The Morning Headlamp, Special Session Day 11: Who can answer questions…a ray of fiscal hope? … and no one ever is TRULY gone…

Who knew transparency could be so opaque and messy? Another day of this special session, and both the Alaska Dispatch News and the Juneau Empire covered recent special session committee hearings in which the Walker administration  via AG Richards and AGDC  attempted to convince  lawmakers to make public more details of contracts for the state’s natural gas pipeline project. In what may be the first time in history that a partner in a project tried to significantly undercut its ability to get the best price for its gas on the open market, the administration wants to take the unprecedented step of making every part of ADGC’s negotiations open to the public.  Headlamp wonders why the administration is only interested in this level of transparency for the AKLNG project and not with any of the other state-owned corporations, including AIDEA and the Permanent Fund Corporation.  Headlamp notes that legislators again expressed frustration with the repeated “I can’t speak for the governor…” statement instead of an answer to their questions.

These unorthodox limitations on confidentiality concerned several Alaskan lawmakers, including Wasilla Rep. Lynn Gattis who said, “If we’re going to be in business and participate with business, why wouldn’t we act like business? Are we going to make money? Are we looking for profits? Or are we going to be this big bureaucracy that stalls and stymies something that we have looked for 40-plus years?

In yesterday’s House Finance committee meeting, industry expert Dave Harbour shed more light on the confidentiality agreement complications. When addressing potential problems with confidentiality regulations, Harbour stressed that if a decision is not reached, lingering regulatory uncertainty could negatively impact AKLNG’s success. In his closing statements, Harbour emphasized the need for implementing a “curtain of separation” between AGDC and elected officials to avoid the temptation to further politicize the project under the guise of “transparency”. Headlamp hopes that the Walker administration will act as a mature business partner in future negotiations

Ray of hope? Rating service Standard and Poor’s released a statement yesterday saying the governor’s budgetary proposal could help stave off a downgrade in the state’s credit rating. This is a positive development given how dire the situation has looked to many outside the state in recent weeks. Take this poignant analysis by TheStreet.com columnist John Burnett who said last month, “the state’s financial situation has become grave enough that Moody’s recently downgraded its creditworthiness and gave the state’s political leadership one year to clean up its fiscal act or face further downgrades. In the process, Wall Street investors who once saw the state as a reliable play have good reason to be concerned.” Headlamp needs more details of the governor’s fiscal plans.

 Just when you think you’re out, you (may someday) get pulled back in. As Headlamp readers recall, Shell cited an “unpredictable regulatory environment” as a leading reason for pulling back from Alaska last month after spending nearly $4 billion exploring resource development activities in the Artic. While the one lease didn’t make sense for the company, there are “other potential prospects” in Alaska that could make sense, according to Shell CEO Ben van Beurden in this Alaska Dispatch News story. Headlamp’s of the mindset that the more companies in Alaska, employing Alaskans in the pursuit of resource development is a good thing for our state.

 

First Reads

Walker’s campaign promise of transparency sets up clash with industry, Legislature on pipeline project

Alaska Dispatch News, Nathaniel Herz, November 2, 2015

Secrecy rules create angry conflict in Legislature

Juneau Empire, James Brooks, November 3, 2015

My Turn: Moving toward a true owner state

Juneau Empire, Win Gruening, November 3, 2015

 

Alaska Legislature News

Proposal to buy out TransCanada clears its first big hurdle

KTUU, Austin Baird, November 2, 2015

Agency says Walker’s fiscal proposal for Alaska may leave top credit rating intact

Alaska Dispatch News, Nathaniel Herz, November 2, 2015

House minority objects to Arctic drilling complaint

Juneau Empire, James Brooks, November 3, 2015

 

Alaska Energy News

Shell leaves door open for future exploration in Alaska’s Arctic

Houston Chronicle, Jennifer A. Dlouhy, November 2, 2015