What did NO on Prop 1 do for Alaska . . . NOTHING.

SB21 brought industry commitments.
So say T.J. Presley and Nick Moe, the two who pushed the SB21 Prop 1 NO campaign.
Industry commitments?
 What industry commitments?
 What did Alaska trade with SB21? Another one-way deal brokered by Hawker and Chennault, Conoco's boys.
BP is laying people off.
The work being done is maintenance that was ignored for many years. Now, maybe, in 2016, there will be a favorable Congress elected and a President who just might open ANWR and allow offshore oil and gas development. Makes sense to spend the money, just in case.
How will offshore development help or benefit Alaska? Alaska does not get a cut of those royalties. Aside from whatever village becomes the staging area, there is no benefit.
Then, there is the idea of upping production in a time of 'glut'. How many tankers from Valdez full of Alaska crude are turned away from West Coast refineries, because of the wealth of shale oil being produced?
Is our oil wanted in the market right now?  No.  There is an excess of oil, with surpluses being produced in the Middle East as a hedge against any crisis that might cause a spike in demand.  
Saudi Arabia is trying to produce sufficient surplus oil to cause a downturn below $80/bbl as part of a plan between the Saudis and the Obama Administration to create financial stress on Putin's Russia.  At $80/bbl, Russia can pay for government, at $79.99/bbl, it cannot.  Now, you know why the price of oil has been declining lately.
What happened to the NG from Qatar that was supposed to supply the U.S. domestic needs for 25 years? The first LNG tanker was turned around and sent to Asia last May. That gas now supplies 60% of the Japanese LNG market.
Even though the Japanese are looking for new suppliers, Alaska's governor and Legislature are not interested.
 Our governor and Legislature could have cared less about the Japanese delegations that came to Alaska to secure LNG post the Fukishima meltdown.  The Gov and the Legislature evidently work for Conoco and Exxon. That is clear, otherwise, why would $3B in potential investment into an Alaska natural gas pipeline and LNG train have been allowed to walk to Kitimat and Chenier in LA? Alaska was not interested in the deal, so the money walked and was invested elsewhere.
What did NO accomplish? More money for the oil companies, less for Alaska.
I am a no tax kind of conservative. I believe that Alaska should have stuck with royalties and never bothered with taxes on the oil industry. We would have been much better off, and the oil industry would have thrived here with a vibrant oil and gas service industry instead of the few companies engaged in oil and gas anything in Alaska--fiscal certainty and all of that. However, we became greedy, allowed our gov't to milk the oil companies and now, we play stupid games. Our Legislature and governor studies and studies and studies and we languish wondering if there will ever be any new development in the oil sector and in the gas sector?
People move to Alaska hoping, only to find an expensive place to live with the economy largely being fueled by gov't money.  Eventually, those taillights will be headed south--sooner the better.
The oil companies promised nothing and that's what we received with SB21. Nothing.
There is no leadership in Juneau. The increasing spending is a demonstration that we have devolved from building infrastructure with our oil royalties largess to maintaining and keeping the plebes happy with social entitlements. No leadership, no direction, no commitment to do other than kiss the oil companies' corporate posteriors in the vein hope that they will pull the rabbit of economic prosperity out of the declining oil revenue hat before we use the entire PF to keep the illusion of fiscal solvency alive. That is the problem, has been the problem ever since Sarah Palin was elected, left Alaska, and the boy wonder, otherwise known as Captain Zero, became Governor six years ago. Yeah, six years, we've been blessed with . . . nothing.
Now, we have a $7M per day deficit spending with Governor Parnell's spending excesses.
 SB21 is still the law, meaning less money to the State.
Fine.
Now what?
November will be the 'what'. The Legislature will not change. The same "me toos" will be back in Juneau to do what Hawker and Chennault say.
Hopefully, Bill Walker and Craig Fleener will have their shot at running the State. At least we will have a governor who has a plan to move forward with economic prosperity and fiscal responsibility as the goals.




http://www.adn.com/article/20140825/defeat-oil-tax-referendum-puts-alaska-win-win-territory

Alaska's eggs are all in the oil basket, like Norway, we have screwed up

Alaska’s Legislature and Governor like to point to Norway’s success with its savings account from Norway’s oil development. Over the last 50 years, Norway has managed to sock away $740 billion in the Norwegian Oil Fund (NOF), Norway’s savings account from oil development royalties. Is Norway’s fund truly the outstanding example of sound fiscal management pointed to by our politicians?

Jerome Vitenburg, an international political analyst, citing a 2011 study by Michael Hudson of the University of Missori, in the Washington Times says no, Norway has not been a good steward of the incredible wealth afforded by the oil boom. Bad investments, a rapidly expanding welfare state, and the failure to invest in Norway’s industry and infrastructure raise serious doubts about Norway’s financial future. Like Alaska, Norway has failed to invest wisely in itself.

Norway has failed to improve its non-oil related industrial infrastructure. Norway has invested heavily outside of Norway. Alaska has done the same.

There is no requirement under Alaska statutes for a percentage of Alaska’s Permanent Fund to be invested into Alaska. (AS 37.13)

Increased production threatens Norway’s oil revenues as oil prices are expected to fall with new production coming on-line in the U.S. and elsewhere from shale deposits and new technologies improving recovery. Alaska faces the same potentially draconian economic future.

Alaska is also particularly vulnerable to such a decrease in oil revenue. This year is expected to be the first year of deficits between spending and revenue, by -$500,000,000, since the precipitous drop in the price of oil in the 1980s and in 1999, when oil dropped to $20 per barrel. Delays in building a natural gas pipeline to tidewater further accelerates Alaska’s coming fiscal collapse, because of the failure of the Legislature to understand the LNG market and Governor Sean Parnell’s insistence in adhering to Sarah Palin’s failed AGIA policy until very recently.

Governor Parnell has finally closed the Alaska Gasline Incentive Act (AGIA) office. Prior to his Natural Resources Commissioner recently announcing that the State would consider a direct investment to secure 20% of the project ownership, Parnell steadfastly stood by Sarah Palin’s Alaska Gas Inducement Act (AGIA) guidelines. Now, it looks as if the Parnell Administration has realized that Bill Walker was correct in his promoting the State’s involvement in a major natural gas infrastructure investment.

Unfortunately for Alaska, Parnell has yet to ask the Legislature to provide the legislative authority to make such an investment and to set a time table for construction. Governor Parnell continues to wait for the oil companies to make that decision. Something that they have been extremely reluctant to do, as they do not want Alaska’s North Slope gas doing other than pressurizing the North Slope oil fields until technology can allow the recovery of most of the 20 billion barrels of oil from oil sands deposits under the surface of the North Slope. The "money" for the oil companies is in oil production, not natural gas production. They have plenty of natural gas from foreign sources and shale plays in the lower-48. They do not need nor want Alaska’s natural gas in the world market competing with these other interests.

There are serious conflicts of interest on the part of the oil companies with their foreign developments, which would compete with Alaska LNG for market share in Asia. TransCanda also has a conflict of interest with its contract with Shell for a natural gas pipeline to Kitmat, B.C., Alaska’s competition as an LNG export terminus. Unfortunately, the AGIA legislation and subsequent contract with TransCanada never required "conflict of interest" as a condition to justify cancellation by the State of Alaska. Only economic conditions are stated as a basis for cancellation by the State. An example of poor business judgement on the part of former Governor Sarah Palin.

Meanwhile, Japanese LNG customers are paying $16 per million British thermal units (MMbtus) for delivered LNG. In 2010, a study by Woodward MacKenzie demonstrated delivery of Alaska LNG to Japan could be done for approximately $8.50/MMbtus. Yet, in the intervening time period since the 2010 elections, the Parnell Administration failed to move any natural gas pipeline proposal forward, preferring instead to seemingly ignore the natural gas issues altogether, putting any lack of progress into the lap of the oil companies. The Legislature was given free reign by this governor to establish policy and direction. Parnell did manage to reduce the oil companies’ production taxes in a modification of Sarah Palin’s Alaska Clear and Equitable Share Act (ACES) of 2007.

What progress has been made on a pipeline proposal has been in favor of the Alaska Stand Alone Pipeline (ASAP), which is the former bullet line. In late 2012, Congress authorized a 7 mile right of way through Denali National Park using the Parks Highway right of way. This surprise on the part of the Obama Administration coincided with the oil companies (Exxon, Conoco and British Petroleum) decision to "study" a pipeline terminus at Nikkiski, rather than use the established TAPS corridor to Valdez for any natural gas pipeline to move North Slope natural gas to tidewater. The economic viability of the ASAP line has been debated since first proposed as the bullet line under then pipeline coordinator Harry Noah appointed by then Governor Sarah Palin. AGIA limits the volume to no more than 500 million cubic feet per day (MMcf/da), making the ASAP pipeline, like the bullet line, uneconomical. The interesting aspect is that the State would have to fully finance the construction.

Bill Walker was heavily criticized during the 2010 gubernatorial primary for suggesting even a partial State buy-in as part of his all-Alaska natural gas pipeline plan. Such a buy-in to control management and to set time lines was termed "socialism", even by Ralph Samuels who was a proponent of the to be 100% State financed bullet line scheme concocted under then Gov. Sarah Palin.

By contrast to Alaska’s lack of measurable new oil and gas exploration/development since the 2010 elections, Texas is now back up to 2 million barrels a day of oil production from shale deposits, doubling its production of two years ago. Texas expects to exceed that production and to see production rise to the levels of the 1960s and 1970s when oil production was well over 2 million barrels per day. As of December, 2012, oil production in North Dakota reached 770,000 barrels per day. North Dakota’s oil production now exceeds Alaska’s oil production. Alaska’s oil production is declining rapidly and is presently at 549,936 barrels of oil and natural gas liquids per day.

Improvements in production technology is resulting in the ability to recover more and more oil from shale plays and oil sands deposits. New technology is also allowing recovery from wells where production was reduced to the point of being uneconomical, because of paraffin impeding the oil flow. Increasing domestic U.S. oil production has led to demands by the oil companies for legislation allowing the export of crude oil from domestic U.S. production for the first time since the 1960s. For the first time in decades, energy independence is being spoken of with certainty in the U.S. The increasing supply should lead to a decline in oil prices.

Norway’s oil fund is limited to investing no more than 4% of its NOF in Norway. The bankers and accountants who consulted to the Norwegian government applied a model of immediate return. Ignored by this economic investment model are the major government-level investments that are designed to facilitate growth in industry, to insure an educated and motivated work force, and to provide the transportation infrastructure needed to support commercial growth. However, the bankers and accountants won out with the argument that to invest in Norway’s small economy beyond 4% would cause inflation that would eventually devastate the local economy. The Alaska Permanent Fund was set up using a similar, shortsighted philosophy.

This same mentality of a quick turn around for money, investment in financial schemes rather than creation of equity through manufacturing and building, resulted in the ponzi schemes of the 80s and 90s of the ".com" stock failures and the sub-prime mortgage disaster, leading to the current recession with the bailouts, quantitative easing by the Fed, and the incredible spending of our Congress and President to no good end.

Europe was doing its own version, and the economic fall out is continuing there like it is here, with high unemployment, currency inflation, and an ongoing recession. Asia, mainly the PRC, is feeling the pinch as well, as the West is the primary beneficiary of its cheap labor and communist controlled economy.

Yet, the historical precedent for the growth of the Western economies was based upon the idea that government facilitated such growth by investing in the public sectors of utilities, transportation, and education to give the private sector the tools necessary to grow the country’s economy. The Tennessee Valley Power Authority is a prime example of a national initiative to increase power production in the U.S. in the 30s.

Instead of growing Alaska, Alaska’s leaders of the time, as had Norway’s leaders previously, decided to grow government as the means of giving the greatest benefit to the people of Alaska. A government that soon tired of public projects, and devoted itself to keeping the ‘hands out’ crowd happy and complacent by increasing welfare gratuities and growing government to do so, thereby directly benefitting fewer and fewer people, largely government employees. "Can’t" has become the new Alaska State Government policy to excuse the continuing lack of infrastructure. The only thing created these days is more welfare spending programs and a bigger bureaucracy at every level of government.

There are people who worked in Alaska for a city government, vested, then vested with a borough government, then did the same with the State, as some local subdivisions required vestments of only five years. Once they retired from the State, they left the State with multiple retirement vestments from three levels of government, full life-time medical, and great retirement benefits. In other words, they raped us, and they are still doing this today.

Former Governor Jay Hammond, the father of Alaska’s Permanent Fund and Permanent Fund Dividend program, never intended that the PFD become an entitlement. It was always intended that either the PFD would be offset by an income tax, or discontinued when the oil production declined beyond a sustainable level for government to justify the payment to the people. The PF was to be used as a ‘rainy day’ fund, similar to the intent for the Norwegian Oil Fund. This flawed strategy is now coming home to Alaska’s current Legislature and Governor Sean Parnell. Neither is doing anything to prepare this State for a post oil economy.

In a 2011 analysis "What Does Norway Get Out of its Oil Fund, if Not More Strategic Infrastructure Investment", economist Michael Hudson warned of impending problems with the Norwegian Oil Fund investment strategy. Norway has been investing its National Oil Fund in Brazil, Russia, India, China, and in questionable real estate in Europe and the U.S. The investments in China, Brazil and India being used to create industry and infrastructure that will compete with Norway’s indigenous industries.

In the current world economic recession, such investments are questionable in the long term, given the economic uncertainties and the current penchant for currency inflation to make products more competitive by the aforementioned countries. The infrastructure investments that are the responsibility of government to keep Norway competitive in a changing global economy remain underdeveloped and ignored, while the social welfare burden continues to increase in the face of declining oil revenues. Even in the face of $740 billion in its NOF, Norway has managed to accrue $657 billion in foreign debt. Norway has borrowed money even with the NOF.

The United States became the economic power house that it did, because the government invested in the infrastructure to facilitate the growth of business and to access natural resources through roads, airports, harbors, schools, utilities, and regulatory oversight. Regulatory oversight at the time was designed to facilitate, not to impede growth. Part of the infrastructure created being necessary to the national defense. The U.S. interstate highway system is a good example of military necessity also serving the needs of commerce.

Mr. Hudson opined that 60% of the Norwegian Oil Fund should have been invested in Norway to build non-oil industry infrastructure to hedge against the competing oil production increases resulting from the U.S. and other foreign shale and normal production and improvements in recovery technologies. With the increased supply in the market, oil prices should decline. Norway’s investment in foreign growth is now paying a negative dividend to the future of the Norwegian economy.

Hudson gave the following example of the shortsightedness of the use of Norway’s oil fund money by comparing how those countries that benefitted from Norway’s investments are using their funds:

"While investing at home to improve their quality of life, China, Singapore and other nations manage their Sovereign Wealth Funds with an eye to shaping their economies for the next twenty, thirty or even fifty years. They are buying control of the key foreign technologies and raw materials deemed most critical to their long-term growth. This broad scope invests export earnings directly to make their economies more competitive while raising living standards."

Norway’s oil wealth has gone to the benefit of other countries through investment in business and in direct investment in infrastructure projects, all of which serves to build their economies at no direct benefit to Norway’s economic future. Foreign investment makes it easier for those governments to make the needed investments in their infrastructure, and to procure foreign raw materials sources for future growth, because the Western investor is paying for the growth of their companies, both private and state owned enterprises, without consideration of the long term impact upon their home countries’ economies.

Unfortunately, for Alaska and Alaskans, our Permanent Fund is largely doing the same: investing outside of Alaska without benefit other than a check once year to each Alaskan, the continued expansion of a bloated self-serving government, and an increasingly demanding welfare state that will collapse with the decrease in oil production in the very near future.

Alaska’s Regional Native Corporations follow the same strategy, which benefits a few, and pays off the many to keep them quiet with respect to seeing any benefit locally. However, they can sell their losses to solvent companies as a tax break to that company.

Norway, like Alaska is a literal one-trick pony, almost completely reliant upon oil for its revenue to run its government, and to meet its growing social welfare state obligations.

Alaska’s Permanent Fund (PF) does not invest in Alaska. Anywhere but Alaska seems to be the strategy. The PF investment goal is an increase of Fund assets by 5% per annum. Our Legislature and Governors have concluded that Alaska is a bad investment: do not use the PF to build roads into the Bush, to improve harbors and airstrips in Alaska to reduce the cost of living and to provide for the defense of Alaska, or to access our natural resources for development, to increase the exploration and development of our hydrocarbon resources, or to provide for the basic services that government is charged to do for all Alaskans. Our budget, State and Federal funds last year was over $10B. Yet, not one mile of new road was built, nor were the current roads improved or repaired. Meanwhile, the PF continues to invest in the stock market, which is literally gambling with Alaska’s oil wealth. As of this year, Alaska’s public indebtedness was $8.2 billion.

Norway is not the standard to be followed. The debt structure alone is enough to dissuade the prudent man from believing that Norway’s government has been a good steward of the benefits of its oil reserves. Norway’s debt of $657 billion is foreign held debt. Meaning, Norway has borrowed money in the face of their oil fund’s wealth.

Alaska is again issuing bonds to finance purchases.

Without diversification of Norway’s economy by government investment to build the infrastructure to support non-oil related industry, Norway is ill prepared to compete in a world market once the oil is gone. Norway will have to compete with those very economies in which Norway’s oil wealth has been invested. China, Russia, India and Brazil continue to garner more and more world market share across industry sectors, while Norway is frozen in the belief that it can continue to expand its welfare state without investing in its economic future.

Sadly, Alaska follows this shortsighted course by our Governors’ (primarily Palin and Parnell) and the Legislature’s refusal to recognize the hydrocarbon market trends and act accordingly to invest in the infrastructure necessary to access and to support development of the tremendous resource wealth of this State. Instead of investing in Alaska, we have invested in our competitors’ economies, and in policies and regulations by a distant federal government through federal bonds that serve only to further restrict Alaska’s ability of self-determination. Alaska’s debt structure is not as far along as Norway’s, but our lack of a viable transportation infrastructure makes much of Alaska as remote and our resources as unreachable as in most of the third world. Only there, they do not have a hostile and interfering federal oversight that serves other interests to deny Alaska its rightful self-determination as a State in the Union of States.

Given Alaska’s $10B budgets of late, $8.2B in indebtedness, how long will our $50B in the PF last? The trend is ever larger State budgets in the face of an average 6% loss of North Slope oil production each year. If there is a drop in the price of oil below $80 a barrel, Alaska will be in serious financial straits. Further, it is doubtful that the TAPS can deliver oil when production reaches 300,000 barrels per day or less. That day is not long off, given the 549,936 barrel per day level of production at present.

The Parnell Administration has continued to ignore the construction of a natural gas pipeline to tidewater that would, with the right governor at the helm, increase State revenues slightly, but have the potential to do much more. The long term benefit of such a project would be to provide any remaining gas liquids for use in Alaska to create a petrochemical industry for the Interior, and use part of the gas transported with the export volume to provide cheap heat and power for Alaska’s communities in the Interior and in South Central Alaska. Such in-state use of North Slope natural gas would impact industry across the board, and enable kilns for timber, refridgeration for agriculture, and the creation of jobs across industry to provide opportunity beyond just building and maintaining a pipeline. There is the true benefit of our resources, not in a mere export scheme to feed a bloated and inefficient State government that benefits a few, and not the many.

Such an in-state energy infrastructure project would further enable increasing the available gas in Cook Inlet, until exploration and development could catch up with increasing demand. The LNG terminal at Nikkiski would continue to export Cook Inlet LNG to Japan, as is still being done after 43+ years, without concerns about shortfalls in supplies for home heating.

A good indication that increasing natural gas supplies will positively impact the State is the December, 2012 air quality permit by Agrium to restart the fertilizer plant at Nikkiski on the Kenai Penninsula. Agrium shut down its Nikkiski plant in November, 2005 resulting in the loss of 230 local jobs.

Long term, well paying jobs would be the benefit of the correct application of governmental responsibility and involvement in large scale infrastructure projects, the natural gas pipeline being such an example of potential State participation. 30% of Alaska’s private sector jobs are oil industry related. Such State support would increase the size of the private sector beyond just the oil/gas industry support and services. The all-Alaska natural gas pipeline proposed by the Alaska Gas Port Authority during Sarah Palin’s campaign of 2006, and again in 2010 during Bill Walker’s run for governor in the Republican Primary was such a project.

High oil prices have kept the wolves of recession away. This keeps a private sector that largely serves government from facing the reality of the current world recession. However, the fires of growth are cooling, contrary to our federal government’s protestations to the contrary. Like Norway, the prospect of lower oil prices, declining production, and an indifferent Governor and Legislature point to uncertain and turbulent times for Alaska’s economy.

In 1999, the price of oil hit $20 a barrel. Today, that would mean the Permanent Fund would have to be used to defray the costs of government until the price of oil returned to sustainable levels. Something that could take longer than the PF would last.

Alaska First must be the only policy on the part of our Legislature and Governor, or Alaska will be the last to the world LNG market party and the loser by virtue of a retiring, reluctant and recalcitrant State government that has failed to see the need to invest in Alaska First. Vision, courage, commitment and leadership must replace the "can’t" in the Governor’s vocabulary. That means a change in governor.

Norway’s example as a steward of its oil wealth for the benefit of its people is not a good example for Alaska. Once again, our leaders have been short sighted in their consideration of Alaska’s future.

For more information:

Alaska Statutes:

AS 37.13.020

http://www.apfc.org/home/Media/investments/20130523InvestmentPolicyD.pdf

Alaska Division of Oil and Gas, Dept. of Natural Resources, SOA

http://dog.dnr.alaska.gov/

Norway’s Sovereign Wealth Risk Vortex:

http://michael-hudson.com/2011/03/norways-sovereign-wealth-risk-vortex/

Alaska Public Debt 2012-2013

http://treasury.dor.alaska.gov/Portals/0/docs/debt_management/debt_book_2013.pdf



Michael Hudson is the President of the Institute for the Study of Long-Term Economic Trends (ISLET), Wall Street Financial analyst, Distinguished Research Professor of Economics at the U. of MO. http://michael-hudson.com/about/

http://www.bizjournals.com/bizjournals/on-numbers/scott-thomas/2012/05/governments-employ-20-percent-of.html

http://www.spokesman.com/stories/2012/may/15/north-dakota-now-no-2-oil-production/

http://homernews.com/stories/010605/news_0106new005.shtml

http://search.peninsulaclarion.com/fast-elements.php?querystring=%22FERTILIZER+PLANT%22&offset=0&hits=10&hc=y&type=standard&profile=kenai&tags=FERTILIZER+PLANT&addListings=true

http://peninsulaclarion.com/news/2013-06-27/agrium-inspecting-equipment-at-its-closed-plant-work-to-continue-through-fall

http://www.alaskajournal.com/Alaska-Journal-of-Commerce/December-Issue-3-2013/Agrium-Inc-applies-for-key-permit-to-allow-plant-restart/

CANCELLED!: Meet Bill Walker and Craig Fleener, Wasilla this Friday 4pm to 7pm at Re/Max in Wasilla!

CANCELLED DUE TO ROAD CONDITIONS!

Please join us, 4pm -7pm, Wasilla Re/MAX building to meet Bill Walker and Chris Fleener, candidates for Governor and Lt. Governor.

Bill Walker will not hesitate, but Parnell just sits and waits for . . . ?

With the oil and gas conversation in Alaska politics focusing on the upcoming referendum on HB21, the Governor’s recently passed reduction in oil taxes, there has been little news on the natural gas pipeline front since the Producers promised further "studies". The last news from the producers was that they had made a preliminary decision with respect to the port of export. They chose Nikkiski, but were again studying the situation further, meaning no decisions to actually build a pipeline until a time uncertain into the future.

The Producers’ had to know of the impending legislation in Congress that would give a right of way through Denlai National Park. S.157 and H.R. 586 were introduced in June, 2013. This legislation allowed a natural gas pipeline to be built along the 7 miles of existing highway right of way that runs through Denali National Park lands. A take-off to the park facilities through an existing utility corridor would extend from the park entrance to the park facilities to allow the Park Service access to the gas. The Secretary of Interior would be required to issue a permit for the line crossing federal park lands if it meets environmental reviews and meets ANILCA requirements. Per Eric Elam of Young’s office, the legislation passed the House and Senate and was signed into law on September 18, 2013. The bill also provided funding for the Kantishna Micro-Hydro Project, a 50kw hydro-power project to provide power to the Kantishna Roadhouse owned by Doyon RNC.

With the signing of the legislation into law, a major hurdle in the construction of any natural gas pipeline down the Parks corridor using either the Alaska Railroad right of way or the highway right of way has been eliminated. This does not mean that litigation will not ensue on the part of the anti-development forces aligned against any development of Alaska’s resources. These forces have had two major victories to date.

The Pebble Mine project is all but history with Anglo Mining pulling out. Usibelli Coal has not been able to move forward on the Jonesville Coal Mine in the Matanuska Valley for the same reason. Therefore, the likelihood that the greenies will let any natural gas pipeline construction move through Denali, even using the highway right of way, without litigation to extract blood money is unlikely. Alaska’s history is rife with opposition to major resource development by Outside groups who have no other vested interest other than using the courts and Alaska as a revenue source.

The only pipeline corridor that is free of any litigation is the TAPS corridor, which is the choice of Bill Walker in both his 2010 and current gubernatorial campaigns.

Legislatively, the way is now clear for a pipeline down the Parks or a pipeline down the Richardson highways. The choice is which way, and most importantly when?

Japan is facing a shortfall in LNG due to interruptions from some LNG suppliers, such as Nigeria. Japan will be facing higher gas prices over the winter, because of the necessity of purchasing LNG spot cargoes rather than receiving LNG as part of a long term contract supply. The situation is rife for potential for Alaska’s North Slope gas. December deliveries to Japan is $17/MMbtus. Last year, the average was $13.25/MMbtus. Qattar will not be able to supply additional LNG to Japan over the winter, with supplies contracted to other buyers. Qatter supplied gas to Japan helping to keep the price down to $13.25/MMbtus.

The Wood-MacKenzie Report demonstrated a delivery to Japan of Alaska LNG North Slope gas of approximately $8.50/MMbtus. Using a 10% inflation per annum figure since the report’s release in 2010, gives an estimated delivered cost of approximately $11.31/MMbtus today, without respect to market considerations, and depending upon whether or not one believes the government’s inflation figures or what is experienced in the rising prices of other commodities. 

October Japan LNG market prices are $15.15/MMbtu. By December, the Japan LNG market prices are already contracted at $17.20/MMbtu. China is competing with Japan for LNG, causing increasing prices for existing supplies.

The specter of Alaska LNG competing with LNG from Kitimat is very real with Shell’s planned LNG terminal. Shell let a $4 billion contract to TransCanada to build a 2 bcf-2.5 bcf natural gas pipeline to 700 kilometers from B.C. shale fields Kitimat. (Yes, the TransCanada partnered with Exxon . . . ) Shell has partnered with Korea Gas, Mitsubishi and PetroChina to build its Kitimat LNG terminal.

Meanwhile, Governor Parnell waits, the oil companies study, and Alaska faces an increasingly uncertain fiscal future.

Either Governor Sean Parnell does not want to remain governor, or he is getting some bad advice with respect to his failure to move aggressively into the Japanese market.

His competition for the governor’s job will not be so hesitant. Bill Walker has been a relentless advocate of moving Alaska’s North Slope to market as LNG before the LNG market in Asia is diminished by other suppliers. Japan has been a primary focal point in his marketing of Alaska LNG. Walker and the Alaska Gas Port Authority have been tireless in their promotion of Alaska’s natural gas to Asian markets. Remember, the all-Alaska natural gas pipeline being promoted by AGPA and Bill Walker was the basis for Sarah Palin’s campaign for governor. If Governor Sean Parnell will not make a decision, Bill Walker and his Lt. Gov. candidate Chris Fleener will.

For more information:

LNG Insight: Utility buyers change buying strategy for winter
http://www.platts.com/videos/2013/october/lng-buyers?video_uuid=ngt147ob

http://www.platts.com/podcasts-detail/spotlight/2013/october/lng-prices

http://business.financialpost.com/2013/08/15/shells-kitimat-lng-project-gets-boost-from-asian-partners/?__lsa=128e-8da1

Congressman Young’s press release

http://donyoung.house.gov/news/documentsingle.aspx?DocumentID=348902

NOV 7 MEET AND GREET FOR BILL WALKER AND CRAIG FLEENER

If you cannot read the details in the above graphic, the link below will take you to the website with the announcement.

http://campaign.r20.constantcontact.com/render?llr=qiugaddab&v=001dXbC6UqaAI5fRUYGv57teBrwJ7cG9Z1nZrcgSMSgNh_gBde_5g0YO56KOq2nr6WjMe8yfwBH1o4VnGRjFryVwvF6T6P1xFeq4otpRkZLd218yGCEqC6niSjqxLc_g88HyS8vReTEWZ5zQ78WgMOudxEkq5dhDBaIGHD3rI6CwfZO1ypSqm9seH3D0sIgfY1oyAfXGcBZZaJSEW1ZiUEGkin6KOs1WnhzRLfzoKMN0hOFstCN5U0xXyiwrHckbZe9VCMSGr8bZLU4Y-mVbn349XVYMQYYnPJdGCPPjdIlBLc%3D

Campaign website:  http://www.billwalkerforgovernor.com/

Bill Walker Valley greet and meet and fundraiser Oct 23, 2013 at Jalapenos in Wasilla

 

Join us for a meet & greet/fundraiser for Bill Walker on October 23rd.  See invitation with details below.  Please forward this on to family and friends.  If you are unable to attend but would like to support Bill, you can donate here.      billwalkerforgovernor.com                                                                 (907) 332-2455                 Paid for by Bill Walker for Governor Campaign 731 N St., Anchorage, Alaska 99501

Bill Walker for Governor announces Chris Fleener as LT GOV running mate

Bill Walker's independent campaign moves forward with announcement of Chris Fleener as LT Gov candidate running mate.

 Fairbanks, AK, October 14, 2013 -- Independent candidate for governor, Bill Walker, announced today his running mate and candidate for Lt. Governor, Craig L. Fleener of Fort Yukon, Alaska.  Fleener is a lifelong Alaskan, military veteran and former Deputy Commissioner of the Alaska Department of Fish & Game.  He is Gwich’in Athabascan and is a descendent of the Doyon Limited region.  Each candidate will gather 3,017 signatures and appear on the November 2014, ballot.

 

EXPERIENCE: as the Deputy Commissioner of the Department of Fish & Game, Mr. Fleener provided policy and administrative guidance on wildlife and subsistence management, and worked closely with the divisions of Wildlife Conservation, Subsistence, and Habitat on policy, regulatory, management and funding issues.  He also served on the Alaska Board of Game, and also as the Director for the Division of Subsistence.

Prior to joining the Department of Fish & Game, Mr. Fleener served in several capacities for the Council of Athabascan Tribal Governments (“CATG”) in Fort Yukon, including service as Executive Director of that organization. While at CATG, Mr. Fleener served for a number of years as the only U.S. representative on the Gwich’in Council International, a permanent observer organization of the Arctic Council, an international body made up of eight arctic nations which identified problems and created solutions for pollution, international shipping, natural resource development, human dimensions issues and indigenous peoples’ concerns for the arctic region on a global level.

MILITARY: In 1986, Mr. Fleener joined the military and served in the United States Marine Corps.  He is currently a Major in the US Air Force Alaska Air National Guard, where he has served since 1991, and is a senior intelligence officer and recently served a tour of duty in Afghanistan as part of ongoing US operations in the region.  He volunteers as a board member for HAVE Alaska (Helping American Veterans Experience Alaska) providing psychological and physical rehabilitation for wounded veterans.

EDUCATION: Mr. Fleener received his Bachelor of Science degree in Natural Resources Management from the University of Alaska – Fairbanks in 1999, and in 2013 graduated with Honors from American Public University with a Master of Arts in Intelligence Studies.  He completed substantial work on a Masters of Science in Resources & Environment from the University of Calgary in Alberta, Canada in 2001, but was unable to complete the degree because of military activations.

"I am in this race to help bring all Alaskan voices together," Craig Fleener stated. "I am working to unite Alaskans and my ultimate goal is to bring us together to solve the problems that we face in order to build a stronger Alaska."

Bill Walker stated, "Craig Fleener brings to this Alaska ticket a depth and wealth of experience in fish and game management, military and veterans' affairs, circum-Arctic policy experience and his proud Alaska Native heritage."

 

 

The EPA now takes water samples from Alaska mines with a SWAT Team

The EPA is now part of an Alaska Environmental Crimes Task Force that is armed to the hilt to investigate "environmental crimes" by Alaska miners. Apparently, a dirty water discharge has now risen to the level of the use of deadly force against the offending miner.

Miners in Chicken were surprised during late August by groups comprising four to eight armed EPA agents carrying Glock .40 S&W cal side arms in full battle rattle with signs in big letters loudly proclaiming POLICE who stormed into several mines near Chicken in a full out assault to . . . take water samples. The EPA gestapo, and that’s all one can term such a heavy handed goon squad were there to take water samples to see if the miners were in compliance with Section 404 of the Clean Water Act. Something in past years that was done by one or two unarmed State of Alaska DEC personnel along with a representative of the EPA without rancor.

If the situation were not so serious, and the threat to the miners so real, this could almost be laughed off as a joke. However, armed goons with .40 cal Glocks in full battle rattle are not a joke. This event marks a new level of federal oversight on Alaska’s federal lands. Lands which the management of were supposed to be the responsibility of the State of Alaska under the terms of Alaska’s Statehood Compact. This event is an outrage and sets an extremely dangerous precedent for future regulation activities by the various federal agencies in Alaska.

Why were they there?

In a conference call with State officials including members of Alaska’s congressional delegation, the EPA stated that they had received information from the Alaska State Troopers that there was rampant drug and human trafficking in . . . Chicken, Alaska. Now, that is funny.

Sen. Lisa Murkowski opined that the situation was made up to allow the EPA (and DEC) to act as they did.

The AST’s spokesperson Megan Peters basically denied the EPA’s allegations as to receiving any information from the Troopers regarding anything at Chicken.

Why was there no court involved to protect the miners, if the EPA felt armed force was justified?

A member of the Alaska DEC was along to intimidate the locals at Chicken. The DEC agent was also armed. Now, DEC personnel are armed?!

What is going on here, Governor Sean Parnell?

The only police agency that should have had any armed presence was the Alaska State Troopers. They have jurisdiction statewide. Why were no Troopers part of that armed affront to Alaska’s sovereignty?

Chicken, Alaska is a historic mining town off the Taylor Highway has a resident population of 17 that grows to several dozen seasonally with the mining season. The mines are accessible by road, making it easy for the federal wanna be cold stone killer infantry wanna be Gestapo goon squad. Had this been a "raid" conducted at off the road, remote mines, there is a likelihood that they would have been met with armed resistance, as many mines maintain arms for self-defense and predators–both two legged and four.

The Alaska Environmental Crimes Task Force is made up of members of the Alaska State Troopers, the EPA, the FBI, the Coast Guard, the Department of Defense, and the Alaska Department of Environmental Conservation.

Only one mine checked had a water sample that "looked" over the particulate limit.

Where is Governor Parnell on this issue?

As with the Jim Wilde incident on the Yukon River in 2010, silent.

What next, armored personnel carriers and machine guns to make certain your garbage sack is tied?

Better watch out for the Apache gun ships and Predator drones with Hellfire missiles if your car is running a bit rich and there is any smoke out the tail pipe.

We need a governor who will stand up for Alaskans and Alaska against the heavy hand of the Obama Administration.

Sen. Begich certainly will certainly not act to curtail this danger to the citizens of Alaska.

Bill Walker is running for governor, and Mead Treadwell is running for the U.S. Senate. Maybe, they will work to protect Alaska’s sovereignty and Alaskans from a DC mentality that clearly believes in armed force rather than a rule of law and due process.

For more information:

http://www.alaskadispatch.com/article/20130903/gold-miners-near-chicken-cry-foul-over-heavy-handed-epa-raids

Parnell broke the law.

The Republican Primary was a disappointment. In more ways than one. Not only did Parnell receive the nod to move on to the General Election, but he was given a free pass on his violation of his oath of office. Parnell has violated Article II Sec. 5 of the Constitution of the State of Alaska, not once, but twice. Now, we hear that it may actually have been 3 times with the appointment of a State employee to Dahlstrom's seat.

Parnell has deferred owing up to his indiscretions by alleging that he acted upon the advice of an unnamed junior attorney at the Dept. of Law. This excuse completely ignores the fact that Sean Parnell is a lawyer himself. What? He no longer understands the Constitution, much less now apparently has a diminished capacity to understand the English language?

Art. II Sec. 5:
§ 5. Disqualifications

"No legislator may hold any other office or position of profit under the United States or the State. During the term for which elected and for one year thereafter, no legislator may be nominated, elected, or appointed to any other office or position of profit which has been created, or the salary or emoluments of which have been increased, while he was a member. This section shall not prevent any person from seeking or holding the office of governor, secretary of state, or member of Congress. This section shall not apply to employment by or election to a constitutional convention."

What part of "for one year after" does not this governor understand? I think the provision is very clear. Gee, even I understand it.

What I find most disturbing are those who voted for both Joe Miller as a strong constitutionalist versus Lisa Murkowski as the compromised insider who ignored the Constitution. Yet, many of these folks voted for Parnell. How does one reconcile that paradox?

Sarah Palin campaigned on a platform that included integrity. Sean Parnell cannot lay claim to that, given his violation of the State's Constitution, to which he swore an oath to uphold and defend. Which, given the Dahlstrom and Therriault affairs, he did not.

How could one vote for Miller, then vote for Parnell?

How could one then claim the moral and legal high ground over the Obama/Pelosi/Reid trashing of our national Constitution?

Another excuse that I heard was that Faibanks and North Pole hold former Sen. Gene Therriault in such high regard that they were willing to ignore the fact of the constitutional affront by his appointment on the part of Governor Parnell.

Allegedly, the Palin crowd was also a factor, voting for Joe Miller, and then voting for Parnell due to his association with Sarah. Let me remind that Sarah Palin did not select Sean Parnell during the 2006 Primary. Parnell won the slot as her Lt. Gov. by winning the Primary. That he did on his own. I do not recall Sarah Palin going out of her way for Parnell’s election.

The only conclusion to be drawn is that these folks hold the Constitution of the State of Alaska in such low regard that it can be violated with impunity by a sitting governor, so long as that governor is Republican?

There are those who believe in "my party, right or wrong". I am not one of those. I believe in the rule of LAW.

If one can violate one's oath with impunity, then what's next?

I am more than worried about the integrity of the Alaska Republican voter and the hypocrisy demonstrated in this election. Even more troubling is the lack of integrity and honor demonstrated by our current Governor.

Will the new Legislature have the courage to impeach this governor, if he prevails in the General Election?

Have we come to this?

Dan Fagan, commentator and pundit with an afternoon radio show went into a screaming hissy fit today that was one for the record books. Dan is a showman, first of all, and an alleged conservative—or so he says. He called Bill Walker’s supporters commies and socialists. Those are exactly the terms that he used.

Why did this otherwise, articulate, experienced, and knowledgeable reporter go off the deep end?

Apparently, Dan Fagan reacted to the yes or no requirement put to the candidates by the moderator at the Resource Development Council forum held today. The candidates could only answer yes or no.

Fagan billed his revelation as proof positive that Walker was a socialist and union schill who could not possibly be a conservative.
Apparently, unbeknownst to Fagan at the time of his hissy fit, Bill Walker followed up on the answer in an interview by ADN report Sean Cockerham post the debate at the Resource Development Council Governor’s Forum today. What Fagan did not have to pass on was the “rest of the story”.

This is what Walker was quoted as saying in the ADN:
“Q—How did you vote on the 2006 gas reserve initiative? Yes, no or prefer not to say. (The question was about a proposal to tax North Slope natural gas reserves until a pipeline was built to bring them to market. It could have imposed up to $1 billion annual tax on the gas under land leased primarily by Exxon Mobil, BP and Conoco Phillips, most in the Prudhoe Bay and Point Thomson fields.)

Walker – Yes (Walker said in an interview after the forum that “we wanted to get the gas moving, the only thing we were missing for a gasline at that point was gas. At that point in time that looked like it was the way to go. I don’t believe that is the way to go at this point, the way at this point is to create the infrastructure. The producers have said…we will ship if there is a reasonable expectation of profit.”

Fagan is an accomplished reporter. He should have asked Bill Walker directly before labeling—slandering—Walker and his supports as commies and socialists in fit of outrage over a an absolute answer that was designed to reflect an absolutist position that did not apply to Walker. It should be stated that Walker has never served in the Legislature.

The Dan Fagan Show, on KFQD in the afternoon heavily promotes Ralph Samuels for governor.

Ralph Samuels is recognized as being in Third Place, folks, that’s why Fagan jumped without first “looking”. Fagan’s boy is losing, even with Rick Rydell on Keni 650 AM and Dan Fagan and Dave Stierens on KFQD 750 AM all pushing Ralph Samuels like he is our Savior and the only conservative running.

Fortunately, people are not stupid.

Former Rep. Ralph Samuels received over $10,000 from Bill Allen of VECO fame. This same former representative voted for the biggest capital budgets in the State’s history prior to Parnell’s whale of a budget. Those budgets included an increase in the size of state government by 800 employees. Yet, these “good conservatives” all tout Samuels as a fiscal conservative.

Yeah, well, if Samuels was a fiscal conservative, then I guess that would make Sarah Palin a fiscal conservative.

Samuels has also touted his leadership abilities. As House Majority Leader, his was the only vote against AGIA, Palin’s gas pipeline initiative. The only vote. In a House and Senate that did not really support or like Sarah Palin. Why was Ralph’s vote the only vote? When the going gets tough, and the objective is not what the troops want to achieve, a good leader picks up the pack and rifle and says, we gotta do it . . . let’s go. And, the troops either respect the leader enough to obey, or they don’t. Samuels stood alone. That shows me that he is not the hero that these guys continually represent him as, if he could not garner one additional vote in support of his position.

Samuels supports the bullet line, widely held by industry and the State to be too expensive to be competitive to imported LNG for Cook Inlet. That the bullet line would double the cost of natural gas in south central. How is that an economic plan?

Samuels also supports Conoco/BP’s Denali project. A gasline that does not have a market, and will take everything, the jobs, the money, the majority of the infrastructure to Canada. How is that putting Alaska first? How is that acting in concert with Article 8 Sec. 2 of Alaska’s Constitution? In this regard, Samuels shares common ground with Parnell.

Parnell supports AGIA, another take it all to Canada plan, and also supports the bullet line. Of course Parnell also considers himself above the law, given his problems with his appointment of legislators to the Governror’s office. These appointments were made in violation of Article 2 of the Constitution of the State of Alaska. How can we have a Governor who holds himself above the law?

Therefore, why does Fagan and the others try to paint the only gubernatorial candidate as other than what he really is? The only conservative running for the office of the governor of Alaska who will put Alaska and Alaskans first? And, who has a viable pipeline plan that 138,000 Alaskans mandated by vote in 2002?

If this man is a commie and an socialist to Dan Fagan, then Walker has good company in that regard. Given Ralph’s record, Rydell, Stierens and Fagan will have reconsider their labeling Sarah Palin as a RINO.

This race is too crucial for such silliness.

When TAPS falls to 300,000 bpd of oil, the system will be shut down. The problem of the oil companies going elsewhere is not ACES, but a combination of taxes, regulations and litigation . . . and, a world wide recession that reduced the demand for oil.

As a result of the regulatory environment, of which taxes are a part, and the litigatory environmental greenie assault on the oil industry through the courts, the oil companies went wherever they could work with as little environmental and regulatory hassle as possible. They went for as little as $1 per barrel of profit.
Yet, according to the pundits, it was all because of ACES.

Male bovine offal.

Alaskans must be informed. Please take the time to attend forums and read the websites of the various candidates. Listen to the pundits, but take what they say with a grain of salt. Fagan did his credibility a great deal of harm today by calling good people something that they are not: commies and socialists.

Fagan owes Bill Walker and his supports an apology and his listeners an apology for his acting without the “rest of the story”.

For more information:
http://community.adn.com/adn/node/152634?mi_pluck_action=comment_submitted#Comments_Container

Parnell's Plight

Governor Sean Parnell has dug himself a hole that is deep and wide. Parnell has enough trouble brewing that would cause any sitting governor to start looking at the Help Wanted ads in the local papers. There are four primary areas of concern.

Parnell’s first problem is AGIA.

AGIA was pronounced as DOA by Parnell himself with respect to any expected success of the Open Season. Parnell’s refusal to answer rival Bill Walker’s FOIA request for disclosure of the Open Season is proof that Parnell is playing a delaying game without any expectation of success.

Against AGIA is the reality of the shale gas developments in Canada and the U.S. The Outside gas reserves are estimated to be enough for a 150 year supply of natural gas. The fact of the lack of any permitting to show in the 3 years since the passage of AGIA belie his current assertions that AGIA is alive and well.

AGIA, like Conoco/BP’s Denali project, takes our gas and gas liquids to Canada, thereby benefitting Canada, not Alaska.

Is Parnell acting in the best interests of Alaska by pushing AGIA?

Parnell’s second problem is his contempt for the law with the growing controversy over his appointments of Nancy Dahlstrom and Gene Therriault as his Military Advisor and Oil and Gas Advisor, respectively.

This situation would not be so remarkable were it not for the fact that both Dahlstrom and Therriault were sitting legislators at the time of the creation of the positions to which they were appointed. As ‘advisors’ their appointments did not have to be approved by the Legislature. The problem for Parnell arises with the fact that both appointments were in violation of Article II of the Constitution of the State of Alaska:

“Section 2.5 - Disqualifications.
No legislator may hold any other office or position of profit under the United States or the State. During the term for which elected and for one year thereafter, no legislator may be nominated, elected, or appointed to any other office or position of profit which has been created, or the salary or emoluments of which have been increased, while he was a member. . . .”

There was little comment about former Sen. Gene Therriault’s appointment, except by yours truly and a few others. With the second appointment of Rep. Nancy Dahlstrom, the pundits and the press finally figured out that our governor was ignoring the law.

Is our Governor above the law?

Another indication of the contempt that his governor and his appointees have for the law is the conduct of Gov. Parnell’s MG Katkus in requiring a subordinate to appear in uniform to testify to the House Military and Veterans Affairs Committee in support of Katkus’ appointment as Commissioner DMVA and Adjutant General. This act was unprecedented, and constituted a blatant act of undue influence. This situation was akin to Gene Therriault filling in for the Governor at a campaign function in Fairbanks earlier this summer. Both situations constitute at the very least undue influence on the part of the Governor and by Katkus as Parnell’s appointee.

Parnell’s third problem is the contradiction to any claim that he is working to resolve the Cook Inlet gas supply crisis.

Parnell’s Oil and Gas Division refuses to timely renew expired Cook Inlet oil and gas leases to exploration and development companies. This failure by Parnell’s Oil and Gas Division is incredible in the face of the alleged purpose of the bullet line.

Is Governor Parnell playing politics with a critical gas supply issue to the detriment of Alaska’s largest population segment?

Parnell’s fourth problem that is indefensible and, perhaps, the least recognized by the media, is Gov. Parnell’s decision to virtually eliminate the Alaska State Defense Force as a viable emergency response asset under DMVA.

In 2006, many of the Army National Guard assets were called to federal active duty in Iraq, Afghanistan and Kosovo, leaving the ASDF to perform disaster response. ASDF was called to State Active Duty three times in 2006.

How is reducing the State’s ability to respond to a disaster a showing of leadership?

Are we voters going to let Governor Sean Parnell’s open contempt for the law and his failure in leadership stand?

FERC Misinformation

A recent decision by the Federal Energy Regulatory Commission (FERC) has provided the grist for the political mill of those opposing the all-Alaska natural gas pipeline and Bill Walker’s candidacy for governor. However, this is a case of the disinformationistas being aided by the silence of the lamb (Parnell), rather than it being the death knell to anyone’s campaign.

FERC recently declined to renew an application by Yukon Pacific Corporation for an LNG export train at Anderson Bay. This decision has been declared a death knell to Walker’s campaign by Walker’s detractors. Walker’s pipeline advocacy is in support of the all-Alaska natural gas pipeline to Valdez. The decision has been heralded as barring any export of Alaska gas, thereby ending both Walker’s candidacy and the Valdez pipeline option. Nothing could be farther from the truth.

The silence being on the part of the Parnell Administration in keeping quiet an inquiry of Jan. 28, 2010 from Pipeline Coodinator Bob Swenson made to FERC as reported in the Oil and Gas Journal in an editorial dated March 22, 2010.

Cheniere, Inc. is converting its Sabine Pass, TX LNG import facility to receive foreign LNG and to loop it back for export to Asian markets. Cheniere cites a 42% drop in LNG imports between 2007 and 2008 into the U.S. because of increased domestic supplies. This market trend results from increased supplies of natural gas in the domestic U.S. market from shale gas and other unconventional sources.

Cheniere has also applied for permits to export U.S. domestic produced natural gas to global markets. This would be only the second facility in the U.S. built to export domestically produced LNG to foreign markets. The first such facility was built at Nikkiski, Alaska and has been exporting LNG to Japan since 1969.

In his Jan. 28, 2010 inquiry to FERC, Gov. Sean Parnell’s pipeline coordinator Bob Swenson described 3 scenarios and requested to know if FERC would have regulatory oversight.

Scenario 1 was an in-state pipeline with North Slope gas being used in-state only. FERC’s response was that FERC would have no regulatory oversight authority for such use.

Scenario 2 was an in-state pipeline with North Slope gas being used in-state with some of the gas being exported to domestic U.S. markets. FERC”s response was that FERC would regulatory authority over domestic export to the U.S. market.

Scenario 3 was an in-state pipeline with North Slope gas being used in-state with some of the gas being exported to foreign markets. FERC’s response was that FERC would not have regulatory authority over North Slope gas exported to a foreign market.

FERC does not have regulatory oversight over North Slope natural gas exported to foreign markets. Therefore, the issue of FERC’s denial of Yukon Pacific’s permit to export North Slope gas from Valdez to the U.S. domestic market has no bearing whatsoever on Walker’s Valdez pipeline project.

Parnell knows that Walker’s Valdez pipeline plan is viable and economically sound. Cheniere, Inc.’s filing for an export permit to export domestically produced LNG to global markets further supports Walker’s contention that Alaska should export its natural gas to a global market rather than to an oversupplied U.S. market.

Rival Ralph Samuels has also lauded the FERC decision regarding the YPC permit as supporting his position that Walker’s plan is not viable. Obviously, in light of the response by FERC to the Parnell Administration’s inquiry, Samuels is wrong in his position. Samuels knows full well that FERC has domestic market oversight, not foreign, and that Walker’s plan is to export natural gas to Asia.

On the one hand, Parnell acts to withhold information, on the other, Samuels acts, as have others, to promote half truths.

The positions of the various candidates on the issues regarding the pipelines and the looming economic disaster facing the State would be illuminated at public forums where they would debate on the issues. Unfortunately, Gov. Sean Parnell has decided that he does not want to participate in any more debates until just before the Primary Election in August. He was put on the spot by Walker at the Kodiak Crab Festival on May 29th.

Walker asked Parnell about the $20,000,000,000 give-a-way that his refusal to sign SB 305 separating natural gas taxes from oil taxes will cost the State. This give-a-way amounts to a State subsidy for the Canadian route construction of AGIA or Denali. Both benefit from Parnell’s action. Apparently, Parnell chose to waffle and make polite noises rather than answer a direct question.

It appears that Walker’s growing support is making Parnell and Samuels a bit nervous in the service as it were.

Ralph Samuels steps in "it" . . .

In an interview with the Frontiersman, gubernatorial candidate Ralph Samuels pretty much damaged his hopes for a successful run against incumbent Sean Parnell or fellow Republican Bill Walker.

In what has to be one of the weirdest statements of any candidate to date on resource development issues Samuels opined:

“A larger diameter in-state gas line running from the North Slope to Valdez presents problems and not enough room for future growth to make it worth the $20 billion investment. First, there is no LNG plant in Valdez, and the plant in Nikiski already has the permit to export the commodity.

Second, and more disturbingly the known reserves in Prudhoe Bay are large enough to supply the pipeline to Valdez with gas for 70 years. This means future gas development is no longer necessary to make the line to Valdez pay off. Why would you go explore for more? You don’t want the (Valdez pipeline) because that’s all you get.” –Ralph Samuels 3/30/2010

I characterize this statement as weird, as this is the first time that any candidate has stated that too much gas is a problem. This is also the first time that any candidate has stated that having enough gas for a 70 year supply of gas to tidewater at 3 billion cubic feet per day is a bad thing.

Samuels’ statement means that his estimate of 70 years of jobs, industry from keeping our gas liquids in-state, and keeping the money and infrastructure in Alaska while exporting a reasonable volume of gas from the North Slope would be bad for an economy that is cooling with the continuing reduction in oil flowing through the Trans Alaska Pipeline.

How is this “long term thinking” on his part, much less demonstrating any business acumen?

It is obvious that Samuels ultimately favors sending most of the North Slope gas to Canada. He states:

“The gas supply on the North Slope is big enough to keep a bullet line operating without harming the prospects of a larger, out-of-state gas line.”

Looking at his list of contributors to his campaign is a list of whose who at Conoco-Phillips and Enstar.

Samuels is another of the give it all to the Canucks and to heck with Alaska and Alaskans. He intends to give Alaska’s resources away without demanding anything in return.
It is common knowledge that Conoco-Phillips/BP’s Denali project intends to supply gas to free Alberta tar sands oil at the cheapest cost possible, with Alaska’s gas liquids—propane, ethane, hexane, butane—going to Alberta’s petrochemical industry. Alaska would get the lowest price for its gas were Denali to happen.

The Valdez line option championed by Republican Bill Walker and mandated by Alaska’s voters in 2002 has all permits in place and the Environmental Impact Statements up to date for the LNG train and the impact of LNG tanker traffic in and out of Valdez and Prince William Sound. This is the only pipeline option for export of our gas to market that keeps the jobs for Alaskans, the infrastructure in Alaska, and our gas liquids for use in-state to build a petrochemical industry. AGIA and Denali, the other two export options benefit Canada, not Alaska.

Samuels’ record is as a 6 year legislator with 2 years as House Majority Leader. Samuel’s was a legislator who voted for the greatest increase in state budgets and a significant increase in the growth of State government. He lacks the credentials to qualify him as a fiscal conservative.

The problem with the bullet line from the North Slope to Port McKenzie in the Mat-Su Valley, is that 1. the route is not finalized, 2. any route being considered crosses 2 wildlife refuges, a federal national park, a state park, and 12 fish streams.

It took 8 ½ years for the Valdez line Environmental Impact Statement to be approved by the federal government. I guess Samuels figures he will just declare such done and that is all there is to the process?

The bullet line sounds like a great idea. Except, the cost of transporting the gas is figured on a volume basis. Further, the impact upon future development and exploration in Cook Inlet by 500mcf/da was unstated by candidate Samuels. In fact, he missed the boat regarding the ability to resolve the real problem with Cook Inlet gas supply.

The problem is the 10 years it takes to get a permit approved to do anything, and then the impact of further delays from specious litigation on the part of the environmental, no growth groups. The Alaska Regulatory Commission is a major impediment with respect to the time it takes to get any permits for exploration, development and improvements where Cook Inlet oil and gas are concerned.

Samuels is a walking statement for why it is necessary to reject the incumbents and prior and serving legislators this coming election. They are the problem, not any answer.

Alaska is in a very serious predicament financially and economically. Without a viable economy, which Alaska’s runs on oil and gas, there is no hope for our sons and daughters staying here. There will not be any jobs here for them, given Samuel’s lack of foresight and logic.

Look at Samuels’ website at http://www.samuelsforgovernor.com/ . Please, if you can find one statement about any position, let me know! This guy evidently stands for . . . leadership? That’s all he says. He says nothing on the website about his positions for anything. And, he wants to be governor of Alaska?

Please be informed this election.

For more information:
http://frontiersman.com/articles/2010/03/31/local_news/doc4bb161049c270431896290.txt

AGIA is dead but for the politics

Obviously, AGIA is not dead. However, the announcement Friday of a cost increase of an estimated $41B is not conducive to supporting a belief that either AGIA or Denali can be feasible economically. Especially, since the completion date is estimated to be at least 2020.

Given that costs of operations on the North Slope have risen 68% from 2001 to 2009, one can reasonably figure that AGIA’s costs will increase between now and any anticipated start date, say 2015. Since AGIA’s estimated cost was about $15B-$25B, depending upon the source during the Palin v. Murkowski campaign, one can estimate that the completed cost will be somewhere between $75B and $100B by estimated shipment of the first gas in 2020.

Shell announced that it is cutting back its expansion of production of oil from Alberta’s tar sands from a target of 700,000bpd to 225,000bpd for the foreseeable future. Shell will be shifting its emphasis to offshore and onshore exploration, something the company had not emphasized until a recent change in management. Increased cost in the reduction in the expansion of the tar sands recovery was cited as the reason.

It is my belief that AGIA is dead, given the shale gas production Outside and in Canada. Exxon spent $41B buying the company with the largest shale gas holdings in the U.S. One also has to remember that Exxon is committed to a 25 year commitment with Qattar to bring gas to the U.S. The expansion of LNG terminals in the U.S. to 4.5bcf is an interesting number, as that was the planned capacity of big diameter pipelines from Alaska to Canada to the U.S. Any introduction of Alaska gas at that rate would have a depressing effect on the price of natural gas in the region in which it is introduced.

There are those who believe that the President will not allow Alaska to export LNG. That given this belief, the all-Alaska pipeline would not be feasible as Alaska’s gas could not then be exported. This position is belied by the fact that Alaska has been shipping gas from Nikkiski to Japan for the last 40 years. Given this fact, the all-Alaska pipeline would have a market in Asia, primarily in Japan.

The big question now, is what will be the outcome of the AGIA Open Season? Will the producers step up to send gas to Canada? Not likely, for the reasons stated above. However, AGIA was flexible, with a 2.0bcf pipeline to Valdez as the LNG option. That option may see interest, as Asia offers higher prices to Outside markets now uncertain because of shale gas development.

The outcome of the AGIA Open Season will not be known until NOVEMBER, after the general election is over. This plays in the favor of Gov. Sean Parnell. However, if the arguments on the part of Bill Walker regarding the viability and benefits of the all-Alaska pipeline option continue to find favor with Alaskans, Gov. Parnell will need something substantive to show the people that AGIA will produce results before the August Primary.

It is obvious, with the filing of HB312, that Rep. Jay Ramras, Rep. Mike Chennault, Rep. Mark Neumann, Rep. Bill Stoltze, Sen. Lesil McGuire, Sen. Charlie Huggins are hoping to confuse the idea of the Noah Parks Highway 500mcf pipeline sufficiently to get the people to forget that we voted for the all-Alaska route back in 2002 and again in 2006 with the election of Palin/Parnell. These legislators forget that they have ignored the will of the people as egregiously as did governors Murkowski, Palin and Parnell.

The reality here is that although there was no announcement, AGIA’s viability is suspect, due to the doubling of the price tag over less than 4 years. That fact cannot be attractive to potential investors.

The only sure thing is the all-Alaska natural gas pipeline proposed by Bill Walker, and voted upon by Alaskans in two separate elections. That pipeline is permitted, and ready to begin construction. All it needs is a governor to lead the way.

Is ACES the problem?

I think something is being overlooked in this discussion. It is easy to blame taxes. And, one has to give a minor kudos to Parnell who alluded to a potential decrease in the State's royalty taxes. However, there is more here than just taxes.

One of the primary issues is the state of the national economy. There has to be a market to sustain the exploration and development. That the market is in decline due to Obama/Pelosi/Reid's disasterous attempt to rewrite the national economy paradigm. Yeah, GWB had his part in the making of this mess.

That situation definitely has an impact on what happens where with any industry, much less oil and gas.An indicator of the impact of the national economy is Shell's pulling back from oil tar sands recovery expansion from a planned 700,000bpd to 225,000bpd, including putting on hold a potential technology pilot project for insitu recovery. Cost of production is up--and it is here also, a 68% increase in operations costs on the NS from 2001. Therefore, it stands to reason that the oil companies are shifting their focus to portions of world that do not have the regulatory baggage--read nimby/greenie lawsuit--where it is cheaper to operate, even if the return is lower. Exxon and others bid on Iraqi concessions for around $1.40pb.

Shell is going forward with its offshore exploration, something the Parnell Administration seems to be hyping as the new oil rush. State gov't does not get as much directly out that development, but will gain from the jobs and infrastructure in the communities where support bases will be established. Unfortunately, the State is used to a "trickle down" economy where the revenue goes to the State directly and is then distributed to the smaller communities. This type of development, as well as mining will start to put the State back in its place and give new economic power to the communities impacted by the resource development--as it should be instead of this socialist state and colonial economy that is Alaska.

Given the reduction in the tar sands expansion on the part of Shell, it appears that AGIA and Denali may have lost a great deal of their appeal to the Canucks. I doubt those big pipe projects will survive.

This means that ACES is important to maintaining a bloated State gov't, which also feeds bloated local gov'ts. Reducing ACES is going to be a fight, given declining production on the NS.Should ACES be reduced?

Ireland reduced their taxes and boomed economically. Alberta and Saskatchewan played tug of war with the oil industry when Alberta increased its production royalties, and the oil companies bailed for Saskatchewan. Alberta figured the situation out quickly, and made up for lost drilling by lowering the royalty tax. Lowering taxes and royalties cannot be understated in terms of demonstrated positive impact.

Yet, when Parnell in his State of the State suggested that the State's royalty tax may be reduced, a good conservative pundit howled like a striped ape. Why, we just cannot do that!

The reality is that taxes are only one part of the problem in attracting the oil industry back to the State.

Taxes alone will not bring attention back to Alaska, a redress of regulatory impediments must also happen. Marathon Oil did not complain to the Anchorage Chamber of Commerce about taxes, they complained about the regulatory burden in aquiring the permits to drill new exploratory wells.

Calling for a reduction of ACES is only one aspect of what is needed to create a favorable environment for the oil/gas industry to reinvest in Alaska. A reduction in the royalty tax should also be looked at and weighed. However, the primary focus should be on the regulatory impediments. That's where the delays and the real money is lost to the oil companies and any resource development business trying to do business in Alaska.

In the mean time, we need to elect a governor who can move the State forward in the face of declining oil revenues and that candidate is Bill Walker. The all-Alaska pipeline will provide revenue, jobs and infrastructure that would allow the State to reconsider its policies regarding oil and gas development from a position of not having to knee jerk to demands that may be well intended, but might not have the end result desired.

Time to end the Alaska Parnell/Campbell show

Governor Sean Parnell’s new budget sticker price is a shocker. $10.5B. That’s billion with an explosive “B”. The size of this figure should give rise to fear and trepidation into the hearts of every conservative Alaskan out there, and the rest, also. Out of $10.5B, less than point 5 percent builds anything. The rest goes to State government to maintain the social State that Alaska has become while drunk on oil revenues.

When has there been any desire to build anything since Bill Eagan’s second term in the early 1970s? All State government does now is grow, and make excuses for why we cannot do anything anymore.

Worse, why has the State government grown with the Palin/Parnell Administration? As it turns out, Sarah was no conservative. She sold us a load of bilge on that promise, and Parnell has yet to pump out the bilge water that is the growth in State government since Palin/Parnell came to power. The current increase of 8.6% over Palin’s last budget shows that Parnell is no fiscal conservative.

An example of the expansion of State government is Palin/Parnell’s Climate Change Sub-Cabinet. A State executive cabinet that is managed by a federal EPA employee. This management is contrary to the Palin/Parnell stance and rhetoric in Sean’s State of the State address about maintaining and protecting the State’s sovereignty. This cabinet is no longer needed with the admission of climate change being manufactured science to a political end.

This sub-cabinet is also an expansion of government whose function was already covered by DEC, DNR, DMVA on the emergency response side, and other State agencies. Worse, it is administered by Climate Change Strategies, an NGO that promotes the false science of man-made global warming.

Another duplication of effort and money, to the tune of $7 million this year, was the creation of the Pipeline Czar position under Palin and continued by Parnell. We created ANGDA in 2002 by an overwhelming majority to do exactly what Noah and now Bob Swenson were appointed to do. Why is this bureaucracy and expense necessary? What does it do that ANGDA could not do, especially in the face of former Sen. Gene Therriault’s appointment as the governor’s oil and gas advisor? Seems to me that between Therriault and ANGDA, the situation regarding gas pipelines was covered.

DMVA continues an interesting structure that is contrary to our republican tradition in government. The military always has a civilian head. In Alaska, under former Gov. Frank Murkowski, an experiment was tried. The Commissioner DMVA and the position of the Adjutant General were combined. The purpose was to put the two top jobs, military and civilian under one hat. While good in theory, it put the military in control of DMVA, or more particularly, the National Guard Bureau (NGB). The reorganization also resulted in the two top positions being out of State at the same time. With then MG Craig Campbell’s numerous trips to Mongolia, Iraq, and Afghanistan as TAG, DMVA’s remaining leadership was incapable of making any decisions while the Commissioner/TAG was out of town. The Commissioner DMVA should be a civilian, and the TAG should be military, as two separate positions. NGB fuels DMVA. The combination of TAG and Commissioner under one hat gives the feds too much influence. Parnell, as a long time legislator, should have had the moxy to correct this situation. The military should always have civilian leadership. Even the Russians know better.

Under Parnell, we have bigger not better government. We have more money spent with less to show for it. We are in a recession, not a period of growth. There is no pipeline or other major construction on the Parnell plate with an anticipated start date planned. It is time to wipe the slate clean of Palin/Parnell and elect a new governor.

We cannot afford another round of Palin/Parnell.

Note: My choice is Bill Walker. I voted for the all-Alaska pipeline in 2002. I contributed, campaigned and voted for Palin/Parnell because of Sarah's support of the all-Alaska pipeline. I have studied and read extensively on the options, and there is only one option for Alaska: the all-Alaska pipeline, and Bill Walker for Governor: www.billwalkerforgovernor.com Otherwise, why are the Canucks building a LNG export facility at Kittimat, B.C.? Why have there been permits filed to build 2 other export LNG facilities on the West Coast of the U.S.? Shale gas has changed the game. Alaska has to figure it out or lose opportunity, jobs and suffer the continuing rape of our resources.

Walker Responds to Parnell's State of State Address

Follows is Bill Walker, Republican Candidat for governor's response to the Gov's State of the State address. Parnell's address can be viewed at :
http://www.examiner.com/x-2968-Alaska-Gubernatorial-Examiner~y2010m1d21-Gov-Parnells-State-of-the-Union-Address


FOR IMMEDIATE RELEASE

BILL WALKER RESPONDS TO STATE OF THE STATE ADDRESS

January 20, 2010

Today Bill Walker released the following statement regarding Governor Parnell’s state of the state address.

“With his support of AGIA, Governor Parnell continues to ignore the economic realities of a changing world. While he recognizes that bringing Alaska gas to market is the biggest opportunity ahead of Alaska, he has committed to stay the course in a process that everyone knows will fail.

As an Alaskan, I am deeply troubled by the Governor’s willingness to place our fragile future in the hands of outside interests and foreign governments. If the State does not take control of the process and construct an all-Alaska pipeline to Valdez there will not be a gas pipeline.

The Governor’s “permit and they will come approach” has repeatedly failed to secure an Alaska natural gas pipeline. Both TransCanada predecessors in the 1980’s for a line through Canada, and the Yukon Pacific Corporation in the 1990’s for an All-Alaska project, expended hundred of millions of dollars securing final regulatory approvals hoping to attract producer participation with that strategy. It failed then and will fail now.

Further, since AGIA passed, the U. S. Department of Energy has estimated that the United States has sufficient gas for the next 100 plus years due to recent proven shale gas reserves. Yet the Governor continues to tell the people of Alaska that there is demand for our gas in the lower-48, even going as far as to suggest we will soon become American’s next great ‘gas province.’ Let me be clear – his misrepresentation of the facts about shale gas is beyond out of touch, it is out of line.

Planned gas import terminals in western Canada have reversed course and are now being developed as gas export terminals (Kitimat, B.C.). Billions are being spent to ramp up production all across North America in the newest energy gold rush, and Exxon Mobil has even acquired the second largest shale gas company for $41 billion. Companies, states and countries have reacted around the globe, yet we continue to pursue the AGIA process knowing it charts a course into Canada that leads nowhere.

As governor I will keep Alaska’s jobs, gas and future within Alaska, develop a pipeline on our timeline and under our control, and will sell Alaska gas to world markets. Our Gas, Our jobs, Our Future.”