Sunday, October 14, 2012

Alaska's oil companies are not Satan

Deborah Brollini, Technical Writer
Alaska Energy Dudes and Divas

There is nothing like corresponding with Alaskans who are working in North Dakota begging me to come home. In the past my head would be exploding. However today, these types of correspondence only fill my heart up with sadness. One Alaskan mentioned that he is returning to Alaska for the Thanksgiving holiday to visit and not to live and work in a state that he loves. He asked me on Friday “is the state going to get it together this session?” All I can do anymore is to promise these Alaskans that there are people like myself who are working for long-term oil tax reform, and to bring Alaskans home.

It is unfortunate that Alaska’s oil tax debate has turned into a long painful episode of the Real Housewives of New Jersey while the whole world is watching, and it is downright embarrassing. We live in a world-class oil province and you would think that Alaska would start acting like it, think more maturely, strategically and with vision in order to provide future generations the same opportunities the rest of us have enjoyed due to our oil wealth.

Senators Hollis French, Wielecowski, and Paskvan have made statements that the oil companies will never leave Alaska. That is a pretty arrogant thought process, and a huge gamble with the lives and livelihoods of 710,000 Alaskans. Especially, when these Senators have only proposed oil exploration giveaways to exploration companies whom are non-taxpayers, and have not delivered one new drop of new oil into the Trans Alaska Pipeline (TAPS), or one new penny into state coffers since 2007. Not exactly what one would call a long-term plan to sustain our state financially for years to come. Exploration is important and should be supported. However, exploration should not be the priority. The priority should be increasing oil production within existing fields today, and keeping (TAPS) above 500,000 barrels per day.

Alaskans are being led down this road to think that the oil companies are Satan, not hiring Alaskans, and not producing oil; not true. The oil producers are not exploring for oil because they already know where the oil is, and they are sitting on billions of barrels of it. However, this next generation of oil which is viscous and heavy oil is hugely expensive to extract, and will take billions of dollars of oil company dollars to invest in new technology and talent to bring this oil to market. BP has invested over the past several years in a heavy oil pilot project, and there is no guarantee that that this project will be funded in the future if Alaska does not get its act together. Alaska’s future is heavy and viscous crude. However, the priority needs to be bringing more light oil online through projects within existing oil fields while continuing to invest in viscous and heavy oil to make this next generation of oil economic for the oil companies, the state of Alaska, and our citizens.

Alaskans need to understand that Alaska's oil companies, and the state of Alaska's futures are linked, and how are we going to work together so all parties benefit. I was watching an old 1992 Presidential debate, and one of the lines that resonated with me (in regards to the future of Alaska) was "are we in it to win it?" I think with the right leadership we can all win.