Legislature(2009 - 2010)HOUSE FINANCE 519

04/14/2010 08:30 AM House FINANCE

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-- Continued at 8:00 pm Today --
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Moved Out of Committee
Moved Out of Committee
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SENATE BILL NO. 305                                                                                                           
     "An Act relating to the tax on oil and gas production;                                                                     
     and providing for an effective date."                                                                                      
1:46:04 PM                                                                                                                    
Co-Chair  Hawker   explained  that  SB  305   addresses  the                                                                    
decoupling of  oil from gas  as related  to the oil  and gas                                                                    
production tax  and the interplay  of the issue  with Alaska                                                                    
Gasline   Inducement   Act   (AGIA)   legislation   in   the                                                                    
forthcoming open season. He reported  that the bill had been                                                                    
thoroughly  vetted  on  the  Senate   side  with  a  lot  of                                                                    
technical  analysis   and  that  the  bill   had  also  been                                                                    
carefully reviewed in the House Resources Committee.                                                                            
Co-Chair Hawker stated his intent  to accomplish the mission                                                                    
of  the sponsors.  He anticipated  a  difference of  opinion                                                                    
from  the administration  on the  necessity  of passing  the                                                                    
bill.  He  outlined his  plan  for  the  bill in  the  House                                                                    
Finance Committee.                                                                                                              
1:50:55 PM                                                                                                                    
SENATOR  BERT STEDMAN,  CO-CHAIR, SENATE  FINANCE COMMITTEE,                                                                    
SPONSOR,  provided  an  overview   of  the  history  of  the                                                                    
legislation. His  initial concern  was looking at  the issue                                                                    
from a  fiscal position and  determining that the  state was                                                                    
potentially  at  a  fiscal  disadvantage  at  the  level  of                                                                    
billions  of  dollars.  He   recognized  the  difficulty  of                                                                    
communicating  the magnitude  of the  fiscal challenges.  He                                                                    
explained Senator Paskvan's  role as a legal  advisor on the                                                                    
legislation. He  believed Senator Paskvan had  the advantage                                                                    
of  entering the  legislature after  the discussions  on the                                                                    
Petroleum   Production  Tax   (PPT),   Alaska's  Clear   and                                                                    
Equitable Share  (ACES), and AGIA;  he believed a  fresh eye                                                                    
would be helpful.                                                                                                               
1:54:13 PM                                                                                                                    
Senator  Stedman  referred  to   the  time  when  the  state                                                                    
functioned under the Economic Limit  Factor (ELF) or tax and                                                                    
royalty  regime  and  was  transitioning  to  a  production-                                                                    
sharing  arrangement.   He  noted  that  North   America  is                                                                    
basically structured under the  tax and royalty approach and                                                                    
most  of  the  global hydrocarbon  basins  have  production-                                                                    
sharing  or profit-sharing  arrangements.  He recalled  that                                                                    
after  extensive legislative  review of  the ELF  structure,                                                                    
the fiscal  regime of Alaska was  restructured to production                                                                    
sharing. He noted that months  were spent in the legislature                                                                    
adjusting   the  new   structure,   especially  related   to                                                                    
progressivity.  The  royalties  had   been  left  in  place;                                                                    
however, it became  clear that the share going  to the state                                                                    
would decline  when the price  of oil  went from $60  to $80                                                                    
per barrel. Concern about the  decline led to progressivity,                                                                    
an added  tax that would  protect the state when  oil prices                                                                    
were high.  The decision had  been made  to stop the  PPT at                                                                    
$60 per  barrel; in  hindsight that was  too low.  There was                                                                    
debate about progressivity.                                                                                                     
Senator  Stedman referred  to  negotiations for  a gas  line                                                                    
under the  Murkowski administration  and a proposal  to take                                                                    
20 percent  of the gas  (12.5 percent of royalties  plus 7.5                                                                    
percent severance),  own 20 percent  of the pipe, have  a 20                                                                    
percent capital credit, and a  20 percent base tax. The base                                                                    
tax was increased  to 25 percent. At the time,  there was no                                                                    
gas  to  speak  of.  Cook   Inlet  was  separated  from  the                                                                    
discussion as  an old, declining  basin; the new  tax regime                                                                    
did not apply to  it. The only gas in the  state was in Cook                                                                    
Inlet and  in the Arctic. The  gas field in Prudhoe  Bay was                                                                    
going  to  be  taken  in-kind.  All  of  the  focus  of  the                                                                    
discussions at  the time was  on oil. Gas  was intentionally                                                                    
set aside.                                                                                                                      
1:58:09 PM                                                                                                                    
Senator  Stedman   continued  that  adjustments   were  made                                                                    
through ACES and AGIA; the  20 percent ownership in pipe and                                                                    
the 20 percent ownership in  gas fell away. However, the gas                                                                    
tax structure was still left in place.                                                                                          
Senator   Stedman  underlined   that  the   legislature  had                                                                    
structured progressivity  around oil. He described  gas as a                                                                    
lower-valued  hydro-carbon;  oil  produces  six  times  more                                                                    
energy per volume  than gas, and is eight or  ten times more                                                                    
valuable. In  the eight to ten  range there is not  a lot of                                                                    
impact on  the fiscal  regime. There  has been  a structural                                                                    
change within the  economy and the energy world  in the past                                                                    
three or four past years.  Vast supplies of natural gas have                                                                    
been  discovered globally,  lowering  the  pressure on  gas,                                                                    
while upward  pressure has been  put on oil.  Currently, oil                                                                    
is valued at about $80 per barrel  and gas is at $4, a 20 to                                                                    
1 ratio.                                                                                                                        
Senator  Stedman relayed  that a  couple of  years ago,  the                                                                    
Legislative Budget  and Audit  Committee found  a consultant                                                                    
to make  a mathematical model  of Prudhoe Bay,  Kuparuk, and                                                                    
Alpine  fields so  that the  legislature  could measure  and                                                                    
evaluate  a potential  gasline  proposal.  He had  requested                                                                    
that the  consultant review  the oil  tax structure  and the                                                                    
gas  tax structure  and measure  the offset  (or subsidy  or                                                                    
dilution) resulting from large  gas volumes and oil volumes;                                                                    
the total revenue was going down instead of up.                                                                                 
Senator Stedman referred to a  March 2, 2010 memorandum from                                                                    
Dr. David  Wood, a  consultant to  the legislature  (copy on                                                                    
file) calculating the impact over  the past couple of years.                                                                    
Dr. Wood had  presented his findings to  the House Resources                                                                    
Committee. Some  believed the policy implications  were huge                                                                    
and asked  for a presentation before  the Legislative Budget                                                                    
and Audit Committee.                                                                                                            
Senator  Stedman   reported  that  he  had   become  greatly                                                                    
concerned about  Dr. Wood's analysis of  the dilution effect                                                                    
in terms  of the fiscal impact  to the state but  also about                                                                    
the lack of recognition in  the legislature of the potential                                                                    
impact.  He  emphasized  that  the  mechanism  is  extremely                                                                    
complicated and the numbers are unbelievably large.                                                                             
Senator  Stedman continued  that the  AGIA open  season came                                                                    
around and Mr. Tony Palmer  from TransCanada came before the                                                                    
legislature to  discuss potential costs of  a mainline pipe.                                                                    
Mr.  Palmer   referred  to   estimated  tariffs   and  price                                                                    
2:03:50 PM                                                                                                                    
Senator  Stedman maintained  that under  the AGIA  terms the                                                                    
state faced a contractual obligation  to lock in the gas tax                                                                    
by May 1,  2010. He noted that the state  has the ability to                                                                    
adjust oil tax up or down, but not gas tax.                                                                                     
Senator Stedman explained that  the Senate Finance Committee                                                                    
had spent several weeks  studying the information available,                                                                    
starting with  the basic structure  of the oil and  gas tax.                                                                    
Oil was covered in the  first week and then the hypothetical                                                                    
4.5  billion cubic  feet  per day  (Bcf/day)  gas model.  He                                                                    
underlined  that  the  conclusions were  "not  pretty."  The                                                                    
administration did a review as  well, but their numbers were                                                                    
not any better.                                                                                                                 
Senator  Stedman  emphasized  that  the  state  had  a  good                                                                    
revenue  stream with  oil, but  when  oil is  15 times  more                                                                    
valuable than  gas, the total  dollars to the  treasury went                                                                    
down  with gas.  He was  alarmed  that the  state has  spent                                                                    
thirty  years  waiting for  a  gas  line  and a  strong  gas                                                                    
economy, when it  was clear that without  gas revenue, there                                                                    
would be no gas economy.                                                                                                        
Senator Stedman  pointed to current numbers,  stressing that                                                                    
what  matters  is  the  relationship  between  oil  and  gas                                                                    
prices. With oil  standing alone, the state  would make $8.6                                                                    
billion;  with  gas,  the state  would  make  $330  million.                                                                    
Noting that  the progressivity calculations are  based on 30                                                                    
days, with 30  days before first gas at ten  to twelve years                                                                    
out, the  revenue stream would  be $8.6  billion (annualized                                                                    
over 12  months). Given that  number, the  legislature might                                                                    
work the budget details.                                                                                                        
2:08:22 PM                                                                                                                    
Senator  Stedman continued  that first  gas could  come, and                                                                    
thirty days  later the  state might  find out,  for example,                                                                    
that  the same  volume of  oil (500,000  barrels) was  being                                                                    
pumped and gas was flowing  well, but the revenue would then                                                                    
be only $5.2 billion. He  warned that under the example, the                                                                    
state could  suddenly lose $3.4  billion and make  only $330                                                                    
million in gas. The net loss  could be $3.1 billion. The gas                                                                    
line would have  to be shut down and there  would be serious                                                                    
budget  problems. Nothing  could be  done because  the state                                                                    
would be under contractual  obligation for the following ten                                                                    
Senator Stedman questioned how  the legislature could answer                                                                    
to  future generations  for such  a  significant loss  after                                                                    
waiting thirty to forty years  for gas to flow. He commented                                                                    
that  he  and  other  legislators  had  traveled  throughout                                                                    
Canada  and  the United  States  to  energy conferences  and                                                                    
looked   carefully   at   the   models.   There   had   been                                                                    
consideration  about  how  to   incentivize  an  oil  basin,                                                                    
including  adjusting progressivity,  production-sharing, and                                                                    
base tax numbers or shifting  property taxes for things like                                                                    
a gas treatment plant.                                                                                                          
Senator Stedman  stressed that the Arctic  has a world-class                                                                    
oil  basin. He  argued that  the state  was not  creating an                                                                    
incentive,  but  giving  away   revenue  at  a  "staggering"                                                                    
magnitude.  For  example,  the  state  could  build  a  $100                                                                    
million road to encourage  drilling and exploration or build                                                                    
a port at Anchorage for  several hundred million. He did not                                                                    
want the state  to give away billions of  dollars year after                                                                    
Senator Stedman  suggested buying equity in  a project, such                                                                    
as buying  10 or 20 percent  of the pipe, so  that the state                                                                    
would make  the 12  or 13 percent  regulated rate  of return                                                                    
rather than handing the cash to others.                                                                                         
Senator Stedman emphasized that  the problem was the quickly                                                                    
approaching lock-down date on May  1, 2010, the first day of                                                                    
binding open season.                                                                                                            
2:14:04 PM                                                                                                                    
Senator Stedman warned that the  magnitude of the problem is                                                                    
so severe that  if AGIA succeeds and the  first binding open                                                                    
season succeeds, the industry could  lock the state down and                                                                    
it  would be  "game  over."  He pointed  out  that the  only                                                                    
leverage the state has left is  oil, if gas cannot be moved.                                                                    
He argued  that politically, oil  taxes could not  be raised                                                                    
by one third (the amount required  to make up the gap in the                                                                    
previous example).  Compared to other structures  around the                                                                    
world, he believed the current  tax structure in Alaska is a                                                                    
burden. He felt that the  state was currently giving its oil                                                                    
away  and  that oil  revenue  had  to be  protected  through                                                                    
adjustments and incentives,  and the gas pipeline  had to be                                                                    
made competitive and attractive.                                                                                                
Senator Stedman  stated that he  did not want the  legacy of                                                                    
giving away  the state's  oil. He noted  that the  state can                                                                    
legally decouple  at any time, but  he argued that if  it is                                                                    
done before  May 1,  2010, there would  be less  fiscal risk                                                                    
than  waiting until  after the  date. He  thought the  state                                                                    
could gamble that the price of  gas would go higher than the                                                                    
price  of  oil,  but  he   did  not  think  the  projections                                                                    
supported such a gamble. He  believed there would be higher-                                                                    
valued  oil  and lower-valued  natural  gas  because of  the                                                                    
amount of gas available.                                                                                                        
2:18:43 PM                                                                                                                    
Co-Chair Hawker  stated for the  record that he  agreed with                                                                    
the problem  identified by Senator Stedman.  He relayed that                                                                    
he had participated in the  discussions about PPT, ACES, and                                                                    
AGIA.  In 2006,  there was  a session  during which  the new                                                                    
proposal for  the profit-sharing production tax  was vetted.                                                                    
He noted that  it had been universally  appreciated that the                                                                    
ELF  had  become  outdated  and needed  to  be  replaced.  A                                                                    
special  session  was  called where  the  debate  continued.                                                                    
During  the interim  between two  special  sessions, he  and                                                                    
others met  to consider  the deadlocked bill;  the "producer                                                                    
pay plan" was crafted as  an evolution of the profit-sharing                                                                    
production  tax involving  an incentive  to lower  tax rates                                                                    
for producers increasing production.                                                                                            
Co-Chair Hawker continued that the  new bill made it through                                                                    
the House  and was  fine-tuned by  the Senate;  the producer                                                                    
pay plan  developed into  the profit-sharing  production tax                                                                    
(PPT).  The  bill  was  crafted   in  his  office  with  the                                                                    
Department of Revenue  (DOR) to address the oil  ELF, but as                                                                    
time passed,  it became clear  that the gas ELF  also needed                                                                    
to be  addressed through a  different formula.  He witnessed                                                                    
that the crafters  of the legislation had  believed they did                                                                    
not have  to worry about the  gas tax for another  15 years.                                                                    
They understood that  it would be complex  to structure both                                                                    
a new tax  on oil and on  gas and decided to  put them under                                                                    
the same  tax regime, although  there was a  different price                                                                    
structure on  oil than on  gas; one  was sold by  the barrel                                                                    
and the  other by  thousands or millions  of cubic  feet. In                                                                    
addition,  there was  a  significant  value difference.  The                                                                    
same tax rate could not be put on the different values.                                                                         
Co-Chair Hawker recalled that the  crafters came up with the                                                                    
idea of the British  Thermal Unit (BTU) equivalency formula.                                                                    
However, that  would work  only if  the BTU  equivalency was                                                                    
the same as the price  equivalency. They knew that combining                                                                    
low-value gas and  high-value oil would result  in a diluted                                                                    
tax structure,  but knew also  that there would be  15 years                                                                    
to deal with the problem.                                                                                                       
2:23:13 PM                                                                                                                    
Co-Chair Hawker  noted that the progressivity  feature added                                                                    
by  ACES exacerbated  the problem  as it  triggered profound                                                                    
value  differences.  Next,  AGIA  was  passed  and  provided                                                                    
"fiscal certainty"  for the players: the  gas-production tax                                                                    
would be fixed at the start  of the first day of the binding                                                                    
open season.  The lock-in  provision based  on the  start of                                                                    
the first  open season  suddenly reduced  the 15  years they                                                                    
had  previous assumed  they had  to 15  months. He  admitted                                                                    
that when AGIA  passed, he had not made  the connection that                                                                    
the time would be shortened.                                                                                                    
Co-Chair Hawker agreed that on  May 1, 2010, the state would                                                                    
be locked  in to  the gas  tax structure  for ten  years. He                                                                    
emphasized  that  the  crafters  of the  structure  had  not                                                                    
intended the outcome.                                                                                                           
SENATOR  JOE  PASKVAN informed  the  committee  that he  had                                                                    
arrived at the same  conclusion as Senator Stedman regarding                                                                    
the  need  for decoupling  gas  and  oil.  He had  begun  by                                                                    
reading the  AGIA statutes to  understand the extent  of the                                                                    
lock-in that the state was facing  on May 1. He had reviewed                                                                    
the  opinion  of  Attorney General  David  Marquez  and  his                                                                    
analysis under the Stranded Gas  Development Act of the risk                                                                    
to the state of Alaska.                                                                                                         
Senator  Paskvan reported  that  he had  called the  current                                                                    
Attorney General  Dan Sullivan two  months ago and  told him                                                                    
he believed there was a tremendous  risk and that he was not                                                                    
legally  comfortable  with.  He emphasized  that  the  legal                                                                    
issues were complex. He thought  the number one issue before                                                                    
the  current legislature  was the  fiscal  issue. He  agreed                                                                    
that  the magnitude  of the  problem  was so  great that  it                                                                    
could  result  in  Alaska  giving  up  100  percent  of  any                                                                    
production  tax  on  natural  gas and  100  percent  of  its                                                                    
royalty. The state  would have to use oil  savings while the                                                                    
gas flows.                                                                                                                      
2:27:57 PM                                                                                                                    
Senator Paskvan  stressed that the  monthly analysis  of the                                                                    
situation was  that Alaska would  be bringing in  about $725                                                                    
million per month in the first  30 days before the 4.5 Bcf/d                                                                    
of gas flows;  after the gas flows, the  state would receive                                                                    
less than  $500 million per  month. Hundreds of  millions of                                                                    
dollars would be lost each  month. He called the situation a                                                                    
"third-world  resource  extraction  model" where  the  state                                                                    
would pay while the resource leaves the state.                                                                                  
Senator  Paskvan argued  that decoupling  gas and  oil would                                                                    
result in  absolutely no  increase in oil  tax and  that the                                                                    
trigger point at  25 percent and the  slope of progressivity                                                                    
would remain  the same. The  gas tax would remain  the same,                                                                    
at  25 percent  with the  same slope  of progressivity.  The                                                                    
state would  be protected if  gas became more  valuable than                                                                    
Senator  Paskvan underlined  the conclusion  that decoupling                                                                    
is necessary. He added that  the only other issue before the                                                                    
legislature  was   the  question   of  the   methodology  of                                                                    
determining the  gas production tax  obligation specifically                                                                    
referenced in  AGIA statute  Section 320.  He referred  to a                                                                    
presentation by  DOR Commissioner  Pat Galvin to  the Senate                                                                    
Finance Committee.  Commissioner Galvin had used  the point-                                                                    
of-production  tax  (the system  put  in  by regulation  15,                                                                    
AAC.90.220) and  arrived at a gas  production tax obligation                                                                    
of $1.2 billion. Decoupling  and using a point-of-production                                                                    
analysis, using the same structure  used by the commissioner                                                                    
would allocate 78 percent of the  cost to oil and 22 percent                                                                    
of the cost to gas. The  tax obligation on a decoupled basis                                                                    
would be approximately $1,015,500.  He stressed that that is                                                                    
the beginning point for negotiation.                                                                                            
Senator  Paskvan concluded  that the  state should  keep its                                                                    
eye on the top line for  gross revenues for both products on                                                                    
a decoupled basis and then  look at the negotiation position                                                                    
by making  sure that  the starting point  is at  the billion                                                                    
dollar range.                                                                                                                   
Co-Chair Hawker noted that SB  305 was the proposed solution                                                                    
and would be presented by the consultants.                                                                                      
2:32:18 PM                                                                                                                    
Representative Gara commented on  the difficulty of shifting                                                                    
ideologies without  preconceptions. He noted that  with some                                                                    
language  changes  he  might agree  with  the  senators  and                                                                    
Representative  Hawker.  He pointed  out  that  he had  been                                                                    
present  throughout the  PPT and  ACES debates  and had  not                                                                    
been told once  that Alaska could have a gas  pipeline and a                                                                    
oil  pipeline  that  produced  less   revenue  than  an  oil                                                                    
pipeline alone. He believed the issue was very important.                                                                       
Representative Gara  stated that he, Senator  Hollis French,                                                                    
and others had tried to push  for separate oil and gas taxes                                                                    
and were told that it could  not be done. He wanted to enter                                                                    
into  gasline  negotiations   from  the  strongest  position                                                                    
possible.  He   listed  previous  concerns  that   had  been                                                                    
addressed,   including  that   it   made   sense  to   leave                                                                    
progressivity in.  He had committed  to let  industry deduct                                                                    
gas field  costs from oil taxes  in order to move  a gasline                                                                    
forward, and he  thought it would be wise  to craft language                                                                    
so that the small amount of  gas produced on the North Slope                                                                    
would  not  have  to  be burdened  with  decoupling  in  the                                                                    
Vice-Chair Thomas  stated concerns  about the timing  of the                                                                    
legislation; he  worried that the  House would not  have the                                                                    
time with  the legislation  that the  Senate had.  He agreed                                                                    
that the issue was huge. He  did not want to lose money, but                                                                    
he wanted  more information  about the  gas taxes  and urged                                                                    
proceeding with caution.                                                                                                        
2:37:34 PM                                                                                                                    
Senator Stedman pointed out that  currently there was cross-                                                                    
subsidy going  on as there  was gas  in the Arctic  and Cook                                                                    
Inlet as  well as  Prudhoe Bay-Kuparik, but  emphasized that                                                                    
SB 305  was revenue-neutral.  He recalled  that in  the last                                                                    
three  years the  impact to  the treasury  has been  roughly                                                                    
$250 million without gas. There  was language in the bill to                                                                    
protect  the   industry  so  they  would   get  the  current                                                                    
dilution.  The crafters  did not  want to  "rock the  boat";                                                                    
they wanted  to protect  the state from  being locked  in on                                                                    
May 1.                                                                                                                          
Co-Chair  Stoltze emphasized  the importance  of the  May 1,                                                                    
2010  date  and  the   consequences  of  the  administration                                                                    
deciding  not  to  sign the  bill.  Senator  Stedman  agreed                                                                    
regarding the importance of the date.                                                                                           
Co-Chair  Hawker   reported  that  the   administration  had                                                                    
testified that it views the problem as less severe.                                                                             
Vice-Chair Thomas queried what  could happen if the governor                                                                    
vetoed the  bill. He wondered whether  the legislature could                                                                    
override the veto in time.  Senator Paskvan did not know. He                                                                    
believed the effective date on the statute was January 1.                                                                       
Co-Chair  Stoltze  hoped  there   would  be  more  testimony                                                                    
related to the importance of timing.                                                                                            
2:42:07 PM               AT EASE                                                                                              
2:42:22 PM               RECONVENED                                                                                           
Representative  Fairclough believed  there  was time  before                                                                    
May 1 to fully understand the issue.                                                                                            
Co-Chair Hawker pointed to  extensive testimony and analysis                                                                    
on the bill's website.                                                                                                          
ROGER  MARKS,  PETROLEUM  ECONOMIST,  LEGISLATIVE  BUDGET  &                                                                    
AUDIT  COMMITTEE,  introduced  himself and  his  partner  as                                                                    
being from Logsdon & Associates  and under contract with the                                                                    
Legislative  Budget  and  Audit   Committee  to  assist  the                                                                    
legislature in gas taxation matters.                                                                                            
Co-Chair Hawker queried their  qualifications related to oil                                                                    
and gas issues.  Mr. Marks replied that they  had worked for                                                                    
the Tax  Division of DOR for  many years on the  oil and gas                                                                    
production tax and issues of gas commercialization.                                                                             
CHUCK  LOGSDON, PETROLEUM  ECONOMIST,  LEGISLATIVE BUDGET  &                                                                    
AUDIT COMMITTEE,  added that  they had  over fifty  years of                                                                    
experience between  the two of them  in evaluating petroleum                                                                    
taxation related to the Alaska fiscal system.                                                                                   
Mr. Marks  provided a summary  of the premise  and rationale                                                                    
for the bill and a description  of how the bill works, using                                                                    
a PowerPoint  presentation, "SB 305: The  De-Coupling of Oil                                                                    
from  Gas for  the Oil  and  Gas Production  Tax, Logsdon  &                                                                    
Associates, House  Finance Committee, April 14,  2010" (copy                                                                    
on file). He began with Slide 2, "Acronyms":                                                                                    
     BBL       barrel                                                                                                           
     BCF       billions of cubic feet                                                                                           
     MMBTU     millions of BTUs                                                                                                 
     BOE       barrel of oil equivalent                                                                                         
Mr. Marks detailed that a barrel  (bbl) is how the volume of                                                                    
oil is  measured and the unit  of how oil is  sold. Billions                                                                    
of  cubic feet  (Bcf) refers  to how  the volume  of gas  is                                                                    
measured.  He explained  that  natural  gas contains  mostly                                                                    
methane but also butane and  heavier hydrocarbons; while the                                                                    
volume is  measured in cubic  feet, it  is sold in  terms of                                                                    
the millions of British  Thermal Unit (BTU) content (MMBTU).                                                                    
Finally, the barrel of oil  equivalent (BOE) puts gas on the                                                                    
same basis  of oil so  they can  be added up,  measured, and                                                                    
compared  by converting  MMBTUs of  gas  to bbls  of oil.  A                                                                    
barrel of oil has 6 million  BTUs; taking the amount of BTUs                                                                    
of gas  and dividing by  6 puts the gas  on a barrel  of oil                                                                    
equivalent (BOE).                                                                                                               
2:47:29 PM                                                                                                                    
Mr. Marks turned to Slide 3, "The Problem":                                                                                     
   • The progressivity part of the production tax rate is                                                                       
     based on per barrel oil or per BTU gas profitability                                                                       
   • Under current law oil and gas are combined for                                                                             
     calculating the progressivity                                                                                              
   • Oil is worth much more than gas                                                                                            
   • With a major gas sale, combining the lower value gas                                                                       
     with the higher value oil will "dilute" the per barrel                                                                     
     oil profitability:                                                                                                         
        - Driving down the progressivity factor                                                                                 
        - Materially reducing production taxes                                                                                  
Mr. Marks detailed  that there is currently a  base tax rate                                                                    
of  25   percent  on  the   oil  and  gas   production  tax;                                                                    
progressivity is added to that to  give a higher rate if the                                                                    
value of the oil or gas is above a certain rate.                                                                                
Co-Chair Hawker summarized  that when gas comes  on the unit                                                                    
higher values of the oil are diluted.                                                                                           
Mr. Marks reviewed Slide 4, "Oil vs. Gas Value":                                                                                
   • Now:                                                                                                                       
        - Gas: $4/mmbtu                                                                                                         
        - Oil: $80/bbl ($13/mmbtu)                                                                                              
   • Department of Energy forecast for 2020:                                                                                    
        - Gas: $8/mmbtu                                                                                                         
        - Oil: $120/bbl ($20/mmbtu)                                                                                             
   • Transportation cost deductions:                                                                                            
        - Gas: $5.00/mmbtu to Lower 48                                                                                          
        - Oil: $6.00/bbl ($1.00/mmbtu)                                                                                          
Mr. Marks detailed that on a  straight BTU to BTU basis, oil                                                                    
is currently  worth about  three times as  much as  gas. The                                                                    
U.S.  Department of  Energy forecast  for 2020  (when it  is                                                                    
hoped that a major gas  sale would start) is $8/MMBTU, while                                                                    
the  forecast for  oil  is around  $20/MMBTU,  or about  2.5                                                                    
times  as   much  as  gas.   In  addition,  in   Alaska  the                                                                    
differences  are exacerbated  by  transportation costs.  The                                                                    
tax  is based  on net  value. Gas  will have  a much  higher                                                                    
transportation cost than oil per  MMBTU, about five times as                                                                    
2:50:52 PM                                                                                                                    
Mr. Marks directed  attention to Slide 5, "How  the Tax Rate                                                                    
is Determined":                                                                                                                 
   • Base 25% rate                                                                                                              
   • Plus progressivity                                                                                                         
        - Progressivity is based on the net value per BOE:                                                                      
             • Oil Alone: Total oil value / Total oil                                                                           
             • Combined Oil & Gas: Total oil and gas net                                                                        
              value / Total oil and gas BOE's                                                                                   
        - When lower value gas is added to the higher value                                                                     
          oil the average net value of the combined oil and                                                                     
          gas goes down                                                                                                     
Representative  Doogan asked  whether  part  of the  problem                                                                    
would be a lot of  low-value gas compared to relatively less                                                                    
high-value oil. Mr. Marks responded  that he was correct and                                                                    
suggested thinking  of the relationship  as a  fraction with                                                                    
the numerator being the value  and the denominator being the                                                                    
amount of production.                                                                                                           
Representative  Doogan noted  that  a lot  of  the issue  is                                                                    
related to the  theory that there would be  a lock-down when                                                                    
companies  nominate gas  during  the open  season. He  asked                                                                    
whether  the problem  would be  exacerbated as  more gas  is                                                                    
nominated.  Mr. Marks  responded  that he  was correct;  the                                                                    
greater  the  difference  between  oil and  gas  value,  the                                                                    
larger the  problem, and the  more gas there is  relative to                                                                    
oil, the greater the problem.                                                                                                   
Mr. Marks  turned to Slide  6, "Reference Case," or  how the                                                                    
world might look in 2020:                                                                                                       
   • Oil                                                                                                                        
        - 500,000 barrels per day                                                                                               
        - $120/bbl market price                                                                                                 
   • Gas                                                                                                                        
        - 4.5 bcf/day                                                                                                           
        - $8/mmbtu market price                                                                                                 
   • Upstream costs                                                                                                             
        - $2.2 billion capital                                                                                                  
        - $2.2 billion operating                                                                                                
2:54:39 PM                                                                                                                    
Co-Chair Hawker  noted that the  same reference  numbers had                                                                    
been used  in the previous  committee. He asked  whether the                                                                    
upstream  operating  and  capital expenses  were  reasonable                                                                    
costs  to anticipate.  Mr. Marks  believed the  numbers were                                                                    
reasonable and  consistent with current costs,  adjusted for                                                                    
inflation  plus additional  costs  that may  occur with  new                                                                    
fields like Pt. Thompson.                                                                                                       
Representative Austerman  asked whether the  500,000 barrels                                                                    
per day was  taxable oil. Mr. Marks agreed;  the numbers are                                                                    
DOR's forecast for production in 2020.                                                                                          
Mr. Marks  moved on to  Slide 7, "What Happens  under Status                                                                    
   • Oil taxes under status quo prior to gas production:                                                                        
          Net value of oil = $86/bbl (tax rate 47%)                                                                             
          Oil Tax = $6.1 billion                                                                                            
   • Add a 4.5 bcf/day of gas:                                                                                                  
          Combined net value of oil and gas = $47/bbl (tax                                                                      
          rate 32%)                                                                                                             
          Total oil & gas taxes: $5.5 billionBottom line: The drop in the tax rate of oil more than                                                                 
     offsets all the  the taxes on gas. Not only does the                                                                       
     state not received any additional revenues from the                                                                        
     gas, but oil revenues drop as well.                                                                                        
Mr. Marks  detailed that the  numbers assume  oil production                                                                    
similar to  present levels and  no gasline,  500,000 barrels                                                                    
per day  and the  $120 Lower  48 price.  When the  costs are                                                                    
subtracted to  get to the  net or production tax  value, the                                                                    
net   value  is   approximately  $86/bbl.   Given  the   way                                                                    
progressivity works,  when the  amount above $30  is subject                                                                    
to  a 0.4  percent  slope per  dollar, the  tax  rate is  47                                                                    
percent  at $86/bbl.  The  tax rate  would  be $6.1  billion                                                                    
Mr. Marks  explained that  adding a  4.5 Bcf/day  gasline on                                                                    
top  of  the  oil  production  would  not  affect  oil;  but                                                                    
combining  the lower-value  gas  with  the higher-value  oil                                                                    
would reduce the $86/bbl average BOE value down to $47/bbl.                                                                     
Co-Chair Hawker asked whether the  scenario would occur when                                                                    
the  switch is  flipped on  and gas  is produced.  Mr. Marks                                                                    
agreed; the  prices would  occur when  the average  value of                                                                    
the oil  is diluted by the  gas. Without the gas,  oil would                                                                    
have  the  $86/bbl  tax  value   at  47  percent  tax  rate;                                                                    
switching on  the gas  would bring  the combined  value down                                                                    
from $86/bbl to $47/bbl (tax rate at 32 percent).                                                                               
Mr. Marks  highlighted that  the total  taxes would  then be                                                                    
$5.5 billion  for both the oil  and the gas. There  would be                                                                    
no additional taxes  from the gas and the  oil revenue would                                                                    
drop as well.                                                                                                                   
Mr.  Marks reported  that over  the past  months he  and Mr.                                                                    
Logsdon  had  looked   extensively  at  other  international                                                                    
petroleum fiscal regimes. They could  find no other place on                                                                    
the  planet  where  a jurisdiction  combines  substances  of                                                                    
different values and the basis  for taxation is the combined                                                                    
per unit value.                                                                                                                 
Co-Chair Hawker  clarified that the comparisons  referred to                                                                    
annualized  numbers.  Mr.  Marks concurred,  and  emphasized                                                                    
that the $5.5  billion was the total taxes from  the oil and                                                                    
the  gas both,  compared to  the $6.1  billion that  was oil                                                                    
2:59:11 PM                                                                                                                    
Representative  Kelly queried  writing regulations  [adopted                                                                    
by  DOR  during  AGIA]  related to  changing  the  point  of                                                                    
production  and the  BTU oil  equivalent. Mr.  Marks replied                                                                    
that he would get to the issue.                                                                                                 
Representative  Doogan  asked  the   value  of  gas  in  the                                                                    
example. Mr. Marks replied that the  value of gas on a MMBTU                                                                    
basis would  be about $1.60  and on a  BTU basis $9  to $10.                                                                    
The dilution  effect drags  the oil taxes  down and  the gas                                                                    
taxes  up,  but  the  net  effect is  that  the  oil  effect                                                                    
overwhelms  the  gas  effect,  which  creates  the  drop  in                                                                    
revenue when oil and gas are both being produced.                                                                               
Vice-Chair  Thomas asked  what would  motivate a  person who                                                                    
voted  against  ACES  to  vote  for  decoupling.  Mr.  Marks                                                                    
replied that  the issue was a  policy call. He stated  as an                                                                    
analyst that whether a person liked  ACES or not, it was the                                                                    
law of the land. He stressed  that ACES would stay in effect                                                                    
just as it was passed except  that it would apply to oil and                                                                    
gas distinctly.                                                                                                                 
Co-Chair Hawker agreed that the  question was on his mind as                                                                    
well. He reiterated  that the crafters of PPT  knew that the                                                                    
dilution problem  would have to  be dealt with.  He believed                                                                    
the issue  was a long-term  consistency one and that  SB 305                                                                    
would "buy an insurance policy, just in case."                                                                                  
3:04:39 PM                                                                                                                    
Representative Austerman  asked for clarification  about the                                                                    
numbers arrived  at. Mr. Marks replied  that the assumptions                                                                    
start with $86/bbl oil and the gas  at $9 on a BOE basis and                                                                    
ends up with  and average of $47 for per  unit value oil and                                                                    
gas combined.                                                                                                                   
Representative Austerman  queried the  value of the  $8 when                                                                    
oil  and gas  are  combined. Mr.  Marks  responded that  the                                                                    
value was about $1.60.                                                                                                          
Representative  Gara  went  back to  Representative  Kelly's                                                                    
question. He  summarized that (related  to valuing  the gas)                                                                    
the Senate  had passed a version  on a BTU basis;  the House                                                                    
Resources Committee worked with  the administration and came                                                                    
up with  a point-of-production basis for  the value. Whether                                                                    
there is a  BTU basis that results  in a lower gas  tax or a                                                                    
point-of-production  basis that  is higher,  the goal  is to                                                                    
not start the open season with a  gas tax that is too low as                                                                    
it might  only go  lower with  negotiations. He  queried the                                                                    
regulations passed with a definition  of gas taxes. He asked                                                                    
whether the  DOR regulations would  be overridden if  SB 305                                                                    
were passed.                                                                                                                    
Mr. Marks  clarified that there  were two  different issues.                                                                    
With  decoupling, there  would  be the  issue of  allocating                                                                    
costs between  oil and gas.  The regulations adopted  by DOR                                                                    
several weeks ago stipulate that  under AGIA the gas part of                                                                    
the tax  is locked in. Since  under the status quo  there is                                                                    
one total  tax that does not  separate gas tax and  oil tax,                                                                    
the department  needs to come up  with a way to  ascribe how                                                                    
much of  the $5.5  billion is gas.  Tax is  being allocated,                                                                    
not  costs, using  gross value.  He  agreed that  if SB  305                                                                    
passed,  the  adopted  regulations  would  not  make  sense.                                                                    
Decoupling would make clear how much the gas taxes are.                                                                         
3:09:12 PM                                                                                                                    
Representative Gara  wanted assurance  that Mr.  Marks would                                                                    
work  with  the  administration  if SB  305  says  that  the                                                                    
regulations are  no longer necessary. Mr.  Marks thought the                                                                    
question was for the administration.                                                                                            
Representative Fairclough summarized  her understanding: the                                                                    
oil tax  at $6.1  billion is an  equivalent when  taken into                                                                    
barrels; when  the 4.5 Bcf/day  gas is added, which  will be                                                                    
taxed at  the combined  rate, the  new combined  rate equals                                                                    
the  $47 per  barrel (taxed  at 32  percent). She  asked the                                                                    
values of  the oil and the  gas. Mr. Marks replied  that the                                                                    
value of oil has not changed.                                                                                                   
Representative Fairclough queried the  difference in the tax                                                                    
rate. Mr. Marks replied that the  tax rate on the $86 oil is                                                                    
47 percent.                                                                                                                     
Representative  Fairclough  asked   for  clarification.  Mr.                                                                    
Marks  explained that  the tax  went from  47 percent  to 32                                                                    
percent  because  of  progressivity. Even  though  there  is                                                                    
higher value for  the oil, dropping the tax  rate 15 percent                                                                    
on the total value accounts for the $1.6 billion less.                                                                          
Mr. Logsdon  added that the  weight average should  come out                                                                    
to $47/bbl if  the volume in barrels were  multiplied by the                                                                    
barrel  price  for  oil  and  the volume  of  the  gas  were                                                                    
multiplied by  the barrel equivalent  price of the  gas. Mr.                                                                    
Marks elaborated that if the 4.5  Bcf/day on a BOE basis was                                                                    
divided by  6, the  result would be  about 750,000  BOEs per                                                                    
day;  750,000 BOEs  of gas  and 500,000  BOEs of  oil, or  a                                                                    
production ratio of 60 percent gas and 40 percent oil.                                                                          
Mr. Marks continued  that the other side  is relative value.                                                                    
He compared  $86/bbl oil;  at a BOE  equivalent, the  gas is                                                                    
about $9 ($1.66/MMBTU). He stressed  that to put oil and gas                                                                    
on  an  equivalent basis,  the  $8  gas with  transportation                                                                    
costs subtracted is worth about $1.66/MMBTU.                                                                                    
3:14:47 PM                                                                                                                    
Mr. Marks turned  to Slide 8, "What  Happens with Decoupling                                                                    
[Using relative gross value to allocate cost]":                                                                                 
   • $120 oil and $8 gas                                                                                                        
        - Status quo taxes    = $5.5 billion                                                                                    
        - De-coupled taxes    = $7.9 billion                                                                                    
     $2.4 billion difference                                                                                                
   • Annual difference at other prices:                                                                                         
        - $100 oil / $8 gas: $1.4 billion                                                                                   
        - $80 oil / $8 gas:   $0.8 billion                                                                                  
Mr. Marks  detailed that the  difference between  the status                                                                    
quo  and  decoupling  would be  around  $2.4  billion.  When                                                                    
decoupling, the costs  need to be allocated  between oil and                                                                    
gas.  He  referred  to  a  recent  amendment  by  the  House                                                                    
Resources Committee to allocate  based on the relative gross                                                                    
value of oil  and gas (the gross value is  market price less                                                                    
transportation).  Using  the  gross  value,  the  difference                                                                    
would   be  $2.4   billion  between   the  status   quo  and                                                                    
decoupling. He noted that the  bigger difference between oil                                                                    
and gas value, the bigger  the difference between the status                                                                    
quo  and decoupling.  He covered  the  annual difference  at                                                                    
other prices for oil.                                                                                                           
Co-Chair  Hawker queried  the  break-even  point. Mr.  Marks                                                                    
replied progressivity is not  linear. Co-Chair Hawker stated                                                                    
that the closer oil and gas  come in price, there is less of                                                                    
a problem.  Mr. Marks  thought the question  was how  SB 305                                                                    
would decouple oil from gas.                                                                                                    
Co-Chair Hawker contended that SB  305 is hard to understand                                                                    
and must  be taken  in context with  the entire  statute; he                                                                    
believed  the  presentation   defined  the  simpler  concept                                                                    
embodied in the bill.                                                                                                           
Representative  Austerman   asked  whether   the  PowerPoint                                                                    
information was based on the  amended bill coming out of the                                                                    
House  Resource Committee  or the  Senate version.  Co-Chair                                                                    
Hawker answered that the two  versions were the same for the                                                                    
purposes of  the current conversation; the  major difference                                                                    
in the  House Resources  Committee version is  an additional                                                                    
mechanism  that would  make the  tax take  effect for  about                                                                    
three days, go  away, and then take effect ten  years in the                                                                    
future. The mechanism remained unchanged.                                                                                       
3:18:10 PM                                                                                                                    
Mr. Marks asserted that SB  305 was changing one small thing                                                                    
in  how the  production tax  works, which  would make  a big                                                                    
difference. He  directed attention to  Slide 9, "How  SB 305                                                                    
Works," highlighting  the difference in  calculation between                                                                    
the current tax regime and decoupling:                                                                                          
   • Currently                                                                                                                  
        - Each    company     calculates    one    statewide                                                                
          progressivity rate based on all combined oil and                                                                      
          gas activity (oil, Cook Inlet gas, other in-state                                                                     
   • Under SB 305: Two Progressivity Calculations                                                                           
        - Bucket 1: Same current activity (oil, CI gas,                                                                     
          other in-state gas) will continue to be                                                                               
          calculated together                                                                                                   
             • No tax increase on current activity                                                                              
        - Bucket 2: Progressivity on export gas will be                                                                     
          calculated distinctly (same formula)                                                                                  
            • Will not dilute oil progressivity                                                                                 
Mr.   Marks   detailed   that   currently   there   is   one                                                                    
progressivity  rate  based  on  all  combined  oil  and  gas                                                                    
activity.  Progressivity under  SB 305,  by contrast,  would                                                                    
use two calculations, first  separating current activity and                                                                    
export gas  into two "buckets."  Bucket 1 would  contain all                                                                    
current activity; there would be no tax increase.                                                                               
Co-Chair  Hawker stated  that there  would be  no change  in                                                                    
activity and no change in taxes.                                                                                                
Mr.  Marks continued  that without  SB 305,  there would  be                                                                    
only  one  statewide  bucket  and  when  a  major  gas  deal                                                                    
happens,  the gas  exported would  dilute the  value of  the                                                                    
oil. Senate  Bill 305 would set  up a new bucket  (Bucket 2)                                                                    
containing  only  the  export gas;  progressivity  would  be                                                                    
calculated on  the export  gas exactly  as it  is calculated                                                                    
under ACES.  He underlined  that calculating the  export gas                                                                    
separately would  prevent the export  gas from  diluting the                                                                    
oil activity.                                                                                                                   
Co-Chair   Hawker   summarized   that  the   oil   activity,                                                                    
calculated  as it  is currently  would remain  in Bucket  1,                                                                    
while  the new  export  gas  would be  in  Bucket  2 with  a                                                                    
separate calculation.                                                                                                           
3:20:54 PM                                                                                                                    
Representative Gara  asked whether gas that  is not exported                                                                    
but used  in the state  would remain under the  current ACES                                                                    
tax. Mr. Marks responded in the affirmative.                                                                                    
Co-Chair  Hawker  noted  that  Cook  Inlet  gas  would  stay                                                                    
permanently  under ELF.  Mr. Marks  added that  it would  be                                                                    
calculated under progressivity but would pay under ELF.                                                                         
Representative   Austerman  asked   how  "export   gas"  was                                                                    
defined.  Mr. Marks  replied  that export  gas  is gas  that                                                                    
leaves the  state and  is used outside  the state,  with the                                                                    
exception of Cook Inlet gas.                                                                                                    
Co-Chair Hawker clarified that the  gas referred to would be                                                                    
from  the North  Slope.  Mr. Marks  agreed  that the  liquid                                                                    
natural  gas (LNG)  is part  of Bucket  1; export  gas would                                                                    
come from  outside of Cook  Inlet and leave the  state, such                                                                    
as North  Slope gas that  would go  to Canada and  the Lower                                                                    
Representative Gara  pointed out that  there could not  be a                                                                    
separate, lower tax  on gas used in-state.  He asked whether                                                                    
the Bucket 2 language  could stipulate that decoupling would                                                                    
begin  when North  Slope gas  began to  be exported.  He was                                                                    
concerned  with constitutional  issues. Mr.  Marks responded                                                                    
that Bucket 2 would be empty  until a major gas sale is made                                                                    
and that the in-state gas would be Bucket 1.                                                                                    
3:24:16 PM                                                                                                                    
Mr.  Marks  pointed   to  Slides  10  and   11  with  visual                                                                    
illustrations of the two buckets.                                                                                               
Representative Fairclough asked whether  Bucket 1 would have                                                                    
the  combined tax  rate and  Bucket 2  would not.  Mr. Marks                                                                    
answered  in   the  affirmative;   the  combined   tax  rate                                                                    
currently in effect would be in Bucket 1.                                                                                       
Co-Chair Hawker  added that pure decoupling,  or putting all                                                                    
gas in  one bucket  and all oil  in another,  would penalize                                                                    
the  companies that  are currently  producing  both oil  and                                                                    
Mr. Marks reported that the  bucket system was structured in                                                                    
the Senate Finance Committee; the  intent was that there not                                                                    
be a tax increase at this time.                                                                                                 
Vice-Chair Thomas queried the tax  rate for spur lines taken                                                                    
off  the main  gasline. He  wondered what  the royalty  rate                                                                    
would be  to the  in-state users.  Mr. Marks  responded that                                                                    
under the  current production  tax, all  in-state gas  has a                                                                    
tax rate  that is subject to  old ELF provisions, a  low tax                                                                    
of $0.17/MMBTU regardless of the price.                                                                                         
Vice-Chair  Thomas clarified  that the  rate applied  to any                                                                    
gas used in the state.                                                                                                          
Co-Chair  Hawker  acknowledged  that current  statute  could                                                                    
face  federal constitutional  challenges,  as different  tax                                                                    
structures  are  set  up  for in-state  gas  from  the  same                                                                    
source.  He stated  that the  possibility  would not  become                                                                    
real until the  state has actually exported  gas. He thought                                                                    
the  issue did  not have  to be  dealt with  in the  current                                                                    
legislative session.                                                                                                            
3:28:28 PM                                                                                                                    
Representative Gara  wanted the bill  written in a  way that                                                                    
is constitutional. He fully intended  to leave the lower tax                                                                    
rate on in-state use of gas as long as possible.                                                                                
Representative Gara  summarized that by mixing  oil and gas,                                                                    
the state  essentially short-changes  itself on the  oil tax                                                                    
rate  in cases  where  there is  low-priced  gas. Mr.  Marks                                                                    
Representative Gara stated for the  record that the state is                                                                    
currently giving a benefit  to companies like ConocoPhillips                                                                    
by allowing them to dilute  oil tax payments with Cook Inlet                                                                    
gas costs. Mr. Marks agreed.                                                                                                    
Co-Chair  Hawker  took  issue   with  the  language  "short-                                                                    
changing" the state, which implied  a motive that he did not                                                                    
think existed.                                                                                                                  
Representative  Gara restated  that one  of the  benefits to                                                                    
producers who provide  in-state gas is a  slightly lower tax                                                                    
rate. Mr. Marks responded that PPT was designed as a state-                                                                     
wide  tax based  on state-wide  activity. Combining  oil and                                                                    
gas does reduce the tax.                                                                                                        
Co-Chair Hawker  explained that the  sponsor's bill  did not                                                                    
intend  to  fiscally  impact current  producers  relying  on                                                                    
current law.  The bill intended  to accommodate  the interim                                                                    
period  and not  disrupt producers  from developing  new gas                                                                    
sources.  He  noted  that   the  House  Resources  Committee                                                                    
addressed the  issue by  creating a  window that  would open                                                                    
and then close  through a trigger mechanism.  He referred to                                                                    
concerns about the mechanism and  hoped to find a better one                                                                    
allowing a durable statute that would provide the hold-                                                                         
harmless  for  existing  producers.  He  reported  that  his                                                                    
office  had been  working closely  with the  consultants and                                                                    
DOR;  both had  arrived  at  a similar  concept  on a  joint                                                                    
proposal that would address the issue.                                                                                          
3:33:58 PM                                                                                                                    
Representative Kelly  asked whether  the major  players from                                                                    
the industry  would be present for  the discussion. Co-Chair                                                                    
Hawker anticipated that they could  join in public testimony                                                                    
voluntarily   or   they   could   be   required   to   join.                                                                    
Representative  Kelly wanted  a  complete  record and  hoped                                                                    
they would be required to participate.                                                                                          
Representative Austerman  asked for  clarification regarding                                                                    
LNG. Mr.  Marks explained that  the portion of the  gas that                                                                    
stayed in-state would be Bucket  1; North Slope gas that was                                                                    
exported through  an in-state line through  Southcentral and                                                                    
Valdez would be Bucket 2.                                                                                                       
Co-Chair Stoltze  stated that he  did not want  producers to                                                                    
be compelled to testify.                                                                                                        
3:37:17 PM                                                                                                                    
Representative Kelly  maintained that it would  be a mistake                                                                    
to  leave out  information  from the  group  because of  the                                                                    
short time allowed.                                                                                                             
Representative  Fairclough  agreed  with  comments  on  both                                                                    
sides  of the  issue  and  suggested that  a  time could  be                                                                    
specified for testimony from the players.                                                                                       
Co-Chair Hawker spoke to the timeline for the amendment.                                                                        
SB  305  was  HEARD  and   HELD  in  Committee  for  further                                                                    
3:40:22 PM               AT EASE                                                                                              
4:03:00 PM               RECONVENED                                                                                           

Document Name Date/Time Subjects
HB 69 CS WORKDRAFT 26 LS0281 W.pdf HFIN 4/14/2010 8:30:00 AM
HB 69
HB 317 CS WORKDRAFT 26-1378 P.pdf HFIN 4/14/2010 8:30:00 AM
HB 317
2009 SB 144 sponsor stmt & sectional.doc HFIN 4/14/2010 8:30:00 AM
SB 144
2009 SB 144 Musk Ox poster.pdf HFIN 4/14/2010 8:30:00 AM
SB 144
SB230 SpreadSheet.pdf HFIN 4/14/2010 8:30:00 AM
SB 230
00 Sponsor Statement CSSB219.pdf HFIN 4/14/2010 8:30:00 AM
SB 219
05 Sectional Analysis.pdf HFIN 4/14/2010 8:30:00 AM
SB 219
06 Alaska Data Graphs.pdf HFIN 4/14/2010 8:30:00 AM
SB 219
07 TBI Scorecard and Dashboard 032009.pdf HFIN 4/14/2010 8:30:00 AM
SB 219
08 Medicaid BrainInjury Program Costs.pdf HFIN 4/14/2010 8:30:00 AM
SB 219
09 StateofAlaska_Services_Congenital_Degenerative_BrainInjury.pdf HFIN 4/14/2010 8:30:00 AM
SB 219
10 Acquired Brain Injury Definition.pdf HFIN 4/14/2010 8:30:00 AM
SB 219
SB305 sponsor statement.docx HFIN 4/14/2010 8:30:00 AM
SB 305
11 Letters of Support.pdf HFIN 4/14/2010 8:30:00 AM
SB 219
HCS CSSB305(RES)(title am)-REV-TAX-04-13-10 decoupling.pdf HFIN 4/14/2010 8:30:00 AM
SB 305
2010 03 02 D Wood Calculations FY2008_09.pdf HFIN 4/14/2010 8:30:00 AM
SB 305
HB 317 Amendment #2 Gara.pdf HFIN 4/14/2010 8:30:00 AM
HB 317
SB 235 - Sponsor Statement.PDF HFIN 4/14/2010 8:30:00 AM
SB 235
SB 235 - Sectional Analysis.PDF HFIN 4/14/2010 8:30:00 AM
SB 235
HB338_SB269 Supporting Documents - AIDEA (2) (2)[1].pdf HFIN 4/14/2010 8:30:00 AM
HB 338
SB 269
SB269 Supporting Documents Letter FNSB EDC Resolution.pdf HFIN 4/14/2010 8:30:00 AM
SB 269
Sponsor Statement HB 69(EDC).pdf HFIN 4/14/2010 8:30:00 AM
HB 69
SB235 CS WORKDRAFT 26-LS1256 E VERSION.pdf HFIN 4/14/2010 8:30:00 AM
SB 235
Sectional HB 69(EDC).pdf HFIN 4/14/2010 8:30:00 AM
HB 69
Changes from HB 69 to HB 69(EDC).pdf HFIN 4/14/2010 8:30:00 AM
HB 69
HB069-EED-TLS-3-23-10.pdf HFIN 4/14/2010 8:30:00 AM
HB 69
Sectional HB 69(EDC).pdf HFIN 4/14/2010 8:30:00 AM
HB 69
Sectional CS HB 69 Version W.pdf HFIN 4/14/2010 8:30:00 AM
HB 69
HB 69(EDC) Fiscal Note Summary.pdf HFIN 4/14/2010 8:30:00 AM
HB 69
HB 69 Support Letters.pdf HFIN 4/14/2010 8:30:00 AM
HB 69
HB 69(EDC) FIN Background.pdf HFIN 4/14/2010 8:30:00 AM
HB 69
HB 317 Conceptual Amendment Stoltze Hawker.pdf HFIN 4/14/2010 8:30:00 AM
HB 317
Logsdon&Associates SB305 HsFin 041410.pptx HFIN 4/14/2010 8:30:00 AM
SB 305
CSHB069(FIN)-EED-TLS-4-14-2010.pdf HFIN 4/14/2010 8:30:00 AM
HB 69
HB421-LEG-LEG-4-14-10.pdf HFIN 4/14/2010 8:30:00 AM
HB 421
SB 220 Amendment #5 Gara.pdf HFIN 4/14/2010 8:30:00 AM
SB 220