I continue to watch the efforts of the companies in Cook Inlet and the utilities to solve the coming natural gas shortage. Enstar and Hilcorp are both looking at importing gas until in-state solutions evolve. As Alaskans, we dislike the thought of importing gas when we have our own. The trick is we can’t access it fast enough to prevent brown and black outs, so imports will likely be the stopgap. The question is — can, and will, the small companies drill without royalty relief, without AIDEA assistance to secure a second rig, or some other help from the state?
The other unavoidable and important question we must ask — can we actually stop talking about LNG from the North Slope and make it happen? After a state investment of an amount approaching $700 million over the decades, we’ve been sitting back waiting for the free market to do its thing, but the numbers haven’t penciled out thus far. If there ever was a time when I thought they might, it would have been when the Ukraine Russia conflict broke out and the need for American natural gas intensified. But it still didn’t.
I’ve reached a conclusion as I’ve watched this saga get us nowhere fast. Allow me first to draw a parallel before I tell you what my conclusion is.
When the building of the Parks Highway began in the late 1950’s, continued through the ‘60’s and was completed in 1971, did it pencil out economically? Would there be enough vehicles moving back and forth, commerce spurred, and economic activity taking place to justify the multi-billion-dollar project? No, it did not pencil out on paper, but we built it. We built is because the infrastructure was necessary for life, for people to function, for opportunities, for growth, for movement of people and goods.
The government played its appropriate role: it provided the essential infrastructure when we built the Parks Highway.
That’s my conclusion regarding moving gas from the North Slope: it will require essential infrastructure to allow more affordable energy for Alaskans, export potential, and revenue for our state; in other words, to manage and develop our resources for the maximum benefit of Alaskans as our state constitution requires, we will need to invest in essential infrastructure to make it happen.
With the new pro-resource development, pro-energy independence federal administration, it’s time Alaska step up the effort, partner with the opportunity in front of us, and ‘git ‘er done!
