Governor Signs Legislation Providing Incentives for In-State Refineries

Governor Parnell signing House Bill 287, legislation providing incentives to the state's refineries. Image-Office of the Governor
Governor Parnell signing House Bill 287, legislation providing incentives to the state’s refineries. Image-Office of the Governor

Alaska Governor Sean Parnell on Tuesday signed House Bill 287, legislation giving incentives to Laska refineries.. The legislation allows an in-state refinery tax credit against state corporate income tax liability for infrastucture expenditures.

HB 287, legislation that Parnell himself sponsored, also allows lessees who sell oil to in-state refineries to use its contract price to determine the royalty owed to the state.

In addition, the legislation extends the state’s contract with Tesoro on the Kenai peninsula,  for the sale of royalty oil.

“We support Alaska’s oil being refined for Alaskans’ use and the jobs that come with it,” Governor Parnell said. “By providing a more favorable tax climate for in-state refining, we can have a more secure future in refining. A healthy refining industry will continue to provide jobs for Alaskans, heat our homes, and power our military.”

Speaker of the House Mike Chenault, Representative for the central Kenai Peninsula, the area that includes the city of Nikiski, the location of the Tesoro refinery, heralded the bill’s passage and thanked the governor and legislature for passing the bill. and says, 

“This contract ensures Tesoro has the certainty it needs to keep production running for the near term. The refinery is a boon to the local economy and provides family-sustaining jobs to residents on the Upper Kenai Peninsula, not to mention the tax base for the Borough. Tesoro has been a fine partner for the Kenai for many years, and I am glad we as a legislature were able to work together, with the governor, to ensure they can remain.”

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Chenault continued, saying, “Thanks to the governor for proposing this bill. The refinery is vital to my district, and to the state.”

Alaska’s refineries produce gasoline, diesel fuel, commercial and military jet fuel, heating oil and kerosene and employ hundreds of Alaskans.