According to a Alaska Journal of Commerce commentary from BlueCrest Energy president CEO Benjamin Johnson, “the governor has not saved a dime for the state, and — with one stroke of his red pen — has instantaneously demolished the State of Alaska’s credibility among worldwide financial institutions and with potential oil industry partners who could be essential to the state’s future.” Citing Gov. Bill Walker’s recent veto of the state’s oil and gas tax credit program, Johnson argues that, “the credits have been successful in bringing new players to the state, with new projects launched, jobs created, and new oil and gas discovered and produced. Now, only when the political landscape is challenging, the state is backing away from its own policy, even when it is working as intended.” Headlamp applauds Johnson for stating the facts. Oil and gas tax credits were accomplishing exactly what they were created to do—incentivize business in Alaska. The future of private sector interest in the state looks bleak due to Gov. Walker’s decision.
Murkowski spins many plates in DC. The Energy Policy Modernization Act is in conference committee to stitch U.S. House of Representatives and Senate versions together after approval on July 12. Sen. Lisa Murkowski, as chairman of the Senate Energy and Natural Resources Committee, will serve as the conference committee’s chair along with six other senators: John Barrasso, R-Wyo.; Jim Risch, R-Idaho; Sen. John Cornyn, R-Texas; Maria Cantwell, D-Wash.; Sen. Ron Wyden, D-Ore.; Sen. Bernie Sanders, I-Vt. “While we have differences to resolve, I am confident we are up to the task,” said Murkowski in a statement. “Our bicameral negotiations will begin immediately so that a good final bill can be signed into law this year.” Murkowski has acknowledged in the past that President Barack Obama’s administration had only lukewarm support for the Senate version, but said that the Secretary of Energy is helping her office write language for the bill’s LNG permitting aspect illustrates the administration’s willingness to accept certain provisions. Headlamp applauds Senator Murkowski for her diligent efforts to pass legislation that helps to secure a strong energy future for the nation…and Alaska.
Moody’s Investors Service downgraded about $300 million of NANA Development Corp.’s corporate family debt rating from Caa1 to Caa2 on June 30. In fiscal year 2015, which ended Sept. 30, NANA Regional Corp. had a total loss of $23.9 million. NANA Regional lost $81.7 million and did not pay a dividend in fiscal year 2014. The downgrade from Caa1 to Caa2 is equivalent to a change from the AA+ to AA ratings used by other ratings agencies, and the Caa3 rating aligns with an AA- rating. The downgrade was driven by “significant deterioration” in NANA Development’s core businesses, namely the company’s oil and gas segment, according to the Moody’s report. The administration and the legislature should take note. Their actions can either strengthen or weaken the private sector.
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Conference committee formed on Murkowski’s energy bill
Alaska Journal of Commerce, DJ Summers, July 13, 2016
COMMENTARY: Veto of tax credit payments damages Alaska
Alaska Journal of Commerce, Benjamin Johnson, July 13, 2016
NANA debt downgraded after poor year, oil exposure
Alaska Journal of Commerce, Elwood Brehmer, July 13, 2016
Walker: ‘Devastating’ fallout for Alaska if Legislature denies new money sources
KTUU, July 13, 2016