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Exclusive Interview: Palin Talks Pain at the Pump Ahead of Fox News Special
Breitbart's Big Government ^ | April 13, 2012 | Breitbart News

Posted on 04/13/2012 5:42:56 AM PDT by Timber Rattler

In an exclusive interview to Breitbart News, Sarah Palin discussed energy policy and her Fox News Special (with Eric Bolling) "Paying at the Pump," which airs tonight on FNC at 10pm ET. The program will re-air on Saturday and Sunday. She also touched on some other topics of the day...

(Excerpt) Read more at breitbart.com ...


TOPICS: Business/Economy; Constitution/Conservatism; Government; Politics/Elections
KEYWORDS: energy; obama; palin; sarahpalin
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To: Al B.
Alaska remains the most profitable place in the world for ConocoPhillips to be in the oil business -- 24.1% of their worldwide profits

I would like to understand that claim better.

Net Income in Alaska (E&P) was $1,735,000,000
Net World E&P Income was $9,198,000,000
Net Total Income was $11,417,000,000

Looks more like 15% of profit.

http://www.conocophillips.com/EN/investor/financial_reports/earnings_reports/Documents/4Q11_Supplemental.pdf

21 posted on 04/13/2012 10:28:33 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney
Nope, I haven't read the fine print in the 10-K's (if any) to know where royalty payments are applied. The tax line simply says "Taxes paid in Alaska". I'll try and dig into this later. Royalties may, in fact, be rolled into production costs which, in CP's case, were a TOTAL of $12.45/barrel in 2011 for AK oil.

Do you think royalties paid to Alaska make up the difference between 31.2% (from the 10-K's) and the 50% you claim? Please.

BTW, CP's profit/BOE in Alaska in 2011 was $24.15 vs. $8.16 in the Lower 48 vs. $17.86 overseas.

22 posted on 04/13/2012 10:43:28 AM PDT by Al B. ("Evil is powerless if the good are unafraid." -- Ronald Reagan)
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To: thackney
You're looking at the wrong year. You're quoting 2010, the worst year of the 4 ACES years for CP's Alaska E&P profitability. I was quoting from 2011 figures.

The 4-year average under ACES for CP is 22.9% of E&P profits on 15.6% of production. You'll have to do some spreadsheet math to get to the production figures. The raw daily production numbers come directly from CP's financials, though.

23 posted on 04/13/2012 11:05:56 AM PDT by Al B. ("Evil is powerless if the good are unafraid." -- Ronald Reagan)
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To: Al B.

Royalties are specifically excluded from SEC filings.

http://www.sec.gov/about/forms/industryguides.pdf

You are also using the price of oil sold in the L48. The value in Alaska is significantly lower according to the State Documents.

The state of Alaska shows $7.17 reduction per barrel. The average price paid by the L48 was $94.49, in Alaska that was $87.32. Alaska is not allowing them to deduct transpiration cost outside of Alaska; you cannot base the Alaska work on price paid after that expense.

http://www.tax.alaska.gov//programs/documentviewer/viewer.aspx?2524f

- - - - -

I would like to see support of your North Dakota comparison.

North Dakota Oil Gross Production Tax
http://www.nd.gov/tax/oilgas/
A 5% rate is applied to the gross value at the well of all oil produced, except royalty interest in oil produced from a state, federal or municipal holding and from an American Indian holding within the boundary of a reservation.

- - - - -

You also seem to ignore the that ConocoPhillips and others are investing for the future in places that give the best return on the dollar. You want to compare profit on existing facilities while ignoring where the jobs and investment are going.

https://www.conocophillipsalaska.com/ea/taxreform/assets/ConocoPhillips%20Tax%20Fact.pdf

When you only do maintenance on a facility while spending major dollars on upgrades and improvements elsewhere, it make look good today, but the production just continues to climb.

Wake up. There is an oil boom going on in the US while Alaska is watching it from the sidelines. I saw a list of projects ConocoPhillips is waiting to start, but for now the dollars mostly go to places like Alberta Oil Sands and Tight Sands/Shale.

ConocoPhillips’ capital investment in its Lower 48 operations increased from $1.8 billion in 2010 to $4.8 billion in 2012. Alaska’s capital budget has remained essentially flat at $900 million. Investment dollars go where companies make the best returns.

https://www.conocophillipsalaska.com/ea/taxreform/assets/ConocoPhillips%20Tax%20Fact.pdf


24 posted on 04/13/2012 11:15:09 AM PDT by thackney (life is fragile, handle with prayer)
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To: onedoug
can't stand a female with more smarts and knowledge than you..

let her talk..one day she will be PRESIDENT OF THE UNITED STATES OF AMERICA...if there is such a place after the Liberals and DemocRATS finish destroying a once great Nation...

she will have this families vote.

25 posted on 04/13/2012 11:23:07 AM PDT by haircutter
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To: Al B.
You're looking at the wrong year. You're quoting 2010, the worst year of the 4 ACES years for CP's Alaska E&P profitability. I was quoting from 2011 figures.

Dang it, thanks for the corrections.

Revised for 2011

Net Income in Alaska (E&P) was $1,983,000,000
Net World E&P Income was $8,242,000,000
Net Total Income was $12,436,000,000

Looks like almost 16%. It is 24% when you only count E&P.

Significant part of higher profit is the lack of new investment in Alaska. Sure it makes it look good this year in comparison; they are spending their dollars elsewhere. What do you think it holds for the Future of Alaska as the production continues to decline while the lower 48 is seeing a climb?

26 posted on 04/13/2012 11:29:01 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney
It is 24% when you only count E&P.

Correct. I said "E&P profitability". That's the way to look at it, considering the miniscule effect of other CP businesses in Alaska.

Significant part of higher profit is the lack of new investment in Alaska.

I actually agree with that. And getting to the real answers to the problem actually needs some adult conversation, not a bunch of "It's Palin's fault" BS. At least she tried to address it with significant tax breaks under ACES for exploration.

ConocoPhillips has been coining money in Alaska for decades under 3 different tax systems. And they've been spending a far smaller relative amount on capital investments and exploration under all 3 tax systems. Capital expenditures are actually UP under ACES, although clearly not enough.

Alaska has some built-in disadvantages to new exploration but also some existing infrastructure advantages. I'd like to get to the bottom of it, but the debate up there has turned poisonously political. Fat chance to get at the facts in that environment. And with all due respect, thackney, you're not helping with some of the sources you quote. The Big 3 has long since demonstrated that they have not earned the "trust me" seal of approval in Alaska.

27 posted on 04/13/2012 11:51:24 AM PDT by Al B. ("Evil is powerless if the good are unafraid." -- Ronald Reagan)
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To: thackney
You are also using the price of oil sold in the L48.

Nope, comes from page 155 of the SEC 10-K filing.

28 posted on 04/13/2012 11:54:08 AM PDT by Al B. ("Evil is powerless if the good are unafraid." -- Ronald Reagan)
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To: Al B.

I understand the ConocoPhillips use it in their filing for more information.

I disagree it is a fair comparison for dollars spent and received in Alaska to use the price in California and Washington.


29 posted on 04/13/2012 12:08:20 PM PDT by thackney (life is fragile, handle with prayer)
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To: Al B.
ConocoPhillips has been coining money in Alaska for decades under 3 different tax systems. And they've been spending a far smaller relative amount on capital investments and exploration under all 3 tax systems.

Cannot you not look at those two statements and see how they contradict each other. ConocoPhillips is in the business to make money. They are going to put their money where they get the best return.

I left Alaska to return to Texas after ACES was put into effect. The engineering group I was leading then dwindled down to 1/3 its size in a few years. I hired people who worked for me in Alaska back down in Texas. I know first hand of the projects that were shut down when this went into effect.

It is an insane squeezing of the golden goose. Alaska has as much fiscal stability as a low-end 3rd world country. And Palin wasn't alone in pushing that mess into place.

It is ridiculously convoluted oil tax system, and not just ACES. When I see the success of straight forward plans as executed in Texas and North Dakota, I can not help but wonder why Alaska doesn't get a clue. My original point on this thread, was of all the real accomplishments of Palin, I would not lead off with the two that have significant complaint and are in the process of being changed in current Alaskan actions.

30 posted on 04/13/2012 12:21:28 PM PDT by thackney (life is fragile, handle with prayer)
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To: haircutter
Such for assumptions, but I've long been married to a woman "with more smarts and knowledge than" me.

This was the time. Once again, past tense. There may my well be no other.

31 posted on 04/13/2012 12:30:04 PM PDT by onedoug
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To: thackney
I recall some posts from you not too long ago remarking about the ridiculously high prices being paid for ANS crude by West Coast refineries in 2011. At the time you were wondering whether the anomalous situation would hold. :)

At any rate, if you take CP's consolidated Alaska revenues for 2011 ($8,142K) and their taxes paid in Alaska ($2,721K), it's still only 33.4%.

32 posted on 04/13/2012 12:33:42 PM PDT by Al B. ("Evil is powerless if the good are unafraid." -- Ronald Reagan)
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To: Al B.

And you are still not counting the royalties. You also seem to imply that 33.4% state taxes is a good number. Do you know any other industry or any other state with such a high figure? How would your business do if you paid 33.4% to the state before you had to jump into federal taxes?


33 posted on 04/13/2012 12:37:58 PM PDT by thackney (life is fragile, handle with prayer)
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To: Al B.
I recall some posts from you not too long ago remarking about the ridiculously high prices being paid for ANS crude by West Coast refineries in 2011. At the time you were wondering whether the anomalous situation would hold.

It still is dang high. $121.39 is yesterday's cash price.

http://online.wsj.com/mdc/public/page/2_3023-cashprices.html?mod=topnav_2_3000

The differential to WTI is not going to hold. $20 differential for light sweet from Cushing, OK to Gulf Coast. We are going to see more than one additional pipeline headed towards the Gulf area refineries.

34 posted on 04/13/2012 12:42:57 PM PDT by thackney (life is fragile, handle with prayer)
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To: thackney
Cannot you not look at those two statements and see how they contradict each other.

No I don't, in light of the fact that you and others have been trying to pin all of Alaska's oil problems on Palin's ACES. That's what this and other discussions on this topic around here have always been about.

I fully recognize there are some systemic problems in Alaska which need to be understood which, at least for CP, seem to be independent of a particular tax system. To try and pin this on Palin's ACES is disingenuous to the max. When you stop doing that, I'll know we're making progress on understanding the problem, at least on FR.

35 posted on 04/13/2012 12:46:10 PM PDT by Al B. ("Evil is powerless if the good are unafraid." -- Ronald Reagan)
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To: Al B.
You can pretend all you want this isn't the problem. But it is the number one legislative issue in Alaska for a darn good reason.

Shops empty as oil production declines {Alaska}
http://freerepublic.com/focus/f-news/2863934/posts
Alaska Journal of Commerce - Mar 22, 2012

I was inspecting modules in this shop when ACES was announced. It was packed with building at that time. There is a significant lack of work in this industry in Alaska while most of the rest of North America is booming in oil production.

The welding shops are low on work, the haulers are low on work. I was in Kuparuk looking at some maintenance projects a couple months ago, I will be back up there next month. I'm not just some keyboard cowboy spouting an opinion. I am still working with equipment suppliers in Alaska and this has continued to drag them down.

36 posted on 04/13/2012 12:57:00 PM PDT by thackney (life is fragile, handle with prayer)
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To: thackney
When you look at the ND state and private landowner take in ND, it's about 33%. Amanda Coyne at the Alaska Dispatch made the case that ND's 33% compares to Alaska's 39%. She states that there is a discrepancy but it's not the wild-eyed 85% vs 11% that some of the Big 3's proponents make.

She also makes the case that Alaska's state take on oil compares very favorably to other places in the world, including TX and LA when you factor in the private landowner take.

Myth-busting claims in Alaska's oil tax debate: Part I

There's also a Part II lined in the above article.

I don't like taxes period, but there should be an agreement between rational people based on truth when it comes to sharing profits between resource owners and operators. I certainly agree that the marginal curve under ACES probably needs changing to further incentivize operators when prices are high, but nothing like the giveaway that the Big 3 are demanding in exchange for....nothing but words.

37 posted on 04/13/2012 1:05:28 PM PDT by Al B. ("Evil is powerless if the good are unafraid." -- Ronald Reagan)
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To: thackney

The article you link was written by a former paid BP lobbyist to the Alaska legislature. I’ll give it its due consideration.


38 posted on 04/13/2012 1:09:23 PM PDT by Al B. ("Evil is powerless if the good are unafraid." -- Ronald Reagan)
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To: Al B.
You can bash the source all you want. The shop is still empty along with ASRC’s. The workers have left and found other work.

If Alaska doesn't want to become competitive, their are plenty of production available in Alberta, ND, Texas and others.

I was always amazed up there by the attitude that there was not other place the companies can go.

39 posted on 04/13/2012 1:12:45 PM PDT by thackney (life is fragile, handle with prayer)
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To: Al B.

You quote the Dispatch and then complain about my sources???

http://www.bwenergylaw.com/News/documents/NorthDakotaStateLeasestoCarryaHigherRoyaltyRate.pdf

The state royalty rate is 1/6, they have considered raising to 3/16 or even 1/5. A high rate, but I don’t see anything approaching 33% with the tax added.

http://bismarcktribune.com/news/local/state-looking-to-get-more-money-for-oil-on-state/article_1ec89df6-4322-11e1-a71c-001871e3ce6c.html


40 posted on 04/13/2012 1:23:39 PM PDT by thackney (life is fragile, handle with prayer)
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