Alaska governor wants oil tax decreased

North slope drilling

The Alaska Legislature is once again reconsidering a change to the state's oil and gas production tax, as Governor Sean Parnell believes it is too high and discouraging developers from drilling in the North Slope oil fields.

The Alaska Journal of Commerce reported annual oil production in Alaska is declining by six percent every year. In 2012, lawmakers failed to create new legislation to lower the tax because some did not believe it would spur development. However, Parnell is expected to introduce a new bill in mid January.

The U.S. Department of Interior recently announced that 33 oil and gas onshore lease sales would be held in 2013, including Alaska. Tentatively, the sale is scheduled for November of 2013, but an exact data has not been decided on, the Cordova Times reported.

In 2013, the state will also have a natural gas pipeline constructed. Homer News reported that pipeline, which would carry gas from Fairbanks to south-central Alaska, will not carry natural gas liquids as originally planned. Because the "world is awash in natural gas liquids," pipeline engineering manager for the Alaska Gasline Development Group said the pipeline proposal was amended to have it transport only natural gas.

Alaska oil and gas production is explored at PennEnergy's research area.

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