Parnell's oil, gas plans get mixed response

State of the State address salutes ferry, icebreaker saves

Gov. Sean Parnell laid out an aggressive agenda on oil and gas issues in his State of the State address Wednesday evening.


But despite calls to work together on his agenda, the response was decidedly partisan.

There was loud applause when he commended the crew of the ferry Malaspina for its initiative in rescuing a battered and bleeding hiker near Haines and transporting him to safety.

“On behalf of a grateful state, we thank you,” he said.

But the applause was sketchier when Parnell said “We must act now” to reduce oil taxes.

If the state fails to offer better incentives to the oil producers, they’ll invest in places other than Alaska, he said.

If our policy is to “grab all the tax dollars we can,” the companies would send their investment dollars elsewhere in the global economy, he said.

“Alaska’s oil production decline will become Alaska’s decline,” he said.

Parnell got a broader response when he outlined a bold stand on pushing for natural gas development, saying by early this year he expects the oil companies that hold big natural gas reserves on the North Slope to “formally align” under the Alaska Gasline Inducement Act to build a large-diameter liquefied natural gas export line. He didn’t say how he’d compel companies that have resisted the state’s AGIA process to participate.

After the speech, other legislators questioned some of his strategies.

Rep. Beth Kerttula, a Juneau Democrat who leads the House Minority Caucus, questioned whether Parnell’s tax reductions would benefit the state or just the oil companies.

“We must get a fair return on our resources,” she said. “That fair return keeps Alaska among the wealthiest states,” she said, returning to one of the themes of Parnell’s address.

“Outside interests have had a long history of exploiting Alaska’s resources,” she said.

“Our state was founded to make sure Alaskans did get their fair share,” Kerttula said.

She outlined some goals of House Democrats, including increasing education funding and asking questions about Alaskan hire on the North Slope.

Parnell spoke of a number of his education initiatives, including some dramatic education improvements he said were caused by the Alaska Performance Scholarship program he advocated.

In addition, Parnell said his administration had built and renovated two rural schools, and would build five more to settle a long-running lawsuit over education funding fairness.

Members of the Senate Bipartisan Working Group, the coalition that elected Sen. Gary Stevens, R-Kodiak, Senate president, said its education goals would be different than Parnell’s.

There will likely be an effort in the Senate to increase the Base Student Allocation, the per-student amount that goes to school districts.

For the first time in several years, the 2011 Legislature did not increase it for this year, and Parnell’s budget proposes no increase next year either.

There was broad support for some other parts of Parnell’s agenda, including his “Choose Respect” initiative.

Parnell said members of coach John Blasco’s Thunder Mountain Falcons boys basketball team would be wearing “Choose Respect” T-shirts today as they warm up for their game against the Chugiak Mustangs.

It’s a message they sent before a game last year as well, he said, and thanked the team for its support.

“Thank you Falcons, for sending a powerful message on and off the court,” he said.

Parnell’s speech was also peppered with salutes to the state’s military, law enforcement, firefighters and other first responders.

And everyone came together for a thank you to the U.S. Coast Guard for the assistance the icebreaker Healy provided to Nome.

The back-story, he said before the standing ovation for the crew, was they’d been away from home for seven months when they were diverted back to Nome for several more weeks to assist that community.

• Contact reporter Pat Forgey at 523-2250 or at


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