Tim Bradner

Permanent Fund holds its own despite market turbulence

Alaska’s Permanent Fund has been riding the roller coaster of financial markets and will probably end its fiscal year on June 30 in basically a break-even position, according to the Fund’s executive director Mike Burns.

The monthly performance report prepared for the Fund’s trustees for April 30 showed a 0.76 percent gain in value over the prior 12 months, although the fiscal-year-to-date (July 1 to April 30) was little better, a gain of 2.03 percent.

ExxonMobil set to begin Point Thomson construction

ExxonMobil Corp. is set to begin construction this winter on its multi-billion-dollar gas cycling and condensate production project at Point Thomson on Alaska’s North Slope.

That’s if a federal environmental impact statement, or EIS, is finalized by the U.S. Army Corps of Engineers, as is expected, ExxonMobil’s senior project manager Lee Bruce said.

Materials for Point Thomson construction also started arriving at Seward the night of June 12, Bruce said.

ExxonMobil set to begin Point Thomson construction this winter

ExxonMobil Corp. is set to begin construction this winter on its multi-billion-dollar gas cycling and condensate production project at Point Thomson on Alaska’s North Slope.

That’s if a federal environmental impact statement, or EIS, is finalized by the U.S. Army Corps of Engineers, as is expected, ExxonMobil’s senior project manager Lee Bruce said.

Materials for Point Thomson construction also started arriving at Seward the night of June 12, Bruce said.

EPA names review panel for Bristol Bay watershed study

The U.S. Environmental Protection Agency has appointed an independent scientific review panel for a draft watershed assessment of the Bristol Bay region in Southwest Alaska, where a joint-venture of Anglo American and Northern Dynasty Minerals are planning the large copper and gold Pebble mine, a senior EPA official said June 4.

Notice of the panel, with its members identified, was published June 5 in the Federal Register.

State blasts Interior for old, leaking wells

Alaska’s Oil and Gas Conservation Commission, a state agency that regulates well safety, is criticizing the U.S. Department of the Interior for leaving open and leaking exploration wells in the National Petroleum Reserve-Alaska.

The wells were drilled by the federal government between 1944 and 1981. There were 136 drilled, none resulting in a commercial-scale discovery.

Oil falls, but state expects a rebound

State officials are warily watching market prices for North Slope crude oil, which dropped to less than $100 per barrel June 1 as markets reacted to slumping demand and a buildup of supply.

An average price of $104 per barrel is needed to balance the state budget for Fiscal Year 2013, the state financial year that begins July 1, according to state budget director Karen Rehfeld.

Hilcorp has big plans for renewal of aged Inlet fields

Hilcorp Energy Co. plans an aggressive program of well workovers and remediation in aging Cook Inlet oil fields and platforms acquired from Chevron Corp. earlier this year, Hilcorp’s Alaska manager said May 24.

“We see shut-in wells as an opportunity, not a liability,” John Barnes, Hillcorp Alaska’s manager, said. “This company has a long history of purchasing and rejuvenating mature, old producing assets,” he said.

Barnes is an Alaska industry veteran and former Alaska manager for Marathon Oil.

Latest NPR-A plan could impede OCS pipeline

There are new worries that National Petroleum Reserve-Alaska management plans proposed by the U.S. Department of Interior could preclude or impede a pipeline across the NPR-A for oil and gas discovered in the Chukchi Sea.

Shell is exploring in the Chukchi this summer and hopes that any oil and gas discovered would be brought to shore by pipeline and across NPR-A to the Trans Alaska Pipeline System, officials told the U.S. Bureau of Land Management in a hearing May 24.

Fuel regs will raise costs, but by how much?

Correction: This article originally referred to Marvin Buchanan as an employe of Totem Ocean Trailer Express Inc. Buchanan works for Horizon Lines Inc.

New U.S. Environmental Protection Agency rules on fuel standards for ocean cargo carriers go into effect in August and the requirements will add to fuel costs for companies that ship consumer goods to Alaska, sources in the industry say.

There are also more stringent requirements effective in 2015 that are likely to result in additional costs.

9th Circuit gives final approval to Shell exploration plan

A federal appeals court upheld the government’s approval of an exploration plan filed by Shell to explore its outer continental shelf leases in the Arctic in 2012.

The unanimous May 25 decision was by a three-judge panel of the 9th Circuit Court of Appeals.

Greenpeace, the Sierra Club, the Wilderness Society and two Alaskan Inupiat groups had appealed the approval of the Beaufort Sea and Chukchi Sea drilling plans given by the Bureau of Ocean Energy Management last August.

State scolds feds for withholding best areas from NPR-A sale

Alaska officials and industry players expressed disappointment May 17 over acreage proposed for a federal lease sale in the National Petroleum Reserve-Alaska in November.

“It’s unfortunate that a lot of acreage with high potential or where modern seismic work has been done has been excluded. This doesn’t send a good message to the state or industry,” state oil and gas director Bill Barron said.

Pebble study cheers foes, draws fire from state

The U.S. Environmental Protection Agency’s release of a draft watershed assessment of the Bristol Bay region in Southwest Alaska on May 18 has given new ammunition to groups opposing the large copper-gold Pebble mine being studied for development.

Environmental organizations, sports fishing groups and some local communities are opposing the mine because of possible damage to fish-bearing streams caused by chemical releases from the mine, and prompted EPA to undertake the study in early 2011.

DHS slaps Furie with $15M fine for Inlet jack-up rig

The U.S. Department of Homeland Security has slapped a $15 million fine on Furie Operating Alaska LLC for a violation of the U.S. Jones Act over transportation of a jack-up rig to Alaska in late 2011, and has given the company 30 days to pay from May 9, the date of a letter notifying the company of the decision. 

Modest bids in Cook Inlet sale; none for Alaska Peninsula leases

There was only modest bidding May 16 in a Cook Inlet oil and gas areawide lease sale, and an offering of leases on the Alaska Peninsula in southwest Alaska at the same time brought no bids in the sale.

State oil and gas director Bill Barron said the total of apparent high bids was $6.86 million with 44 tracts sold to three independent companies and one individual submitting bids. All 44 tracts offered in the Cook Inlet sale received bids, which covered 200,320 acres.

Winter exploration includes discovery, disappointment for Pioneer

Pioneer Natural Resources Co. has made a modest oil discovery in an exploration well drilled this winter but results of another well are still uncertain and a third well was a disappointment, according to the company.

Pioneer CEO Scott Sheffield announced the drilling results during an analysis of Pioneer’s first quarter results given to investment groups.

Brooks Range moves to develop Mustang discovery on Slope

Alaska-based independent Brooks Range Petroleum Corp. has made a discovery at its “Mustang” oil prospect west of the Kuparuk River field on the North Slope, a company official said April 18.

Meanwhile, Repsol is finishing up its first winter North Slope exploration season. The company was able to drill two of three wells that were planned for the winter. Drilling was cancelled for the season at the third well, where a shallow gas blowout forced the suspension of operations.

Flint Hills to close another crude oil refining unit

Flint Hills Resources announced April 10 it is closing its No. 1 crude oil refining unit at the company’s refinery at North Pole due to challenging economic conditions faced by the refinery, company officials said in a press release.

The company will be required to cut 35 to 40 jobs, officials said.

Legislators rush to resolve key bills

With about a week left in the 2012 state legislative session, bills are piled up in the Finance committees of both the state House and Senate and, typically, the most pressing business is left to the last minute.

As is customary, some bills that are priorities of leaders in the House and Senate are being held “hostage” in the other body to gain negotiating leverage.

For example, the House has Sen. Johnny Ellis’ bill extending the state film tax credit in its Finance Committee, where lengthy hearings are being held in a subcommittee. The bill passed the Senate last year.

Slope producers align on LNG project

Gov. Sean Parnell announced Friday that the long-running Point Thomson litigation has been settled in an agreement featuring ironclad production requirements with North Slope producers, who also told the governor they have reached alignment on pursuing a major liquid natural gas pipeline to facilitate exports from Southcentral Alaska.

Senate works on oil taxes, but clock may run out

The state Senate is continuing its detailed review of state oil and gas taxes, but there are growing worries the clock will run out before any revision of the oil tax can be agreed upon.

Lawmakers must adjourn April 15, although there are procedures where the session can be extended.

The Senate Finance Committee was expected to have its version of the tax change bill, Senate Bill 192, finished the week of March 26. It is possible that the full Senate could vote on the bill and send it to the House in early April.

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