Beyond Prudhoe Bay.

• Author: Barry, Doug
• Position: Alaska's international trade - Access the World

We're in the first few years of "PPB," a turning point in time known as "Post Prudhoe Bay." Alaska will have a new governor come January. Another possible turning point. What trends in Alaska's international trade can he expect during the next four years?

OIL AND GAS CRYSTAL BALL

Look for Congress to find a way to lift the ban on North Slope oil by the middle of 1995. The most likely purchasers of this oil, the Japanese, already have long-term contracts with suppliers, but Japan's energy policy deliberately encourages purchases from lots of different suppliers. Also, purchases of Alaska crude will reduce Japan's embarrassingly high trade surplus with the United States.

The Japanese will make additional commitments to purchase Alaska natural gas, paving the way for construction of a pipeline and liquid natural gas plant. Coupled with similar commitments from Taiwan and Korea, the huge project will finally get the green light.

China may also become a big net energy importer, especially of refined products, as it struggles to tap its own coal, oil and gas deposits. That country now serves as a big market for oilfield equipment and services. Demand for these products is expected to grow by 20 percent per year.

RUSSIA REVISITED

The prediction of a green light for a gas pipeline here might fizzle if Asian growth stumbles, and if the oil and gas fields off the coast of Sakhalin Island in Russia's Far East can produce what the market needs. In either case, Alaska will pick up business from the enormous construction projects that will go forward there.

Some Alaska companies have already done work on Sakhalin, mostly as subcontractors to larger U.S.-owned firms. Because Russian law will probably require foreign companies to have a local Russian partner, interested Alaska companies, particularly in the oil and oilfield support services, communications, catering and transportation, should start hunting now for suitable Russian partners.

The new governor might consider pushing for a full-time trade office in Sakhalin (we have them now in Tokyo and...