ANCHORAGE, Alaska, Dec 10 - A year after oil markets soared to record highs and then crashed, prices have stabilized well off their 2008 highs but more than double their lows, and markets are expected to be calmer for the foreseeable future, Alaska's top revenue official said on Thursday.
"What a difference a year makes," Pat Galvin, commissioner of the state Department of Revenue, said at a news conference in which he issued the state's semi-annual revenue forecast.
In all, Alaska expects to reap unrestricted revenues of $4.8 billion in the current fiscal year and $5.2 billion in fiscal 2011, a brighter picture for the state treasury than what appeared to be the case last spring, when the department issued its last official forecast, Galvin said.
A proposed fiscal 2011 budget from Gov. Sean Parnell is due next Tuesday.
Oil taxes, royalties and fees will make up over 87 percent of the state's general revenues through fiscal 2019, the department's forecast said. Alaska has no personal income tax and no statewide sales tax.
The department forecasts that West Coast prices for Alaska North Slope crude will average $66.93 a barrel in the current fiscal year, which ends on June 30, rising to $76.35 a barrel in fiscal 2011. After that, the department projects that prices will continue to rise, to $101.49 a barrel by fiscal 2019.
Production, however, will continue the long-term slide that started after peak North Slope output of over 2 million barrels per day was reached in 1988.
Production for the current fiscal year is expected to average 659,000 barrels per day, a 4.8 percent decline from the average posted in fiscal 2009, Galvin said.
In fiscal 2011, which starts July 1, the department is expecting average daily production to be 623,000 barrels, he said.
The department expects North Slope output to rise in fiscal 2013 and 2014, thanks to new production from fields that are being developed or expanding, Galvin said. He listed Pioneer Natural Resource's (PXD.N) Oooguruk field, Eni's (ENI.N) Nikaaitchug field and the Exxon Mobil's (XOM.N) Point Thomson field and some satellites to ConocoPhillips' (COP.N) Alpine field, as projects that would temporarily boost output.
After that, production will drop, ultimately to an expected 524,000 barrels a day in fiscal 2019, according to the forecast.
State oil revenues have risen sharply under the current tax system, a levy on net-profits that was passed by the legislature in 2007 and supported by then-Gov. Sarah Palin.
Oil companies have complained that Alaska's new tax system is especially burdensome and eliminates economic rewards when prices are high, thereby making Alaska investments less attractive.
Galvin said the state is reviewing its tax system to see whether it is discouraging investment. But so far, he said, the department is not seeing any such discouragement.
The department forecasts investments by oil and gas leaseholders to total $4.5 billion in this fiscal year and $5 billion in fiscal 2010. Those projections are based on individual companies' reports to the department, Galvin said, and include both capital and direct operating investments.
The governor has ordered a formal review of state oil taxes and their effects.
"What a difference a year makes," Pat Galvin, commissioner of the state Department of Revenue, said at a news conference in which he issued the state's semi-annual revenue forecast.
In all, Alaska expects to reap unrestricted revenues of $4.8 billion in the current fiscal year and $5.2 billion in fiscal 2011, a brighter picture for the state treasury than what appeared to be the case last spring, when the department issued its last official forecast, Galvin said.
A proposed fiscal 2011 budget from Gov. Sean Parnell is due next Tuesday.
Oil taxes, royalties and fees will make up over 87 percent of the state's general revenues through fiscal 2019, the department's forecast said. Alaska has no personal income tax and no statewide sales tax.
The department forecasts that West Coast prices for Alaska North Slope crude will average $66.93 a barrel in the current fiscal year, which ends on June 30, rising to $76.35 a barrel in fiscal 2011. After that, the department projects that prices will continue to rise, to $101.49 a barrel by fiscal 2019.
Production, however, will continue the long-term slide that started after peak North Slope output of over 2 million barrels per day was reached in 1988.
Production for the current fiscal year is expected to average 659,000 barrels per day, a 4.8 percent decline from the average posted in fiscal 2009, Galvin said.
In fiscal 2011, which starts July 1, the department is expecting average daily production to be 623,000 barrels, he said.
The department expects North Slope output to rise in fiscal 2013 and 2014, thanks to new production from fields that are being developed or expanding, Galvin said. He listed Pioneer Natural Resource's (PXD.N) Oooguruk field, Eni's (ENI.N) Nikaaitchug field and the Exxon Mobil's (XOM.N) Point Thomson field and some satellites to ConocoPhillips' (COP.N) Alpine field, as projects that would temporarily boost output.
After that, production will drop, ultimately to an expected 524,000 barrels a day in fiscal 2019, according to the forecast.
State oil revenues have risen sharply under the current tax system, a levy on net-profits that was passed by the legislature in 2007 and supported by then-Gov. Sarah Palin.
Oil companies have complained that Alaska's new tax system is especially burdensome and eliminates economic rewards when prices are high, thereby making Alaska investments less attractive.
Galvin said the state is reviewing its tax system to see whether it is discouraging investment. But so far, he said, the department is not seeing any such discouragement.
The department forecasts investments by oil and gas leaseholders to total $4.5 billion in this fiscal year and $5 billion in fiscal 2010. Those projections are based on individual companies' reports to the department, Galvin said, and include both capital and direct operating investments.
The governor has ordered a formal review of state oil taxes and their effects.
