Oil and Gas in the 49th State: Hope on the Horizon
Alaska was purchased by the United States more than 150 years ago, due in part—even then—to an understanding of the state’s significant potential. When Alaska was under consideration for statehood, one of the arguments to welcome what would become the 49th state was this land’s almost unfathomable resources. The Trans Alaska Pipeline System, since its completion, has served as an economic artery for the state, with oil and gas building our industries and our communities. Historically in Alaska, as oil busts we hurt, and as it booms we prosper.
The oil and gas industry, through direct and indirect jobs, remains a key part of Alaska’s economy. Policy, production, tax credits, and price weigh heavily on the minds of all involved in this vast and complicated industry. What’s the next great discovery, or is there one? Even if there is, will it be economic for production? Alaska’s most recent oil finds are still in development infancy with no guarantee that they will translate into additional oil in the pipeline. While state government wrings its hands and worries over budget, what investments are on the horizon to ensure oil and gas companies continue to explore and invest?
Despite questions and uncertainty, it’s important to take note of the progress Alaska is making toward continued and increased production coursing through TAPS and the cautious optimism and forward-looking attitude of the industry as a whole.
With gas prices inching above $60 per barrel, there is hope on the horizon.
“Higher oil prices offer a bit of relief for Alaskans worried about the state’s finances,” said Kara
Moriarty, AOGA president and CEO, in a March statement. “Of course, a serious budget gap remains, but we are calling attention to the 100,000 additional barrels of oil moving down the pipeline than was forecast under the last oil tax law, called ACES. In the FY12 and FY13 production forecasts, analysts predicted oil production would plummet a full 100,000 barrels below today’s projected number. It is not difficult to figure out why state experts became optimistic about future oil production since the tax law changed in 2013—policy matters, and a smart, competitive policy caused companies to invest billions in Alaska.”
In this issue of Alaska Business we explore how oil and gas companies are using those investments to discover and implement high-tech techniques to increase worker safety, reduce costs, and increase access to locations that would otherwise be inaccessible.
We also feature some of the cutting-edge techniques being used to develop more efficient technology to prevent and clean oil spills… technology that ranges from infrared and satellite imaging techniques and advances in oleophilic skimmers to the use of bomb-sniffing dogs and Alyeska’s new fleet of purpose-built ships.
And, of course, we present the Oil and Gas Directory, a comprehensive listing of the oil and gas companies operating in Alaska and the support services that help keep them moving forward.
Also in this issue we visit some of Alaska’s rural villages to learn how pregnant women remain safe and healthy, even when visiting a doctor means taking a boat, a plane, or an ATV. It’s not as simple as a call to the OB-GYN when you’re hundreds of miles from the nearest hospital.
And we make a visit to the Seafood Expo in Boston to learn about the dangers of illegal offshore fishing and what can and is being done to keep Alaska’s fish in Alaskan hands.
It’s an exciting time for Alaska as we head into (almost) everybody’s favorite season when the light rarely fades and Alaskans hit the road (or river, or runway, or trail) to find adventure and play hard.
So take some time, peruse the pages, and enjoy the sunny days ahead.
—Kathryn Mackenzie, Managing Editor, Alaska Business