I noticed a glaring omission in Sen. Lisa Murkowski's Jan. 13 commentary about the new Congress: Any mention of oil development in the Arctic National Wildlife Refuge. Murkowski touts the new Congress' priorities, yet the Republicans' top priority -- literally, it is entitled "Senate Bill 1" -- is to permit a pipeline for development of Canadian oil from Alberta's tar sands. Murkowski needs to start representing Alaska, not just take orders from D.C. power brokers.
All of us who participated in Alaska's oil tax debate understand that oil companies make investment decisions based on marginal profits. Murkowski and the Republicans' Keystone XL push undoubtedly will help Canadian oil fields by reducing transportation costs from Canada. But if they're successful, that could actually divert funding from the North Slope by making Canada more competitive compared to Alaska. Taking away investment from the North Slope would make our Trans-Alaska Pipeline System throughput problem even worse over the next decade.
In turn, reducing TAPS throughput would make our state budget situation even worse. By making Alaska less competitive, the Keystone XL bill would have both direct negative effects on our economy and also negatively affect our state budget.
During the campaign, Murkowski and Sen. Dan Sullivan bragged they could open ANWR. Yet Murkowski hasn't even tried to add ANWR development to the Keystone XL bill (SB1). Most Alaskans would agree that if Congress is going to pass one bill promoting oil development, we should develop American and Alaska oil. Instead, Murkowski is just following orders from D.C. lobbyists who direct campaign funding to Keystone supporters.
It's time for Murkowski to start setting an agenda based on Alaska priorities, not take orders from lobbyists who haven't even been here on a cruise ship. Murkowski claims her position on the Energy Committee gives her clout, yet her top priority is a bill to help Canada at the expense of Alaska's oil fields.
Alaskans are politically savvy, and understand that the only way we're going to get ANWR development approved is by attaching it to must-pass legislation. If Keystone is a "must-pass" bill, then why won't Murkowski demand that it also approve ANWR development? If anything, adding ANWR development should make the bill more popular because at least it'd be promoting American energy development.
Much has changed over the last few months with respect to Keystone. Back when oil was $100 per barrel, the tar sands of Alberta were going to get developed regardless of whether the pipeline was approved. At those high oil prices, tar sands are profitable whether the crude is trucked, piped, or shipped by rail. However, when oil is below $70 per barrel the tar sands aren't as profitable unless a pipeline like Keystone XL can significantly reduce transportation costs. Therefore, when Murkowski pushes Keystone XL amid low oil prices she's helping bring Canadian fields online that directly compete with Alaska oil while further depressing global oil prices.
Alaska is facing a budget crisis due to declining oil production and declining oil prices. The last thing we need is a senator whose Canada-first policies discourage North Slope investment and continue to flood the global market with cheap oil.
It is disappointing that Murkowski is neglecting Alaska energy development as she uses her committee position to help Canadian oil fields. She should be standing up for us, not taking orders from D.C. lobbyists who couldn't care less about Alaska.
Mike Wenstrup is chairman of the Alaska Democratic Party.
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