Alaska Dispatch

TO: Gov. Sean Parnell

Did you get a load of the Fraser Institute's 2009 Global Petroleum Survey yet? It asked oil and gas industry presidents, vice presidents, managers and consultants (plus a group called "other") to rate states and regions around the globe on how much the industry thinks those places deter investment. We just finished reading it, and man, are we concerned.

According to the survey, Alaska is the third least-appealing U.S. state for petroleum development. What's more, Alaska's offshore and onshore jurisdictions ranked 72nd and 78th, respectively, in the all-inclusive composite index. Not as bad as Venezuela (dead last worldwide), but we can do better, and The Concerned has figured out how.

The survey said Alaska's low composite ranking came largely from "investment barriers related to environmental regulations." But our state also fared poorly in the "geopolitical stability" index. One individual respondent even wrote something about Alaska that really worried us: "Notoriously corrupt government. Essentially a Third World country."

We thought that whole corruption thing was settled. Is there something else going on we should know about? But really, if corruption's so bad, why does the survey say that the industry thinks Alaska contains so many barriers to investment? If anything, it sounds like the corruption's not working well enough.

So, The Concerned started thinking. People who want to encourage oil and gas development in Alaska (and hey, who doesn't?) might be going about it all wrong. There are two ways to skin a wildcat.

The usual way is to say that Alaska should relax environmental requirements or tax structures, or both. So far, that strategy is proving ineffective at increasing investment. Production from the Trans-Alaska Pipeline is in decline, and each day we see new competition to our long-sought natural gas pipeline project. The Concerned thinks it's time to look at things backwards. Desperate times call for desperate reasoning.

Hypothetically, let's assume that Alaska's environmental requirements and fiscal terms are totally fair and equitable. We know that's not what the Fraser survey shows, but the state and the public don't have access to information that would prove our assumption false. And if true, it entails that regions outranking us on the composite index have unfair terms.

So, instead of urging Alaska to remove barriers to investment, The Concerned think the state should be lobbying other states and countries to bolster theirs. Every new barrier to oil and gas investment in the rest of the world will boost Alaska's prospects, we promise. Alaska can either stoop to a lower standard or bring the rest of the world up. Sure, it'll be a longer path to development, but it'll be worth it.

Governments in the Timor Gap region would be a great place to start. A leaky offshore oil well there has been spilling around 400 barrels a day since August, and it's still going strong, affecting bottom lines.

We hope you'll agree that there's very little reason for Arkansas (ranked first overall) or Austria (first outside the U.S.) to miss out while Alaska sits up to its neck in royalty cash and environmental safeguards. Please, we beg you, try something new.

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