Morning Headlamp – Legislators leaving town without their work done?

Shutdown averted – now what? Despite passing stop-gap measures and averting a state-wide shutdown of government services, the Alaska Legislature’s special session continues until July 16, though most lawmakers say they are done for now. They were packing up Friday for their home districts. Legislative leaders wanted to adjourn but Walker told them to keep working, said Sen. Lyman Hoffman, a Democrat from Bethel who is part of the Republican majority and one of the architects of the budget deal. That means they will hold what’s known as technical floor sessions every few days with only a few members. Lawmakers have yet to pass a capital budget, but say they will get to that eventually, maybe in another special session. Capital projects such as roads and buildings won’t shut down if that budget isn’t approved by July 1, said Hoffman, who co-chairs the Senate Finance Committee. The operating budget now goes to Walker, who can veto or lower any of the spending particulars. Last year, Walker vetoed more than $1 billion in spending, most of it for dividends. Late Thursday night, Walker added one more item of unfinished business to the Legislature’s agenda for the special session. Some lawmakers said they expected it to be the capital budget, but in fact Walker said he wanted them to address the state’s “unsustainable oil and gas tax credit system” through House Bill 111. The bill could end payments of cash tax credits to oil companies, though about $1 billion from the past is still owed. Both chambers want to end those tax breaks. But the House also wants to increase the effective tax rate on oil.

If you build it…The energy infrastructure deficit is preventing the US from achieving energy independence as East Coast and West Coast markets continue to rely on imported oil due to a shortage of pipelines moving oil from US shale fields to refineries, writes David Gaffen. To achieve energy independence, the US must expand and upgrade its aging pipeline.

It’s a First!  Lithuania buys US LNG – Lithuania’s state-owned gas trader Lietuvos Duju Tiekimas (LDT) said on Monday it had signed a deal to buy liquefied natural gas (LNG) directly from the United States for the first time and expects to receive a delivery in the second half of August. The deal is with a unit of Cheniere Energy and is part Lithuania’s efforts to diversify its gas suppliers and reduce its reliance on Russia’s Gazprom. LDT, part of state-owned energy group Lietuvos Energija, signed a deal last year with Koch Supply & Trading for LNG supplies throughout 2017.  Cheniere Energy was expected to supply LNG from a U.S. field, an LDT spokesman told Reuters. “It will be the first time Lithuania imports gas from the U.S.,” he said.

Qatar back in the game. Iran’s rapid development of the shared North Field has caused Qatar to lift its 12 year development moratorium on the field.  Production has been averaging around 20 billion cubic feet a day.

Boroughs depend on State more than a decade ago. The average share of revenues a borough received from the state more than doubled between 2005 and 2015, from about 12 percent to 28 percent. There are three main kinds of state aid to communities: general government operating money, public works project grants, and school aid. These are the main findings in a new report released this week by the Institute of Social and Economic Research at the University of Alaska Anchorage.

First Reads

Alaska borough governments depend much more on state money now than a decade ago
Alaska Dispatch News, Annie Zak, June 26, 2017

The Alaska Legislature passed a budget and avoided a government shutdown. What happens now?
Alaska Dispatch News, Lisa Demer, Tegan Hanlon, June 26, 2017

Alaska’s 40 Years Of Oil Riches Almost Never Was
NPR, Elizabeth Harball, June 24, 2017

ANALYSIS-Clogged oil arteries slow U.S. shale rush to record output
Reuters, David Gaffen, June 26, 2017

Lithuania signs first deal for U.S. LNG
Reuters, Andrius Sytas, June 26, 2017

Qatar’s foot off the brake
Petroleum Economist, Gerald Butt, June 20, 2017