I thought my campaign ad with the cardboard sign was a bit "Hokey" but the Governor's budget in part makes me want to say what "flippin world" does he live in and then Representative Croft's remark to the speech by the Governor being "flippin long" makes me want to say, what "flippin part of the world" does he live in. Russia of old?
First to the Governor's budget. Could we not spend so much? What happened to the wise words of "save it for a ("flippin") rainy day." Not all of the budget was bad however.
The money for investing in the gas line is a good thing and the amount in investment, should be raised. Why?
Because the cold war has ended. And this brings me to Representative Croft.
Listening to Representative Croft talk about slapping a tax on the oil companies for setting on leases is just plain foolish. Does he think that will get the oil companies to react?
Neyt.
Times have changed and the days of a few stable countries to explore in, is gone. The competiveness of the world markets has Alaska trailing for expansion in oil and gas exploration.
The reality is that the State of Alaska will have to invest in the pipeline and will have to offer tax credits to be competitive with countries abroad.
Russia is one example. The cost of labor there is "flippin" low.
If the State of Alaska takes what Representative Croft and Representative Crawford have suggested in their bill, then the oil companies will be saying:
Нет, спасибо, хороший пока, пока, до свидания, привет Россия.
No thanks, good bye, bye, see you later, hello Russia.
If Representative Croft wants to be taken seriously, then he should do his homework.
http://www.mees.com/postedarticles/oped/a46n37d01.htm
Russian And Iranian Gas And Future US Energy Security
Russian Gas Exports To The US
The US, faced with declining domestic gas production and rising gas demand for gas-fired power plants, will soon need to accelerate its importation of LNG. The US government, having recognized the need for action to protect and ensure US energy security, has already signaled its interest in possible Russian gas exports to both the US east and west coasts (Gulf of Mexico coast not being feasible for Russian exports). The Russian government, likewise, has begun to recognize the US as a potentially lucrative new export gas market. In 2003, the Russian government decided to enter for the first time the LNG export market, and to refocus its export gas strategy towards the US as a high priority. Moscow now sees the US gas market as highly lucrative as opposed to the European market which is mature and highly competitive, the latter especially true as a result of recent EU gas market liberalization. Nevertheless, Europe will continue to be of great importance for Moscow as proof of Russia maintaining its reputation as a reliable long-term supplier of pipeline gas.
Gazprom, the Russian State gas production and transportation monopoly, anticipates exporting LNG to the US from either its core gas producing region in the Yamal Nenets autonomous okrug in Western Siberia, from the Shtokman field in the Barents Sea, or alternatively from offshore Sakhalin Island in the Russian Far East. All three represent realistic Russian LNG supply sources for the US market.
While gas transportation from Yamal Nenets could be complicated by severe ice conditions in winter, Shtokman LNG could be shipped from a terminal close to the ice-free port of Murmansk for export to the US east coast. Shtokman gas was planned to go to Europe by pipeline via the North European Gas Pipeline (NEGP). Gazprom now realizes that another option is for the gas to reach consumers earlier via LNG to the US, rather than the NEGP to Europe. The US energy firm, ConocoPhillips, may enter the Shtokman project, joining existing partners Gazprom and Rosneft. ConocoPhillips has proposed using about 25% of the estimated total gas output for the production of 12mn t/y of LNG. It estimates that developing Shtokman LNG would cost a total of around $10bn, including construction of an offshore production platform, an LNG plant, and an export terminal near Murmansk.
Russia’s Sakhalin Island gas development projects also represent another strong contender for Russian LNG exports to the US. As Sakhalin Island is only 50km north of Hokkaido, Japan, it is logical that the Asia Pacific region, including China, South Korea and Taiwan will be the primary market for Sakhalin gas. Depending on the level of reserves actually discovered on the Sakhalin shelf, the US west coast is a logical and longer-term secondary market given its rapidly growing demand and geographical proximity. An issue requiring immediate attention will be construction of an LNG import terminal on the Pacific coast. LNG import terminals are presently being considered for Long Beach, California and Baja, Mexico.
It still remains too early to fully appraise the Sakhalin shelf gas reserves. An example is the potentially highly prolific Sakhalin III – Kirin Block project, won in a 1993 tender by Mobil with partner Texaco and now led by ExxonMobil, with partners ChevronTexaco, and the Russian firms, Rosneft and Sakhalinmoreneftegaz, who joined the project in 1998. The Kirinsky contract area is thought by many in both the Russian and international upstream industry to hold the largest potential of all of the Sakhalin shelf projects. It is believed, based on seismic data, to contain reserves of 4.5bn barrels of oil and 870 bcm of gas. Yet, the project’s first exploration well has yet to be drilled. Thus, Sakhalin gas reserves have the potential to go even higher than current estimates.
There are not one but three realistic possible sources for Sakhalin gas exports to the US west coast – the Shell-led Sakhalin II project, the ExxonMobil-led Sakhalin I project, and the same firm’s Sakhalin III – Kirin Block project. The first gas to be exported from Sakhalin Island will be from Sakhalin II’s planned 9.6mn t/y LNG plant at Prigorodnoye on the southern tip of the Island. Construction of that export LNG plant will get underway in 2003. A $2.5bn contract for the construction of the plant and loading jetty has been signed by Sakhalin Energy, the project operator. The plant will have two liquefaction process trains, each with a capacity of 4.8mn t/y. However, given current project development plans, Sakhalin gas might not be available for the US market until 2010.
Sakhalin Energy has already concluded several long-term LNG sales contracts with Japanese utilities with exports to begin in 2007. While the present absence of a LNG import terminal on the west coast is an issue, Mitsubishi, one of the Sakhalin II partners, has been awarded a contract to develop a $400mn LNG terminal at Long Beach, California to handle 5mn tons/year of LNG with most of the gas distributed to densely-populated southern California. Additional LNG exports to the west coast might in future also come via the Sakhalin I and/or III oil and gas development projects.
It seems the Governor and Representative Croft are preping for votes.
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