October 30, 2020
Friday AM

As of October 26th, West Texas Crude is selling for $38.45. That means they are losing between $7.55 and $13.55 on every barrel. It also explains why 16 Texas producers have declared bankruptcy since January. See oil patch bankruptcy monitor.

Calculations from ConocoPhillips show the combine production and delivery costs for Prudhoe, Kuparuk and Alpine oil fields to range between $22 and $25. As of October 26th, North Slope crude is selling on the West Coast for $41.64, which means every barrel of Alaskan's legacy field's Crude produces a net profit of between $16.64 and $19.56.

Take the lower profit number and times it by 500,000 barrels per day, and times that number by 365 days, and you get a net profit of over $3 billion; more than $4,000 per man woman and child in Alaska. Any other oil producing country would be keeping between 70 and 90% of that $3 billion. But you and I won't get any of it. In 2014, your bought and paid for legislators voted to give Alaska's fair share of North Slope profits to BP, Exxon, and ConocoPhillips.

The lower 48 has thousands of wells that produce a small amounts of oil and run dry in about three years. Alaska has a comparatively small number of wells that produce large amounts of oil and last for decades. As you can see from factual publications, contrary to what the oil companies want you to believe, it costs far less to produce the North Slopes highly efficient giant oil fields; In fact, North Slope oil production is the lowest cost most profitable production in the Northern Hemisphere.

The dividends you were getting since the passage 2014 of Senate Bill 21 were made possible by the savings saved up under oil tax laws repealed by Senate Bill 21. Those savings are now gone and Alaska is teetering on bankruptcy. Proposition 1 will only get back about half of what is still being given away by Senate Bill 21, but it is a step in the right direction.

Ray Metcalfe
Anchorage, Alaska

About:

Ray Metcalfe was the legislator who co-authored the statute setting out the original investment strategy for the Permanent Fund, and was the whistle-blower who went to the FBI and exposed Veco owner Bill Allen for bribing those legislators then known as the "Corrupt Bastards Club" who were jailed for taking Bill Allen's bribes in exchange for their votes against higher taxes on North Slope oil.

Editor's Note:

The text of this letter was NOT edited by the SitNews Editor.

Received October 29, 2020 - Published October 30, 2020

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