Sunday, December 26, 2010

Parnell is briliant--he's going to reduce the size of Alaska!

Our new old Governor Sean Parnell is slowly steaming ahead with his agenda. I would have never given him credit for this, but . . . Gov. Parnell and the Legislature have come up with a pretty clever way to cut local government and the population of the State of Alaska by about 50% almost immediately! This plan is insidious in its brilliance.

Gov. Parnell’s economic plans should have included –by now—news of TransCanada and Exxon’s plans for a pipeline. Yet, all we hear from industry and other sources is that there will be no pipeline to Canada or to the U.S. for at least 20 years—per Larry Persily, the federal pipeline coordinator. Nor, will any LNG be sent to the U.S. from Alaska. It is just too cheap to ship all of that natural gas Exxon and Conoco converted in their LNG trains in Qattar 15,000 miles to the U.S. by LNG tanker, off load the LNG tanker, recondition the LNG, load it back onto the LNG tanker . . . and export it to Asia another 10,000 miles—and, still make a profit.

Yes, I remember Ralph Samuels sagely opining that it was just too expensive to ship North Slope gas 800 miles to Valdez by pipeline, convert it to LNG, and then ship it to a foreign market. Man, am I glad that we did not make that mistake! We would be just like all rest of those fools shipping LNG all over the world and making far more than the domestic price! Wow. We almost blew it, big time!

What would we do with all of those LNG tankers coming into Valdez to move 3 billion cubic feet of gas a day to market?! Not to mention that the gas liquids would have stayed in Alaska for fuels and industry, thereby creating more jobs. And, why would we build the 250 million cubic feet per day spur line from Glennallen to the Enstar Hub at Palmer to relieve the gas shortages in the Kenai/Cook Inlet gas fields? What would the pols have to commiserate over?! We did not need those jobs, either! Thank you Ralph and Sean!

Alaska did not need all of the jobs and businesses that would have been created by building the natural gas pipeline to Valdez. Remember, 138,000 Alaskans voted to build that pipeline. Just foolishness! Why, we don’t need to worry! We can all work for the State! Right, Gov?

After all, Conoco let the cat out of the bag just before the elections. The intent was to warehouse North Slope gas for at least another 20 years. Yet, Conoco is still going forward with Denali . . . ? Uh . . . some things are better left alone, I guess, otherwise it hurts your head trying to follow the logic.

Oh, you folks that opposed building the all-Alaska natural gas pipeline and shipping our gas to Asia markets were so sage. . . .

What was it Larry Persily opined? No pipeline for 20 years?

I guess that we are just supposed to forget that we have a gas shortage that will result in brown outs and a loss of heat and power for up to two years in south central if a compressor fails in the Kenai fields. What fun that promises!

Just think, over 300,000 Alaskans without heat and power during the coldest part of the winter, maybe two winters. And, most of them . . . armed. Uh, oh.

If that is a means to get property values down, that will do it, alright.

I guess we should also forget that during this last election, it was revealed that TAPS will reach a critical juncture much sooner than expected. The point at which TAPS cannot be restarted due to a shutdown is now much closer.

We were all fat dumb and happy thinking that TAPS would continue to transport oil down to 300,000 barrels per day production. Oh, no. This has been revised to 500,000 barrels per day. Meaning, that within the coming four years, we may see an end to TAPS moving our oil once production reaches 500,000 bpd or less, and there is a shutdown of the pipeline for any reason. With that shutdown ends 90% of the State’s revenue.

Do you think there will be an income tax, not to mention a State sales tax and, maybe even a State property tax proposed over the next two Legislative sessions?

Wait a minute.

We have the Permanent Fund! Let’s see, that’s about $35B or so. At a yearly budget of $11B growing by at least 10% per year, we can hold out for . . . 3 years? Then what? Don’t think about it, our legislators and governor aren’t, so why should we?

How long will the PFDs last? Anyone want to make a bet past 2013?

The only “pipeline plan” being discussed publically is the idea of building a 36 inch or 48 inch natural gas pipeline from the North Slope to Fairbanks. After that . . . who knows? Indecision reigns supreme. Gone is any mention of the “bullet line” from Fairbanks to Anchorage. Avoided like the black plague is any mention of the all-Alaska natural gas pipeline to Valdez. Now, all we hear is that importing natural gas to Cook Inlet is inevitable.

In Canada, poly pipelines are being installed year round for gas distribution to market. You see it all over the west. Just awesome their expansion and aggressive development of their NG resources. The Canadian government just approved the MacKenzie River Delta 1.5 bcf natural gas pipeline project. In the mean time, the success of the LNG export facility at Kittimat, B.C. is no longer doubted by any here or there.

The MacKenzie River Delta pipeline is going ahead, the national energy board in Ottawa said it needs to be done, all the aboriginal malarkey is settled, and it is and will always be . . . Canada first. That project will pretty much see an end to the hot air expounded over any idea of moving our gas to Canada. We won’t be able to give our gas away if this dodo bird attitude on the part of those in Juneau continues regarding LNG exports and instate use of the gas liquids.

Yet, in Alaska . . . well, the sage heads in the Legislature and the Governor’s office have decided that in about 5 years or so the Grinch is going to visit all of us, if not before. “Before” may be a compressor failure on the Kenai, or the inability to restart TAPS after a maintenance or leak shut down. Then what? The silence has been deafening.

The Alaska Legislature and our governors have been very successful in ignoring the obvious. We have to trust them to keep doing just that. After all, a little misery and cold never hurt anyone. Right? Just suck it up and keep moving, soldier.

Enjoy heat and lights while we have ‘em!

And, then, when we all get cold enough and angry enough, let’s enjoy tar and feathering the legislators and the governors who served from 2002 forward who ignored our will. There will still be diesel to heat the tar.

Sarah looks good in black, too.

Just before we do Parnell, we should give him an award for the success of his brilliant plan. After we finish tar and feathering him, we will send him to Washington to advise President Obama on resource development, cutting government, and population control.