Sinopec drops interest in managing AK LNG construction

A Chinese oil giant is still in line to be a major buyer from, but not builder of, the $43 billion Alaska LNG Project. Alaska Gasline Development Corp. President Keith Meyer said Sinopec Corp. is still interested in 75 percent of the LNG produced from the project, but is no longer being considered as a construction manager for Alaska LNG. Gov. Bill Walker and Meyer signed a non-binding joint development agreement, or JDA, with Sinopec, the Bank of China and China Investment Corp. Nov. 8, 2017, in Beijing in front of President Donald Trump and China President Xi Jinping. The framework agreement set the foundation for further negotiations over LNG purchases, project financing and possible construction involvement by the government-owned Chinese companies. Sinopec is generally considered the world’s largest oil and gas company. The JDA also set a soft May 31 deadline for setting the parameters of involvement in the project by the Chinese consortium with advanced negotiations leading to a Dec. 31 deadline for final agreements. Meyer said Sinopec officials originally expressed interest in being a major participant in the four-year-plus Alaska LNG construction effort through its engineering and construction subsidiary, but that possibility was mostly nixed after a Chinese delegation spent a week in Alaska reviewing technical documents and examining the 807-mile pipeline route from the North Slope to Nikiski both from ground and the air. Meyer and other AGDC officials met with the Journal and Anchorage Daily News in a July 26 editorial board meeting. “(Sinopec) has never built an LNG plant and they do not have any Arctic pipeline (experience) — they’ve got a pipeline they built that is longer than ours; it’s got a higher altitude than ours, but it’s not this permafrost stuff,” Meyer said. Sinopec officials have since indicated they would be open to a subcontractor role in final design and construction, according to Meyer. “We said that’s fine because quite frankly it probably would have been a little more of a problem to fit them in than to not fit them in,” he added. Numerous legislators have expressed concerns over the prospect of Sinopec being a major player in Alaska LNG construction if the project moves forward, fearing the company could bring its own workforce and displace Alaskans wanting to work on the project. Some legislators have said they would be hesitant to partner with companies backed by a government with a litany of human rights violations but they would be comfortable with simply selling LNG into China — issues also raised by members of the public during recent AGDC board of directors meetings. The Bank of China and China Investment Corp., which manages the country’s sovereign wealth fund, are also potential Alaska LNG debt financiers and equity investors, respectively. From now until the end of the year the focus with will be on hashing out terms for the definitive, bankable LNG sale and purchase agreements. Meyer said though unlikely, he could see a scenario in which Sinopec agrees to buy LNG from the project without China Investment Corp., or CIC, participating, but investment without LNG is very unlikely. “The way it was originally contemplated CIC was really brought in as the equity investor and they’re supposed to be just like the Permanent Fund, completely independent of (Sinopec’s) decision and isn’t tied to the off-take. We were looking at Sinopec as just the off-take. It’s only been recently that Sinopec is sort of saying well, wait a minute, maybe we should be the investor, not CIC,” Meyer said. “We would be indifferent to that. Our focus is more on the total amount they might own or control.” Meyer and other project officials have long stressed AGDC will retain a majority ownership in the project regardless of its equity partners. The Bank of China’s lending to the project has been envisioned as a share of project financing equal to Sinopec’s capacity purchase amount. The Bank of China or other lenders would loan to a project company set up by AGDC under non-recourse project loans. Customers would then pay into the project company’s escrow account, which would pay operations and maintenance costs first and then the senior project lenders. The banks would lend based on the “sanctity of the commercial contracts,” according to Meyer. “If the customer stops paying the bank can step into those contracts, but we’re keeping the bank short of stepping into those underlying assets,” he said. “We want Bank of China to look at their sister company, if you will, they’re both owned by the state, as the credit support.” ^ Elwood Brehmer can be reached at [email protected]

Alaska remains potential source for critical rare earth elements

Rare earth elements really aren’t that rare; they’re just rarely mined. Many in Washington, D.C., particularly those in the Defense Department, see this as a major looming issue. That’s because the Mountain Pass mine just on the California side of the border with Nevada southwest of Las Vegas closed in 2015 when its operator went bankrupt. It was the last producing rare earths mine in the country. The nation’s supply of these 17 often hard-to-pronounce metals now comes from France, Estonia, Japan and China, according to the U.S. Geological Survey. Most troubling for some is the fact that China dominates the world’s rare earth elements supply. Sen. Lisa Murkowski remarked during a Senate Energy and Natural Resources Committee hearing she held July 17 on domestic mineral security that China has leveraged its dominance in rare earth production in the past and could do it again at a time when the country is in a tit-for-tat trade dispute with the U.S. “My concern, among many concerns, is if China ultimately responds to tariffs by restricting our supply of rare earths, or any number of other minerals, the U.S. could be in serious trouble. We’ve heard testimony in the past about the dangers of the concentration of supply from a handful of countries that control the supply chain,” said Murkowski, who chairs the Energy and Natural Resources Committee. “I’m hopeful that we aren’t about to experience those dangers firsthand and will continue to urge action to reduce this significant vulnerability.” In 2010, China placed an embargo on all rare earths the country was exporting to Japan in retaliation for actions against the crew of a Chinese trawler Japanese officials contended was fishing illegally in the country’s waters. China’s dominance in rare earth markets can make pricing and production data hard to obtain, but it is generally believed the country currently produces roughly 90 percent or more of the world’s rare earths. Murkowski also noted her state could go a long way towards alleviating the country’s dependence on imported rare earth elements, and there is still movement toward development in Ketchikan by Nova Scotia-based Ucore. In December President Donald Trump issued an executive order directing federal agencies to prioritize strategies to reduce U.S. dependence on imports of critical minerals. In May the Interior Department responded with a list of 35 minerals deemed “critical” for their economic importance which also have domestic supply vulnerabilities. The entire rare earths group made the list along with other more common metals such as aluminum, tungsten, cobalt and others. Rare earths are essential in the production of cell phones, hard drives, automobile catalytic converters and medical and military technologies. USGS Alaska Research Geologist Doug Kreiner said in an interview that rare earths are so vital to modern-day products because there are no known substitutes. Heavy rare earths — such as europium, terbium, and ytterbium with a greater atomic weight — are used in products that rely on high-temperature magnets. More common lighter rare earths are used in a plethora of applications including LED displays, according to Kreiner. And demand for them will continue to grow as the world moves towards more hybrid and electric vehicles with high-performance lithium-ion batteries that also contain rare earths, he said. Rare earths in Last Frontier As seems to be the case with most mineral commodities, Alaska holds its own rare earth resources. The most notable deposit is the Bokan Mountain prospect that Nova Scotia-based Ucore Rare Metals Inc. explored until 2015. The prospect on southern Prince of Wales Island is approximately 40 percent heavy rare earths, according to Ucore, which are the hardest to come by. Overall, it holds roughly 5 million tons of ore with rare earth concentrations of 0.65 percent, according to the company. Kreiner said rare earths occur across the state but the viability of mining them other places is largely unknown simply because they haven’t been explored. “Bokan Mountain is the only quote-unquote deposit in Alaska. So whether it’s a deposit or an occurrence is really an economic definition. Basically, it becomes a deposit when it’s concentrated to the point that it can be extracted,” he said. Ucore also holds rights to the Ruby rare earths prospect just north of the Yukon River in the Interior region along the Dalton Highway. Kreiner said concentrations of rare earths aren’t often related to deposits of other commonly mined metals, but they can at times be detected in precious metal ores. The Ruby batholith is in the Ray Mountains, which has large sheets of loose sediments up to 325 feet thick that contain rare earths. Heavy minerals are more concentrated in lower terrain between the Ray Mountains and the Fort Hamlin Hills to the east, according to Ucore. There are other potential rare earth belts extending from near Nome on the southern Seward Peninsula north and east to the southern flank of the Brooks Range as well as in the Porcupine River drainage of Northeast Alaska, Kreiner said. Another large rare earth belt runs from the upper Tanana River west and south through the Alaska Range to the Kuskokwim River basin in Western Alaska. “The hot spots that were identified in our analysis, whether or not they’re prospective we really don’t know because there just hasn’t been a lot of work done out there,” he said. “Geologically speaking I think there are a lot of areas that are prospective for rare earths in the U.S. I think it’s a matter of the geology and finding the systems that are economically exploitable.” Kreiner added that he attributes the lack of domestic rare earths production simply to the recent nature of their demand. “Rare earth elements are a relatively new focus given the applications, particularly high-end technologies and medical science, defense mechanisms and the sort,” he said. Focus shifts for Ucore A 2015 collapse in rare earth prices put Bokan Mountain exploration and development on hold, Ucore Vice President Randy MacGillivray said in an interview, but that hasn’t stopped the company’s work in Alaska. Ucore has shifted its focus to developing a rare earths separation plant that the company plans to locate in Ketchikan. “We know there’s a qualified workforce in Ketchikan and we have a lot of Alaskan support, both from the state and federally, so honestly Ketchikan is a great choice for us on multiple levels,” MacGillivray said. Ucore’s plan is to construct the metal refinement plant, estimated at $25 million, over the next couple years and get it up and running sometime in 2020. Ketchikan’s coastal location allows for easy transport of feedstock via shipping containers and further makes sense given its proximity to Bokan Mountain, according to MacGillivray. “(The plant) will be a significant step forward to being able to ultimately build the mine on Prince of Wales Island because a segment of that construction would have already been financed and constructed; so it’s an enhancement to the project for sure,” he said. In 2014 the Legislature authorized the Alaska Industrial Development and Export Authority to finance up to $145 million of the development costs at Bokan, which Ucore has pegged at about $220 million overall. MacGillivray said AIDEA could be involved in financing the plant, which the company is calling its “specialty metals complex.” Ucore also has a pilot rare earths separation facility just outside of Salt Lake City. The company initially plans to start processing 1,000 to 2,000 tons of ore concentrate per year — eventually ramping up to double the processing quantities. MacGillivray said the concentrate would likely be re-leached in Ketchikan before being subjected to molecular recognition separation technology at the facility. “We would then produce individual oxides and we are currently looking at the potential to produce individual rare earth metals at the facility, which would be a value-added product,” he said. The plant is likely to start with about 10 employees and the workforce could grow to about 25 as production grows. Ucore leaders are currently in early-stage discussions with officials at mines that have byproduct ore containing rare earths but are focused on other metals as well as looking at direct sourcing options, he said.

LNG projects ramp up in response to growing market

Oil and gas companies are responding to the growing market for liquefied natural gas by ending their hiatus from new projects, while more liquefaction capacity is coming online in Russia, Australia and the U.S. Gulf Coast. LNG projects under construction or anticipated to reach a final investment decision within the next 12 months total more than 125 million tonnes of annual output capacity — more than a one-third boost to global capacity as reported by the International Gas Union’s 2018 annual report. Not sitting still as the market grows, world leader Qatar plans to expand its LNG capacity by 23 million tonnes by 2023 — jumping to 100 million tonnes per year. Qatar Petroleum has signed a contract for front-end engineering and design of three new liquefaction trains — the world’s largest — and drilling could start next year to develop additional gas reserves, S&P Global Platts reported. Qatar last year lifted its 12-year-long moratorium on new gas production. Nigeria, the world’s fourth-largest LNG exporter, is taking steps to expand its LNG production capacity by a third, Bloomberg reported. Nigeria LNG, a venture of the state-owned oil company and three oil majors, signed engineering and design contracts July 11. A final investment decision could be taken late this year. The plan would boost annual capacity to 30 million tonnes by 2024. Nigeria’s seventh liquefaction train could cost as much as $6.5 billion to build, with an additional $5 billion for the wells and pipelines to supply the expansion. Working to add Mozambique to the list of 20 LNG-exporting nations, ExxonMobil plans to expand its proposed Rovuma project to cut production costs as the company and its partners prepare to formally tap lenders this fall, Bloomberg reported. ExxonMobil looks to build two liquefaction trains — at 7.6 million tonnes each. “The larger train design will lower the unit cost … and ensure a competitive new supply for the global LNG market,” a spokeswoman said. Under plans submitted to the government, Exxon proposes a 2019 final investment decision with a 2024 start-up. Anadarko plans to raise $14 billion to $15 billion from banks and export credit agencies as it lines up long-term sales to guarantee loans for its own LNG project in Mozambique, Reuters reported. The facility would start at 12.88 million tonnes a year. Partners include Mitsui of Japan and ONGC Videsh of India. Anadarko said it has made enough progress with customers, government approvals, financing and preparing for construction to make an investment decision within 12 months. In addition, Italy’s Eni also is investing heavily in Mozambique. It leads a consortium that last year gave the go-ahead for an $8 billion floating LNG project called Coral, with a capacity of 3.4 million tonnes per year and a planned 2022 start-up. ExxonMobil is looking to possibly double output at its four-year-old Papua New Guinea LNG project, adding 8 million tonnes annual capacity, Interfax Global Energy reported. The Australian Financial Review reported the cost of expanding gas production and LNG capacity could reach $12 billion. Much closer to Alaska, Shell and its partners in LNG Canada are expected to decide later this year whether to start construction in Kitimat, B.C. The first phase would provide 13 million tonnes a year of capacity, with a potential expansion to double that, Canada’s Globe and Mail reported. Shell’s partners include Malaysia’s Petronas, PetroChina, Mitsubishi and Korea Gas. Petronas bought into the venture in May after it abandoned its own multibillion-dollar LNG terminal in British Columbia last year. Including a 415-mile gas pipeline from northeastern B.C. and other costs, LNG Canada could total C$40 billion. Also looking at the Asia market, the $27 billion Yamal LNG project in Russia’s Arctic expects to complete construction of its second and third liquefaction trains by early 2019, reaching full production capacity of 16.5 million tonnes. The Yamal leader, Russian gas producer Novatek, already is making plans for a second Arctic project at almost 20 million tonnes, with an investment decision by 2019. China National Petroleum Corp. is a 20 percent partner in Yamal LNG. It also is in talks to take an equity stake in Arctic LNG-2, according to TASS, the Russian news agency. In addition to taking an equity stake in production, China is signing up for new supplies. The Australian Financial Review reported that PetroChina signed a three-year contract with Papua New Guinea LNG for 450,000 tonnes per year, starting in July. The deal turns PetroChina from a regular buyer of spot cargoes from the terminal into a firm customer and could pave the way for a larger, longer-term contract to help underpin the proposed expansion in Papua New Guinea. “This could be the getting-to-know-you deal,” said Tony Regan, a director of LNG consultancy DataFusion Associates in Singapore. Meanwhile, $200 billion of LNG investments in Australia is coming near an end, with the last two projects — Shell’s Prelude and Inpex’s Ichthys — expected to start production late this year or early 2019, with total capacity of 12.5 million tonnes. On the U.S. Gulf Coast, most of the activity has involved adding liquefaction and export to underutilized or unused LNG import terminals. • Cheniere is continuing to expand its Sabine Pass, La., plant, building a fifth train to add another 4.5 million tonnes of capacity, while marketing a proposed sixth unit. • Cameron LNG in Louisiana, led by Sempra Energy, has three trains under construction at almost 13 million tonnes and a fourth with all its permits. Developers need only to secure buyers for the train before taking an investment decision. • Three trains are under construction at Freeport LNG in Texas, totaling 15 million tonnes, while plans for a fourth have been submitted to regulators. • Reuters reported that start-up of the $2 billion, 2.5-million-tonne Elba LNG export terminal in Georgia is delayed to late 2018. • Three more Gulf Coast projects have federal approval but lack investment decisions. Two would be repurposed LNG import terminals – the 16-million-tonne Lake Charles project, led by Shell and a Texas pipeline company, and 15-million-tonne Golden Pass terminal, led by Qatar and ExxonMobil. And though a greenfield project, without an LNG import terminal, Cheniere is developing its Corpus Christi plant in Texas in a similar phased approach to the brownfield projects, with two trains under construction, at 4.5 million tonnes each, while a third reached final investment decision in May after China National Petroleum Corp. signed on as a buyer. Larry Persily is a former Alaska journalist, state and federal official who has long tracked oil and gas markets and projects worldwide.

Permanent Fund Corp. earns $5.1B in 2018 fiscal year

The Permanent Fund continued its rapid growth during the 2018 state fiscal year by gaining $5.1 billion, or 10.7 percent, and nearly reaching $65 billion in value. The state fiscal year ended June 30. Alaska Permanent Fund Corp. CEO Angela Rodell said Alaskans could take pride in the returns the corporation is achieving for the Fund — even if many are at the same time frustrated with how it is being used. This spring the Legislature and Gov. Bill Walker approved Senate Bill 26, which called for the state to make a draw of 5.25 percent of market value, or POMV, on the Fund’s Earnings Reserve Account to drastically pay down the state’s ongoing budget deficits and pay dividends while at least temporarily ending their three-year debate over how to best employ the Fund’s earning power. The 2019 draw approved in SB 26 was calculated to a roughly $2.7 billion deposit from the Earnings Reserve to the General Fund that was split for the dual purposes. About $1 billion will go toward paying dividends of $1,600 per eligible resident with the remainder to the state budget. “As the state begins a program of relying on the Fund in new ways, APFC’s ability to add value and secure compelling investment opportunities while diversifying and controlling risks has never been more important,” Rodell said in a formal statement. The Permanent Fund Board of Trustees had long advocated for instituting a POMV approach to using the Fund’s earnings because it is a proven way for the state to generate revenue for government services while providing key predictability for Fund managers. Strong market returns have bolstered the Fund the past couple years; it gained 12.6 percent in 2017. Its 8.9 percent five-year return is 2.1 percent above the corporation’s passive benchmark return goal of 6.8 percent for the period and about 2.4 percent above the APFC Board of Trustee’s return objective of 6.5 percent. Specifically, the Fund ended the 2018 fiscal year with a total value of $64.9 billion with $46.1 billion in principal — $40.2 billion of constitutionally protected deposits and $5.9 billion in unrealized income — and another $16.4 billion of net income in the Earnings Reserve Account. The ERA also held $2.4 billion in unrealized gains, according to APFC. The Fund’s $7.3 billion private equity portfolio led the strong performance with a 32.7 percent return for the year. Public equities, the largest portion of the Fund’s investments at $26.9 billion, returned 11.7 percent in 2018 and have averaged 9.5 percent returns over the past five years. This story has been corrected to accurately reflect the growth in the Permanent Fund. The original version incorrectly stated the Fund grew by $6.3 billion in fiscal year 2018. Statutory net income, which flows to the Earnings Reserve Account, was $6.3 billion, while the overall value of the Fund grew by $5.1 billion. Elwood Brehmer can be reached at [email protected]

Movers and Shakers for Aug. 5

Calista Corp. added Noelle Kompkoff in the legal department and Russ Slaten in corporate communications. Kompkoff arrives at Calista as associate counsel with more than 10 years of experience in Alaska Native law and corporate law. Prior to joining Calista, Kompkoff worked as in-house counsel for The Tatitlek Corp. She earned her juris doctor from Willamette University College of Law and a bachelor’s degree in journalism from Western Washington University. Slaten joins Calista as the communications coordinator with more than 10 years of communications experience in journalism, marketing and public relations. At Calista, he creates content for web and print, coordinates media coverage, and assists in creating the communications calendar. Slaten was most recently serving as the communications manager at Catholic Social Services. He holds a bachelor’s degree in journalism and public communications from the University of Alaska Anchorage. Ahtna Inc. announced several new hires and promotions within its subsidiaries. Greg Jarrell joins Ahtna Engineering Services Inc. with 21 years of professional business management and project execution experience throughout Alaska. As the new Alaska regional director, Jarrell will manage all Alaska business operations for AES and its subsidiaries, Ahtna Environmental Inc., and Ahtna Global LLC. Jarrell earned his master’s degree in geologic engineering from South Dakota’s School of Mines and Technology and his bachelor’s degree in geology from the University of Montana in Missoula. Lori Kropidlowski, CPSM, CPS/CAP, has been promoted to business development manager at Ahtna Environmental Inc. Kropidlowski has 26 years of experience in business development and marketing and is a certified professional services marketer through the Society of Marketing Professional Services. Ahtna Global LLC added Jeremy Blei, PE, to the role of senior program manager responsible for overseeing the firm’s extensive portfolio of work with the Federal Aviation Administration. Blei’s professional background includes 20 years of professional engineering and consulting experience, primarily in Alaska. He has managed and delivered all phases of environmental remediation projects including initial site design, remedial investigation, treatability and feasibility studies, O&M, and remedial action/construction. Born and raised in Alaska, Blei earned his bachelor’s degree in civil engineering from the University of Alaska Anchorage. In addition, there are two promotions within Ahtna Global LLC. After four years of successfully managing construction programs at Ahtna, Ron DesGranges has been promoted to director of construction. DesGranges has 19 years of project management, construction, and estimating experience for a wide array of both horizontal and vertical construction projects in Alaska. He has supervised a multitude of large and small projects with annual budgets of up to $500 million. Daniel Caldwell has been promoted to construction manager and estimator. Caldwell has 21 years of construction experience where he has managed major mixed-use commercial, civil, environmental, and infrastructure development projects throughout local and remote areas of Alaska, the contiguous United States, and Canada requiring logistics management expertise. Credit Union 1 hired Chad Bostick as its new chief financial officer. Bostick joins Credit Union 1 with 10 years of experience in the credit union industry, specifically within the Alaska Credit Union League. He previously served as the CFO and audit manager at Matanuska Valley Federal Credit Union, and before joining the Alaska credit union movement, Bostick was an audit and assurance professional at Deloitte LLP in Minneapolis. Bostick has earned the credit union industry designations of certified innovation executive from the Credit Union Executive Society, certified enterprise risk management expert from Credit Union National Association, and certified credit union investment professional from CUNA. He is a graduate of the University of South Dakota and holds a bachelor’s of business administration degree with an emphasis in accounting. He is also currently pursuing an MBA from USD. Credit Union 1 promoted Cassie Magwire to Member Services Support manager at its headquarters in Anchorage. Magwire was initially hired in December 2006 as a teller at CU1’s Eagle River Branch. Since then she has also held the positions of senior teller, member service representative, assistant branch manager, branch manager of CU1’s Downtown Branch, Abbott Branch and most recently DeBarr Branch. CU1 promoted Anna Phommalinh to branch manager of its DeBarr Branch in Anchorage. Phommalinh, who was hired by Credit Union 1 in 2011, has previously served as teller, senior teller, member service officer, accountant and member service supervisor. Prior to her promotion, she held the position of assistant branch manager at the credit union’s DeBarr Branch. Brandon Ousley was hired as CEO of Anchorage Fracture &Orthopedic Clinic. He has nearly a decade of experience in healthcare administration and serving patients. Ousley previously headed the administration at a private primary care practice, which saw massive expansion in the services and care provided to patients during his tenure. Before graduating from Alaska Pacific University with an MBA in health services, Ousley began his work in healthcare as a pharmaceutical sales executive. After earning his degree, he worked as a systems analyst at Providence Alaska Medical Center, later moving on to work in executive healthcare management for the next seven years. Ousley joins Anchorage Fracture &Orthopedic Clinic after five years as the CEO of Medical Park Family Care in Anchorage.

OPINION: Trump is playing to win. Are Republicans?

The establishment defenders of the global status quo are doubling down in their battle against President Donald Trump. Citing trade and immigration, the Koch Bros. announced their intention to withhold support for Kevin Cramer against Democrat incumbent Sen. Heidi Heitkamp of North Dakota in a key race the GOP seeks to flip in a state Trump won by 36 points. They might as well save their money. For the one-time elites in the Republican pundit class, think tanks and Super PACs, it must be frustrating to realize their utter impotence to move the needle against Trump with GOP voters who back him by a nearly 9-1 margin. Much like President Bushes 41 and 43 and failed Republican presidential candidates Sen. John McCain and Mitt Romney — who, thanks to their criticism of Trump, have all enjoyed an image rehabilitation from the media and Democrats that once demonized them — the bogeymen Koch Bros. and their agenda of open borders for trade and immigration are aligning with the left. The U.S. Chamber of Commerce is also investing heavily in an anti-tariff campaign, highlighting as an example the dilemma of craft brewers dealing with duties on aluminum imports in a July 26 post. One can only wonder where the chamber was in the last decade as China began dumping below market price aluminum in the U.S. to ease the glut of overcapacity it built up as it went from 11 percent of global production in 2000 to more than half just 15 years later. According to data from the Aluminum Association, “U.S. imports of semi-fabricated aluminum products from China grew 183 percent between 2012 through 2015 before leveling off (in 2016).” The association notes that, “Eight U.S. based aluminum smelters have either closed or curtailed since 2014 meaning only five smelters are operating in the United States today and only two at full capacity. This represents the lowest level of U.S. production since just after World War II.” This is the status quo the U.S. Chamber is trying to preserve and which Trump is trying to upend. Tariffs are a negotiating tool, albeit a blunt one, but Trump was not elected to keep the Koch Bros. or the U.S. Chamber happy. He promised to disrupt the system and negotiate better deals, and unlike most every other Republican politician who spent cycle after cycle pledging to repeal and replace Obamacare or enforce the border and immigration law, he is keeping those promises. Of course there will be short-term pain for some sectors, either from retaliatory tariffs on American exports or higher costs for domestic manufacturers who still need steel and aluminum from foreign sources until the decimation of our industries can be reversed through restarting mills or opening new ones. Another blunt tool wielded by Trump was the $12 billion proposal to aid the the agricultural sector facing those tit-for-tat tariffs as China and Mexico try to hit him in his red state bases. That drew the ire of our own Sen. Lisa Murkowski, who complained that the Alaskan seafood industry wasn’t included despite its heavy reliance on trade with China that is largely comprised of fish being sent there for processing and then reentering the U.S. or other markets. The question not being asked is why is it more economic to send product all the way to China for processing before it is sold in the U.S.? That work could and should be done here in Alaska. Copper River Seafoods operates a year-round processing plant in Anchorage that employs nearly 200 people producing fish for Walmart. Avoiding a trade conflict with China will not answer that question or lead to more value-added processing in Alaska. Nor does it make sense to abide a system in which we continue to pump hundreds of billions per year into a country that is building militarized islands in the South China Sea, waging cyber warfare and intellectual property theft against us and even threatening our airlines that won’t print its approved version of the map of Taiwan. What Trump’s agri-bailout signaled to the world is that the U.S. is willing to take a punch in the course of winning the fight. It was also an action that couldn’t legitimately be criticized by other countries given their own subsidies, bailouts and protectionism for favored industries. As a result, the European Union’s trade representative flew across the pond to Trump’s turf to start negotiating a solution. Trump worked to find new markets in the EU for products like American soybeans hit by Chinese tariffs. The Putin puppet is also trying to replace Russia as the dominant energy supplier to Europe. The American energy sector, now the world’s largest producer of oil and gas, is also feeling the effect of the metal tariffs. The possible impact on the ultimate price of the Alaska LNG Project has been tossed around as well, but at the last board of directors meeting company executives reported they’d identified potential U.S. sources for rolled 42-inch steel pipe. The demand for U.S. energy isn’t going anywhere even if there are intermediate increases in costs. Sanctions are about to be reimposed on Iran with the U.S. set to cut off the despotic mullahs’ crude oil cash stream used to export terrorism and crush its people. Supply is dwindling from the failed socialist state of Venezuela and there are ongoing production disruptions in the failed state of Libya created by former President Barack Obama and his Secretary of State Hillary Clinton. Trump is presiding over a U.S. economy with a booming energy sector, historically low unemployment, rising wages and soaring consumer confidence. He’s negotiating from a position of strength with every intention to win while the Washington Generals that make up the GOP establishment and donor classes are trying to throw the game. At least they’ll have their token Republican talking head slots on MSNBC as a consolation prize. Andrew Jensen can be reached at [email protected]

FISH FACTOR: Women in the seafood work place report discrimination

Alaska appears to be an exception in terms of gender parity at all levels of its seafood industry. Women comprise roughly half of the world’s seafood industry workforce, yet a report released last week revealed that 61 percent of women around the globe feel they face unfair gender biases from slime lines to businesses to company boardrooms. The women’s overall responses cited biases in recruitment and hiring, in working conditions and inflexible scheduling. The findings were based on 700 responses gathered in an online survey from September through December of last year. Thirty percent of the respondents were men; 27 percent of the total responses came from North America. In my view, Alaska doesn’t fit the picture. Based on “empirical evidence” spanning 30 years as a fisheries writer, I always have encountered women at all levels of seafood harvesting and processing, business, management, education and research, as agency heads and commissioners and in top directorships in industry trade groups and organizations. While women may be outnumbered by men in the state’s seafood industry overall, they are highly visible and valued throughout the workforce hierarchy. Maybe Alaska’s small population levels the playing field and smart, talented women are not so easily overlooked. But that’s clearly not the case elsewhere. In the survey, 33 percent of women said they have faced discrimination at work; 49 percent said there are unequal opportunities for men and women; 12 percent of women cited sexual harassment. One striking finding of the gender equality in the seafood industry report was that women and men have very different perceptions of the problem. Fewer than half of the men surveyed said that they believe women face biases throughout the industry. “Less than one men in 10 consider women are facing discrimination. It is important to see that men and women do not share the same diagnosis. If it is not shared, things cannot change,” said Marie Catherine Montfort, report co-author and CEO of the international group Women in the Seafood Industry. Many women said they are not given incentives to join the seafood industry, especially at school levels. An interesting view shared by 80 percent of both genders was that the industry holds little appeal for women. “This is probably the only shared response — that both believe the industry is not attractive to women. I think this question should be asked by seafood companies and all stakeholders in this industry,” Montfort said, adding “that likely explains the 83 percent (71 percent men) who said the seafood industry has a lack of female candidates for jobs.” The WSI survey also revealed that the seafood industry puts more focus on racial diversity than gender equality. Scandinavian countries got the highest marks for perceptions of gender equality at 58 percent; North America totaled 33 percent. Recognizing and raising the awareness of biases against women is the first step towards making positive changes, Montfort said, and the report findings can “open routes to progress.” “It can identify barriers to gender equality and identify good practices,” she said. To help draw attention to the issue, WSI has launched a short video contest to showcase women working in all areas of the seafood industry. The winner will receive 1,000 Euros ($1,165 US) and get wide play at fishery events around the world. Deadline is Aug. 31. Contact [email protected] Prices high/catches low Salmon prices are starting to trickle in as more sales are firmed up by local buyers, and early signs point to good paydays across the board. At Bristol Bay last week, Trident, Ocean Beauty and Togiak Seafoods posted a base price of $1.25 per pound for sockeye, according to KDLG in Dillingham. Trident also was paying a 15-cent bonus for reds that are chilled and bled, and the others may follow suit. Copper River Seafoods raised its sockeye price from $1.30 to $1.70 for fish that is chilled/bled and sorted. That company also reportedly is paying 80 cents per pound for coho salmon and 45 cents per pound for chums and pinks. The average base price last year for Bristol Bay sockeye was $1.02 per pound, 65 cents for cohos, 30 cents for chums and 18 cents for pinks. Kodiak advances were reported at $1.60 for sockeye, 55 cents for chums and 40 cents for pinks. That compares to average prices of $1.38 for sockeyes, 40 cents for chums and 31 cents for Kodiak pinks in 2017. At Prince William Sound a sockeye base price was reported at $1.95 and chums at 95 cents. At Norton Sound the single buyer was advancing 80 cents per pound for chums and $1.40 for cohos, same as last year, and 25 cents for pinks, an increase of 22 cents. Salmon fishermen at Kotzebue were getting 40 cents for chums, down from 48 cents, but that price is expected to increase when a third buyer comes on line. The weekly summary from the Alaska Department of Fish and Game said that Southeast trollers were averaging $8.48 per pound for chinook salmon, an increase of $1.15 over last year. Troll-caught cohos were at $1.64, a 16-cent increase and chums were paying out at 90 cents, up 13 cents from 2017. All prices are likely to change when more sales are made in coming months. Alaska’s total salmon catches are still down by one-third compared with the statewide harvest topping 70 million fish by July 27. Nearly 42 million of the salmon were sockeye from Bristol Bay. Seafood slight As President Donald Trump prepares to offer U.S. farmers $12 billion in aid to help compensate for losses caused by trade scuffles with China, Democrats in Congress have put forth a plan to help fishermen. House Resolution 6528 was introduced July 25 by Massachusetts Rep. Seth Moulton. It aims to add language to the Magnuson Stevens Fisheries Act that disaster relief funds can also be used in the case of “unilateral tariffs imposed by other countries on any United States seafood.” Co-sponsors of the bill include Reps. Chellie Pingree of Maine, Stephen Lynch and William Keating of Massachusetts, Jared Huffman of California and Raul Grijalva of Arizona. Fishermen “don’t deserve to be victims of this self-imposed trade war,” Pingree said at a hearing last week. Republican Sens. Susan Collins of Maine and Lisa Murkowski of Alaska also are being outspoken in their support of fishermen. But the snub to U.S. farmers of the sea isn’t likely to change. When U.S. Trade Representative Robert Lighthizer was asked if Trump is considering providing other sectors assistance similar to the $12 billion taxpayer funded hand out to the agriculture sector, he replied, “Not at this time. No.” There have been two major trade actions with China that affect Alaska seafood. On July 6, China implemented a retaliatory tariff of 25 percent on U.S. seafood sent to the Chinese domestic market. China purchases 54 percent of Alaska’s seafood exports, valued at $1.3 billion in 2017. Then on July 10 Trump escalated his trade war by proposing an additional 10 percent tariff on seafood exported from China to the U.S. It includes $2.7 billion in American-caught seafood, mostly from Alaska, that is reprocessed in China into fillets and breaded portions and sent back to the U.S. for distribution. That tax is scheduled to go into effect in early September. In the short term, the Alaska seafood industry may see greater impact from that tariff, according to Alexa Tonkovich, executive director of the Alaska Seafood Marketing Institute. ASMI plans to comment on the proposed tariff to trade representatives before the Aug. 17 deadline. “We encourage other industry members that will be affected by these tariffs to also comment and voice concern,” Tonkvich said in a statement. Laine Welch lives in Kodiak. Visit www.alaskafishradio.com or contact [email protected] for information.

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