Legislature(2025 - 2026)SENATE FINANCE 532
05/06/2025 09:00 AM Senate FINANCE
Note: the audio ![]()
and video ![]()
recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.
| Audio | Topic |
|---|---|
| Start | |
| SB184 | |
| SB92 | |
| SB156 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 184 | TELECONFERENCED | |
| += | SB 92 | TELECONFERENCED | |
| + | SB 156 | TELECONFERENCED | |
SENATE FINANCE COMMITTEE
May 6, 2025
9:02 a.m.
9:02:45 AM
CALL TO ORDER
Co-Chair Hoffman called the Senate Finance Committee
meeting to order at 9:02 a.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Donny Olson, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Mike Cronk
Senator James Kaufman
Senator Jesse Kiehl
Senator Kelly Merrick
MEMBERS ABSENT
None
ALSO PRESENT
Liz Harpold, Staff, Senator Donny Olson; Senator Giessel,
Sponsor; Luke Saugier, Hilcorp Alaska, Alaska Senior Vice
President; Sharon Lechner, Chief Executive Officer,
Commercial Fishing and Agriculture Bank.
PRESENT VIA TELECONFERENCE
Todd MacManus, Alaska Bankers Association, Ketchikan.
SUMMARY
SB 92 CORP. INCOME TAX; OIL and GAS ENTITIES
SB 92 was HEARD and HELD in committee for further
consideration.
SB 156 AK COMMERCIAL FISHING and AG BANK; LOANS
SB 156 was HEARD and HELD in committee for
further consideration.
SB 184 SCHOOL BOND DEBT REIMBURSEMENT
SB 184 was HEARD and HELD in committee for
further consideration.
SENATE BILL NO. 184
"An Act relating to school bond debt reimbursement;
and providing for an effective date."
9:02:45 AM
LIZ HARPOLD, STAFF, SENATOR DONNY OLSON, introduced the
legislation. She provided history on the moratorium.
9:05:35 AM
Co-Chair Hoffman OPENED public testimony.
Co-Chair Hoffman CLOSED public testimony.
Senator Kiehl discussed the fiscal note.
SB 184 was HEARD and HELD in committee for further
consideration.
SENATE BILL NO. 92
"An Act establishing an income tax on certain entities
producing or transporting oil or gas in the state; and
providing for an effective date."
9:11:30 AM
SENATOR GIESSEL, SPONSOR, reintroduced the bill.
9:15:33 AM
LUKE SAUGIER, HILCORP ALASKA, ALASKA SENIOR VICE PRESIDENT,
discussed the presentation, "Senate Finance Committee: SB
92" (copy on file). He began with slide 2, "Hilcorp Alaska
Overview
? Overview:
- Employee Count: 1,700
- Contractor Count: 2,500
- Gross Oil Production: 350 kboe/d
- Net Oil Production: 159 kboe/d
- More than 700 partnerships with local business,
generating over $750 million in annual spend with
Alaska vendors
? Hilcorp Alaska Key Events:
2012 - Hilcorp enters Alaska with the purchase of
Chevron's Cook Inlet assets
2014 - An acquisition from BP expands our
operations to include the North Slope
2020 - Hilcorp buys BP's remaining assets in the
state, becoming Alaska's largest operator
2024 - Hilcorp's footprint on the Slope expands
as Eni and Chevron exit the state
- Hilcorp purchases the Spartan 151 jack-up rig
to prevent it from leaving Alaska
9:19:14 AM
Mr. Saugier pointed to slide 3, "Setting Records at Milne
He addressed slide 4, "Milne Point Case Study, Finding New
Opportunities and Growing Production":
Development Highlights:
? Grew production by 250 percent since
acquisition in 2014
- 127 wells drilled (14 with coiled tubing)
- 58,000 bbls of polymer solution injected
daily
- 60 percent more produced fluid processed
daily vs pre-acquisition
- 21 ESP to jet pump conversions
- Two new pads constructed
- Increased field production by more than
30,000 BOPD since acquisition, more than
doubling production
- Tripled proved reserves since acquisition
while replacing runoff
- Invested $1.5 billion in development
capital
9:23:00 AM
Mr. Saugier looked at slide 5, "Operating Efficiency":
Ownership and Alignment
• Investing in equipment upgrades
• Empowering employees to make decisions
Urgency
• Field and office alignment results in innovative
wins
• Improving operating efficiency requires hundreds of
small wins
Integrity and Innovation
• Investing in new wells
• Reduce emissions
• Operate safely and responsibly
Senator Merrick recalled Mr. Saugier stating that it cost
almost ten times more to do business in Alaska than it does
in Texas. She wondered why there was continued investment
in Alaska.
9:27:12 AM
Mr. Saugier replied Alaska had been beneficial to his
company.
Co-Chair Stedman asked about the participation of credit
for the project.
Mr. Saugier replied that there had been a slow movement
toward providing capital for the project.
9:29:47 AM
Senator Kiehl queried whether the share of cost was the
same as the share to the state.
Mr. Saugier replied in the affirmative.
Mr. Saugier discussed slide 6, "The Hilcorp 'Wedge.'" He
looked at slide 7, "The Hilcorp 'Wedge.'"
9:44:10 AM
Co-Chair Stedman looked at slide 7, and asked for an
explanation of the production tax.
9:45:56 AM
Senator Kiehl wondered whether Hilcorp's entrance "tilted
the playing field" against the other two owners.
Mr. Saugier replied that major international c-corporations
were different than independent oil producers.
Senator Kiehl felt that the different company structure
showed a higher profit.
Mr. Saugier felt that was a misconception.
Senator Kiehl wondered whether the bill would not let
Hilcorp make deductions outside of Alaska.
Mr. Saugier did not know.
9:49:55 AM
Senator Cronk queried the total number of barrels of oil
per day produced by Hilcorp in Alaska.
Mr. Saugier replied that Hilcorp kept approximately 135,000
barrels of oil per day, and operated significantly more of
that.
Senator Kaufman that there was a disincentive caused by
even a "hint" of impending change. He wondered about the
net value argument, and asked for clarification about the
net dollars.
Mr. Saugier replied that the current slide showed a value
increase from 2019 to present day.
9:53:49 AM
Senator Kiehl asked about a perspective of the entire North
Slope. He remarked on the major fields that were yet to be
explored, and one that had production. He wanted to
understand that difference and the role of the tax in
question.
Mr. Saugier replied that Hilcorp brought a new 80,000
barrels per day, but he could not speak to the other
investments.
10:00:30 AM
Senator Cathy Giessel reintroduced a statement made on
February 6, 2020.
SB 92 was HEARD and HELD in committee for further
consideration.
SENATE BILL NO. 156
"An Act relating to the Department of Commerce,
Community, and Economic Development; relating to the
Alaska Commercial Fishing and Agriculture Bank;
relating to certain loans made by the Alaska
Commercial Fishing and Agriculture Bank; and providing
for an effective date."
10:05:22 AM
SENATOR JESSE KIEHL, SPONSOR, introduced the legislation.
10:10:40 AM
Co-Chair Stedman wondered why there was not a repeal to the
previous legislation.
Senator Kiehl stated that there was headwind against the
commercial fishing industry, so there was interest in
refinancing existing loans.
Co-Chair Stedman queried the commercial banking industry.
Senator Kiehl replied that there was a letter from the
bankers, who were consistent in their philosophy on the
state's participation of lending.
10:13:31 AM
Co-Chair Stedman felt that the state should consider
alternative options to maintain partnerships with the
banking industry.
Senator Kaufman asked about Alaska Industrial Development
and Export Authority (AIDEA), and whether they would not
engage in the lending.
Senator Kiehl replied that the difference was the direct
connection to the Alaska businesses in the commercial
fishing industry by using a limited entry permit as
collateral.
10:18:58 AM
SHARON LECHNER, CHIEF EXECUTIVE OFFICER, COMMERCIAL FISHING
AND AGRICULTURE BANK, spoke to the importance of the
interest rate to the industry and local communities.
Co-Chair Stedman asked whether there was a two-year window.
Ms. Lechner replied that there was not an expectation to go
broke, because there was significant equity.
10:24:29 AM
Co-Chair Hoffman OPENED public testimony.
10:24:48 AM
TODD MACMANUS, ALASKA BANKERS ASSOCIATION, KETCHIKAN (via
teleconference), opposed the bill.
Co-Chair Hoffman CLOSED public testimony.
Co-Chair Stedman reviewed the fiscal notes.
Senator Kiehl thanked the committee.
SB 156 was HEARD and HELD in committee for further
consideration.
ADJOURNMENT
10:32:33 AM
The meeting was adjourned at 10:32 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 156 Public Testimony-Email-Harry Moore 04.14.25.pdf |
SFIN 5/6/2025 9:00:00 AM |
SB 156 |
| SB 156 Sponsor Statement version N 4.28.25.pdf |
SFIN 5/6/2025 9:00:00 AM |
SB 156 |
| SB 156 Supporting Documents-Seafood Taskforce CFAB Recommendation 4.28.25.pdf |
SFIN 5/6/2025 9:00:00 AM |
SB 156 |
| SB 156 Supporting Documents-Southwest Alaska Municipal Conference Resolution 4.28.25.pdf |
SFIN 5/6/2025 9:00:00 AM |
SB 156 |
| SB 156 Sectional Analysis version N 4.28.25.pdf |
SFIN 5/6/2025 9:00:00 AM |
SB 156 |
| SB 156 L&C DCCED CRA 042925.pdf |
SFIN 5/6/2025 9:00:00 AM |
SB 156 |
| SB 92 Testimony 050525.pdf |
SFIN 5/6/2025 9:00:00 AM |
SB 92 |
| SB 156 Opposition Alaska Bankers Association.pdf |
SFIN 5/6/2025 9:00:00 AM |
SB 156 |
| SB 92 5.6.25 Hilcorp Senate Finance Committee Presentation SB92.pdf |
SFIN 5/6/2025 9:00:00 AM |
SB 92 |
| SB 184 Sectional Analysis Version N 05.06.25.pdf |
SFIN 5/6/2025 9:00:00 AM |
SB 184 |
| SB 184 Sponsor Statement Version N 05.06.2025.pdf |
SFIN 5/6/2025 9:00:00 AM |
SB 184 |