Morning Headlamp — Lawmakers “work toward the middle” on oil tax

Mark Cotham, a Houston-based attorney, was hired by the Department of Law in July 2015 as a contract attorney with expertise “in obligations of oil and gas lessees to develop leases,” Cotham testified to the Legislative Budget and Audit Committee in 2005 that he was “struck” by the lack of discussion about the producers’ requirement to develop and sell natural gas from state leases in his research into the relationship between the State of Alaska and the North Slope producers. Cotham wrote an opinion column in 2006 for the Juneau Empire entitled “My turn: Speaking in terms Big Oil can grasp: Lease cancellation threats may get companies talking.” Headlamp notes that Cotham is firmly in the “duty to produce” camp, which stands on dubious legal grounds – at best.  Bringing him on amid concerns over the health of the industry and the future of the AKLNG project are curious – at best.  Headlamp predicts that this is part of the Governor’s strategy to attempt to “go it alone” on an LNG project.  

We’re trying to work toward the middle,” Rep. Paul Seaton said, referring to the talks on oil taxes. The middle of what exactly? Anywhere Alaskan lawmakers land on HB247, short of full rejection, will result in threatening thousands of jobs, billions in investment and no new production. 

Robert Papp, the State Department’s special representative on Arctic issues, lamented Shell’s Arctic pullout in an April 25 Brookings Institution event marking the first year of the U.S. chairmanship of the Arctic Council. “I’m worried that it’s reduced the sense of urgency,” Papp said in response to a question about Shell, the first posed to him during the Washington, D.C., forum. “I am discouraged that Shell is not going to be drilling up there in the near future because it was a visible—something that really drew a lot of attention, which provided that sense of urgency to act.” Private sector or public sector, Arctic issues are Alaskan issues. Headlamp agrees with Papp’s Arctic concerns.


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First Reads

AG hires lawyer who advised threatening leases
Alaska Journal of Commerce, Elwood Brehmer, May 3, 2016

With Shell gone from the Arctic, US official fears fading attention to the region
Alaska Dispatch News, Yereth Rosen, May 4, 2016

Russia’s Yamal LNG gets round sanctions with $12B Chinese loan deal
Alaska Dispatch News, Vladimir Soldatkin, May 4, 2016

At overtime halfway mark, GOP lawmakers ‘working toward the middle’ on oil taxes
Alaska Dispatch News, Nathaniel Herz, May 3, 2016