Guess Where Alaska Stands in the Oil Race
Ed King, King Economics Group, July 8, 2019
Back in the 1980’s Alaska was a powerhouse in the oil market. At the time, our young oil fields were the envy of our peers. Texas production was falling, approaching 2 million barrels per day from above as Alaska approached the same mark from below. Briefly, Alaska challenged Texas as the number one oil producing state in the union and was responsible for 25% of all oil production in the nation. Meanwhile, California oil production was dropping below the one million barrel per day mark. No other state was producing more than half that much back in 1988 (Louisiana). That handful of “small” producing states could not compete with the vast opportunity in the Last Frontier. At the time, Alaska had a lot of leverage. Our land was known to have good source rocks and the region was underexplored. Companies were chomping at the bit to get exploration rights as their lower 48 resources were being depleted and they needed to replace those reserves. The state was awash with a previously unfathomable amount of money. So much money that we repealed our individual taxes, socked a quarter of the royalty money away, and started writing checks to our residents.
Those were the days.
Related: Competing ideas of what leads to a stable business climate in Alaska.
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The U.S. Is Overflowing With Natural Gas. Not Everyone Can Get It.
Stephanie Yang and Ryan Dezember, The Wall Street Journal, July 8, 2019
America is awash in natural gas. In parts of the country there’s hardly a drop to burn. Earlier this year, two utilities that service the New York City area stopped accepting new natural-gas customers in two boroughs and several suburbs. Citing jammed supply lines running into the city on the coldest winter days, they said they couldn’t guarantee they’d be able to deliver gas to additional furnaces. Never mind that the country’s most prolific gas field, the Marcellus Shale, is only a three-hour drive away.
Our Take: We need more pipelines!!