Senate Majority Bipartisan Coalition Website

State Senator District E

Senate Majority Leader

 

Senator Cathy Giessel Newsletter

UPDATES



Issues affecting

your family, community and jobs.

December 12, 2024

Dear friends and neighbors,

 

Royalty Relief Determination for Furie/HEX oil/gas in Cook Inlet:

 

“After detailed consideration where all the materials presented by the applicant were reviewed and incorporated into our analysis, DNR has determined that Furie meets the necessary requirements and that royalty modification for the seven leases…is warranted…”

 

“DNR authorizes a modification mechanism of three percent state royalty until

KLU’s cumulative gross revenues beginning from September 1, 2024, total $712MM, with royalty rates subsequently returning to original values.“

 

Why this matters to consumers living along the Railbelt and especially in Southcentral ENSTAR consumers: Furie has signed a contract with ENSTAR to supply gas beginning in 2026 to help address the shortage of natural gas. The price with royalty relief will be about $12.30/mcf; without the royalty relief the price would be over $13/mcf.

 

To hear discussion of gas supply from John Sims, Alaska ENSTAR director, the recording is here. The PowerPoint slides are here.

The DNR Royalty Relief determination document is here.

 

Alaska Open Primary/Ranked Choice General Election Recount Results:

 

The recount of votes was completed and the repeal referendum FAILED to pass. The vote recount was 160,230 in favor of repeal. 160,973 opposed to repeal. 

 

Items in this Newsletter:

·     Permanent Fund Values, December

·     Trends, December issue

·     BLM Lease Sale of Alaska's Coastal Plain

·     Current Topics, Stuff I Found Interesting, National Security, Fisheries, Economy, Politics, Healthcare

·     Resource Values, Permanent Fund

This issue has drawn a lot of attention because of the negative population trends it identifies.

"We project a long-term decline in the working-age population, ages 20 to 64. The decrease will be steady between now and 2030 as all baby boomers surpass 65, reducing the working-age number from 430,700 to 423,700."

 

The working age population is not just the employees for retail, oil industry, teachers, etc. They are represent the innovators, entrepreneurs, and builders of families, businesses and communities. This is the age group that determines if a location thrives or wastes away.

 

We need to get serious about this data, and importantly, the "why" behind the data.

 

The next Governor, elected in 2026, will determine if we reverse this negative trend, or continue the downward spiral.

 

Opinion: The simple answer to Alaska's outmigration problem. ADN

Congressionally mandated lease sale announced for Alaska’s Coastal Plain

 

Sale includes minimum acres required, creating smallest footprint of potential surface disturbance and limiting seismic exploration

 

ANCHORAGE Today the Bureau of Land Management (BLM) issued a Record of Decision (ROD) for the Coastal Plain Oil and Gas Leasing Program Supplemental Environmental Impact Statement (SEIS), which analyzed the program as well as a lease sale mandated by Congress in the Tax Cuts and Jobs Act of 2017 (Tax Act) for the nearly 1.6-million-acre Coastal Plain of the Arctic National Wildlife Refuge. The BLM is also issuing the Notice of Sale, for the oil and gas lease sale for 400,000 acres—the minimum required by the Tax Act—in the northwest portion of the Coastal Plain on January 9, 2025.

 

The 2017 Tax Act required the BLM to offer two lease sales in the Coastal Plain within seven years of enactment. During the previous Administration, the first lease sale was held and resulted in nine leases being issued. In January 2021, President Biden issued Executive Order 13990, directing the Interior Department to review the Coastal Plain Oil and Gas Leasing Program. As a result of the deficiencies found during that review, in June 2021, Secretary of the Interior Deb Haaland issued Secretary’s Order 3401, which suspended all activities related to implementing the Leasing Program, pending completion of a comprehensive analysis under the National Environmental Policy Act (NEPA). Of the nine leases sold during the previous Administration’s sale, two were canceled and refunded at the request of the lessees and the remaining seven were canceled by the Department due to multiple legal deficiencies in the underlying record.  

 

The BLM will proceed with the preferred alternative from the recently published final SEIS, which best balances the five purposes of the Refuge by presenting a pathway to provide maximum protection for the conservation purposes of the Refuge while meeting the requirement under the Tax Act. The BLM and the U.S. Fish and Wildlife Service worked as joint lead agencies on the SEIS, which was informed by science, public comments and cooperating agency input. The agencies consulted with Alaska Native Tribes and Corporations and engaged with a wide variety of other stakeholders to develop the analysis, using the best available data and science.

 

The area offered for sale will avoid important polar bear denning and Porcupine Caribou Herd calving areas. This also has the smallest footprint of potential surface disturbance due to No Surface Occupancy stipulations, and limits seismic exploration to the areas available for leasing.

 

Leasing is the first step in the process to develop federal oil and gas resources. Any permits or authorizations for specific on-the-ground activities on lands obtained through the lease sale would require additional review through the NEPA process.

 

The SEIS, ROD and associated documents are available for review at the BLM’s National NEPA Register.

Notice of the second lease sale is posted on the BLM’s lease sale webpage for Alaska.

 

-BLM-

Current Topics

Renewed Southeast Alaska wastewater discharge permits require better bacteria controls. Alaska Beacon

The communities – Haines, Skagway, Sitka, Wrangell, Ketchikan and Peterburg – must make improvements to reduce what are deemed to be overly high levels of fecal coliform and enterococcus bacteria that are being discharged into marine waters, under terms of the renewed permits.

 

Kroger and Albertsons grocery megamerger halted by 2 courts. Alaska Public Media

A federal judge in Oregon has blocked temporarily the merger of grocery giants Kroger and Albertsons, ruling Tuesday in favor of federal regulators.

The ruling makes it increasingly unlikely that the deal, worth $24.6 billion, will eventually succeed. Kroger runs many familiar grocery stores, including Ralphs, Harris Teeter, Fred Meyer and King Soopers. Albertsons owns Safeway and Vons.

(My comment: Yay!)

 

Albertsons sues Kroger and ends failed grocery megamerger. Alaska Public Media

Albertsons has sued Kroger, launching a new chapter in the supermarket wars after the two largest U.S. grocery chains failed to convince multiple courts that they should be allowed to merge to take on bigger rivals such as Walmart.

 

 

National Security

Trump targets Canada with tariff threats - and trolling. The Wall Street Journal

The strained personal connection between the two men stands to complicate Canada’s ability to navigate a second Trump term. The incoming president wants to renegotiate a free-trade deal between the two countries, and has said he would levy tariffs of 25% on imports of all goods from Mexico and Canada. Trump has also demanded that Canada invest more in its military and to secure its borders.

(My comment: I am very concerned about this threat to trade with our largest trade partner and ally in the Arctic. I am hoping that there is a rational policy that will prevail, preventing this crazy tariff threat.)

 

The threats posed by the global shadow fleet--and how to stop it. Atlantic Council

The Andromeda Star turned out to belong to Russia’s shadow fleet, a collection of mostly aging ships that transport sanctioned cargo, especially crude oil. They have obscure ownership, are poorly maintained, and obfuscate the details of their identity. Many frequently obfuscate their movements by manipulating their automatic identification systems (AIS), and many also frequently change their flag registrations. 

(My comment: why should Alaska care about this? Because these “shadow ships” are likely navigating through the Bering Straits. Likely cargo: oil. Twenty year old tankers, leaking oil, or worse becoming disabled, spilling even more oil. Alaska and the US need more Navy and Coast Guard presence in the Aleutians and Alaska’s west coast.)

 

Opinion: Anchorage's vital role on the global security stage. ADN

Anchorage is located at the intersection of several critical geostrategic zones. The Arctic’s growing importance is undeniable, as climate change opens new maritime routes, and resource competition intensifies. At the same time, the region has become a focal point for military posturing from both China and Russia,

(My comment: This is one of the important topics that will be discussed through the new Senate Special committee on Arctic Affairs which I will chair.)

 

Local Indigenous communities key to Arctic security, experts say. CBC News

The new policy, announced Friday, highlights the key role of the region's Indigenous communities, and experts in transatlantic defence say that collaboration with Arctic communities is essential as the region sees more marine traffic as sea ice melts, as well as mounting territorial threats from Russia and China.  

 

 

Economy

Biden seeks to end subminimum wages for workers with disabilities. Axios

The median hourly wage for these folks was $3.46 as of May, per the department's analysis. (The federal minimum wage is $7.25 an hour.)The overwhelming majority of employers that are paying below minimum wage are nonprofit community rehabilitation programs that serve people with disabilities, typically in shelters or segregated settings.

Stunning stat: 10% of these workers earned $1 an hour or less in parts of 2023 and 2024, the Labor Department says.

 

Growth of sports betting may be linked to financial woes, new study finds. Alaska Beacon

While states have cheered the new tax revenue from sports gambling, some new studies have linked the burgeoning industry to lower consumer credit scores, higher credit card debt and less household savings.

(My comment: Gambling is a tax on people who can’t do math. Exactly why I oppose the idea of opening up gambling in its multiple forms in Alaska. It’s a tax on people who can’t do math.)

 

Increase in Port of Alaska surcharge could raise price on goods. Alaska Public Media

The cost of shipping goods to Alaska could rise next year in response to increased fees at the Port of Alaska. The Anchorage Assembly voted last month to increase a tariff surcharge for the Port of Alaska Modernization Program, which applies to all items moving through the port. The program was established last year and helps fund the modernization of the aging-port. 

 

More parents say child care problems are keeping them out of work. Axios

Child care issues are increasingly keeping parents out of the workforce, finds new research from the Federal Reserve Bank of Chicago. If parents can't work, that means less income for families and fewer workers for businesses to hire.

 

Southeast Alaska set to lose nearly a fifth of its population by 2050, report says. Alaska Public Media

According to a recent report by the Alaska Department of Labor and Workforce Development, Southeast Alaska’s overall population is projected to drop by about 17% by 2050 — or roughly 12,000 people. That’s about the populations of Sitka and Wrangell combined. Compare that to Alaska’s overall population, which is projected to drop by 2%.

 

 

Politics

'Veto-proof': New Alaska Senate minority promises to counter bipartisan majority. Alaska's News Source

All are issues that the Senate majority will support, and the Senate minority, the 19-member conservative-leaning House minority, and Gov. Mike Dunleavy will oppose.

 

Incoming Alaska Supreme Court chief justice applauds first female majority. Alaska Public Media

Male judges have dominated the court system since it was created, and it’s about time that, at least for a bit, there’s a majority of women on the Supreme Court. The Court of Appeals previously was all women, until a fourth judge was added.”

 

Why running the government like a business would be a disaster. The New York Times

Businesses and government do fundamentally different jobs, and efforts at remaking government with an eye to cost-cutting can end in disaster. That’s because a lot of what the government does is hard to quantify and involves complicated tasks that inevitably require bureaucratic coordination and, yes, inefficiency.

 

Why politicians' wealth matters. Axios

The economic background of political leaders influences how they govern — richer lawmakers generally push for policies that favor business interests and those of the wealthy. Politicians in the U.S., and around the world, have always  been wealthier than most Americans — yet even so, the wealth of the incoming Trump team is extraordinary.

(My comment: Not just the politician’s wealth, but that of their family as well. With Alaska’s unlimited political contribution limit, a wealthy family member can contribute millions of dollars to a campaign.)

 

Can you guess how these 10 ambiguous Ballot Measure 2 votes were counted? Alaska Public Media

 

 

Healthcare

America's health decline. Axios

The U.S. outspends other countries on health care by a landslide. But it's not buying us the longer, healthier lives that people in other countries enjoy. That will only become more true over time.

 

1 big thing: America's vanishing pharmacies. Axios

Independent pharmacies were likelier to close from 2010 to 2021, possibly because pharmacy benefit managers steered patients to their own in-network pharmacies, a study in Health Affairs found.

(My comment: In Alaska, the PBM industry has closed pharmacies in communities, leaving the citizens with no local place to purchase medications or get professional advice.)

Alaska Oil Resource Values

 

Alaska North Slope crude oil price (12/11/24): $71.96

FY24 budget (beginning 7/1) is fully funded at a

forecast of $73/barrel of oil.

Price on 9/30/23: $87.99

Price on 9/30/22: $86.91

Price on 6/29/22: $116.84

Price on 3/08/22: $125.44

Price on 12/22/21: $75.55

ANS production (12/10/24): 468,621 bpd

 

 

One unexpected oil tend: stability reigns. Axios

Brent crude oil prices exhibited a minimal average monthly change and a monthly range-bound movement between US$74 and US$90 per barrel in 2024, making 2024 one of the most stable years in the past 25 years," Deloitte, citing spot prices, said in a new report.

(My comment: Stable prices are great for consumers. Alaskans count on high prices and unstable world events to pay for our government services through taxes on oil industry. At the same time, Alaskans don’t want to be taxed themselves to pay for those services. Add to that, Alaskans want high oil prices to increase the annual check (Permanent Fund Dividend) that state government hands out. This is not a sustainable plan.)

 

China bans export of critical minerals to US as graphite mine near Nome pushes forward. KNOM

 

China export ban deals blow to U.S. economy. Mining News North

In a move that could deal a multibillion-dollar blow to the American economy and impact the nation's military readiness, China has completely banned the exports of gallium, germanium, antimony, and superhard materials to the United States.

(My comment: Tariffs on China make sense. Not tariffs on Canada and Mexico.)

 

AIDEA asks District Court to block leasing of land from its contested leases. Petroleum News

AIDEA's requested injunction comes within a court case in which the agency has appealed BLM's cancellation of AIDEA's ANWR leases in 2023, after the agency had determined that the environmental impact statement for the 2021 lease sale had been deficient.

 

A new study touts the economics of building the Alaska LNG Project, but some lawmakers have doubts. Alaska Public Media

North Slope and Southcentral Alaska with an estimated cost around $11 billion. And Swift said that’s on par, or a bit higher, than other pipeline projects currently in the works or recently completed that are being built in more populous areas.  “But Alaska and building in Alaska – there are other challenges that other pipelines that we see … do not have,” he said. “Just the weather and the harsh conditions. So it being slightly higher than that is a reasonable assumption to use. And it’s a conservative assumption to use.” 

 

Alaska development agency moves to provide $50M commitment to LNG project. ADN

It remains uncertain where the investment to build the megaproject will come from, one of the key questions that has halted Alaska gas line projects in the past. An oil and gas analyst this week predicted the project will be too costly to move to construction, which would require the state development agency to make the $50 million payment.

 

Five states drove record U.S. natural gas production in 2023. EIA

Five states produced more than 70% of the record 113.1 billion cubic feet per day (Bcf/d) of U.S. marketed natural gas production in 2023. Texas accounted for 28% of U.S. marketed natural gas production in 2023, according to our Natural Gas Monthly, followed by Pennsylvania (18%), Louisiana (10%), West Virginia (8%), and New Mexico (8%). Even though production slowed in 2024, output from these five states continued to make up most—73%—of marketed U.S. natural gas this year.

 

A "shocking" power demand forecast. Axios

Those eye-popping projections of electricity demand growth flying around? They might be too small.

 

Could low-carbon hydrogen fuel come from Alaska mines? Researchers are studying it. Alaska Beacon

Geologic hydrogen — gas that’s trapped underground or stimulated by injecting water into certain mineral deposits — is all the buzz right now. Boosters say it could revolutionize the global energy system as a potentially abundant source of low-carbon fuel — though it’s not yet proven at a large scale. 

 

Number of the say: $115 per kilowatt-hour. Axios

That's 2024's average price for lithium-ion battery packs, a 20% yearly drop that was the biggest in seven years, per new Bloomberg NEF data.

 

Precious Metal Prices

December 11, 2024

Gold - $2721.97

Silver - $32.14

Platinum - $957.22

Palladium - $1017.70

Rhodium - $4575.00

 

Alaska Permanent Fund

website

 

Fund value December 11, 2024 - $82,511,400,000

PFD payout from ERA, Fiscal years 1980-2024: $43.9 Billion

$100 Billion total earnings over lifetime of the Permanent Fund

Feedback is always welcome.

Have a great week!

 

Cathy 

 

Personal Contact:

907.465.4843

sen.cathy.giessel@akleg.gov

 

Past Newsletters on my website



My Staff:

·     Chief of Staff: Jane Conway (from Soldotna)

·     Office Manager: Paige Brown (from Anchorage/Girdwood)

·     Resources Committee Staff: Julia O'Connor (from Juneau)

·     Legislative Analyst: Angela Rodell (from Juneau)

 

 

Copyright © 2024. All Rights Reserved.

Senator Cathy Giessel's Newsletter | 12701 Ridgewood Rd | Anchorage, AK 99516 US