News

Reality bites

chart

The long slide in Alaska oil production

Alaska squeaked back in front of California in September to regain its position as the nation’s sixth-largest oil producer, but as U.S. oil production has grown in this decade it is stunning what a small player the 49th state has become on the national stage.

September’s northern production of about 13.5 million barrels was a significant increase from August production, according to the U.S. Energy Information Administration (EIA), but it was less than a tenth of the production of Texas, about a third of the production of North Dakota and about half of New Mexico.

Late and iconic Gov. Jay Hammond’s long-ago observation of Alaska’s role as “oil barrel to the nation and national park to the world” is now down to the latter. The implications for the Alaska economy are large.

Visitors to the state’s national parks contributed $1.4 billion to the state economy last year, according to National Park Service estimates. That looks like a big number, but it is a tiny fraction of the revenue generated by the oil industry, and tourists yield the smallest of tax revenues.

Tourism-related taxes support the Denali Borough – home to the world-famous Denali National Park and Preserve which generates more than 65 percent of park visitor spending – but there is no statewide tourism tax.

Oil royalties and taxes continue to produce about three-quarters of the non-investment income flowing into state coffers, according to the state’s Fall 2019 Revenue Sources Book.

The more than $2 billion the oil industry contributed last year is $600,000 more than the entirety of the revenue generated by park tourism. Oil money helps fund infrastructure for that same tourism industry, and underwrites the costs of managing the state-subsidized commercial fishing business.

Commercial fishing, the state’s second-largest employer behind tourism, costs the state significantly more to operate than it generates in tax revenues, and the tourism industry doesn’t quite break even for the state, according to the University of Alaska’s Institute of Social and Economic Research (ISER).

The mining industry does better;  it “brings in about six times more than the state spends to manage it,” according to the ISER report. But the industry is small. Its $82 million net contribution to the state is peanuts compared to oil revenue.

Not to mention that mining is not particularly popular in Alaska.

Favored status

To greater or lesser degrees, the downward pressure of negative popularity applies to almost every industry except commercial fishing which was enshrined as special in 1972 when voters amended the Alaska Constitution to create a special class of “limited entry,” commercial permit holders “to prevent economic distress among fishermen and those dependent upon them for a livelihood and to promote the efficient development of aquaculture.”

Eighteen years later, the potentially most profitable form of aquaculture – salmon farming – was banned in Alaska because the state’s commercial fishermen feared fish farms would undercut the market for wild fish and once again cause economic distress among fishermen.

The world, unfortunately, ignored the ban. Salmon farming exploded in Norway, Chile and elsewhere. Today, the farmers produce more than 70 percent of the salmon consumed in the world and set the base market-price.

Thanks in part to a warming ocean, Alaska’s wild salmon production has been on an upward trajectory, allowing fishermen to make up in volume for what they lost in price due to the boom in farmed salmon. But there is almost nowhere to go now but down for Alaska production while farmed fish numbers are only expected to keep increasing.

Rabobank, Dutch-based bank specializing in international food and agriculture financing, last year reported the aquaculture business had grown by $100 billion in the previous six years and projected another $100 billion increase in the next decade.

Alaska, meanwhile, lacks any growth industry other than tourism, and there are always Alaskans grumbling about “too many tourists.”

“We don’t agree about what kind of development we want,” economist Gunnar Knapp, professor emeritus ISER, noted in a powerpoint presented at a conference in November. “Almost every Alaska resource development opportunity – oil, mining, logging, cruise ships, sport fishing lodges, fish farming – is opposed by at least some local residents or other resource users who prefer to keep things as they are.”

A look back

Before Congress finally granted Alaska Statehood in 1959, the biggest concern among federal lawmakers was that the state big on land but short on people might prove unable to sustain itself. A significant oil find in Cook Inlet in the ’50s helped ease that concern to push statehood forward, and when the mammoth Prudhoe Bay oil field started pumping oil through the Trans Alaska Pipeline System in 1977, everything changed. 

By the late 1970s with the national crisis caused by the  Arab Oil Embargo of 1973-74 still clearly in the nation’s rearview mirror, then Alaska Commissioner of Natural Resources Bob LeResche was joking about Alaskans as the new “blue-eyed Arabs of the north.”

Over the decades to follow, the state collected tens of billions of dollars in oil revenues, grew state government, poured cash into civic centers and schools across the state, fixed its few roads, tried to diversify its economy, and grew a Permanent Fund now worth about $65 billion.

It was once hoped the fund could support the state, but it’s becoming increasingly obvious that it cannot close the gap between shrinking oil tax revenues and state spending, let alone cover that gap and pay Alaskans what has come to be a cherished permanent fund dividend, a share of the state’s oil wealth as Hammond and others called it.

The conservative Alaska Policy Forum calls Gov. Mike Dunleavy’s proposed, $4.5 billion dollar budget for fiscal year 2021 “unsustainable,” citing plans for a nearly $2.5 billion dip into state savings to make the plan pencil.

What other solution might be possible is unknown. Neither new taxes nor budget cuts are popular in the state. Dunleavy tried to make significant cuts in the budget last year only to see a campaign launched to recall him from office. 

Given the fiscal problem, efforts are now underway to put an initiative on the 2020 ballot that would increase oil taxes to produce more revenue for the state. The long term consequences are unknown with initiative critics arguing a tax increase  will continue or accelerate the decline in oil production by discouraging investment in the 49th state, and initiative supporters arguing that’s all a big bluff designed to scare Alaskans away from collecting their “fair share.”

BP, the third-largest, publicly traded oil company in the world and a leader in developing Alaska North Slope oil from the 1970s on, is already in the process of pulling out of the state. A bureaucratic behemoth that needs to generate huge profits to feed itself, BP decided the returns on its Alaska operations had shrunk to the point it couldn’t afford to stay.

Whether that portends similar decisions by other oil producers if taxes increase is impossible to know, but everyone familiar with the oil industry agrees there are cheaper places than Alaska to produce crude these days. Technology that expanded the reach of oil production in the Lower 48 appears to have brought to Alaska’s oil patch the same problems that have always hampered industrial and manufacturing development in the state.

As Knapp, put it, “Alaska faces significant economic development challenges:

  • “Alaska is a high-cost place to do business.
  • “It’s hard for many kinds of economic activities to be competitive with
    other places that have: lower labor costs, better infrastructure, larger internal markets (and) lower transportation costs to world markets.”

A new path?

Alaska Labor Department economist Neil Fried has suggested Alaska might try attracting “climate refuges,” given the northern location of the state’s largest city, and the quality of life it offers.

There aren’t any other places in the world where you are liable to encounter a wild grizzly bear during a day hike before attendance at the evening’s opera.

Recognizing technological research and development as a big driver of global economies, Gov. Mike Dunleavy made a pitch to Tesla to bring production of its proposed, battery-powered cybertruck north to Alaska.

“It is difficult to deny that Tesla and Elon Musk are now being perceived as a potential economic booster for areas where its facilities are located at,” reported Teslarati.com.“Reno, Nev., for example, is seeing businesses come to the area due to the presence of Gigafactory 1. A facility that produces electric cars in Alaska will likely have the same effect.”

A Tesla move to Alaska, however, seems most unlikely.

Dunleavy, a Republican, might have done better to ask fellow Republican President Donald Trump to back development of the Anchorage metro area as the nation’s first tech “growth center,” an idea being pushed by Brookings, a well-known think tank.

“The future of America’s economy lies in its high-tech innovation sector, but it is now clear that the same sector is widening the nation’s regional divides – a fact that became starkly apparent with the 2016 presidential election,” Brookings concluded in a report issued earlier this month.

“Based on ‘winner-take-most’ network economies, the innovation sector has generated significant technology gains and wealth but has also helped spawn a growing gap between the nation’s dynamic ‘superstar’ metropolitan areas and most everywhere else.

“Neither market forces nor bottom-up economic development efforts have closed this gap, nor are they likely to. Instead, these deeply seated dynamics appear ready to exacerbate the current divides.”

Brookings suggested Congress propose a set of metropolitan areas to be endowed with a “major package of federal innovation inputs and supports that would accelerate their innovation-sector scale-up.”

In the Brookings view, growth centers backed by “substantial financial and regulatory support for 10 years to become self-sustaining new innovation centers…would not only bring significant economic opportunity to more parts of the nation, but also boost U.S. competitiveness on the global stage.”

Though Brookings’ pitch was to Congress, there is no reason the executive branch couldn’t lead a charge to funnel funds into a historically red state in the name of not only economic but political diversity.

As Brookings points out, tech is now concentrating in a handful of “superstar” megapolises all of which happen to be blue.

“Most notably, just five top innovation metro areas – Boston, San Francisco, San Jose, Seattle, and San Diegoaccounted for more than 90 percent of the nation’s innovation-sector growth during the years 2005 to 2017,” the study said. “As such, they have increased their share of the nation’s total innovation employment from 17.6 percent to 22.8 percent.

“In contrast, the bottom 90 percent of metro areas (343 of them) lost share. As a result, fully one-third of the nation’s innovation jobs now reside in just 16 counties, and more than half are concentrated in 41 counties.”

Bust, bust and bust

There is, of course, no guarantee a regional growth center in Alaska would work any better than past government attempts at economic expansion in the cold, dark north.

“The federal and state governments have a generally poor track record in creating sustainable, profitable private-sector industries in Alaska by spending money,” Knapp observed. “Businesses which need government support to get started often need government support to keep going.”

But that doesn’t mean a new effort isn’t worth a try in a state where the sector of the economy that long supported almost everything is fading.

Had California production not slumped slightly in September, Alaska would have remained the nation’s seventh-largest oil producer as it was in August behind the three aforementioned states plus Oklahoma, Colorado and California.

Most of them are upping production while Alaska production has flatlined.

Despite slumping global oil prices, the EIA “expects U.S. crude oil production to average 13.2 million barrels per day (b/d) in 2020, an increase of 0.9 million b/d from the 2019 level. Expected 2020 growth is slower than 2018 growth of 1.6 million b/d and 2019 growth of 1.3 million b/d. Slowing crude oil production growth results from a decline in drilling rigs over the past year that EIA expects to continue into 2020. Despite the decline in rigs, EIA forecasts production will continue to grow as rig efficiency and well-level productivity rises, offsetting the decline in the number of rigs.”

Growing U.S. production is in turn expected to keep oil prices relatively low despite planned reductions in oil production by members of the Organization of Petroleum Exporting Countries (OPEC), according to the federal agency. The U.S. is not an OPEC member but in September became for the first time a net oil-exporter.

“The United States exported 90,000 b/d more total crude oil and petroleum products in September than it imported,” the EIA reported. “This is the first month recorded in U.S. data that the United States exported more crude oil and petroleum products than it imported” since 1973.

The shift marked the crossing of trend lines which have shown U.S. oil exports growing since 2009 as U.S. oil imports shrank. U.S. production shot up from 5.3 million barrels per day in 2009 to 12.1 million barrels per day through September 2019, according to the EIA. The U.S. production helped boost global supply.

Because of this, EIA “expects crude oil prices will be lower on average in 2020 than in 2019 because of forecast rising global oil inventories, particularly in the first half of next year.”

And that’s just more bad news for Alaska. Because of lower prices, the state is now looking at only about $1.5 billion oil royalty and tax revenue in 2020, according to the revenue source book.

 

 

 

 

31 replies »

  1. You cannot just compare Alaska to other states, you must examine the global market that is controlled by OPEC.
    When taking a larger picture look at the situation, we the state of Alaska are only putting out about half as much oil each month as Venezuela.
    This is in spite of all Trump’s sanctions and attempts at coups in that country.
    Alaska no longer has as big of a seat on the global market and that is not likely to change again in any of our lives.
    The big boys have picked over the patch up north and now the small time scavengers need a billion dollars of tax credits a year to keep drilling…this is definatly not sustainable for long term prosperity in AK.

    • …Trump’s sanctions and attempts at coups in [Venezuela].

      Venezuela had worked itself a long ways down the potty, back when Trump was happily doing The Apprentice.

      The villainy of corporate business is likewise a tad overworked. Without the industry & pipeline, that tax credit would start looking like a pretty cool plan.

    • Venezuela has the largest proven reserves on the planet, about 10 times more than Alaska. The fact that they are once again proving that Socialism always fails is the reason they are only producing twice as much oil as Alaska is. Comparing Alaska to a foreign country that seized private property and ran it into the ground should be a lesson for those who want to do the same thing here, unfortunately socialist never learn from history.

      Can you provide any proof that Trump is leading attempted coups in Venezuela or are you just repeating the state sponsored propaganda of Venezuela again?

      • Steve O,
        You must be privy to proprietary knowledge regarding ANWR, since to my knowledge the exact amount of oil available on the coastal plain is a top U.S. secret…although BP was privy to the results from that single well drilled in 1985.
        It may explain why BP is really leaving?
        “For more than three decades, the findings from the $40 million exploratory well have been one of the oil industry’s most closely guarded secrets.
        Outside of the oil giants that paid for it, only a handful of people know what was discovered there.”
        “The discovery well was worthless,” said Sidney B. Silverman, a retired lawyer who was involved in a long-since-forgotten lawsuit filed there in 1987.

        https://www.nytimes.com/2019/04/02/us/arctic-oil-drilling-well-data.html

      • Steve,

        I used my fingers to type words into the Google box, you can do that also…and inform yourself.
        The information I provided is not proprietary nor is it top secret, it is literally available to anyone with a computer, including yourself. In the oil world proven reserves is how oil abundance is measured. Using the Google box you can even look up the term “proven reserves”, when I did just that I found the following information:

        “Proven reserves is the quantity of natural resources that a company reasonably expects to extract from a given formation. Proven reserves are established using geological and engineering data gathered through seismic testing and exploratory drilling. In oil and gas extraction, once the physical shape of a formation is understood, the reservoir is estimated by fluid contacts. Fluid contacts refer to the natural layering of gas, oil and water in a formation. An accurate picture of the formation shape and known levels of fluid contact provide the data for a volume estimate with a high degree of confidence. Proven reserves are classified as having a 90% or greater likelihood of being present and economically viable for extraction in current conditions. Proven reserves are also referred to as proved reserves. Within the oil industry, proven reserves are also referred to as P1 or P90.”
        https://www.investopedia.com/terms/p/proven-reserves.asp

        I will stop holding my breath on your ridiculous claim that Trump is leading attempted coups in Venezuela.

      • Your correct Steve O…you have No idea what that test well in 1985 showed up in ANWR (but BP does know the results and they left AK).
        You are using Google to decide how much oil is on the Coastal Plain in AK.
        Well, you can just as easily use Google to see that the Trump administration has ties to the current mess in Venezuela.
        There are many declassified reports that now show Elliot Abrams led the 2002 coup attempt in Venezuela for the Regan Administration.
        What do you know he was just “re appointed” again to lead the charge against Venezuela?
        “Abrams is widely remembered in Central America, but particularly from his time in the Reagan administration, when he tried to whitewash a massacre of a thousand men, women and children by US-funded death squads in El Salvador, when he was assistant secretary of state for human rights…
        Elliott Abrams, who was linked to failed coup against Chávez, to join Pompeo to urge security council to recognize Guaidó as head”

        https://www.theguardian.com/us-news/2019/jan/26/elliott-abrams-venezuela-us-special-envoy

      • Steve,

        First, I never claimed to know anything about the results of the 1985 test well, if you think I did please reread what I wrote right up there^ and review the term proven reserves again. The thing about proven reserves is that they are by definition proven, whatever crazy conspiracy theory you are going on about has nothing to do with the proven reserves in Alaska or Venezuela.

        Second, Ronald Reagan wasn’t President in 2002 neither was Donald Trump…seems like your Google box is broken.

      • That was my mistake…
        2002 it was Bush who led the Coup attempt in Venezuela (Abrams was his main man).
        This is now declassified by the CIA and public knowledge.
        Abrams is linked to Central America way back since the Reagan administration (El Salvador it was back then)…
        Abrams is (as the Guardian points out) a “diplomat convicted over Iran-Contra appointed special envoy for Venezuela”.
        Nice guy for Trump to have working on “Diplomacy” in Venezuela these days.

      • So you have no proof that President Trump is leading attempted coups in Venezuela, you just have faulty information and further accusations about past presidents leading attempted coups? Thanks for playing Steve.

  2. After the build-up of WW II, Alaska was on track to get rich, gain population and – uh-oh – become an independent nation.

    That outcome was contrary to top-level ideas of the USA, who saw the sub-continent as an important chess-piece in the strategic game with Russia, Asia, and the world.

    Two things needed to happen. Alaska needed to be sufficiently buttered-up to slide along with plans in Washington DC, and their famous but pesky streak of Individualism needed to be addressed.

    Today much of Alaska is spoiled by an abnormal amount of unhealthy attention from The Establishment, and a corrupting relationship with The Swamp.

    It probably doesn’t matter, because most true Alaskans have never been to the state, they’re available in large numbers, and would be easily recruited. It matters less now that they still Cling to (‘pathological’, some intone) Individualism, because Statehood is a done-deal.

  3. It seems like most Alaskans (and 100% of Democrats) don’t get the simple high-level math. In generalized numbers – Alaska spends $10 billion on 735,000 people. That’s around $13,600 per person. And it’s over twice as much as the average spend rate by state government per capita in the rest of the US states.

    People (i.e. unions, state employees, the entitlement-addicted, Natives, etc.) that think state government has cut to the bone … they need to tell us why Alaskans are worth twice as much as citizens in other states of the US. Good luck with that. Because Alaskans are definitely not worth more than the average American.

    So when it comes to cutting state government, Alaska hasn’t even started. That’s proven by our government spend rate that is twice the national average. Yes a lot of that difference is due to the fact that we support a 3rd world country with a welfare addiction and no economy … the Bush. We need to quickly wean the Bush off state tit. Time for them to stand, or fall, on their own.

    We need to ask where are we spending way more than the national average per capita. Once we know, then we then stop doing it.

    • James, you hit a few buzz words that all add up – 100% Democrat + 3rd World + Welfare addiction + depencency + state tit = lifetime of votes.. Genious really.
      Did you happen to see that 14yo white kid on the school bus bullied by black kids because he was wearing a MAGA hat? Seems some haven’t gotten the message (by design) that Trump has done more for the black.and Hispanic communities then Obama. Hmm, imagine that.

    • All good points James,except for one glaring omission.The “I want my free $ crowd,(dont touch my PFD!)tend to vote republican, and its been that way for decades.
      Everyone loved uncle Teds bag of Xmas $’s

  4. Attracting tech industries requires large amounts of reliable, cheap and green electricity.
    Find 100 acres and install a set of Generation IV power plants.
    The are reliable, generate relatively inexpensive power, can be scaled to demand and emit no carbon.
    Bill Gates is promoting them as the environmental answer.

    Then all Alaskan’s need to figure out is how to make their weather more competitive.

  5. The lower 48 is awash in oil, along with the rest of the oil producing countries.
    This oil is produced at a lower cost than ANS. Alaska oil is not in demand as it once was. Over tax them, and they will no longer explore.
    Time to get real. The state needs to have 200K less residents, or come up with new sources of revenue.
    The Feds are done subsidizing states, that cannot balance their own budgets.
    This is not the 80’s, we can no longer afford the state budget we once had. Spending needs to be curtailed, so we bring in more, than we spend. No lower 48 company will invest in a state, with high energy, food and living costs.
    Alaska has always been a resource extraction entity, live with that and spend less.

  6. I am reading about the Anthracite extraction in PA over 100 years ago.
    When discovered it was the largest supply of hard coal around the world…it was exported for 50 years to far corners of the globe.
    Coal would feed the industrial revolution and power our ships, railroads and steel mills.
    Eventually oil and gas replaced this fossil fuel giant in global economies and PA Anthracite died in more ways than one.
    Today we are seeing that AK has reached its peak oil production and the shift in world markets is to natural gas and renewable energy sources.
    AK will face a rebranding after the decline of oil that was similar to what PA went through around 100 years ago.
    Today in PA many old coal car railbeds have been transformed into multi use trails that tourists from neighboring states travel to the Poconos to enjoy.
    The last safe mining shaft in Scranton has been converted into a tourist attraction that takes visitors down into the earth.
    Change is inevitable and AK must adapt and adjust to the reality that decreases in oil revenues is just another “new norm”.

    • Steve, I dont find your comment to be accurate at all, just Greta’s pipe dream – “shift in world markets is to natural gas and renewable energy sources.”. Wind, solar, battery powered, etc.. all are EXTREMELY inferior to coal, oil or gas. They just make certain segments of society feel good about themselves and guilt free.
      As for Alaska oil running out, well, that is another fantasy. The problem is an over-abundance of coal and oil from fracking and directional drilling, so much so that we are swimming in it. We cannot export it to China fast enough.

      “Massive oil discovery in Alaska is biggest onshore find in 30 years
      By Matt Egan March 10, 2017: 11:45 AM ET

      Some 1.2 billion barrels of oil have been discovered in Alaska, marking the biggest onshore discovery in the U.S. in three decades.

      The massive find of conventional oil on state land could bring relief to budget pains in Alaska brought on by slumping production in the state and the crash in oil prices.

      The new discovery was made in just the past few days in Alaska’s North Slope, which was previously viewed as an aging oil basin. ”

      https://money.cnn.com/2017/03/10/investing/alaska-oil-discovery-repsol-spain/

      • Oh yeah,
        I guess that is why BP sold out and left?
        Truth is the writing is on the wall.
        New Tesla trucks coming out.
        New electric planes tested in BC.
        Millennials turning back to public transportation and bicycles, mopeds and uber.
        Between the change to renewable energy and the climate change hurting the paradigm of ice roads and winter development, BP has run away from the reserves left in AK.
        Seems like the golden days of oil are coming to an end for AK (just like Anthracite 100 years ago in Pennsylvania).
        Back in the 1900’s over 3/4 of the wealthiest people in America all lived in Jim Thorpe.
        Today, I doubt anyone in that county makes the list.

      • Hmm, Tesla. Not sure I’d count on them to even be around 5yrs from now.. Plus, how much fraud and taxpayers funds did they waste? Their cars are crap as well.
        Also, that electric plane you speak of can barely fly 100 miles, while a 767 using Jet fuel can fly 7,000 miles. Hmm. Just goes to show how stupid gullible Millennials are.

      • Bryan,
        Millennials are not stupid…neither is BP.
        This is right off of BP’s own website:
        “We have been investing in renewables for many years – and our focus today is on biofuels, biopower, wind energy and solar energy…
        Renewables are the fastest-growing energy source in the world today and we estimate that they could provide at least 15% of the global energy mix by 2040.”
        (BP.com)
        You also forget that solar drones are now capable of 24hr flight around the globe.
        “The Skydweller drone, initially developed by an American-Spanish startup involving Northrop Grumman experts, will be “the world’s first fully electric unmanned aircraft capable of carrying large payloads with unlimited range and ultra-persistent endurance,” the firm said.”

        https://www.defensenews.com/unmanned/2019/11/12/leonardo-invests-in-fully-electric-skydweller-drone/

      • Steve, if renewables cannot compete across the board what the hell good are they? Since that is the case, how are we supposed to compete with the Chinese who are working to take over the world while we are trying to “save” it?

      • Bryan,
        Let’s face it…
        The U.S. government has subsidized the energy sector for over 100 years.
        The green energy sector is good since it cuts down on emissions and allows us to be self sufficient and not dependent on say Saudi and OPEC.
        As for China they are investing in quite a lot of renewable energy themselves.
        “China is on a mission to become the next green superpower.
        The country is the largest investor in renewable energy, sinking $126.6 billion into the industry…
        Solar is a big part of those investments.
        By 2020, China hopes to be generating 110 gigawatts of solar power — enough to power more than 30 million homes — as part of an ambitious plan to cut carbon emissions.
        By 2030, China vows to increase the amount of energy coming from non-fossil fuels to 20% of the total (from about 13% currently).”

        https://www.businessinsider.com/china-solar-renewable-energy-panda-farm-2018-6

      • Steve, this is a lie and you know it. I can personally attest to this. This couldnt be further from the truth. This is liberal speak grasping for straws..
        “As for China they are investing in quite a lot of renewable energy themselves.
        “China is on a mission to become the next green superpower.”

      • Bryan,
        No one is saying that China does not pollute and we both know they are still burning a ton of coal…but with that said, they are way ahead of old “uncle Sam” when it comes to solar power.
        “China has more solar energy capacity than any other country in the world, at a gargantuan 130 gigawatts…
        China is home to many sizeable solar farms – including the huge 850-megawatt Longyangxia Dam facility on the Tibetan Plateau, with its four million panels.
        And the largest solar plant in the world at the moment is in China’s Tengger Desert – its capacity exceeds 1,500 megawatts.”

        https://www.bbc.com/future/article/20180822-why-china-is-transforming-the-worlds-solar-energy

      • The only reason BP (following Shell a few years ago) is leaving is the unstable tax and regulatory regime up here. Shell was chased out after the O’Bama regime harassed them every step of the way in their exploration in the Chukchi. The newly elected Walker administration didn’t raise a finger to help. BP is leaving because they can’t make sufficient money up here. If the Fair Share Alaska guys get their wish, they will make even less. There are far more friendly places in the US to explore and produce (Permian, Bakken, etc). That’s where they are going. Difficult to make money on a decades long investment window in new infrastructure in a state that changes (or tries to change) your taxes every other year. And we’re about to do it again.

        The only reason the producers are dinking around with renewables is to keep the green NGOs (many of them funded by Russian and Saudi dollars) and green governments off their back. Think of it as protection money. OTOH, if the dinking around finds something that can actually make them some money, so much the better.

        Ken is correct about Gen IV nuclear. We also have GTLs / CTLs available to batch down TAPS as a Plan B to a LNG pipeline.

        Finally, I want to congratulate Steve Stine on hijacking yet another thread. Well done. (/sarc). Cheers –

  7. Very good information. Guess it’s time we all faced reality. Made a temporary decision to accept a loss of pfd check or complicated user fees as taxes and tax on non food items . Implemented so it doesn’t discourage tourists or buisness to much degree. How to implement I don’t know . It’s time for something. My hat is off to Dunleavy for his attempt at leadership something we desperately need. Mining would work small scale long term but big companies are obsessed with super large projects . Some comprise and leadership out of box thinking is needed . Small scale mining is popular in Alaska and should be floated as a pebble compromise . They used to want a road to pebble which is problematic as roads in Alaska tend to disrupt small salmon streams . Looks like it’s time for compromise and ingenuity- Alaska needs a new Hammond really a bunch of them . Craig is right it’s iffy to suggest the state involve itself in creating new ideas . Their history sucks . Mat maid , dairy, farming, barley, my McKinley meats ect ect . So that seams to leave creating legislation that fosters creative nurturing environment for buisness and personal ingenuity. Personally I would compromise and give up my pfd . I think anyone over 30 should consider it . I think children through college age should not have it touched . IMO . I would also happily pay on luxury goods and even infrastructure I utilize- roads . That said Dunleavy should first be allowed and mandated to extremely slash our government costs . There is still pork and items government shouldn’t shoulder . Support of out of state fishermen and Pink farming being the biggest . Don’t touch my pfd or add taxes until the budget house is clean . Kick those damn free loaders to the curb . They can cut wood in Washington for a living after they pressure trump to stop taking Canadians forest products so the timber industry on west coast can come back . Tariff the double heck out of it / imo . Alaska’s legislative aids are paid wAy to much! The state stocks our lakes with trout and runs hatcheries which is nice but if it doesn’t pay for itself then it’s time to make hard decisions. Cut government costs first and support Dunleavy. IMO

Leave a Reply to Bryan Cancel reply