Michael J. Dunleavy in Special Dialogue…
…with Dr. Daniel Yergin, Vice Chairman IHS Markit 24:19. (Note: Your publisher first met Dr. Yergin in the 1970s when the latter was a rising star in the energy/environmental consulting field.)
Report: On Friday, March 22, 2019, Alaska Governor Michael J. Dunleavy addressed a crowded room at the international energy conference known as CERAWeek, an annual gathering in Houston, TX attended by more than 4,500 individuals from over 70 countries and regions.
Governor Dunleavy, an invited guest and featured speaker, attended alongside a team of oil and gas advisors on a mission to market Alaska to the world. The group took numerous meetings and held a variety of discussions with financers, producers, developers and oil and gas executives. The result – optimism at every turn; from those already doing business in Alaska and others looking to join in on the action. One such company, Repsol, is calling their work in Alaska a “game-changing opportunity.”
“Alaska is a key growth area for our global upstream business in Repsol, and we believe we have a game-changing opportunity here,” said Repsol’s Upstream Executive Managing Director Tomás García Blanco. “Our activity is focused on the North Slope, where we have made several significant discoveries in the Nanushuk formation with our partners. A conducive economic and regulatory environment is a key element of support for the multi-billion dollar investments that development of these assets require. We are absolutely confident these discoveries can be developed safely and responsibly, contributing to the economic security of Alaska, and the energy security of the United States.”
Before a packed house on Friday, Governor Dunleavy and Daniel Yergin, IHS Market Vice Chairman and CERAWeek Chairman, took part in a 25-minute “special dialogue session” to discuss a variety of topics relating to Alaska’s energy renaissance. Governor Dunleavy, who described the conference as “cutting edge” and the best he ever attended, made his pitch as to why Alaska remains one of the strongest energy plays in the world.
Click here to watch Governor Dunleavy’s Special Dialogue with CERAWeek2019 Chairman Daniel Yergin.
“We’ve had some exciting discoveries here in the past several years. As most know, Alaska has a super-giant on the North Slope. There’s a couple new plays, the Nanushuk and the Torok Play, with an estimated 5 billion barrels of new oil—and that’s just on the Kuparuk and Prudhoe side,” said Governor Dunleavy.
Dunleavy and Yergin further outlined the numerous opportunities on Alaska’s horizon, including new activity in the National Petroleum Reserve-Alaska (NPR-A), the historic opening of ANWR’s 1002, and new developments and discoveries on the Alaska North Slope. Speaking on Alaska’s energy renaissance, Governor Dunleavy said:
“It started several years ago. We were fortunate to have several corporations up in Alaska like ExxonMobil, BP, Eni and ConocoPhillips,” said Governor Dunleavy. “We also have had some smaller operators, like Bill Armstrong, who has had some vision in exploration. So, there is a renaissance up there, and there’s still millions of barrels of oil still yet to be produced.
Yergin, a pivotal player in oil and gas policy for decades, closed by discussing Governor Dunleavy’s focus on putting Alaska back on the map and the strategic role the state will play in future oil production:
“Governor, we’re really pleased that you found it valuable to be here for a week and your deep engagement in this conference is a very large statement in where you’re going to lead the state, and I think you were very clear – Alaska’s back – and it’s going to be a rising state in terms of oil production and its contribution to energy supplies,” said Daniel Yergin,” IHS Market Vice Chairman.
Early on in CERAWeek, Governor Dunleavy participated in a conversation with IHS Markit Senior Vice President Atul Arya (click image or here to watch).
For additional information on CERAWeek2019, including a press conference Governor Dunleavy held before his trip, click here.
Creating A Sustainable Fiscal Regime For Alaska: “Mission Impossible”, or “Doable Challenge”? Depends on the will, commitment, integrity, and intelligence of its leaders, right?
Commentary: Alaska’s budget process and economy are unsustainable based on current fiscal policy, or, the lack thereof. The new Governor, Michael Dunleavy, has proposed spending reductions (and elimination of unnecessary or duplicative regulatory investment barriers) in the near term coupled with constitutional amendments to improve the long-term investment climate via spending and taxation restrictions. Needless to say, this Governor’s “honeymoon” period is, not unexpectedly, short as he strives to produce a responsible and sustainable fiscal policy. See Alaska’s Spring Revenue Forecast below. -dh
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Department of Revenue Releases Spring 2019 Revenue Forecast
Juneau – Department of Revenue (DOR) Commissioner Bruce Tangeman released the spring 2019 revenue forecast today. The spring forecast includes the Department’s updated FY19, FY20, and long-term forecasts for oil price, oil production, and state revenue.
Not counting transfers from the Permanent Fund, the Department is forecasting unrestricted revenue of $2.7 billion in FY 2019 and $2.3 billion in FY 2020.
Additionally, the Permanent Fund is expected to transfer $2.7 billion to the general fund in FY 2019 and $2.9 billion to the general fund in FY 2020. These amounts are available both for payment of Permanent Fund Dividends and for general government spending.
Alaska North Slope oil prices are forecast to average $68.90 per barrel for FY 2019 and $66.00 for FY 2020. Based on a review of oil market fundamentals, the Department chose not to revise its view on long term oil price since the fall forecast. Long term, the Department continues to expect oil prices to stabilize in the low 60’s in real (inflation-adjusted) dollars.
The revenue forecast is also based on projected North Slope oil production averaging 511,500 barrels per day in FY 2019 and 529,500 barrels per day in FY 2020. The production forecast is prepared in collaboration with the Department of Natural Resources and reflects an updated assessment of future production that slightly adjusted production expectations for the next several years. Production is still expected to remain around 500,000 barrels per day over the next decade as new developments offset production declines from existing fields.
The spring revenue forecast will be made available March 15, 2019 at 3:00pm on the Department’s website, atwww.tax.alaska.gov.