Thank you for your interest in investing in Alaska.This is a state rich in opportunities and we look forward to working together to responsibly develop the state’s oil and gas resources.

Highlighting Alaska’s resource opportunities and the stable nature of our regulatory and tax regimes is an important goal of my administration.We recognize that your investment in this state is important to our future.We want you to know that your presence in Alaska is appreciated and your input is always welcome.

We hope that you will also find the development of Alaska resources to be in your best interests — from the North Slope south to the Alaska Peninsula.We are proud to have long-time companies continuing to invest in our state and profit from their exploration, and we are also excited to see new and returning companies willing to invest, such as Shell, Pioneer, ENI, Benchmark, Savant,Total and others.They recognize the exciting environment that exists in Alaska, and they are companies committed to forging new relationships in the Last Frontier and initiating investments in this rich environment.

As Alaska’s governor, one of my very first pledges during the first month in office was to ramp up responsible resource development. I know that’s a goal under which we both can live. I promise to vigorously defend Alaska’s rights, as resource owners, to develop and receive appropriate value for our resources. But I also know that the state should be trusted to keep its promises and I will expect the same of the industry. Oil and gas development remains the core of our state.We recognize that one thing we can do for you is to provide stability for our developers.

We have numerous resource development priorities over the next few years of my administration.The number one priority is ensuring the construction of the North Slope natural gas pipeline.We know that Alaska’s gas can be developed profitably and begin to flow from the North Slope to commercial markets in this state and throughout the Lower 48.We are no longer going to accept the warehousing of Alaska’s gas.

We are moving forward aggressively to bring to market this valuable resource and provide a safe and secure domestic supply for our homes and businesses as well as those in the Lower 48.

We also recognize that while Alaska’s gas pipeline will first flow our proven gas reserves,we must strongly encourage exploration and expansion.Whether it is the North Slope or Cook Inlet,Alaska is demanding greater access to facilities in order to enhance expansion opportunities for current investors and future investors.

We are excited about many great prospects, and naturally our focus is on energy supplies because we are blessed with them. Members of my administration and I look forward to answering your questions and partnering in a way which will respect our land and provide a promising future for the state and those who are willing to invest in the exploration and development of our resources.

Thank you, again, for your interest.
Sincerely,

Sarah Palin
Governor of Alaska

Visit Dispelling the Alaska Fear Factor Download Page

This is the first and only comprehensive guide to Alaska’s oil and gas basins and business environment. The purpose of the guide is to give potential oil and gas investors the information they need to make investment decisions – or point to where they can find the information. Individuals coming to Alaska to work for oil companies and service firms can find pertinent information about Alaska's oil patch, including what it's like to live in the state

Download Dispelling the Alaska Fear Factor: A guide to Alaska's oil and gas basins and business environment

PDF format, 23.5MB, 243Pages.

Message from the publisher:

The first biennial edition of “Dispelling the Alaska Fear Factor”was published in May 2005.The book was designed to report on government and industry efforts to dispel the “Alaska fear factor,” which had discouraged many oil companies from doing business in the state.

The first edition also provided what the second part of its title promised:“A guide to Alaska’s oil and gas basins and business environment.”

Because of the success of newcomers such as Armstrong Oil & Gas, Pioneer Natural Resources and Kerr-McGee, the second edition of the book, published in May 2007 (which you are reading), has much less information about the “Alaska fear factor.”

Armstrong proved a tiny independent from “Outside” could purchase leases in Alaska (offshore the North Slope, no less), identify drillable prospects near existing infrastructure, find partners to help finance exploration, and discover commercial quantities of oil and gas.

Pioneer and Kerr-McGee were two of Armstrong’s partners. Using the Alaska expertise Armstrong had under contract and adding some of its own, Pioneer took over as operator of the Armstrong-identified Oooguruk prospect, discovered by the partners in 2003 and expected to come online in 2008.

Kerr-McGee’s story is similar.The company, which is now part of Anadarko Petroleum, came into the state as an Armstrong partner in late 2003 to drill the near-shore Nikaitchuq prospect in early 2004 where it discovered commercial quantities of oil.

Development was initially scheduled to match Oooguruk’s, but a number of things interfered with that, including Armstrong’s decision in 2005 to sell its interests in all its Alaska assets to yet another company new to Alaska, Houston-based Eni Petroleum, the U.S. E&P affiliate of Italy’s Eni SpA.Armstrong President Bill Armstrong said his firm did not have deep enough pockets to be a good partner in developing the two discoveries.

Eni soon made a reportedly generous, and successful, offer to Anadarko for Nikaitchuq. In April 2007, Eni said it was targeting the end of 2007 for project sanctioning, with first oil to flow by the end of 2009.

Newcomers to the more remote National Petroleum Reserve-Alaska face the stuff the Alaska fear factor is made of — absence of infrastructure, short winter drilling season and high costs.Talisman subsidiary FEX L.P. is on its second winter drilling season as an operator in NPR-A.

The Calgary-based company has made a significant petroleum discovery in this farflung part of the North Slope, and is talking in the hundreds of millions of barrels.

A tiny independent, BRPC Group, also discovered oil at one of its two North Slope exploration wells in the winter of 2006-07.The North Shore No. 1 encountered approximately 70 feet of oil-charged Ivishak sandstone formation north of the Prudhoe Bay oil field.

Which brings me to another subject: the rewards. The payoff in Alaska in terms of size of a discovery is large by any standard, especially anywhere else in Canada and the United States. Nikaitchuq is thought to hold between 100 million and 200 million recoverable barrels of oil; Oooguruk around 70 million barrels.

Enough said.The next step is to subscribe to Petroleum News and get a weekly news update and access to our extensive story archives. Many thanks to all the individuals in government agencies and private companies who contributed to “Dispelling the Alaska Fear Factor:A guide to Alaska’s oil and gas basins and business environment.”

Kay Cashman
Petroleum News publisher & executive editor

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