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Feb. 7 update: Alaska is losing investment opportunities

Alaska losing out on world-wide investment boon


Thanks to new investment, Texas’ legacy fields continue to produce a century after discovery

It’s happening around the world – except in Alaska. Old fields roaring back to life thanks to new technology funded by new investment and above average oil prices.

In tax friendly North Dakota, production has soared from 123,620 barrels a day (bld) in 2007 to 639,277 bld last year.

Alaska’s production fell more than 100,000 bbl during the same period.

While in tax friendly Texas, which has been producing oil since the 1860s, daily production has grown from 921,000 barrels to 1,233,000 barrels over the past five years.

The North Sea, which is about the same age as Prudhoe Bay, is undergoing a renaissance. “The expansion has been spurred by record-breaking levels of investment, with about 40 billion pounds set to be ploughed into North Sea production in the next three years,” reports The Independent, a national British newspaper.

“The surge in investment comes after the government relaxed the tax regime around North Sea development, prompting a record-breaking licensing round when the Department of Energy and Climate Change awarded 167 new licenses on 330 blocks last October.”

“Industry body Oil & Gas UK said the Chancellor’s promise of certainty on decommissioning tax relief and new tax breaks on small and deepwater fields would stimulate tens of billions of pounds of additional investment,” wrote a British trade publication.

“The tax break could cut the bill for companies operating older oil and gas fields by as much as 160 million pounds,” according to The Telegraph Media Group.

“It is estimated it will cost the Government around 100 million pounds in lost tax revenue initially but politicians expect the long-term benefits of more production from the North Sea to ‘significantly outweigh’ this.”

Billions in new investment pour into North Sea as Britain cuts taxes for second time.

“It is estimated it will cost the Government around 100 million pounds in lost tax revenue but politicians expect the long-term benefits of more production from the North Sea to ‘significantly outweigh’ this.”
 
 

  Memorable quotes

 

“Investment matters because less than half of the oil considered recoverable from the North Slope has been produced to date.”

Barry Pulliam, Econ One Research

 

“This is a war for the hearts and minds of Alaskans. This is a war for Alaska, and as a woman who survived the crash of Alaska's economy of 1986, I'm not at all interesting in repeating the experience.”

Deborah Brollini, Energy Dudes and Divas

 
 

“The biggest threat to Alaska’s revenue stream — that 92 percent revenue stream — is the decline of production that produces that revenue of for the state.”

Sen. Peter Micciche

 
 
 

 
 

 

Thanks to everyone who testified

A big thanks to everyone who took time out of their busy lives to present comments Jan. 24 to the Special Senate Committee on TAPS Throughput.

Twenty-one supporters made comments, most of whom are business people or representatives of organization that represent thousands of Alaskans.

Supporting the status quo “take away” were 10, all of whom testified personally, and did not represent a group of employees who count on a healthy private-sector economy.

When you next see these folks, tell them “thank you for standing up for Alaska:”

To watch the hearing, click here.

Jan. 24 testifiers in support of oil tax reform
  • Scott Thorson, Network Business Systems;
  • Dave Cruz, Cruz Construction;
  • Jeanine St. John, Lynden;
  • Ethan Schutt, Cook Inlet Regional Corporation;
  • John Sturgeon, Koncor Resources;
  • Aves Thomspon, Alaska Trucking Association;
  • Deantha Crockett, Alaska Mining Association;
  • Jim Scherieble, Kenworth Alaska;
  • Barbara Huff-Tuckness, Teamsters’ 959;
  • Marty Mativa, Mat-Su Resource Conservation & Development;
  • Jim Plaquet – Fairbanks Alliance;
  • Brad Chastain, WHPacific;
  • Joe Mathis, NANA Development Corp.;
  • Steve Pratt, Consumer Energy Alliance;
  • Grant Johnson, Personal;
  • Michael Jespersen, Personal;
  • Dan Kennedy, CPA in Wasilla, former Wasilla Chamber of Commerce president;
  • Laurie Fagnani, MSI Communications;
  • Deborah Brollini, Personal;
  • Tara Sweeney, ASRC;
  • Laura Maketa, Mak 3 Construction.
 
 
 

Catch us on the air

MACC is airing a new radio spot this week. Listen to it here.

 

This week’s calendar

Friday, Feb. 8
9 a.m. – House majority Q&A, Gavel-to-Gavel or alaskalegislature.tv
1 p.m. – House Resources Committee, Gavel-to-Gavel or alaskalegislature.tv
3:30 p.m. – Senate Resources Committee, Gavel-to-Gavel or alaskalegislature.tv

Saturday, Feb. 9
10:00 a.m. – TAPS Throughput Committee, Gavel-to-Gavel or alaskalegislature.tv
(only if needed to finish hearing SB21)

Monday, Feb. 11
1 p.m. – House Resources Committee, Gavel-to-Gavel or alaskalegislature.tv

Thursday, Feb. 12
10 a.m. – House Democrats Q&A, Gavel-to-Gavel or alaskalegislature.tv

Wednesday, Feb. 13
10 a.m. – Senate Democrat minority press conference, Gavel-to-Gavel or alaskalegislature.tv
1 p.m. – House Resources Committee, Gavel-to-Gavel or alaskalegislature.tv

 
Make Alaska Competitive Coalition
3501 Denali Street #202, Anchorage, AK 99503 : 907.569.7070 : © 2013 Make Alaska Competitive Coalition

 

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