Homer Alaska - Business

Story last updated at 4:54 PM on Wednesday, February 1, 2012

Kenai lawmaker backs legislation for industry



By Molly Dischner
Morris News Service - Alaska

Sen. Tom Wagoner, R-Kenai, is working on several pieces of legislation to support industry activity around the state.

At the recent Kenai Peninsula Economic Development District's Industry Outlook Forum, Wagoner said he has legislation in the works that could benefit oil and gas exploration and development, gravel mining and more.

A gravel bill would exempt some sand and gravel extraction from the state's mining tax law. That would make it more practical for small-scale operations to continue their work, Wagoner said. Currently, some operations pay more to calculate their tax than they actually pay in taxes. Wagoner said that effort is supported by area builders, who think the change could benefit those looking to buy sand and gravel for construction projects.

Wagoner also is working to revise the credits for jack-up rigs. As the incentives currently stand, the tax credit applies to the first rig, and the first three unaffiliated companies that use that rig.

But that doesn't help if there's a second rig enroute to the Inlet, and the second rig offers different drilling options than the first, which Wagoner said is important for continued Cook Inlet development.

Wagoner said he's hoping to adjust the rules so that the second and third credits could be used by unaffiliated users of a different rig, not just the first rig.

He's also trying to provide legislation that gives the state's Department of Natural Resources and the Alaska Oil and Gas Conservation Commission more control in checking that the rigs meet best industry practices.

Another of Wagoner's efforts would offer incentives for natural gas exploration in other parts of the state.

"One is a bill very similar to our Cook Inlet stampede, but it's going to be an incentive to drill for gas in the Nenana basin," Wagoner said.

That bill could become a Christmas tree, with all sorts of resource development incentives added, but Wagoner said such additions help provide a wider base of support for the bill. And he doesn't think companies will use the incentives unless it pencils out to do the exploration.

"The problem is getting a company to take a drill rig out there to do the exploratory drilling," Wagoner said.

Wagoner said he's also working with other legislators on oil tax reform. Right now, he's hoping that the Senate will be able to pass a bill and hand it over to the House with four weeks left in the session, he said.

Aside from industry-boosting efforts, Wagoner said another project would benefit the daily lives of Kenai Peninsula residents. That's an effort to help reduce the duration of a highway closure after an accident. Those closures can be expensive and frustrating for area residents, he said.

"It's possible to cut those down by 50 percent," he said.

Right now, he's researching the cost of providing Alaska State Troopers with equipment that would allow them to take care of their on-scene investigation more quickly. The equipment already exists, it's just a matter of purchasing it for Troopers to use, he said.

Molly Dischner is a reporter for the Peninsula Clarion.

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