Oil and Gas in the 49th State: Hope on the Horizon.

• Author: Mackenzie, Kathryn
• Position: FROM THE EDITOR - Editorial

Alaska was purchased by the United States more than 150 years ago, due in part-even then-to an understanding of the state's significant potential. When Alaska was under consideration for statehood, one of the arguments to welcome what would become the 49th state was this land's almost unfathomable resources. The Trans Alaska Pipeline System, since its completion, has served as an economic artery for the state, with oil and gas building our industries and our communities. Historically in Alaska, as oil busts we hurt, and as it booms we prosper.

The oil and gas industry, through direct and indirect jobs, remains a key part of Alaska's economy. Policy, production, tax credits, and price weigh heavily on the minds of all involved in this vast and complicated industry. What's the next great discovery, or is there one? Even if there is, will it be economic for production? Alaska's most recent oil finds are still in development infancy with no guarantee that they will translate into additional oil in the pipeline. While state government wrings its hands and worries over budget, what investments are on the horizon to ensure oil and gas companies continue to explore and invest?

Despite questions and uncertainty, it's important to take note of the orogress Alaska is making toward continued and increased production coursing through TAPS and the cautious optimism and forward-looking attitude of the industry as a whole.

With gas prices inching above $60 per barrel, there is hope on the horizon.

"Higher oil prices offer a bit of relief for Alaskans worried about the state's finances," said Kara Moriarty, AOGA president and CEO, in a March statement. "Of course, a serious budget gap remains, but we are calling attention to the 100,000 additional barrels of oil moving down the pipeline than was forecast under the last oil tax law, called ACES. In the FY12 and FY13 production forecasts, analysts predicted oil production would plummet a full 100,000 barrels below today's projected number. It is not difficult to figure out why state experts became optimistic about future oil production...