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Northern Gas Pipelines is your public service 1-stop-shop for Alaska and Canadian Arctic energy commentary, news, history, projects and people. It is informal and rich with new information, updated daily. Here is the most timely and complete Arctic gas pipeline and northern energy archive available anywhere—used by media, academia, government and industry officials throughout the world. Northern Gas Pipelines may be the oldest Alaska blog; we invite readers to suggest others existing before 2001.  -dh

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4-15-15 It's Tax Day Again!

15 April 2015 10:36am

Comment: Today, millions of Americans struggle to pay taxes and complete complex tax filing requirements.  How many Americans realize that politicians are diverting painful chunks of their tax payments to political allies whose alternative energy projects are uneconomic?  The pain to family pocketbooks is exacerbated when politicians force consumers (i.e. including taxpayers) to pay higher utility bills that further fund these uneconomic, high cost energy projects   Bookmark this unforgivable example of political income redistribution for future reference!  Even worse, note that Alaska legislators are considering expansion of this assault on consumers by forcing the Regulatory Commission of Alaska and utilities to accept and have consumers pay for uneconomic sources of power.  -dh

Today, the House Natural Resources Subcommittee on Federal Lands held an oversight hearing titled, “Federal Land Acquisition and its Impacts on Communities and the Environment.”  Witness testimony focused on the Land and Water Conservation Fund Act (LWCF) of 1965, which expires on September 30, 2015.    

Pedro van Meurs and Dave Harbour, Alaska, oil taxes, Mexico contractOur friend, Pedro van Meurs (File photo with author) provides our readers with the latest Mexico Bid Provisions and Model Shallow Water Contract: 


Please click here for the commentary of Jay Park QC and me on the latest Mexico Bid Provisions and Model Contract for shallow water of March 25, 2015.

Many improvements were made in the package since December 11, 2014.  Nevertheless, there are many remaining issues.

A detailed review of the Mexican terms will be provided in my courses in Rio de Janeiro on May 18 and May 25 this year.

Feel free to contact me with any questions or comments.

Best regards,
Pedro van Meurs
Po Box CR-56766 # 1261
Nassau, Bahamas
Phone: 1 242 324 4438
Fax: 1 242 324 4439

Email: info@vanmeurs.org     


Randy Simmons, professor of political economy at Utah State University, recently co-authored an article with Strata Policy Analyst Megan Hansen that sheds light on the true, hidden cost of wind power. Simmons and Hansen find that the enormous amount of federal subsidies and grants given to wind power every year make it hard for Americans to understand just how much they’re paying for such an inefficient, costly resource. An excerptfrom their findings follows:

The high costs of federal subsidies and state mandates for wind power have not paid off for the American public. According to the Mercatus Center at George Mason University, wind energy receives a higher percentage of federal subsidies than any other type of energy while generating a very small percentage of the nation’s electricity.

In 2010 the wind energy sector received 42 percent of total federal subsidies while producing only 2 percent of the nation’s total electricity. By comparison, coal receives 10 percent of all subsidies and generates 45 percent and nuclear is about even at about 20 percent.

true cost graph

Wind gobbles up the largest share of subsidies yet produces little power.

But policymakers at the federal and state level, unfortunately, have decided that the American people will have renewable energy, no matter how high the costs. As a result, taxpayers will be stuck paying the cost of subsidies to wealthy wind producers.

Meanwhile, electricity consumers will be forced to purchase the more expensive power that results from state-level mandates for renewable energy production. Although such policies may be well intended, the real results will be limited freedom, reduced prosperity and an increasingly unreliable power supply.

You can read the rest of Simmons and Hansen’s piece here.



14 April 2015 2:15am

LEGISLATIVE NEWS RELEASE: New Bills Seek Savings for Electricity Along Railbelt

SB105 and HB187 would create the Railbelt Electric Transmission Authority


Update on the Alaska LNG Project- Anchorage Make it Monday Forum

Posted: 13 Apr 2015 04:16 PM PDT

The companies working on the Alaska LNG project are working hard to keep the project rolling through the next stage. In the summer of 2015, there will be continuing fieldwork as the project prepares for the Environmental Impact Study (EIS). The Federal Energy Regulatory Commission (FERC) will conduct one EIS for the project that will be accessible to all federal agencies. A 550-800 acre land acquisition is in the works to provide space for the liquefaction plant and marine terminal in Nikiski. The US Coast Guard is also working on the Cook Inlet Waterway Suitability Assessment that will be needed for the project to proceed. Community meetings are continuing at all levels of the project. FERC has opened a 9-month scoping period for the public to bring forward their concerns and questions about the project.

The Legislature and the Governor are locked in a battle over Alaska’s future for LNG. Governor Walker wants the Alaska Gasline Development Corporation (AGDC) to move forward on a project with a higher volume pipe, as an alternative to the AK LNG project. He states that it is good to have alternatives to make sure LNG is viable in Alaska. The Legislature wants to pursue only the AK LNG project and feels that splitting focus will create market confusion and instability in the Alaska oil and gas industry. Anchorage Chamber of Commerce Make it Monday Forum Presenter Larry Persily noted that he felt that AGDC was like a child in the middle of a highly contested divorce/custody battle. The internal battle between the Governor and the Legislature continues to cause frustration for many working on LNG in Alaska.

There are reasons that the AK LNG project could fall apart as well as reasons for optimism that it will continue and become a reality. The global demand for LNG could come up short, Alaska’s competitors could beat us on price, Russia could pull Asian markets to their product, and Alaska politics could get in the way of success for the project. However, there are still reasons to be optimistic moving forward. Alaska’s LNG has high BTU content, we have proven reserves with no exploration work needed, we are a proven supplier, and Alaska is the shortest distance to Asia from the other North American markets.

AK LNG will continue to move forward in their work and the Governor and the Legislature will continue their battle through the end of session next week and beyond. There will be many more discussions on this in the coming months and even years.

JUNEAU-Two bills have been introduced this week to help reduce electricity costs for a majority of Alaskans by creating the Railbelt Electrical Transmission Authority (RETA) to manage electrical transmission along the Railbelt.  The Railbelt is Alaska’s largest interconnected electric transmission area and home to the largest population centers: from Fairbanks in the north through the Mat-Su Borough, Anchorage, Seward and Homer in the south.  

The House Special Committee on Energy, co-chaired by Representatives Liz Vazquez, R-Anchorage, and Jim Colver, R-Palmer introduced House Bill 187 on Friday, while Senator Lesil McGuire, R-Anchorage, introduced its companion bill, Senate Bill 105, in the Senate on Saturday.  

“Historically, we have had three generation and transmission (G&T) utilities along the Railbelt which had regional responsibility and voluntary compliance,” said Senator McGuire.  “Now we have five G&T utilities, each with their own regional challenges that cannot be resolved with the current structure.  We need to find a way to establish predictable, reliable and affordable economic dispatch across the Railbelt with open access policies for independent power producers.  There are tremendous savings possible for the consumer with a unified transmission system.” 

“Delivering affordable energy efficiently is absolutely crucial for Alaskan families and for our state’s economic development – and our Railbelt grid needs to be up to the task,” said Representative Liz Vazquez, R-Anchorage.  “As a former utility board member, I’ve seen this problem first-hand, and we’ve been working very hard this session to start developing a long-term solution. These bills are the first step in solving the problem and bringing affordable energy efficiently to the Railbelt.”

The legislation proposes the Railbelt Transmission Authority would be a division of the Regulatory Commission of Alaska (RCA) which is currently the agency that oversees and regulates Alaska’s utilities.  Several similar concepts have been proposed by various utilities in recent years including the Alaska Railbelt Cooperative Transmission and Electric Company (ARCTEC) and Transco (a Railbelt transmission company).  Though ownership structures differ in all three proposals each have similar goals: economic dispatch of electricity across the Railbelt, open and non-discriminatory access, regional planning of future transmission infrastructure and reduced end-user costs. 

“It is important to state that this bill is a starting point,” said Representative Colver. “We are starting a conversation that I hope results in a more efficient use of our power generation and transmission systems on the Railbelt.  Our goal is to lower the costs of energy to consumers.  I look forward to working with the RCA and engaging with all stakeholders.”

The sponsors of the legislation do not plan on advancing the bill during the current legislative session, but plan to hold meetings over the interim to further develop the plan in preparation for next January.

For more information, please contact Josh Walton in Representative Liz Vazquez’s office at 907-465-3892David Scott in Representative Colver’s office at 907-465-4859, or Jesse Logan in Senator McGuire’s office at 907-465-2995.



13 April 2015 2:23am

Juneau Empire/AP by Mark Thiessen.  The federal government began the review process Friday on Royal Dutch Shell’s plans to continue a drilling program it halted in 2012 in Arctic waters off Alaska’s northern shore.

Today's relevant energy links from Consumer Energy Alliance: 

Jack Belcher, OCS, East Coast, Consumer Energy Alliance, Dave Harbour PhotoCarteret County News-TimesHearing focuses on seismic testing (working story) The N.C. Department of Environment and Natural Resources has heard from a variety of people on proposals to conduct seismic surveys off the coast of North Carolina. Seismic surveys are a method of searching for offshore oil and gas deposits. The federal Bureau of Ocean Energy Management has received applications from four companies to conduct surveys off North Carolina.  ...    Jack Belcher (NGP Photo) of the Consumer Energy Alliance also supported the surveys. He said he thinks it only makes sense to know what energy resources are off the coast.  “Sound energy policy needs to be made with good data,” he said, “and to get that we need to survey.” 

Wall Street JournalNew U.S. Offshore Oil and Gas Drilling Rules Seen Imminent
The Obama administration is expected to propose in the coming days an offshore oil and natural gas drilling regulation aimed at preventing the kind of explosion that erupted five years ago on BP’s Deepwater Horizon rig, killing 11 people and causing the biggest offshore oil spill in U.S. history.
The New York TimesNew Sea Drilling Rule Planned, 5 Years after BP Oil Spill
The Obama administration is planning to impose a major new regulation on offshore oil and gas drilling to try to prevent the kind of explosions that caused the catastrophic BP oil spill in the Gulf of Mexico, administration officials said Friday.
The Washington PostGreenpeace group leaves Arctic drill rig after six-day stay
Six Greenpeace activists opposed to offshore drilling in the Arctic have abandoned a Seattle-bound drill rig they boarded in the Pacific Ocean six days ago, the organization said Saturday. Rough seas prompted the decision, Greenpeace said in an email. The protesters rappelled off the rig and got into inflatable boats before returning to a Greenpeace ship stationed nearby.
Associated PressRough seas force Greenpeace activists to abandon Arctic drill rig after 6 days
Six Greenpeace activists opposed to offshore drilling in the Arctic have abandoned a Seattle-bound drill rig they boarded in the Pacific Ocean six days ago, the group saidSaturday. Rough seas prompted the decision, Greenpeace said in an email. The protesters rappelled off the rig and got into inflatable boats before returning to a Greenpeace ship stationed nearby.

FuelFixFeds launch review of Shell’s Arctic drilling plan
The Obama administration on Friday launched a formal, 30-day review of Shell’s broad plan for boring up to six exploratory oil wells in Arctic waters near Alaska, even as the company moves drilling rigs and equipment to the area.

Washington ExaminerObama climate agenda faces first big test
President Obama's legacy climate agenda faces its first major challenge next week as over a dozen states have their day in court. The U.S. Court of Appeals for the District of Columbia Circuit will hear oral arguments April 16 from states and industry contesting the Environmental Protection Agency's emission rules for power plants. The rules are at the center of the president's legacy agenda for battling the threat of global warming.

ForbesStates Ignoring Mitch McConnell, Working On Clean Power Plan: EPA
Last month Senate Majority Leader Mitch McConnell urged states to ignore the Environmental Protection Agency’s Clean Power Plan, but the states are ignoring McConnell and working toward compliance, EPA Admninistrator Gina McCarthy saidFriday at the University of Chicago.

The Arizona RepublicEPA regulations good for economy? Bah!
Will it be good for Arizona's economy if (and/or when) the Environmental Protection Agency takes control of the state's energy production? To some of us, it's silly to even bother asking such a question. The EPA intends to force clean-air regulations on Arizona power plants intended to reduce carbon emissions by 52 percent within 15 years. The regulations would shut down coal-fired plants, which produce by far the highest percentage of Arizona's energy.

The HillAnti-fracking groups send a letter to Clinton
More than 100 environmental groups are pressuring former Secretary of State Hillary Clinton to oppose hydraulic fracturing, days before her expected presidential campaign announcement. The coalition of mostly local anti-fracking groups noted that New York, the likely host to her campaign and the state she represented in the Senate for eight years, banned fracking in December.
NPRIn Pennsylvania, Employment Booms amid Oil and Natural Gas Bust
Lower oil and natural gas prices have the petroleum industry laying off tens of thousands of workers. It looks like a decade-long trend of job growth in the U.S. oil business may end. But there are parts of the country where those job numbers are still rising. Pennsylvania is one of them. Randy Stroup sees evidence of that where he lives in Williamsport, Pa. "You can drive down the road and see the amount of oil and gas trucks with their names on the side," he says.
Public Radio InternationalFracking is about to change, and almost no one is happy about it
The Obama administration recently announced new rules to regulate fracking. But no one, it seems, is entirely happy with them. Fracking, or hydraulic fracturing, is the process of drilling and injecting fluids into the ground at high pressure to break up shale rock formations and release natural gas that's trapped inside. The practice has helped make the United States the world’s top producer of oil and gas, and has spurred an economic boom in places like North Dakota.
Times RecordForestry Association OK with ‘Threatened’ Bat Status
The Arkansas Forestry Association says it can live with a recent U.S. Fish and Wildlife Service decision to list the northern long-eared bat as a threatened species while allowing most forest management practices to continue unabated.
Arkansas Democrat-GazetteTanks full of oil, U.S. refineries to pump out cheap summer gas
The United States has so much excess oil -- a product of booming production from the nation's shale formations -- that it is running out of places to store it. But before storage tanks begin to spill over, relief is on the way as refiners are set to churn out record amounts of gasoline this year, turning the oil surplus into a gasoline glut.
24/7 Wall StreetLow Crude Oil Prices Leave Thousands of US Wells Uncompleted
There are roughly 2,500 to 3,500 drilled but uncompleted oil wells in the United States, according to analysts at IHS Inc. (NYSE: IHS). As many as 1,400 of those wells are located in the Eagle Ford shale play in South Texas.
Fort Worth Star-TelegramCities concerned about state urban-drilling bill
Senior gas well inspector Tom Edwards weaves his van through the tight spaces of the drilling site, keeping a close eye on the tangle of pipes, hoses and valves pushing water, sand and chemicals deep into the ground to break up the tough shale rock below.
San Antonio Express-NewsPipeline bound for pristine Big Bend
In the wide-open Big Bend, where private property rights are sacrosanct and a “no trespassing” sign means just that, unwelcome interlopers, from nosy environmentalists to federal employees, always have been quickly sent packing. Thus, the news that a couple of billionaire businessmen intend to run a large natural gas pipeline through 143 miles of mostly private ranch land to the Mexican border has folks here in shock.
Midland Reporter-TelegramBig Bend pipeline proposal has residents riled up
In the wide-open Big Bend, where private property rights are sacrosanct and a “no trespassing” sign means just that, unwelcome interlopers, from nosy environmentalists to federal employees, always have been quickly sent packing. Thus, the news that a couple of billionaire businessmen intend to run a large natural gas pipeline through 143 miles of mostly private ranch land to the Mexican border has folks here in shock.
The Denver PostColorado's big coal-burning utilities take a turn to renewable energy
Most of the electricity produced in Colorado still comes from burning coal, but even the state's two largest coal burners are adding more renewable energy. The Tri-State Generation and Transmission Association and Platte River Power Authority each recently announced plans for new renewable energy sources.
ColoradoanAnalysis: What's in Larimer County fracking fluid
More than 100 different ingredients have been used at 30 hydraulic fracturing sites in Larimer County since 2012. Missing from 80 percent of those jobs was an oft-cited cause for health and safety concerns: benzene, a known carcinogenic.
Casper Star-TribuneMead: Federal fracking rule is wrong approach
Wyoming has a proud history of leading the nation with responsible natural resource development. We have a state energy strategy that balances energy production and conservation. We support advanced energy research at UW’s School of Energy Resources and conservation projects through the Wildlife and Natural Resource Trust Fund.
The Detroit NewsFracking opponents try again
The wheels begin to turn in earnest next week on efforts to bring a ban on hydraulic fracturing before Michigan voters in 2016. When Michigan's Board of State Canvassers meets Tuesday, the four-member panel will review forms for the collection of signatures to initiate legislation.
Crain’s Detroit BusinessGroup seeks to put fracking ban on November 2016 ballot
A Michigan group is seeking to put a ban on horizontal hydraulic fracturing up for a statewide vote in November 2016. Secretary of State spokesman Fred Woodhams saysFriday that petition language will be discussed Tuesday at a Board of State Canvassers meeting.
Associated PressUtica shale gas to fuel new eastern Ohio power plant
A Swiss company says it's planning to use natural gas from the Utica shale formation to fuel an $899 million power plant that will be built in eastern Ohio's Carroll County.
Baltimore SunLegislature sends fracking ban to Hogan
Maryland lawmakers on Friday voted to send Gov. Larry Hogan a two-year ban on the natural gas extraction process known as fracking. The action marks the first time the legislature voted for a moratorium on hydraulic fracturing and its most decisive statement yet on curbing the controversial practice.
The Patriot-NewsCourt blocks environmental group's plea for radioactivity data on Marcellus Shale drilling
An environmental group can't have access to raw data collected during a state probe into potential exposure to radioactivity from Marcellus Shale gas and oil drilling operations, a Commonwealth Court panel ruled Friday.
Pennsylvania Business Daily: Marcellus Shale Coalition reports record base of natural gas
Marcellus Shale Coalition (MSC) President David Spigelmyer said Wednesday the Potential Gas Committee’s most recent assessment shows the U.S. had access to a recoverable resource base of 2,515 trillion cubic feet of natural gas at the end of 2014.
State JournalMarcellus tops U.S. gas fields reserves list
The Marcellus Shale area in West Virginia and Pennsylvania has been ranked first in the U.S. Energy Information Administration's top 100 U.S. gas fields list for 2013. The EIA called the addition of the Marcellus Shale to the top 100 “notable,” as the last time the data was updated, in 2009, the relatively young Marcellus region wasn't even part of the top 100.
Wheeling IntelligencerMarkWest Growing In Spite Of Market
Even faced with lower oil and natural gas prices, Marcellus and Utica shale processors continue building billions of dollars’ worth of infrastructure throughout the Upper Ohio Valley.
The Charleston GazetteTest well in Putnam County leads to gas speculation
As gas companies continue to develop the Marcellus Shale in Northern West Virginia, recent gas exploration in Putnam County and Eastern Kentucky have people speculating about the possibility of a future gas boom in the southwest part of the state.
Breaking EnergyDon’t Blame Fracking for California’s Water Woes
It’s inevitable. In comments to nearly every story about California’s drought, someone will rage that if Gov. Jerry Brown really wanted to do something to save water, he’d put an end to fracking in the state.
NewsmaxNY Post: State Killing Job Opportunities by Rejecting Fracking
The Start-Up NY program, created to promote the state and its opportunities, has already spent $28 million, but only attracted 76 new jobs, a New York Post op-ed saysSunday, for a tally of $368,000 per job, but when it comes to the fracking industry, the state's government wants no part.



09 April 2015 9:10am

Reports coming....


08 April 2015 9:54am

Shell, BG Group Merger Signals Huge Changes in Energy

The $70 billion acquisition of BG Group by Royal Dutch Shell will set off some huge, and profitable, changes in energy... Full Story.

FROM ALASKANOMICS: SEATTLE BENEFITTED BY ALASKA.  Earlier this year, the Seattle Metro Chamber released a study that shows continued growth to the Puget Sound region due to Alaska’s economic impact. The report shows that Alaska’s impact can be seen in a number of sectors including freight/cargo, seafood, passenger transportation and tourism, maritime support, refining, health care, and education. In 2013, Alaska accounted for 113,000 direct, indirect, and induced jobs that generated $6.3 billion in wages for the Puget Sound region.

Last week, Seattle hosted a panel of Alaska experts to discuss the impact of low oil prices and how it relates to business throughout the Northwest. The Puget Sound is not expected to feel a real impact in 2015 but could start to feel a pinch in 2016. Puget Sound businesses provide $5.3 billion in goods and services to Alaska, which travel through Puget Sound ports. 2015 contracts are already set, so traffic is not expected to change, but could drop in 2016 if Alaska changes its spending plan for the coming year.

As is the case with the Alaska economic environment, 2015 will not be a crisis for the Puget Sound region, but businesses are more cautious moving forward and planning for 2016. Bill Pedlar, Executive Committee Member with the Alaska Travel Industry Association noted that in 2015 the number of people taking Seattle-based cruises into Alaska is expected to rise 5 percent to record levels, but it could change next year. Marketing budgets will be tight, which will make it harder to win passengers. More than 1 million people pass through Seattle-Tacoma International Airport on their way to an Alaska cruise.

The Puget Sound and Alaska will always be strongly linked and the Pacific Northwest is watching the Alaska economy closely as they plan for the future.

For the “Ties that Bind” report, visit http://www.seattlechamber.com/home/business-tools/community-news/detail/2015/02/06/ties-that-bind-puget-sound-to-alaska-stronger-than-ever

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