Morning Headlamp – “A monkey fight inside a clown car driving into a dumpster fire.”

Destroying a village to save it. Hats off to Andrew Jensen at the Alaska Journal of Commerce for another practical look at what’s really happening in Juneau. If you read one story this morning, make it his.

Budget deal “imminent.“ Alaska House and Senate leaders took a major step Wednesday toward averting a July 1 government shutdown by agreeing to an $8 million cut to the state university system — a move members said brings them close to a budget deal. “We still don’t have a deal. But I think a deal is imminent,” said Bethel Sen. Lyman Hoffman, co-chairman of the Senate Finance Committee and the sole Democratic member of his chamber’s Republican-led majority.

Headlamp will be watching the conference committee at 10am today to see how the final key details are handled: education funding, draws from the Earnings Reserve Account and Constitutional Budget Reserve and the Oil and Gas Tax Credit Capitalization Fund. 

Stormy Weather. Tropical storm Cindy  has shut one-sixth of the oil production in the Gulf of Mexico, halted vessel unloadings at a major oil-import terminal and triggered a force majeure on a system that collects natural gas from offshore platforms. Once Cindy makes landfall, it could threaten to disrupt even more energy operations in a region that accounts for about half of the nation’s oil-refining capacity. “The biggest impact would be on shipping activity which will remain suspended through Friday,” said Andy Lipow, president of Lipow Oil Associates in Houston. “Storm sets off high winds and waves that will impact ability of ships to go through open water.”

Pigs in the Pipeline. June 30 is a big anniversary for one of the most famous pipeline systems in the world. The Trans-Alaska Pipeline is 40-years-old. Alyeska engineers are working to make sure more anniversaries are celebrated. Hats off to Admiral Barrett and the team at Alyeska for dedicating their careers to protecting and maintaining the lifeblood of Alaska. Headlamp wishes you all a very Happy Birthday! 

Here comes the judge. Oil will continue to flow through the Dakota Access Pipeline through the summer while authorities conduct additional review of the environmental impact, after a judge on Wednesday ordered more hearings in coming months. Last week, U.S. District Court Judge James Boasberg in Washington ruled in favor of Standing Rock Sioux and Cheyenne River Sioux tribes, who said more environmental analysis of the Dakota Access line should have been carried out.

How do you like 10% unemployment? Kristina Andrew greets Nick Harvey as he steps into the Sustaining Bristol Bay Fisheries booth at the Dillingham harbor. He’s hoping to buy a “No Pebble Mine” flag for his boat to fly. Andrew, the director of Sustaining Bristol Bay Fisheries, is out of flags, but Harvey agrees to sign a letter to the Environmental Protection Agency instead. The letter is addressed to Environmental Protection Agency administrator Scott Pruitt. It expresses disappointment that the EPA and Pebble Limited Partnership recently reached a settlement that will allow the Pebble project to proceed into a normal permitting process. Headlamp is thrilled that that Pruitt is following the law and allowing a project to proceed through the established process. 10% unemployment in Dillingham won’t be reduced without responsible resource development. But we sure appreciate Nick Harvey’s interest in keeping responsible resource development out of the Bristol Bay area; his willingness to deny the region economic freedom as long as he can fish there is interesting. Headlamp notes Harvey lives in SEATTLE. 

Softer Blow to UA System. The state Legislature’s conference committee cut $8 million from the University of Alaska’s budget on Wednesday, a softer blow than the nearly $22 million reduction proposed by the state Senate. The six-member committee approved the UA budget without discussion at the meeting early Wednesday evening. Under the approved UA operating budget, the university system will receive $317 million in state funding for 2017-18, down from the $325 million it got in the current fiscal year.

Hilcorp Doubles Down On Cook Inlet. Hilcorp spent over $3 million for exploration rights to 14 federal offshore leases covering about 76,615 acres in Cook Inlet. Hilcorp, the dominant Cook Inlet oil producer, was the only company bidding in the U.S. Bureau of Ocean Energy Management’s lease sale held Wednesday. It was also the only company bidding in a state Cook Inlet lease sale held earlier Wednesday, picking up six tracts for a total $922,392.30 in bids, according to the Alaska Division of Oil and Gas. “This lease sale is good news for the future of affordable energy in southcentral Alaska, and a good sign for our ability to develop more of the prolific resources in Alaska’s OCS,” Senator Lisa Murkowski said. “I appreciate the new administration’s decision to move forward with this sale, and hope it marks the return of regular sales that restore access to more of our federal waters.”

 

First Reads

Alaska Senate leader: Budget deal to avert shutdown ‘imminent’
Alaska Dispatch News, Nathaniel Herz, June 22, 2017

University of Alaska budget cut by $8 million in legislative compromise
Alaska Dispatch News, Tegan Hanlon, June 22, 2017

Hilcorp makes industry’s first move in decades into federal waters of Cook Inlet
Alaska Dispatch News, Yereth Rosen, June 22, 2017

Storm Cindy Bears Down on Gulf Coast After Curbing Oil, Gas
Bloomberg, Brian K Sullivan, June 21, 2017

Oil to keep flowing in Dakota line while legal battle continues
Reuters, Pete Schroeder, June 22, 2017

AJOC EDITORIAL: Democrats destroying the village to save it
Alaska Journal of Commerce, Andrew Jensen, June 21, 2017

Advocates opposed to mining in Bristol Bay region ramp up summer outreach
Alaska Public Media, Avery Lill, June 21, 2017

Alyeska Pipeline is trying to engineer their way out of low oil flow in TAPS
KTVA, Emily Carlson, June 21, 2017