What if production hadn’t declined?

It is true that Alaska would have made less under SB 21 than it did under ACES from 2008-2013. However, what if production had not declined at an average rate of six percent during that period of high oil prices?

Under a more favorable tax structure, investments in producing-enhancing projects on the North Slope would likely have increased and the production decline would likely have been much less. The state would have been able to tax tens of millions of additional barrels of oil.

As Andrew Jensen of the Alaska Journal of Commerce pointed out in a recent editorial, “Not only would that considerably change the calculus in comparing SB 21 and ACES, the state would be on a much firmer financial footing looking forward with greater production than it is now after enacting a growth-stunting tax formula that left Alaska behind while the rest of North America boomed.”

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