Representatives from several state agencies and natural resources industries met in Kenai for the annual Industry Outlook Forum, sponsored by the Kenai Peninsula Economic Development District and The Alliance. The speakers were all optimistic about the prospects for Cook Inlet energy production in the coming year.
It seems like the question isn’t “will we get more oil and gas out of Cook Inlet” anymore. But rather, how quickly can we get all the oil and gas that’s out there to market. And in the interest of all the local business leaders attending the forum, how many jobs and how much investment does that translate to.
The inlet has shown big promise the past couple years and Cook Inlet Energy CEO David Hall says one of the challenges in seeing that promise kept is leaving taxes alone.
“I think number one, to keep the momentum going, I think the Alaska tax credit systems that are in place now, those are critical," says Hall. "Keep those in place.
Those incentives have enticed many small companies to come here, like Cook Inlet Energy. And that tax structure and its apparent success in getting gas fields developed was a model for Governor Sean Parnell’s SB 21 oil tax reform at the state level. He spoke to the forum Friday via Skype.
“Cook Inlet was the template for what we did on the North Slope. You folks there are kind of right in the epicenter of economic opportunity being created for Alaskans,” Parnell said.
Production of natural gas here was a big topic, but so was processing natural gas from the North Slope. Everyone seemed hopeful that a long-sought after in-state pipeline from the North Slope to Cook Inlet might finally be just around the corner.
Parnell says getting that gas line to Nikiski is a top priority for him this legislative session.
“I’ve asked the Legislature to pass enabling legislation that gives us that start on pre-front end engineering and design. Really what I’m asking them to do, once they’ve fully vetted the gas line, is let Alaska control our destiny by owning or participating in the Alaska LNG Project.”
He says the project needs to happen in stages, with the state ponying up somewhere in the neighborhood of 70 to 90 million dollars for preliminary work.
“In years past, we’ve been kind of stuck in this story or narrative that the state has to put everything on the table at once and move forward with a gas line and kind of wait for it to happen. That’s not the way companies make decisions. And we’re going to participate in this Alaska LNG Project like a traditional, commercial party would.”
Time will tell if the Legislature agrees with that philosophy, and if those investment dollars will find their way to the Kenai Peninsula, but to the glass-is-half-full crowd, the whole project could be done within a decade.