Bill Includes “Cook Inlet Stampede” Tax Credits to Incentivize Jack-Up Drill Rig Exploration of Cook Inlet

Juneau – Sen. Tom Wagoner, R-Kenai, today said the inclusion in SB 309 of incentives for deep level exploration of the Cook Inlet basin will trigger a stampede to bring a jack-up drill rig into the area. Amendments made in the Senate Finance committee incorporate the incentives from Wagoner’s SB 290. Wagoner worked with Sen. Lesil McGuire, R-Anchorage, to put the language in SB 309, and with House Speaker Mike Chenault, R-Nikiski, who introduced a companion bill in the House of Representatives.

“The only way we are ever going to offset the declining oil and gas production in Cook Inlet is to get down to the Jurassic zone and start producing the hydrocarbons in those reservoirs,” Wagoner said. “Cook Inlet is an underexplored basin, and there has not been a jack-up drill rig operating there since the early 1990s. I believe the way these credits are structured will cause a stampede by independents to the Inlet.”

“At a time when natural gas production and supply in the Cook Inlet is declining and demand continues to grow, this legislation will strongly encourage companies to invest additional capital in exploring for new gas reserves,” said Senator McGuire. “This will be another step that will help provide energy for South Central Alaska.”

The tax credits will apply to the first three unaffiliated explorers to drill down to the pre-Tertiary, or into the Jurassic zone, and are structured as follows:

• First explorer is credited 100 percent of costs, or up to $25 million;
• Second explorer is credited 90 percent, or up to $22.5 million;
• Third explorer is credited 80 percent, or up to $20 million.

If the exploration results in sustained oil and/or gas production from a reservoir discovered by the drilling, then 50 percent of the credits awarded would be repaid to the state.

A jack-up drill rig is a mobile drilling platform that uses extendable legs that reach the ocean floor for support and stability.

SB 309 passed the House of Representatives by a vote of 37-2 and passed the Senate unanimously last week.

Therriault and Wagoner to Attend Legislative Energy Horizon Institute

Juneau – Sen. Gene Therriault, R-North Pole, and Sen. Tom Wagoner, R-Kenai, have been selected among 32 legislators from both the US and Canada to attend a comprehensive series of energy forums, the Legislative Energy Horizon Institute, which will examine the full spectrum of energy generation, infrastructure, regulation and government oversight. The objective of the Institute, which is sponsored in part by the University of Idaho with the support of the US Department of Energy, is to examine the complexity and policy questions surrounding current North American energy generation and distribution issues.

“It is an honor to be selected to attend the Energy Horizon Institute, which has the goal to keep a core group of policy makers up to date on the multitude of energy issues states will be wrestling with over the coming years,” Therriault said. “Energy, whether it is oil and gas, coal, electricity, or biomass, is vital to Alaska’s future, as an exporter of energy as well as for our own consumers. I look forward to putting the knowledge I gain at the Institute to work for Alaskans.”

“Maintaining a continuity of knowledgeable members in a legislative body, who are intimately familiar with the complex details you find with all energy issues, is really crucial to crafting productive, appropriate energy policy,” Wagoner said. “This is important to protecting the interests of Alaskans in these energy debates.”

Attendance at all sessions is mandatory for participants, who will receive a University of Idaho certificate at the conclusion of the program.  The first session of the program will be held in Boise, ID from July 12-16, and will include overviews of electric generation and transmission, natural gas, petroleum and strategic leadership. The program curriculum extends over a period of 18 months and will include seminar training as well as monthly “webinars” and other training materials.

“By accepting the invitation to participate in the Legislative Energy Horizon Institute, I look forward to not only bringing information back to Alaska, but also taking information about Alaska’s role in the global energy markets for members from other jurisdictions to consider” said Therriault.

BASIS Link – Fact Sheet – Sponsor Statement – Sectional Analysis
(Documents are in Adobe Acrobat format)

• SB 5 – Partial-Birth Abortion
  Sponsor Statement
  
• SB 6 – Notice & Consent for Minor’s Abortion
  Fact Sheet – Sponsor Statement
  
• SB 7 – Municipal Land Use Regulation
• SB 9 – State Budget Priorities
  Sponsor Statement
• SB 15 – Info, Anesthesia, Consent for Abortion
  Sponsor Statement
• SB 16 – Definitions: Person/Child/Human/Etc
• SB 17 – Limited Liability Companies
• SB 26 – Power Cost Reduction/Energy Council
• SB 30 – State Government Missions: General & HSS
  Fact Sheet – Sponsor Statement
  
• SB 34 – Compressed Natural Gas for State Vehicles
• SB 36 – Executive Branch Records Security
  Fact Sheet
• SB 39 – Extend Board of Public Accountancy
  Fact Sheet
• SB 40 – Extend Suicide Prevention Council
  Fact Sheet
• SB 45 – Veterans’ Cemeteries/Fund/License Plates
  Sponsor Statement
• SB 48 – Meetings of Road Service Area Boards
  Fact Sheet
• SB 52 – Salvia Divinorum as Controlled Substance
  Sponsor Statement
• SB 53 – Approp: Bridges, Service Roads, Trail
  Sponsor Statement
• SB 71 – Alternative Energy for Public Works
  Sponsor Statement
• SB 78 – Legislative Audit Division Powers
  Sponsor Statement
• SB 98 – Medical Patient Billing Disclosures
  Sponsor Statement
  
• SB 106 – Reject Recommendation of Compensation Commission
  Sponsor Statement
• SB 137 – Relating to Meetings of the Board of Fisheries
  Sponsor Statement
• SB 146 – AK Firearms Exept from Federal Regulation
• SB 158 – Return of Property
  Sponsor Statement
• SB 168 – Certification and Designation of Trauma Centers
  Sponsor Statement
• SB 181 – Ultrasounds Preceding Abortions
  Sponsor Statement
• SB 197 – Emergency Contraceptives
  Sponsor Statement
• SB 198 – Liability for Failure to Report Abuse
• SB 200 – Municipal Land Use Regulation
• SB 204 – State Employee Health Savings Accounts
• SB 240 – Manicurist Licensing Requirements
• SB 264 – Alaska Commercial Fishing and Agriculture Bank
  Sponsor Statement
• SB 274 – William Jack Hernandez Fish Hatchery
  Sponsor Statement
• SB 290 – Tax Credit to Drill Wells in Cook Inlet
• SB 297 – Return of Seized Property
  Sponsor Statement
• SCR 2 – No Wood Bison in Certain Areas
  Sponsor Statement
  
• SCR 3 – Oppose Fed. Control of State Land and Water
  Sponsor Statement
• SCR 13 – Supporting Senior Caregivers
  Sponsor Statement
• SJR 3 – Firearms in National Park
  Sponsor Statement
• SJR 4 – AK Territorial Guard Retirement Benefits
  Fact Sheet
• SJR 6 – Oppose H.R. 45 in Congress
  Sponsor Statement
• SJR 7 – Oppose UN Designation of Arctic Ocean
  Sponsor Statement
• SJR 14 – Exemption for Hydraulic Fracturing
  
• SJR 15 – Oppose Assault Weapons Ban
  Sponsor Statement
• SJR 23 – Const. Am: Suits to Interpret Laws
• SJR 25 – Opposing S. 1535–Limit on Aerial Hunting
  Sponsor Statement
• SJR 26 – Parental Rights Amendment
• SR 6 – Oppose TSA Security Rule
• SR 7 – Vehicles Run By Propane/Compressed Natural Gas
  Sponsor Statement
• SR 10 – Domestic Natural Gas & Alternative Energy

Senate Republican Caucus urges Senate Coalition to Address Energy Needs Now

Juneau – Today the Senate Republican Caucus urged their colleagues in the Senate to address energy relief for Alaskans now.  One possible solution, SB 217, sits in the Senate Finance Committee.  The legislation would provide a direct reduction to citizens’ electric bills by about $750 a year.

SB 217, introduced at the beginning of this session by Sen. Tom Wagoner, R – Kenai, and co-sponsored by Sen. Gene Therriault, R – North Pole, has sat in the Senate Finance Committee since January 16.

“It’s shameful,” Sen. Gary Wilken, R – Fairbanks, said.  “We’ve got $13 billion sitting in a coffee can and we can’t even help people across the state who are hurting.  We have nine days left to do something.  If we don’t do something while we are here, shame on us.

“We have ways to do it and we have the money,” Wilken argued.  “We’ve got the Low Income Home Energy Assistance Program already set up that we could fund to provide additional relief to the needy, or there is Senator Wagoner’s bill.  We have the means, we have the knowledge, and we have programs in place that we could fund to help.  Why wouldn’t we give people a hand?”

During debate on the floor Sen. Wagoner even offered to remove his name from the bill, arguing that if his minority status was causing the bill to be held in committee, he would be happy to let a member of the Senate majority, made up of both Democrats and Republicans, take authorship in order for the bill to move.

“We have energy costs in Alaska all year around,” Wagoner said.  “This bill could provide relief to Alaskans now by lowering electric bills $750 in this coming year.  The way the bill is set up, it could take care of about 90% of all Alaskans.”

Alaskan residents without an electric meter would be able to apply for the same benefit from the Department of Commerce, Community & Economic Development.

“The sad irony,” Wagoner pointed out, “is that the state is getting rich with the high price of oil, but our people are being hit hard by those same prices.  The windfall we have been busy spending and saving is the very windfall that’s creating the burden on Alaskans.

“While we’re here in the capitol building enjoying the problem of what to do with the surplus, people on fixed incomes, people in Bush Alaska, in urban areas, in Southeast, all over the state, have to decide whether to pay for their medications, their food, or their energy bills.”  Wagoner said.

During the floor debate some members of the Senate majority highlighted other bills passed and under consideration that address some long-term energy issues.

“The weatherization bill the Senate recently passed is a good package,” Therriault agreed, “but it doesn’t address the immediate need.  Winterizing homes is good for lowering fuel consumption and will reduce the cost to home owners, but we haven’t done anything to deal with costs suffered by home owners now, this winter, or next year.  It would take a number of years to realize the benefits of winterization.  We’re talking about some kind of relief now.”

The relief afforded under SB 217, also called the Alaska Power Cost Reduction Program, would take affect when oil prices reach the level where the state’s ACES tax progressivity is triggered, about $60 per barrel, and stays at that level for at least 12 consecutive months.

SB 217 also sets up a commission that would be tasked with preparing an energy plan to address residential, municipal, and rural community energy delivery and needs in the years to come.

Senator Wagoner’s Bill Gives Alaskans $750 Annual Credit on Home Energy Bill

Juneau – Sen. Tom Wagoner, R-Kenai, announced today that he has a sponsor substitute for Senate Bill 217 that will be introduced in the Senate on Friday. The new language in the bill provides every home owner and renter in Alaska a $750 annual credit on their residential electric bill – or $62.50 a month.

“Energy prices are soaring and Alaskan’s need some relief.” Wagoner said. “In addition to provided that relief, my bill goes a step further and sets up the Alaska Energy Council, which will be tasked with preparing an energy plan to address residential, municipal, and rural community energy delivery and needs in the years to come.”

The relief afforded under the bill, SB 217, also called the Alaska Power Cost Reduction Program, will take affect only when oil and gas prices reach the level where the state’s ACES tax progressivity is triggered, about $60 per barrel, and stays at that level for at least 12 consecutive months.

“The reason we had the $750 energy credit kick in when oil and gas prices are high is because that’s when utility costs start to rise and when the Alaskan people most need a break. That is also when the state can most afford to help out residents because state revenues will get a boost from ACES progressivity tax.”

“Let’s use the tax money we get from high oil and gas prices to reduce the negative affects of those high prices” Wagoner explained.