Hoping to reverse two decades of declining oil production in Alaska, the State Legislature in Juneau has granted oil companies an estimated $750 million in annual tax relief to increase investment in the giant North Slope oil field.
The tax change, approved on Sunday, was a major victory for Exxon Mobil, ConocoPhillips and BP, which had lobbied for years to repeal a tax system put in place by former Gov. Sarah Palin in 2007 that made state oil taxes among the highest in the nation. The companies have long claimed that high operating costs and taxes in Alaska encouraged them to move their investment dollars to other states with lower tax rates, like Texas and North Dakota, where oil and gas exploration and production have been booming in new shale fields.From Living Trading News via The Oil Drum:
While advocates of solar, wind and other “Green” energy some are saying that renewable energy is the future, technological advances in the Oil and Gas industries will lead to abundant supplies well into the future, I have been saying for years that Peak Oil is a myth, it is.
US Crude Oil production rose by an average of 790,000 bpd in Y 2012, the largest annual increase in American oil production since it began in Y 1859.
This year the Energy Information Administration EIA expects production to rise by 815,000 bpd, setting another record.
What led to these dramatic production increases is innovative drilling technology.From Forbes via The Oil Drum:
“he convergence of a myriad of technologies, ranging from better drill bits and seismic data to robotic rigs and high-performance pumps is allowing the Oil and Gas sector to produce staggering quantities of energy from locations that were once thought to be inaccessible or bereft of hydrocarbons.
If you want to see what the natural gas revolution in America has wrought, there’s no better place than the Sabine Pass liquefied natural gas port in coastal Louisiana. There you can peer into five massive storage tanks, each almost big enough to contain Madison Square Garden. Taken together, they can hold the liquefied equivalent of 17 billion cubic feet of natural gas–a quarter of what the United States uses in a day.
Built in 2008 by Houston-based Cheniere Energy when it appeared certain that the U.S. would soon run short on natural gas and need imports to make ends meet, they ran headlong into the Great American Gas Boom. Drillers in recent years have unlocked so much gas from tight rock that America now enjoys record gas supplies and prices that are just one-quarter of what buyers in Europe and Asia pay. Projections are that the annual U.S. gas supply could grow a further 25% by 2035.