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OPEC Price Increase Means Potential Business for Alaska

Morning Headlamp, November 29, 2016


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OPEC share of world crude oil reserves in 2015.

Graph: Organization of Petroleum Exporting Countries

According to KTVA, AGDC hopes to transition the AKLNG project by the end of the year, as Alaska continues moving forward with the most expensive natural gas project in North America. "I think it's going to be a great time to be developing an infrastructure project or energy project in this nation and certainly in this state," AGDC's president Keith Meyer told industry members at a Resource Development Council (RDC) meeting earlier this month.

 

"If we're going to have a gasline, it's going to require the market," Gov. Walker said at the RDC conference. "That's going to determine if there's going to be one. We can't engineer our way into the economics."

 

"I remain a skeptic on the state takeover of the AKLNG project," said Rep. Geran Tarr, who's slated to serve as co-chair of the committee in the House's new, Democrat-led majority. "We'll need to be very careful about whether we move forward and if this is the right time." "It can't be some hoped-for thing," said Rep. Andy Josephson. "It's got to be more refined and well developed, or the state must, I think, shelve this largely and wait until a better day, a better price."

 

On the verge of OPEC price increases, Asian markets may begin to look somewhere else. According to Reuters, OPEC meets on Wednesday to hammer out a deal to prop up prices that have halved since 2014. As they gather, tanker shipments to Asia from non-OPEC sources like Alaska, Azerbaijan, and the North Sea are growing, according to shipping data. "Asian (oil) dependence on the Middle East is higher than they are comfortable with," said Bill Walker, Governor of Alaska, speaking during a recent visit to Japan. "They'd like to see something coming out of the U.S. We have seen some shipments come over (to Asia) and I think we are going to see more."

 

A Happy Thanksgiving from Hilcorp. Since Hilcorp came to Alaska they have gained a reputation for knowing how to get oil and gas out of an aging oil field — and how to keep the tradition of Thanksgiving and appreciation for our senior citizens by continuing a free pre-Thanksgiving turkey dinner at the Kenai Senior Center. It was a full house at the Kenai Senior Center last Tuesday with nearly 300 meals being served. "It was an absolute world class meal and no one went home hungry today that's for sure," smiled Lori Nelson, Hilcorp's External Affairs Manager. Regarding the future and the coming year for the energy industry in the Inlet, Nelson said, "We're an eternal optimist. Our niche is taking over mature assets and that's primarily what Alaska is now a mature basin and we are excited about the opportunities that exist not only here in the Cook Inlet but on the North Slope as well." As seniors left for home it was with many hugs, thankful hand-shakes, smiles of appreciation and good wishes for Hilcorp's continued success.

 

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First Reads

Legislature's optimism for gasline wanes, project lags behind schedule
KTVA, Liz Raines, November 28, 2016

As OPEC price hike looms, Asia's big oil buyers may shop elsewhere
Reuters, Henning Gloystein and Yuka Obayashi, November 29, 2016

Hilcorp serves up Thanksgiving dinner
Peninsula Clarion, November 28, 2016

Norway plans $1.15 billion order for five Boeing Poseidon military aircraft
Reuters, November 28, 2016

Oil and gas mergers and acquisitions are finally making a comeback
CNBC, Tom DiChristopher & John W. Schoen, November 28, 2016             

AK Headlamp
A project of the Alaska Support Industry Alliance
3301 C Street
Anchorage, AK 99503

 

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