How about a salmon tax?

August 7, 2018 | Posted in : News

Oil rises ahead of US sanctions
Reuters, August 7, 2018

Oil prices rose on Tuesday ahead of the introduction of US sanctions against major crude exporter Iran. Spot Brent crude futures were at $73.88 per barrel at early on Tuesday, up 13 cents, or 0.2%, from their last close. US West Texas Intermediate crude futures were up 1 cent at $69.02 barrel. US sanctions against Iran, which shipped out almost 3 million barrels per day (bpd) of crude in July, are set to begin at 12:01 am US Eastern time on Tuesday.

Letter: How about a salmon tax?
Don Johnson, Anchorage Daily News, August 6, 2018

The Stand For Salmon group has a desire to restore Alaska’s salmon populations, but it wants to do it by only addressing salmon habitat. Alaska’s salmon bust problems are not that simple. Unfortunately, there are many offenders to blame for our current salmon bust problems.

Blaming only habitat issues for salmon bust, while ignoring user groups, is like trying to catch a serial murderer by regulating the park the murders are committed in. You catch a murderer by going after the murderer, not by regulating the environment they are murdering in. User groups are busy slaughtering hordes of salmon while Stand for Salmon is busy trying to regulate only salmon habitat. Our salmon bust problems are local and foreign user groups slaughtering our salmon, period. We can end our salmon bust problems by directly addressing the people who are overharvesting our salmon.

Alaska could address these people by charging a straight salmon tax for each salmon killed by anyone. A solution can be reached by increasing the tax until users either cannot afford to kill salmon or pay enough tax to finance a real salmon solution. A salmon tax would guarantee a salmon solution either way. Minor habitat impacts could then be addressed after reducing major user group impacts.

Our Take: While tongue in cheek, this letter makes some good points. Headlamp would like to add that a salmon tax will also capture wages that are going out-of-state with the fishermen who don’t live in Alaska.

New Coast Guard commandant sees the Arctic as an urgent concern
Melody Schreiber, Arctic Today, August 7, 2018

Less than two months into his new job, Adm. Karl L. Schultz, the new commandant of the U.S. Coast Guard, encountered a surprise. The House of Representatives unexpectedly zeroed out the budget for a long-anticipated heavy icebreaker. Schultz was taken aback, but still has hopes the icebreaker — and five other polar-class vessels like it — will still find funding in Congress, and soon. “We need six icebreakers, three of them need to be heavy icebreakers, and we really need one today,” Adm. Schultz said at a recent event at the Center for Strategic and International Studies in Washington. “I am guardedly optimistic, but things change quick,” he said. “It’s a dynamic environment.”

Our Take: Headlamp shares Admiral Schultz’s concern. The U.S. needs icebreakers, today.

Chinese newspaper mocks Trump’s claim of winning trade war as ‘wishful thinking’
Engen Tham, Reuters, August 6, 2018

Chinese state media kept up their criticism of U.S. President Donald Trump’s trade policies, with a newspaper on Tuesday describing as “wishful thinking” Trump’s belief that a fall in Chinese stocks was a sign of his winning the trade war. As the world’s two biggest economies remained locked in a heated tariff dispute, Beijing and Washington have kept up a blistering rhetoric with threats and counter-threats of more punitive trade measures.

Russia says ‘deeply disappointed’ by US sanctions on Iran
AFP, August 7, 2018

Russia on Tuesday said it was “deeply disappointed” by US President Donald Trump’s decision to re-impose unilateral sanctions on Iran. “We are deeply disappointed by US steps to reimpose its national sanctions against Iran,” the Russian foreign ministry said in a statement. The ministry said it will do “everything necessary” to save the historic 2015 Iran nuclear deal and protect its shared economic interests with Tehran.

Our Take: Russia promising to do “everything necessary” to protect its economic interests while China mocks President Trump about the trade war – lots of rhetoric and threats.

Trafigura plans US deepwater oil export terminal
David Sheppard, Financial Times, August 6, 2018

Swiss commodity trader Trafigura has submitted plans to build the first deepwater US oil export terminal capable of loading some of the world’s largest supertankers, with crude shipments expected to soar in coming years. The plan would see the commodity house build an offshore deepwater port facility in Corpus Christi, Texas, on the Gulf of Mexico, with a view to accommodate very large crude carriers capable of carrying more than 2m barrels of crude.

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Headlamp – “Hey do you mine?” Trump better for mining than Obama.

August 6, 2018 | Posted in : News

The Trump jobs era really is different
Dan Kopf, qz.com, August 2, 2018

In terms of job creation, if nothing else, Donald Trump seems quite similar to his predecessor. When you look closer, a lot has changed for certain industries. Under Trump, the situation for certain mining and manufacturing industries has greatly improved. Work in the category “Support activities for mining”—which includes jobs exploring mining sites—grew by almost 28% under Trump, compared to losses of about 23% in the last 16 months of Obama.

Our Take:   Good for Alaska. Good for America! Headlamp will take 28% job growth over 23% job loss every day. Check out the chart in this article showing the industries gaining jobs under President Trump.

North Korea urges U.S. to drop sanctions as Seoul probes illicit coal shipments
Hyonhee Shin, Reuters, August 5, 2018

North Korean state media on Monday urged the United States to drop sanctions, as South Korea said it was investigating nine cases of coal shipments that potentially violated U.N. resolutions. Pyongyang had demonstrated good faith by ending nuclear weapons testing and returning the remains of U.S. troops killed in the 1950-53 Korean War, and the resolutions had lost a reason to exist, said the Rodong Sinmun, a mouthpiece of the ruling Workers’ Party. The statements came days after a confidential United Nations report concluded that North Korea had not halted nuclear and missile program, in breach of U.N. resolutions, and continued illegal trade in oil, coal and other commodities

Our Take: Drop sanctions? You haven’t stopped your nuclear program and are continuing to illegally trade other commodities. Survey says? No.

Amid tariff jitters, Alaska leaders say China-Alaska LNG relationship is a long-term ‘win-win’
Yereth Rosen, Arctic Today, August 6, 2018

With escalating trade tensions prompting China to threaten tariffs on U.S. liquefied natural gas, Alaska officials on Friday worked to calm fears that such a move would scuttle progress on the long-desired North Slope natural gas pipeline project. “Alaska’s vast reserves of natural gas can satisfy market demand for nearly a century, and short-term trade tensions do not change this long-term value proposition,” Gov. Bill Walker said in a statement. “Alaska LNG would be the largest job-creating infrastructure project in the country and would generate billions of dollars in revenue. My team and I will continue our work with the Trump Administration to ensure that Chinese and U.S. officials strike a fair compromise so that Alaska’s natural gas reaches the Chinese market”

As Alaska’s climate team floats carbon pricing, not everyone jumps on board
Elizabeth Harball, Alaska’s Energy Desk, August 3, 2018

Gov. Bill Walker’s Climate Action Leadership Team met Thursday in Anchorage to discuss its draft climate action plan, which recommends Alaska consider a carbon tax — a fee paid by entities that produce or burn fossil fuels, like oil companies, aimed at reducing carbon emissions. But the plan is not a consensus document, and not every member of the team agrees that pricing carbon is a good idea.

Our Take: Headlamp shouldn’t be surprised that those who want carbon pricing have the least ability to make an impact on carbon emissions. Shout out to Lorali Simon, an ex-officio member of the team, for her comment “I think a carbon tax is a horrible idea”. Simon expressed concern for the potential impact to the economy and jobs.

Threat of cyber-attack prompts change in Alaska primary
Mary Simton, KTVA, August 5, 2018

Early voting for the state’s primary elections starts Monday. However, there is a slight change to the process this year due to the current threat of foreign cyber-attacks. The Alaska Division of Elections (DOE) said it is suspending the return of ballots online until security advancements can be made to the state voting system.

From the Washington Examiner’s Daily on Energy:

SEC ENDS ITS CLIMATE CHANGE PROBE OF EXXON MOBIL: The Securities and Exchange Commission has dropped its investigation of Exxon Mobil over whether the oil and gas giant misled investors by not accounting for the impact that climate change has on its business.

Exxon confirmed on Friday that the SEC told the company it is ending the two-year investigation.

Law says: Under U.S. law, public companies must tell shareholders about risks or uncertainties related to their business. In Exxon’s case, its oil and gas operations lead to greenhouse gas emissions when consumers use their products. The companies have been accused of concealing the fact that warming could significantly disrupt their ocean energy exploration activities in Arctic regions.

Our Take: Cities and states should stop wasting their time and money. The courts have thrown out most of these cases, reasoning that climate change is a political question.

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Accelerate Alaska greatly exaggerates the death of resource development in Alaska. 

August 3, 2018 | Posted in : News

“Oil & mining are the future of our state!”  I couldn’t believe it – another politician was suggesting that our economy’s future was resource extraction.  Don’t get me wrong.  Resource development has been good for Alaskans, but it needs to be viewed as a runway, not a destination.”

Our Take:   AKHEADLAMP was surprised to read this opening paragraph from a group named “Accelerate Alaska”, planning a conference in Anchorage to create a road map for the future of Alaska that doesn’t include resource development.  Even more intriguing?   The list of supporters that includes many organizations who receive funding from resource development companies.  The group promises that “you’ll walk away with a road map and some actions”.   AKHEADLAMP anxiously awaits the plan that takes Alaskans away from prosperity and 6 figure jobs…

Price surge propels Big Oil bounce back
Upstream’s Oil and Gas News Editorial, August 2, 2018

While oilfield services companies seem unable to convince investors they are out of the mire, Wall Street has over-egged some oil majors. Disappointing analysts, as some oil companies did with their second-quarter results, is regrettable but of secondary importance. The underlying financial results from ExxonMobil and other industry heavyweights showed more welcome financial improvement. The industry is far better placed to move ahead, now the damage of the oil price downturn has worked its way through the system.

ExxonMobil’s profits rose 18%, while underlying cost of supply earnings at Shell were up by 30%.  Chevron doubled its earnings while BP, which is coming to the end of financial hits from the 2010 Macondo tragedy, saw underlying profits quadruple. These are the kind of financial performances, propelled by Brent crude prices back at $75 per barrel, which underpin future growth.

Sinopec Is Said to Delay U.S. Oil Purchases Amid Tariff Concerns
Sheela Tobben, Bloomberg, August 2, 2018

China’s largest refiner, Sinopec, will hold off on buying U.S. crude as an escalating trade war between Beijing and Washington threatens to make American imports more expensive, according to a person familiar with the matter. The state-run firm will delay buying any U.S. oil for September shipment until it is clear when China’s 25 percent tariff threat on U.S. crude imports might begin, the person said. The move comes as President Trump has directed U.S. Trade Representative Robert Lighthizer to consider increasing proposed tariffs on $200 billion in Chinese goods to 25 percent from 10 percent.

Our Take:   They aren’t building our LNG pipeline, they aren’t buying our oil, they are threatening tariffs on US LNG and they may be more fragile economically than they appear.  With friends likes this…

From the Washington Examiner Daily on Energy:

CHINA THREATENS TARIFFS ON US LNG TO RETALIATE AGAINST TRUMP: China proposed a list on Friday of $60 billion worth of tariffs on U.S. goods, including liquified natural gas.

The move to tax American LNG would be a major setback for the Trump administration’s ambition to flood the world with cheap natural gas as a key component of its energy dominance agenda.

Right back atcha: China is threatening to impose new tariffs on 5,207 kinds of American imports if the U.S. makes good on its pledge to impose a 25 percent tax on $200 billion worth of imported Chinese goods, up from an initial 10 percent rate.

As part of that, China says it would impose a 25 percent tariff on U.S. LNG.

Major stakes: Experts have warned that Trump’s trade war with China is threatening to discourage the world’s fastest growing LNG market from signing long-term contracts with American developers.

China’s demand for LNG is soaring, and it is relying more on the U.S., becoming the third largest destination for American gas behind Mexico and South Korea. Chinese imports of U.S. LNG increased from zero in 2015 to 17 billion cubic feet in 2016, to 103 billion cubic feet last year

China’s Influence
qz.com opinion, August 3, 2018

As America retreats, China is striving for global leadership on everything from trade to climate change to advanced technology. It has the capital to fund infrastructure spending across the globe, and the economic clout to freeze out trade partners and corporations who offend its sense of national identity. But the country may be more fragile than it looks, with a shifting economic model, changing demographics, lots of risky debt, and an aging population.

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Reindeer games or serious economic option? No Chinese builder for AKLNG

August 2, 2018 | Posted in : News

Sinopec drops interest in managing AK LNG construction
Elwood Brehmmer, Alaska Journal of Commerce, August 1, 2018

A Chinese oil giant is still in line to be a major buyer from, but not builder of, the $43 billion Alaska LNG Project. Alaska Gasline Development Corp. President Keith Meyer said Sinopec Corp. is still interested in 75 percent of the LNG produced from the project but is no longer being considered as a construction manager for Alaska LNG. Gov. Bill Walker and Meyer signed a non-binding joint development agreement, or JDA, with Sinopec, the Bank of China and China Investment Corp. Nov. 8, 2017, in Beijing in front of President Donald Trump and China President Xi Jinping. The framework agreement set the foundation for further negotiations over LNG purchases, project financing and possible construction involvement by the government-owned Chinese companies. Sinopec is generally considered the world’s largest oil and gas company.

Our Take: Alaskans will be much more comfortable with the prospect of Sinopec as a buyer, not a builder. AKHEADLAMP wonders why the delay in sharing this information? When Sinopec officials visited Alaska in March, they made it clear they weren’t interested in being a construction manager. 

LNG projects ramp up in response to growing market
Larry Persily, Petroleum Planet for the Alaska Journal of Commerce, August 1, 2018

Oil and gas companies are responding to the growing market for liquefied natural gas by ending their hiatus from new projects, while more liquefaction capacity is coming online in Russia, Australia and the U.S. Gulf Coast. LNG projects under construction or anticipated to reach a final investment decision within the next 12 months total more than 125 million tonnes of annual output capacity — more than a one-third boost to global capacity as reported by the International Gas Union’s 2018 annual report.

Senate GOP bill would amend key section of the Clean Water Act
Nick Snow, OGJ Washington Editor, August 1, 2018

The US Senate Environment and Public Works Committee Chairman John A. Barrasso (R-Wyo.) and three other Senate Republicans introduced legislation on July 31 to change requirements and establish limits for individual states under Section 401 of the Clean Water Act. “The water quality certification process is being abused by a few states in order to delay important projects,” said Barrasso. “The State of Washington has hijacked this authority and blocked Wyoming coal from being exported overseas. The coal terminal project would create jobs and directly benefit families in Wyoming, Washington, and other Western states. The State of New York has taken similar steps to slow the construction of natural gas pipelines. “This kind of obstruction is about politics, not water quality,” he said. “This legislation returns the process to what it was originally designed for—protecting America’s water.” Sens. Shelly Moore Capito (W.Va.), Steve Daines (Mont.), and James M. Inhofe (Okla.) cosponsored the legislation.

Our Take: Process not politics will protect America’s water and allow important projects to move forward. 

Alaska’s draft climate action plan includes carbon tax on page 43
Elizabeth Jenkins, Alaska’s Energy Desk, August 1, 2018

Governor Bill Walker’s Climate Action Leadership Team has been discussing a robust draft plan to tackle climate change. The draft mentions a number of ways to go about that: from beefing up efforts to monitor ocean acidification to better educating the public on the causes of warming.  But the state is going to need a way to pay for it all, and the plan addresses that, too: Alaska should consider a carbon tax.

Our Take: Spoiler alert – the usual suspects want to tax the oil and gas industry in order to pay for their policies that will have minimal impact at best. A shout out to Division of Oil and Gas director Chantal Walsh for pointing out the need for a global strategy that can really make an impact. 

National Defense Act has heavy Arctic focus
KTVA Web Staff, August 1, 2018

Wednesday, Congress passed a bill that will bring more resources to Alaska’s Arctic, where receding sea ice is opening new areas for shipping and exploration.  It’s attracting the interest of Russia– which has 46 icebreakers, according to the federal government. The U.S. Coast Guard has only two– and one of them is 10 years beyond its intended use.  The bill passed Wednesday authorizes six new icebreakers.

Our Take: $286 million for Alaska military construction sure helps our economy! AKHEADLAMP hopes the calls for an updated Arctic strategy, with specific roles for each branch of the military and the requirement that Alaska’s state and local governments be consulted, happens sooner rather than later. 

Norton Sound Communities Look To Build Commercial Reindeer Economy
Gabe Colombo, KNOM, July 31, 2018

Reindeer herding is becoming an increasingly attractive economic option for communities in the Norton Sound region. As winter sea-ice cover becomes more unreliable, the traditional practice of hunting for marine mammals is more dangerous. Some community leaders hope reindeer herds, originally imported from Scandinavia in the late 19th century, could now fill a growing gap in ensuring economic security.

Our Take: Necessity is the mother of invention: A coalition of reindeer-herding tribes that sell meat with a processing plant and freezer in Nome in response to a changing environment. 

From today’s Washington Examiner’s, Daily on Energy:

SAUDIS AND RUSSIANS BOOST OIL PRODUCTION IN JULY TO LOWER PRICES: Saudi Arabia and Russia are making good on their pledge to boost oil production to help lower rising global oil prices.

OPEC countries increased output in July, led by near-record production from Saudi Arabia, Bloomberg reported Thursday. The Saudis oil production rose by 230,000 barrels a day in July, to 10.65 million barrels per day.

Group think: The group’s 15 members collectively produced 32.6 million barrels per day, offsetting continued losses from Venezuela and Libya, and the expected onset of U.S. sanctions against Iran.

Russia, a non-OPEC member, produced oil at its highest level since it joined the group’s effort last year to cut output to raise prices.

How we got here: In June, the oil cartel and nonmember countries, including Russia, agreed to increase output by 1 million barrels per day

The Trump administration had pressured OPEC to boost production after 18 months of cuts because higher global oil prices have led to rising gasoline prices for U.S. drivers.

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Headlamp – Hump-day hypocrisy with Greenpeace.  The return of the Caspian Sea Monster

August 1, 2018 | Posted in : News

Greenpeace Launches Propane-Fueled Blimp to Protest Fossil Fuels, Steps on Rake
Dave Quast, Energy in Depth, July 31, 2018

Early Monday morning, radical activist group Greenpeace launched an ill-conceived stunt over the Taft-Kern County Airport in Taft, Calif. in the form of a…dirigible. Yes, Taft is a town that literally exists because of oil production. And, yes, the blimp is powered by propane and made of petroleum-based polyester. Yes, the tires, O-rings and controls of the airship are made of petroleum-based rubber and plastic. Greenpeace isn’t much for optics, it seems.

Our Take: The “ irony of using a large, fossil fuel-powered, petroleum-based polyester airship to protest the production of fossil fuels.”, is not lost on AKHEADLAMP😊 

Russia eyes reviving Cold War-era ground-effect vehicles to patrol the Arctic
Thomas Nilsen, The Independent Barents Observer, August 1, 2018

Russian officials are considering bringing back an unusual vehicle from the late Cold War era to extend the nation’s ability to protect infrastructure in the Arctic. A Lun-class ekranoplan, or wing-in-ground-effect vehicle, first flew in 1987. The massive missile-carrying half-boat, half-plane construction, with a wingspan of 38 meters, was nicknamed the “Caspian Sea Monster” and flew for just a few years before being at the end of the cold war. It’s now stored in Kaspiysk in Dagestan.

Our Take:  While Russia pulls out all the stops to strengthen their presences in the Arctic, the U.S. House of Representatives wipes out funding for a new icebreaker for America. 

Using data as a carrot, Alaska hopes to entice interest in oil lease sale
Elizabeth Harball, Alaska’s Energy Desk, July 31, 2018

The state of Alaska is offering oil companies a sneak preview on three North Slope areas it’s putting up for bid at this year’s oil and gas lease sale. Under a tax program enacted in 2003, oil companies agreed to release exploration data to the state in exchange for tax credits. Now, the state is offering some of that data on three North Slope areas to other oil companies for a fee. It also has pulled together a wide range of other public data on the areas, like a historical record of bids from previous oil and gas lease sales and compiled it for companies to peruse on the state’s website.

Protestors at Wheeler’s first hearing call him a ‘Pruitt puppet’
Miranda Green, The Hill, August 1, 2018

A group of protestors attending Andrew Wheeler’s first Senate hearing on Wednesday likened the newly appointed acting Environmental Protection Agency (EPA) administrator to his predecessor, Scott Pruitt. The group of protestors silently held up signs calling Wheeler a “Pruitt puppet.” They were promptly asked to leave without incident.

Coal-fired power plant in Healy accused of violating the Clean Air Act
Jill Burke, KTUU, July 31, 2018

Golden Valley Electric Association and the U.S. Environmental Protection Agency have reached a settlement agreement over accusations a troubled coal-fired power plant owned by the rural utility exceeded lawful mercury emissions while operating in 2015 and 2016. More than $300 million dollars have gone into construction and upgrades of the 50MW plant, a coal-fired boiler which creates steam to drive electricity-producing turbines. Built in the 1990s with money from the Department of Energy and the State of Alaska, it has never operated correctly and remained unused for nearly 16 years until 2015.

Our Take:  Most important information in the story:  Regulators told KTUU while mercury is a serious air pollutant, the violations at Healy Unit 2 — likely did not have a significant public health impact. The complaint makes no mention of known health problems stemming from the problem emissions.”

From the Washington Examiner, Daily on Energy:

EMISSIONS OF POLLUTANTS DRAMATICALLY FALL SINCE 1970, EPA SAYS: Emissions of six key pollutants have declined by more than 70 percent since 1970, the EPA said in a report Tuesday, even as the economy grew and Americans used more energy.

The report shows the air is has become cleaner by several measures.

Measuring stick: Since 1990, pollution in several categories have fallen: Sulfur dioxide has dropped by 88 percent; lead by 80 percent; carbon monoxide is down 77 percent; nitrogen dioxide has fallen 56 percent; and ozone pollution is 22 percent lower.

Alaska House primary has the most candidates in 22 years
 Andrew Kitchenman, KTOO and Alaska Public Media,July 30, 2018

Alaska is headed toward an unusually competitive primary in just over three weeks. And that competition is mostly within the Republican Party.  At the top of the ticket, both of the competitive primaries for governor and lieutenant governor are in the Republican Party. There are seven Republican candidates to be governor and six from the party running to be lieutenant governor. Most of the attention right now is focused on the leading candidates for governor: former Wasilla Sen. Mike Dunleavy and former Lt. Gov. Mead Treadwell of Anchorage. In the House, there are 109 primary candidates running, the most since 1996. Twenty-four of the 29 competitive primaries in the Senate and the House are on the Republican side.

 

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Headlamp – Big news for Hilcorp. Bad news for tariffs.

July 31, 2018 | Posted in : News

Houston’s Hilcorp paying over $1B for San Juan assets from Williams
Chron, Jordan Blum, July 30, 2018

An affiliate of Houston’s Hilcorp Energy will pay more than $1.1 billion to acquire the San Juan Basin gas pipeline and processing facilities in New Mexico and Colorado from Oklahoma-based Williams Partners. Hilcorp’s Harvest Midstream business will buy the system in the nation’s Four Corners region that includes more than 3,700 miles of pipeline, two gas processing plants, and one carbon dioxide treatment facility in an area stretching from New Mexico’s San Juan and Rio Arriba counties to La Plata County in Colorado.

Our Take: Good for Hilcorp! Providing jobs and more affordable energy is something we can all get excited about. “We believe this will be a significant economic benefit for the community. Our focus is on becoming the premier midstream services provider in the San Juan by reliably serving all of our customers,” said Harvest CEO Jason Rebrook.

Governor Walker believes steel tariff issue will get resolved
KTVA, Scott Gross, July 30, 2018

Governor Bill Walker on Monday said he doesn’t feel steel tariffs will have a big effect on Alaska or the oil industry. “All the pipe for the pipeline came from Japan,” Gov. Walker said. “I helped unload it off a ship in Valdez and I saw Nippon steel thousands of times.” Gov. Walker says steel could come from a different country if the tariff issue is not resolved. “I do believe it will be resolved, I really do,” Gov. Walker said. “Both sides want to resolve this issue, so I feel it will get done. In the interim, there are going to be some challenges.”

Our Take: Going into a multi-billion dollar project with a “fingers crossed” approach is an interesting way to handle it. Read story below.

From today’s Washington Examiner, Daily on Energy:

TRUMP’S VISION FOR LNG EXPORT DOMINANCE UNDER THREAT: The Trump administration is facing threats to its ambition to flood the world with cheap natural gas as a key component of its energy dominance agenda. And some of the damage is self-inflicted.

Slow approvals: Most immediately, the U.S. has a shortage of facilities along the coasts to export liquefied natural gas, or LNG — the chilled, liquid form to which gas must be converted for shipment in giant tanker vessels across the sea.

The U.S. has two major LNG export facilities in operation today, with another four set to enter service by the end of 2019. Four others have earned regulatory approval, and their developers are making final investment decisions on whether to build their planned facilities based on whether they can secure contracts for the gas they hope to provide.

But more than a dozen other facilities are awaiting permit approval from the Federal Energy Regulatory Commission (FERC), a backlog that the panel is struggling to meet because of a manpower shortage and other issues. In fact, it’s been three years since FERC approved a new LNG export terminal.

Trade war disruption: In the longer run, President Trump’s trade war with China is threatening to discourage the world’s fastest growing LNG market from signing long-term contracts with American developers, experts say.

ConocoPhillips says steel tariffs increasing drilling, production costs
KTUU, Cameron Mackintosh, July 30, 2018

Energy giant ConocoPhillips says tariffs on steel caused a “fairly significant” rise in drilling and production costs during the firm’s second quarter. “We have been and are going to continue to see some inflation pressure, including the steel tariffs in the U.S., which is turning out to be a fairly significant item for us,” Al Hirshberg, executive vice president of production, drilling and projects, told investors on a conference call last week. Hirshberg said Conoco spends about $300 million a year on pipeline, valves and fittings, all of which are made from steel. The firm expects the price tag to continue rising into next year.

Our Take: The tariffs are having both positive and negative affects throughout the US. Unfortunately, Alaska is seeing mostly negative.

China’s Belt and Road Initiative is falling short
The Financial Times, July 29, 2018

China’s Belt and Road Initiative is commonly seen as a program to fund and build infrastructure in some 78 countries around the globe. It is also Beijing’s bid to reshape the world by offering an alternative developmental vision to the US-led world order. In the Chinese context, it is the linchpin of President Xi Jinping’s grand design to create a “community with a shared future for mankind”. As such, the Belt and Road (BRI) is officially intended to showcase an open, inclusive form of development which benefits all countries that participate. To criticize BRI, therefore, is to censure a rising China’s proposition to the world. Yet there is growing evidence that the infrastructure projects are falling short of Beijing’s ideals and stirring controversy in the countries they were intended to assist.

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Headlamp – Canada and Caribou. Climate Change and Carbon Tax.

July 30, 2018 | Posted in : News

Alaska’s Draft Climate Change Plan
Climate Action Leadership Team, July 27, 2018

Governor Walker’s climate action leadership team released their draft climate change plan last Friday. AK HEADLAMP shouldn’t be surprised by the narrative below – but we are disappointed. At the same time that we are celebrating what the Governor, today, called an “exploration renaissance” on the North Slope – his team is advocating for less reliance on fossil fuels.  

3.1 Support and incentivize energy efficiency, renewable energy, de-carbonization and electrification 40 across all sectors.

In order to move toward a climate resilient economy, characterized by less reliance on fossil fuels for energy, the State must embrace local clean energy that can power value-added economic development. Diversification in this way will strengthen the State’s economy overall and increase opportunities for local residents.

Yukon’s government is launching its own study of drilling impacts in Alaska’s Arctic refuge
Arctic Today, Yereth Rosen, July 30, 2018

While the Trump administration is preparing studies leading up to its planned oil leasing in the Arctic National Wildlife Refuge, the government across the border is launching its own analysis of oil development impacts. The government of Canada’s Yukon Territory — which opposes ANWR oil development — is on the verge of awarding a contract for a study of oil-development impacts on the Porcupine caribou herd.

Our Take: AKHEADLAMP can save Canada time and money – according to the Alaska Department of Fish and Game, the caribou herd which migrates north each summer into the oil fields near Prudhoe Bay has been growing. One explanation for the increasing population – good calf production and survival and high survival of adults. Pregnant cows bear calves on land near operating oil fields. There is no evidence that oil development has harmed the herd.  

Full-scale bailout for industries impacted by tariffs would cost $39 billion, Chamber of Commerce says
CNBC, Jeff Cox, July 30, 2018

  • Bailing out all the industries affected by President Donald Trump’s import tariffs could cost taxpayers $39 billion, according to the U.S. Chamber of Commerce.
  • The president recently approved $12 billion in aid to farmers, even though some of them said they didn’t want it.
  • Prominent congressional Republicans opposed the bailout, which a Chamber official called “a slippery — and costly — slope.”

Our Take: Seems simple enough “The best way to protect American industries from the damaging consequences of a trade war is to avoid entering into a trade war in the first place,” Neil Bradley, the organization’s executive vice president and chief policy officer, said in a statement.

Charles Koch, network send GOP a message: We’re happy to back Democrats who share our policy goals
CNBC, Brian Schwartz, July 29, 2018

Leaders of the political network financed by billionaire industrialist Charles Koch called on their top donors to back them in a new initiative: Supporting Democratic lawmakers on issues the organization believe reflect its priorities. According to the organizations CEO, Emily Seidel “If you are a Republican who sits on the committee that wrote the worst spending bill in our country’s history and you voted for it, you’re darn right we will hold you accountable.” In July, Americans for Prosperity unleashed a digital advertising campaign in support of North Dakota Democratic Senator Heidi Heitkamp, thanking her for co-sponsoring the Economic Growth, Regulatory Relief and Consumer Protect Act, a bill that rolls back Dodd-Frank Act regulations mainly on community banks, or those with less than $100 billion in assets. It recently passed in Congress with bipartisan support.

Why is Saudi halting oil shipments through the Red Sea?
Reuters, Stephen Kalin and Rania El Gamal, July 30, 2018

Saudi Arabia announced last week it was suspending oil shipments through the Red Sea’s Bab al-Mandeb strait after Yemen’s Iran-aligned Houthis attacked two ships in the waterway. To date, no other exporters have followed suit. A full blockage of the strategic waterway would virtually halt shipment to Europe and the United States of about 4.8 million of crude oil and refined petroleum products per day.

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Headlamp – Walker has the most money AND a 54% disapproval rating?

July 26, 2018 | Posted in : News

Oil giant reports 2018 profit, compared to big 2017 loss, and successful Alaska development
KTUU, Leroy Polk, July 26, 2018

An oil giant and major player in the Alaska energy sector reported Thursday that their 2018 second quarter portfolio made over a billion dollars in profit. This serves as a stark contrast to their multi-billion-dollar loss at this same time last year, and Alaska has something to do with it.

Our Take: Great news for ConocoPhillips and great news for Alaska. More jobs for Alaskans, more oil for the pipeline, more revenue for the state.

America’s Most and Least Popular Governors
Morning Consult, Cameron Easley, July 25, 2018

Governor’s Bill Walker (I-Alaska) and Bruce Rauners (R-Illinois) remain the most unpopular governors running for re-election this year. Sixty percent of Illinoisans disapprove of Rauner and 54 percent of Alaskans disapprove of Walker.

Our Take:   This news comes on the heels of fundraising reports that show Governor Walker in the lead. The old adage appears to be true – money can’t buy you love.

Gas line officials stand firm: Mat-Su port ‘not feasible’ for LNG terminal
Anchorage Daily News, Larry Persily, July 26, 2018

Several months of additional review did not change the opinion of the state’s North Slope natural gas project development team that Nikiski is a better site than the Matanuska-Susitna Borough-promoted Port MacKenzie for a multibillion-dollar gas liquefaction plant and marine terminal. The Federal Energy Regulatory Commission had instructed the state team to conduct a more thorough analysis of the borough site on Knik Arm as an alternative to the project’s preferred choice of Nikiski, on the east side of Cook Inlet about 65 air miles southwest of Port MacKenzie.

Our Take: A suggestion for the Mat-Su Borough: “Never gonna give you up” isn’t really your song – but “Let it go” should be.

Funding for a long-awaited US heavy icebreaker is target of House GOP cuts
Arctic Today, Melody Schreiber, July 26, 2018

On Wednesday, the U.S. House of Representatives’ Appropriations committee approved its Homeland Security Appropriations Bill for fiscal year 2019 — and funding for a new heavy polar icebreaker is notably absent from the bill, critics say. Several Democratic representatives outlined their objections to the cut in a letter to the committee leaders earlier this week, arguing that it will “place our nation at a distinct economic, geopolitical, and national security disadvantage for years to come.” A floor vote on the appropriations bill isn’t yet scheduled, with members departing for August recess.

Our Take: A big step backward. AKHEADLAMP agrees with Senator Murkowski’s response: “In our Homeland Security FY19 Appropriations bill here in the Senate, we included funding to fully build our first polar strength icebreaker in almost fifty years. It is exceedingly unfortunate that the House does not recognize the sense of urgency, as we deal with Arctic priorities.”

Kansas GOP Sen. Moran’s message to Trump: Resolve EU and NAFTA trade conflicts to focus on China
CNBC, Jacob Pramuk, July 26, 2018

  • Kansas Republican Sen. Jerry Moran urges President Donald Trump to abandon trade conflicts with key allies such as Canada, Mexico and the European Union and instead focus his efforts on alleged Chinese trade abuses.
  • Moran is among Republican senators from states hit by the president’s trade policy that have criticized Trump’s tariff actions.
  • Moran will lead a hearing Thursday at which U.S. Trade Representative Robert Lighthizer will testify.

From today’s Washington Examiner’s, Daily on Energy:

TRUMP STRIKES DEAL WITH EUROPE TO BUY MORE US ENERGY: Trump hashed out a trade deal on Wednesday that will lead to Europe buying more liquefied natural gas from the U.S. to diversify its energy supplies.

Strengthening: Trump said the new steps taken to reduce trade barriers on both sides of the Atlantic will also be “strengthening” the U.S.-European strategic relationship on energy. “The European Union wants to import more liquefied natural gas, LNG, from the United States and they are going to be a big buyer,” he said after meeting with European Commission President Jean-Claude Juncker. The president added that the U.S. will help ease the process for shipping more LNG to the European Union under the new trade deal, but he did not give any details.

Russia: Trump wants the EU not to become dependent on Russian supplies of natural gas, specifically through the construction of the Nord Stream 2 pipeline through Germany. Trump called Germany a “captive” to Russia last week while in Brussels.

Europe will buy more LNG: Juncker said his intention was to “make a deal today,” and that is what happened. He said the European Union will import more natural gas from the U.S. as the number of LNG export terminals increases. “This is also a message for others,” he said.

Reality check: But experts said that European companies would still be responsive to market forces, since Russian gas supplied by pipeline is the cheapest option.

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Headlamp – “Don’t touch my PFD” may not be the majority view. Alaska population decline.

July 25, 2018 | Posted in : News

Poll: Most Alaskans understand or back reduced PFD
KTVA, Emily Carlson, July 24, 2018

More than half of Alaskans say they believe Alaska’s recent Permanent Fund dividend cuts were necessary, according to a recent poll. The Harstad Strategic Research poll was paid for by the Alaska branch of the AFL-CIO. The local union group supported current Gov. Bill Walker when he defeated Republican incumbent Sean Parnell in 2014. Less than half of the combined 51 percent majority which expressed backing for the dividend cuts said they supported them, according to the poll results

Our Take: Candidates in the 2018 election are being judged on this issue – from both sides – those who want the PFD “fully” restored and those who believe a reduction in the PFD is okay to sustain state government. AKHEADLAMP will remind both sides that the biggest issue the state faces is a spending problem – get that under control first, please.

A Closer Look at Alaska’s Labor Force
King Economics Group, Ed King, July 24, 2018

It is the population of an economy that provides the supply of labor and the demand for goods. If the population is declining, you can make a safe bet that the economy isn’t doing well. Many Alaskan’s have probably heard by now that Alaska’s population declined in 2017. If you haven’t, it’s true. Here are the population numbers going back to World War II. It’s subtle, but it’s there. Alaska’s population fell by about 2,700 people in 2017. It’s not nearly as noticeable as the post-pipeline-construction crash in 1977 or the 1980’s recession, but there is a story here.

Our Take: Are we there yet? AKHEADLAMP is –we are ready to hear about real solutions to the problems we are facing. A hint to incumbents – if you were part of creating the problem – you may have to work extra hard to convince us that you can now be part of the solution.  

From today’s Washington Examiner, Daily on Energy:

ENERGY DEPARTMENT ALLOWS FAST APPROVALS FOR SMALL LNG EXPORTS: The Trump administration is planning to speed the approval process for projects to export small amounts of liquefied natural gas. The Energy Department issued a final regulation Wednesday that will enable the agency to automatically approve gas export applications if they are at or below 51.75 billion cubic feet of exports per year and are small enough to not need an environmental review.

‘Unleash’ energy: “The finalization of this rule will expedite the permitting of certain small-scale exports of natural gas,” Energy Secretary Rick Perry said. “The so-called ‘small-scale rule’ will further unleash American energy by reducing the regulatory burden on American businesses while also providing significant benefits to our trading partners in in the Caribbean, Central America and South America.”

Will hype on Chinese and Indian energy demand prove out?
Chron, James Osborn, July 24, 2018

If you listen to the oil executives much of that industry’s future is riding on rising energy demand in the developing world, where electrification rates are low, and income is rising. Some new analysis by the U.S. Energy Information Administration provides a new view of consumption in countries like India, Africa and China.

ICYMI: U.S. Sen. Lisa Murkowski, R-Alaska, yesterday chaired a hearing focused on the factors affecting global oil prices. During the hearing, Murkowski asked about a seldom-discussed topic that could have significant impacts in the near future: the International Maritime Organization’s (IMO) low-sulfur standard for marine fuels, which is set to take effect on Jan. 1, 2020. Murkowski pressed the experts testifying at the hearing on what the standard – commonly known as IMO 2020 – could mean for the shipping industry, farmers, truckers, railroads, airlines, and rural residents of states like Alaska, who frequently rely on diesel or home heating oil. You can watch the dialogue here.

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Headlamp Extra Edition – A glance at the gubernatorial candidates fundraising reports –

July 24, 2018 | Posted in : News

Mark Begich

  • The people who have been with him, forever.
  • Noticeably absent – union leadership and union PAC’s

Mike Dunleavy

  • A whole bunch of small donations from real people
  • $500 from Mike Robbins, Mead’s campaign manager
  • $500 from Craig Richards, Governor Walkers former AG

Mead Treadwell

  • A whole bunch of out-of-state folks
  • $500 from Mike Robbins, his campaign manager
  • Former state senator Tom Wagoner
  • Former state senator Lesil McGuire
  • Current state senator Gary Stevens (still listed on the primary ballot for lite gov)
  • Former Anchorage Mayor George Wuerch

Governor Bill Walker

  • All the Commissioners, his staff and other state employees who want to keep their jobs
  • $500 from Craig Richards, his former AG
  • $500 from Paul Seaton
  • $100 from Sterling Gallagher, the $1/4 million consultant who listed his employment as of 6/3/18 as “Government relations for the Alaska Natural Gas Co.”
  • Assemblyman John Weddleton
  • Perennial Pebble Protestor and BBNC President Jason Metrokin

In the category of bizarre?

Ross Bieling, running against Jennifer Johnston in the primary – House District 28

  • Total Raised – $9,352.48
    • $5,000 of his own cash
    • $3,752.48 of “in kind” that he donated to himself
    • $100 from Wayne Anthony Ross
    • $500 from Gabrielle LeDoux

Over the next few days we will look at the individual match ups in the legislature. There are several challengers to incumbents in the primary who are knocking it out of the park…

 

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