Emperor’s Rants and Observations

The Federal Energy Regulatory Commission report to Congress said any applicant proposing to build a multibillion-dollar pipeline to carry North Slope gas to market ideally should have firm commitments from producers to ship the gas on the new pipeline.

Many predicted this exact scenario when AGIA was “debated”.

People said there would few if any qualifying offers. We got one

People said that it was going no where without commitments from producers to ship gas through the line.

People said that AGIA would only delay the process further and we would be no closer to the reality of a Gas Pipeline at the end of Palin’s term than we were at the beginning.

People warned that Palin was not going to bully the producers into making a deal that was too risky without a commitment on taxes.

Also, let’s applaud the one man in the legislature, Ralph Samuels, that had the courage of his convictions to vote against AGIA in the wake of the Veco scandal for this exact reason.

Alaskan Best Search - Ralph Samuels

AGIA was a giant step backward. It didn’t produce the competition Palin promised. And yet she steadfastly refuses to consider the proposals of Conoco-Phillips or the Alaska Gasline Port Authority.

The fact is that Palin and her underlings have been wrong every step of the way. Each passing day we are further and further away from making the pipeline a reality.

Alaskan Best Search - Alaska Gasline Port Authority
Alaskan Best Search - ConocoPhillips Gas Pipeline

Palin has committed 500 Million dollars to a company that probably won’t even qualify to get the required permits because they have no gas to ship.

Here is the Murkowski negotiated contract.

You can find all of the supporting documents here.

There is no pipeline if there is no commitment to ship gas. There is no commitment to ship gas without stable long term agreement on costs to the producers. Nobody in their right mind would commit to hundreds of billions of dollars in any project without knowing the the long term costs. Nobody is going to bully the oil companies into making that kind of investment. Even with the bribe of 500 Million dollars the state was only able to get one “qualifying” offer. That alone should be enough to convince anyone how far off Palin is in her thinking.

I can’t fathom why these simple facts are so hard for some people to grasp.

Are we, as a State and people, willing to invest the billions of dollars and take all the risk to develop our vast resources? For instance, are we willing to invest the nearly 40 billion dollars in the Permanent Fund into developing and bringing our resources to market?

There is a good deal of empty rhetoric about how the resources are “ours” and we should dictate and control how and when they are developed. However, whether it is Oil, Gas, Fish, Timber or Minerals it’s private enterprises that take the risk, make the investments and provide the labor and expertise needed. What role should the State take other than landlord, and recipient of taxes, fees and royalties?

Alaskan Best Search - “Natural Resources“

Palin is a self described Conservative Christian Republican. She is an ideologue. The most dangerous type of corrupt politician. She represents an ideology, not constituents. At least honest crooks can be bought off with cash and prizes. She suffers from “Bush II syndrome”. She thinks she is right even when most reasonable and knowledgeable people know she is wrong. She picks the wrong people to put her trust in and sticks with them too long. Loyal to a fault some would say. Sound familiar? It should because those same things are true about our President. There were plenty of warning signs about Bush that people failed to acknowledge. Let’s hope the people of Alaska aren’t so stupid as to repeat the same kind of mistake with Queen Palin. I have hope because we did boot Murkowski to the curb after only one term, but in the same breath we elected a weak sister of his, so the jury is still out. Let’s also not forget that Murkowski started out very popular, he actually received a majority of the vote (56%) unlike the Queen who had more people voting for anyone else than her (48%).

What is most troublesome however is the blind allegiance that her loyal supporters (members of the Queens Court) have for her. It’s as if people just buy into what ever garbage she sets in front of them. Take her Alaska Gasline Inducement Act for instance. First of all, she flat out states that she would veto the bill if it contained any significant changes that would have allowed more flexibility to encourage a wider range of offers and participants. Of course that came at a very opportune timing with the federal indictments being handed down by the FBI for Vic Kohring, Bruce Weyhrauch, Pete Kott and Bill Allen. The gutless wonders (with the exception of Ralph Samuels) wouldn’t dare even appear to be on the side of the Oil Companies so they just basically rubber stamped Her Highness ill-advised bill.

So what is so terrible about the Queens pet bill AGIA? AGIA only works if stockholder and public pressure force the leaseholders, (also known as the producers, the shippers, or basically the Gasline Customers) to agree to commit billions of dollars to long agreements with basically no security. They are counting on the good will of the oil companies essentially. That’s her plan. Her Highness has committed the State to up to 5 years and 500 Million dollars without having any idea (or caring) if the producers will even ship the gas through the pipeline. The state can’t force them to ship the gas, or they wouldn’t even bother with this silly pretense. Yet the members of the Queens court are adamant that this pie in the sky, build it and they will come, scam… uh scheme is the best and surest way to get progress on the Gas line. Murkowski was a signature away from a deal that at least had the pipeline customers talking to us. That would have seemed to be at least a good starting point. However, the Queens advisers thought AGIA was the better way to go, so negotiations with the only entities that have what it takes to get the deal done were dropped. Her loyal supporters cheered, Long Live the Queen. Her cheer leaders like lotsofpipe over on Halcro’s Gasline Hotline are going to be few and far between 4 years from now when we are no closer to a pipeline than we are today, and likely out 500 million to boot.

The Queen is trying to bully the oil companies into something that they don’t think makes financial sense.  There is no way that will or can work, despite what her groupies may think.