Thursday, September 24, 2009

What part of will of the people do not our elected officials understand ?

The election of 2002 saw the creation by the will of the people of an entity that is unique among the State’s agencies, boards and authorities. Something since ignored by former Governor Frank Murkowski, former Governor Sarah Palin, and now Governor Sean Parnell and the members of those legislators holding office from 2002 to the present. That something was the Alaska Natural Gas Development Authority (ANGDA).

Let me remind you what we created. I have excerpted the relevant parts that remind us just exactly what we created this authority to accomplish and why it was created. Note the references to the looming Cook Inlet crisis.

You can find the following at

Petition ID: 01GSLN: The All-Alaskan Gasline Initiative:An Act establishing the Alaska Natural Gas Development Authority, to maximize revenues for Alaska and jobs and gas for Alaskans.

(a) The people find that
1. The Phillips-Marathon liquefaction facility at Nikiski has been supplying Cook Inlet natural gas to Japan and Southcentral Alaska at great profit and without interruption since 1969;
Cook Inlet gas supplies are dwindling rapidly with shortfalls anticipated as early as the winter of 2003;
2. Alaska's North Slope contains vast proven reserves of natural gas that have been known for at least 25 years but have never been developed;
3. these gas resources have never been offered for sale, because there has been no way to transport them to market;
4. multiple markets in North America and Asia have recently expressed an interest in receiving a proposal from Alaska for the purchase of Alaska gas;
5. if developed, these natural gas resources could represent substantial economic benefits to Alaskans in jobs, state revenue, and gas for Alaska citizens and businesses;
the major North slope leaseholders have competing gas reserves in other parts of the world vying for the same markets, creating a conflict of interest for them in advancing the sales of Alaska gas;
6. the North slope Producers agreed in 1991 to strand North Slope gas until at least 2005;
given the producer's conflicts of interest and their historic refusal to make North Slope natural gas available it may be necessary to take the gas back;
the permits necessary for an Alaskan gasline project have been pledged to the Alaska Natural 7. Gas Development Authority, operating as a port authority, to facilitate the development of the project;
8. there is sufficient gas for an all-Alaskan gasline project;
9. the Alaska Natural Gas Development Authority offers substantial tax benefits that improve the economics of a gasline project;
10. state ownership of the pipeline and associated facilities has the potential to provide substantial revenues to the state and the Alaska Permanent Fund; and
11. Alaska's constitution requires that Alaska's resources are developed, utilized, and conserved for the maximum benefit of Alaska's people.
12. an all-Alaskan gasline maximizes jobs for Alaskans, revenues for the Alaskan treasury, and access to gas for Alaskans.
(b) It is the intent of this Act to create the All-Alaskan Natural Gas Development Authority for the purpose of developing, constructing, managing, and operating a gas pipeline from the North Slope of Alaska and a spur line to the Southcentral Alaska natural gas distribution grid

What was the anticipated completion date of ANGDA’s project?

1. The goal of the authority is to have the Alaskan gas line in full production by 2007.

Had ANGDA’s mission been executed upon, Alaska and Alaskans would be enjoying revenues from 2 bcf per day of gas exported to Asia at $10 mmbtus, with the jobs, infrastructure and industry from the pipeline, LNG trains, Valdez port improvements and the gas liquids to further enhance and buffer Alaska’s economy from the stupidity in Washington, D.C. Instead, we face rolling blackouts this winter, and a slowing economy.

Remember this disrespect shown our will by our elected officials in Juneau.

Wednesday, September 23, 2009


by Petition Sponsors
Petition ID: 01GSLN
The All-Alaskan Gasline Initiative:An Act establishing the Alaska Natural Gas Development Authority,to maximize revenues for Alaska and jobs and gas for AlaskansPosted 9/20/01

BE IT ENACTED BY THE PEOPLE OF THE STATE OF ALASKA:* Section 1. The uncodified law of the State of Alaska is amended by adding a new section to read:FINDINGS AND INTENT. (a) The people find that
1. The Phillips-Marathon liquefaction facility at Nikiski has been supplying Cook Inlet natural gas to Japan and Southcentral Alaska at great profit and without interruption since 1969;
2. Cook Inlet gas supplies are dwindling rapidly with shortfalls anticipated as early as the winter of 2003;
3. Alaska's North Slope contains vast proven reserves of natural gas that have been known for at least 25 years but have never been developed;
4. these gas resources have never been offered for sale, because there has been no way to transport them to market;
5. multiple markets in North America and Asia have recently expressed an interest in receiving a proposal from Alaska for the purchase of Alaska gas;
6. if developed, these natural gas resources could represent substantial economic benefits to Alaskans in jobs, state revenue, and gas for Alaska citizens and businesses;
7. the major North slope leaseholders have competing gas reserves in other parts of the world vying for the same markets, creating a conflict of interest for them in advancing the sales of Alaska gas;
8. the North slope Producers agreed in 1991 to strand North Slope gas until at least 2005;
9. given the producer's conflicts of interest and their historic refusal to make North Slope natural gas available it may be necessary to take the gas back;
10. the permits necessary for an Alaskan gasline project have been pledged to the Alaska Natural Gas Development Authority, operating as a port authority, to facilitate the development of the project;
11. there is sufficient gas for an all-Alaskan gasline project;
12. the Alaska Natural Gas Development Authority offers substantial tax benefits that improve the economics of a gasline project;
13. state ownership of the pipeline and associated facilities has the potential to provide substantial revenues to the state and the Alaska Permanent Fund; and
14. Alaska's constitution requires that Alaska's resources are developed, utilized, and conserved for the maximum benefit of Alaska's people.
15. an all-Alaskan gasline maximizes jobs for Alaskans, revenues for the Alaskan treasury, and access to gas for Alaskans.

(b) It is the intent of this Act to create the All-Alaskan Natural Gas Development Authority for the purpose of developing, constructing, managing, and operating a gas pipeline from the North Slope of Alaska and a spur line to the Southcentral Alaska natural gas distribution grid.

*Sec. 2. AS 41 is amended by adding a new chapter to read:

Chapter 41. Alaskan Natural Gas Development Authority.Article 1. Establishment of the Authority.

Sec. 41.41.010. Establishment of the authority. (a) There is established the Alaska Natural Gas Development Authority, the purpose of which is to provide one or more of the following services and functions in order to bring natural gas from the North Slope to market, including
1. the acquisition and conditioning of North Slope natural gas;
2. the design and construction of the pipeline system;
3. the operation and maintenance of the pipeline system;
4. the design, construction, operation, of other facilities necessary for delivering the gas to market and to Southcentral Alaska; and
5. the acquisition of natural gas market share sufficient to ensure the long-term feasibility of the pipeline system project.

(b) The authority is a public corporation and an instrumentality of the state within the Department of Revenue.

(c) The authority has a legal existence independent of and separate from the state.

(d) The acquisition of natural gas from the North Slope and its delivery to tidewater for shipment to market by the authority is an essential government function of the state.

(e) The authority may not be terminated as long as it has bonds, notes, or other obligations outstanding.

Sec. 41.41.020. Authority governing body.

(a) The authority shall be governed by a board of directors consisting of seven members from the general public appointed by the Governor and confirmed by the legislature.

(b) The board shall annually elect a chair, and may elect other officers, from among its members.

Sec. 41.41.030. Term of office.

(a) The members of the board shall be appointed for terms of three years, and they may be reappointed.

(b) The terms of the members shall be staggered.

Sec. 41.41.040. Removal and vacancies.

(a) The governor may remove a member of the board from office. A removal must be in writing and must state the reason for the removal. A member who is removed may not participate in board business and may not be counted for purposes of establishing a quorum after the member receives written notice of removal. A member who is removed is not entitled to honoraria, per diem, or travel expenses authorized under AS 41.41.060 for work performed after the member receives the written notice of removal.

(b) The governor shall promptly fill a vacancy on the board by appointment. An appointee to a vacancy shall hold office for the balance of the term for which the appointee's predecessor on the board was appointed.

(c) A vacancy on the board does not impair the authority of a quorum of the board to exercise all the powers and perform all the duties of the board.

Sec. 41.41.050. Quorum and voting. Four members of the board constitute a quorum for the transaction of business and the exercise of the powers and duties of the board. Action may be taken only upon the affirmative vote of a majority of the full membership of the board.

Sec. 41.41.060. Compensation of board members;

per diem and travel expenses. Members of the board are entitled to per diem and travel expenses authorized for boards and commissions under AS 39.20.180.

Sec. 41.41.070. Authority staff.

(a) The board may employ and determine the salary of a chief executive officer.

(b) The chief executive officer may, with the approval of the board, select and employ additional staff as necessary.

(c) An employee of the authority, including the chief executive officer, may not be a member of the board. The chief executive officer and the other employees of the board are in the exempt service under AS 39.25.110.

(d) In addition to its employees, the authority may contract for and engage the services of bond counsel, consultants, experts, and financial advisors the corporation considers necessary for the purpose of developing information, furnishing advice, or conducting studies, investigations, hearings, or other proceedings.

Sec. 41.41.080. Legal counsel. The attorney general
1. is the legal counsel for the authority;
2. shall advise the authority in legal matters; and
3. shall represent the authority in legal actions.Sec. 41.41.090. Conflicts of interest.

(a) Members of the board and the chief executive officer of the authority are subject to the provisions of AS 39.50.

(b) If a member of the board or an employee of the authority acquires, owns, or controls an interest, direct of indirect, in an entity or project in which assets of the authority are invested, the member shall immediately disclose the interest to the board. The disclosure is a matter of public record and shall be included in the minutes of the first board meeting following the disclosure.

Sec. 41.41.100. Budget.

The revenue earned by operations of the authority must be identified as the source of the operating budget of the authority in the state's operating budget under AS 37.07 (Executive Budget Act).

Sec. 41.41.110. Audits.

The Legislative Budget and Audit Committee may provide for an annual post audit and annual operational and performance evaluations of the authority's operations and budget.

Sec. 41.41.120. Reports and publications.

(a) By September 30 of each year, the board shall publish a report of the authority for distribution to the governor and the public. The board shall notify the legislature that the report is available.

(b) The report must include financial statements audited by independent outside auditors and a statement of the amount of money received by the authority from its operations during the period covered.

Sec. 41.41.130. Tax exemption.

The security instruments issued by the authority, the transfer of the security instruments, and the income on the security instruments are exempt from all taxes and assessments in the state.

Sec. 41.41.140. Political activities.

The resources of the authority may not be used to finance or influence political activities.

Sec 41.41.150. Public access to information.

(a) Information in the possession of the authority is a public record, except that information that discloses the particulars of the business or affairs of a private enterprise or investor is confidential and is not a public record for purposes of AS 40.25.110 - 40.25.140. Confidential information may be disclosed only for the purposes of an official law enforcement investigation or when its production is required in a court proceeding.

(b) The restrictions of (a) of this section do not prohibit the publication of statistics presented in a manner that prevents the identification of particular reports, items, persons, or enterprises.
Article 2. Powers of the Authority.

Sec. 41.41.200. Powers of the authority.

In furtherance of its corporate purposes, in addition to its other powers, the authority may
1. sue and be sued;
2. adopt a seal;
3. adopt, amend, and repeal bylaws and regulations;
4. make and execute contracts and other instruments;
5. in its own name acquire property, lease, rent, convey, or acquire real and personal property; a project site or part of a project site may be acquired by eminent domain;
6. acquire natural gas supplies;
7. issue bonds and otherwise incur indebtedness in accordance with AS 41.41.300 - 41.41.410 in order to pay the cost of a project;
8. accept gifts, grants, or loans from and enter into contracts or other transactions regarding gifts, grants, or loans with a federal agency or an agency or instrumentality of the state, a municipality, private organization, or other source;
9. enter into contracts or agreements with a federal agency, agency or instrumentality of the state, municipality, or public or private individual or entity, with respect to the exercise of its powers;
10. charge fees or other forms of remuneration for the use of authority properties and facilities;
11. defend and indemnify a current or former member of the board or an employee or agent of the authority against the costs, expenses, judgments, and liabilities as a result of actions taken in good faith on behalf of the authority; and
12. purchase insurance to protect its assets, services, and employees against liabilities that may arise from authority operations and activities.

Article 3. Revenue Bonds and Notes.

Sec. 41.41.300. Bonds and notes of the authority.

(a) The authority, by resolution, may issue revenue bonds and bond anticipation notes in order to provide funds to carry out the purposes set out in AS 41.41.010(a).

(b) The principal and interest on the revenue bonds or notes authorized and issued under (a) of this section are payable from authority funds. Bond anticipation notes may be payable from the proceeds of the sale of bonds or from the proceeds of the sale of other bond anticipation notes or, in the event bond or bond anticipation note proceeds are not available, the notes may be paid from other funds or assets of the authority.

(c) Bonds or notes may be additionally secured by a pledge of a grant or contribution from the federal government, or a corporation, association, institution, or person, or a pledge of money, income, or revenues of the authority from any source.

(d) Bonds or bond anticipation notes of the authority may be issued in one or more series and shall be dated, bear interest at the rate or rates per year or within the maximum rate, be in the denomination, be in the form, either coupon or registered, carry the conversion or registration provisions, have the rank or priority, be executed in the manner and form, be payable at the times, from the sources, and in the medium of payment and place or places within or outside the state, be subject to authentication by a trustee or fiscal agent, and be subject to the terms of redemption with or without premium, as the resolution of the authority may provide. Bond anticipation notes shall mature at the time or times that are determined by the authority. Bonds shall mature at a time not exceeding a number of years from their date that is determined by the authority. Before the preparation of definitive bonds or bond anticipation notes, the authority may issue interim receipts or temporary bonds or bond anticipation notes, with or without coupons, exchangeable for bonds or bond anticipation notes when these definitive bonds or bond anticipation notes have been executed and are available for delivery.

(e) Bonds or bond anticipation notes may be sold in the manner and on the terms the authority determines.

(f) If an officer whose signature or a facsimile of whose signature appears on a bond, note, or coupon attached to them ceases to be an officer before the delivery of the bond, note, or coupon, the signature or facsimile is valid to the same extent as if the officer had remained in office until delivery.

Sec. 41.41.310. Covenants.

In a resolution of the authority authorizing or relating to the issuance of bonds or bond anticipation notes, the authority has power by provisions in the resolution that will constitute covenants of the authority and contracts with the holders of the bonds or bond anticipation notes to

1. pledge to a payment or purpose all or a part of its revenues to which its right then exists or may thereafter come into existence, and the money derived from the revenues, and the proceeds of bonds or notes;
2. covenant as to the use and disposition of payments of principal or interest received by the authority on loans or other investments held by the authority;
3. covenant as to establishment of reserves or sinking funds and the making of provision for and the regulation and disposition of the reserves or sinking funds;
4. covenant with respect to or against limitations on a right to sell or otherwise dispose of property of any kind;
5. covenant as to bonds and notes to be issued, and their limitations, terms, and conditions, and as to the custody, application, and disposition of the proceeds of the bonds and notes;
6. covenant as to the issuance of additional bonds or notes, or as to limitations on the issuance of additional bonds or notes and the incurring of other debts;
7. covenant as to the payment of the principal of or interest on the bonds or notes, as to the sources and methods of the payment, as to the rank or priority of the bonds or notes with respect to a lien or security, or as to the acceleration of the maturity of the bonds or notes;
8. for the replacement of lost, stolen, destroyed, or mutilated bonds or notes;
9. covenant as to the redemption of bonds or notes and privileges of their exchange for other bonds or notes of the authority;
10. covenant to create or authorize the creation of special funds of money to be held in pledge or otherwise for operating expenses, payment or redemption of bonds or notes, reserves, or other purposes;
11. establish the procedure, if any, by which the terms of a contract or covenant with or for the benefit of the holders of bonds or notes may be amended or abrogated, the amount of bonds or notes the holders of which must consent to amendment or abrogation, and the manner in which the consent may be given;
12. covenant as to the custody of property or investments, their safekeeping and insurance, and the use and disposition of insurance money;
13. agree with a corporate trustee that may be a trust company or bank having the powers of a trust company within or outside the state as to the pledging or assigning of revenue or funds to which or in which the authority has rights or an interest; the agreement may further provide for other rights and remedies exercisable by the trustee as may be proper for the protection of the holders of a bond or note of the authority and not otherwise in violation of law and may provide for the restriction of the rights of an individual holder of bonds or notes of the authority;
14. appoint and provide for the duties and obligations of a paying agent or paying agents or other fiduciaries as the resolution may provide within or outside the state;
15. limit the rights of the holders of a bond or note to enforce a pledge or covenant securing the bonds or notes;
16. make covenants other than and in addition to the covenants expressly authorized in this section of like or different character, and to make covenants to do or refrain from doing acts and things as may be necessary or convenient and desirable in order to better secure bonds or notes or that, in the absolute discretion of the authority, will tend to make bonds or notes more marketable, notwithstanding that the covenants, acts, or things may not be enumerated in this section.

Sec. 41.41.320. Limitations of issuance of bonds.

(a) The authority may not issue bonds in an amount that exceeds the amount of bonds authorized to be issued by the legislature.

(b) This section does not apply to the issuance by the authority of refunding bonds or to the issuance by the authority of bonds the proceeds of which are intended to be used to refinance the loans held by the authority.

Sec. 41.41.330. Independent financial advisor.

In negotiating the private sale of bonds or bond anticipation notes to an underwriter, the authority may retain a financial advisor. A financial advisor retained under this section must be independent from the underwriter.

Sec. 41.41.340. Validity of pledge.

(a) The pledge of assets or revenue of the authority to the payment of the principal or interest on an obligation of the authority is valid and binding from the time the pledge is made, and the assets or revenue become immediately subject to the lien of the pledge without physical delivery or further act. The lien of a pledge is valid and binding against all parties having claims in tort, contract, or otherwise against the authority, irrespective of whether those parties have notice of the lien of the pledge.

(b) This section does not prohibit the authority from selling assets subject to a pledge, except that a sale may be restricted by the trust agreement or resolution providing for the issuance of the obligations.

Sec. 41.41.350. Capital reserve funds.

(a) For the purpose of securing one or more issues of its obligations, the authority may establish one or more special funds, called "capital reserve funds," and shall pay into those capital reserve funds

(1) money appropriated and made available by the state for the purpose of those funds,

(2) proceeds of the sale of its obligations, to the extent provided in the resolution or resolutions of the authority authorizing their issuance, and

(3) other money that may be made available to the authority for the purpose of those funds from another source. All money held in a capital reserve fund, except as provided in this section, shall, subject to appropriation, be used as required solely for the payment of the principal of obligations or of the sinking fund payments with respect to those obligations; the purchase or redemption of obligations; the payment of interest on obligations; or the payment of a redemption premium required to be paid when those obligations are redeemed before maturity. However, money in a fund may not be withdrawn from that fund at any time in an amount that would reduce the amount of that fund to less than the capital reserve requirement set out in (b) of this section, except for the purpose of making, with respect to those obligations, payment, when due, of principal, interest, redemption premiums, and the sinking fund payments for the payment of which other money of the authority is not available. Income or interest earned by, or increment to, a capital reserve fund due to the investment of the fund or other amounts in it may be transferred by the authority to other funds or accounts of the authority to the extent that the transfer does not reduce the amount of the capital reserve fund below the capital reserve fund requirement.

(b) If the authority decides to issue obligations secured by a capital reserve fund, the obligations may not be issued if the amount in the capital reserve fund is less than a percent, not exceeding 10 percent, of the principal amount of all of those obligations secured by that capital reserve fund then to be issued and then outstanding in accordance with their terms, as may be established by resolution of the authority, called the "capital reserve fund requirement," unless the authority, at the time of issuance of the obligations, deposits in the capital reserve fund from the proceeds of the obligations to be issued or from other sources an amount that, together with the amount then in the fund, will not be less than the capital reserve fund requirement.

(c) In computing the amount of a capital reserve fund for the purpose of this section, securities in which all or a portion of the funds are invested shall be valued at par or, if purchased at less than par, at amortized costs as the term is defined by resolution of the authority authorizing the issue of the obligations or by some other reasonable method established by the authority by resolution. Valuation on a particular date must include the amount of interest earned or accrued to that date.

(d) To assure the continued operation and solvency of the authority for the carrying out of its corporate purposes, provision is made in (a) of this section for the accumulation in capital reserve funds of an amount equal to their capital reserve fund requirement.

(e) The chair of the authority shall annually, not later than January 2, make and deliver to the governor and chairs of the house and senate finance committees a certificate stating the sum, if any, required to restore a capital reserve fund to the capital reserve fund requirement. The legislature may appropriate that sum, and all sums appropriated during the current fiscal year by the legislature for the restoration shall be deposited by the authority in the appropriate capital reserve fund.

(f) This section does not create a debt or liability of the state.

Sec. 41.41.360. Remedies.

A holder of obligations or coupons attached to them issued under the provisions of this chapter, and a trustee under a trust agreement or resolution authorizing the issuance of the obligations, except as restricted by a trust agreement or resolution, either at law or in equity, may enforce all rights granted hereunder or under the trust agreement or resolution, or under another contract executed by the authority under this chapter, and may enforce and compel the performance of all duties required by this chapter or by the trust agreement or resolution to be performed by the authority or by an officer of it.

Sec. 41.41.370. Negotiable instruments.

All obligations and interest coupons attached to them are negotiable instruments under the laws of this state, subject only to applicable provisions for registration.

Sec. 41.41.380. Obligations eligible for investment.

Obligations issued under the provisions of this chapter are securities in which all public officers and public bodies of the state and its political subdivisions, all insurance companies, trust companies, banking associations, investment companies, executors, administrators, trustees, and other fiduciaries may properly and legally invest funds, including capital in their control or belonging to them. These obligations may be deposited with a state or municipal officer of an agency or political subdivision of the state for a purpose for which the deposit of bonds, notes, or obligations of the state is authorized by law.

Sec. 41.41.390. Refunding bonds.

(a) The authority may provide for the issuance of refunding bonds for the purpose of refunding an obligation then outstanding that has been issued under the provisions of this chapter, including the payment of redemption premium on them and interest accrued or to accrue to the date of redemption of the obligations. The issuance of the bonds, the maturities and other details of them, the rights of the holders of them, and the rights, duties, and obligations of the authority in respect of them are governed by the provisions of this chapter that relate to the issuance of obligations insofar as those provisions may be appropriate.

(b) Refunding bonds may be sold or exchanged for outstanding bonds issued under this chapter, and, if sold, the proceeds may be applied, subject to appropriation and in addition to another authorized purpose, to the purchase, redemption, or payment of the outstanding obligations. Pending the application of the proceeds of refunding bonds, with any other available funds, to the payment of the principal, accrued interest, and redemption premium on the obligations being refunded, and, if so provided or permitted in the resolution authorizing the issuance of the refunding bonds or in the trust agreement securing them, to the payment of any interest on the refunding bonds and expenses in connection with the refunding, the proceeds may be invested in direct obligations of, or obligations the principal of and the interest on which are unconditionally guaranteed by, the United States that mature or that will be subject to redemption, at the option of the holders of them, not later than the respective dates when the proceeds, together with the interest accruing on them, will be required for the purposes intended.

Sec. 41.41.400. Credit of state not pledged.

(a) Obligations issued under the provisions of this chapter do not constitute a debt, liability, or obligation of the state or of a political subdivision of the state or a pledge of the faith and credit of the state or of a political subdivision of the state but are payable solely from the revenue or assets of the authority. Each obligation issued under this chapter must contain on its face a statement that the authority is not obligated to pay it or the interest on it except from the revenue or assets of the authority and that neither the faith and credit not the taxing power of the state or of a political subdivision of the state is pledged to the payment of the principal of or the interest on the obligation.

(b) Expenses incurred by the authority in carrying out the provisions of this chapter are payable from funds provided under this chapter, and liability may not be incurred by the authority in excess of these funds.

Sec. 41.41.410. Officers not liable.

A member or other officer of the authority is not subject to personal liability or accountability by reason of having executed or issued an obligation.

Article 4. Property of the Authority.

Sec. 41.41.450. Property of the authority.

The authority may acquire, by purchase, lease, or gift, upon terms that it considers proper, land, structures, real or personal property rights, rights-of-way, franchises, easements, and other interests in land it considers necessary or convenient for the financing of the project or a part of the project.

Article 5. Project Construction.

Sec. 41.41.500. Contract terms relating to use of Alaska resources.

(a) The authority shall enter into one or more prehire project term agreements with labor organizations that

(1) contain no-strike clauses; and

(2) secure timely completion of the project and maximum employment opportunities for state residents.

(b) To maximize the economic benefits of the project to Alaskan businesses, the authority shall use Alaska contractors and suppliers to the maximum extent possible to take advantage of the Alaska experience in Arctic engineering and construction.

Article 6. General Provisions.

Sec. 41.41.900. Tax exemption. All obligations issued under this chapter are declared to be issued by a body corporate and public of the state and for an essential public and governmental purpose, and the obligations, and the interest and income on and from the obligations, and all fees, charges, funds, revenues, income, and other money pledged or available to pay or secure the payment of the obligations, or interest on the obligations, are exempt from state taxation except for transfer, inheritance, and estate taxes.

Sec. 41.41.990. Definitions. In this chapter,
1. "authority" means the Alaska Natural Gas Development Authority;
2. "board" means the board of directors of the Alaska Natural Gas Development Authority;
3. "project" means the gas transmission pipeline, together with all related property and facilities, to extend from the Prudhoe Bay area on the North Slope of Alaska to tidewater at a point on Prince William Sound and the spur line from Glennallen to the Southcentral gas distribution grid, and includes planning, design, and construction of the pipeline and facilities as described in AS 41.41.010(a)(1) - (5).

*Sec. 3. AS 39.25.110(11) is amended by adding a new subparagraph to read:
(G) Alaska Natural Gas Development Authority;

*Sec. 4. AS 39.50.200(b) is amended by adding a new paragraph to read:
(57) the board of directors and chief executive officer of the Alaska Natural Gas Development Authority (AS 41.41.020).

*Sec. 5. The uncodified law of the State of Alaska is amended by adding a new section to read:
DEVELOPMENT OF PROJECT PLAN. Not later than one year after the first meeting of the board of directors of the Alaska Natural Gas Development Authority, the board shall produce a development plan. The development plan must include
1. estimates of construction costs and timelines;
2. gas procurement prices;
3. use of the state's royalty gas;
4. estimates of revenue to the general fund and the Alaska permanent fund;
5. a revenue sharing plan with municipal governments;
6. a plan for delivery and pricing of natural gas to communities along the pipeline route and to Southcentral Alaska through a spur line;
7. a plan for delivery and pricing of LNG to Yukon River and coastal communities;
8. a payment schedule to companies providing permits or other valuable assets;
9. a marketing plan to approach potential buyers;
10. a plan to maximize Alaskan hire, including project labor agreements; and
11. a plan to ensure meeting the highest environmental and safety standards, including a citizens advisory council.
12. The goal of the authority is to have the Alaskan gas line in full production by 2007.

*Sec. 6. The uncodified law of the State of Alaska is amended by adding a new section to read:
INITIAL APPOINTMENTS OF MEMBERS OF ALASKA NATURAL GAS DEVELOPMENT AUTHORITY BOARD OF DIRECTORS. Of the members first appointed under AS 41.41.020(a), enacted by sec. 2 of this Act,
1. three members shall be appointed to three-year terms;
2. two members shall be appointed to two-year terms; and
3. two members shall be appointed to one-year terms.

Parnell is having fun as Gov

(One has to wonder why Todd is laughing during Parnell's swearing in ceremony. Could it be that it is because Sarah is off the hook and into the money?)

Gov. Sean Parnell is having more fun as governor than the proverbial fly on fly paper.
First, Parnell’s Gas Pipeline Czar, Harry Noah—see, Obama’s not the only one with Czars, but then this was Sarah’s appointment, Parnell just went with what was there—decreed that the cheapest construction for a natural gas bullet line to south central was down the Parks Highway. What was not disclosed was the cost of the gas at the delivery end. 500 mcf per day stand alone will carry a hefty price tag by the time it gets to Anchorage. The portent in this is what? An admission that any construction on any big pipe project will not come soon enough, or not at all?
Parnell went to D.C. to lobby for off shore drilling. This effort failed in the face of Obama’s BLM Secretary, Salazar, deciding, nah, we don’t need no stinkin’ offshore drilling! Screw any rational energy policy! Let them ride bicycles! No fault of Parnell’s. At least he tried. Loss to Alaska, around $100,000,000 in services and labor to the effort by Shell and others. Shell had previously abandoned its offshore plans in the face of a hostile resource development federal administration.

Parnell is also lobbying Congress against a bill that would bar aerial predator control. A stupid, shortsighted bill on the part of politicians who do not understand Alaska and the needs of her people.

Try paying $11 for a quart of milk, sometime. That’s the Bush cost because Alaska cannot build roads to connect our communities. ANILCA. Gee thanks, Pres. Carter.
I wonder if the feds want Alaska back? I mean, thus far, they have taken away our management of all lands and offshore as granted in the Statehood Compact, imposed new land use restrictions under ANILCA and now the offshore drilling restrictions, and refusing to allow drilling onshore or offshore of ANWR.
Congress recognized that providing Alaska the infrastructure that the rest of the State’s enjoyed in 1958 would break any future federal treasury several times over. That’s why the Congress gave Alaska a 90% royalty off of all mineral and hydrocarbon development. Oh, wait, Congress reneged on that with the Petroleum Reserve 4 lease sale in the late 1990s. What Statehood Compact?

Palin is now a foreign policy expert . . .

In a speech in Hong Kong on 23 September, former Governor Sarah Palin railed against the Obama Administration's policies. CBS news on KFQD this morning reported that Palin now has her foreign policy credentials!
Gee, someone at CBS either has a sense of humor, or a very low expectation of what comprises “foreign policy” credentials . . . well, then again, these guys backed Obama. . . .

Thursday, September 17, 2009

Sarah’s Sovereignty Sound Bite

In a World Net Daily article, Bob Unruh gave Sarah Palin a lot of credit that is undeserved where any defense of the 10th Amendment is concerned. Sarah's sound bite that HJR 27 is so much hot air.

Alaska HJR 27:

“Be it resolved that the Alaska State Legislature hereby claims sovereignty for the state under the Tenth Amendment to the Constitution of the United States over all powers not otherwise enumerated and granted to the federal government by the Constitution of the United States.
Be it further resolved that this resolution serves as Notice and Demand to the federal government to cease and desist, effective immediately, mandates that are beyond the scope of these constitutionally delegated powers.”
Last year, and after her selection as the Republican Vice President candidate, Alaska’s Governor Sarah Palin signed HJR 27. HJR 27 is a good start, but drops the round short of actually giving the federal government notice by law. A resolution does not carry the weight of law. It is merely a showing of intent. Nice PR ploy, but specious, except as a Palin sound bite.
Alaska has law on the books that give the federal government notice of who does what and who manages what on Alaska lands. Alaska’s Statehood Compact is our law, and we also have that law expressed under statute long before Sarah Palin came upon the State political radar.
AS 38.05.500
“The people of the State of Alaska determine that:
(1) the intent of the framers of the Constitution of the United States was to guarantee to each of the states sovereignty over all matters within its boundaries except for those powers specifically granted to the United States as agent of the states;
(2) the attempted imposition upon the State of Alaska by the Congress of the United States of a requirement in the Statehood Act that the State of Alaska and its people "disclaim all right and title to any land or other property not granted or confirmed to the state or its political subdivisions by or under the authority of this Act, the right or title to which is held by the United States or is subject to disposition by the United States," as a condition precedent to acceptance of Alaska into the Union, was an act beyond the power of the Congress of the United States and is thus void;
(3) the purported right of ownership and control of the public land in the State of Alaska by the United States is without foundation and violates the clear intent of the Constitution of the United States; and
(4) the exercise of that dominion and control of the public land in the State of Alaska by the United States works a severe, continuous and debilitating hardship upon the people of the State of Alaska.”
With AS 38.05.500-505 on the books as statutes, not resolutions, why has no governor since Wally Hickel bothered to enforce the State’s rights and act to limit federal imposition and the breech of our Statehood Compact that is ANILCA and the federal management of fish and game on federal lands?
AS 38.05.501:
“(a) The state has exclusive jurisdiction to enforce the provisions of AS 38.05.500 - 38.05.505.
(b) An individual may institute a civil action to recover damages for injury or loss sustained as the result of a violation of the provisions of AS 38.05.500 - 38.05.505 or for the failure of the state to enforce its trust responsibilities to the people of the state.”
With ANICLA, the federal government under Pres. Carter effectively demonstrated contempt for Alaska’s Statehood Compact.
The reality is, that Alaska has not challenged the federal management in court since the last term of Governor Hickel, something Sara Palin was supposed to do and did not. She left a lot hanging that she promised.
Sarah campaigned as the governor to challenge the feds and to pursue restoration of Alaska’s rights under the Statehood Compact. Her record as governor is one of mediocrity.
Sarah has a nice sound bite for her money machine in HJR 27.
Sarah Palin promised to challenge the feds over Alaska’s rights to manage Alaska lands granted by Congress under the Statehood Compact, including ANILCA provisions barring the State from executing rights of way across ANILCA lands.
Where is the substance in our former Governor’s performance as governor of Alaska? What did she do that OUTSIDERS, who have no real idea of her performance, rant and howl in rage over any legitimate criticism of this woman?
What is it? That Sarah is a pretty face? That she has a nice ass? Looks good in red? Speaks the right words? What?
Sarah is a sound bite, not a leader, and she is raking in the bucks off your backs, when the money needs to go to real Republican candidates in congressional races all over the U.S. Not to RINOs like Sarah.
Yes, I still like to listen to Sarah speak out. She says all the right things to push our buttons. That and her resignation from the Alaska Oil and Gas Commission is what sold me on her and gave me reason to hope for Alaska. Unfortunately, the reality of Sarah Palin is something else.
Look at her record. Look at who she appointed as her commissioners. Look at what she said versus what was done. The record speaks for itself. Sarah abandoned the ship, and Parnell is the guy who will be tried at the polls in 2010 for running the State’s economy aground.

Sunday, September 13, 2009

The March On Washington

God bless those who took place on the march on D.C. Saturday.
Maybe, the point was taken, maybe not.
People are tired of the unbridled growth of government at every level, not just at the federal level.
This was a demonstration of American constraint.
Unlike a demonstration for homosexual "rights"--ne we want to be another protected class so that we can get even with those who offend us--there was no nudity, or affronts to sensibility, morality, Christianity or the American family.
Unlike lib demonstrations, there was no screaming epitaphs against the opposition, no hate speech, and no physical confrontations.
I am hoping that these people will remember why they went to Washington, D.C. and that those of us who could not remember why those who went did so, and vote accordingly.
Vote the bums out, all of them.
It is time, Congress was refreshed with new minds who understand that the Constitution is the law, not an inconvenient set of rules made to be broken.
Same for the Whitehouse in 2012.

Monday, September 7, 2009

Palin got out while the getting was good and left Parnell holding the bag

The most recent issue of the Petroleum News had a dismal fact to convey: 2019 is the earliest any construction on any big pipe project for Alaska Natural gas could begin. Construction would begin even later if the Open Season next year for AGIA is a bust.

The interesting thing here is this is getting into the 2025 time frame Exxon was promoting during the Murkowski Administration.

Worse, the Alaska Journal of Commerce is now reporting that the earliest date projected for a start of construction for any bullet natural gas line from the North Slope or for any spur line off either of the big pipe projects (AGIA or Denali) is estimated at 2018-2020.

Alaska is so screwed. South central will be out of natural gas sometime from 2012-2014.

As previously reported by moi (Miss Piggy speech), south central Alaska will probably suffer rolling blackouts this coming winter during the coldest months due to a shortage of natural gas supplies from Cook Inlet fields.

Now we know why Sarah Palin got out of the Governor’s hot seat and chose to go for the money. Sarah could see the handwriting on the wall. While she is off making 6 figure speaking fees, we Alaskans will be sitting in the cold and dark during rolling blackouts this coming winter from a lack of natural gas and storage for that gas in south central Alaska.

Sarah, of course, from her tropical local for latest speech at the time, will commiserate with we poor Alaskans and say “hang in there, Alaskans are tough and a little cold just builds character!”

Gov. Sean Parnell on the other hand is now left holding the bag. He will become the target of frustration and anger on the part those Alaskans whose character will be improved by the interruption of heat and lights during the coming rolling blackouts. Of course, Parnell can always have Lt. Gov. Craig Campbell fly him in the Gov’s King Air 350 to warmer climes for ‘conferences’ with Palin on energy issues.

Parnell is not helping one bit to find a timely solution to the impass with the oil companies regarding delivery of North Slope stranded natural gas to market. Parnell has decided that he will await a time when Exxon, Conoco-Phillips and British Petroleum Alaska can come together on a unified pipeline project before the State of Alaska will consider negotiating the fiscal certainty the producers on the North Slope have stated all along that was necessary to the financing of any major pipeline project. In the mean time, we face rolling blackouts.

The trees are already shedding their leaves where I live. This winter is going to be colder than last, as that has been the trend over the last several years. Meanwhile, Sean is holding tough against the big, bad oil companies, while I may be forced to read by candle light during the coldest part of this winter.


Bet we see a bunch of taillights headed back Outside next Spring!

Alaska’s economy is going to tank, folks. Our Legislature and not less than the last three including latest, making it four governors have failed us.

Welcome to Alaska, where either Congress screws us with ANILCA, or our own governors and Legislatures allow the rape and run of our resources, and then dig in on negotiating a solution to our stranded North Slope gas.

Alaska where our leaders “hear no coming gas shortage, can’t see in a rolling blackout, and head south when it gets cold and the lights go out.”

We are so screwed.

Saturday, September 5, 2009

Parnell and Alaska's Sovereignty

Maintaining the sovereignty of Alaska in the face of increasing federal encroachment upon State’s Rights is the paramount mission of the Governor. Any federal regulation, law, or edict needs to be strictly reviewed by Gov. Sean Parnell’s Administration with respect to the duties of the federal government under the Constitution of the United States and with respect to the 10th Amendment.

Alaska is not like the lower-48 States. We are isolated geographically from the United States. Unlike Hawaii, Puerto Rico and the other territories of the U.S., notably Guam and American Samoa and the U.S. Virgin Islands, Alaska is not in a temperate climate. Alaska is also at the end of the logistics highway in priorities of any sort, other than locking up our land to please some moron Outside who believes that a lungful of mosquitoes or no-see-ums is preferable to the specter of Alaskans being able to drive to Nome.

Alaska’s lands are locked up. The last land transfer to the Feds was in their favor by over 1,900 acres so that a road could be built between the communities of Cold Bay and Kings Cove. A long standing and very expensive situation that could have been resolved many years ago, but the liberals would rather people die than have access overland by improving an existing trail that predated a federally mandated wildlife refuge. A solution that would have cost maybe a couple of hundred thousand dollars. The trail was passable by 2 wheel drive pickup in the summer and 4 wheeler year round. Instead, the feds built a $30,000,000 clinic in Kings Cove.

Unfortunately, that did not resolve the problem. Some folks just became too ill and had to be medivaced by air to Anchorage. The problem was that even the Untied States Coast Guard, with its HH60 Huskies, would not fly into Kings Cove. The weather made flying in with these state of the art rescue helicopters too dangerous. Nearby (14 miles) Cold Bay had an all weather runway that could accommodate jets. The only alternative was to move the patient to Cold Bay by boat.

After many years of bureaucratic haggling, tens of millions of dollars wasted, the federal government finally agreed to allow a corridor through the edge of the wildlife refuge using the existing trail. The cost to the State of Alaska for this was over 2,000 acres and tens of years of controversy and hardship for those in Kings Cove needing medical evacuation over 14 acres of incursion upon the wildlife refuge, as most of the trail is outside of the refuge.

Land transfers from the long ago Alaska Native Settlement Claims Act (ANSCA) take many years to accomplish, many of which have yet to be resolved. Affecting this seemingly never ending process is the Alaska National Interest Lands Act (ANILCA).

ANILCA lands were overlaid between ANSCA lands and nearby villages, making it impossible for the village corporations to exercise development of their lands. Costly land transfers had to be effected, some of which are still being worked on yet today. Usually, these land transfers are in the feds favor.

ANILCA lands also stand astride many passes in Alaska, making construction of overland roads impossible. Under ANILCA, motorized transport of any kind is prohibited, except for those Natives living on lands adjacent to ANILCA lands. Modifications to ANILCA allowed them to hunt using motorized vehicles.

ANILCA is so restrictive otherwise, that no rights of way for the State were provided for to build any roads through ANILCA lands to connect communities in the State. Even RS 2744 rights of way are meaningless if they cross ANILCA lands. Lose an engine on your airplane and be forced to put wheels down or floats down on ANILCA lands or waters, and you can lose the aircraft to the feds.

ANILCA, enacted during the Carter Administration, have constituted a major impediment to Alaska being able to do what other States have done in developing a rational surface transportation infrastructure. Alaska, because of ANILCA and the federal government taking over management of federal lands, contrary to the Alaska Statehood Compact, is not equal in the Union of States.

I thought our former Governor Sarah Palin would address this issue. She promised that she would fight the unfairness contained in ANILCA. Instead, she formed the Climate Change Sub-Cabinet now managed by a federal EPA employee. Something Gov. Sean Parnell has decided to continue.

Rep. Harry Crawford (D-Anchorage), who announced his intent to run for the U.S. Congress against Rep. Don Young (R), says that ANILCA is established law and precedent. Of course, Rep. Crawford is from Louisiana. Crawford came to Alaska for the Trans Alaska Pipeline construction in 1975. While he may think he is an Alaskan, he is far from it, given his views on ANILCA.

Rep. Young may have aspersions cast upon him from the Dems, he is still Alaska’s best voice and only voice in the congressional House.

The additional restrictions placed upon 190,000,000 acres of federal land by ANILCA are an affront to the sovereignty and dignity of the State of Alaska. ANILCA is a breach of our Statehood Compact.

It is time Alaska, given its recent resolution regarding sovereignty under the 10th Amendment, challenge the restrictions under ANILCA regarding rights of way and the impediments imposed to the development of the State.

Governor Parnell needs to take the bull in Washington by the horns and either gut the sucker, or throw it out of the way so that Alaska can get on with the business of connecting our communities overland, and accessing the resources Congress recognized were necessary to the development of the State in the Statehood Compact.
---CORRECTION MADE 9/14/2009 Cold Bay, not Icy Bay. As many times as I have harped on that situation, one would think that I would get it right.

Friday, September 4, 2009

Parnell and coming Alaska Recession

Alaska has thus far avoided the immediacy of the impact of the recession arising from the outrageous mismanagement of our financial sector. The reason for this is that most of the money in this State from oil revenues goes to the State, and then is trickled down to the communities through welfare and public works projects. A process where the governor and the Legislature compete for dwindling funds to promote their respective reelections through oil revenue largess to their constituency.

In his endorsement of offshore drilling, Gov. Sean Parnell mentioned that he wanted the ‘billions’ in wages and services for Alaska’s economy that would be generated by private sector companies which would be supporting companies like Shell in pursuing offshore oil and gas deposits. This is a radical departure from the ‘it must all come to the State first’ approach of the post TAPS construction era: 1978-present.

The question during the Jay Hammond Administration was ‘how best to benefit Alaskans from the oil wealth from the royalties and taxes’ on the North Slope development. It was decided that to give Alaskans the most benefit, the mechanism of a Permanent Fund was created. This fund was to accomplish two goals. One was to distribute a benefit to Alaskans from the oil wealth through the mechanism of the earnings of the Permanent Fund through a dividend program paid out yearly based upon a percentage of the earnings of the Permanent Fund. The Permanent Fund itself was established to provide for a time when revenues from oil production fell to such a level that State and local government would need help in meeting services. The PF was a rainy day fund.

The revenues that did not go into the Permanent Fund were used to fuel a State government that quickly demonstrated that it was incapable of restraining itself when it came to overspending. This tendency was adopted by local governments.

Former Gov. Jay Hammond and the Legislature at the time never intended for the Permanent Fund Dividend checks to individual Alaskans to go on forever. It was intended that the program would be terminated when revenue from oil fell to such a level that ending the PFD program would be necessary. The alternative was to tax the PFD so that government gave and then recouped that benefit through taxes.

Since Hammond’s administration in the late 1970s, the largess from oil revenues fuel a growth of State and local government that is unparalleled elsewhere, given the low population of the State of Alaska—approximately 650,000.

With this program, revenues were no longer generated at the local level; everything came from the State to the communities. This new super welfare state mentality soon extended itself beyond oil and gas into the mining sector.

The Mining Law of 1872 provided for a requirement for $200 in development and exploration to be accomplished on the mining claims, state or federal, each year. Congress and the State amended the law in the mid-1980s to allow a payment per acre in lieu of the development work. The $200 was something spent directly to the benefit of many Alaska communities for services and labor. Now, a company or individual with mining claims pays $2 per acre per year for each mining claim directly to the State without having to do anything as far as developing or “proving’ the claims as being viable. This has led to big companies coming into Alaska and simply claiming all around a promising prospect and eventually, through water rights issues, and other mechanisms freezing out the small claimholder.

Payment directly to the State bypassed the community benefit and is slowly eliminating the little guy in Alaska’s mining industry.

The picture is now of a State government from which all monies from resource development flows downward to the localities from the State. Yearly state budgets are upwards of $8 billion with federal sharing funds.

What are the indicators of any recession in Alaska?

For the last 5 years, residential and commercial construction have slowed by as much as 30% per year for new construction starts.

Alaska’s entry into the recession has been relatively slow compared to other States, because of our oil revenues. Oil production is declining, however, and sooner or later even high oil prices will not produce the revenue that was once enjoyed by the State government from North Slope oil development.

Parnell’s speaking of direct benefits from wages and business reflects an awareness of the potential impact of oil and gas offshore exploration and development to Alaska’s economy and communities. Obviously, the communities closest to the development will benefit the most. It is these Alaska coastal communities that are in need of such development. One only has to look to Kotzebue and its relationship with the Red Dog mine to see potential benefit.

It is even possible that Alaska might see a rise in oil field support businesses to support increased oil and gas exploration offshore. This gives Alaska the opportunity to benefit in much the same manner as have the western Canadian provinces from the oil and gas development there. Alaska would be in the position to redevelop a bottom up economy, reducing the focus on the current top down, mother state.

What is it that can accelerate Alaska’s descent into an economic depression, the likes of which has not been seen since the post TAPS construction ended? Alaska’s tax structure on the oil industry.

With the completion of TAPS back in late 1977, people working on the project left. Property values plummeted. Unemployment in the Matanuska Valley where I grew up peaked at 26%.

Most of our Legislators are post that experience and lack the perspective that those of us where there and experienced this time possess. Hence, they act as if there is not derogative to Alaska’s economy with their oil and gas tax policies.

The harbinger of what’s to come is British Petroleum’s very recent announcement of serious cutbacks on the North Slope amounting to a major slow down of activity for this company. It has reported that the decrease in spending by BP is going to be $100,000,000 or greater this year. BP has given notice to its subcontractors that they will have to reduce their contract costs or risk losing their work.

Gov. Sean Parnell needs to change the paradigm of taxing the oil companies in Alaska, if there is to be any real “black gold rush” for Alaska’s offshore potential. To do that, he needs to give the Legislature a reality check that the good old days of 1.2 million barrels per day flowing down the Trans Alaska Pipeline to market are gone forever if something does not change and change quickly.

Parnell has the lesson to be learned from Albert, Saskatchewan, and British Columbia with respect to envigorating Alaska’s oil and gas development.

Parnell has a valuable tool in the Alaska Natural Gas Development Authority. Hopefully, he will not let his predecessor’s rhetoric and open hostility towards the oil companies in Alaska guide his policy decision. Otherwise, Alaska’s economy will “tank” and make post TAPS look like a picnic by comparison.

Thursday, September 3, 2009

Shell and Sean Parnell--oil and gas development offshore

Governor Sean Parnell announced today that his administration will seek to expand oil and gas exploration and development offshore on Alaska’s coastal continental shelf.

This announcement follows the August 28th 9th Circuit Court of Appeals’ decision that the 2007 oil and gas lease sale in the Beaufort Sea did not violate environmental laws.

In testimony given on August 20th to Sen. Lisa Murkowski, Gov. Parnell outlined areas in which Alaska can play a major role in helping the U.S. obtain energy independence and security for Arctic resources. I’ve included the text of his testimony to the Senator.

Thank you, Senator Murkowski, for this opportunity to address the Homeland Security Subcommittee of the Senate Appropriations Committee on one of the greatest challenges facing the Nation and the State of Alaska – the changing Arctic and the national policies necessary for its understanding, its protection, and its responsible development.
Before I begin my remarks, Madam Chair, I would like to take a few moments to recognize and thank Admiral Thad Allen, Commandant of the United States Coast Guard, and all the members of the Coast Guard for their bravery and hard work in Alaska.
Just this week, the Coast Guard helped save the lives of nine people in Alaska. A Coast Guard helicopter found two missing adults and a child near Ketchikan. With help from Alaska State Troopers, family and friends, the Coast Guard rescued another six people when a 20-foot pleasure boat overturned at Tee Harbor near Juneau. Unfortunately, one person lost their life in that incident. My thoughts and prayers are with his family, and we deeply appreciate the men and women who keep America’s coastlines safe and secure.
As you know Senator Murkowski, Alaska is America’s Arctic – it’s our home, our history, our heritage, and our future. And Alaska is the only national link to the Arctic and the only state that shares a border with two other Arctic nations. Arctic policies affect every state and every citizen – Alaskans most of all, not just because of our strategic location on the globe, but because of what we have to offer. The Arctic’s abundant resources – human and natural – and our strategic location for national security demand our attention. The people of Alaska understand and eagerly accept our role in the examination and development of national Arctic policy.
We worked closely with the previous Administration on national and homeland security directives outlining broad policies on the Arctic. We hope to continue that collaboration with this Administration and Congress.
Today, I present Alaska’s view of U.S. Arctic policies in five areas: resources, national and homeland security, science, and foreign policy. In the Arctic, these policies are inextricably linked. And, while I describe these issues individually, it is vital that this committee and the Administration understand and act on them jointly. Domestic energy supplies support national and homeland security. Security enables development and protects the environment. Foreign policy enables international participation in scientific research. This must all be discussed in the context of climate change and how Alaska is adapting in light of Arctic policy.

Let me begin by focusing on Alaska’s resources – most of all, our human resources: Alaska’s people. Make no mistake, Alaskans have been adapting for years. Changes in the Arctic affect us directly, every day. No one is more vested in Arctic policy than the people who subsist from the land – hunting, fishing and gathering, not just for food, but for the survival of their culture. Collaboration with our Arctic residents and local governments is a must. Alaskans understand the need for balance.
Any conversation about the Arctic must also include Alaska’s natural resources – coal, gold, zinc, silver, copper, natural gas and oil. These resources make the Arctic vital to American energy security. Alaska is America’s Arctic energy breadbasket. We have traditional and renewable sources of energy in staggering volumes here. Alaska can play an even greater role in reducing the amount of oil and gas we import from abroad. And we can be America’s test-bed for renewable and alternative energy sources.
The onshore Arctic areas, such as the NPR-A and the coastal plain of ANWR, hold great promise.
Alaska is home to the Trans Alaska Pipeline System, which carries 685,000 barrels of oil a day to the lower 48 states. This major supply of oil is key to our national energy security.
Offshore Alaska … the Beaufort and Chukchi Seas can be explored safely in the near-term, producing oil and gas for decades. Without these known, traditional sources of energy, we risk higher cost energy, higher taxes, and greater dependence on foreign oil. We can do this on our own soil. Let us not be led down the easy path to investing America’s foreign aid dollars in exploration abroad. Let’s keep it here – where Americans can get the jobs, and where environmental laws safeguard our land, seas, and wildlife.
Putting the brakes on domestic energy production does not prevent global warming or end threats to species. Instead, delaying responsible exploration and development increases the problem by shifting resource extraction to less environmentally preferred fuels and locations.
Turning to cleaner fuels, the State of Alaska is also pursuing the construction of a pipeline to bring the North Slope's abundant, clean natural gas to American markets. We have two competing private sector groups working diligently to permit a natural gas pipeline that can deliver 4.5 billion cubic feet of natural gas a day to the continental United States. Again, if we can turn on the supply of clean, American natural gas – from Alaska – we will reduce our dependence on imports and bring less expensive energy to homes across America.
Unfortunately, current language in proposed climate change legislation would likely make the project uneconomic and would lead to the use of higher cost fuel sources before technology catches up.
Alaska remains fully committed to alternative and renewable energy, as well. This is the place to field test every alternative. From wind turbines to hydro-electric, to chip-fired systems that burn wood for fuel – Alaska is America’s alternative energy center.
I am confident that together we can bring traditional, renewable and alternative energy to market and increase Alaska’s contribution toward our nation’s energy independence for years to come.
Homeland Security Alaska is America’s Arctic Guardian. Our strategic location, resources and people compel strong funding for homeland security. The Department of Homeland Security and its agencies have been strong partners in providing for the safety and security of Alaskans and our economy.
Melting sea ice and increased military and commercial activity require a greater Coast Guard presence. The Coast Guard needs to move north and improve its capability — our heavy ice-class icebreakers are on their last legs. To provide homeland security the Coast Guard must have new Arctic-class icebreakers equipped for search and rescue missions, border protection, law enforcement, fisheries enforcement, infrastructure and environmental protection.

Support for funding for those icebreakers is up to this committee. We need to fund a new Coast Guard duty station or port on Alaska’s coast between Nome and Barrow to meet the new challenges of the Arctic.
The Coast Guard needs to keep the promise of the Oil Pollution Act of 1990 and establish a research program for the Arctic. With information in hand, we can continue to work with the Coast Guard to improve our ability to prevent and respond to oil spills in the region.
In addition, the Department of Homeland Security and the Federal Emergency Management Agency must have authority to act on disasters we can predict, not just those looming around the corner or the one we currently face. In western and northern Alaska, the sea ice no longer shields the coast from fall storms. The resulting erosion threatens the sustainability of some communities. The federal law was not written with such hazards in mind and does not provide the large-scale response these small communities need.
Exploration and development will bring more coastal and maritime infrastructure, such as ports, repair facilities, fuel depots, pipelines, and transportation. These assets will need effective, enforceable security buffer zones to ensure continuity under all hazards.
National Security As the summer ice retreats, opportunities for commerce, tourism and transportation advance. Already we see more mineral, oil and gas exploration – more vessel traffic and science missions. As we have seen throughout the world’s oceans, increased maritime traffic elevates both risks and threats. Currently, the North Slope Borough and oil and gas producers on the slope fill much of that void. We need the federal government to step in. We can no longer assume that the threat from the north to our oil production fields is not real. We can no longer assume that the Arctic is an impenetrable barrier.
The United States must increase national focus on the Arctic, add resources to collect scientific data, and increase Coast Guard presence to address these new challenges and opportunities. This will provide the ability to develop the American Arctic’s vast natural resources and is critical for the protection of strategic national infrastructure and assets.
Alaska’s strategic position as the northern crossroads also places us squarely in line between potential adversaries and the rest of the United States. I urge the Congress to support the ground-based missile defense system in Alaska and reconsider the proposal to scale back the placement of interceptors at Fort Greely. We play a critical role in national security and in the security of American allies.
Science Despite centuries of exploration and study, much about the Arctic remains a mystery. Standard weather and climate models are not sufficient for understanding and predicting trends and patterns. New models require fresh data and up-to-date research.
The State of Alaska strongly supports the National Oceanic and Atmospheric Administration and its initiatives to improve its observations and research across the Arctic and to develop innovative forecasting models for next week’s weather and next century’s climate.
I encourage scientific collaboration among the academic world, the Arctic nations, and non-governmental organizations to improve our understanding of fisheries, marine mammals, land animals and vegetation in the Arctic ecosystem. This research must be open and rigorous.
The State continues its support of the use of unmanned aerial systems for Arctic operations and research. The Alaska Aerospace Development Corporation and NOAA are working on a plan for how best to make that happen. The technology exists; the stakeholders are ready; but the current regulations are inflexible and outdated.
And the Arctic, literally, needs to be put on the map. Scientific research and economic exploration are set back by low-quality, decades-old mapping data. There is no accurate baseline to measure change, to

identify trends and patterns, or to predict potential outcomes. We need high-quality maps of the Arctic – both land and sea. Funding for such priorities should not be based on population density, but instead on current and future strategic economic and environmental values.
Foreign Policy For much of its history, the Arctic has been both ungoverned and ungovernable. Even as the eight Arctic nations have increased economic activity, the Arctic climate has impeded economic and social development, transportation, and research. That era must end.
I strongly urge the Senate to ratify the United Nations Convention on the Law of the Sea. Once ratified, the treaty will allow us to claim jurisdiction over the offshore continental shelf behind the 200-mile limit. U.S. boundaries could grow into areas that may hold large deposits of oil, natural gas and other resources. Russia, Canada, Denmark, and Norway have claims to Arctic territory under the auspices of the Law of the Sea. Without ratification, the U.S. cannot fully participate in adjudication of these claims.
Climate change Alaskans have extremely close ties to the land and the sea and are sensitive to their subtleties and variability. The changes in the Arctic ice – their timing, extent, and nature – give us cause for concern.
To define and address these concerns, Governor Palin formed the Climate Change Subcabinet to respond to immediate needs in rural villages, plan for the long term and determine research needs. The subcabinet has turned recommendation into action. We’re now working on coastline stabilization, emergency and evacuation planning, hazard mitigation planning, training and exercises for the communities most in need.
The climate change strategy is in the final stages and will be presented to me this fall. We’ve had noteworthy partnerships with several federal agencies in this process, and we look forward to continued work with the federal government as we address climate change.
Conclusion In conclusion, I applaud you, Senator Murkowski, on bringing to Alaska this hearing on the strategic importance of the Arctic in U.S. policy. These policies, whether long-standing or emerging, will have a profound effect on the nation and on Alaska for generations. We must take a balanced approach to protect our food sources, thousands of jobs and the energy security provided by Alaska’s oil and mineral development.
Alaska and the U.S. government share a policy that is balanced and recognizes the diversity the Arctic offers. And it highlights the Arctic’s unique characteristics and consequent need for unique treatment.
I urge the Congress and the federal Administration to continue the good work on Arctic policies and encourage the development of a National Arctic Doctrine that includes all stakeholders in the future of the Arctic. Alaska will participate and Alaska will contribute. We are eager to work with Congress to manage all our resources.
On taking office last month, I asked Alaskans and myself several questions: In the next 50 years, will Alaska move forward, or will time pass us by? Will each of us be a vital player, or will we stay on the bench? Will we just survive, or will we choose to thrive?
Today Alaskans join me in stating that our state – and our nation – must not be idle and passive; that we must not drift; that we must choose our destiny and work hard to achieve it.
The Arctic is our future. We choose to move forward, and we choose to thrive.
Thank you for your leadership and your service to our great State and to our Nation.

This is a good policy statement reflecting Alaska’s role in the energy future of the U.S. and emphasizing the importance of Alaska in the looming rush to the Arctic for resources by those nations bordering the Arctic. The request for a Coast Guard presence in Western Alaska is long overdue.

The Russians have been very aggressive over the last several years in establishing a military and geographical basis for their claims to resources under the Arctic Sea. It is imperative that the U.S. establish its claims and moves to develop off shore oil and gas opportunities before others do so.

Unfortunately, Parnell’s words will fall on deaf ears in Washington, as we have a President set on the path to appeasement and apology, and a Congress sold to the environmental lobby. I doubt there is anyone with a strategic vision in the Obama cabinet. Plenty of idealogues, but few with vision with respect to protecting the strategic interests of the U.S. in the Arctic.

I have written on Governor Palin’s Climate Change Strategy Sub-Cabinet before, and the fact that Parnell continues to give lip service to this waste of money, not to mention federal incursion into the State’s domain, is not good. However, in his favor, Parnell is in a situation of slowly divorcing himself from Sarah’s lack of governance. If he makes a break too soon, he admits to any potential competition for the governor’s job that the Palin Administration was a failed administration, and that he supported failure. As it is, there are now 4 candidates who have announced for governor. Unfortunately, Parnell will have to defend the previous administration before he can put his stamp on policies he can call his own. This testimony is a good start for his administration.

In announcing his administration’s support for offshore drilling, he will now endure the storm of the environmental lobby’s wrath, both in Juneau and in Washington. It will not be long before the ads start on TV and the radio decrying the damage to the environment.

BP just completed a 7 MILE (35,000 ft) well offshore for Mexico. The estimated reserves are greater than 3 billion barrels. If BP can drill successfully at that that depth, safely, and without harm to the environment, then drilling in Alaska’s relatively shallow coastal waters should be a piece of cake.

I spent 5 months in Canada working on an oil field services related R&D project. I have seen the impact of energy development on the communities in Alberta to B.C. Alaska is pathetic when it comes to energy development policy. Gov. Parnell’s move to support offshore drilling is progress in reversing the adversarial position of most of Alaska’s administrations to oil and gas development, including that of former Governor Sarah Palin.

Tuesday, September 1, 2009

Blackouts in South Central this winter!

It was very recently reported in the Frontiersman that Matanuska Electric Association is now warning of the high probability of rolling blackouts this winter.

With 35tcf of NG reserves, known and estimated, the most populous region in the State is now facing a third world power crisis in the dead of winter?


The primary issue is not so much a lack of natural gas in Cook Inlet, but the lack of infrastructure to deliver the gas in Cook Inlet to market and to store the excess for use during peak periods. Lacking is the storage infrastructure and the pipelines necessary to move the gas from the well to a storage facility. The storage facility may be above ground tanks or old gas wells. Lacking also are the needed storage facilities.

This lack of infrastructure is a travesty. This situation is the result of a serious lack of planning on the part of our leaders, and industry. However, industry cannot build the facilities needed without the permits to do so. The Regulatory Commission of Alaska (RCA) allegedly has been a major impediment to this process, not a facilitator.

Where was the leadership on the part of our government to prevent a crisis that has been building for many years, now?

For at least the last 10 years, this situation has been talked about, debated, pooh-poohed, and largely ignored. In the last gubernatorial election, it was a topic of concern, and a topic all admitted was serious, and if not addressed soon, would result in power interruptions at the very least.

Sarah gave lip service during the campaign, but did nothing to promote a solution. Knowles and Murkowski largely ignored the situation. Mark Begich and his predecessors complained of the looming situation, but did nothing other than the occasional public pronouncement..

The harbinger of this situation? The shutdown of Agrium’s ammonium nitrate plant at Nikkiski, resulting in the loss of over 60 jobs and the money they brought to businesses in the area.

Recently, the Regulatory Commission of Alaska held a public session in which the power utilities were castigated for not having any plans for such a contingency. Yet, this august body was the primary focus of a complaint by Marathon Oil regarding a lack of exploration and production permits during the last 10 years, having a great bearing on the short fall in available natural gas that will very likely result in your lights going out this winter.

The choice will be your lights or heat. Heat wins every time.

We voted to create the Alaska Natural Gas Development Authority to insure we had gas for use in Alaska and to get our North Slope gas to market. Yet, since its creation, ANGDA has been hindered, impeded, and stifled in effecting its voter created mandate. Both Sarah Palin and Frank Murkowski restricted ANGDA’s funding to the detriment of our natural gas development priorities.

An aloof Legislature has not aided in providing some modicum of a solution in the absence of the governors’ indifference, either through legislation making it easier for the oil companies to construct the needed infrastructure.

I just spent 5 months in Canada on an oil field services related project in British Columbia and Alberta. You can bet that what is going to happen this winter in Alaska cannot happen there. Socialist governments, with B.C. being the most restrictive, somehow manage comprehensive oil and gas development. Pipeline construction is ongoing.

Yet, south central Alaska is now facing the specter of rolling blackouts. Our North Slope natural gas still remains stranded. The Canadians rapidly move forward with a LNG port at Kittimat, B.C. to export natural gas to Asia. Meanwhile Alaska’s Rep. Jay Ramras says the coming Open Season will be a bust—meaning no forward progress on any pipeline proposal.

Alaska’s leadership has a terminal case of “can’t”.

There needs to be a serious shift in paradigms on the part of our Legislature, DNR and the Governor’s office regarding support for new oil and gas development here. Failing same, we need to replace one and all in the coming elections.

Keep sending the same tired faces back to do nothing, results in nothing being accomplished, except to spend money we no longer have.

Maybe, a few blackouts this winter will result in some needed change in Juneau?