Comment: for those consumed in metrics, we recall the bad news that Alaska is now the 4th largest oil producing state in the Nation, behind North Dakota, Texas and California–and production continues to decline.
Today, our good friend and natural resource guru Steve Borell (NGP Photo) reminds us of the good news that Alaska — according to some standards — is the Nation's second richest state, according to Mining, behind our Texas cousins.
Borell, along with other readers and I, remain alert to Alaska's massive per capita spending and future trends. We note that an operating budget 90% dependent on oil revenue, combined with declining oil production, produces an unsustainable fiscal outlook. Yet another third party{F}, the Baker Institute, has issued a solid and sobering summary of this situation, entitled, "The Budget Conundrum: When Oil Revenues Finance Your State".
To fully understand the metrics, we not only look at the more temporal, short range fiscal results but also at the long term trends.
We are confident that by viewing all–not just some–of the metrics, our Governor and Legislature will continue to move forward in support of a sustainable fiscal regime that attracts investment (i.e. including a large diameter export gas pipeline/LNG project) and secures the future of Alaskan citizens.
But our confidence is also based on the certain knowledge that elected leaders MUST continue to seek and promote tax, spending and regulatory reform. They MUST also courageously oppose federal government overreach and regulatory hostility, knowing full well that half the state's lands lie under the heavy hand of federal dominion.
-dh
{Footnote} See ISER, RDC, Pedro van Meurs, Tax Reform, COP: Effects of Tax Reform & Repeal of Tax Reform, 2013 Oil and Gas Legislative Symposium.
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