The AGDC board of directors met at Kenai’s Cannery Lodge last week to discuss work on the Alaska LNG Project and recent gas marketing efforts in Asia. Since an analysis from consulting firm Wood MacKenzie was presented to the Legislature in August showing the Alaska LNG Project as one of the least competitive LNG projects in the world at present and the three producer partners on the project — BP, ConocoPhillips and ExxonMobil — announced they would step back from making further investments, the state has been working out how to transition the completed assets from the project so the state can press on. The board hopes the transfer of the projects assets to wrap up by the end of the year. Again, Headlamp questions the idea of government leading a project that is consider one of the LEAST competitive in the world.
“I think it’s something the state really owes its people, to look at what does it really look like if you just stop? What if you don’t do this project? What if you don’t ever have a gas pipeline? What if you just let the oil run dry?” AGDC President Keith Meyer said. “…If you really look at the two paths, the two choices, either do it or not, I believe having a project will be much more beneficial to the state than not having a project.”
From Russia with love. President Vladimir Putin’s government has just set a draft budget for the next three years based on the assumption Russia will be able to sell its oil for $40 a barrel. That’s $10 below current world prices. It amended the budget earlier this month, to accommodate higher defense spending and a one-off bonus for pensioners to be paid in January. That will push up borrowing: the budget deficit is now expected to reach 3.7% of GDP, well above the official target of 3%. Experts are skeptical whether the country will be able to stick with the plan. “Russia’s inability to stick to a fiscal plan even over the course of several months undermines the spending and deficit targets for 2017 and beyond,” analysts from the Eurasia Group wrote in a note.
A panel of experts gave their views on the shifting supply-demand balance, which is bolstered by more takeaway capacity to Mexico and via newly opened terminals on the Gulf Coast. Four panelists, including one from Canada, expressed different views about what was unfolding, but all agreed that the supply-demand picture will be quite different by the end of next year, not to mention the next 10 years, during the LDC Gas Forum Rockies & West conference. “I’ve never seen such a bipartisan effort, including the Western Slope producers, local officials, the governor and Congressional representatives, joining forces and making an all-out effort to mount support in Colorado to help the Jordan Cove project move forward,” Colorado-based Andrew Browning, COO of the Consumer Energy Alliance, said.
Help us spread the word! Tell your friends, colleagues, family and more to sign up today for the latest in AK energy, politics and industry. Subscribe to AK Headlamp here: http://bit.ly/1OdpLVY
AGDC meets in Kenai
Peninsula Clarion, Elizabeth Earl, October 16, 2016
Russia is planning for low oil prices for years
WCVB, Ivana Kottasova, October 15, 2016
Natural Gas Intel, Richard Nemec, October 13, 2016
As economy loses steam, Alaska’s major shippers report import declines
Alaska Dispatch News, Jeannette Lee Falsey, October 15, 2016