Isn’t it odd that an 800-mile pipeline that runs across environmentally sensitive land has been permitted without any mention in the media? Not a word about it from President Obama either.
Obama’s Secret Pipeline will be built over land that’s much more sensitive than that of the Keystone XL pipeline, which gets nothing but front-page coverage. It will actually be 17% (six inches) larger in diameter than Keystone XL (36 inches) and it will transport natural gas, not oil.
Bill 138
The Senate of Alaska, the state in which the pipeline will be built, has just passed Bill 138, which makes the state a partner of three of the world’s largest oil companies, including one that has a horrible environmental track record on US soil. In a nutshell, Alaska’s government is now partners with BP, ExxonMobil, and ConocoPhillips.
Only one more signature is required—Governor Sean Parnell’s—and it’s expected that he will sign the deal.
Not Even the US Government Wants US Dollars
For more than 100 years, the US government has been receiving a royalty and tax revenue paid on the amount of oil or natural gas produced on American soil—a fee that is paid in US dollars. Bill 138 has changed this forever.
Instead of Alaska receiving its dues in US dollars, the state legislature has decreed through Bill 138 that the state will be paid “in kind.†In other words, the state will be getting its share of royalty and tax revenue in natural gas instead of US dollars.
For the record, this is the first time ever that a US state has entered into a partnership like this. Essentially, Alaska is now a 25% equity partner with BP, ExxonMobil, and ConocoPhillips—which also requires the state to cough up cold, hard cash to build the entire project, including the 800-mile-long, 42-inch-wide pipeline.
Overall, the project is currently estimated to cost north of US$50 billion, and we expect that when all the capital expense overruns and government inefficiencies are accounted for, the whole project will come in at more than US$75 billion, using the total costs of similar projects for comparison.
