (EIS).  The Corps is accepting comments, questions, and suggestions to be considered and used to help identify concerns and benefits of the project in the draft EIS. Comments will be accepted through this Friday, March 29.  Action requested: RDC encourages citizens to submit written comments urging the Corps to include social and economic benefits, and other potential opportunities that development of Donlin Gold may create, in the EIS.  Please consider personalizing your comments by using your perspective and including specific examples of the potential benefits resulting from development of the project.  For more information and talking points, please visit:  http://www.akrdc.org/alerts/2013/donlineisscopingalert.html  (NOTE: NGP frequently reminds our Canadian and American readers of the importance of chiming in on all resource issues since many permitting/regulatory principles are common to many industries.  A dangerous mining or commercial fishing regulatory precedent could negatively impact energy decisions.  Examples: EIS, ESA, NEPA, CWA, CAA, Ocean Policy Task Force Zoning, etc., etc. etc. {sic.})  -dh
 
Joe Dubler, AGDC, Alaska Gasline Development Authority, AHFC, Bond Rating, Photo by Dave HarbourInquire Herald (AP) -- Alaska's creditMike Hawker, Alaska House of Representatives, AGDC, Alaska gas pipeline, bullet line, HB4, Photo by Dave Harbour rating could take a hit if the group behind an in-state natural gas line can't meet its obligations.  So says Joe Dubler (NGP Photo-L), vice president and chief financial officer for the Alaska Gasline Development Corp.  He told House Finance it would be a "big problem" for Alaska's credit rating if the state failed to recapitalize a proposed reserve fund to help AGDC meet its debt obligations.  An aide to Rep. Mike Hawker (NGP Photo) said the bill's sponsors were prepared to offer an amendment to address concerns surrounding that. It's not clear to what extent, or whether, the fund might be used.
 
Bill Sheffield, Alaska Governor, AGDC, gas pipeline, Photo by Dave Harbour 
(Former gov stumps for gas pipeline - Kenai Peninsula Online.  Bill Shieffield (NGP Photo) voices support for an in-state natural gas pipeline during a ... has appropriated $72 million for AGDC's Alaska Stand Alone Pipeline, ...)
 
 
 

 

Today's energy news courtesy of Consumer Energy Alliance:

Houston Chronicle: Busted theory - As for environmental impacts, the EPA credits increased use of natural gas for reducing air pollution across the country. Carbon dioxide emissions are also at a 20-year low thanks to natural gas. State and federal regulators, meanwhile, have been nearly unanimous in stating that hysterical claims about hydraulic fracturing - including water contamination, air emissions, and health threats - are pure invention. The only bubble that's about to burst - if it has not already - is the nationwide campaign against hydraulic fracturing, of which Owen's op-ed was an unfortunate part.

 
Florida Voices: Florida, U.S. Making Big Gains in Renewable Energy - The national conversation on energy production over the past few years has focused -- rightly so -- on the boom in oil and natural gas. U.S. oil production is at a 15-year high and last year saw the greatest jump in production since the industry began in 1859. This energy boom is not limited to oil. Due to breakthrough technologies in hydraulic fracturing and horizontal drilling, U.S. natural gas production is also at an all-time high. This combined activity drove a whopping $138 billion in capital investment in 2011. It’s hard not to focus on these numbers. But the United States has another energy story to tell. The country’s renewable energy resources have grown steadily over the last several years as federal investments have helped the emerging wind and solar industries come into their own.

 

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3-27-13

27 March 2013 9:48am

Message from Governor Sean Parnell: 

Alaskans are one step closer to realizing more economic opportunity through increased oil production.
 
Alaska, Governor, Sean Parnell, State Senator, Cathy Giessel, oil taxes, ACES, Photo by Dave HarbourLast week, the Alaska Senate passed Senate Bill 21, legislation to increase our competitiveness and grow our economy. This is welcome news for Alaskans, especially those who care about the long-term prospects for our state.
 
Although oil production in Alaska has been declining over the past decade, SB 21 offers an Alaska comeback in oil production. The Senate-passed measure will put us on a path to reclaiming our standing as America’s greatest oil-producing state.
 
As Senator Cathy Giessel (NGP Photo archive with Governor Parnell) said on the Senate floor, "This is about the progress of Alaska, our private-sector economy, and its potential growth.”
 
I commend her and her colleagues in the Senate who voted for Alaska’s future, not status quo decline.
 

 

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3-26-13

26 March 2013 9:29am

 

Tax Panel Reviews Impact On Coming Generations
 
By
 
Mary Barr
 
The Political Science Association of Alaska and Alaska College Republicans presented a panel last Wednesday (i.e. 3-20-13) at the University of Alaska-Anchorage campus, targeting  the impact of today’s tax policy on future prosperity.
 
Event Chair, Portia Watson, introduced the event moderator, Dave Harbour, publisher of Northern Gas Pipelines.  He opened the evening with a question of “intergenerational equity”.  Do we want the next generation to have the opportunities we now have, and how can we achieve that goal?  How should we proceed with the allocation of Dr. Scott Goldsmith, Oil Taxes, Soft Landing, Institute of Social and Economic Research, University of Alaska - Anchorage, Photo by Dave Harbourour resources to assure future prosperity for our children?
 
Dr. Scott Goldsmith (NGP Photo), Professor Emeritus of Economics, contrasted the methods of financing Alaska’s operating budget with techniques used by other state governments.  Where other states support themselves with a diversified variety of taxes and fees, Alaska derives 95% of its state revenue from one source: the petroleum industry.  As production has fallen, state spending has soared creating an unsustainable model.  The question becomes how to find a balance to allow a viable economic future for coming generations.
 
Andrew Halcro, former legislator and current chairman of the Anchorage Chamber of Commerce, reviewed the politics of the relationship between the state and the petroleum industry over the last 40 years.  Oil company revenue includes a corporate income tax, property tax, royalty payment, and a severance (i.e. or, production) tax.  Progressivity of the production tax discourages investment, and Alaska’s tax structure has become punitive.  Halcro said that Alaska has become a state that pays people to live here.  Alaskans seem to have no apparent interest in reining in  government spending but are highly focused on continuance of Permanent Fund dividend checks for themselves..
 
Dr. Forest Nabors, Professor of Political science reviewed the lack of diversification in the economy and how the federal tax structure disrupts upward mobility.  The current federal tax code actually creates an assigned strata of “class” that discourages upward mobility.  He said that entrepreneurs create wealth when they’re successful, but that as a business succeeds, taxes become more punitive creating a barrier to obtaining true wealth.  The inheritance tax, he said, makes passing a successful small business to the next generation very difficult.  He noted that Alaska has few if any entrepreneurs due to such political barriers.
 
Harbour wound up the evening with comments on the Norway model of managing taxation and regulation.  “In Norway,” Harbour said, “a deal is a deal”, with tax, regulatory and environmental issues agreed to in advance of an oil company’s investment.  “In Alaska”, he said, “a deal is not necessarily a deal”.  He said that while a company’s bonus bid and lease sale royalty payments provide revenue certainty to Alaska,  the rate paid on each of Alaska’s three oil taxes can increase – even retroactively and with little notice -- upon a vote of the legislature and the signature of a governor. 
 
“Some legislators demand guarantees from the oil industry in return for tax reform”, Harbour said, “but when government acts to increase taxes, no one asks “where is the industry’s guarantee from the state that higher taxes will produce improved state services?”
 
“If the state provides investors with a predictable investment climate,” Harbour said, “the coming generation can have more certainty that their way of life will be filled with as much opportunity as their parents experienced.” 
 
Harbour also asked the audience to define the word, "people", as it is used in Alaska's constitution: "Article 8, Section 2. says, 'The Legislature shall provide for the utilization, development, and conservation of all natural resources belonging to the State, inclucing land and waters, for the maximum benefit of its people.'"
 
"Here's the question I would leave you with," Harbour said.  "Did the founders intend to define 'people' as limited to today's generation, or does the definition include all present and future generations of Alaskan people?
 
"If the definition includes only today's adults and kids," he said, " then their elected representatives would be right in taxing all productive businesses to the hilt, to benefit the contractors, public employees, entitlement programs and today's other beneficiaries--even if those taxed businesses were not in business a generation from now.
 
"But," he said, "if the definition of 'people' also includes future generations of Alaskans -- you and your kids -- then today's policies should be designed to make Alaska a good place to invest, both now and into the future."
 (Note: NGP always invites participants and knowledgeable readers to provide additions/corrections to our work.  Accuracy is one of our goals.  -ed)

 

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