Despite longstanding economic ties, there is a growing disconnect between Alaska and Washington over oil development. Gov. Jay Inslee and other Washington politicians are critics of plans for drilling in Arctic waters off Alaska.
A month ago, the Alaska House of Representatives took time out from struggling to forge a state budget in the face of plummeting oil prices to talk about Washington state.
For nearly an hour, they debated the wording of a five-page resolution that blasted Evergreen State politicians for their opposition to Shell’s offshore oil exploration in the Arctic and mockingly called for a different tack on combating climate change.
Rather than try to block offshore oil development in the Arctic, the resolution suggested Washington ought to “ … look first at closing the Boeing production facilities to reduce emissions of carbon dioxide from commercial activity.”
“It must be nice to eat cheese and sip wine in Olympia while they talk about the Arctic,” said Alaska state Rep. Bob Herron, a Democrat from Bethel, during the floor debate. “But it does remind us of the paternalistic past when the state of Alaska was plundered by people from Washington and other areas … who covet our resources.”
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The measureoverwhelmingly passed both Alaska’s House and Senate, a reflection of the growing disconnect over fossil-fuel development between two states with deep and, at times, turbulent ties.
Several top Washington politicians, including Gov. Jay Inslee and Seattle Mayor Ed Murray, have been vocal critics of the offshore oil-development plans. Both Washington senators, Maria Cantwell and Patty Murray, have long opposed opening up the Arctic National Wildlife Refuge (ANWR), on Alaska’s northern coastal plain, to drilling.
The widening gap between the two states was highlighted recently when Mayor Murray tried to block Shell Oil from basing its fleet at the Port of Seattle by announcing that it would violate a city permit.
“It’s time to turn the page,” he said. “If it was up to me, there would be no place for offshore oil-drilling equipment in Seattle.”
In Alaska, there is scant talk of a transition to a post-petroleum future.
The oil boom that began in the 1970s with the development of the Prudhoe Bay field has generated wealth that funds up to 90 percent of the state’s operating budget. Alaska residents do not pay any state income or sales taxes, but instead collect annual dividend checks spun off by the state’s oil-wealth savings account, valued at more than $50 billion.
This oil money also courses through Washington’s economy.
Puget Sound has been a staging ground for the oil industry’s massive efforts to develop North Slope fields and build the trans-Alaska pipeline. Washington’s refineries process Alaska oil.
The oil trade is part of a much larger swath of Alaska commerce connected to Washington. A business-funded “Ties that Bind” study released earlier this year by the Juneau-based McDowell Group found that Alaska businesses of all kinds generated 113,000 jobs and $6.2 billion in wages in the Puget Sound region.
That’s a sizable footprint even as Seattle is riding high on the tech boom.
The riches Washington reaps from up north have long been a sensitive topic in Alaska, where the drive to statehood was propelled by a backlash against domination of the state’s fishing industry by Puget Sound companies.
Still, Alaskans who traveled to Seattle for a Port of Seattle meeting this week, to speak in support of Shell’s drilling plan, were eager to highlight those economic ties.
John Hopson Jr., the mayor of Wainwright on the North Slope, said all the village’s merchandise and fuel comes from Washington.
The village has benefited from development of Prudhoe Bay fields.
Hopson’s community is along the shores of the Chukchi Sea, where Shell holds offshore leases. And he appeared eager for an offshore oil boom.
“Seattle has had over 100 years to develop, but our communities are young and our region hasn’t had the time to develop the luxuries that you have here,” Hopson said as he urged the Port to support Shell. “We need our chance, too.”
Waning oil revenue
Alaska’s narrow dependence on oil revenues blew huge holes in the state budget as crude prices plummeted over the past year.
It also poses long-term problems. Oil production has been on a slow decline, with the volumes running through the trans-Alaska pipeline down by 75 percent from peak flows.
“After three and a half decades when oil drove along the economy and paid for government, people are wavering between concern and panic about what might lie ahead,” said Gunnar Knapp, director of the University of Alaska’s Institute of Social and Economic Research.
To keep the oil flowing, Alaskans have first looked to more onshore development.
The best hope for a huge new strike on land — the coastal plain of the Arctic National Wildlife Refuge — has been kept off-limits in an ongoing congressional battle over one of the most ecologically diverse areas of the Arctic. Cantwell has helped lead the opposition to drilling there.
“There were test wells drilled in the 1980s. But we know the history. It became the poster child for the environmental movement,” said Robert Dillon, a spokesman for the Republican majority of the Senate Energy Committee, which is now chaired by Alaska’s Lisa Murkowski.
For Alaska politicians, the failure to open the refuge has elevated the importance of drilling in federal waters off Alaska.
The Chukchi Sea area where Shell will be drilling is considered by the company to be one of the world’s top prospects for a major new oil find. Unless current federal law is amended, offshore development would offer the state no new royalty revenue but could provide jobs and oil for the trans-Alaska pipeline.
But Murkowski, a Republican, hopes that law can be amended so that Alaska can receive part of the federal revenues, an arrangement already in place with states like Louisiana for federal offshore leases in the Gulf of Mexico.
Opponents of offshore development stress the risk of oil spills, particularly if commercial production would unfold during the extreme cold, ice and darkness of an Arctic winter.
But the sharpest separation between Washington’s top politicians, nearly all Democrats, and their peers in strongly Republican Alaska, is whether offshore exploration should be pursued as scientists warn of escalating climate-change risks generated by fossil-fuel use.
“To a large extent, these are not local or regional differences, but national divisions between the two parties,” said former Washington Sen. Slade Gorton, a Republican.
Many of Alaska’s political leaders question how much humans contribute to climate change.
Earlier this year Murkowski voted yes on a Senate resolution that stated that human activity contributes to climate change. But she voted no on an amendment that would have added the word “significantly.”
State Sen. Cathy Giessel, who sponsored the Alaska Legislature’s Washington resolution, said, “I don’t believe you can make a definitive statement either way” about the human role in changing the environment.
The domination of Alaska’s politics by pro-oil forces frustrates Alaska climate-change activists. They include Faith Gemmill, a Gwich’in Indian from an Arctic village who is executive director of a Native environmental group.
“Alaska is on the front lines of climate change. There are communities literally crumbling off into the ocean. This is a time to oppose more dirty fuels,” said Gemmill, who will be in Seattle on Saturday for anti-Shell protests (opponents plan a “flotilla rally” of kayaks) and then head to the Netherlands to attend a Shell shareholder meeting.
In the Pacific Northwest, environmentalists have helped turn the region into a hub of opposition to oil trains, oil rigs and coal ports.
Reducing carbon emissions is a top priority of Gov. Jay Inslee and many of his Democratic colleagues.
Inslee has been promoting alternative-energy development and pushing legislation that would cap carbon emissions in the state. He also wrote a letter to Interior Secretary Sally Jewell opposing further offshore Arctic oil and gas leases.
“Some in Alaska have said we are hypocritical to oppose additional approvals for Arctic drilling while we support Washington companies that contribute to carbon pollution,” said David Postman, a spokesman for Inslee.
“But that’s a false narrative. The governor is pushing stringent carbon limits on all Washington businesses and any entity that emits major carbon pollution.”
Meanwhile, Alaska politicians are eager to try to find a home for the fleet in their state. One option is Seward, where an industrial shipyard is under development.
“It’s not ready yet. But we would be happy to get to work and make sure the infrastructure is here,” said Giessel, the Alaska state senator.