Vote yes to repeal SB 21

By Dirk Nelson

History reveals why the multi-national oil corporations don’t merit the kind of trust extended to them by SB21. It legally requires – nothing – in increased throughput of oil or revenues to Alaska. I will be voting Yes to repeal SB 21 on Aug. 19
Let’s review just a portion of the major producers’ tainted history. There are some ethical questions at the core.
Go. Parnell pushed passage of SB21 in the Senate, winning by one vote, with two senators voting despite ethics conflicts concerning their employment with Conoco Philips. Pete Kelly voiced the objection to the ethics rules which would have caused the two Conoco senators to abstain from voting.
In 2013 those supporting SB21 promised increased oil throughput of 1,000,000 bbls/day; fallacies which are no longer uttered. They lied to win.
SB21 represents unwarranted trust in contractual relationships with the major producers. Examples include:
SB21 creates barriers for independent producers attempting operations on the North Slope, reinforcing the Big 3’s quasi-monopoly they’ve enjoyed for decades. North Slope competition, which was in place under ACES, benefits Alaska, but not the Big 3.
In the 1970s and 80s there was the Amerada Hess case; the producers were caught under-valuing our oil, cheating us of our share of its value. It took decades to resolve that theft.
Later came the TAPS settlement; the Big 3 had routinely over-charged independent operators for transporting their oil through the pipeline. Substantial time and money was spent to force the Producers toward honesty – again.
Following those cases were regulatory hearings wherein BP was found to have taken deductions multiple times. Later they’d be found to have inflated renovation costs, and attempting to drive up tariffs again.
Then came the Doyon case; the pouring of over 500 barrels of waste down dry wells on the North Slope. Those convicted named Randy Ruedrich as their instructor in that crime. BP was fined for their hesitation in reporting.
During the corruption investigations, then-CEO Jim Bowles (Conoco) sat in a Baranof Hotel room, being recorded by the FBI, as Bill Allen of VECO discussed the scheme to rig legislation, linking the Big 3 to VECO’s legislative bribery scheme involving a tax structure nearly identical to the tax structure within SB21, and resulting in State legislators being sentenced to prison.
Since 2006, the Producers have appealed the TAPS property evaluations and assessments every year, losing every appeal. The property owners in affected communities, including Fairbanks, have footed the bill for legal representation to battle Alyeska’s bogus claims. The courts have annually ruled in favor of significantly higher evaluations than those sought by Alyeska (and the Parnell Administration).
During petitioning for ballot status for the referendum, the Big 3 routinely claimed to be paying 35 percent in Federal Corporate withholding taxes. The federal GAO published research indicating the greatest they paid was 11 percent, and as little as zero percent.
Econ 1 presented data that claimed North Dakota is more profitable for the Producers, but managed to omit fees paid to property owners there, as well as transport costs. That fallacy was set straight when Sen. Stedman, R-Sitka, presented his data to the Senate Finance Committee, including those numbers omitted by Econ 1. Comparing North Dakota’s system to SB21, using Alaska’s FY2015 throughput forecast, North Dakota would receive approximately $1.45 Billion dollars more than Alaska.
BP now tells us they maintain over 80 percent Alaska-hire. They leave out the fact that most labor on the Slope is contracted; the rate of Outside hire there ranges from 50-70 percent, whether under ACES or under SB21.
Conoco, Exxon and BP, through ‘No on 1,’ flood our televisions and radios with $12 million in advertising, trying to convince Alaskan voters it benefits us to relinquish control of our hydro-carbon resources. Conoco and BP tell us they’re Alaska’s Oil Company, but their millions in checks for ads are signed in Texas, Los Angeles and London.
Then there’s the suspect numbers used to arrive at Scott Goldsmith’s conclusions in a “study” Northrim paid $100,000.00 for cherry-picking at its finest.
The history of these companies in Alaska emphasizes why control over our resources should remain in the hands of Alaskans, not the multi-national corporations. It is our oil and the revenue should remain here, not be exported to Texas, L.A. or London.
That’s why I’ll be voting “Yes!” on Proposition 1 on Aug. 19.
It’s OUR oil and we deserve better!!

Dirk Nelson is a 36-year Alaska resident, a former licensed clinical social worker, former licensed marriage and family therapist, married for 25 years, father of three Alaska-born children, a gardener, hunter, fisher-person, and reluctant political activist residing not too far from Fairbanks.

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Posted by on Jul 1st, 2014 and filed under Point of View. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

3 Responses for “Vote yes to repeal SB 21”

  1. Repentant Texan says:

    Mr. Nelson, I just want to cry as relief as your article is so dead on. I have been trying to tell folks just how bad it will get here if sb21 actually goes thru, but nobody is hearing me. I get the feeling they either don’t care or they see dollar signs and can’t wait for the onslaught to begin. Sad really.
    I am essentially cutting my own throat by begging people to hear my plea since I moved here for no other reason but to suck oil & gas out of the ground as quickly as possible and that is my sole way to make a living. So, when I’ve had folks tell me that I just want to roll up the carpet, like others do I guess, so progress can’t get a foothold in Alaska, that angers me. Especially since I come from Texas, the biggest cesspool, other than Louisiana, and I just want everyone to know that Alaska MUST be kept pristine for as long as possible. I feel you understand this and I cannot be more happy. A boulder has been lifted off me and I don’t feel alone anymore. I hope thousands of people hear you also. Your karma is so great I can tell you that you are metaphysically wrinkle free. The Universe will do good to make your voice loud enough for the willfully deaf and make them realize the harm sb21 will do to Alaska.

  2. Jo says:

    Whether ACES or SB21 were responsible, Alaska suffered a huge drop in revenue from the oil companies.

    As I researched the exact reason for this, I found that the oil companies declared that their productions costs had doubled.

    There is no stated reason for production costs increasing this drastically, and there have been no audits of the oil companies since Sean Parnell has been in office.

    This would lead anyone who follows Ronald Reagan’s ‘Trust, but verify’ to ask…wait, whaaat?

    No audits, just trust the oil companies? The same oil companies caught cheating Alaska in the past?

    Is this what Hickel and Hammond did in office, just trust the oil companies to pay what they want for the state’s revenue?

    What is even more frightening is Parnell and AKleg’s plan to use the rest of Alaska’s money on a $65 Billion gas pipeline, quite possibly from the permanent fund, but at the very least from any future revenue as the oil companies will overstate the costs to build this pipeline and subtract that from any future revenue to the state.

    This would not be the first time that the oil companies inflated their costs to pay less in tax, only the federal government actually caught them. (google- Judge: Oil companies ‘cavalierly’ wasted hundreds of millions on pipeline work) The state of Alaska did nothing to follow up on this.

    The pricetag $65 Billion should raise alarms everywhere. China is planning the world’s most expensive pipeline for $30 Billion which goes from Russia through China to India, through the himalayas.

    Like Bankers with the bailout, these Big Oil Fat Cats just wanted to pick a really big number to pad their bank accounts and further the rapid looting of Alaska.

    If anyone trusts Parnell and these Bill Allen leftovers in the Alaska legislature to write a fair bill for oil taxes, or trust them to make deals with a future gas pipeline….you just haven’t been paying attention.

    If you had watched the legislative session, how they labored over education spending during their self created deficit spending, meanwhile giving unneeded money for the Knik Bridge (hello Veco?), the U-med road no one in the district wants, a new $250 million coal plant for Fairbanks where they already have trouble breathing in the winter

    Why now of all times do we need a road out of Juneau? (which really leads to a gold mine and a new planned Ferry Terminal even as the legislature cut funding to the Ferry system)

    These people are not trying to help the state. They are attempting to loot the state as fast as possible because the think everyone is too stupid to pay attention to what they are doing until it is too late.

    Well, are we? Are we too stupid to pay attention to what these criminals are doing to our state? Are we too busy and too self centered to protect Alaska’s great wealth and resources for future generations?

    Whether you believe facts, or have faith in oil companies and oil lobbyist governors…it is time for all Alaskans to pay attention to how we vote.

    In 2004, 16 out of 40 districts had 200% voter turnout. Looks like something went wrong with the diebold accuvote counters, or perhaps the vote count was changed as it was sent through the diebold central tabulators. Under complaint, the state was forced to admit the numbers might have been changed by some unknown person using the password ‘password’ and nothing has been fixed(in the voting process) since then. (google-Bradblog or Shannyn Moore ‘Alaska elections’)

    If Alaskans want to make sure their vote is counted accurately in such an important election, both August and November, we must demand that our paper ballots are hand counted at the precinct before they are put through diebold accuvote counting machines. The totals need to be posted at the precinct level before they are put through the diebold tabulator so that they can be verified in the event of another 200% voter turnout.

    After all, what is the point of this debate or voting at all, if they will cheat? If they can cheat, they will, and Alaska’s voting system is all set up for it. Pay someone $100,000 to hack a computer to make billions, what would you do if you were them (remember $$ is their only God/no morals whatsoever)

  3. Dirk Nelson says:

    To be clear, and for sheer purpose of clarification, I’m not anti-development or anti-oil. Nor is my own past entirely unblemished.

    But I -am- anti-theft and anti-irresponsible development.

    The history of these specific companies (commonly referred to as the Big 3) is one of dishonesty and irresponsible behavior. Responsible development would not see the infractions that have occurred; the list above being a mere -partial- listing of their more egregious antics.

    I contend that to do business with such entities without requiring clear and defined benchmarks is to agree to play poker with Soapy Smith in his own club, or to leave a fine brick of aged cheddar in a cage of hungry rats; neither results in anything good or promising for the third party engaging in such antics.

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