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What have the Republicans-or even the Democrats in Congress-to do with the Alaska's economy? Congress does not dictate the price of oil, does it?
But Congress and the State Legislatures pass laws that affect what States are capable of doing. And even legislatures in other places as well as some politicians who are called dictators call the shots and make things obscene. See the likes of the European Union where they have negative interest rates and you are paying the government to loan them money. And of course you also have the likes of Putin who gives his friends giant chunks of the government so they can be billionaires. The Fed will sometime in the near future raise interest rates which will keep us from having negative rates and that is a creation of our congress. At some point you were fussing about the planned copper mine that needs to dig up dozens of Salmon streams so we can create some new billionaires here in Alaska. And think about who said ANWAR was off limits for those who are already billionaires. More than half the States now have republican dominated legislatures and they are creating laws of all kinds. Right to work laws are doing things never dreamed of a few years ago. Those people who no longer have jobs don't have a lot of money to spend. So do you think they will be visiting Alaska on their non existent vacations? I recently heard more than half the States are considering raising taxes on the gasoline you buy at the pump. Do you understand what those taxes that maintain the roads that you are paying when you buy gas do for the economy? There are people getting paid to work on roads all over the country. I don't recall toll roads in Alaska but they are getting common elsewhere. Regardless who sets the price of oil supply and demand for refined oil are still part of the equation and with a single refinery Alaska has little to offer the supply. If I heard correctly that refinery was built to make jet fuel wasn't it?
If there aren't sufficient revenues to pay pensions and other forms of retirement pay what will happen to us? So higher taxes are on the way and who can raise taxes? Believe it or not what happens elsewhere does affect Alaska's economy and it doesn't look pretty from the statehouse door.
But Congress and the State Legislatures pass laws that affect what States are capable of doing. And even legislatures in other places as well as some politicians who are called dictators call the shots and make things obscene. See the likes of the European Union where they have negative interest rates and you are paying the government to loan them money. And of course you also have the likes of Putin who gives his friends giant chunks of the government so they can be billionaires. The Fed will sometime in the near future raise interest rates which will keep us from having negative rates and that is a creation of our congress. At some point you were fussing about the planned copper mine that needs to dig up dozens of Salmon streams so we can create some new billionaires here in Alaska. And think about who said ANWAR was off limits for those who are already billionaires. More than half the States now have republican dominated legislatures and they are creating laws of all kinds. Right to work laws are doing things never dreamed of a few years ago. Those people who no longer have jobs don't have a lot of money to spend. So do you think they will be visiting Alaska on their non existent vacations? I recently heard more than half the States are considering raising taxes on the gasoline you buy at the pump. Do you understand what those taxes that maintain the roads that you are paying when you buy gas do for the economy? There are people getting paid to work on roads all over the country. I don't recall toll roads in Alaska but they are getting common elsewhere. Regardless who sets the price of oil supply and demand for refined oil are still part of the equation and with a single refinery Alaska has little to offer the supply. If I heard correctly that refinery was built to make jet fuel wasn't it?
If there aren't sufficient revenues to pay pensions and other forms of retirement pay what will happen to us? So higher taxes are on the way and who can raise taxes? Believe it or not what happens elsewhere does affect Alaska's economy and it doesn't look pretty from the statehouse door.
If you take the politics out of it, then it makes sense. This thread is about the Alaska's economy as the price for oil has dropped, and this is nothing new since our economy relies on oil. The last "bust" happened in the '80s.
Regardless who sets the price of oil supply and demand for refined oil are still part of the equation and with a single refinery Alaska has little to offer the supply. If I heard correctly that refinery was built to make jet fuel wasn't it?
Mother nature, not politics, is why there are few refineries in Alaska. Freezing temperatures cause refineries to shut down. You need heat to refine oil. That's why most refineries are in Texas and Louisiana.
Cold weather usually pays havoc with the water and steam systems, said an engineer who spoke on condition of anonymity because of company policy. If crude is not kept hot, particularly heavy grades, it will get stuck in pipes, he explained.
Refineries are indeed complex to work with. In some small countries there are three cuts made from crude oil: gasoline, diesel and asphalt. In some refineries there are so many cuts of different fluids that range from the above three to things like Vaseline, paraffin, different exotic items that are used in special conditions, and with the use of catalysts they convert some items to more desired things like gasoline, jet fuel and diesel which is also used as heating oil in some places, and whatever else is desired. However cold alone isn't going to stop refining being pipes and cat crackers can be hidden from the atmospheric cold by thick insulation and they have critical parts in specially heated buildings. But those extras cost money and usually when possible refineries are operated in in areas where there are milder temps.
From what I remember about Alaska's refinery it was designed to make jet fuel as the primary cut and part of the by products were used to heat the critical parts. I recall something about the military took a major part of the output and the rest was used for commercial aviation at the larger airports. So I doubt as long as any crude was available the military and commercial operations took what ever they needed at an appropriate price which would mean all the output was sold for whatever it cost to make it regardless of what the price was and it had little effect on the economy since with the government being involved it is doubtful the State took any tax money from that oil.
There is an economy to scale with refineries as I understand it. And Alaska doesn't use enough gas, diesel, heating fuel, or jet fuel for a large refinery to be here in one area. Remember that if we cut Alaska in HALF, Texas would be the third largest state. For whatever reason it is not economical to refine it here. Admittingly, I don't fully understand it though. A friend of mine that works in a Texas refinery actually told me that a lot of the side products they lose money on, but better than throwing it out and they are created when they go to make products that are sold for profit. They have multiple units that do multiple "cuts".
It is also amazing how many different agencies have their hands on regulations here. "They" can't even agree to build natural gas pipelines so that people can heat with cheaper and CLEANER fuel in more places around the state. Places like Fairbanks that could benefit from that source as wood smoke is a health hazard with the temp inversion. Even when it looks like a line will go through everyone wants a piece of it. I don't blame them, but it never seems to even let one line get through.
I have a lot to learn about this state - granted it isn't like the state I cam from had their act together any better. It was just different.
There is an economy to scale with refineries as I understand it. And Alaska doesn't use enough gas, diesel, heating fuel, or jet fuel for a large refinery to be here in one area. Remember that if we cut Alaska in HALF, Texas would be the third largest state. For whatever reason it is not economical to refine it here. Admittingly, I don't fully understand it though. A friend of mine that works in a Texas refinery actually told me that a lot of the side products they lose money on, but better than throwing it out and they are created when they go to make products that are sold for profit. They have multiple units that do multiple "cuts".
It is also amazing how many different agencies have their hands on regulations here. "They" can't even agree to build natural gas pipelines so that people can heat with cheaper and CLEANER fuel in more places around the state. Places like Fairbanks that could benefit from that source as wood smoke is a health hazard with the temp inversion. Even when it looks like a line will go through everyone wants a piece of it. I don't blame them, but it never seems to even let one line get through.
I have a lot to learn about this state - granted it isn't like the state I cam from had their act together any better. It was just different.
A number of years ago I worked as an inspector on the Natural gas pipeline that runs past Orlando and then to Miami. That one was brought down from the Tallahassee area and followed the then new Sunshine Parkway across the State which meant there was no problem with getting an easement to run the pipeline across the State even though Miami didn't truly need the gas for heating homes back then. At this time I think there are a couple of electric utility plants from Orlando to near the Miami area which use natural gas from that pipeline to produce electricity. Otherwise there are few commercial interests that use natural gas downstate.
The problem in Alaska is there are a lack of right of way easements across the many National Parks, the native owned lands and the numerous private holdings which will shove the cost into the stratosphere because there are no commercial interests that need abundant natural gas to make such as investment worthwhile. When I was asked to work on the oil pipeline I heard there was so much oil that the pipeline would be economically viable the even though it went through mountains which make things very costly. In Florida digging in the sand was easy and there were no slopes to run up the cost. I was able to argue I couldn't work on the steep slopes so they dropped wanting me to be in charge of the inspections on the pipeline. Pipelines are rather easy to construct as long as you can weld it together and then drop it in an easy to dig hole. But crossing mountains and rivers is a costly way to move something as light as gas.
Natural gas is considered a problem product coming from an oil well. Much of it in the past has been flared off because storing and shipping it wasn't worthwhile. Many of the higher octane by products from refineries aren't profitable so cat crackers are used to convert these products to something worthwhile.
Some commercial areas use Nat Gas in Miami and it is all over. I asked the gas company to run it to my house down there. But I couldn't get enough neighbors to say they wanted it for them to do it. It was only about 100 yards away from my house too.
What has gotten peoples attention for natural gas in South Florida is that when the power goes out, you still have natural gas, just like for the most part you have county water. So hooking up a whole house generator to the natural gas line means not needing to get fuel for your generator and it can be hooked up to automatically turn on. Heating water with natural gas means your generator can be smaller and you can also cook with it. No more running out of propane for the grill either.
Ohh and FPL decommissioned a coal plant in favor of using natural gas in South Florida. For me that is good thing that the old, dirty, coal power plant is gone. Although more natural gas plants may have to be built if they can't figure out the cooling canal problems at Turkey Point...
And I agree that I see your problems with right of way in Alaska. Too many "people" own large chunks of land in the way...
Dak, not sure if this interests you or not but FP&L, which is now NextEra, is the largest owner/operator of wind turbines and the #1 source of renewable energy in the US. They were our biggest customer when I worked for Enron, GE and Siemens, and they are still the largest owner/operator so far as I know. They were our toughest customer, but they were my favorite. They did not monkey around.
I does interest me as a long time FPL customer. Thanks for sharing.
Also, since the Iran deal looks like it will go through we may see oil in the $30 a barrel range.
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